New York City St. Patrick’s Day Parade is on the offensive, filing a new claim against the former chair seeking to recoup the thousands of dollars Dunleavy racked up in expenses over the years and legal costs.

The New York City St. Patrick’s Day parade is going on offense with the filing of a new claim against former parade leader John Dunleavy that seeks to recoup thousands of dollars in unauthorized expenses Dunleavy allegedly racked up during his time in charge of the march, and the costs the parade has incurred defending against Dunleavy’s repeated legal actions.

The parade’s counterclaim for breach of fiduciary duty was filed in Bronx Supreme Court last Friday as part of the board’s answer to Dunleavy’s ongoing lawsuit which alleges he was illegally removed from his position of power after a board meeting in June of 2015.  At that meeting, Dr. John Lahey was named chairman of the parade’s board of directors, and he announced that the parade would make room for an Irish LGBT group in the 2016 march, a move Dunleavy was strenuously opposed to.

Former Chair of the NYC St. Patrick's Day parade John Lahey.

Former Chair of the NYC St. Patrick's Day parade John Lahey.

In the weeks after the June meeting, it came to light that a forensic audit of the parade’s finances showed multiple expenditures by Dunleavy on the parade’s credit card for at least $26,000 – charges that the parade board says were unauthorized and clearly unrelated to parade business.

The expenses during the years 2013, 2014 and 2015 included out of town trips by Dunleavy, meals, clothing and other personal items, the most glaring of which was the male enhancement drug Triverex, for which multiple charges of $42.94 appeared on the parade’s American Express card.

John Dunleavy

John Dunleavy

“The parade has never received an explanation as to why a charge for Triverex appeared on the credit card. How can that be related to the parade’s business?” a source closely connected to the parade told the Irish Voice.

“As a director and officer, Dunleavy owed a fiduciary duty to the Parade Corporation, which duty included, inter alia, a duty to put the interests of the Corporation above his own person interests,” the parade counterclaim says.

“Dunleavy was issued a corporate credit card by the Parade Corporation, to be used solely for business purposes.

“During fiscal years 2013, 2014 and 2015, Dunleavy used the corporate credit card for personal expenses, without reimbursing the Parade Corporation.

“Dunleavy charged at least $24,000 on the corporate credit card for at least 14 out-of-town trips that were not authorized by the board of directors.

“Dunleavy has not reimbursed the Parade Corporation for the aforesaid amount of at least $24,000.

“Dunleavy also used the corporate credit card to pay for personal items that were wholly unrelated to the business of the Parade Corporation, including male enhancement drugs.

“The total amount of these personal charges by Dunleavy is at least $2,000.

“Despite repeated demands, Dunleavy has refused to pay back the amounts he owes to the Parade Corporation.”

Pipers march up Fifth Avenue at the St. Patrick's Day parade.

Pipers march up Fifth Avenue at the St. Patrick's Day parade.

The counterclaim also asks the court to make Dunleavy pay the parade’s substantial legal costs – well into six figures – needed to defend against Dunleavy’s lawsuit and his other court filings against the parade.  Multiple sources connected to the parade told the Irish Voice that the costs are an especially sore point because the money has been “wasted” on Dunleavy’s action against the parade which has gone on for years.

“Those funds could have been put to much better use than legal fees, for instance, scholarships.  It is a shame this has gone on for so long,” one source said.

“Dunleavy further breached his fiduciary duty to the Parade Corporation by commencing this meritless lawsuit, and subsequently filing six Orders to Show Cause seeking various forms of relief, all of which have been dismissed by this Court,” the counterclaim says.

“Dunleavy’s continued pursuit of his meritless claims in this action is in breach of his fiduciary duty because he is seeking to further only his own personal interests, at the expense of the interests of the parade corporation, which continues to incur legal fees.”

The counterclaim concludes, “Defendants demand the following: (a) judgment in their favor dismissing [Dunleavy’s] Second Amended Complaint with prejudice, (b), on the Counterclaim, damages against John Dunleavy in an amount to be determined at trial, including costs and attorney’s fees.”

Crowds watching the St. Patrick's Day parade in New York City.

Crowds watching the St. Patrick's Day parade in New York City.

The counterclaim was signed by Lahey, who will step down as the parade board’s chairman on June 30.  His replacement is Sean Lane, whose nomination was approved at a board meeting last month.

This is the first time that the parade’s board has initiated legal action against Dunleavy.  Sources say that multiple attempts to settle out of court have been made not only by parade leaders but others in the Irish American community.   Nothing has come from the overtures, at least so far.

Throughout the ongoing legal dispute, Dunleavy has remained a member of the parade’s board.  In June of 2016, he voted in favor of Lahey’s continued chairmanship, a point that the board is focusing on as it continues to defend against Dunleavy’s lawsuit.

In December of 2015, the New York State Attorney General’s Office opened an investigation into Dunleavy’s spending after being notified by the parade board in compliance with New York non-profit regulations. Three months later the office ended its probe as the allegations did not rise to the level that would warrant further action from the office.

The board, as stated in the new counterclaim, is insisting that Dunleavy’s charges were not related to the parade, and wants its money back.

Dunleavy has 10 days from the date of the counterclaim filing to provide the court with a response.