Read full complaint here.
https://ifs-site.mysitebuild.com/2014/04/14/ccp-v-harris-complaint/ccp-v-harris-complaint-2/
In order to legally solicit tax-deductible contributions in California, an entity must be registered with the state’s Registry of Charitable Trusts (“Registry”).
The Registry is administered by California’s Department of Justice. Cal. Gov. Code § 12587.1 (2014).
To maintain membership in the Registry, nonprofit corporations must file annual “periodic written reports” with the Attorney General, which “include the Annual Registration Renewal Fee Report . . . as well as the Internal Revenue Service Form 990, which must be filed on an annual basis with the Registry.” 11 Code of Calif. Regs. § 301; § 306(c). In previous years, Plaintiff has filed a periodic written report including its Federal Form 990 but, pursuant to 26 U.S.C. § 6104(d)(3)(A), has redacted the names and addresses of its contributors.
Plaintiff has been a member of the Registry since 2008.
On January 9, 2014, Plaintiff filed its Annual Registration Renewal Fee Report with the Attorney General. Defendant Demands an Unredacted List of Plaintiff’s Contributors
Plaintiff received a letter from Defendant dated February 6, 2014 (“Letter”). A true and correct copy of the Letter is attached to this Complaint as Exhibit 1.
12. The Letter acknowledges Defendant’s receipt of CCP’s periodic written report, but states that “[t]he filing is incomplete because the copy of Schedule B, Schedule of Contributors, does not include the names and addresses of contributors.” (bold in original).
13. The Letter states that “[t]he Registry retains Schedule B as a confidential record for IRS Form 990 and 990-EZ filers.”
14. The Letter concludes that Plaintiff must “[w]ithin 30 days of the date of this letter . . . submit a complete copy of Schedule B, Schedule of Contributors, for the fiscal year noted above, as filed with the Internal Revenue Service.” (bold, underlining in original).
Thirty days from the date of the Letter is March 8, 2014, a Saturday.
The Letter further instructs Plaintiff to “address all correspondence to the undersigned.”
The Letter is signed simply “A.B.,” which the signature block describes as an “Office Technician, Registry of Charitable Trusts” writing on behalf of Defendant.
Under California law, “[t]he Attorney General may issue a cease and desist order whenever the Attorney General finds that any entity . . . has committed an act that would constitute a violation of . . . an order issued by the Attorney General, including, but not limited to . . . fail[ure] to file a financial report, or [filing] an incomplete financial report.” Cal. Gov. Code § 12591.1(b)(3) (2014).
After making such a finding, the Attorney General “may impose a penalty on any person or entity, not to exceed one thousand dollars ($1,000) per act or omission.” Cal. Gov. Code § 12591.1(c).
“At least five days prior to imposing that penalty,” however, “the Attorney General shall provide notice to the person or entity that committed the violation by certified mail to the address of record at the Registry of Charitable Trusts.” Id.
“Penalties shall accrue, commencing on the fifth day after notice is given, at a rate of one hundred dollars ($100) per day for each day until that person or entity corrects that violation.” Id.
“If the Attorney General assesses penalties under this section, the
Attorney General may suspend the registration of that person or entity” in the Registry. Cal. Gov. Code § 12591.1(d).
“Registration shall be automatically suspended until the fine is paid and no registration shall be renewed until the fine is paid.”
