U.S. Supreme Court leans toward conservative groups on concealing donors
Reuters
Published Apr 26, 2021 06:17AM ET
Updated Apr 26, 2021 12:45PM ET
By Lawrence Hurley
WASHINGTON (Reuters) -Conservative U.S. Supreme Court justices on Monday appeared sympathetic to a challenge by two conservative groups to a California requirement that tax-exempt charities disclose to the state the identity of their top financial donors.
The nonprofit groups - the Americans for Prosperity Foundation and the Thomas More Law Center - argued that California's policy in place for the past decade violates the U.S. Constitution's First Amendment guarantees of freedom of speech and association. They have said that if the information becomes public it could lead to harassment or threats to donors.
Democratic-governed California, the most populous U.S. state, has said the donor information is required from such groups as part of the state attorney general's duty to prevent charitable fraud.
Conservative justices, who make up a 6-3 majority on the court, appeared sympathetic during Monday's arguments in the case to the challengers' contention that the measure should be struck down in full.
There appeared little appetite for a middle ground proposal backed by President Joe Biden's administration to uphold the state policy but send the case back to lower courts to explore whether the groups could pursue a challenge based on how the state applied the rules to them.
Conservative Justice Clarence Thomas expressed concern that donor identities becoming publicly known could deter people from donating to groups with contentious views.
"In this era there seems to be quite a bit of loose accusations about organizations. For example, an organization that has certain views might be accused of being a white supremacist organization or racist or homophobic, something like that, and as a result become quite controversial," Thomas said.
The Thomas More Law Center is a conservative Catholic legal group. The Americans for Prosperity Foundation, which funds education and training on conservative issues, is the sister organization of Americans for Prosperity, a conservative political advocacy group - both founded by conservative billionaire businessman Charles Koch and his late brother David.
California requires that charities provide a copy of the tax form they file with the U.S. Internal Revenue Service that lists donors who contribute large amounts. Larger groups have to disclose donors who contribute $200,000 or more in any year. That information is not posted online and is kept confidential but some data has been leaked in the past.
The case could have broad ramifications if the Supreme Court sets a new standard that could make it easier for groups, including those active on political issues, to withhold the identity of donors. The court in the past has been hostile to political campaign finance restrictions - it ruled in 2010 that corporations and other outside groups could spend unlimited funds in elections - but has upheld disclosure requirements.
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Liberal Justice Stephen Breyer expressed concern about the impact of a ruling on campaign finance, noting that in the political context "the interest is even stronger in people being able to give anonymously."
The two groups are backed in the case by nonprofit organizations across the ideological spectrum including liberal groups such as the American Civil Liberties Union and the Human Rights Campaign, an LGBT rights group, as well as business groups such as the U.S. Chamber of Commerce.
New York, which is one of several states with a similar requirement, filed a brief on behalf of 16 states supporting California.
The San Francisco-based 9th U.S. Circuit Court of Appeals in 2018 reversed a federal judge's ruling in favor of the groups, prompting them to appeal to the Supreme Court.
Former California Attorney General Xavier Becerra, who became U.S. secretary of health and human services last month, had been defending the policy. His successor, Democrat Rob Bonta, was confirmed by California's legislature last week.
A ruling is expected by the end of June.
Written By: Reuters
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