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Calif. AG Says Kochs Not Harmed by Donor Disclosure

PASADENA, Calif. (CN) - A lawyer for the California Attorney General on Wednesday asked the Ninth Circuit to force a Koch brothers advocacy foundation to open its donor list, arguing there is no evidence disclosure would chill the group's free-speech rights.

Earlier this year, U.S. District Judge Manuel Real granted Americans for Prosperity Foundation's motion for a preliminary injunction that allows donors to the group to remain anonymous.

The conservative advocate of free-market economic policies sued California Attorney General Kamala Harris in 2014, claiming the prosecutor violates their First Amendment rights by not allowing them to keep the names secret.

Backed by the billionaire Koch brothers, the group said in its filing that the Schedule B federal tax form that it filed with IRS listed 990 the names and addresses of its donors.

The group claims that it has submitted documentation to renew its registration in California but never had to file the Schedule B until 2013, when Harris "out of the blue" said the foundation could not register without submitting the tax form.

Americans for Prosperity said that it must guard the "confidentiality of its donors to ensure their safety" citing "threats" that had been made against "associates" of the group, "ranging from threats to kill or maim, to threats to firebomb buildings."

But on Wednesday morning, Deputy Attorney General Alexandra Gordon urged the court reverse to injunction and stay proceedings pending the state's appeal.

Gordon called the preliminary injunction an "extraordinary remedy" based on evidence that did "not rise to the type of systemic, brutal, longstanding harm against a vulnerable organization that the government is either unable or unwilling to control."

"We're nowhere close to that," Gordon said. "We have basically some anecdotal evidence of threats, mostly arising from the founders of this foundation, the Koch brothers' very public presence and very public events held by the foundation. That has nothing to do with whether this type of disclosure requirement is actually going to lead to harm."

Quinn Emanuel attorney Derek Shaffer noted in a court filing that the Kochs are not "universally popular" and argued at the hearing that the threats to Americans for Prosperity donors were real.

"We do fear harassment - retaliation from California officials themselves," Shaffer said. "The Fair Political Practices Commission singled out the Koch Brothers without evidence whatsoever and accused them and their dark-money network of being involved in violations that they were not involved in."

Gordon said the court should stay proceedings because Real has also ruled that the injunction bars any discovery that will allow Harris to identify the group's donors in preparation for next year's trial.

Circuit Judge Stephen Reinhardt said that even if the appeals court reversed Real, the judge could still bar discovery.

"If the judge doesn't think you should properly have discovery, he's not likely to be discouraged because we say there was something wrong with the preliminary injunction," Reinhardt said.

Circuit Judges Raymond Fisher and Jacqueline Nguyen sat with Reinhardt on the panel.

David Koch and his older brother Charles head Koch Industries. They are among the wealthiest people in the world, with a combined net worth of more than $75 billion.

The brothers plan to spend $900 million on the 2016 presidential campaign, according to the New York Times.

Immediately following the hearing, Harris' office argued the case Thomas More Law Center v. Kamala Harris - litigation that also challenges the public disclosure of donors.

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