Legal Question in Business Law in California

Re: Non-Profit Law Question

This is a difficult question to answer, and you may not get many answers via LawGuru. Unincorporated associations are recognized in California law and several provisions apply to your concerns. See, e.g., Corporations Code sections 18605 to 18640 concerning liability of members, officers, etc. Generally speaking, member exposure to liability is restricted by the code. Sections 21300 to 21310 have to do with an association's "insignia" but do not seem to prevent it from using a name deceptively similar to a corporation. I haven't researched this and I could be wrong.

If your main issue is to protect the association's members, the above laws may be helpful, even reassuring.

If your main mission is to protect the 501(c)(3) nonprofit corporation from name confusion, which is also a valid concern, I believe your best bet is to invoke one or more of the laws respecting trademarks, or perhaps copyright or unfair competition. This is where it gets sticky. You probably need to re-ask under the intellectual property heading, or talk to local attorneys in this field. Whether this approach succeeds may depend upon how much name recognition the theater corporation enjoys.

As a last resort, you might address your issues to the California Attorney General's office; one of their functions is to keep the public from being ripped off by phony charities, and while this association may be legit or semi-legit, the AG might look askance at their style of operation and secrecy.

Re: Non-Profit Law Question

Disband it? Nothing, other than to prohibit it from any connection with your 501, which would kill its reason for existance. You should be happy it is helping, and focus instead on requiring it to enter into an appropriate formal relationship with the 501 that includes protection for both sides.