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Continental is obligated on the bond, but I assume they defaulted because of insolvency. You might want Ed to check on that but I assume that American Continental has no financial means to pay these bonds. You also ask whether there i s ' any means of recovery from those responsible for the purchase of the bonds. As you know, it is not uncommon to sue a board of directors where the board takes some improper or illegal action which results in prejudice to the corporation ( here, association) . Certainly R the possibility exists of maintaining a cause of action against the association board of directors who made this investment. However, there is a good questions as to whether, as a practical matter, such an action should be brought, The hoard consists of lay people as opposed to experienced business people typical of corporate e board, They are dealing with a very complex set of statutes as to firefighters' relief associations, They frequently rely on outside consultants and one would like to know whether these consultants ( such as their attorney) had advised the board, as of 1986, ghat investments were lawful and which were not. If they were not adviser, then that might be a factual defense in their behalf, One would also like to know, in considering the liability of the hoard, to what extent the board invested in this riskier t yp e of bonds. If the investment ratio was very minor in these riskier bonds , then an argument might be made that the investment in such limited amount was a prudent one, notwithstandin g the statutory prohibition against investing in same* Morale of the firefighters would be adversely affected by a lawsuit. All of these factors, I think, combine towards not bringing action against the board of directors, Relentless pursuit of a legal remedy is not always the best choice* wLC /eZa TLC 2