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Cases We Are Watching

CATEGORY: Nonprofit News
CLIENT TYPE: Nonprofit
DATE: Feb 05, 2025
  • A number of affirmative action cases have been working their way through the courts since the U.S. Supreme Court’s ruling on affirmative action last summer.  The Supreme Court is currently considering whether to hear a case involving a temporary K-12 admission policy meant to diversify student bodies at three Boston schools. Earlier this month, a lawsuit was filed in Illinois about a scholarship program meant to diversify the education workforce and narrow the achievement gap. The individual named in that lawsuit is a nonminority high school senior who plans to pursue an education degree and is qualified for the scholarship program except for her race. A few months ago, a federal judge in Virginia dismissed a proposed class action lawsuit accusing a newspaper publisher of adopting diversity policies that allegedly led to five journalists’ terminations or other adverse employment actions. In that case, the journalists sued under section 1981 of the Civil Rights Act, which prohibits race discrimination in making and enforcing contracts.
  • The University of California (UC) was recently sued by a former undocumented UCLA student and UCLA lecturer, alleging that UC has the authority to hire undocumented students to fill campus jobs, but its refusal to exercise that authority results in discrimination against thousands of students enrolled at campuses across the state. The complaint alleges that the UC Regents are relying on a mistaken interpretation of the Immigration Reform and Control Act, a federal law that prohibits the hiring of undocumented immigrants. The complaint alleges that the law does not apply to state government employers, and the impact is that students cannot pursue advanced degrees because they are unable to complete the necessary teaching or other employment requirements, like working a medical residency. In their petition, the complainants are seeking relief under two theories. The first, that UC’s policy is an abuse of discretion. The second, that the policy violates the Fair Employment and Housing Act’s prohibition on immigration status discrimination.
  • Catholic Charities Bureau v. Wisconsin: Wisconsin exempts from its state unemployment tax system certain religious organizations that are “operated, supervised, controlled, or principally supported by a church or convention or association of churches” and that are also “operated primarily for religious purposes.” The Catholic Charities Bureau of the Diocese Superior, Wisconsin, a nonprofit corporation, is the social ministry arm of the Catholic Church. Catholic Charities applied for an exemption from having to pay unemployment tax to cover their employees. The Wisconsin state labor commission denied the application on grounds that their activities were “not religious per se.” The Wisconsin Supreme Court agreed finding that Catholic Charities’ activities were mostly secular and noted it “did not proselytize, did not conduct worship services, religious outreach, or religious education.” On December 13, 2024, the United States Supreme Court granted certiorari (i.e. to hear the case) to determine whether Wisconsin’s decision violates the First Amendment’s guarantee to the free exercise of religion and separation of church and state. Oral arguments are expected for spring 2025 with a decision by summer. This case is important because the decision could impact nonprofit religious organizations by demonstrating what the U.S. Supreme Court thinks about the government’s ability to define what is religious, which can have big implications from employment laws to nonprofit tax laws.
  • We are watching two cases about challenging the Johnson Amendment, which prohibits 501(c)(3) organizations from taking a position for or against candidates for public office. In March 2024, Students & Academics for Free Expression, Speech, & Political Action in Campus Educ. (SAFE SPACE) filed a petition with the United States Tax Court against the Internal Revenue Service regarding its qualification to be a 501(c)(3) nonprofit organization. The petition states that SAFE SPACE will exist for charitable and educational purposes, though it will also participate in lobbying activities and candidate endorsements, and claims those activities are crucial to its mission, and argues that the Johnson Amendment is unconstitutional. The parties have recently dismissed the case to allow the IRS more time to evaluate its application for exempt status. Similarly, in National Religious Broadcasters and Three Churches v. Commissioner, a lawsuit filed in federal court in Texas, the National Religious Broadcasters and two Baptist Churches and a conservative group, are suing the IRS arguing the Johnson Amendment prevents restricts their freedom of speech and religion. If the Johnson Amendment is overthrown on First Amendment grounds, it could radically impact the nonprofit sector and American political and civil life more broadly.

 

 

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