New Court Filing Seeks to Defend Charitable Giving Rights

The Council on Foundations and Independent Sector filed an amicus brief this week to American Alliance for Equal Rights v. Hispanic Scholarship Fund, in the U.S. District Court for the District of Columbia. HSF, a 501(c)(3) nonprofit organization, is a large nonprofit organization supporting Hispanic American higher education. The plaintiff asks the Court to hold that anti-discrimination laws prohibit HSF from making scholarships to Hispanic American students.

The brief filed by these two organizations defends the right of charitable organizations to make lawful charitable gifts that advance their missions, including scholarships and other educational awards. It argues that the lawsuit at issue is seeking to extend a Reconstruction-era civil rights statute governing commercial contracts into an area it was never intended to regulate charitable generosity. It further affirms a principle long recognized by the courts: philanthropic giving, including making grants that further an organization’s specific mission, is a form of expressive conduct protected by the First Amendment.

If accepted, this theory would have serious consequences, exposing a wide range of philanthropic activity—from scholarships and disaster relief to faith-based aid—to legal uncertainty while potentially chilling giving, limiting nonprofits’ ability to respond to community needs, and weakening a charitable sector that Americans rely on every day.

“Charitable foundations are independent organizations free to direct their generosity in ways that reflect their missions, values, and purposes. Such generosity is central to strong communities and a vibrant civil society. It is also protected by the First Amendment as a form of speech.” said Kathleen Enright, president and CEO of the Council on Foundations. “Scholarships expand opportunity and make education accessible to students who might otherwise be left behind, which is the very purpose of the charitable sector. The freedom to support these programs— and a diversity of other causes — is a constitutionally protected right, one that is critical to the health of American society.”

“The freedom to give in accordance with one’s values is essential to the very concept of charity. When Americans give to a cause they believe in, they do it out of the goodness of their hearts and their commitment to a common mission, without any expectation of compensation or economic return. That the plaintiffs propose turning a 160-year-old civil rights statute on its head to undermine this critical scholarship program makes clear what this lawsuit is really about: accomplishing a political objective by any means necessary,” said Independent Sector President and CEO Dr. Akilah Watkins. “Reducing charitable gifts, including scholarships, to a mere business contract sends the exact wrong message about the importance of American generosity at a moment when our communities are in greatest need of financial support.”

The Council on Foundations and Independent Sector, on behalf of the charitable sector therefore have a strong interest in preserving the long-standing legal distinction between charitable gifts, which are given freely and without the expectation of the return of goods or services, and contracts.

The brief also underscores that a charitable organization’s choice about where to direct its resources—and where not to—is an expression of its values, consistently recognized by courts as expressive conduct protected by the First Amendment.

The full Amicus can be found here (opens as a pdf).

Source: Council on Foundations

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