Supreme Court Agrees to Hear Fundraising/Free Speech Cases

Date01 March 2021
Published date01 March 2021
The US Supreme Court, on January 8, granted certiorari in two major
cases involving the issue of forced disclosure of donor information, by fundraising
charitable organizations, to state regulators (American for Prosperity Foundation
v. Becerra; Thomas More Law Center v. Becerra). These cases concern the present
practice of the California attorney general, consisting of the demand for infor-
mation about registered charities’ donor information and the refusal of the US
Court of Appeals for the Ninth Circuit to respect constitutional law protections
afforded charities and their members and donors. The petition to the Supreme
Court observed that the Ninth Circuit “has opened the door for the major donors
of thousands of charities to be exposed and chilled through California’s dragnet.”
The question formally presented by this petition to the Court (the first Quote
of the Month in the November 2019 issue) is “[w]hether the exacting scrutiny
this Court has long required of laws that abridge the freedom of speech and
association outside the election context—and called for by NAACP v. Alabama
ex rel. Patterson … and its progeny—can be satisfied absent any showing that
a blanket governmental demand for the individual identities and addresses of
major donors to private nonprofit organizations is narrowly tailored to an asserted
law-enforcement interest.”
The posture of the Ninth Circuit in these cases is summarized in the Novem-
ber 2018 issue. The court’s refusal of a rehearing before the full appellate panel
gave rise to a vigorous dissent, which is summarized in the June 2019 issue. The
petition to the Court is summarized in the November 2019 issue.
The petition filed in the American for Prosperity Foundation case asserts that
the Ninth Circuit’s decision “warrants review because it threatens grave harm
to vital First Amendment interests on a national basis.” The appellate court’s
holding “condones compelled disclosures from tens of thousands of charities
across the country, merely because they operate and register in California.”
The petition states that the “resulting chill will be felt nationwide as numerous © 2021 Wiley Periodicals LLC
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Analysis of current developments in tax
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Volume 38 Number 3
March 2021
Also in This issue...
Final Excess Compensation Regs
Issued 2
Selected Provisions of
Coronavirus and FY 2021
Appropriations Legislation 3
IRS Applies Public Policy
Doctrine—Twice 4
IRS Chief Counsel Advises
Denials as to 27-Month
Rule Relief 4
TIGTA Evaluates EO Examination
Case Consolidation Efforts 5
Charitable Deductions Lost, on
Appeal, Due to Partial Interest
Gift and Faulty Appraisals 6
Other Recent IRS Private
Letter Rulings 7
IRS Issues Procedural Rules
for 2021 7
Taxpayer First Act Report
Delivered 8
Other Development 8

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