Judge Doubts California's Need for Koch Group Donor Names

Updated on
  • State attorney general accused by federal judge of `laziness'
  • Americans for Prosperity fears reprisals if donors publicized

A federal judge questioned why California needs to know who donates to a foundation started by billionaire brothers Charles and David Kochand accused the state attorney general of “laziness” for demanding the confidential information.

U.S. District Judge Manuel Real repeatedly interrupted the state’s lawyer during her opening statement Tuesday at a trial in Los Angeles, asking how the names of the donors to a nonprofit group could be of any help in finding out whether that group’s officers misuse the money they receive.

The Americans for Prosperity Foundation seeks a court order that it doesn’t have to disclose donor information to California Attorney General Kamala Harris. Like other nonprofit groups in the state, the foundation is required to turn over a tax form listing its biggest donors that it already provides to the Internal Revenue Service. The attorney general has a policy of keeping those names confidential.

The foundation, which advocates for conservative causes, is associated with a political network overseen by the Kochs that spent almost $400 million in 2015, part of a plan to spend $889 million in the 2016 election cycle. Various parts of the network run television ads, develop voter data files and operate phone banks.

Derek Shaffer, a lawyer for the foundation, said in his opening statement at the non-jury trial that Harris, a Democrat who’s running for the U.S. Senate, considers Americans for Prosperity a political opponent and has been using the lawsuit to pressure the group.

Shaffer said the attorney general’s reassurances about the data being kept confidential can’t be trusted because there have been disclosures in the past. Giving the state a list of who contributes to the foundation would scare away would-be supporters, according to Shaffer.

‘Become Targets’

Evidence to be presented “will leave no doubt that donors who are outed will become targets,” Shaffer told the judge.

Alexandra Robert Gordon, a lawyer for Harris, argued that that foundation’s contributors don’t have to fear losing their jobs, having their homes burned down, or becoming the target of government surveillance. She contrasted the Koch group’s concerns to past cases in which the National Association for the Advancement of Colored People and the Socialist Workers Party won court orders shielding their members’ information from local governments based on fear of reprisals.

“Americans for Prosperity is a robust, thriving organization,” she told Real.

Any alleged threats to members of the foundation are unrelated to alleged disclosures of their identity by a government agency, Robert Gordon said.

The state lawyer also said there was no evidence of harm from any information about donors to other tax-exempt organizations inadvertently outed in the past. She said a computer glitch blamed for disclosures was discovered and fixed within a week.

Real last year concluded that the state’s requirement on disclosing the donor data would “chill” free speech and issued a preliminary ruling barring California from seeking the information.

Actual Harm

A federal appeals court in December reversed the judge, saying there was no evidence of actual harm to the advocacy group since the state doesn’t reveal the information to the public.

Harris has argued that the state collects details on donors from tax-exempt charitable organizations to police and prevent charity fraud. Groups are required to provide the same information to the IRS.

On Tuesday, Real questioned the attorney general’s need for the information to carry out her job and asked why she can’t get it directly from the IRS.

Americans for Prosperity has more than 2 million members and collects more than $20 million in contributions a year, according to a Feb. 9 court filing by the attorney general. Only a “trivial” number of its donors are on a list it files with the IRS because it only needs to include those that contributed more than 2 percent of its total income, Harris’s office said.

The case is Americans for Prosperity Foundation v. Harris, 14-cv-09448, U.S. District Court, Central District of California (Los Angeles).