California’s attack on donor privacy draws supreme scrutiny

Do you have the right to privately support charities and causes you believe in? And what standard applies when the government seeks to discover otherwise-anonymous donors' identities from nonprofit organizations? On Jan. 8, the U.S. Supreme Court granted certiorari in Americans for Prosperity Foundation v. Becerra to clarify the answers to those questions.

The 9th U.S. Circuit Court of Appeals previously signed off on California's donor disclosure law, which required all nonprofit organizations to hand over an unredacted IRS Form 990 Schedule B, which contains the name and address of all people who contribute over $5,000 in a calendar year. This was despite the fact that California put forward only general investigatory interests in the information, had failed to keep the forms confidential, and where the plaintiffs involved had shown a risk of harassment if their donors' identities were disclosed to the public.

On any number of counts, the 9th Circuit should be reversed. The Supreme Court has long recognized the substantial First Amendment injury caused by the loss of privacy when the government stops individuals from associating freely, most notably in NAACP v. Alabama, where the court required a "compelling justification" before the government may require disclosure of an organization's member lists.

It is obvious that many individuals will be less likely to contribute to organizations they support if their identity will be freely known. That's why even the disclosure of donor identity to government can create a significant First Amendment injury. To be sure, the government can release those identities to third parties that engage in targeted harassment, but the government can also engage in its own nefarious behavior: The IRS targeted certain conservative groups for additional tax scrutiny for years based on the viewpoints of the organizations. And there is little guarantee that the government will carefully protect donor identities in the future -- the injury of disclosure happens now regardless of whether it is to government or third parties because anonymity lost is lost forever. Future elections may change who controls information collected now, and its abuse is in the future is no less harmful than any abuse now.

The 9th Circuit credited California's purported interest in "investigat[ing] charitable fraud." But the Supreme Court has held that general investigatory interests are insufficient to justify deeper constitutional intrusions, such as in Los Angeles v. Patel.

Worse still, the 9th Circuit effectively removed any narrow tailoring requirement for donor disclosure laws. While the Supreme Court precedent for exacting scrutiny is complicated, it has only relaxed the narrow tailoring requirement in the election context -- effectively holding that disclosure is sometimes the most limited means to protect against election fraud.

Outside of the election context, donors should rightly have a strong expectation that their anonymity should be maintained. After all, freedom of association has long been understood to protect the identity of otherwise anonymous donors. The history of anonymous association in America stretches back to our nation's founding, when multiple founding fathers labored together under the pseudonym "Publius" in the Federalist Papers to support the Constitution's adoption.

The reasons individuals desire anonymity are numerous. For example, the gospel of Matthew suggests that charity should be done in secret. In Judaism, "tzedakah" refers to a potential obligation to engage in charity without revealing the giver's identity. In Islam, "sadaqah" urges voluntary giving that is made "in the name of God alone." And the Bhagavad Gita also establishes the highest level of giving as that made "without consideration of anything in return."

But even without such concerns, the reality is that the public disclosure of donations to nonprofit organizations can lead to public and private reprisals. The threats range from the loss of employment -- for example, one restaurant manager in Los Angeles was forced to resign over a $100 donation to a group supporting Proposition 8, the 2008 ballot measure banning same-sex marriage -- to increased government scrutiny, like that to which the IRS subjected groups affiliated with the "Tea Party" movement.

Given these potential threats, California's attack on donor privacy has the potential to chill charitable work nationwide. After all, California donations represented 13.7% of charitable contributions in 2013, or almost $27 billion. Many of those donors, faced with the potential disclosure of their identity, may choose to cease donations to nonprofits.

Nonprofits -- such as Pacific Legal Foundation -- accomplish tremendous good across the country because of their ability to obtain donations from individuals who believe in their cause -- even where any one individual might be too afraid to support a particular position. We hope that the Supreme Court will recognize the importance of that collective anonymity. 

Jeremy Talcott is an attorney at Pacific Legal Foundation, which litigates nationwide to achieve the Constitution's guarantee of individual liberty.