California’s Donor Disclosure Requirement Ended by the Supreme Court

Nonprofits do not have to disclose the names of their wealthy contributors according to a new ruling by the Supreme Court.

The decision invalidated a California requirement that organizations who fundraise release the names of top supporters to the state’s attorney general’s office. Americans for Prosperity Foundation and the Thomas More Law Center challenged the policy out of concern that the lack of privacy would deter donors.

The court ruled 6-3 on Thursday that the law is ‘facially unconstitutional.’ The court sided with the conservative groups, saying that such disclosure requirements infringe on the First Amendment,” reported Fox News.

Under California’s regulation, known as Schedule B, top donors’ names and addresses were collected by the state. This practice was regarded by some officials as a necessary way for preventing fraud. 

In filings with the Supreme Court, AFPF argued its most substantial donors face potential harassment and threats if their identities are publicly disclosed and said California has violated a pledge to keep the IRS forms confidential. While federal law forbids the IRS from disclosing the information on the form, AFPF told the Supreme Court in filings that it discovered the attorney general’s office had publicly posted nearly 1,800 forms online,” CBS News documented.

In her dissent, Justice Sonya Sotomayor said “Today’s analysis marks reporting and disclosure requirements with a bull’s-eye. Regulated entities who wish to avoid their obligations can do so by vaguely waving toward First Amendment ‘privacy concerns.’”

Ultimately, though, these concerns took precedence over the state’s claims.

“We are left to conclude that the attorney general’s disclosure requirement imposes a widespread burden on donors’ associational rights. And this burden cannot be justified on the ground that the regime is narrowly tailored to investigating charitable wrongdoing, or that the state’s interest in administrative convenience is sufficiently important,” Chief Justice John Roberts wrote in an opinion. 

HuffPost noted that “the nonprofits had drawn strong support from groups across the political spectrum, including the American Civil Liberties Union and NAACP Legal Defense and Educational Fund.” The website also referred to these affluent supporters as “dark money donors.”

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