California AG’s Bid to Get|Koch Donor List Shot Down

     
     LOS ANGELES (CN) – A federal judge has ruled a requirement that a Koch brothers’ charitable foundation release tax information to the California attorney general that includes donor information is unconstitutional.
     In a 12-page ruling, U.S. District Judge Manuel Real said that while the disclosure requirement was not “facially invalid,” it is “unconstitutional as applied to Americans for Prosperity Foundation, especially in light of the requirement’s burdens on the foundation’s First Amendment rights.”
     The foundation, a conservative advocate of free-market economic policies, sued California Attorney General Kamala Harris in 2014 arguing that it should be allowed to keep donor names secret.
     Backed by the billionaire Koch brothers Charles and David, the group said in its complaint that the Schedule B federal tax form that it filed with the IRS listed 990 donor names and addresses.
     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 told the foundation it could not register as a charity with the state without submitting the tax form.
     In a statement, Harris spokeswoman Kristin Ford noted that the requirement had been in place for ten years, well before Harris took office in 2011.
     “We are disappointed in Judge Real’s ruling and intend to appeal to the Ninth Circuit Court of Appeals. The filing of the Schedule B is a long-standing requirement that has helped attorneys general for more than a decade to protect taxpayers against fraud,” Ford wrote in an email.
     During a bench trial, the plaintiffs put several witnesses on the stand who said they had feared for their lives because of their support for the foundation. Prominent North Carolina activist and politician Art Pope was among the witnesses who said they had received death threats.
     Harris meanwhile argued that the forms were useful in uncovering charity fraud and that provisions are in place to protect disclosure of donor information.
     In his ruling, Real said there is an actual burden on the foundation’s First Amendment Rights, citing those threats and others presented at trial.
     “The court can keep listing all the examples of threats and harassment presented at trial; however, in light of these threats, protests, boycotts, reprisals, and harassment directed at those individuals publicly associated with the foundation, the court finds that foundation supporters have been subjected to abuses that warrant relief on an as-applied challenge,” Real wrote.
     The court, therefore, barred California from collecting the Schedule B tax forms.
     The foundation’s attorney Derek Shaffer called the ruling an “important victory.”
     “The foundation is gratified that Judge Real has vindicated its First Amendment right to resist the California Attorney General’s demand that all charities disclose the names and addresses of all of their major donors nationwide,” Shaffer, an attorney Quinn Emanuel Urquhart & Sullivan, said. “We hope this important victory will enable Americans, even in the face of governmental overreach, to retain their freedom, privacy and security as they support charities of their choosing.”
     The Kochs are among the wealthiest people in the world, with a combined net worth of more than $75 billion.

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