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Judge Rules Penn State Can Purchase Beta Theta Pi House

A Centre County judge on Tuesday ruled that a nearly century-old deed provision gives Penn State the right to acquire the Beta Theta Pi fraternity house property where pledge Timothy Piazza sustained fatal injuries during an alcohol-fueled bid acceptance party in 2017.

Judge Brian Marshall gave the university and the alumni-run house corporation that owns and manages the property, which is surrounded by the University Park campus, six months to negotiate a selling price. If they are not able to reach an agreement after that time, a board of arbitrators will decide how much Penn State should pay to acquire it.

The Beta Theta Pi house has not housed an active fraternity chapter since its recognition was permanently revoked by the university and its charter suspended by its national organization in the weeks after Piazza, a 19-year-old sophomore, died from brain injuries and a lacerated spleen after falling head-first down the basement stairs.

The 1928 deed conveying the property at 220 N. Burrowes St. stipulated that the university had the right to reacquire it if it was no longer used as a fraternity house for the Beta Theta Pi chapter. After the housing corporation declined to entertain university offers for the property, Penn State filed a lawsuit in November 2018 to seek a court-ordered sale.

A three-day non-jury trial was held in October.

“The 1928 deed contains no genuine doubt as to its interpretation,” Marshall wrote as he ruled in favor of Penn State in his verdict on Tuesday.

Attorneys for the alumni house corporation argued that the deed does not state an active chapter of undergraduate student members needed to be living in the house and that the corporation itself constituted the fraternity chapter. They further added that because the national Beta Theta Pi organization did not permanently revoke the charter, it could still reestablish an active chapter at Penn State.

Marshall rejected those arguments, writing that the deed clearly distinguishes between the active chapter and the house corporation. He also wrote that the house corporation is a nonprofit organization, not a fraternity, and has no power to determine whether an active chapter will again be established.

The house corporation also suggested that Penn State used Piazza’s death as an opportunity to reacquire the property.

Marshall wrote that there was no evidence the university revoked recognition in order to purchase the property, but rather that it was clear the university did so as a direct result of the actions that led to Piazza’s death.

University officials did discuss the deed and the future of the property in the weeks and months after Piazza’s death, and contemporaneous records presented at the trial showed Penn State President Eric Barron said the property would not be used in the future as student housing. Barron also had multiple conversations with Piazza’s father, Jim, who suggested potential uses for the property, including demolishing the house or replacing it with an engineering building named in his son’s honor.

Barron testified at the trial, though, that acquiring the house was not a motivation behind banning the fraternity.

“What occurred was just reprehensible. It was awful,” Barron said, according to court transcripts. “It was a case where I believe a young man’s life could have been saved if people cared about him. And as an institution, any death is horrible, but we just couldn’t ignore the evidence that was there and needed to have a very strong message that we just can’t have this happen.”

Vice President for Student Affairs Damon Sims testified that prior to February 2017, Beta Theta Pi had been viewed, and held itself out as, a “chapter of excellence.” A subsequent investigation, however, found the chapter had committed “numerous” alcohol-related hazing violations dating back to 2014.

“What we discovered through this investigation was there was a systematic longstanding effort to do anything but what the chapter should have been doing and what it professed to have been doing,” Sims said. “We had every reason to doubt that this group of people would change their way. And in fact, we had an awful lot of evidence suggesting that this was about as bad a situation as we had seen and that we had to take action that was commensurate with that circumstance.”

The house corporation voluntarily told its student members to vacate the property in the spring of 2017. Since then it has been used intermittently by dues-paying alumni members for football weekend accommodations and for board meetings.

“It is clear to this court that such use does not constitute use as a fraternity or chapter house under the 1928 deed,” Marshall wrote.

In the summer of 2017, the house corporation voted down a sale of the property to alumnus and donor Donald Abbey. Prior to that, university officials discussed purchasing the property from Abbey if he acquired it and if the deed came with no restrictions.

Abbey — a 1970 Penn State graduate, an alumnus of the Beta chapter, and a real estate investment mogul — has his own pending lawsuit against the house corporation. He is seeking repayment of $8.5 million he says he loaned to the chapter over more than a decade for repairs, renovations, and operations for the house.

A funding agreement stated that the money would be repaid with interest if the property stopped being used as a fraternity house if the chapter “decides not to follow the Men of Principle initiative or is determined to be out of compliance…”

The house corporation contends that Abbey held sway over the board president who signed the agreement and that the full board never approved it. Because the house is the corporation’s only significant asset, they argued, Abbey’s lawsuit is essentially a way to gain control of the property.

That case was stayed pending the outcome of the Penn State lawsuit. A pre-trial conference is currently scheduled for March 16.

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About the Author

Geoff Rushton (StateCollege.com)

Geoff Rushton is managing editor for StateCollege.com. Contact him at [email protected] or find him on Twitter at @geoffrushton.

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