A legal dispute that had riveted the chess world and hobbled the United States Chess Federation, the game’s governing body, has been settled — mostly.
Papers filed on Friday in Federal District Court in Lubbock, Tex., stipulate that two former federation board members, the federation and some of its other members are dismissing almost all of their claims and counterclaims. The dispute began with accusations over Internet postings and evolved into a series of lawsuits in several states.
Randy Bauer, a federation board member, said the federation settled “to stop the bleeding.” He said the dispute had “hurt the federation,” adding: “We have had to lay off staff. We have had to reduce services.”
Bill Hall, the organization’s executive director, said the federation, which has annual revenues of about $3 million, had spent nearly $750,000 in legal fees on the cases.
Mr. Hall said that under the settlement, the federation would receive $131,000 from its insurer, the Ansur America Insurance Company. That is in addition to a previous payment of $44,000. The two former federation members, Susan Polgar and Paul Truong, who are married, will receive $39,000 from Ansur.
The dispute began in October 2007, when Samuel H. Sloan, a former board member, filed a lawsuit accusing Ms. Polgar and Mr. Truong of posting thousands of remarks, many obscene or defamatory, on the Internet under his name in an effort to get elected to the federation’s board.
Ms. Polgar and Mr. Troung were elected in the summer of 2007. Mr. Sloan was defeated.
Mr. Sloan sued Mr. Truong and Ms. Polgar, the federation, its board and other federation members. Though Mr. Sloan’s lawsuit was dismissed, in the interim the federation hired Karl S. Kronenberger, a lawyer in San Francisco, to investigate the accusations.
Mr. Kronenberger concluded that Mr. Truong was responsible for the Web postings. Mr. Truong has repeatedly said that he was not.
During his investigation, confidential e-mail messages between Mr. Kronenberger and a subcommittee of the board were posted on the Internet. Mr. Kronenberger and the federation subsequently sued Ms. Polgar and Gregory Alexander, who managed Ms. Polgar’s chess discussion Web site, saying they had intercepted the messages.
Ms. Polgar has denied that accusation. Last July, Mr. Alexander was arrested and charged with identity theft and breaking into the e-mail account of a federation board member. His case, which is not part of the settlement, is still pending.
In August 2008, Ms. Polgar sued the federation, its board and some of its other members, accusing them of libel, slander and business disparagement, among other things. Ms. Polgar, a former women’s world chess champion, lives in Lubbock, where she leads the Susan Polgar Institute for Chess Excellence at Texas Tech University.
In August, Ms. Polgar and Mr. Truong were kicked out of the federation and off the board. Under the settlement, they have agreed that they will never be members again or run for office in the federation.
The settlement does not cover claims made by Ms. Polgar against Mr. Sloan and counterclaims by him against her.
In an interview Thursday, Mr. Truong said that he and Ms. Polgar had spent several hundred thousand dollars on lawsuits, but that they had no regrets. He said the lawsuits were an outgrowth of efforts by the couple to change things in the federation and the resistance they met from “entrenched leadership.”
“This is what happens when you deal with lifelong chess politicians who have a lot to lose,” Mr. Truong said. He added that he was proud that he and Ms. Polgar had been expelled from the federation. “I guess we were barking up the wrong tree.”