Supreme Court invalidates California’s donor disclosure requirement

Supreme Court invalidates California’s donor disclosure requirement

The Supreme Court on Thursday invalidated a California rule that requires charitable organizations to disclose the names of contributors in a case that could impact the future of “dark money” politics.

The opinion was 6-3 along conservative-liberal lines.

“The upshot is that California casts a dragnet for sensitive donor information from tens of thousands of charities each year, even though that information will become relevant in only a small number of cases involving filed complaints,” Chief Justice John Roberts wrote.

Campaign finance reform had expressed fear that such a ruling could eventually lead to more anonymous money — called dark money — to enter the political sphere.

The case had pitted the interest of charities to maintain the privacy of their donors against the states’ interest in policing charitable fraud.

California mandated that non-profit charities that solicit donations in the state identify their substantial donors to the California attorney general. The same information already goes to the IRS — found on the IRS Form 990. The Schedule B attachment required the organizations to report the names and addresses of their largest contributors. Failure to comply had the potential to lead to late fees and suspicion of their registration as a charitable organization.

The challenge against the state law was brought by conservative non-profits American for Prosperity Foundation (a Koch-affiliated group) and the Thomas More Law Center, who want to keep their donors’ identities secret and argued that the state had not shown a compelling reason for the law.

Justice Sonia Sotomayor, writing for the minority, suggested that the majority’s ruling could impact donor disclosures in the political sphere, allowing more anonymous money. She said the majority marks disclosure requirements with a “bull’s-eye.”

She said the court “trades precision for blunt force” and creates a “significant risk that it will topple disclosure regimes that should be constitutional.”

This story is breaking and will be updated.