Petition for Writ of Certiorari — Thomas More Law Center, Petitioner v. Rob Bonta, Attorney General of California
Supreme Court briefAug 26, 2019
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NO. __________
IN THE
Supreme Court of the United States
THOMAS MORE LAW CENTER,
Petitioner,
v.
XAVIER BECERRA, IN HIS OFFICIAL CAPACITY
AS ATTORNEY GENERAL OF THE STATE OF CALIFORNIA,
Respondent.
On Petition for Writ of Certiorari to the
United States Court of Appeals for the Ninth Circuit
PETITION FOR A WRIT OF CERTIORARI
LOUIS H. CASTORIA
KAUFMAN DOLOWICH &
VOLUCK, LLP
425 California Street
Suite 2100
San Francisco, CA 94104
(415) 926-7600
lcastoria@kdvlaw.com
KRISTEN K. WAGGONER
JOHN J. BURSCH
Counsel of Record
DAVID A. CORTMAN
RORY T. GRAY
ALLIANCE DEFENDING
FREEDOM
440 First Street, N.W.
Suite 600
Washington, D.C. 20001
(616) 450-4235
jbursch@ADFlegal.org
Counsel for Petitioner
i
QUESTIONS PRESENTED
Petitioner Thomas More Law Center is a Michigan
501(c)(3) that defends religious freedom, family
values, and the sanctity of life. To fundraise, the Law
Center registered with the California Attorney General and made annual filings to his Register of Charitable Trusts. After a decade of accepting these filings
without complaints, the Attorney General deemed
them insufficient because, although they included the
Law Center’s IRS Form 990, they omitted Schedule B
to that form, which identifies the Law Center’s major
donors. After the Attorney General threatened to
suspend its nonprofit registration and personally fine
its directors and tax preparer, the Law Center filed
suit to protect donor anonymity.
The district court enjoined the Attorney General’s
donor-disclosure rule because his office had an extensive record of disclosing that confidential material,
and donors were likely to face harassment and threats
as a result. Because this disclosure rule arises outside
the electoral context, six circuits would apply strict
scrutiny. But the Ninth Circuit upheld the rule,
joining the Second Circuit in holding that “there is
only a single test—exacting scrutiny—that applies
both within and without the electoral context.”
App.133a–34a. The questions presented are:
1. Whether exacting scrutiny or strict scrutiny
applies to disclosure requirements that burden nonelectoral, expressive association rights.
2. Whether California’s disclosure requirement
violates charities’ and their donors’ freedom of
association and speech facially or as applied to the
Law Center.
ii
PARTIES TO THE PROCEEDING AND
CORPORATE DISCLOSURE
Petitioner is Thomas More Law Center. Respondent is Xavier Becerra, successor to Kamala Harris as
Attorney General of the State of California. In the
Ninth Circuit, Petitioner’s case was combined for
decision with Americans for Prosperity Foundation’s
similar lawsuit against Respondent.
Petitioner Thomas More Law Center is a Michigan
nonprofit corporation with no parent corporation. No
publicly held company owns 10% or more of its stock.
LIST OF ALL PROCEEDINGS
U.S. Court of Appeals for the Ninth Circuit, Nos.
16-56855 & 16-56902, Thomas More Law Center v.
Becerra, judgment entered September 11, 2018, en
banc review denied March 29, 2019, mandate
withdrawn August 5, 2019.
U.S. Court of Appeals for the Ninth Circuit, No.
15-55911, Thomas More Law Center v. Harris,
judgment entered December 29, 2015, en banc review
denied April 6, 2016.
U.S. District Court for the Central District of
California, No. 2:15-cv-03048-R-FFM, final judgment
entered November 16, 2016.
iii
TABLE OF CONTENTS
QUESTIONS PRESENTED ....................................... i
PARTIES TO THE PROCEEDING AND
CORPORATE DISCLOSURE .............................. ii
TABLE OF AUTHORITIES ..................................... ix
DECISIONS BELOW................................................. 1
STATEMENT OF JURISDICTION .......................... 2
PERTINENT CONSTITUTIONAL,
STATUTORY, AND REGULATORY
PROVISIONS........................................................ 2
INTRODUCTION ...................................................... 3
STATEMENT OF THE CASE ................................... 5
A. The Attorney General’s blanket disclosure
rule. .................................................................. 5
B. The Attorney General’s history of
disclosing donor information........................... 8
C. The Attorney General’s demand that the
Law Center divulge its Schedule B. ............... 9
D. Lower Court Proceedings .............................. 11
REASONS FOR GRANTING THE WRIT............... 16
iv
I. The Ninth Circuit’s ruling conflicts with this
Court’s precedent, which applies strict
scrutiny to disclosure and related mandates
outside the electoral context............................... 17
A. Freedom of association protects charities
against government attempts to unmask
their anonymous donors. ............................... 17
B. This Court applies strict scrutiny to
disclosure rules—like the Attorney
General’s—that burden freedom of
association outside the electoral context. ..... 21
C. This Court designed “exacting” scrutiny for
disclosures related to elections and has
never applied that lower standard outside
the electoral context. ..................................... 23
D. The Ninth Circuit’s contrary ruling
jeopardizes association rights. ...................... 26
1. Under strict scrutiny, the Attorney
General’s blanket-disclosure rule is
facially unconstitutional. ......................... 27
2. The Attorney General’s disclosure
mandate is unconstitutional as applied
under any standard.................................. 29
II. The Ninth Circuit’s decision intensifies a
mature, 6-2 circuit split. ..................................... 32
III.This case is an ideal vehicle to resolve a
circuit conflict that has severe ramifications
for charities nationwide. ..................................... 35
CONCLUSION ......................................................... 38
v
APPENDIX TABLE OF CONTENTS
United States Court of Appeals for the Ninth
Circuit,
Opinion in 16-56855 and 16-56902
Issued September 11, 2018 ...................................... 1a
United States District Court for the Central
District of California,
Order for Judgment in Favor of Plaintiff
in 2:15-cv-03048
Issued November 16, 2016 ..................................... 51a
United States District Court for the Central
District of California,
Order Denying Summary Judgment
in 2:15-cv-03048
Issued July 18, 2016 .............................................. 68a
United States District Court for the Central
District of California,
Order Modifying Preliminary Injunction
in 2:15-cv-03048
Issued January 5, 2016 .......................................... 74a
United States Court of Appeals for the Ninth
Circuit,
Opinion in 15-55911
Issued December 29, 2015 ..................................... 76a
United States District Court for the Central
District of California,
Order Issuing Preliminary Injunction
in 2:15-cv-03048
Issued May 19, 2015 .............................................. 90a
vi
United States District Court for the Central
District of California,
Order Granting Temporary Protective Order
in 2:15-cv-03048
Issued April 29, 2015 ............................................. 97a
United States Court of Appeals for the Ninth
Circuit,
Order Denying Petitions for Rehearing En Banc
in 16-56855 and 16-56902,
Issued March 29, 2019 ......................................... 104a
United States Court of Appeals for the Ninth
Circuit,
Order Denying Petition for Panel Rehearing or
Rehearing En Banc in 15-55911
Issued April 6, 2016 ............................................. 146a
California Gov. Code § 12585 .............................. 148a
California Gov. Code § 12586 .............................. 149a
California Gov. Code § 12590 .............................. 150a
11 California Code of Regulations § 300 ............. 151a
11 California Code of Regulations § 301 ............. 152a
11 California Code of Regulations § 303 ............. 153a
11 California Code of Regulations § 305 ............. 154a
11 California Code of Regulations § 306 ............. 155a
11 California Code of Regulations § 310 ............. 156a
11 California Code of Regulations § 315 ............. 157a
vii
11 California Code of Regulations § 316 ............. 157a
26 U.S.C. 6104 ...................................................... 158a
26 U.S.C. 7213 ...................................................... 159a
26 U.S.C. 7213A ................................................... 160a
26 C.F.R. § 1.6033-2 ............................................. 161a
Letter from California to Thomas More dated
March 6, 2012 ....................................................... 163a
Letter from Thomas More to California dated
March 14, 2012 ..................................................... 165a
Letter from Thomas More Counsel to California
dated April 11, 2012 ............................................. 167a
Letter from California to Thomas More dated
April 19, 2013 ....................................................... 169a
Letter from Thomas More to California dated
April 24, 2013 ....................................................... 171a
Letter from California to Thomas More dated
October 22, 2013................................................... 173a
Letter from Thomas More to California dated
October 28, 2013................................................... 175a
Letter from California to Thomas More dated
April 23, 2014 ....................................................... 177a
Letter from California to Thomas More dated
October 31, 2014................................................... 179a
viii
Letter from California to Thomas More dated
March 24, 2015 ..................................................... 181a
Letter from Thomas More Counsel to California
dated April 7, 2015 ............................................... 184a
ix
TABLE OF AUTHORITIES
Cases
Americans for Prosperity Foundation v. Harris,
182 F. Supp. 3d 1049 (C.D. Cal. 2016) .................. 8
Bates v. City of Little Rock,
361 U.S. 516 (1960) .................................. 18–19, 21
Boy Scouts of America v. Dale,
530 U.S. 640 (2000) ........................................ 18, 22
Brown v. Socialist Workers ’74 Campaign
Committee,
459 U.S. 87 (1982) ................................................ 24
Buckley v. Valeo,
424 U.S. 1 (1976) ........................................... passim
Center for Competitive Politics v. Harris,
784 F.3d 1307 (9th Cir. 2015) ........................ 11, 28
Citizens United v. FEC,
558 U.S. 310 (2010) ....................................... passim
Citizens United v. Schneiderman,
882 F.3d 374 (2d Cir. 2018) ................................. 32
Clark v. Library of Congress,
750 F.2d 89 (D.C. Cir. 1984) .......................... 34–35
Davis v. FEC,
554 U.S. 724 (2008) .............................................. 25
Familias Unidas v. Briscoe,
619 F.2d 391 (5th Cir. 1980) .......................... 33–34
FEC v. National Conservative Political Action
Committee,
470 U.S. 480 (1985) .............................................. 17
x
Gibson v. Florida Legislative Investigation
Committee,
372 U.S. 539 (1963) .............................17–18, 21–22
Humphreys, Hutcheson & Moseley v. Donovan,
755 F.2d 1211 (6th Cir. 1985) .............................. 34
John Doe No. 1 v. Reed,
561 U.S. 186 (2010) .............................14, 19, 25, 36
Knox v. Service Employees International Union,
567 U.S. 298 (2012) ........................................ 19, 22
Kusper v. Pontikes,
414 U.S. 51 (1973) .......................................... 17–18
Louisiana ex rel. Gremillion v. NAACP,
366 U.S. 293 (1961) .................................. 19, 22, 30
Master Printers of America v. Donovan,
751 F.2d 700 (4th Cir. 1984) ................................ 33
McCutcheon v. FEC,
572 U.S. 185 (2014) ........................................ 20, 25
McIntyre v. Ohio Elections Commission,
514 U.S. 334 (1995) .............................................. 20
NAACP v. Alabama,
357 U.S. 449 (1958) ....................................... passim
NAACP v. Alabama,
377 U.S. 288 (1964) .............................................. 22
NAACP v. Button,
371 U.S. 415 (1963) ........................................ 23, 30
Pleasant v. Lovell,
876 F.2d 787 (10th Cir. 1989) .............................. 34
Reed v. Town of Gilbert,
135 S. Ct. 2218 (2015) .......................................... 21
xi
Riley v. National Federation of the Blind of North
Carolina, Inc.,
487 U.S. 781 (1988) .............................18, 20, 29–30
Roberts v. U.S. Jaycees,
468 U.S. 609 (1984) .............................................. 22
Rumsfeld v. Forum for Academic & Institutional
Rights, Inc.,
547 U.S. 47 (2006) ................................................ 18
Secretary of State of Maryland v. Joseph H. Munson
Co.,
467 U.S. 947 (1984) .................................. 18, 28–29
Shelton v. Tucker,
364 U.S. 479 (1960) ........................................ 22, 28
Turner Broadcasting System, Inc. v. FCC,
520 U.S. 180 (1997) .............................................. 24
United States v. Comley,
890 F.2d 539 (1st Cir. 1989) ................................ 33
Village of Schaumburg v. Citizens for a Better
Environment,
444 U.S. 620 (1980) ........................................ 18, 28
Statutes
26 U.S.C. 6104 ............................................................ 7
26 U.S.C. 7213 ............................................................ 7
26 U.S.C. 7213A ......................................................... 7
28 U.S.C. 1331 ............................................................ 2
28 U.S.C. 1254(1) ....................................................... 2
28 U.S.C. 1291 ............................................................ 2
xii
Regulations
11 Cal. Code Regs. 301 ............................................... 5
11 Cal. Code Regs. 303 ............................................... 5
11 Cal. Code Regs. 305 ............................................... 5
11 Cal. Code Regs. 310 (2015) ................................... 6
11 Cal. Code Regs. 310(b) (2016) ............................... 6
26 C.F.R. 1.6033-2(A)(2) ............................................ 5
Cal. Gov. Code 12581 ................................................. 5
Cal. Gov. Code 12582.1 .............................................. 5
Cal. Gov. Code 12584-86 ............................................ 5
Cal. Gov. Code 12586-87 ............................................ 5
Cal. Gov. Code 12590 ................................................. 6
Constitutional Provisions
U.S. Const. amend I ................................................... 2
U.S. Const. amend XIV .............................................. 2
1
DECISIONS BELOW
The district court’s unreported ruling granting
Petitioner’s application for temporary protective
order is reprinted in the Appendix (“App.”) at
App.97a–103a.
The district court’s unreported opinion granting
Petitioner’s motion for preliminary injunction is
reprinted at App.90a–96a. The Ninth Circuit’s
decision vacating the preliminary injunction with
instructions is reported at 809 F.3d 536 (9th Cir.
2015) and reprinted at App.76a–89a. The district
court’s unreported order enjoining the Attorney
General from publicly disclosing the Law Center’s
Schedule B forms is reprinted at App.74a–75a.
The district court’s unreported ruling denying the
parties’ competing motions for summary judgment is
reprinted at App.68a–73a.
The district court’s opinion granting Petitioner’s
motion for a permanent injunction is unreported but
available at No. 2:15-cv-03048-R-FFM, 2016 WL
6781090 (C.D. Cal. Nov. 16, 2016), and reprinted at
App.51a–67a. The Ninth Circuit’s decision vacating,
reversing, and remanding is reported at 903 F.3d
1000 (9th Cir. 2018) and reprinted at App.1a–50a.
The Ninth Circuit’s order denying rehearing en banc
with five judges dissenting is reported at 919 F.3d
1177 (9th Cir. 2019) and reprinted at App.104a–45a.
2
STATEMENT OF JURISDICTION
On September 11, 2018, the Ninth Circuit issued
its opinion vacating, reversing, and remanding, and
on March 29, 2019, the Ninth Circuit denied
rehearing en banc. Lower courts had jurisdiction
under 28 U.S.C. 1331 and 28 U.S.C. 1291. On June 5,
2019, Justice Kagan extended the time to file a
petition for a writ of certiorari to August 26, 2019.
This Court has jurisdiction under 28 U.S.C. 1254(1).
PERTINENT CONSTITUTIONAL,
STATUTORY, AND REGULATORY
PROVISIONS
The First Amendment to the United States
Constitution provides, in relevant part: “Congress
shall make no law . . . abridging the freedom of speech,
. . . or the right of the people peaceably to assemble.”
U.S. Const. amend I.
The Fourteenth Amendment to the United States
Constitution provides, in relevant part: “[N]or shall
any State deprive any person of life, liberty, or
property, without due process of law . . . .” U.S. Const.
amend XIV.
Excerpts from relevant California statutes appear
at App.148a–50a, and excerpts from California
regulations appear at App.151a–57a. Excerpts from
pertinent federal statutes are included at App.158a–
61a, and excerpts from federal regulations appear at
App.161a–62a.
3
INTRODUCTION
The California Attorney General demands that
thousands of nonprofits fundraising in the State
annually turn over their major donors’ names and
addresses. After a bench trial, the district court found
that the Attorney General’s Office leaks confidential
records like a sieve. The Registry of Charitable Trusts
is understaffed and poorly funded. It negligently
posted nearly 1,800 IRS Form 990 Schedule Bs online,
including one listing Planned Parenthood Affiliates of
California’s supporters. The district court further
found that once the State posts donors’ personal
information on the internet, it remains public forever
and puts donors’ and their families’ privacy at risk.
For those associated with charities that speak on
contentious matters—like Petitioner the Thomas
More Law Center (the “Law Center”)—disclosing
donor information to the Attorney General’s Registry
poses an imminent danger of hate mail, violence,
ostracization, and boycotts. Only the most stalwart
supporters will give money under such a toxic cloud.
Most will reasonably conclude that the risk of
association is too great, with the result that groups
who make the most threats will effectively shut down
those with whom they disagree.
Undeterred by these severe First Amendment
harms, the Attorney General continues to demand
donor disclosure. The Attorney General does so even
though his office hardly ever uses donor information
for any purpose, such data never launches or ends
fraud investigations, and the Attorney General may
obtain donor information in less overbroad and
intrusive ways.
4
The district court rightly enjoined the Attorney
General’s blanket disclosure requirement, which the
Attorney General acknowledged was at best a tool of
convenience. The Ninth Circuit reversed, applying
“exacting scrutiny,” a lenient standard designed for
disclosures that play a unique role in keeping
elections fair and honest. Buckley v. Valeo, 424 U.S.
1, 64–68 (1976) (per curiam). In so doing, the Ninth
Circuit cemented a circuit split between Second and
Ninth Circuit rulings that apply exacting scrutiny to
disclosure requirements outside the electoral context,
and decisions by the First, Fourth, Fifth, Sixth,
Tenth, and D.C. Circuits that apply strict scrutiny to
disclosures that are not election related. NAACP v.
Alabama, 357 U.S. 449, 463 (1958).
In the Second and Ninth Circuits, charities and
donors have no meaningful protection against disclosure mandates. As the en banc dissent explained,
states in those circuits only need to make “self-serving
assertions about efficient law enforcement” to overcome “threats, hostility, and economic reprisals” that
donors are likely to experience. App.128a. This low
bar eviscerates First Amendment protections this
Court has long recognized and puts donors and charities with contentious views at risk. App.127a–28a.
The Law Center and its clients speak on public
issues. Its employees, donors, and clients have faced
death threats, harassment, obscene emails, pornographic letters, and nationwide boycotts. Yet the
Ninth Circuit refused to protect the Law Center’s
donor information, jeopardizing its ability to fund
advocacy. This Court should grant review, resolve the
circuit conflict, and reaffirm that freedom of association and speech is vital for advocacy and democracy.
5
STATEMENT OF THE CASE
A. The Attorney General’s blanket disclosure rule.
California’s Supervision of Trustees and Fundraisers for Charitable Purposes Act requires nonprofits
fundraising in the state to register with the Attorney
General and file periodic reports. Cal. Gov. Code
12581, 12582.1, 12584-86. The Act leaves the content
of these reports to the Attorney General’s discretion.
Cal. Gov. Code 12586-87. By regulation, the Attorney
General requires charities to file with the Registry of
Charitable Trusts an Annual Registration Renewal
Fee Report, as well as the nonprofit’s annual IRS
Form 990. 11 Cal. Code Regs. 301, 303, 305.
For many years, the Attorney General interpreted
these disclosure regulations as merely requiring
charities to submit Form 990s without the schedules.
The Attorney General’s Office then abruptly changed
course. With no evidence of pervasive wrongdoing by
charitable trusts in California, it demanded that the
thousands of nonprofits fundraising in California
submit their Form 990s along with all attachments,
including Schedule B, as part of their annual reports.
Form 990’s Schedule B includes donors’ names,
complete addresses, total contributions, and types of
donations. Charities must generally disclose the
identities of donors who contributed $5,000 or more
on their Schedule Bs. 26 C.F.R. 1.6033-2(A)(2)(ii)(f).
But, in some instances, charities may opt instead to
list donors who gave more than 2% of the nonprofits’
total contributions for the year. 26 C.F.R. 1.60332(A)(2)(iii)(a).
6
Until well after this litigation began, no California
statutory or regulatory provision even nominally
guarded donors’ names and addresses from public
disclosure. To the contrary, the Charitable Purposes
Act mandated that reports filed with the Attorney
General generally be open to public inspection, Cal.
Gov. Code 12590, and the Attorney General’s
regulations made no exception for donors’ personal
information, 11 Cal. Code Regs. 310 (2015). The
Attorney General did have a longstanding informal
policy, which could be changed at any time, against
disclosing Schedule B forms to the public. But
employees inadvertently violated this policy regularly, and no penalties or terminations resulted.
Only after the blanket disclosure rule was
challenged in court did the Attorney General amend
the regulations to shield donor information from
disclosure—at least on paper. 11 Cal. Code Regs.
310(b) (2016). The Attorney General’s Office also
belatedly devised a system of automated and personal
reviews to identify documents that should be
classified as confidential and not made public online.
Yet the Attorney General’s new system does not
prevent employees and contractors from downloading, emailing, or printing donors’ names and
addresses and then disclosing them publicly. And the
Registrar admitted at trial that he cannot ensure the
confidentiality of donors’ identities once they are
submitted to the Registry. Second Br. of Appellee and
Cross-Appellant 19–20, No 16-56902 (9th Cir. Oct. 20,
2017) (“Appellee Br.”).
In contrast, the IRS has no publicly accessible
website through which donor privacy may even
potentially be violated. Congress bars the Secretary of
7
the Treasury from disclosing donors’ names or
addresses to the public. 26 U.S.C. 6104(b) & (d)(3)(A).
And any federal employee or contractor who even
accesses donors’ confidential information in an
unauthorized manner is subject to one year’s
imprisonment, a $1,000 fine, and dismissal. 26
U.S.C. 7213A. Those who willfully disclose supporters’ identities without authorization face even
harsher punishment: up to five years’ imprisonment,
up to $5,000 in fines, and dismissal. 26
U.S.C. 7213(a)(1).
Federal safeguards even covers third parties who
broadcast or solicit charities’ Schedule B data. Any
third party who receives donors’ confidential
information and prints or publishes it in an
unauthorized manner may be imprisoned for up to
five years and fined up to $5,000. 26
U.S.C. 7213(a)(3). Third parties who pay for donors’
names and addresses are subject to the same stiff
punishment. 26 U.S.C. 7213(a)(4).
As for California, its laws provide no penalties for
accessing, leaking, publishing, or soliciting donors’
names and addresses. That is likely because the
California Assembly never contemplated making
charities turn over this data in the first place.
8
B. The Attorney General’s history
disclosing donor information.
of
At one point, anyone could use a web browser to
access all the Registry’s confidential documents.
Appellee Br. 14; App123a. These records were theoretically invisible to the public eye, but they could be
revealed by altering a single digit at the end of a URL.
App.39a. This simple maneuver made all the
Schedule Bs that the Registry classified as
“confidential” publicly available.
In addition, Registry employees authorized access
to nearly 1,800 confidential Schedule Bs by
mislabeling them as “public” documents. App.123a.
This resulted in public disclosure of Planned Parenthood Affiliates of California, Inc.’s 2009 Schedule B,
containing the names and addresses of hundreds of
donors. App.123a. Only 7-10 days before the Law
Center’s trial, at least 40 Schedule Bs were still
erroneously classified as “public” documents on the
Registry’s website. Appellee Br. 14; App.123a–24a.
Roughly 1,500 other “confidential” documents were
also accessible via a quick web search. Appellee Br.
15.
The Attorney General’s failure to maintain the
confidentiality of nonprofits’ Schedule B forms was
systematic and foreseeable. Isolating Schedule Bs and
other confidential material is tedious, and there is
ample room for error. Ams. for Prosperity Found. v.
Harris, 182 F. Supp. 3d 1049, 1057 (C.D. Cal. 2016).
The Attorney General also perennially underfunds,
understaffs, and ill-equips the Registry to safeguard
confidential information. Ibid.
9
Just as important, by placing thousands of
confidential documents online, the Attorney General
created an ideal target for attacks. One individual
overloaded the Registry’s website to download
confidential documents even during this litigation.
Appellee Br. 15. Nonetheless, the Attorney General’s
Office has made no serious effort to evaluate or bolster
its cyber defenses. Id. at 19–20.
C. The Attorney General’s demand that the
Law Center divulge its Schedule B.
The Law Center is a 501(c)(3) organization based
in Michigan that defends and promotes America’s
Judeo-Christian heritage, religious freedom, moral
and family values, and the sanctity of human life.
Roughly 5% of its donors are California residents. The
Law Center operated as a charity in good standing
with the Attorney General from 2001 until 2012. For
over a decade, the Law Center’s annual reports to the
Registry included its IRS Form 990 but not the form’s
Schedule B. The Attorney General never investigated
the Law Center, and no one ever filed a complaint
against it.
In March 2012, the Registry sent the Law Center
a letter stating that its 2010 filing was “incomplete”
because it lacked Schedule B’s contributor names and
addresses. App.163a–64a. The Attorney General’s
Office demanded that the Form 990 filed with the
Registry be identical to that filed with the IRS.
App.163a. The Law Center responded that it had
never included its Schedule B “in any previous filing
for the State of California” and requested the legal
basis for this sudden policy change. App.165a.
10
The Registry never responded. Instead, it sent a
series of letters warning that the Law Center’s filings
for 2010, 2011, 2012, and 2013 were deficient because
they did not include “the names and addresses of
contributors.” App.169a–70a, 173a–74a, 177a–80a.
The Law Center retained Michigan counsel who
asked the Registry to direct all future communication
to him and provide counsel “the legal authority” for
the Attorney General’s demand for donor disclosure.
App.167a.
The Attorney General’s Office honored neither
request. Instead, it sent another letter threatening to
suspend the Law Center’s non-profit registration and
impose personal fines on its directors, officers, and
return preparers unless the Law Center handed over
its Schedule Bs within 30 days. App.181a–83a. In
response, the Law Center’s counsel noted the
“significant Constitutional questions involved and the
irreparable harm that would occur if my client is
required to provide Schedule B” information.
App.185a. The Law Center’s counsel asked the
Attorney General’s Office to defer any enforcement
action until existing legal challenges were resolved.
App.185a–86a. He explained that otherwise the Law
Center would be forced to file a lawsuit of its own.
App.186a. But the Attorney General would not defer,
forcing the Law Center to bring this lawsuit to protect
its donors’ anonymity.
11
D. Lower Court Proceedings
The Law Center filed suit in the U.S. District
Court for the Central District of California, alleging
that the Attorney General’s blanket disclosure rule
violated the Law Center’s and its donors’ freedom of
association. It requested a temporary restraining
order enjoining the Attorney General from demanding—or punishing the Law Center for refusing to
provide—donor names and addresses. The district
court granted that request, App.97a–103a, and later
converted the TRO into a preliminary injunction
because persons associated with the Law Center had
experienced threats, harassment, and other chilling
conduct, and the Attorney General had successfully
regulated charities without collecting Schedule Bs for
over a decade, App.94a–96a.
On appeal, the Ninth Circuit believed it was bound
by a prior decision declaring the Attorney General’s
Schedule-B-disclosure regime facially constitutional.
App.79a (citing Ctr. for Competitive Politics v. Harris,
784 F.3d 1307 (9th Cir. 2015)). Although an asapplied challenge was possible, the panel rebuffed the
Law Center’s claim based on an assumption that the
Registry would keep Schedule B forms confidential.
App.78a, 81a–85a. The Ninth Circuit applied exacting
scrutiny and deemed it irrelevant that the Attorney
General sought information about the Law Center’s
non-California donors because narrow tailoring was
not required. App.79a, 84a–85a. It doubted that any
charity could overcome the State’s “‘compelling interest’ in enforcing the law.” App.85a. But, because
California law appeared to make Schedule B forms
open to public inspection and the Attorney General
12
only promised a toothless confidentiality policy, the
Ninth Circuit approved a limited injunction that
allowed the Attorney General to collect Schedule Bs
while prohibiting public disclosure. App.86a–88a.
The Ninth Circuit denied en banc rehearing.
App.146a–47a. Meanwhile, the district court modified
its preliminary injunction per the Ninth Circuit’s
ruling. App.74a–75a. The district court later denied
the parties’ cross-motions for summary judgment,
App.68a–73a, and conducted a four-day bench trial.
Following trial, the district court granted final
judgment to the Law Center on its as-applied claim.
App.51a–67a. The court found that collecting Schedule Bs did not substantially assist the Attorney General’s monitoring of charities: out of 540 investigations over 10 years, the Attorney General’s Office had
only used Schedule B information in five cases, and
even then admitted the same data could have been
obtained other ways, such as through targeted
subpoenas or audits. App.55a. Because the Attorney
General effectively monitored charitable organizations for decades without Schedule Bs, the district
court concluded that the Attorney General could
effectively regulate the Law Center by narrower
means. App.57a–58a, 66a. And it distinguished freeassociation rulings in “the electoral context” that
required no narrow tailoring whatsoever. App.56a.
The district court further found that the Attorney
General’s new “protective” regulation would be of cold
comfort to donors. App.62a–63a. That regulation
formalized a confidentiality policy that the Registry
had violated with “a proven and substantial history of
13
inadvertent disclosures.” App.62a. Donors would still
reasonably fear public disclosure. App.63a.
This was particularly true of the Law Center’s
donors because it advocates on issues that “arouse
intense passions,” and the Law Center’s speech had
already produced “threats, harassing calls, intimidating and obscene emails, and even pornographic
letters.” App.59a. Supporting the Law Center’s views
had resulted in opponents wrongly labeling its cofounder and major donor, Thomas Monaghan, one of
the “most antigay persons in the country” and in a
national boycott of his chain of pizza-restaurants.
App.60a. One donor even anonymously sent cash to
the Law Center out of fear of creating any traceable
link, and the district court found that other donors
likely felt the same way. App.59a–61a. That finding
was supported by the unrebutted expert testimony of
Dr. Paul Schervish, the author of the only peerreviewed sociological study of anonymous-donor
behavior. Appellee Br. 12–14.
The irreparable harm to the Law Center’s and its
donors’ freedom of association and speech outweighed
the Attorney General’s interest in investigative
convenience and efficiency. App.66a. For decades, the
Attorney General protected the public against charitable fraud without Schedule B information and could
do so again, as all but three states do. App.66a. But
the “Law Center would be hard-pressed to regain the
trust of its donors and continue the exercise of its
First Amendment rights should it be required to
violate the trust and desires of its donors.” App.66a.
So the court permanently enjoined the Attorney
General from requiring the Law Center to file its
Schedule B with its annual report. App.67a.
14
Back on appeal, the Ninth Circuit reiterated that
its precedent barred the Law Center’s facial challenge, then reversed the district court’s as-applied
ruling and ordered judgment for the Attorney
General. App.43a–44a. The court applied exacting
scrutiny, a flexible standard for election-related disclosures. App.8a. The court asked only whether the
Attorney General’s disclosure rule was substantially
related to a sufficiently important government interest. App.16a (citing Doe v. Reed, 561 U.S. 186, 196
(2010)). It declined to apply strict scrutiny or any form
of narrow-tailoring analysis, App.17a–18a, disregarded every trial-court fact finding, and substituted
its own against all the evidence, App.33a–43a.
The Ninth Circuit concluded that the Attorney
General’s blanket-disclosure rule bore a substantial
relation to the State’s interest in preventing charitable fraud. App.8a, 20a, 25a. It cast aside the
substantial evidence of threats and harassment and
raised the bar for an as-applied exception, requiring
the Law Center to prove that its donors would likely
face harassment solely for providing the Law Center
money, App.34a–35a n.6, and then only if harassment
was “a foregone conclusion,” App.37a.
The Ninth Circuit also said that the Law Center
was unable to show a reasonably probability of harassment because the Attorney General’s new system
would avert public disclosure. App.37a–41a. It held
that the district court clearly erred in finding otherwise, despite ample evidence of the Registry’s systematic incompetence and the Attorney General’s lack of
effort to thwart hacks, punish leaks, or stop
employees and contractors from wrongly accessing,
downloading, or printing Schedule Bs. App.39a–43a.
15
The Ninth Circuit denied rehearing en banc over a
five-judge dissent. App.107a–08a. Judge Ikuta, joined
by Judges Callahan, Bea, Bennett, and R. Nelson,
would have granted review to bring Ninth Circuit
precedent “in line with Supreme Court jurisprudence”
and a majority of other circuits. App.108a–10a, 115a–
16a. The dissenters would have applied strict scrutiny
as articulated in this Court’s NAACP v. Alabama line
of cases, not exacting scrutiny, which only applies to
disclosures in the electoral context. App.108a, 110a,
113a–15a, 122a, 125a–28a. And the dissenters would
not have overturned the district court’s factual
findings that (1) it was reasonably likely donors’
names would be publicly disclosed, and (2) donors
would face harassment as a result. App.122a–25a.
Freedom of association “is vital to a functioning
civil society,” and “[f]or groups with ‘dissident beliefs,’
it is fragile.” App.129a. Because the panel’s opinion
gave donors to advocacy organizations no meaningful
protection, the dissenters stated that review was
necessary to avoid eviscerating “First Amendment
protections long-established by the Supreme Court.”
App.127a. That was particularly true because the
panel imposed “a next-to-impossible evidentiary
burden on plaintiffs seeking protection of their
associational rights.” App.128a. Accordingly, the
dissenters would have granted en banc review “to
reaffirm the vitality of NAACP v. Alabama’s
protective doctrine, and to clarify that Buckley’s
watered-down standard has no place outside of the
electoral context.” App.128a.
16
REASONS FOR GRANTING THE WRIT
Privacy of association is a fundamental right. It is
presumed that citizens’ beliefs and affiliations are
generally no concern of the state. Overcoming this
presumption should not be easy because officials may
use such information to penalize views they dislike.
And to say there is a blanket compelling interest in
donor disclosure flips the First Amendment on its
head, establishing a default rule of disclosure rather
than one of confidentiality
That is why, since NAACP v. Alabama, this Court
has subjected compelled disclosures that seriously
burden freedom of association—outside the electoral
context—to strict scrutiny. Yet in direct conflict with
this Court and the First, Fourth, Fifth, Sixth, Tenth,
and D.C. Circuits, the Second and Ninth Circuits
apply Buckley v. Valeo’s exacting-scrutiny standard to
non-election-related mandates requiring charities to
annually disclose their major donors.
Only this Court can resolve these conflicts and
protect the associational rights that ensure organizations and individuals can engage in public advocacy
without fear. It should do so now because recent
events have reiterated the importance of protecting
donor confidentiality, and because the Attorney
General’s blanket-disclosure rule is prophylactic,
imprecise, unduly burdensome, and facially violates
the First Amendment. Enforcing that rule against the
Law Center is also unconstitutional as applied
because the Center proved that its employees, donors,
and clients face intimidation, death threats, assassination attempts, hate mail, boycotts, and vitriol by
ideological opponents. Review is warranted.
17
I.
The Ninth Circuit’s ruling conflicts with this
Court’s precedent, which applies strict
scrutiny to disclosure and related mandates
outside the electoral context.
NAACP v. Alabama has safeguarded freedom of
association for 60 years. The Ninth Circuit has
rejected that teaching and “eviscerate[d] the First
Amendment protections long-established by” this
Court. App.127a.
A. Freedom of association protects charities
against government attempts to unmask
their anonymous donors.
The First and Fourteenth Amendments protect
charities’ freedom to associate with donors to
advocate shared ideals. Kusper v. Pontikes, 414 U.S.
51, 56-7 (1973). Privacy of association is a central
aspect of that right. Gibson v. Fla. Legislative
Investigation Comm., 372 U.S. 539, 544 (1963). This
Court has recognized that advocacy groups like the
Law Center have a “strong associational interest in
maintaining the privacy of membership lists,” id. at
555, and also that members and donors are treated
“interchangeably,” Buckley, 424 U.S. at 66. Donors
and members are equivalent because liking the
message they hear and desiring to amplify it is why
supporters contribute. FEC v. Nat’l Conservative
Political Action Comm., 470 U.S. 480, 495 (1985).
The Law Center—like hundreds of nonprofits
across the political spectrum—has a powerful interest
in protecting its donors’ privacy. Repeatedly, this
Court has “held laws unconstitutional that require
disclosure of membership lists for groups seeking
18
anonymity” outside the electoral context, Rumsfeld v.
Forum for Academic & Institutional Rights, Inc., 547
U.S. 47, 69 (2006), because the First Amendment’s
premise is distrust of government power. Citizens
United v. FEC, 558 U.S. 310, 340 (2010). Generally
speaking, a citizen’s beliefs, speech, and associations
“are no concern of government.” Gibson, 372 U.S. at
570 (Douglas, J., concurring). But disclosure rules
allow officials and persons who accidentally or
maliciously gain access to donors’ identities to expose
and penalize their views—serious ills that freedom of
association prevents. Boy Scouts of Am. v. Dale, 530
U.S. 640, 647-48 (2000).
That charitable donations involve money does not
lower the First Amendment stakes. This Court has
long safeguarded nonprofit solicitations as speech.
Riley v. Nat’l Fed’n of the Blind of N.C., Inc., 487 U.S.
781, 789 (1988). And rightly so, because nonprofits’
requests for money are typically combined with information, advocacy, and discussion that is fully First
Amendment protected. Sec’y of State of Md. v. Joseph
H. Munson Co., 467 U.S. 947, 961 (1984). Without
donations, that speech will cease. Vill. of Schaumburg
v. Citizens for a Better Env’t, 444 U.S. 620, 632 (1980).
So this Court has safeguarded charities’ ability to
solicit donations. Ibid.; Riley, 487 U.S. at 801 n.13.
The First Amendment protects charities’ right not
just to associate but to do so effectively. Kusper, 414
U.S. at 58. And frontal attacks that bar or penalize
affiliation are not the only state actions that implicate
that right. Bates v. City of Little Rock, 361 U.S. 516,
523 (1960). “[R]egulatory measures . . . cannot be
employed in purpose or in effect to stifle, penalize, or
curb the exercise of First Amendment rights.”
19
Louisiana ex rel. Gremillion v. NAACP, 366 U.S. 293,
297 (1961). Here, the Attorney General’s disclosure
rule implicates the Law Center’s freedom of association because it has the “practical effect of discouraging” donors from giving to advance its advocacy.
NAACP v. Alabama, 357 U.S. at 461 (cleaned up).
Forcing nonprofits to disclose supporters’ names
and addresses as a matter of course is a serious
impediment to these freedoms. Because donations
expose backers’ most deeply held values and beliefs.
Buckley, 424 U.S. at 66, financial support has
“powerful political and civic consequences.” Knox v.
Serv. Emps. Int’l Union, 567 U.S. 298, 310 (2012).
Donors today—as in the Civil Rights Era—regularly
face harassment, threats of bodily harm, loss of
employment, and economic retaliation. Citizens
United, 558 U.S. at 482-83, 485 (Thomas, J.,
concurring in part and dissenting in part); NAACP v.
Alabama, 357 U.S. at 462. Such hostility discourages
new and existing donors alike. Bates, 361 U.S. at 524.
Because our society has never been more vehemently
polarized, fear of reprisal threatens to dry up funds to
the point that some viewpoints cannot survive.
Buckley, 424 U.S. at 71.
Given today’s incendiary social conditions, donors
rightly fear the Attorney General’s blanket-disclosure
rule. It is too easy for anyone with a computer to
access Schedule B data from the Registry and use it
to find and compile information about donors and
their families, including contact information, homes,
vehicles, and jobs. John Doe No. 1 v. Reed, 561 U.S.
186, 208 (2010) (Alito, J., concurring). The potential
for harassment, threats, and physical attacks is limitless. Ibid. As just one example, opponents of
20
California’s Proposition 8 compiled lists of donors and
created websites dedicated to those donors’ personal
destruction. Citizens United, 558 U.S. at 481
(Thomas, J., concurring and dissenting in part).
Supporters faced death threats, property damage,
and lost employment. Id. at 481-85.
These costs illustrate “the vital relationship
between freedom to associate and privacy in one’s
associations.” NAACP v. Alabama, 357 U.S. at 462.
Donors’ desire for anonymity stems from rational
fears of retaliation, social ostracization, and economic
ruin. McIntyre v. Ohio Elections Comm’n, 514 U.S.
334, 341-42 (1995). Donating anonymously—like
speaking anonymously—is “an honorable tradition of
advocacy,” “a shield from the tyranny of the majority”
that protects donors “from retaliation—and their
ideas from suppression—at the hand of an intolerant
society.” Id. at 357.
Access to Schedule Bs by any government agency
other than the IRS threatens to rob donors of privacy
and the Law Center of means to advocate its and its
donors’ views. Thus, the Attorney General’s disclosure regime poses severe First Amendment harms.
When the government burdens free speech and
association rights, it must prove that burden is
justified. McCutcheon v. FEC, 572 U.S. 185, 210
(2014). Instead, the Ninth Circuit relieved the
Attorney General of that burden and engaged in
“appellate factfinding,” “holding against all evidence
that the donors’ names would not be made public and
that the donors would not be harassed.” App.109a
(Ikuta, J., dissenting). And it did so even though such
broad prophylactic rules are inherently suspect under
the First Amendment. Riley, 487 U.S. at 801.
21
B. This Court applies strict scrutiny to
disclosure rules—like the Attorney
General’s—that burden freedom of
association outside the electoral context.
As NAACP v. Alabama and its progeny make
clear, strict scrutiny applies to disclosure rules that
seriously burden free association outside the electoral
context. Strict scrutiny requires the government to
show that its actions “are narrowly tailored to serve
compelling state interests.” Reed v. Town of Gilbert,
135 S. Ct. 2218, 2226 (2015).
During the Civil Rights Era, states devised all
manner of ploys to obtain NAACP member lists.
Exposing this affiliation often resulted in members
facing “economic reprisal, loss of employment, threat
of physical coercion, and other manifestations of
public hostility.” NAACP v. Alabama, 357 U.S. at 462.
Recognizing this, the Court established a stringent
standard for reviewing state efforts to compel
nonprofits to divulge their supporters.
NAACP v. Alabama held that the government’s
interest in enforcing disclosure rules that deter free
association “must be compelling.” 357 U.S. at 463
(cleaned up). Two years later, this Court reiterated
that government may only justify a disclosure
requirement that significantly interferes with
freedom of association by “showing a subordinating
interest which is compelling.” Bates, 361 U.S. at 524.
Government may not force citizens to reveal their
private affiliations based on anything less than a goal
“of overriding and compelling state interest.” Gibson,
372 U.S. at 546. Accord id. at 555 (requiring a
“compelling and subordinating state interest”).
22
No daylight exists between the NAACP v.
Alabama line of cases and the compelling-interest test
this Court traditionally uses to evaluate other
burdens on freedom of association. E.g., Knox, 567
U.S. at 314 (“mandatory associations are permissible
only when they serve a compelling state interest”)
(cleaned up); Dale, 530 U.S. at 648 (freedom of
association may only be “overridden by regulations
adopted to serve compelling state interests”) (cleaned
up); Roberts v. U.S. Jaycees, 468 U.S. 609, 623 (1984)
(same). This Court consistently requires that the
government prove that non-election-related associational burdens serve a compelling interest.
This Court has also established that disclosure
rules “must be highly selective” or “narrowly drawn”
to survive First Amendment challenge. Gremillion,
366 U.S. at 296-97 (cleaned up). The Court has
expressed that principle in different ways, such as
requiring “a crucial relation” to the government’s
interest, or that the measure be “essential to
fulfillment of” the government’s purpose. Gibson, 372
U.S. at 549. Regardless, the gist has always been the
same: the state may not pursue even its legitimate
interests “‘by means that broadly stifle fundamental
personal liberties when the end can be more narrowly
achieved.’” NAACP v. Alabama, 377 U.S. 288, 307-08
(1964) (quoting Shelton v. Tucker, 364 U.S. 479, 488
(1960)).
Outside the disclosure context, this Court’s freeassociation cases incorporate a similar rule. Laws
that burden freedom of association “must not be
significantly broader than necessary to serve” the
government’s interest. Knox, 567 U.S. at 314. Accord
Roberts, 468 U.S. at 623 (government action is not
23
sufficiently tailored if the same goal could be achieved
“through means significantly less restrictive of
associational freedoms”). “Precision of regulation
must be the touchstone in an area so closely touching
our most precious freedoms.” NAACP v. Button, 371
U.S. 415, 438 (1963).
The only standard in this Court’s lexicon that
incorporates both a compelling interest and a narrow
tailoring requirement is strict scrutiny. Accordingly,
strict scrutiny is the default rule for disclosure
mandates that burden free-association rights. This
includes the Attorney General’s extraordinary
blanket requirement here that charities disclose their
major donors’ names and addresses in annual
Registry filings.
C. This Court designed “exacting” scrutiny
for disclosures related to elections and
has never applied that lower standard
outside the electoral context.
Buckley v. Valeo devised “exacting” scrutiny to
evaluate disclosure rules imposed by the Federal
Election Campaign Act. Those rules were calculated
to inform voters regarding who gave money to
political campaigns and how that money was spent.
424 U.S. at 66. Because such disclosures play a
unique role in helping citizens evaluate political
candidates and keeping elections fair and honest, this
Court decided that a more flexible standard of review
should apply. E.g., id. at 66 (noting the Act’s
disclosure rules concern “the free functioning of our
national institutions”) (cleaned up).
24
Buckley’s “substantial governmental interests”
standard, id. at 68, is a hallmark of intermediate—
not strict—scrutiny. E.g., Turner Broad. Sys., Inc. v.
FCC, 520 U.S. 180, 186 (1997). In keeping with that
reduced standard, exacting scrutiny requires only “a
relevant correlation or substantial relation between
the governmental interest and the information
required to be disclosed.” Buckley, 424 U.S. at 64
(cleaned up). No separate tailoring analysis applies
because election-related disclosure rules are
generally “the least restrictive means of curbing the
evils of campaign ignorance and corruption that
Congress found to exist.” Id. at 68.
No equivalency exists between the tests in NAACP
v. Alabama and Buckley. In fact, Buckley explicitly
distinguished NAACP: “We agree with the Court of
Appeals’ conclusion that NAACP v. Alabama is
inapposite where, as here, any serious infringement
on First Amendment rights brought about by the
compelled disclosure of contributors is highly
speculative.” 424 U.S. at 69-70. All Buckley allows in
the electoral context is an as-applied exemption once
a party demonstrates the “reasonable probability that
the compelled disclosure of [its] contributors’ names
will subject them to threats, harassment, or reprisals
from either Government officials or private parties.”
Id. at 74. Accord Brown v. Socialist Workers ’74
Campaign Comm., 459 U.S. 87, 98 (1982) (describing
“the test announced in Buckley for safeguarding the
First Amendment interests of minor [political] parties
and their members and supporters”).
This Court has applied Buckley’s test numerous
times and adopted a customary formulation: significant encroachments on free association must have “a
25
relevant correlation or substantial relation between
the governmental interest and the information
required to be disclosed, and the governmental
interest must survive exacting scrutiny,” which
means “the strength of the governmental interest
must reflect the seriousness of the actual burden on
First Amendment rights.” Davis v. FEC, 554 U.S. 724,
744 (2008) (cleaned up). Accord Citizens United, 558
U.S. at 366.
But this Court has never applied exacting scrutiny
to non-election-related disclosures. To the contrary,
this Court places Buckley at the heart of “a series of
precedents considering First Amendment challenges
to disclosure requirements in the electoral context”
that apply “exacting scrutiny.” John Doe No. 1, 561
U.S. at 196 (emphasis added). That is because the
First Amendment grants states “significant flexibility
in implementing their own voting systems.” Id. at
195.
In sum, exacting scrutiny is only for the electoral
context, based on concerns unique to elections, and
has no application outside “campaign-related
activities.” Citizens United, 558 U.S. at 366 (quoting
Buckley, 424 U.S. at 64). Thus, this Court assuaged
political donors’ concerns about anonymity—and
exacting scrutiny’s lack of rigor—by noting they could
instead “contribute unlimited amounts to 501(c)
organizations, which are not required to publicly
disclose their donors.” McCutcheon, 572 U.S. at 224.
No such donor alternative is available under the
Attorney General’s disclosure rule and after the
Ninth Circuit’s ruling here.
26
D. The Ninth Circuit’s contrary
jeopardizes association rights.
ruling
The Attorney General’s blanket-disclosure rule
bears no relation to elections. Yet the Ninth Circuit
(1) cited several electoral-disclosure cases, (2) used
exacting scrutiny, and (3) refused to “apply the kind
of ‘narrow tailoring’ traditionally required in the
context of strict scrutiny” to the Law Center’s claims.
App.16a–17a, 43–44a. As the panel majority saw it,
“there is only a single test—exacting scrutiny—that
applies both within and without the electoral
context.” App.133a–34a.
This Court’s immediate intervention is crucial to
prevent the Ninth Circuit from wiping out vital rights
that the First Amendment protects. The Ninth
Circuit treats any disclosure rule—instigated by any
agency in the State’s vast bureaucratic network—as
equivalent to statutes designed to ensure free and fair
elections. That lax analysis infects every facet of the
Ninth Circuit’s decision, fails to take freedom of
association seriously, and “is contrary to the
reasoning and spirit of decades of [this Court’s]
jurisprudence. App.128a (Ikuta, J., dissenting). Left
unchecked, the ruling could spread to other circuits,
giving ideological opponents a powerful weapon to
shut down speech using intimidation and threats.
Recent events amplify the chilling effects of these
threats on free expression and association.
If the First Amendment is to provide meaningful
protection, a compelling interest must be more than
the government’s speculative assertion that it might
be able to use material that a federal court has already found the government did not need in the past.
27
1. Under strict scrutiny, the Attorney
General’s blanket-disclosure rule is
facially unconstitutional.
Facial challenges to disclosure rules are an
established part of this Court’s jurisprudence. “[T]he
threat to the exercise of First Amendment rights [may
be] so serious and the state interest furthered by
disclosure so insubstantial that [such] requirements
cannot be constitutionally applied.” Buckley, 424 U.S.
at 71. This warning applies equally to the Attorney
General’s blanket-disclosure rule, which is a nuclear
threat to freedom of association with little-to-no
benefit to the State.
The Attorney General requires all charities that
fundraise in California to disclose major donor names
and addresses even though (1) there is no reason to
suspect thousands of nonprofits of wrongdoing; (2) the
IRS and often charities’ home states already police
their activities; (3) the Attorney General virtually
never uses donors’ information in enforcement
actions; (4) donor information never opens or closes
one of the Attorney General’s fraud investigations;
and (5) even when donor information is beneficial, the
Attorney General can obtain it in far more targeted
ways. That is why the district court found that out of
540 investigations over 10 years, the Attorney
General’s Office had only used Schedule B
information in five cases, and even then could have
obtained the same data in other ways. App.55a.
By “lump[ing] [legitimate charities] with those
[rationally suspected of] using the charitable label as
a cloak for profitmaking and refus[ing] to employ
more precise measures to separate one kind from the
28
other,” Vill. of Schaumburg, 444 U.S. at 637, the
Attorney General treats thousands of charities as
suspected criminals. Such indiscriminate treatment
severely hampers freedom of association and fails to
“employ means narrowly tailored to serve a
compelling governmental interest.” Joseph H.
Munson Co., 467 U.S. at 965 n.13. By going “far
beyond what might be justified in the exercise of the
State’s legitimate inquiry” into charities’ operations,
Shelton, 364 U.S. at 490, the Attorney General’s
disclosure mandate “on its face and therefore in all its
applications falls short of constitutional demands.”
Joseph H. Munson Co., 467 U.S. at 965 n.13. Because
the Attorney General’s disclosure rule is facially
unconstitutional, forcing charities to bring “case-bycase ‘as applied’ challenges” is superfluous and a
waste of judicial resources. Ibid.
The Ninth Circuit reached the opposite conclusion
only by pointing to another Ninth Circuit ruling that
applied “exacting scrutiny” and by holding that the
Attorney General’s disclosure mandate did not fail
that standard “in a substantial number of cases,
judged in relation to [its] plainly legitimate sweep.”
App.43a–44a (citing Ctr. for Competitive Politics, 784
F.3d at 1315 (9th Cir. 2015)). But because exacting
scrutiny does not apply outside the electoral context,
the Ninth Circuit’s facial analysis was wrong from the
start.
The Ninth Circuit should have asked whether the
Attorney General’s blanket-disclosure regulation fails
strict scrutiny in a substantial number of cases judged
in relation to the mandate’s legitimate sweep. The
answer is “yes” because the disclosure regulation does
nothing to prevent fraud. Joseph H. Munson Co., 467
29
U.S. at 967. Requiring hundreds of charities to
disclose donors’ names and addresses annually to a
Registry with a proven history of leaking confidential
information will have a devastating impact on
support. In contrast, the Attorney General does not
need donors’ confidential information, hardly ever
uses it, and can readily obtain that data via an audit
or subpoena on a reasonable suspicion of fraud.
2. The Attorney General’s disclosure
mandate
is
unconstitutional
as
applied under any standard.
The Attorney General’s disclosure mandate is also
unconstitutional as applied to the Law Center, under
either strict or exacting scrutiny. Regarding strict
scrutiny, the Attorney General has never investigated
the Law Center for wrongdoing, and no complaints
have ever been filed against it. There is no basis for
forcing the Law Center to disclose donor information
annually. Any generalized interest in “protecting
charities and the public from fraud,” Riley, 487 U.S.
at 792 (cleaned up), has no force as applied to the Law
Center and is merely “substantial,” not compelling.
Ibid.
Nor is the Attorney General’s disclosure rule
narrowly tailored to serve any legitimate state
interest. It is a “prophylactic, imprecise, and unduly
burdensome” regulation that is unnecessary because
more narrowly tailored options of acquiring donor
information through audit or subpoena are readily
available. Id. at 800. Investigative efficiency is the
Attorney General’s sole basis for applying the
disclosure rule to the Law Center. But the State may
30
not “sacrifice speech for efficiency.” Id. at 795. And
“[b]road prophylactic rules in the area of freedom of
expression are suspect.” Button, 371 U.S. at 438. In
sum, the Attorney General’s disclosure regime falls
under strict scrutiny because it broadly stifles free
association when the State’s aims can be more
narrowly achieved. Gremillion, 366 U.S. at 296.
Under exacting scrutiny, the details may vary but
the result is the same. The Law Center merits an asapplied exemption to the Attorney General’s blanketdisclosure rule because it is likely the Law Center’s
donors would be revealed and such exposure would
subject them to threats, harassment, and reprisals.
Citizens United, 558 U.S. at 370. The Registry’s
website is so vulnerable to hacks, leaks, and inadvertent disclosures “that Schedule B information is
effectively available for the taking.” App.120a. Public
release of donor information is predictable.
For those associated with the Law Center, harassment, threats, and reprisals are not hypothetical.
Opponents have wrongly labeled the Law Center a
“hate group” and “Islamophobic.” Employees face
vulgar, hateful, and harassing phone calls and emails,
and
occasional
pornographic
correspondence.
Appellee Br. 7–8.
Law Center clients like Pamela Geller—who used
her blog to criticize a lawyer who represented the
parents of a teenage girl who fled her home in fear of
her life after converting from Islam to Christianity—
frequently receive death threats. ISIS instructed its
followers to kill Geller and labeled those like the Law
Center who enable her speech “legitimate targets.” Id.
31
at 10. Three ISIS followers conspired to assassinate
Geller; she lives under constant guard. Id. at 9–10.
Law Center client Sally Kern, at the time a
Kansas legislator, came under fire for expressing her
Christian beliefs about marriage. She received a
death threat and was shadowed by law enforcement
for two weeks. Id. at 11.
Melissa Wood, another client, objected to a school
forcing her teenage daughter to profess and write out
the Shahada, the Muslim profession of faith. Wood
received an online message from someone claiming to
attend her daughter’s school who threatened to stab
her daughter’s stomach, insert a hook, and hang her
child from a tree. Ibid.
The Law Center’s co-founder and first donor,
Thomas Monaghan, was publicly branded, wrongly,
as one of the “most antigay persons in the country”
likely due to his Law Center support, and he then saw
his business subjected to a national boycott based on
his prolife views. Id. at 8.
And no doubt exists that such threats have caused
donor concern. One contributor even anonymously
mailed cash rather than leave a donor record and
become a terrorist target. Id. at 9. Courts need not
wait until a charity’s donor base has been decimated.
Despite this evidence, the Ninth Circuit rejected
the Law Center’s as-applied challenge under exacting
scrutiny. This result speaks volumes about the impossible bar the court set for as-applied claims and its
“appellate factfinding.” App.109–10a, 128a. (Ikuta, J.,
dissenting). One thing is clear: if the Law Center does
32
not qualify for an as-applied exemption to the Attorney General’s blanket-disclosure rule, no one will.
And that appears to be what the Ninth Circuit intended. App34a–35a n.6, 36a–37a & n.7, 85a–87a & n.4.
II. The Ninth Circuit’s decision intensifies a
mature, 6-2 circuit split.
The Ninth Circuit’s ruling intensified a circuit
conflict involving eight Courts of Appeals. The Second
and Ninth Circuits apply exacting scrutiny to
disclosure mandates outside the electoral context.
But the First, Fourth, Fifth, Sixth, Tenth, and D.C.
Circuits apply strict scrutiny to non-election,
compelled disclosures. App.115a–16a & n.1 (outlining
this conflict). Only this Court may resolve which
standard is correct and whether the First Amendment provides charities meaningful protection.
Previously, the Courts of Appeals substantially
agreed that exacting scrutiny applied only to electionrelated disclosures. App.115a. State donor-disclosure
rules then led the Second and Ninth Circuits to forge
a new path. App.117a–18a. Both have held that
exacting scrutiny under Buckley applies to disclosure
requirements no matter their context. Citizens United
v. Schneiderman, 882 F.3d 374, 382 (2d Cir. 2018)
(applying exacting scrutiny to all disclosure
requirements because they are “not inherently
content-based nor do they inherently discriminate
among speakers”); App.133a–34a (“[T]here is only a
single test—exacting scrutiny—that applies both
within and without the electoral context.”). But see
Schneiderman, 882 F.3d at 384 (distinguishing
Americans for Prosperity Foundation based on the
33
Attorney General’s “systematic incompetence in
keeping donor lists confidential of such a magnitude
as to effectively amount to publication”).
Most circuits view the issue differently. Outside
the electoral context, they scrutinize disclosure
mandates under a test that bears all the hallmarks of
strict scrutiny, following NAACP v. Alabama and its
progeny. The First Circuit, for example, approved a
Nuclear Regulatory Commission subpoena that
burdened a watchdog’s free association with
informants only because “the government ha[d]
adequately shown both a compelling interest in
obtaining the material sought and that no significantly less restrictive alternatives exist.” United
States v. Comley, 890 F.2d 539, 545 (1st Cir. 1989).
Although the Fourth Circuit cited a hodgepodge of
standards in deciding whether the Department of
Labor could require a trade association to disclose any
agreement with members to engage in anti-union
“persuader activity,” Master Printers of Am. v. Donovan, 751 F.2d 700, 704-06 (4th Cir. 1984), its decision
turned on whether “the disclosure and reporting requirements [were] justified by a compelling government interest, and [whether] the legislation [was]
narrowly tailored to serve that interest,” id. at 705.
The Fifth Circuit similarly cited “exacting
scrutiny” in weighing whether a Texas judge could
demand and publicize a Mexican-American association’s officers and members list because it was organizing a school boycott. Familias Unidas v. Briscoe, 619
F.2d 391, 399 (5th Cir. 1980). Yet the court barred the
disclosure even though it served “a legitimate and
compelling state purpose,” because the state court’s
34
order “swe[pt] too broadly,” id. at 399-400, and was
not “drawn with sufficiently narrow specificity to
avoid impinging more broadly upon First Amendment
liberties than [was] absolutely necessary,” id. at 399.
The Sixth Circuit quoted much of the Fourth
Circuit’s analysis in determining whether the
Department of Labor could force a law firm to disclose
any anti-union “persuader activity” it undertook for
an employer. Humphreys, Hutcheson & Moseley v.
Donovan, 755 F.2d 1211, 1220-22 (6th Cir. 1985). It
likewise held that the disclosure served “the
government’s compelling interest in maintaining
antiseptic conditions in the labor relations field” and
was “carefully tailored so that [F]irst [A]mendment
freedoms are not needlessly curtailed.” Id. at 1222.
Though ruling for the government, the Tenth
Circuit also applied strict scrutiny when an anti-tax
organization argued that IRS collaboration with an
employee-informant violated its free-association
rights. Pleasant v. Lovell, 876 F.2d 787, 789-93 (10th
Cir. 1989). The court held that “some interference
may be permissible [only] when the government can
demonstrate a compelling interest, such as good-faith
criminal investigation[,] that is narrowly tailored to
detect information concerning tax evasion.” Id. at
804-05.
Also applying strict scrutiny, the D.C. Circuit held
that the government could not launch a full FBI
investigation on a book-shelving employee simply
because he associated with the Young Socialist
Alliance. It found no “legitimate, much less
compelling justification” for such an inquiry, Clark v.
Library of Congress, 750 F.2d 89, 99 (D.C. Cir. 1984),
35
nor had the government “tailor[ed] its investigation
so that it [was] the least restrictive means of
achieving” its interests, id. at 98.
In sum, the Attorney General’s blanket-disclosure
rule would fall in six circuits because it does not serve
a compelling interest and is not narrowly tailored. Yet
it survives in the Second and Ninth Circuits because
those courts always examine disclosure rules under
exacting scrutiny. Given the current cultural climate,
such a low standard fosters more polarization and
open hostility, inducing fear by donors who want to
participate in the public debate.
III. This case is an ideal vehicle to resolve a
circuit conflict that has severe ramifications
for charities nationwide.
The circuit conflict is deep and mature, and its
resolution cannot wait. First, the Ninth Circuit’s
ruling impacts thousands of charities who fundraise
in California, the nation’s most populous state. And
once major donor information is publicly leaked, it is
impossible to undo the damage. This Court’s decisive
action is needed immediately to protect charities and
donors across the political spectrum and throughout
the United States.
36
Second, this case is a clean vehicle for the Court to
resolve whether strict or exacting scrutiny applies to
forced disclosure outside the electoral context. There
are no disputed material facts—indeed, the Court has
the benefit of findings based on a full trial—and the
question presented controls the outcome.1 Moreover,
the Law Center’s evidence of death threats, harassing
phone calls, a boycott, hate mail, and even a
conspiracy to kill a client places beyond doubt the
merits of the Law Center’s claims.
Third, First Amendment rights should not depend
on where a charity solicits funds. Yet freedom of
association currently means little for citizens
considering donating to an organization that solicits
in California. This Court has traditionally placed
great faith in as-applied challenges to uphold freeassociation rights. But if four years of litigation and
the Ninth Circuit’s “next-to-impossible evidentiary”
standard prove anything, App.128a, it is that this
approach has not worked. John Doe No. 1, 561 U.S. at
203 (Alito, J., concurring). The practical result here is
that citizens across the country are subject to having
their information disclosed and to being harassed by
those who disagree with them.
1 Regarding the Law Center’s as-applied claim, the Ninth Circuit
criticized the Law Center’s return preparers for listing anyone
who contributed $5,000 or more on its Schedule B filed with the
IRS, when the Law Center could have listed only those who gave
more than 2% of annual contributions. App.30a. But this honest
misunderstanding based on cryptic IRS regulations is
immaterial. Whereas the Law Center had every reason to believe
the IRS would protect its donor information from public
disclosure, the exact opposite is true of the Attorney General.
37
Fourth, the Attorney General’s office codified its
confidentiality policy and instituted its new system of
automated and personal reviews to identify documents incorrectly classified as public shortly before
the Law Center’s trial. Yet the district court still
found, after a full trial, that “[d]onors and potential
donors would be reasonably justified in a fear of
disclosure” under the new regime. App.63a. This
forecloses any argument that the Attorney General’s
new policy warrants fresh review in the district court.
Finally, in papering over this Court’s differing
standards for evaluating the constitutionality of
disclosure requirements in the election and nonelection contexts, the Ninth Circuit has made clear
that further percolation will not resolve the circuit
split or deviation from this Court’s jurisprudence.
Only this Court can clarify that the government
violates the First Amendment when it enables
harassment of donors for their views. As 58 amici
from across the political spectrum made clear in the
Ninth Circuit, public advocacy is for everyone, not
merely those able to weather abuse.
38
CONCLUSION
The petition for a writ of certiorari should be
granted.
Respectfully submitted,
KRISTEN K. WAGGONER
JOHN J. BURSCH
Counsel of Record
DAVID A. CORTMAN
RORY T. GRAY
ALLIANCE DEFENDING
FREEDOM
440 First Street, N.W.
Suite 600
Washington, D.C. 20001
(616) 450-4235
jbursch@ADFlegal.org
LOUIS H. CASTORIA
KAUFMAN DOLOWICH &
VOLUCK, LLP
425 California Street
Suite 2100
San Francisco, CA 94104
(415) 926-7600
AUGUST 2019
Counsel for Petitioner
APPENDIX
ia
APPENDIX TABLE OF CONTENTS
United States Court of Appeals for the Ninth
Circuit,
Opinion in 16-56855 and 16-56902
Issued September 11, 2018 ...................................... 1a
United States District Court for the Central
District of California,
Order for Judgment in Favor of Plaintiff
in 2:15-cv-03048
Issued November 16, 2016 ..................................... 51a
United States District Court for the Central
District of California
Order Denying Summary Judgment
in 2:15-cv-03048
Issued July 18, 2016 .............................................. 68a
United States District Court for the Central
District of California
Order Modifying Preliminary Injunction
in 2:15-cv-03048
Issued January 5, 2016 .......................................... 74a
United States Court of Appeals for the Ninth
Circuit
Opinion in 15-55911
Issued December 29, 2015 ..................................... 76a
United States District Court for the Central
District of California
Order Issuing Preliminary Injunction
in 2:15-cv-03048
Issued May 19, 2015 .............................................. 90a
iia
United States District Court for the Central
District of California
Order Granting Temporary Protective Order
in 2:15-cv-03048
Issued April 29, 2015 ............................................. 97a
United States Court of Appeals for the Ninth
Circuit,
Order Denying Petitions for Rehearing En Banc
in 16-56855 and 16-56902,
Issued March 29, 2019 ......................................... 104a
United States Court of Appeals for the Ninth
Circuit
Order Denying Petition for Panel Rehearing or
Rehearing En Banc in 15-55911
Issued April 6, 2016 ............................................. 146a
California Gov. Code § 12585 .............................. 148a
California Gov. Code § 12586 .............................. 149a
California Gov. Code § 12590 .............................. 150a
11 California Code of Regulations § 300 ............. 151a
11 California Code of Regulations § 301 ............. 152a
11 California Code of Regulations § 303 ............. 153a
11 California Code of Regulations § 305 ............. 154a
11 California Code of Regulations § 306 ............. 155a
11 California Code of Regulations § 310 ............. 156a
iiia
11 California Code of Regulations § 315 ............. 157a
11 California Code of Regulations § 316 ............. 157a
26 U.S.C. 6104 ...................................................... 158a
26 U.S.C. 7213 ...................................................... 159a
26 U.S.C. 7213A ................................................... 160a
26 C.F.R. § 1.6033-2 ............................................. 161a
Letter from California to Thomas More dated
March 6, 2012 ....................................................... 163a
Letter from Thomas More to California dated
March 14, 2012 ..................................................... 165a
Letter from Thomas More Counsel to California
dated April 11, 2012 ............................................. 167a
Letter from California to Thomas More dated
April 19, 2013 ....................................................... 169a
Letter from Thomas More to California dated
April 24, 2013 ....................................................... 171a
Letter from California to Thomas More dated
October 22, 2013................................................... 173a
Letter from Thomas More to California dated
October 28, 2013................................................... 175a
Letter from California to Thomas More dated
April 23, 2014 ....................................................... 177a
iva
Letter from California to Thomas More dated
October 31, 2014................................................... 179a
Letter from California to Thomas More dated
March 24, 2015 ..................................................... 181a
Letter from Thomas More Counsel to California
dated April 7, 2015 ............................................... 184a
1a
FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
AMERICANS FOR
PROSPERITY
FOUNDATION,
Plaintiff-Appellee,
v.
No. 16-55727
D.C. No.
2:14-cv-09448-RFFM
XAVIER BECERRA, in
his Official Capacity as
Attorney General of
California,
Defendant-Appellant.
AMERICANS FOR
PROSPERITY
FOUNDATION,
Plaintiff-Appellant,
v.
XAVIER BECERRA, in
his Official Capacity as
Attorney General of
California,
Defendant-Appellee.
No. 16-55786
D.C. No.
2:14-cv-09448-RFFM
2a
THOMAS MORE LAW
CENTER,
Plaintiff-Appellee,
v.
No. 16-56855
D.C. No.
2:15-cv-03048-RFFM
XAVIER BECERRA, in
his Official Capacity as
Attorney General of the
State of California,
Defendant-Appellant.
THOMAS MORE LAW
CENTER,
Plaintiff-Appellant,
v.
XAVIER BECERRA, in
his Official Capacity as
Attorney General of the
State of California,
No. 16-56902
D.C. No.
2:15-cv-03048-RFFM
OPINION
Defendant-Appellee.
Appeal from the United States District Court for the
Central District of California
Manuel L. Real, District Judge, Presiding
Argued and Submitted June 25, 2018
Pasadena, California
Filed September 11, 2018
Before: Raymond C. Fisher, Richard A. Paez
3a
and Jacqueline H. Nguyen, Circuit Judges.
Opinion by Judge Fisher
SUMMARY*
Civil Rights
The panel vacated the district court’s
permanent injunctions, reversed the bench trial
judgments, and remanded for entry of judgment in
favor of the California Attorney General in two cases
challenging California’s charitable registration
requirement as applied to two non-profit
organizations that solicit tax-deductible contributions
in the state.
Plaintiffs qualify as tax-exempt charitable
organizations under § 501(c)(3) of the Internal
Revenue Code, 26 U.S.C. § 501(c)(3). They challenge
the Attorney General of California’s collection of
Internal Revenue Service Form 990 Schedule B,
which contains the names and addresses of their
relatively few largest contributors. Plaintiffs argue
the state’s disclosure requirement impermissibly
burdens their First Amendment right to free
association.
* This summary constitutes no part of the opinion of the court.
It has been prepared by court staff for the convenience of the
reader.
4a
The panel held that the California Attorney
General’s Schedule B requirement, which obligates
charities to submit the very information they already
file each year with the IRS, survived exacting scrutiny
as applied to the plaintiffs because it was
substantially related to an important state interest in
policing charitable fraud. The panel held that
plaintiffs had not shown a significant First
Amendment burden on the theory that complying
with the Attorney General’s Schedule B nonpublic
disclosure requirement would chill contributions. The
panel further concluded that even assuming arguendo
that the plaintiffs’ contributors would face
substantial harassment if Schedule B information
became public, the strength of the state’s interest in
collecting Schedule B information reflected the actual
burden on First Amendment rights because the
information was collected solely for nonpublic use,
and the risk of inadvertent public disclosure was
slight.
COUNSEL
Alexandra Robert Gordon (argued), Jose A. ZelidonZepeda, Kevin A. Calia, and Emmanuelle S. Soichet,
Deputy Attorneys General; Tamar Pachter,
Supervising Deputy Attorney General; Douglas J.
Woods, Senior Assistant Attorney General; Xavier
Becerra, Attorney General; Office of the Attorney
General, San Francisco, California; for DefendantAppellant/Cross-Appellee.
Derek Shaffer (argued), William A. Burck, Eric C.
Lyttle, Keith H. Forst, and Jonathan G. Cooper,
5a
Quinn Emanuel Urquhart & Sullivan LLP,
Washington, D.C.; Harold Barza, Quinn Emanuel
Urquhart & Sullivan, LLP, Los Angeles, California;
for Plaintiff-Appellee/Cross-Appellant.
Tara Malloy, J. Gerald Hebert, and Megan P.
McAllen, Campaign Legal Center, Washington, D.C.,
for Amicus Curiae Campaign Legal Center.
Jeremy Talcott and Joshua P. Thompson, Pacific
Legal Foundation, Sacramento, California, for
Amicus Curiae Pacific Legal Foundation.
Marc Rotenberg, Alan Butler, James T. Graves, and
John Davisson, Electronic Privacy Information
Center, Washington, D.C., for Amicus Curiae
Electronic Privacy Information Center.
David Weiner and Robert Leider, Arnold & Porter
Kaye Scholer LLP, Washington, D.C., for Amicus
Curiae The Philanthropy Roundtable.
Keith Joseph Miller, Assistant Attorney General;
Dominic E. Draye, Solicitor General; Mark Brnovich,
Attorney General; Office of the Attorney General,
Phoenix, Arizona, for Amici Curiae States of Arizona,
Alabama, Louisiana, Michigan, Nevada, Texas, and
Wisconsin.
Mark Joseph Fitzgibbons, American Target
Advertising, Manassas, Virginia, for Amicus Curiae
American Target Advertising, Inc.
Allyson Newton Ho and John C. Sullivan, Gibson
Dunn & Crutcher LLP, Dallas, Texas; C. Dean
McGrath Jr., McGrath & Associates, Washington,
D.C.; for Amici Curiae Pacific Research Institute,
Cato Institute, and Competitive Enterprise Institute.
6a
Christopher H. McGrath and Samuel S. Sadeghi Paul
Hastings LLP, Costa Mesa, California; George W.
Abele, Paul Hastings LLP, Los Angeles, California;
Brett Harvey, Alliance Defending Freedom,
Scottsdale, Arizona; Nathaniel Bruno, Alliance
Defending Freedom, Washington, D.C.; for Amicus
Curiae Alliance Defending Freedom.
Brian Timothy Burgess, Goodwin Procter LLP,
Washington, D.C.; David J. Zimmer, Goodwin Procter
LLP, Boston, Massachusetts; for Amici Curiae
NAACP Legal Defense and Educational Fund, Inc.
Andrew P. Pugno, Law Offices of Andrew P. Pugno,
Fair Oaks, California, for Amicus Curiae Proposition
8 Legal Defense Fund.
Herbert W. Titus, Jeremiah L. Morgan, William J.
Olson, and Robert J. Olson, William J. Olson P.C.,
Vienna, Virginia; Joseph W. Miller, Ramona,
California; Michael Boos, Washington, D.C.; for Amici
Curiae Free Speech Defense and Education Fund,
Free Speech Coalition, Citizens United, Citizens
United Foundation, National Right to Work
Committee, U.S. Constitutional Rights Legal Defense
Fund, U.S. Justice Foundation, Family Research
Council,
Western
Center
for
Journalism,
Conservative Legal Defense and Education Fund, The
Leadership Institute, Public Advocate of the United
States, Downsize DC Foundation, Downsize. Org,
Gun Owners Foundation, Gun Owners of America, 60
Plus, 60 Plus Association, America’s Foundation for
Law and Liberty, America’s Liberty Committee,
Citizen Outreach Foundation, Citizen Outreach, LLC,
Law Enforcement Alliance of America, Liberty
Guard, Coalition for a Strong America, The Jesse
7a
Helms Center, Americans for Constitutional Liberty,
Catholicvote.org, Eberle Communications Group,
Inc., Clearword Communications Group, Davidson &
Co., and JFT Consulting.
OPINION
FISHER, Circuit Judge:
We address the constitutionality of a California
charitable registration requirement as applied to two
non-profit organizations that solicit tax-deductible
contributions in the state. Americans for Prosperity
Foundation (the Foundation) and Thomas More Law
Center (the Law Center) qualify as tax-exempt
charitable organizations under § 501(c)(3) of the
Internal Revenue Code, 26 U.S.C. § 501(c)(3). They
challenge the Attorney General of California’s
collection of Internal Revenue Service (IRS) Form 990
Schedule B, which contains the names and addresses
of their relatively few largest contributors. The
Attorney General uses the information solely to
prevent charitable fraud, and the information is not
to be made public except in very limited
circumstances. The plaintiffs argue the state’s
disclosure requirement impermissibly burdens their
First Amendment right to free association by
deterring individuals from making contributions.
The district court held that the Schedule B
requirement violates the First Amendment as applied
to the Foundation and Law Center and permanently
enjoined the Attorney General from demanding the
plaintiffs’ Schedule B forms. We have jurisdiction
8a
under 28 U.S.C. § 1291, and we vacate the
injunctions, reverse the judgments and remand for
entry of judgment in the Attorney General’s favor.
We hold that the California Attorney General’s
Schedule B requirement, which obligates charities to
submit the very information they already file each
year with the IRS, survives exacting scrutiny as
applied to the plaintiffs because it is substantially
related to an important state interest in policing
charitable fraud. Even assuming arguendo that the
plaintiffs’ contributors would face substantial
harassment if Schedule B information became public,
the strength of the state’s interest in collecting
Schedule B information reflects the actual burden on
First Amendment rights because the information is
collected solely for nonpublic use, and the risk of
inadvertent public disclosure is slight.
I.
A.
California’s Supervision of Trustees and
Charitable Trusts Act requires the Attorney General
to maintain a registry of charitable corporations (the
Registry) and authorizes him to obtain “whatever
information, copies of instruments, reports, and
records are needed for the establishment and
maintenance of the [Registry].” Cal. Gov’t Code §
12584. To solicit tax-deductible contributions from
California residents, an organization must maintain
membership in the Registry. See id. § 12585. Registry
information is open to public inspection, subject to
reasonable rules and regulations adopted by the
Attorney General. See id. § 12590.
9a
As one condition of Registry membership, the
Attorney General requires charities to submit a
complete copy of the IRS Form 990 they file with the
IRS, including attached schedules. See Cal. Code
Regs. tit. 11, § 301.1 One of these attachments,
Schedule B, requires 501(c)(3) organizations to report
the names and addresses of their largest contributors.
Generally, they must report “the names and
addresses of all persons who contributed . . . $5,000 or
more (in money or other property) during the taxable
year.” 26 C.F.R. § 1.6033-2(a)(2)(ii)(f). Special rules,
however, apply to organizations, such as the
Foundation and Law Center, meeting certain support
requirements. These organizations need only “provide
the name and address of a person who contributed
. . . in excess of 2 percent of the total contributions
. . . received by the organization during the year.” Id.
§ 1.6033-2(a)(2)(iii)(a). An organization with $10
million in receipts, for example, is required to disclose
only contributors providing at least $200,000 in
financial support. Here, for any year between 2010
and 2015, the Law Center was obligated to report no
more than seven contributors on its Schedule B, and
the Foundation was required to report no more than
1 In July 2018, the IRS announced it would no longer require
certain tax-exempt organizations, other than 501(c)(3)
organizations, to report the names and addresses of their
contributors on Schedule B. See Press Release, U.S. Dep’t of the
Treasury, Treasury Department and IRS Announce Significant
Reform to Protect Personal Donor Information to Certain TaxExempt Organizations (July 16, 2018), https://home.treasury.
gov/news/press-releases/sm426. Federal law, however, continues
to require 501(c)(3) organizations, such as the plaintiffs, to file
Schedule B information with the IRS.
10a
10 contributors – those contributing over $250,000 to
the Foundation.
The IRS and the California Attorney General
both make certain filings of tax-exempt organizations
publicly available but exclude Schedule B information
from public inspection. See 26 U.S.C. § 6104; Cal Gov’t
Code § 12590; Cal. Code Regs. tit. 11, § 310. At the
outset of this litigation, the Attorney General
maintained an informal policy treating Schedule B as
a confidential document not available for public
inspection on the Registry. See Americans for
Prosperity Found. v. Harris, 809 F.3d 536, 542 (9th
Cir. 2015) (AFPF I). In 2016, the Attorney General
codified that policy, adopting a regulation that makes
Schedule B information confidential and exempts it
from public inspection except in a judicial or
administrative proceeding or in response to a search
warrant. See Cal. Code Regs. tit. 11, § 310 (July 8,
2016). Under the new regulation:
Donor information exempt from public
inspection pursuant to Internal Revenue
Code section 6104(d)(3)(A) shall be
maintained as confidential by the
Attorney General and shall not be
disclosed except as follows:
(1) In a court or administrative
proceeding brought pursuant to the
Attorney General’s charitable trust
enforcement responsibilities; or
(2) In response to a search warrant.
Id. § 310(b). In accordance with this regulation, the
Attorney General keeps Schedule Bs in a separate file
11a
from other submissions to the Registry and excludes
them from public inspection on the Registry website.
B.
Thomas More Law Center is a legal
organization founded to “restore and defend
America’s
Judeo-Christian
heritage”
by
“represent[ing] people who promote Roman Catholic
values,” “marriage and family matters, freedom from
government interference in [religion]” and “opposition
to the imposition of Sharia law within the United
States.” Americans for Prosperity Foundation was
founded in 1987 as “Citizens for a Sound Economy
Educational Foundation,” with the mission of
“further[ing] free enterprise, free society-type issues.”
The Foundation hosts conferences, issues policy
papers and develops educational programs worldwide
to promote the benefits of a free market. It operates
alongside Americans for Prosperity, a 501(c)(4)
organization focused on direct issue advocacy.
Charities like the Foundation and the Law
Center are overseen by the Charitable Trusts Section
of the California Department of Justice, which houses
the Registry and a separate investigative and legal
enforcement unit (the Investigative Unit). The
Registry Unit processes annual registration renewals
and maintains both the public-facing website of
registered charities and the confidential database
used for enforcement. The Investigative Unit
analyzes complaints of unlawful charity activity and
conducts audits and investigations based on those
complaints.
Beginning in 2010, the Registry Unit ramped
up its efforts to enforce charities’ Schedule B
12a
obligations, sending thousands of deficiency letters to
charities that had not complied with the Schedule B
requirement. Since 2001, both the Law Center and
the Foundation had either filed redacted versions of
the Schedule B or not filed it with the Attorney
General at all. Each plaintiff had, however, annually
filed a complete Schedule B with the IRS. In 2012, the
Registry Unit informed the Law Center it was
deficient in submitting Schedule B information. In
2013, it informed the Foundation of the same
deficiency.
C.
In response to the Attorney General’s
demands, the Law Center and the Foundation
separately filed suit, alleging that the Schedule B
requirement unconstitutionally burdens their First
Amendment right to free association by deterring
individuals from financially supporting them. The
district court granted both plaintiffs’ motions for a
preliminary injunction, concluding they had raised
serious questions going to the merits of their cases
and demonstrated that the balance of hardships
tipped in their favor. See Americans for Prosperity
Found. v. Harris, No. 2:14-CV-09448-R-FFM, 2015
WL 769778 (C.D. Cal. Feb. 23, 2015). The Attorney
General appealed.
While those appeals were pending, we upheld
the Schedule B requirement against a facial
constitutional challenge brought by the Center for
Competitive Politics. See Ctr. for Competitive Politics
v. Harris, 784 F.3d 1307, 1317 (9th Cir. 2015).
Applying exacting scrutiny, we held both that the
Schedule B requirement furthers California’s
13a
compelling interest in enforcing its laws and that the
plaintiff had failed to show the requirement places an
actual burden on First Amendment rights. See id. at
1316–17. We left open the possibility, however, that a
future litigant might “show ‘a reasonable probability
that the compelled disclosure of its contributors’
names will subject them to threats, harassment, or
reprisals from either Government officials or private
parties’ that would warrant relief on an as-applied
challenge.” Id. at 1317 (alteration omitted) (quoting
Buckley v. Valeo, 424 U.S. 1, 74 (1976)).
The Law Center and the Foundation argue
they have made such a showing. In considering the
appeal from the preliminary injunction in their favor,
we disagreed. See AFPF I, 809 F.3d at 540. We held
that the plaintiffs had shown neither an actual
chilling effect on association nor a reasonable
probability of harassment at the hands of the state
from the Attorney General’s demand for nonpublic
disclosure of Schedule B forms. See id. The Law
Center and the Foundation had proffered some
evidence that private citizens might retaliate against
their contributors if Schedule B information became
public, but “[t]he plaintiffs’ allegations that technical
failures or cybersecurity breaches are likely to lead to
inadvertent public disclosure of their Schedule B
forms [were] too speculative to support issuance of an
injunction.” Id. at 541.
We nevertheless identified some risk that the
Attorney General could be compelled by § 12590 to
make Schedule B information available for public
inspection in the absence of a “rule[ ]” or “regulation[
],” Cal. Gov’t Code § 12590, formalizing the Attorney
General’s discretionary policy of maintaining
14a
Schedule B confidentiality. See AFPF I, 809 F.3d at
542. The Attorney General had proposed a regulation
to exempt Schedule B forms from the general
requirement to make Registry filings “open to public
inspection,” Cal. Gov’t Code § 12590, but the state had
not yet adopted the proposed regulation. We held that
a narrow injunction precluding public disclosure of
Schedule B information would address the risk of
public disclosure pending the Attorney General’s
adoption of the proposed regulation. We therefore
vacated the district court’s orders precluding the
Attorney General from collecting Schedule B
information from the plaintiffs and instructed the
court to enter new orders preliminarily enjoining the
Attorney General only from making Schedule B
information public. See AFPF I, 809 F.3d at 543.2
After presiding over a bench trial in each case,
the district court held the Schedule B requirement
unconstitutional as applied to the Foundation and the
Law Center. See Thomas More Law Ctr. v. Harris, No.
CV 15-3048-R, 2016 WL 6781090 (C.D. Cal. Nov. 16,
2016); Americans for Prosperity Found. v. Harris, 182
F. Supp. 3d 1049 (C.D. Cal. 2016). The district court
first rejected the plaintiffs’ facial challenges, holding
they were precluded by our opinion in Center for
Competitive Politics. It then held that the Attorney
General had failed to prove the Schedule B
requirement was substantially related to a
2 On remand, the district court also prohibited the Attorney
General from obtaining relevant discovery from the
Foundation’s contributors. This was one of several questionable
evidentiary rulings the court issued in the plaintiffs’ favor.
15a
sufficiently important governmental interest, as
necessary to withstand exacting scrutiny. The court
reasoned that the Attorney General had no need to
collect Schedule Bs, because he “has access to the
same information from other sources,” Thomas More
Law Ctr., 2016 WL 6781090, at *2, and had failed to
demonstrate the “necessity of Schedule B forms” in
investigating charity wrongdoing, Americans for
Prosperity Found., 182 F. Supp. 3d at 1053. The court
also concluded there was “ample evidence”
establishing the plaintiffs’ employees and supporters
face public hostility, intimidation, harassment and
threats “once their support for and affiliation with the
organization becomes publicly known.” Id. at 1055.
The court rejected the proposition that the Attorney
General’s informal confidentiality policy could
“effectively avoid inadvertent disclosure” of Schedule
B information, citing a “pervasive, recurring pattern
of uncontained Schedule B disclosures” by the
Registry Unit. Id. at 1057. Even after the Attorney
General codified the non-disclosure policy, the court
concluded that this risk of inadvertent public
disclosure remained. See Thomas More Law Ctr.,
2016 WL 6781090, at *5.
Having found for the plaintiffs on their First
Amendment freedom of association claims, the court
entered judgment for the plaintiffs and permanently
enjoined the Attorney General from enforcing the
Schedule B requirement against them. The Attorney
General appealed the judgments. The plaintiffs crossappealed, challenging the district court’s holding that
precedent foreclosed a facial attack on the Schedule B
requirement. The Law Center also cross-appealed the
district court’s adverse rulings on its Fourth
16a
Amendment and preemption claims, and the district
court’s failure to award it attorney’s fees.
II.
“In reviewing a judgment following a bench
trial, this court reviews the district court’s findings of
fact for clear error and its legal conclusions de novo.”
Dubner v. City & County of San Francisco, 266 F.3d
959, 964 (9th Cir. 2001). “[W]e will affirm a district
court’s factual finding unless that finding is illogical,
implausible, or without support in inferences that
may be drawn from the record.” United States v.
Hinkson, 585 F.3d 1247, 1263 (9th Cir. 2009) (en
banc) (footnote omitted).
III.
We address whether the Attorney General’s
Schedule B requirement violates the First
Amendment right to freedom of association as applied
to the plaintiffs. We apply “exacting scrutiny” to
disclosure requirements. See Doe v. Reed, 561 U.S.
186, 196 (2010). “That standard ‘requires a
substantial relation between the disclosure
requirement
and
a
sufficiently
important
governmental interest.’” Id. (quoting Citizens United
v. FEC, 558 U.S. 310, 366–67 (2010)). “To withstand
this scrutiny, ‘the strength of the governmental
interest must reflect the seriousness of the actual
burden on First Amendment rights.’” Id. (quoting
Davis v. FEC, 554 U.S. 724, 744 (2008)).
The plaintiffs contend “[t]he ‘substantial
relation’ element requires, among other things, that
the State employ means ‘narrowly drawn’ to avoid
needlessly stifling expressive association.” They cite
17a
Louisiana ex rel. Gremillion v. NAACP, 366 U.S. 293,
297 (1961) (“[W]hile public safety, peace, comfort, or
convenience can be safeguarded by regulating the
time and manner of solicitation, those regulations
need to be ‘narrowly drawn to prevent the supposed
evil.’” (citation omitted) (quoting Cantwell v.
Connecticut, 310 U.S. 296, 307 (1940))), Shelton v.
Tucker, 364 U.S. 479, 488 (1960) (“In a series of
decisions this Court has held that, even though the
governmental purpose be legitimate and substantial,
that purpose cannot be pursued by means that
broadly stifle fundamental personal liberties when
the end can be more narrowly achieved.”), and
McCutcheon v. FEC, 134 S. Ct. 1434, 1456–57 (2014)
(plurality opinion) (“Even when the Court is not
applying strict scrutiny, we still require ‘a fit that is
not necessarily perfect, but reasonable; that
represents not necessarily the single best disposition
but one whose scope is in proportion to the interest
served, . . . that employs not necessarily the least
restrictive means but . . . a means narrowly tailored
to achieve the desired objective.’” (alterations in
original) (quoting Board of Trustees of State Univ. of
N.Y. v. Fox, 492 U.S. 469, 480 (1989))). We are not
persuaded, however, that the standard the plaintiffs
advocate is distinguishable from the ordinary
“substantial relation” standard that both the
Supreme Court and this court have consistently
applied in disclosure cases such as Doe and Family
PAC v. McKenna, 685 F.3d 800, 805–06 (9th Cir.
2012). To the extent the plaintiffs ask us to apply the
kind of “narrow tailoring” traditionally required in
the context of strict scrutiny, or to require the state to
choose the least restrictive means of accomplishing its
18a
purposes, they are mistaken. See, e.g., Citizens United
v. Schneiderman, 882 F.3d 374, 381 (2d Cir. 2018)
(rejecting the plaintiffs’ request “to apply strict
scrutiny and to hold that any mandatory disclosure of
a member or donor list is unconstitutional absent a
compelling government interest and narrowly drawn
regulations furthering that interest”); AFPF I, 809
F.3d at 541 (“The district court’s conclusion that the
Attorney General’s demand for national donor
information may be more intrusive than necessary
does not raise serious questions because ‘exacting
scrutiny is not a least-restrictive-means test.’”
(quoting Chula Vista Citizens for Jobs & Fair
Competition v. Norris, 782 F.3d 520, 541 (9th Cir.
2015) (en banc))); Ctr. for Competitive Politics, 784
F.3d at 1312 (“[The plaintiff’s argument] that the
Attorney General must have a compelling interest in
the disclosure requirement, and that the requirement
must be narrowly tailored in order to justify the First
Amendment harm it causes[,] . . . is a novel theory,
but it is not supported by our case law or by Supreme
Court precedent.”).
In short, we apply the “substantial relation”
standard the Supreme Court applied in Doe. “To
withstand this scrutiny, ‘the strength of the
governmental interest must reflect the seriousness of
the actual burden on First Amendment rights.’” Doe,
561 U.S. at 196 (quoting Davis, 554 U.S. at 744).
A. The Strength of the Governmental
Interest
It is clear that the disclosure requirement
serves an important governmental interest. In Center
for Competitive Politics, 784 F.3d at 1311, we
19a
recognized the Attorney General’s argument that
“there is a compelling law enforcement interest in the
disclosure of the names of significant donors.” See also
id. at 1317. The Attorney General observed that “such
information is necessary to determine whether a
charity is actually engaged in a charitable purpose, or
is instead violating California law by engaging in selfdealing, improper loans, or other unfair business
practices,” id. at 1311, and we agreed that “[t]he
Attorney General has provided justifications for
employing a disclosure requirement instead of issuing
subpoenas,” id. at 1317. In AFPF I, we reiterated that
“the Attorney General’s authority to demand and
collect charitable organizations’ Schedule B forms
. . . furthers California’s compelling interest in
enforcing its laws.” AFPF I, 809 F.3d at 538–39.
These conclusions are consistent with those
reached by the Second Circuit, which recently upheld
New York’s Schedule B disclosure requirement
against a challenge similar to the one presented here.
The attorney general explained that the Schedule B
disclosure requirement allows him to carry out “his
responsibility to protect the public from fraud and
self-dealing among tax-exempt organizations.”
Schneiderman, 882 F.3d at 382. The court agreed
with the state that
knowing the source and amount of large
donations can reveal whether a charity
is doing business with an entity
associated with a major donor. The
information in a Schedule B also permits
detection of schemes such as the
intentional overstatement of the value of
noncash donations in order to justify
20a
excessive salaries or perquisites for its
own executives. Collecting donor
information on a regular basis from all
organizations facilitates investigative
efficiency, and can help the Charities
Bureau to obtain a complete picture of
the charities’ operations and flag
suspicious activity simply by using
information already available to the
IRS. Because fraud is often revealed not
by a single smoking gun but by a pattern
of suspicious behavior, disclosure of the
Schedule B can be essential to New
York’s interest in detecting fraud.
Id. (alterations, citations and internal quotation
marks omitted). The Schedule B requirement,
therefore, served the state’s important “interests in
ensuring organizations that receive special tax
treatment do not abuse that privilege and . . . in
preventing those organizations from using donations
for purposes other than those they represent to their
donors and the public.” Id.
The plaintiffs nonetheless question the
strength of the state’s governmental interest, arguing
the Attorney General’s need to collect Schedule B
information is belied by the evidence that he does not
use the information frequently enough to justify
collecting it en masse, he is able to investigate
charities without Schedule B information and he does
not review individual Schedule B forms until he
receives a complaint, at which point he has at his
disposal tools of subpoena and audit to obtain the
Schedule B information he needs. The district court
credited these arguments, concluding that Schedule B
21a
information is not “necessary” to the Attorney
General’s investigations because: the Registry, whose
sole job it is to collect and maintain complete
registration information, does not actively review
Schedule B forms as they come in; Schedule Bs have
not been used to trigger investigations; and the
Attorney General can obtain a Schedule B through
subpoenas and audits when a case-specific need
arises. See Americans for Prosperity Found., 182 F.
Supp. 3d at 1053–54.
We addressed these same arguments, of
course, in Center for Competitive Politics, 784 F.3d at
1317, where we expressly rejected the proposition
that the Schedule B requirement is insufficiently
tailored because the state could achieve its
enforcement goals through use of its subpoena power
or audit letters. We noted that the state’s quick access
to Schedule B filings “increases [the Attorney
General’s] investigative efficiency” and allows him to
“flag suspicious activity.” Id. For example, as the
Attorney General argued in that case,
having significant donor information
allows the Attorney General to
determine when an organization has
inflated its revenue by overestimating
the value of “in kind” donations.
Knowing the significant donor’s identity
allows her to determine what the “in
kind” donation actually was, as well as
its real value. Thus, having the donor’s
information
immediately
available
allows her to identify suspicious
behavior. She also argues that requiring
unredacted versions of Form 990
22a
Schedule B increases her investigative
efficiency and obviates the need for
expensive and burdensome audits.
Id. at 1311.
The evidence at trial confirms our earlier
conclusions. Belinda Johns, the senior assistant
attorney general who oversaw the Charitable Trusts
Section for many years, testified that attempting to
obtain a Schedule B from a regulated entity after an
investigation began was unsatisfactory. She testified
that her office would want “to look at [the] Schedule
B . . . the moment we thought there might be an issue
with the charity.” “[I]f we subpoenaed it or sent a
letter to the charity, that would tip them off to our
investigation, which would allow them potentially to
dissipate more assets or hide assets or destroy
documents, which certainly happened several times;
or it just allows more damage to be done to [the]
charity if we don’t have the whole document at the
outset.” Rather than having “to wait extra days,” she
wanted to “take the action that needs to be taken as
quickly as possible.” She explained that her office
relied on Schedule Bs to “tell us whether or not there
was an illegal activity occurring.” Where such activity
was found, she would “go into court immediately and
. . . request a [temporary restraining order] from the
court to freeze assets.”
Johns’ successor, Tania Ibanez, testified
similarly that “getting a Schedule B through a[n]
audit letter is not the best use of my limited
resources.”
Because it’s time-consuming, and you
are tipping the charity off that they are
23a
about to be audited. And it’s been my
experience when the charity knows or
when the charity gets the audit letter,
it’s not the best way of obtaining records.
We have been confronted in situations
where the charity will fabricate records.
Charities have given us incomplete
records,
nonresponsive
records.
Charities have destroyed records, and
charities have engaged in other dilatory
tactics.
Sonja Berndt, a deputy attorney general in the
Charitable Trusts Section, confirmed that attempting
to obtain Schedule Bs through the auditing process
would entail substantial delay.
The district court’s other conclusions are
equally flawed. Although the state may not routinely
use Schedule B information as it comes in, the
Attorney General offered ample evidence of the ways
his office uses Schedule B information in
investigating charities that are alleged to have
violated California law. See Cal. Corp. Code §§ 5227,
5233, 5236 (providing examples of the role the
Attorney General plays in investigating nonprofit
organizations that violate California law). Current
and former members of the Charitable Trusts Section,
for example, testified that they found the Schedule B
particularly useful in several investigations over the
past few years, and provided examples. They were
able to use Schedule B information to trace money
used for improper purposes in connection with a
charity serving animals after Hurricane Katrina; to
identify a charity’s founder as its principal
contributor, indicating he was using the research
24a
charity as a pass-through; to identify self-dealing in
that same charity; to track a for-profit corporation’s
use of a non-profit organization as an improper vessel
for gain; and to investigate a cancer charity’s gift-inkind fraud.3
In sum, the record demonstrates that the state
has a strong interest in the collection of Schedule B
information from regulated charities. We agree with
the Second Circuit that the disclosure requirement
“clearly further[s]” the state’s “important government
interests” in “preventing fraud and self-dealing in
charities . . . by making it easier to police for such
fraud.” Schneiderman, 882 F.3d at 384.
The district court reached a different
conclusion, but it did so by applying an erroneous
legal standard. The district court required the
Attorney General to demonstrate that collection of
Schedule B information was “necessary,” Thomas
More Law Ctr., 2016 WL 6781090, at *2, that it was
no “more burdensome than necessary” and that the
state could not achieve its ends “by more narrowly
tailored means,” id. at *2–3. Because it was “possible
for the Attorney General to monitor charitable
organizations without Schedule B,” the court
3 The Foundation points out that the Attorney General identified
only five investigations in the past 10 years in which the state
has used Schedule B information to investigate a charity. The
Attorney General, however, identified an additional five
investigations that were still ongoing. The district court did not
allow the Attorney General’s witnesses to testify about those
ongoing investigations, because the Attorney General
understandably refused to name the charities under current
investigation.
25a
concluded the requirement is unconstitutional. Id. at
*2. The “more burdensome than necessary” test the
district court applied, however, is indistinguishable
from the narrow tailoring and least-restrictive-means
tests that we have repeatedly held do not apply here.
The district court’s application of this standard,
therefore, constituted legal error.
Because the district court applied an erroneous
legal standard, it consistently framed the legal
inquiry as whether it was possible “that the Attorney
General could accomplish her goals without the
Schedule B.” Id. at *3. Under the substantial relation
test, however, the state was not required to show that
it could accomplish its goals only by collecting
Schedule B information. The state instead properly
and persuasively relied on evidence to show that the
up-front collection of Schedule B information
improves the efficiency and efficacy of the Attorney
General’s important regulatory efforts. Even if the
Attorney General can achieve his goals through other
means, nothing in the substantial relation test
requires him to forgo the most efficient and effective
means of doing so, at least not absent a showing of a
significant burden on First Amendment rights. As
Steven Bauman, a supervising investigative auditor
for the Charitable Trusts Section testified, “We could
complete our investigations if you took away many of
the tools that we have. We just wouldn’t be as
effective or as efficient.”
Because the strict necessity test the district
court applied is not the law, the district court’s
analysis does not alter our conclusion that the state
has a strong interest in the collection of Schedule B
information from regulated charities.
26a
B. The Seriousness of the Actual Burden
on First Amendment Rights
Having considered the strength of the
governmental interest, we turn to the actual burden
on the plaintiffs’ First Amendment rights.
The Supreme Court has concluded that
“compelled disclosure has the potential for
substantially infringing the exercise of First
Amendment rights.” Buckley v. Valeo, 424 U.S. 1, 66
(1976). To assess “the possibility that disclosure will
impinge upon protected associational activity,” id. at
73, we consider “any deterrent effect on the exercise
of First Amendment rights,” id. at 65.
We may examine, for example, the extent to
which requiring “disclosure of contributions . . . will
deter some individuals who otherwise might
contribute,” including whether disclosure will “expose
contributors to harassment or retaliation.” Id. at 68.
“[T]hat one or two persons refused to make
contributions because of the possibility of disclosure”
will not establish a significant First Amendment
burden. Id. at 72. Nor will a showing that “people may
‘think twice’ about contributing.” Family PAC, 685
F.3d at 807. “[D]isclosure requirements,” however,
“can chill donations to an organization by exposing
donors to retaliation,” Citizens United, 558 U.S. at
370, and “[i]n some instances fears of reprisal may
deter contributions to the point where the movement
cannot survive,” Buckley, 424 U.S. at 71. In such
cases, the First Amendment burdens are indeed
significant.
A party challenging a disclosure requirement,
therefore, may succeed by proving “a substantial
27a
threat of harassment.” Id. at 74. As a general matter,
“those resisting disclosure can prevail under the First
Amendment if they can show ‘a reasonable
probability that the compelled disclosure of personal
information will subject them to threats, harassment,
or reprisals from either Government officials or
private parties.’” Doe, 561 U.S. at 200 (alteration
omitted) (quoting Buckley, 424 U.S. at 74); see also
Citizens United, 558 U.S. at 370.4
Here, the plaintiffs contend requiring them to
comply with the Attorney General’s Schedule B
disclosure requirement will impose a significant First
Amendment burden in two related ways. First, they
contend requiring them to comply with the Schedule
B requirement will deter contributors. Second, they
argue disclosure to the Attorney General will subject
their contributors to threats, harassment and
reprisals. We consider these contentions in turn.
4 In making this showing, we agree with the Attorney General
that the plaintiffs must show a reasonable probability of threats,
harassment or reprisals arising from the Schedule B
requirement itself. But this does not mean the plaintiffs cannot
rely on evidence showing, for example, that their members have
been harassed for other reasons, or evidence that similar
organizations have suffered a loss in contributions as a result of
Schedule B disclosure. To be sure, the extent to which the
plaintiffs’ evidence is tied directly to, or is attenuated from, the
experience of the plaintiffs themselves and the California
Attorney General’s Schedule B requirement in particular goes to
the weight of that evidence. But the plaintiffs may rely on any
evidence that “has any tendency to make a fact more or less
probable than it would be without the evidence.” Fed. R. Evid.
401(a).
28a
1. Evidence That Disclosure Will Deter
Contributors
We begin by considering whether disclosure
will deter contributors. We first consider evidence
presented by the Foundation. We then consider
evidence presented by the Law Center.
Christopher Joseph Fink, the Foundation’s
chief operating officer, testified that prospective
contributors’ “number one concern is about being
disclosed.” He testified that “they are afraid to have
their information in the hands of state government or
a federal government or in the hands of the public.”
He testified that business owners “are afraid if they
are associated with our foundation or with Americans
for Prosperity, their businesses would be targeted or
audited from the state government.” Teresa Oelke,
the Foundation’s vice president of state operations,
described two individuals who, she believed, stopped
supporting the Foundation in light of actual or feared
retaliation by the IRS. One contributor “did business
with the Government,” and he and his business
associates “did not feel like they could take on the risk
of continuing to give to us.” Another contributor
allegedly stopped giving “because he, his business
partner and their business had experienced seven
different reviews from government agencies,
including individual IRS audits, both personally and
their businesses, and their family was not willing to
continue enduring the emotional, financial, time
stress and the stress that it placed on their business.”
Oelke testified that, on average, the Foundation and
Americans for Prosperity combined lose “roughly
three donors a year” due to “their concern that they
are going to be disclosed and the threats that they
29a
believe that being disclosed lays to either their
business, their families or just their employees.” Paul
Schervish, an emeritus professor of sociology, testified
that, in his opinion, disclosure to the California
Attorney General would chill contributions to the
Foundation, although he conceded that he had not
actually spoken to any of the Foundation’s
contributors. Foundation President Tim Phillips
testified that contributors see the California Attorney
General’s office as “a powerful partisan office.” The
Foundation also points to evidence that, in its view,
shows that some California officials harbor a negative
attitude toward Charles and David Koch.
The Law Center introduced a letter from a
contributor who chose to make a $25 contribution
anonymously out of fear that ISIS would break into
the Law Center’s office, obtain a list of contributors
and target them. Schervish, the sociology professor,
opined that the Law Center’s “disclosure of Schedule
B to the registry would chill contributions.” He
acknowledged, however, that he had not spoken with
any of the Law Center’s existing or prospective
contributors, and he could not point to any contributor
who had reduced or eliminated his or her support for
the Law Center due to the fear of disclosure – a
common weakness in the Law Center’s evidence.
For example, Thomas Monaghan, the Law
Center’s co-founder and most well-known contributor,
testified that he is not aware of any Law Center
contributor who was “harassed in some way because
they made a donation.” Despite being included “at the
top of a list . . . of the most antigay persons in the
country” (allegedly because of his financial support
for the Law Center), he remains “perfectly willing” to
30a
be listed on the Law Center’s website as “one of the
people who helped to establish” the Law Center.
Similarly, the Law Center’s president testified that he
has never had a conversation with a potential
contributor who was unwilling to contribute to the
Law Center because of the public controversy
surrounding the Law Center or its disclosure
requirements. For years, moreover, the Law Center
has over-disclosed contributor information on
Schedule Bs filed with the IRS. Although by law the
Law Center is required to disclose only those
contributors furnishing 2 percent or more of the
organization’s receipts (about five to seven
contributors a year), it has instead chosen to disclose
all contributors providing $5,000 or more in financial
support (about 23 to 60 contributors a year). This
voluntary over-disclosure tends to undermine the
Law Center’s contention that Schedule B disclosure
meaningfully deters contributions.
Considered as a whole, the plaintiffs’ evidence
shows that some individuals who have or would
support the plaintiffs may be deterred from
contributing if the plaintiffs are required to submit
their Schedule Bs to the Attorney General. The
evidence, however, shows at most a modest impact on
contributions. Ultimately, neither plaintiff has
identified a single individual whose willingness to
contribute hinges on whether Schedule B information
will be disclosed to the California Attorney General.
Although there may be a small group of contributors
who are comfortable with disclosure to the IRS, but
who would not be comfortable with disclosure to the
Attorney General, the evidence does not show that
31a
this group exists or, if it does, its magnitude. As the
Second Circuit explained:
While we think it plausible that some
donors will find it intolerable for law
enforcement officials to know where they
have made donations, we see no reason
to believe that this risk of speech chilling
is more than that which comes with any
disclosure regulation. In fact, all entities
to which these requirements apply
already comply with the federal law
mandating that they submit the
selfsame information to the IRS.
Appellants offer nothing to suggest that
their donors should more reasonably
fear having their identities known to
New York’s Attorney General than
known to the IRS.
Schneiderman, 882 F.3d at 384.
The mere possibility that some contributors
may choose to withhold their support does not
establish a substantial burden on First Amendment
rights. A plaintiff cannot establish a significant First
Amendment burden by showing only “that one or two
persons refused to make contributions because of the
possibility of disclosure,” Buckley, 424 U.S. at 72, or
that “people may ‘think twice’ about contributing,”
Family PAC, 685 F.3d at 807. The evidence presented
by the plaintiffs here does not show that disclosure to
the Attorney General will “actually and meaningfully
deter contributors,” id., or that disclosure would
entail “the likelihood of a substantial restraint upon
the exercise by [their contributors] of their right to
32a
freedom of association,” NAACP v. Alabama ex rel.
Patterson, 357 U.S. 449, 462 (1958).5 Cf. Bates v. City
of Little Rock, 361 U.S. 516, 521 n.5 (1960) (between
100 and 150 members declined to renew their NAACP
membership, citing disclosure concerns); Dole v. Serv.
Emps. Union, AFL-CIO, Local 280, 950 F.2d 1456,
1460 (9th Cir. 1991) (placing particular weight on two
letters explaining that because meeting minutes
might be disclosed, union members would no longer
attend meetings).
The Schedule B requirement, moreover, is not
a sweeping one. It requires the Foundation and the
Law Center to disclose only their dozen or so largest
contributors, and a number of these contributors are
already publicly identified, because they are private
foundations which by law must make their
expenditures public. As applied to these plaintiffs,
therefore, the Schedule B requirement is a far cry
from the broad and indiscriminate disclosure laws
passed in the 1950s to harass and intimidate
members of unpopular organizations. See, e.g.,
Gremillion, 366 U.S. at 295 (invalidating a state law
requiring every organization operating in the state “to
file with the Secretary of State annually ‘a full,
complete and true list of the names and addresses of
all of the members and officers’ in the State”); Shelton,
5
“In NAACP, the Court was presented . . . with ‘an
uncontroverted showing that on past occasions revelation of the
identity of its rank-and-file members has exposed those
members to economic reprisal, loss of employment, [and] threat
of physical coercion,’ and it was well known at the time that civil
rights activists in Alabama and elsewhere had been beaten
and/or killed.” Schneiderman, 882 F.3d at 385 (second alteration
in original) (quoting NAACP, 357 U.S. at 462).
33a
364 U.S. at 480 (invalidating a state law “compel[ing]
every teacher, as a condition of employment in a statesupported school or college, to file annually an
affidavit listing without limitation every organization
to which he has belonged or regularly contributed
within the preceding five years”).
In sum, the plaintiffs have not shown a
significant First Amendment burden on the theory
that complying with the Attorney General’s Schedule
B nonpublic disclosure requirement will chill
contributions.
2. Evidence That Disclosure to the Attorney
General Will Subject Contributors to
Threats, Harassment and Reprisals
Alternatively, the plaintiffs seek to establish a
First Amendment burden by showing that, if they are
required to disclose their Schedule B information to
the Attorney General, there is “a reasonable
probability that the compelled disclosure of personal
information will subject [their contributors] to
threats, harassment, or reprisals from either
Government officials or private parties.” Doe, 561
U.S. at 200 (alteration omitted) (quoting Buckley, 424
U.S. at 74). This inquiry necessarily entails two
questions: (1) what is the risk of public disclosure; and
(2), if public disclosure does occur, what is the
likelihood that contributors will be subjected to
threats, harassment or reprisals? We consider these
questions in reverse order.
a. Likelihood of Retaliation
The first question, then, is whether the
plaintiffs have shown that contributors are likely to
34a
be subjected to threats, harassment or reprisals if
Schedule B information were to become public. We
again consider the Foundation’s evidence first,
followed by the Law Center’s evidence.
The Foundation’s evidence undeniably shows
that some individuals publicly associated with the
Foundation have been subjected to threats,
harassment or economic reprisals. Lucas Hilgemann,
the Foundation’s chief executive officer, testified that
he was harassed and targeted, and his personal
information posted online, in connection with his
work surrounding union “right to work” issues in
Wisconsin. Charles and David Koch have received
death threats, and Christopher Fink, the
Foundation’s chief operating officer, has received
death threats for publicly contributing to the
Foundation through his family’s private foundation.
Art Pope, a member of the Foundation’s board of
directors, and a contributor through his family
foundation, testified that he received a death threat
and has been harassed by “a series of articles” that
falsely accuse him of “funding global warming
deni[al].” His businesses have been boycotted,
although we hesitate to attribute those boycotts to
Pope’s association with the Foundation.6
6 Pope says his business, Variety Wholesalers, was boycotted in
part because of his affiliation with the Foundation. But Pope was
the state budget director of North Carolina and is publicly
associated with a large number of organizations and candidates.
Despite publicly contributing to the Foundation since 2004, and
to the Foundation’s predecessor since 1993, he did not receive
threats or negative attention until 2010, in connection with his
involvement in the North Carolina elections. This same problem
plagues much of the plaintiffs’ evidence. In many instances, the
35a
In some cases, moreover, the Foundation’s
actual or perceived contributors may have faced
economic reprisals or other forms of harassment.
Teresa Oelke, for instance, cited
a donor whose business was targeted by
an association, a reputable association
in that state. A letter was sent to all the
school boards in that state encouraging
[them] to discontinue awarding this
individual’s business contracts because
of his assumed association with
Americans for Prosperity and Americans
for Prosperity Foundation. . . . That
individual reduced his contributions in
half, so from $500,000 annually to
250,000 based on the pressure from his
board that remains in place today.
Hilgemann, the Foundation’s CEO, suggested that
during the “right to work” campaign in Wisconsin in
2012, an opposition group “pulled together a list of
suspected donors to the Foundation because of their
interactions with groups like ours in the past that had
evidence of harassment pertains to individuals who are publicly
identified with a number of controversial activities or
organizations, making it difficult to assess the extent to which
the alleged harassment was caused by a connection to the
Foundation or the Law Center in particular. Most of the
individuals who have experienced harassment, moreover, have
been more than mere contributors, again making it difficult to
isolate the risk of harassment solely from being a large
contributor. The plaintiffs have presented little evidence bearing
on whether harassment has occurred, or is likely to occur, simply
because an individual or entity provided a large financial
contribution to the Foundation or the Law Center.
36a
been publicized. [Opponents] boycotted their
businesses. They made personal and private threats
against them, their families and their business and
their employees.”7
The Law Center, too, has presented some
evidence to suggest individuals associated with the
Law Center have experienced harassment, although
it is less clear to what extent it results solely from that
association. The Law Center, for instance, points to: a
smattering of critical letters, phone calls and emails
it has received over the years; the incident in which
Monaghan was placed on a list of “the most antigay
persons in the country” after the Law Center became
involved in a controversial lawsuit; and threats and
harassment its clients, such as Robert Spencer and
Pamela Geller, have received based on their
controversial public activities. As noted, however,
Monaghan could not recall any situation in which a
contributor to the Law Center was harassed, or
expressed concerns about being harassed, on account
of having contributed to the Law Center.
On the one hand, this evidence plainly shows
at least the possibility that the plaintiffs’ Schedule B
contributors would face threats, harassment or
7
Like much of the plaintiffs’ evidence, the harassment
allegations recounted by Oelke and Hilgemann are conclusory
rather than detailed. Although we understand the plaintiffs’
interest in protecting their contributors’ identities from
disclosure, we cannot imagine why the plaintiffs have not
provided more detailed evidence to substantiate and develop
their allegations of retaliation – something we are confident they
could have accomplished without compromising their
contributors’ anonymity.
37a
reprisals if their information were to become public.
Such harassment, however, is not a foregone
conclusion. In 2013, after acquiring copies of the
Foundation’s 2001 and 2003 Schedule B filings, the
National Journal published an article publicly
identifying many of the Foundation’s largest
contributors.8 If, as the plaintiffs contend, public
disclosure of Schedule B information would subject
their contributors to widespread retaliation, we would
expect the Foundation to present evidence to show
that, following the National Journal’s unauthorized
Schedule B disclosure, its contributors were harassed
or threatened. No such evidence, however, has been
presented.
Ultimately, we need not decide whether the
plaintiffs have demonstrated a reasonable probability
that the compelled disclosure of Schedule B
information would subject their contributors to a
constitutionally significant level of threats,
harassment or reprisals if their Schedule B
information were to become public. See Doe, 561 U.S.
at 200.9 As we explain next, we are not persuaded that
there exists a reasonable probability that the
8 The record does not reflect how the National Journal acquired
this information. No one has suggested that the California
Attorney General’s office was the source, nor could it have been,
as the Foundation was not reporting its Schedule B contributors
to the state in 2001 or 2003.
9
The district court concluded the plaintiffs have shown a
“reasonable probability” that public disclosure of their Schedule
B contributors would subject them to such threats and
harassment. Because this constitutes a mixed question of law
and fact, however, we review the question de novo. See In re
Cherrett, 873 F.3d 1060, 1066 (9th Cir. 2017).
38a
plaintiffs’ Schedule B information will become public
as a result of disclosure to the Attorney General.
Thus, the plaintiffs have not established a reasonable
probability of retaliation from compliance with the
Attorney General’s disclosure requirement.
b. Risk of Public Disclosure
The parties agree that, as a legal matter, public
disclosure of Schedule B information is prohibited.
California law allows for public inspection of
charitable trust records, with the following exception:
Donor information exempt from public
inspection pursuant to Internal
Revenue Code section 6104(d)(3)(A)
shall be maintained as confidential by
the Attorney General and shall not be
disclosed except as follows:
(1) In a court or administrative
proceeding brought pursuant to the
Attorney General’s charitable trust
enforcement responsibilities; or
(2) In response to a search warrant.
Cal. Code Regs. tit. 11, § 310(b).10 The plaintiffs
argue, however, that their Schedule B information
may become public because the Attorney General has
The plaintiffs suggest California’s regulations are not as
protective as federal regulations because federal law imposes
criminal penalties for unauthorized disclosure of information on
tax returns. See 26 U.S.C. § 7213. Federal law, however,
criminalizes only willful unauthorized disclosure; the
differences between federal and California law are therefore
immaterial to risk of inadvertent public disclosure at issue here.
10
39a
a poor track record of shielding the information from
the public view.
We agree that, in the past, the Attorney
General’s office has not maintained Schedule B
information as securely as it should have, and we
agree with the plaintiffs that this history raises a
serious concern. The state’s past confidentiality
lapses are of two varieties: first, human error when
Registry staff miscoded Schedule B forms during
uploading; and second, a software vulnerability that
failed to block access to the Foundation’s expert,
James McClave, as he probed the Registry’s servers
for flaws during this litigation.
We are less concerned with the latter lapse.
McClave discovered that by manipulating the
hexadecimal ending of the URL corresponding to each
file on the Registry website, he could access a file that
was confidential and did not correspond to a clickable
link on the website. That is, although documents were
deemed “confidential,” that meant only that they were
not visible to the public; it did not mean they were not
still housed on the public-facing Registry website. By
altering the single digit at the end of the URL,
McClave was able to access, one at a time, all 350,000
of the Registry’s confidential documents. This lapse
was a singularity, stemming from an issue with the
Attorney General’s third-party security vendor. When
it was brought to the Attorney General’s attention
during trial, the vulnerability was quickly remedied.
There is no evidence to suggest that this type of error
is likely to recur.
We are more concerned with human error. As
part of an iterative search on the public-facing
40a
website
of
the
Registry,
McClave
found
approximately 1800 confidential Schedule Bs that
had been misclassified as public over several years.
The Attorney General promptly removed them from
public access, but some had remained on the website
since 2012, when the Registry began loading its
documents to servers.
Much of this error can be traced to the large
amount of paper the Registry Unit processes around
the same time each year. The Registry Unit receives
over 60,000 registration renewals annually, and 90
percent are filed in hard copy. It processes each by
hand before using temporary workers and student
workers to scan them into an electronic record
system. The volume and tediousness of the work
seems to have resulted in some staff occasionally
mismarking confidential Schedule Bs as public and
then uploading them to the public-facing site.
Recognizing the serious need to protect
confidentiality, however, the Registry Unit has
implemented stronger protocols to prevent human
error. It has implemented “procedural quality checks
. . . to sample work as it [is] being performed” and to
ensure it is “in accordance with procedures on
handling documents and [indexing them] prior to
uploading.” It has further implemented a system of
text-searching batch uploads before they are scanned
to the Registry site to ensure none contains Schedule
B keywords. At the time of trial in 2016, the Registry
Unit had halted batch uploads altogether in favor of
loading each document individually, as it was refining
the text-search system. After forms are loaded to the
Registry, the Charitable Trusts Section runs an
automated weekly script to identify and remove any
41a
documents that it had inadvertently misclassified as
public. There is also no dispute that the Registry Unit
immediately removes any information that an
organization identifies as having been misclassified
for public access.
Nothing is perfectly secure on the internet in
2018, and the Attorney General’s data are no
exception, but this factor alone does not establish a
significant risk of public disclosure. As the Second
Circuit recently explained, “[a]ny form of disclosurebased regulation – indeed, any regulation at all –
comes with some risk of abuse. This background risk
does not alone present constitutional problems.”
Schneiderman, 882 F.3d at 383.
Although the plaintiffs have shown the state
could afford to test its own systems with more
regularity, they have not shown its cybersecurity
protocols are deficient or substandard as compared to
either the industry or the IRS, which maintains the
same confidential information.11 We agree with the
Second Circuit that “there is always a risk somebody
in the Attorney General’s office will let confidential
11 Although the plaintiffs contend that the Charitable Trusts
Section’s protective measures are inadequate because they
impose no physical or technical impediments to prevent
employees from emailing Schedule Bs externally or printing
them in the office, the record does not show that the IRS
maintains a more secure internal protocol for its handling of
Schedule B information or that the Charitable Trusts Section is
failing to meet any particular security standard. Nonetheless,
we take seriously the concerns raised here by the plaintiffs and
amici, and we encourage all interested parties to work
cooperatively to ensure that Schedule B information in the
hands of the Attorney General remains confidential.
42a
information slip notwithstanding an express
prohibition. But if the sheer possibility that a
government agent will fail to live up to her duties
were enough for us to assume those duties are not
binding, hardly any government action would
withstand our positively philosophical skepticism.”
Id. at 384.
Although the district court appears to have
concluded that there is a high risk of public disclosure
notwithstanding the promulgation of § 310 and the
Attorney General’s adoption of additional security
measures, the court appears to have rested this
conclusion solely on the state’s past “inability to
ensure confidentiality.” Thomas More Law Ctr., 2016
WL 6781090, at *5. In light of the changes the
Attorney General has adopted since those breaches
occurred, however, the evidence does not support the
inference that the Attorney General is likely to
inadvertently disclose either the Law Center’s or the
Foundation’s Schedule B in the future. The risk of
inadvertent disclosure of any Schedule B information
in the future is small, and the risk of inadvertent
disclosure of the plaintiffs’ Schedule B information in
particular is smaller still. To the extent the district
court found otherwise, that finding was clearly
erroneous.
Given the slight risk of public disclosure, we
cannot say that the plaintiffs have shown “a
reasonable probability that the compelled disclosure
of personal information will subject them to threats,
harassment, or reprisals.” See Doe, 561 U.S. at 200
(alteration omitted) (quoting Buckley, 424 U.S. at 74).
43a
In sum, the plaintiffs have not shown that
compliance with the Attorney General’s Schedule B
requirement
will
impose
significant
First
Amendment burdens. The plaintiffs have not
demonstrated that compliance with the state’s
disclosure requirement will meaningfully deter
contributions. Nor, in light of the low risk of public
disclosure, have the plaintiffs shown a reasonable
probability of threats, harassment or reprisals.
Because the burden on the First Amendment right to
association is modest, and the Attorney General’s
interest in enforcing its laws is important, Ctr. for
Competitive Politics, 784 F.3d at 1317, “the strength
of the governmental interest . . . reflect[s] the
seriousness of the actual burden on First Amendment
rights.” Doe, 561 U.S. at 196 (quoting Davis, 554 U.S.
at 744). As applied to the plaintiffs, therefore, the
Attorney General’s Schedule B requirement survives
exacting First Amendment scrutiny.
IV.
The plaintiffs’ facial challenges also fail. In
AFPF I, we held that we were “bound by our holding
in Center for Competitive Politics, 784 F.3d at 1317,
that the Attorney General’s nonpublic Schedule B
disclosure regime is facially constitutional.” AFPF I,
809 F.3d at 538. That holding constitutes the law of
the case. See Ranchers Cattlemen Action Legal Fund
United Stockgrowers of Am. v. U.S. Dep’t of Agric., 499
F.3d 1108, 1114 (9th Cir. 2007) (“[T]he general rule
[is] that our decisions at the preliminary injunction
phase do not constitute the law of the case. Any of our
conclusions on pure issues of law, however, are
binding.” (citations and internal quotation marks
omitted)). Even if we were to consider the facial
44a
challenges anew, the evidence adduced at these trials
does not prove the Schedule B requirement “fails
exacting scrutiny in a ‘substantial’ number of cases,
‘judged in relation to [its] plainly legitimate sweep.’”
Ctr. for Competitive Politics, 784 F.3d at 1315
(quoting United States v. Stevens, 559 U.S. 460, 473
(2010)).
We also reject the Law Center’s cross-appeal as
to its Fourth Amendment and preemption claims.
These claims were not proved at trial. We decline to
consider the Law Center’s motion for attorney’s fees
because it was not presented to the district court.
Finally, we deny the Law Center’s motion for judicial
notice and the Attorney General’s motion to strike
portions of the Law Center’s reply brief.
The judgments of the district court are
reversed. The permanent injunctions are vacated.
The case is remanded for entry of judgments in favor
of the Attorney General.
INJUNCTIONS VACATED; JUDGMENTS
REVERSED; CASES REMANDED.
The Law Center’s motion for judicial notice,
filed February 12, 2018 (Dkt. 45, No. 16-56855) is
DENIED.
The Attorney General’s motion to strike, filed
February 13, 2018 (Dkt. 47, No. 16-56855), is
DENIED.
45a
46a
47a
48a
49a
50a
*****
51a
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
THOMAS MORE LAW
CENTER,
Plaintiff,
v.
KAMALA HARRIS, in her
Official Capacity as Attorney
General of California,
Defendant.
) CASE NO.
) CV 15-3048-R
)
) ORDER FOR
) JUDGMENT
) IN FAVOR OF
) PLAINTIFF
)
)
)
)
)
For the reasons that follow, this Court grants
Thomas More Law Center’s (“TMLC”) motion for a
permanent injunction to enjoin the Attorney General
of California from demanding its Schedule B form and
enters judgment in favor of TMLC. After conducting
a full bench trial, this Court finds the Attorney
General’s Schedule B disclosure requirement
unconstitutional as applied to TMLC.
Plaintiff TMLC is a nonprofit corporation
organized under Internal Revenue Code section
501(c)(3) that funds its activities by raising charitable
contributions from donors throughout the country,
including California. California state law requires
charitable organizations, such as TMLC, to file a copy
of its IRS Form 990, including its Schedule B, with
the State Registry of Charitable Trusts (“the
Registry”). Cal. Code Regs. tit. 11, § 301. An
52a
organization’s Schedule B includes the names and
addresses of every individual nationwide who
donated more than $5,000 to a charity during a given
tax year. While a nonprofit’s IRS Form 990 must be
made available to the public, an organization’s
Schedule B is not publicly available. 26 U.S.C. §
6104(b), (d)(3)(A).
Since 2001, TMLC filed its Form 990 as part of
its periodic reporting with the Attorney General,
without including its Schedule B. For each year from
2001 through 2009, the Attorney General accepted
TMLC’s registration renewal and listed TMLC as an
active charity in compliance with the law. In a letter
dated March 6, 2012, the Attorney General indicated
that TMLC’s 2010 filing was insufficient due to its
failure to include a Schedule B. In April 2015, TMLC
brought the present action seeking an order
preliminarily enjoining the Attorney General from
demanding its Schedule B. Among other claims,
TMLC argued that the California law requiring
disclosure of its Schedule B to the Attorney General
was facially unconstitutional. TMLC also brought an
as-applied challenge against the disclosure
requirement.
This Court granted Plaintiff a preliminary
injunction, which the Ninth Circuit vacated.
Americans for Prosperity Found. v. Harris, 809 F.3d
536 (9th Cir. 2015). In its remand, the Ninth Circuit
held that this Court is bound by its previous decision
in Center for Competitive Politics v. Harris, 784 F.3d
1307, 1317 (9th Cir. 2015)—that the Attorney
General’s nonpublic Schedule B disclosure regime
was not facially unconstitutional. Americans for
Prosperity Found., 809 F.3d at 538. The Ninth Circuit
53a
did, however, instruct this Court to have a trial on the
as-applied challenge. Id. at 543. Accordingly, the
Court now focuses on TMLC’s as-applied challenge.
Courts review First Amendment challenges to
disclosure requirements under an “exacting scrutiny”
standard. John Doe No. 1 v. Reed, 561 U.S. 186, 196
(2010); Citizens United v. FEC, 558 U.S. 310, 366
(2010). Exacting scrutiny “requires a ‘substantial
relation’ between the disclosure requirement and a
‘sufficiently important’ governmental interest.”
Center for Competitive Politics, 784 F.3d at 1312
(citations omitted). This encompasses a balancing
test. In order for a government action to survive
exacting scrutiny, “the strength of the governmental
interest must reflect the seriousness of the actual
burden on First Amendment rights.” John Doe No. 1,
561 U.S. at 196.
I.
Substantial Relation to a Sufficiently
Important Governmental Interest
Defendant argues that the state law requiring
that all charities file a complete copy of IRS Form 990
Schedule B is substantially related to the Attorney
General’s compelling interest in protecting the public
and ensuring that charitable organizations are not
abusing their legal privileges. The Attorney General
argues that the disclosure of Schedule B allows the
Registry to determine how much revenue a charity
receives and who is donating to the charitable
organization and in what form. According to the
Attorney General, the Schedule B information assists
her office in determining whether an organization has
violated the law, including laws against self-dealing,
improper loans, interested persons, or illegal or unfair
54a
business practices. The Court finds that as applied,
the disclosure of the Schedule B form is not
substantially related to the Attorney General’s
interest in monitoring and investigating charitable
organizations. First, the Attorney General’s
arguments that Schedule B is necessary is undercut
by the fact that she has only recently determined a
need for the information and has access to the same
information from other sources. Second, even
assuming arguendo that this information does
genuinely assist in the Attorney General’s
investigations, its disclosure demand of Schedule B is
more burdensome than necessary.
Although Center for Competitive Politics found
that the Attorney General’s “disclosure requirement
bears a ‘substantial relation’ to a ‘sufficiently
important’ government interest,” this Court, for the
second time, held a bench trial and was left
unconvinced that the Attorney General’s collection of
Schedule B forms substantially assists the
investigation of charitable organizations. TMLC, like
Americans for Prosperity, was registered with the
Registry for years and was never required to disclose
its Schedule B. It was not until 2012 that the Attorney
General first notified TMLC that it was required to
file its Schedule B. This fact alone indicates that it is
indeed possible for the Attorney General to monitor
charitable organizations without Schedule B. The
Attorney General undoubtedly had the same interest
in protecting the public and monitoring charitable
organizations prior to 2012. Yet, she was able to
further this interest without the collection of TMLC’s
Schedule B.
55a
Portions of the Americans for Prosperity
testimony and evidence were admitted in the TMLC
trial. Particularly relevant here is the testimony of a
supervising investigative auditor for the Attorney
General, Steve Bauman. Mr. Bauman’s trial
testimony confirmed that auditors and attorneys
seldom use Schedule B when auditing or
investigating charities. Bauman testified that out of
the approximately 540 investigations conducted over
the past ten years in the Charitable Trusts Section,
only five instances involved the use of a Schedule B.
(Exhibit 913, AFPF v. Harris, Bauman Test., 3/4/16,
p. 19:15-19). Even in the few instances in which a
Schedule B was relied on, the relevant information it
contained could have been obtained from other
sources. (Exhibit 913, AFPF v. Harris, Bauman Test.
3/4/16, p. 31:8–32:10).
At trial in the present case, the Attorney
General presented the testimony of Tania Ibanez, the
head of the Attorney General’s Charitable Trusts
Section. Ms. Ibanez testified that her office uses
Schedule B regularly to assist in the evaluation of the
merits of complaints and assess the legality of a
charitable organization’s finances. Additionally,
Joseph Zimring, a Deputy Attorney General in the
Charity and Trusts section, testified that he has used
a Schedule B in an investigation he was involved in.
However, Zimring also testified that it was “very
likely” that he could have completed a successful
investigation without a Schedule B and that other
sources, such as Schedule L, contain the same
information as Schedule B. (Zimring Test., 9/14/16, p.
80:11-18, 81:18-19). Ms. Ibanez’s testimony
establishes nothing more than a convenience and
56a
general usage of Schedule B. This Court does not
doubt that the Attorney General does in fact use the
Schedule Bs it collects. However, Mr. Zimring’s
testimony also indicates that the Attorney General is
more than capable of protecting the public and
enforcing the laws by other means. The numerous
other means by which the Attorney General could
obtain the information she needs to investigate
charitable organizations show that the collection of
the Schedule B is not substantially related to her
important interest.
It is apparent to this Court that the Attorney
General’s requirement of Schedule B is not
substantially related to its interest in regulating
charitable organizations. Furthermore, the Attorney
General’s interest could be more narrowly achieved.
In the context of associational rights, “even
though the governmental purpose [may] be legitimate
and substantial, that purpose cannot be pursued by
means that broadly stifle fundamental personal
liberties when the end can be more narrowly
achieved.” Louisiana v. NAACP, 366 U.S. 293, 296
(1961). This differs from the electoral context. The
Ninth Circuit has held that disclosure of electoral
donations and financing information is not subject to
a least-restrictive-means analysis. Chula Vista
Citizens for Jobs & Fair Competition v. Norris, 782
F.3d 520, 541 (9th Cir. 2015). This Court does not hold
the Attorney General to a least-restrictive-means
standard. However, the Attorney General is limited to
pursuing its interest in protecting the public from
illegal charitable organizations by means which do
not “broadly stifle fundamental personal liberties
when the end can be more narrowly achieved.”
57a
Here, like in NAACP, the Attorney General’s
interests can be more narrowly achieved as evidenced
by the testimony of Zimring and Bauman. As was the
case in the Americans for Prosperity Foundation
(“AFPF”) trial, there is substantial evidence that the
Attorney General could accomplish her goals without
the Schedule B. During the AFPF trial, the Attorney
General’s investigators testified that they have
successfully completed their investigations without
using Schedule Bs, even in instances where they
knew Schedule Bs were missing. For example, Mr.
Bauman testified that he reviewed Form 990s in
connection with audits that did not include Schedule
Bs. (Bauman Test. 3/4/16, p. 27:12–14). Specifically,
he admitted that he successfully audited those
charities and found wrongdoing without the use of
Schedule Bs. (Id. at 27:18–23). In fact, Mr. Bauman
admitted that he successfully audited charities for
years before the Schedule B even existed. (Bauman
Dep., TX-731, p. 49:2–15). In the TMLC trial, Mr.
Zimring testified that he had simply asked
individuals who filed complaints against charitable
organizations for information which would otherwise
appear on a Schedule B. Additionally, Mr. Zimring
testified that in an investigation into fraudulent loans
to a charitable organization, much of the information
he pursued could have been obtained through a
different attachment to the organization’s Form 990,
Schedule L. (Zimring Test., 9/14/16, p.81:15-22).
Taken together, the testimony of multiple lawyers
within the Attorney General’s office clearly indicate
that the Attorney General could have achieved its end
by more narrowly tailored means. While this Court
cannot find such a disclosure requirement facially
58a
invalid, it is prepared to find it unconstitutional as
applied to TMLC, especially in light of the
requirement’s burdens on TMLC’s First Amendment
rights.
II.
Burden on First Amendment Rights
Setting aside the Attorney General’s failure to
establish a substantial relationship between her
demand for TMLC’s Schedule B and a compelling
governmental interest, TMLC would independently
prevail on its as-applied challenge because it has
proven that disclosing its Schedule B to the Attorney
General would create a burden on its First
Amendment rights. While the Ninth Circuit in Center
for Competitive Politics foreclosed any facial challenge
to the Schedule B requirement, it specifically left open
the possibility that a party could show “‘a reasonable
probability that the compelled disclosure of [its]
contributors’ names will subject them to threats,
harassment, or reprisal from either Government
officials or private parties’ that would warrant relief
on an as-applied challenge.” 784 F.3d at 1317 (quoting
McConnell v. FEC, 540 U.S. 93, 199 (2003)). The
Supreme Court has noted a particular need for
protection of “minor political part[ies] which
historically ha[ve] been the object of harassment by
government officials and private parties.” Brown v.
Socialist Workers ’74 Campaign Comm., 459 U.S. 87,
88 (1982). “A strict requirement that chill and
harassment be directly attributable to the specific
disclosure from which the exemption is sought would
make the task even more difficult.” Id. at 74.
Examples of the type of evidence sufficient to succeed
on an as-applied challenge include past or present
harassment of members due to their associational
59a
ties, or of harassment directed against the
organization itself, or a pattern of threats or specific
manifestations of public hostility. Id. TMLC produced
evidence of such harassment and hostility at trial.
TMLC is an advocate for issues which arouse
intense passions by its supporters and its opponents.
The Law Center represents clients who are in the
midst of intense public scrutiny and often times on the
receiving end of extremely negative criticism and
insults. These positions taken by TMLC have led to
threats, harassing calls, intimidating and obscene
emails, and even pornographic letters sent to TMLC.
(See, e.g., Exhibit 38, 39). In one particularly angry
letter to TMLC in response to a request for donations
an opponent wrote, “YOU FU**ING FEAR
MONGERING PIECE OF S**T F**K YOU!!!”
(Exhibit 38). Opponents also mailed pornographic
images to TMLC. (Exhibit 39). The level of
harassment and “vehement criticism” directed
towards TMLC has necessitated the Law Center’s
President, Richard Thompson, to train his employees
how to effectively handle and respond to the
negativity. Members and donors of TMLC obviously
share the same views as TMLC. Thus, the evidence of
threats and harassment directed toward TMLC
because of their views indicates a high likelihood of
similar treatment towards donors. It also satisfies the
requirement of Center for Competitive Politics that an
organization show “a reasonable probability” that the
disclosure of TMLC’s donors would subject them to
threats or harassment.
Additionally, TMLC produced evidence of one
donor who suffered negative consequences as a result
of his support of TMLC issues and another donor who
60a
supported TMLC but wished to remain anonymous
for fear of harassment as a result of his affiliation.
Tom Monaghan was the founder of TMLC and also a
donor. Mr. Monaghan was listed at the top of a list of
“most antigay persons in the country.” (Exhibit 908,
Monaghan Dep., at p. 33:21, 34:5-23). Due to his
opposition to abortion, an issue which TMLC
consistently advances, Mr. Monaghan’s business was
boycotted by the National Organization for Women.
(Id. at p. 43:23-44:9). Furthermore, TMLC produced a
donation accompanied by a letter which stated that
the donor did not want to provide his personal
information because the donor feared there would be
consequences of being personally tied to TMLC.
(Thompson Test., 9/13/16, Vol. 1, p. 62:9-24).
The Attorney General argues that little can be
drawn from the testimony of Mr. Monaghan and the
letter from the anonymous donor. First, the Attorney
General argues that Mr. Monaghan and TMLC do not
“connect Mr. Monaghan’s inclusion on [the antigay
list] to his donations to the Law Center, as opposed to
his public status as a member of the Law Center’s
board.” (Defendant’s Proposed
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