09 November 2015

Supreme Court Declines Review of Donor Privacy Case

In early September, The Philanthropy Roundtable filed an amicus brief supporting a petition to the Supreme Court for a writ of certiorari to review the judgment of the United States Court of Appeals for the Ninth Circuit in the case of Center for Competitive Politics (CCP) v. Harris. Earlier today, the Court announced its decision not to review the case. David Keating, president of the Center for Competitive Politics, issued the following statement.

“We are very disappointed that the Supreme Court decided not to review the 9th Circuit’s decision. The case is not over and we will study our legal options before making our next move. It is possible, for example, that the Court did not want to review the denial of a preliminary injunction and will decide to hear the case after the lower courts have ruled on the merits of the case.

“We call on Attorney General Kamala Harris to end this failed policy. Last week, it was revealed that over 1,400 supposedly confidential forms listing donors appeared on the state’s website.

“When the Attorney General’s head auditor was asked under oath how many times in the last 10 years the confidential information sought was ‘the reason [you] kicked off [an] investigation’ of a charity, he said ‘I don’t believe any of them.’  The office doesn’t need this information and has demonstrated its inability to keep these forms confidential. It’s time to end this anti-association policy permanently.”

CCP v. Harris focused on the demand of California’s attorney general that all Form 990 submissions made to satisfy the filing requirements of that state’s charitable solicitation rules include an unredacted Schedule B. Schedule B includes the names, addresses, and contribution amounts of all major donors. Such a request has been made of nonprofits before, as noted by George Will in the Washington Post.

“In the 1950s, when the civil rights movement was surging, an Alabama court, pursuant to a state law requiring corporations doing business in the state to produce certain information, ordered the state chapter of the NAACP to produce, among other things, its membership lists. In 1958, the Supreme Court upheld the NAACP’s refusal, finding that forced disclosure would serve no compelling state interest and would deter civil rights supporters from exercising their constitutional rights of free speech and association.”

The Schedule B is submitted to the IRS on a confidential basis, and federal law prohibits the agency from releasing this information to anyone. Similar privacy protections do not exist in California. An editorial in the Washington Examiner expounded on this point.

“There is no reason for California to demand details about donors unless public officials plan to harass donors. It is reasonable to assume this is [attorney general Kamala] Harris’s probable purpose. There is no statute requiring it; it’s something that the attorney general, who happens to be a candidate for Senate, demanded on her own.”

The Manhattan Institute’s Howard Husock, writing in the Chronicle of Philanthropy, raised concern over the precedent set by justifying the violation of donor privacy in the interest of “generalized law-enforcement interests.”

“It is one thing for state officials, having been alerted to the possibility of wrongdoing, to request otherwise confidential records. It’s quite another to maintain files of all donors just in case some reason for suspicion might, at some point, arise.”

The Wall Street Journal similarly argued:

“If government officials really need donor information to enforce the law, they can use the regular legal method of establishing cause to suspect a crime and subpoenaing additional information. The question for the Supreme Court is whether Americans still have a right to associate in private, or whether politicians can compel disclosure that chills speech and damages the First Amendment.”

Our amicus brief reflected our core belief in philanthropic freedom – the right of Americans to choose how and where to spend their charitable assets – and our commitment to safeguard the freedom of donors and private foundations to carry out their diverse charitable goals and missions, in order to preserve their distinctive contributions. Donor privacy and confidentiality are essential to a vibrant civil society, and unwarranted state incursions into private charitable giving will chill the exercise of First Amendment freedoms which insure that donors may give even to controversial philanthropic causes—such as the 1950’s civil rights movement referenced by Will—without fear of harassment and reprisal. Donor privacy also protects those who choose to give anonymously for a variety of good reasons, including deeply held moral or religious beliefs, a sense of humility, a wish to lead a more private life, and the desire to minimize solicitations from other organizations.