Sunday 15th September 2019

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To Disclose Or Not To Disclose… That Is The Political Question Of The Day

September 9, 2019 Frontpage No Comments

By DEACON MIKE MANNO, JD

Two weeks ago in this column we took up the issue of whether the public disclosure of those contributing to political candidates was, considering the adverse reaction against those persons, an infringement on their free speech rights. As was pointed out in that column, in today’s charged political environment, supporters of a political candidate or issues can easily have their First Amendment rights chilled, knowing that they could face public retribution for their donations.
Coincidentally, as that issue was being published, an appeal was filed with the Supreme Court challenging California’s attempt to obtain the names of donors to certain nonprofit charities. While the issue in the California case is not exactly the same as releasing lists of donors, it is perhaps similar enough to raise concerns about all donors and their free speech rights.
In the California case, a public nonprofit based in Michigan, the Thomas More Center, an organization that defends religious freedom, the sanctity of human life, and family values, is appealing a Ninth Circuit decision that it must give the state a list of all its donors. The Thomas More Center is being represented by the Alliance Defending Freedom (ADF).
The case, in a nutshell, is this: California law requires that nonprofits that receive financial support in California and meet other threshold requirements, must file certain disclosures with the state’s attorney general. As part of that filing the organization must include an IRS Form 990 which describes the mission and significant activities of the entity, its receipts and expenditures, as well as its assets and liabilities.
Schedule B to Form 990 contains the names of all the organization’s donors who meet a certain contribution level. Until a few years ago the attorney general did not require the Schedule B to be attached. But that all changed when then attorney general, now senator and Democratic presidential candidate, Kamala Harris started returning disclosures and threatening fines for those who did not include Schedule B.
Naturally a group like Thomas More is concerned about protecting the identities of its donors, especially when some have already been harassed in similar fashion to those making political donations described in the previous column. Additionally, while the attorney general’s office had promised confidentiality, it had a poor record of delivering on that promise and numerous names from Schedule B forms were listed as “public records” and those that were filed as confidential were easily obtainable from the AG’s website by finagling access identities.
It should be noted that, unlike the California AG’s records, none of the Schedule B forms that the IRS collects are on any website that can be accessed publicly.
So Thomas More filed suit in federal court seeking an injunction against the Schedule B disclosure. The district court agreed with Thomas More and issued the injunction finding that the attorney general’s office routinely leaked confidential records and had no adequate safeguards for their protection. In fact, state officials had testified that they cannot ensure the confidentiality of donors’ names once they are submitted to the state’s registry. The court found that the blanket disclosure rule violated Thomas More and its donors’ freedom of association and noted that some of the donors had received threats and harassment due to premature disclosures.
The state appealed to the Ninth Circuit which, of course, reversed, and in doing so sided with only one other circuit in so holding. Six other circuits held otherwise, which sets the stage for the Supreme Court to step in and articulate a uniform rule.
The hook on which the Ninth Circuit hung its decision was on the issue of the standard used for the determination. The Ninth Circuit asked if the disclosure rule was “substantially related” to a sufficiently important governmental interest: policing charity fraud. The other circuits use the strict scrutiny standard which required the government to have a compelling interest in the information. The Ninth Circuit “exacting scrutiny” standard is what is currently being used to uphold campaign contribution disclosures.
The strict scrutiny standard, however, has been used to protect membership and donor lists for nonprofits since the case of NAACP v. Alabama in 1958. In that case, the state sought to prevent the NAACP, a nonprofit corporation, from operating in Alabama by demanding certain information and membership lists from the organization. The Supreme Court decided in favor of the NAACP, finding that the state’s actions would be likely to interfere with its members’ rights of free association and that there was a substantial likelihood of economic reprisal, loss of employment, physical coercion, and public hostility against them.
So the case reaching the top court simply asks, “Which is the appropriate standard to use?”
Since there is a split in the circuits, two using the relaxed standard the Ninth Circuit uses, and six employing the stricter standard of NAACP, combined with Justice Clarence Thomas’ criticism of that part of the Citizens United v. The Federal Election Commission upholding donor disclosures, it appears that this case very likely will be heard by the Supreme Court.
Added, of course, to the background are the widely documented cases of contributors to certain political or issue organizations being harassed and having their businesses disrupted by protesters. In fact, the attorneys for Thomas More have listed several instances of harassment of its donors, including the boycotting of a pizza chain that is owned by a supporter.
But, I need to remind you once again that this is only a petition for certiorari — that is, an application asking the court to accept the case, which it is not required to do. It will take four justices to agree to hear the case and, under the circumstances, I think that is likely.
ADF Senior Counsel John Bursch made this comment in a press release about the case:
“Forced donor disclosure is a threat to everyone and discourages both charitable giving and participation in the marketplace of ideas. California’s policy makes the First Amendment’s promise of ‘free association’ a pipe dream.
“And donors have good reason to fear in today’s toxic cultural climate, especially with the astounding negligence that California has demonstrated in keeping confidential information from being disclosed that it has no good reason to demand in the first place.”
On the political side, I’d love for someone to ask Kamala Harris if she believes that NAACP v. Alabama is still good law. Let her flip-flop on that for a while.
(You can reach Mike at: DeaconMike@q.com.)

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