U.S. Supreme Court Petitioned On Donor Privacy

September 1, 2015       Mark Hrywna      

A friend of the court brief has been filed with the Supreme Court of the United States on behalf of 58 nonprofit and for-profit fundraisers fighting to keep major donor information confidential from the State of California.

Led by American Target Advertising (ATA), the agency of conservative strategist Richard A. Viguerie, the case in question is Center for Competitive Politics (CCP) v. Kamala Harris, Attorney General of California (pictured). The brief alleges that Harris is imposing conditions that violate federal tax return confidentiality law and multiple constitutional provisions for charities and advocacy nonprofits to reach Californians.

“This is the NAACP v. Alabama of the 21st Century,” said ATA President of Corporate Affairs Mark Fitzgibbons. “Using methods more comprehensive and arbitrary than the Alabama attorney general and other politicians in the 1950s who sought to destroy the civil rights movement by intimidating and silencing activists and their organizations, Ms. Harris and many politicos want to use the power of government to intimidate or even put their grassroots critics out of business. In her unlawful quest, Harris is also violating privacy and association rights of donors to all charities essential for Toquevillian, non-governmental democracy in American society.”

Calls and emails to the California Attorney general’s office were not returned. A copy of the brief can be found here: http://bit.ly/1Xcsmoe

The brief claims: (1) Harris’s demands that nonprofit organizations disclose to her their donor names and addresses on an IRS schedule violate federal law protecting confidential tax return information, violate the landmark 1958 decision NAACP v. Alabama protecting freedom of association, and violate privacy rights; (2) Harris’s demands are an “extortionate unconstitutional condition” to obtain a permit to engage in constitutionally protected rights, and interfere with important privacy rights at the core of American society; and, (3) The California statute delegating unbridled discretion to Harris to determine what registrants must file is unconstitutional on its face for First Amendment reasons, and is an unconstitutional delegation of legislative power.

The U.S. Court of Appeals for the 9th District denied a preliminary injunction to CCP that challenged California’s requirement to file an un-redacted Form 990 Schedule B, disclosing significant donors. The 29-page ruling was handed down in April, affirming an earlier decision by the U.S. District Court for the Eastern District of California.

The Alexandria, Va.-based CCP on May 13 filed an emergency application for an injunction with the United States Supreme Court.

To solicit charitable contributions in California, nonprofits must be registered with the state’s Registry of Charitable Trusts, within the Attorney General’s Office, and file an annual report. The report includes Schedule B of the Form 990, which identifies names and contributions of “significant donors” — those who have contributed more than $5,000 in a single year. Federal law treats the information as confidential.

Having information on significant donors immediately available allows the attorney general to identify suspicious behavior, increase investigative efficiency, and avoid the need for expensive and burdensome audits, the Attorney General’s Office argued, and also cited Hawaii, Mississippi and Kentucky as having the same requirement.

Kentucky’s law allows for either redacted or un-redacted Schedule B to be filed, according a spokeswoman for the Attorney General’s Office, which oversee charities. Hawaii does require Schedule B to be filed but it does not appear in the public registration database, according to Hugh R. Jones, supervising deputy attorney general for the Tax & Charities Division of the Hawaii Department of the Attorney General.

“The ruling asks us to make an impossible choice: either retroactively disclose donors to the attorney general or cease asking Californians to support our work to defend free speech,” CCP President David Keating said via a statement after the 9th Circuit Court’s decision.“Ultimately, the Supreme Court may need to reaffirm its longstanding view that people can join groups without reporting their activity to the government, especially for educational purposes, unless the state can provide a specific and powerful reason for insisting otherwise. It gave no such reason in its briefs,” he said.

The lists of organizations joining ATA in the brief are:

501(c)(3) organizations: The 60 Plus Foundation, American Civil Rights Union, Center for Financial Privacy and Human Rights, Citizens Council for Health Freedom, Citizens in Charge, Citizens Outreach Foundation, Citizens United Foundation, The Conservative Caucus Foundation, Dreamchaser Horse Rescue & Rehabilitation, The Family Action Council of Tennessee, Inc., Family Research Council, Freedom Alliance, Galen Institute, Gun Owners Foundation, Homes for Veterans, Independent Women’s Forum, Ladies of Liberty Alliance, The Leadership Institute, Media Research Center, Project Veritas, Smiling Dog Farms, Tiger Creek Wildlife Refuge/Tiger Missing Link Foundation, Tiger Preservation Center, Traditional Values Coalition Education and Legal Institute, The United States Constitutional Rights Legal Defense Fund, Inc., Virginia Institute for Public Policy, Young America’s Foundation.

IRC 501(c)(4) organizations: The 60 Plus Association, Inc., American Council for Health Care Reform, American Grassroots Council, Inc., American Policy Center, Campaign for Liberty, Citizens Outreach, Inc., Citizens United, Coalition for America (The Weyrich Lunch), Committee for the Republic, Concerned Women for America, Faith & Freedom Coalition, ForAmerica (America, Inc.), Frontiers of Freedom, Grassroots Hawaii Action, Gun Owners of America, Independent Women’s Voice, Liberty Guard, Liberty Initiative Fund, Maryland Taxpayer Association, National Organization for Marriage, Patriot Voices, Securing Equal Education Development, Taxpayers Protection Alliance, Traditional Values Coalition.

For-profit organizations: ClearWord Communications Group, Inc., Donor Trends Corporation, Eberle Associates, Fund Raising Strategies, Inc., McFarland Messaging, MDS Communications.