[EL] Court Dismisses CREW lawsuit against IRS on c4 regulations

Tue Mar 4 06:03:23 PST 2014

Regarding:

Haven't seen anything on the widely-expected dismissal of that case for  
lack of standing to sue: 
CREW v. Dept of Treasury, No. 13-732, 2014 WL 772898 (D.C.D.C.,  Feb. 27, 
2014). 

This is SOP. CREWS's unfounded and scurrilous accusations get wide coverage 
 and the inevitable dismissal gets none.  Their allegations are almost  
always found to be bogus (maybe always, but I am being generous) but they  get 
wide coverage anyway. 

When will the media stop playing CREWS's smear game?  Jim  Bopp

In a message dated 3/3/2014 12:47:26 P.M. Eastern Standard Time,  
BZall at aol.com writes:

Much hoopla about CREW's press release announcing its suit against the  IRS 
for failing to agree with CREW on the regulations on 501(c)(4) "political"  
activity. http://electionlawblog.org/?p=50810.  

Haven't seen anything on the widely-expected dismissal of that case for  
lack of standing to sue: 
CREW v. Dept of Treasury, No. 13-732, 2014 WL 772898 (D.C.D.C., Feb.  27, 
2014). 

Not surprising. Standard three-part standing analysis: even assuming  
everything factual in the Complaint is true (but not legal conclusions couched  
as factual assertions):

1) CREW has no "injury in fact" because it can't identify any law that  
requires CREW to be provided the information about c4 donors that it seeks in  
its rulemaking petition. Slip Op. at *4-5. Not even Section 527, which  CREW 
contends applies. Nothing requires organizations denied c4 status to  
become 527 political organizations, as CREW suggests; instead, the Court  notes, 
an organization could become a taxable organization which could engage  in 
unlimited political activity without disclosing information; file under  
another section of the IRC (like 501(c)(6) associations or (c)(5) unions)  that 
doesn't require disclosure of donors; or cease speaking. Thus, the Court  
said that CREW's theory is speculative (which it pretty obviously is) and  
didn't support standing. That should have ended the inquiry, since CREW could  
not show standing under any theory, but the Court went on to throw out 
CREW's  other two justifications.

2) CREW alleged injury has no causal connection to the defendant IRS's  
actions. (This is a "but for" test; "but for" the IRS's failure to issue  
CREW-friendly regulations, CREW would get the info.) Like above, CREW thought  
that c4s would be forced tor reveal donor information; the Court disagreed.  
Standing can't be shown by a claim that is based on some third-party's  
independent actions (not just the organizations, but also the donors). CREW is  
just speculating, with "layers of assumption," Slip Op. at *5, and that  
doesn't support the jurisdiction of a reviewing Court. 

3) CREW's claim has no "redressability." If it wins, it still likely  
wouldn't get the donor info it wants. Even its pre-suit petition for  rulemaking 
wouldn't show that it was "likely" to get the relief it seeks.  Again, it's 
the actions of independent third parties that doom CREW's claim.  Even if, 
as CREW claims, it is a "near certainty" that the IRS will change the  
regulations as CREW wants (and that claim plays right into the hands of  another 
lawsuit against the IRS claiming that CREW and others improperly  influenced 
the pending IRS rulemaking process in violation of several  administrative 
procedure laws - Cause of Action v. IRS, 
http://electionlawblog.org/?p=58554),  the organizations and the donors wouldn't necessarily give CREW the info 
it  claims. Slip Op. at *7. 

Barnaby Zall 
Of Counsel 
Weinberg, Jacobs & Tolani,  LLP 
10411 Motor City Drive, Suite 500
Bethesda, MD  20817
301-231-6943 (direct dial) 
bzall at aol.com  
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