New from the Institute for Free Speech
IFS Praises IRS Reforms to Protect Donor Information
The Institute for Free Speech, America’s largest nonprofit defending First Amendment political speech rights, released the following statement praising Treasury Secretary Steven Mnuchin’s decision to modify IRS regulations to no longer require the names and addresses of donors on Schedule B of the tax forms filed by certain groups organized under Section 501(c) of the tax code. The new policy does not affect the filing requirement for 501(c)(3) organizations:
“We applaud the Treasury Department and Secretary Mnuchin for its common-sense move to protect the privacy of Americans who give to nonprofits,” said IFS President David Keating. “It has become increasingly clear that the mass collection of this highly personal information is not necessary to enforce tax laws or conduct investigations. Moreover, it can be easily abused to suppress First Amendment rights. Secretary Mnuchin has made a wise decision, and now Congress must take the next step. Federal law still mandates the IRS collect Schedule B information from 501(c)(3) charitable organizations. Repealing that requirement will provide even greater protection to Americans’ privacy and freedom of association.”
The Institute for Free Speech has previously written in support of legislation by Congressman Peter Roskam, H.R. 4916, that would, in most instances, bar the IRS from collecting donor information from any nonprofit organization. You can view the Institute’s letter to Congress here.
IRS
Wall Street Journal: U.S. Treasury Restricts Donor Disclosure Requirement for Some Nonprofit Groups
By Richard Rubin
Until now, nonprofit groups, including charities and trade associations, had to list contributors who give at least $5,000 on what is known as Schedule B. The IRS received the complete version, and the groups publicly released redacted forms without identifying information about donors.
Under the change announced late Monday, charities and political groups still must provide the names and addresses of donors, but other nonprofits don’t. Organizations that no longer need to provide the information include social welfare organizations, which can engage in politics and don’t have to disclose their donors to the Federal Election Commission…
“Americans shouldn’t be required to send the IRS information that it doesn’t need to effectively enforce our tax laws, and the IRS simply does not need tax returns with donor names and addresses to do its job in this area,” Treasury Secretary Steven Mnuchin said in a statement. “This change will in no way limit transparency. The same information about tax-exempt organizations that was previously available to the public will continue to be available, while private taxpayer information will be better protected.” …
“The IRS’s decision is a move in the right direction to end activist regulators’ culture of intimidation to silence political speech,” said Senate Majority Leader Mitch McConnell (R., Ky.) “More and more states were using these documents to chill political discourse, rather than encourage it.”
Office of U.S. Senate Majority Leader Mitch McConnell: IRS Announcement A Victory For Free Speech
U.S. Senate Majority Leader Mitch McConnell (R-KY) delivered the following remarks today on the Senate floor regarding the announcement from the Internal Revenue Service (IRS) that it will no longer require donor lists from certain nonprofit organizations:
“Last night, the Internal Revenue Service made an important announcement. It’s particularly welcome news to those of us who are intently focused on defending the First Amendment, for those of us who raised concerns during the last administration about activist regulators punishing free speech and free association. And it’s a straightforward, commonsense policy decision.
“The Internal Revenue Service is cutting back on the amount of nonpublic information it collects and stockpiles about Americans who donate to nonprofit causes. The IRS will no longer pointlessly demand private contributor lists from whole categories of tax-exempt organizations. I say ‘pointlessly,’ because the identity of non-profit donors serve no compelling purpose under sections 501(c)(4) and 501(c)(6) of our tax code.
“Contributions to these organizations are not tax deductible, so the IRS does not need these data for accounting purposes. And these organizations are not required to release that information under the public inspection and availability requirements. Let me repeat that: The identity of donors to these organizations is not necessary for accounting, and is not required for public inspection by the Internal Revenue Code.
“It raises the question: If the IRS isn’t permitted to do anything with this set of Americans’ private information, why collect it in the first place? Unfortunately, we know exactly what happens when the government stockpiles private data about the donations through which Americans participate in the public discourse . . .
Politico: Treasury defends move to halt nonprofit disclosures amid Wyden threat
By Aaron Lorenzo
The decision immediately sparked a backlash, with Sen. Ron Wyden (D-Ore.) saying Tuesday that he’ll oppose the nomination of a new IRS commissioner over the move.
Wyden, the Finance Committee’s top-ranking Democrat, charged that President Donald Trump and Treasury Secretary Steven Mnuchin have made it easier for anonymous foreign donors to funnel dark money into nonprofits.
“It’s the latest attempt by Secretary Mnuchin and Donald Trump to eliminate transparency and keep officials and lawmakers from following the money,” Wyden said in a statement. “That’s why I’ll be opposing Charles Rettig, nominee to be IRS commissioner, unless Mr. Rettig commits to restoring this critical disclosure requirement.”
Rettig is scheduled for a vote by the Finance Committee on Thursday…
The news was well-received among conservative groups and congressional Republicans, who have said Schedule B has been illegally leveraged for political gain by infringing on First Amendment rights. Rep. Peter Roskam (R-Ill.) said the IRS simply doesn’t need such taxpayer information.
“This move by the Treasury Department protects the free speech of private citizens and eliminates the use of an unnecessary form that does nothing to increase transparency,” Roskam said in a statement.
Wall Street Journal: An IRS Advance for Speech Privacy
By Editorial Board
Presidents swear an oath to “protect and defend the Constitution,” and that includes guarding against restrictions on political speech. So congratulations to Treasury Secretary Steven Mnuchin and Acting IRS Commissioner David Kautter for advancing that cause on the controversial issue of donor privacy…
Donor names are supposed to remain private, but the government has inadvertently revealed donor lists. IRS employees also used donor-information demands as part of their harassment of Tea Party organizations during the Obama Administration. State Attorneys General have even sought to require nonprofits to release Schedule B details to state regulators, with a goal of requiring public disclosure that could tee up donors for political harassment-a threat to free speech. The new IRS policy means states won’t be able to exploit this donor information as easily.
Congress required the IRS to collect 501(c)(3) information in the 1960s, but in 1971 the Nixon Administration extended the reporting requirement to other nonprofits. The Trump Treasury is simply rolling back that rule, and rightly so given that the IRS is not a campaign-finance regulator. The IRS’s job is to collect revenue for the government…
Under current law the IRS Commissioner can make this procedural change without a formal rule-making, though a future Administration could reverse it. Republicans should take a cue and pass legislation to bar the IRS from such donor-detail collection while they still control the House and Senate.
Supreme Court
Observer: Brett Kavanaugh’s Spotty First Amendment Record Could Be a Problem for Tech and Media
By John Bonazzo
It’s been a week since President Donald Trump nominated Judge Brett Kavanaugh to the Supreme Court, and much of Kavanaugh’s legal history as a jurist has been analyzed in that time.
But one less discussed aspect of Kavanaugh’s history on the bench is his take on the First Amendment and other issues important to journalists.
The Reporters’ Committee for Freedom of the Press is looking to change that. Today, the nonprofit released a report detailing Kavanaugh’s rulings in First Amendment cases.
Since Kavanaugh served on the Washington, D.C. Circuit Court, he often dealt with press freedom issues like libel, national security concerns and access to government information.
Here’s where Kavanaugh stands on key issues…
ACLU: Dear Brett Kavanaugh, Justices Do Make Law
By Arthur Eisenberg
In writing opinions that will serve as precedent and in relying on precedent as a source of law, the Supreme Court functions as a common law court. The justices of the court who write these opinions are unquestionably engaged in making law, not merely in applying law.
By way of example, the entire body of law regarding freedom of expression has been created by the Supreme Court. The First Amendment provision pertaining to freedom of speech and press reads: “Congress shall make no law abridging freedom of speech or of the press ….” The text seems clear. But reading the text alone fails to capture the scope of the provision. We know, because the Supreme Court has told us, that “no law” does not really mean “no law.” And the proscriptions of the First Amendment are not limited to “Congress.” They apply, as well, to the executive branch and to state and local governments. Moreover, the First Amendment extends its protective reach beyond “speech” and “press” as it also guards against government censorship of movies, artwork, the internet, and other forms of expression.
These deviations from the text of the First Amendment and the expansion of free expression beyond its narrow words were accomplished entirely by judicial lawmaking. The First Amendment doctrine against “prior restraint” that was invoked in the Pentagon Papers case was a creature of judicial lawmaking. So too were the principles of “symbolic speech” that allowed a student to wear a black armband to class in protest of the Vietnam War; and the general prohibition of “vague” enactments that secured the free speech rights of civil rights marchers in Birmingham, Alabama; and the presumption against “content-discrimination” that protected the Brooklyn Museum from the censorship efforts of former Mayor Giuliani. In fashioning each of these legal doctrines the court was making law.
The Courts
Washington Post: Maria Butina, Russian gun-rights advocate who sought to build ties with NRA, charged with acting as a covert Russian agent
By Rosalind S. Helderman, Tom Jackman and Devlin Barrett
A Russian woman with ties to a senior Russian government official was charged in Washington on Monday with conspiracy to act as an agent of the Russian Federation, including by building ties to the leadership of the National Rifle Association and other conservative political organizations.
Maria Butina, 29, who recently received a graduate degree from American University, was arrested Sunday in the District and made her first appearance in U.S. District Court before Magistrate Judge Deborah A. Robinson, where she was ordered held without bond.
Butina is accused of trying to cultivate relationships with American politicians to establish “back channel” lines of communication and seeking to infiltrate U.S. political groups, including an unnamed “gun rights organization,” to advance Russia’s agenda. Descriptions in court papers match published reports about Butina’s interactions with the NRA.
The case, which is not part of the special counsel investigation into Russian interference, lays out the strongest allegations to date of American involvement in Russia’s influence operations…
The charges against Butina were announced days after the Justice Department unveiled an indictment against 12 Russian intelligence officers for allegedly conspiring to hack Democrats in 2016 and just hours after Trump cast doubt on Russia’s involvement in an extraordinary joint news conference with President Vladimir Putin.
By Ken White
United States District Court Judge John F. Walter, sitting in federal court in Los Angeles, has issued an extraordinary, dangerous, and illegitimate order to the Los Angeles Times directing it to remove factual information from a newspaper article discussing a federal criminal case. Judge Walter’s order is lawless…
Judge Walter also ordered the Times to appear in Court this Wednesday to argue whether the temporary order should be made into a permanent injunction.
In other words, based on an emergency request from the defendant, with no prior opportunity to be heard, a federal judge ordered a major newspaper (1) not to write about the details of a federal plea agreement it had obtained lawfully, (2) not to write anything that “relies on, or is derived in any way” from the plea agreement, an incredibly broad and vague term that is extraordinarily chilling to speech about the case, (3) to take down any story it’s already published, and (4) told the paper they can see the order, but not the application stating the legal and factual grounds for the order…
This is not a close call. Judge Walter’s order is not plausibly lawful. It is patently unconstitutional, and the sort of order that is only issued when a judge deliberately defies First Amendment law or is asleep at the switch. This is utterly unacceptable. The Los Angeles Times will be challenging the order, and I expect them to win, and look forward to all of the briefing – and the original article – becoming available.
Washington Post: Indicted Russian firm says it was backing free political speech, not disrupting 2016 election
By Tom Jackman
Concord’s lawyers argued Monday in a motion to dismiss the case that the company hadn’t committed any crime. Defense attorneys Eric A. Dubelier and Katherine J. Seikaly noted that American case law and the Justice Department’s own manual on prosecuting election crimes state there must be “proof that the defendant was aware that his or her conduct was generally unlawful.” Concord argued that there is no proof that it knew of laws requiring foreign agents to file reports with the Justice Department or the Federal Election Commission.
“Only ‘foreign agents’ or ‘foreign principals’ are required to register under the Foreign Agents Registration Act,” the defense team noted, “and the indictment does not allege that Concord fits either definition.”
Dubelier and Seikaly also claimed that no foreign corporation has ever “been charged criminally for allegedly funding the political speech of individual on social media, at rallies, or in advertisements during a U.S. presidential election campaign.” The defense also argued that the fraud charge against Concord “has never been used . . . where political speech, as opposed to political contributions, is the target of the indictment. In short, the Special Counsel found a set of alleged facts for which there is no crime.”
Concord further argued that “there is no federal law prohibiting ‘interference’ in a U.S. election.” The indictment alleges Russian operatives used fake or stolen American identities…
“There is no law or regulation,” Concord’s lawyers wrote, “requiring that any such speech be accurate or truthful or that any U.S. or foreign person truthfully or accurately identify herself or himself when engaging in such speech – when it comes to political speech, one is free to pretend to be whomever he or she wants to be and to say whatever he or she wants to say.”
FEC
Courthouse News Service: Campaign Watchdog Wants Investigation of NRA Senate Donations
By Brad Kutner
A campaign watchdog group is pressing the Federal Election Commission to investigate how the National Rifle Association spent money in relation to four past senatorial campaigns.
In a complaint filed with the FEC Monday morning, the Campaign Legal Center alleged the NRA used a shell company to funnel money into campaign ads while another straw company took in money and acted as a “common vendor” for the four campaigns.
The Center claims the scheme involved two separate NRA entities: the National Rifle Association of America Political Victory Fund and the National Rifle Association of America Institute for Legislative.
According to the complaint, these entities contracted with the consulting firm OnMessage, Inc. during the 2010 and 2012 election cycles, and then, in 2013, OnMessage formed another consulting company, Starboard Strategic Inc.
During the next election cycle, the complaint says, both NRA entities worked with Starboard Strategic Inc. to support three senatorial candidates, Thom Tillis, R-N.C., Tom Cotton, R. Ark., and Cory Gardner, R-Colo. Meanwhile, the Center says, all three candidates’ campaign committees were paying for the services of OnMessage…
“There is substantial evidence that the NRA funneled millions through a shell corporation to unlawfully coordinate with candidates it was backing,” said Brendan Fischer, director of the Campaign Legal Center’s Federal Reform project.
“According to the Supreme Court, groups like the NRA can only make unlimited expenditures if they are independent of the candidates they support, and it falls to the FEC to enforce the laws that preserve that independence and prevent corruption,” he said.
The States
Idaho Press-Tribune: Legislative panel to consider campaign finance reforms
By Betsy Z. Russell
A joint legislative interim committee will meet Tuesday to consider campaign finance reform proposals, after a major bill the panel endorsed unanimously last year went nowhere in this year’s legislative session.
The sweeping bill required more frequent and more detailed campaign finance reporting in Idaho elections, extended reporting requirements to local elections, and required entities doing independent campaign expenditures and out-of-state entities donating large sums to Idaho PACs or candidates to identify the source of the money.
The proposal, which is backed by Idaho Secretary of State Lawerence Denney, included centralizing all campaign finance reports on a single, searchable database managed by the Secretary of State’s office, including those from local elections. Those running campaigns at any level of government would be subject to reporting requirements, but only once they’ve raised $500. It also expanded the reporting requirements to include local recall and special elections.
Sen. Patti Anne Lodge, R-Huston, who co-chairs the interim committee, said the bill, which wasn’t scheduled to take effect until July 1, 2019, just needed refining.
