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National Arts Club within rights in booting president, court rules

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By Joseph Ax

NEW YORK, Oct 11 (Reuters) - The National Arts Club waswithin its rights when it expelled its longtime president AldonJames after allegations that he cost the club more than $1.7million by misusing its funds and assets, a New York appealscourt ruled Thursday.

The board of directors for the exclusive club, whichoverlooks New York's tony Gramercy Park and has countedluminaries from Theodore Roosevelt to Martin Scorsese asmembers, voted out Aldon James in February, along with his twinbrother, John, and another member, Steven Leitner.

James, who ran the club for 25 years, claimed in a lawsuitthat the directors were biased because they already wereembroiled in litigation against him. A Manhattan state SupremeCourt justice struck down the board's action in March andordered the matter heard before a neutral party.

In a unanimous ruling, however, an intermediary appellatecourt reversed that decision, saying the lower court had"overstepped its authority by interfering with internal,private, club proceedings."

The longstanding spat between the club and James hasexpanded to include the state attorney general's office, whichfiled a lawsuit three weeks ago against James accusing him ofcosting the club more than $1.7 million through mismanagement.

The suit claimed James had taken possession of several clubapartments and filled them with heaps of antiques and clothes,rendering them uninhabitable and depriving the club of rentalmoney. It also asserted that James had used the club's funds tolead a lavish lifestyle, including expensive meals, travel andnumerous purchases at flea markets.

James has denied the allegations.

Roland Riopelle, a lawyer for the club, said Thursday'sruling affirms that a private club "should be able to decide whois a member of the club."

A lawyer for James did not immediately return a request forcomment Thursday. Two lawsuits he has filed against the clubover his termination are pending, though Riopelle said heexpects Thursday's ruling will help resolve them in the club'sfavor.

(Reporting by Joseph Ax; Editing by Bill Trott)

((joseph.ax@thomsonreuters.com)(+1 646-223-6594))

Keywords: USA NEWYORK/ARTSCLUB