U.S. News

U.S. Supreme Court takes up dispute over California nonprofit donor disclosure requirement

WASHINGTON (Reuters) - The U.S. Supreme Court on Friday agreed to hear a challenge by two conservative groups to a California requirement that tax-exempt charities disclose to the state the identity of their top finiancial donors.

The justices will take up the appeal of a lower court ruling that said California’s attorney general could require the two nonprofit organizations, Americans for Prosperity and the Thomas More Law Center, to furnish him with donor details.

The groups argued that the demand infringed upon their freedom of speech and association under the U.S. Constitution’s First Amendment. The Thomas More Law Center is a conservative Catholic legal group. Americans for Prosperity is a political advocacy organization founded by billionaire conservative Charles Koch and his late brother David.

California, the most populous U.S. state, said the information is required from such nonprofits as part of the attorney general’s duty to prevent charitable fraud.

The state requires that charities provide a copy of the tax form they file with the U.S. Internal Revenue Service that lists major donors who contribute large amounts. Larger groups have to disclose donors who contribute $200,000 or more in any year. That information is not posted online and is kept confidential.

California’s attorney general, Democrat Xavier Becerra, is defending the practice of requiring the donor information, which dates back to 2010, before he took office. President-elect Joe Biden has chosen Becerra as his nominee as secretary of health and human services.

A district court judge in California ruled in favor of the groups. The San Francisco-based 9th U.S. Circuit Court of Appeals in 2018 reversed that decision, prompting the groups to appeal to the Supreme Court.

President Donald Trump’s administration had urged the high court to hear the case even as it defended the federal government’s right to request the same information.

Another group that challenged the California requirement, the conservative Institute for Free Speech, also has an appeal pending at the high court.

Reporting by Lawrence Hurley; Editing by Will Dunham and Grant McCool