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March 19, 2010

Judge Dissolves "United Youth Careers"

United Youth Careers, which had youths sell candy door-to-door in Des Moines and the surrounding area, has been dissolved by the Secretary of State and is prohibited from making any solicitations.

Des Moines. Polk County District Court Judge Don Nickerson has dissolved United Youth Careers, Inc., and ordered the organization to cease any door-to-door solicitations.

“This order shuts down United Youth Careers,” said Attorney General Tom Miller. “It should put an end to a questionable, long-running operation that used children to manipulate and deceive the public.”

Door-to-door solicitors for United Youth Careers have canvassed in Des Moines and Central Iowa for many years selling candy -- and telling potential contributors that proceeds are applied toward counseling services, job training, scholarships, and other youth education programs.

Miller’s office filed a lawsuit in 2008 alleging the directors of United Youth Careers, Inc., “engaged in a pattern of behavior establishing that the true purpose of United Youth is not public benefit but rather self-enrichment.” The suit alleged the group had “abandoned its charitable purpose” and asked the Court to dissolve the organization. [Go to information about and link to lawsuit filed 7-1-08.]

Judge Nickerson’s order prohibits United Youth Careers, including its directors, employees, volunteers, and other associates, from engaging in door-to-door solicitation of any kind. The order also dissolves the corporate entity United Youth Careers, and prevents the directors from serving on any other non-profit boards. Any violation of the order will be punishable by contempt of court, which could include jail time.

Attorney General Miller asked for the public’s help in enforcing the new order. “If you see anyone selling candy or soliciting on behalf United Youth Careers in your neighborhood, please contact the AG’s Office at 515-281-5926, or call the police.”

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More on the Attorney General’s lawsuit vs. United Youth Careers

“Our suit alleged that officers and directors of the corporation have exploited this non-profit corporation for their own private monetary gain,” Miller said. The suit was filed in July 2008.

Door-to-door solicitors for United Youth Careers told potential contributors that donations are applied toward counseling services, job training, scholarships, and other youth education programs, and also that donations are tax-deductible. United Youth Careers has not obtained IRS status to make donations tax-deductible, the suit alleged.

The defendants “have defrauded hundreds of Iowans,” the suit said. The suit asked the Court to dissolve United Youth Careers, prohibit further violations, order civil penalties, and order distribution of any assets to legitimate charitable purposes.

Background on timing and procedural steps in the litigation:

On March 18, 2010, the defendants ended their efforts to set aside the Court’s order, which was entered on Dec. 17, 2009. Details of the litigation:

The lawsuit was filed July 1, 2008. In Spring 2009, Judge Nickerson entered an injunction in the case that prohibited United Youth Careers from using minors to make solicitations; however, the group continued to go door-to-door using adult canvassers. On December 17, 2009, Judge Nickerson entered an expanded default judgment -- including the injunction dissolving the corporation completely and prohibiting any further solicitations by persons of any age.

The ruling came about as a result of United Youth Careers failure to obey a court order requiring the organization to provide the Attorney General with information about the organization’s financial dealings. Iowa Court rules allow a judge to impose sanctions against a party failing to obey such an order, including entering a default judgment. The court entered a default judgment in response to a motion from the Attorney General’s Office.

On January 12, 2010, United Youth Careers filed a motion to set aside the default judgment, and on January 18 the State filed a resistance to the motion. The motion to set aside does not affect the finality of Judge Nickerson’s default judgment. On February 18, the Secretary of State notified the Court that United Youth Careers has been dissolved.

On March 18, the Defendants ended an effort to set aside the Court’s order.

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