Justia Non-Profit Corporations Opinion Summaries

Plaintiff, a Virginia non-profit corporation organized under section 527 of the Internal Revenue Code, commenced this action against the Commission and the Department of Justice, contending that it was "chilled" from posting information about then-Senator Obama because of the vagueness of a Commission regulation and a Commission policy relating to whether plaintiff had to make disclosures or was a "political committee." Plaintiff asserted that it was not subject to regulation but feared the Commission could take steps to regulate it because of the vagueness of 11 C.F.R. 100.22(b) and the policy of the Commission to determine whether an organization was a political action committee by applying the "major purpose" test on a case-by-case basis. Plaintiff alleged that the regulation and policy were unconstitutionally broad and vague, both facially and as applied to it, in violation of the First and Fifth Amendments. The court applied the "exacting scrutiny" standard applicable to disclosure provisions and affirmed the district court's finding that both the regulation and the policy were constitutional. View "The Real Truth About Abortion, Inc. v. Federal Election Commission" on Justia Law

In 1995, two non-profit hospitals consolidated to form Pinnacle. Pinnacle subsequently submitted a Medicare reimbursement claim for the losses the hospitals had incurred through the sale of their depreciable assets in the consolidation. The Administrator denied Pinnacle's claim, and that order became the final decision of the Secretary. On Pinnacle's Administrative Procedure Act (APA), 42 U.S.C. 12101 et seq., challenge, the district court upheld the Secretary's decision in full. Because the Secretary's interpretation of the relevant Medicare regulations was not plainly erroneous or inconsistent with the regulation, the court concluded that the Secretary reasonably applied the bona fide sale requirement to a reimbursement request from a participant in a "statutory merger." The court also held that the Secretary's finding that the bona fide sale requirement applied to consolidations involving non-profit Medicare providers, like Pinnacle, was not plainly erroneous or inconsistent with the regulation. Finally, substantial evidence supported the Secretary's finding that Pinnacle did not satisfy the bona fide sale requirement. Accordingly, the court affirmed the district court's judgment. View "Pinnacle Health Hospitals v. Sebelius" on Justia Law

Appellant Mesivtah Eitz Chaim of Bobov, Inc., a not-for-profit religious entity related to the Bobov Orthodox Jewish community in Brooklyn, appealed a Commonwealth Court ruling, asking that the Supreme Court find it is an "institution of a purely public charity" under Article VIII, sec. 2(a)(v) of the Pennsylvania Constitution, and entitled to exemption from real estate taxes. Appellant operated a summer camp in Pike County, Pennsylvania. Pike County denied Appellant's exemption request, finding that occasional use of Appellant's recreational and dining facilities by Pike County residents was insufficient to prove Appellant was a purely public charity. The Court allowed this appeal to determine if it must defer to the General Assembly's statutory definition of that term. Upon review, the Supreme Court affirmed, holding its prior jurisprudence set the constitutional minimum for exemption from taxes; the legislation may codify what was intended to be exempted, but it cannot lessen the constitutional minimums by broadening the definition of "purely public charity" in the statute. View "Mesivtah Eitz Chaim of Bobov, Inc. v. Pike Co. Bd. of Assessment Appeals" on Justia Law

This case addressed the effect of a pooled special-needs trust created by an over-65-year-old beneficiary on his medicaid benefits. The Center for Special Needs Trust Administration appealed a summary judgment in favor of the North Dakota Department of Human Services. Invoking 42 U.S.C. 1983 and the Constitution's Supremacy Clause, the Center alleged that North Dakota's demand for reimbursement and its state regulations violated a paragraph of the Medicaid Act, 42 U.S.C. 1396p(d)(4)(C). The court held that the district court properly determined that section 1396p(d)(4)(C) afforded the Center a right of action under section 1983; that North Dakota did not waive its claim to recover for reimbursements and should not be estopped from making that claim; that the Center's claim was without merit; and that preemption did not apply. View "Center for Special Needs, etc. v. Olson, etc." on Justia Law

The district court ordered the Governor of the State of New York and various state commissioners and agencies to make certain modifications to the State's mental health system to ensure compliance with 28 C.F.R. 35.130(d) - the so-called "integration mandate" of Title II of the Americans with Disabilities Act, 42 U.S.C. 12132, and Section 504 of the Rehabilitation Act, 29 U.S.C. 794. The court held that DAI, a nonprofit organization contracted to provide services to New York's Protection and Advocacy System under the Protection and Advocacy for Individuals with Mental Illness Act, 42 U.S.C. 10801 et seq., lacked standing under Article III to bring the claim. The court also held that the intervention of the United States after the liability phase of the litigation had concluded was insufficient to cure the jurisdictional defect created by DAI's lack of standing. Therefore, the court vacated the judgment and remedial order and dismissed for want of jurisdiction. View "Disability Advocates, Inc. v. New York Coalition for Quality Assisted Living, Inc, et al." on Justia Law

Plaintiff Roland Davis had been a resident of the Devereux New Jersey Center (operated by Defendant Devereux Foundation) since shortly before his twelfth birthday. Plaintiff was diagnosed with autism, mental retardation, pervasive developmental disorder and attention deficit hyperactivity disorder, and had a history of combative and aggressive behavior. Plaintiff's mother (as his guardian) filed a complaint alleging breach of a "non-delegable duty" to protect Plaintiff from harm, negligent care and supervision, and vicarious liability after a counselor assaulted Plaintiff. The trial court granted Devereux's motion for summary judgment, finding that to the extent claims were for negligence, they were barred by the Charitable Immunity Act (CIA). The court further concluded that New Jersey law does not compel imposing a "non-delegable duty" upon Devereux. The Appellate Division affirmed in part, also finding no "non-delegable duty," and reversed in part, holding that a reasonable jury could find that the counselor acted in part within the scope of her employment. The issues on appeal to the Supreme Court were: (1) whether to impose upon an institution that cares for developmentally disabled residents a "non-delegable duty" to protect them from harm caused by employees' intentional acts; and (2) whether the employee in this case could be found to have acted within the scope of her employment when she criminally assaulted the resident, thereby subjecting the non-profit facility to liability pursuant to "respondeat superior." The Court reaffirmed the duty of due care imposed upon caregivers with in loco parentis responsibilities to persons with developmental disabilities. However, applying the analysis set forth and developed by prior opinions, the parties' relationship, the nature of the risk, the opportunity and ability to exercise care, and public policy, the Court concluded the circumstances of this case did not justify imposing on caregivers a "non-delegable duty" to protect residents from harm caused by employees' intentional acts. Furthermore, the Court held that no rational factfinder could find that the Devereux counselor's criminal assault on Plaintiff was conducted within the scope of her employment. View "Davis v. Devereux Foundation" on Justia Law

Ocean Pines Association, a non-stock corporation, oversees a subdivision of more than thirty-five hundred acres in Berlin, Maryland. The Association was exempt from federal income taxation as an organization "not organized for profit but operated exclusively for the promotion of social welfare" pursuant to 26 U.S.C. 501(c)(4)(A). The Tax Court subsequently determined that the net income from two parking lots and a beach club owned by a tax-exempt association constituted "unrelated business taxable income." The association appealed. Because the income derived from the parking lots and beach club was not "substantially related" to the association's tax-exempt purpose, the court affirmed. View "Ocean Pines Assoc. v. Commissioner of IRS" on Justia Law

Appellees, three Nebraska non-profit organizations and a resident taxpayer, brought an action against the Nebraska Liquor Control Commission and its director, seeking a declaration that the Commissioner's regulations were illegal and void because the Commission had exceeded its authority under the Nebraska Liquor Control Act by classifying flavored malt beverages as beer rather than spirits, which were taxed at a much higher rate under the Act. The district court concluded (1) Appellees had standing to challenge the Commission's regulation, and (2) the flavored malt beverages were spirits under the Act. The Supreme Court affirmed, holding (1) the court correctly concluded that the taxpayer had taxpayer standing to assert this claim, and therefore, it was unnecessary for the Court to consider whether the nonprofits also had standing; and (2) the Commission exceeded its statutory authority by classifying and taxing flavored malt beverages as beer, as the Act unambiguously required flavored malt beverages to be classified as spirits. View "Project Extra Mile v. Neb. Liquor Control Comm'n" on Justia Law

King County sought ways to provide legal defense services to indigent criminal defendants. The County settled on a system of using nonprofit corporations to provide services funded through and monitored by the County's Office of the Public Defender (OPD). Over time, the County took steps to improve and make these nonprofit organizations more accountable to the County. In so doing, it asserted more control over the groups that provided defender services. Respondents are employees of the defender organizations who sued the County for state employee benefits. They argued the County's funding and control over their "independent" organizations essentially made them state employees for the purposes of participating in the Public Employees Retirement System (PERS). Applying the pertinent statues and common law principles, the Supreme Court agreed that employees of the defender organizations are "employees" under state law, and, as such, are entitled to be enrolled in the PERS. View "Dolan v. King County" on Justia Law

During the November 2008 election season, parties Senate Majority Fund, LLC (SMF) and Colorado Leadership Fund (CLF) were registered with the I.R.S. as so-called "527" tax-exempt political organizations. In the run-up to the November 2008 election, SMF distributed eight printed political ads and one television ad and CLF distributed eight printed ads that were the subject of this dispute. None of the seventeen ads contained words or phrases that specifically directed the viewer to "vote for," "elect," "support," "vote against," "defeat," or "reject." Similarly, none of the ads included the phrase "[candidate] for [office]." The court of appeals affirmed dismissal of this case by an administrative law judge (ALJ) for failing to state a claim upon which relief could be granted. At issue is the meaning of "expressly advocating the election or defeat of a candidate," as that phrase is used within the definition of "expenditure" in article XXVIII of the Colorado Constitution, the Campaign and Political Finance provision. The parties contended that "express advocacy" encompassed only those advertisements that explicitly exhort the viewer, listener, or reader to vote for or against a candidate in an upcoming election. This included the use of so-called "magic words," as set forth in "Buckley v. Valeo," (424 U.S. 1, 44 n.52 (1976)), as well as substantially similar synonyms of those words. Appellant Colorado Ethics Watch (Ethics Watch) argued that the category of advertisements that "expressly advocate" is more expansive and encompasses any advertisement that is the functional equivalent of express advocacy. The court of appeals rejected Ethics Watch's argument and held that, given the settled definition of express advocacy at the time that article XXVIII of the Colorado Constitution was adopted, the category of advertisements that constitute express advocacy was intentionally limited to include only those ads that use the magic words or those that explicitly advocate for the election or defeat of a candidate. After reviewing article XXVIII and the legal context in which it was adopted as a citizen's initiative in 2002 (known as Amendment 27), the Supreme Court agreed with the court of appeals that "expenditure" was intentionally and narrowly defined in article XXVIII to include only "express advocacy," so that it covers only those communications that explicitly advocate for the election or defeat of a candidate in an upcoming election. The Court affirmed the appellate court and remanded the case to the court of appeals to return to the ALJ to enter judgment consistent with the Court's opinion. View "Colorado Ethics Watch v. Senate Majority Fund, LLC" on Justia Law