Justia Non-Profit Corporations Opinion Summaries

The Supreme Court of the State of Washington found that the initiation fees charged by Royal Oaks Country Club, a nonprofit corporation, are fully deductible from the business and occupation (B&O) tax under RCW 82.04.4282. The statute permits taxpayers to deduct "bona fide" initiation fees, among other things, from their B&O tax. The court held that these initiation fees were "bona fide" as they were paid solely for the privilege of membership, and did not automatically entitle a member to use any service or facility of the club. The court differentiated between dues and initiation fees, noting that the statute treats these two terms separately. The court rejected the Washington Department of Revenue's argument that a portion of the initiation fee was for access to facilities and thus not subject to the exemption, stating that there is a difference between access and use. The court affirmed the Court of Appeals' decision that Royal Oaks' initiation fees qualify as bona fide initiation fees and are therefore wholly deductible. View "Royal Oaks Country Club v. Dep't of Revenue" on Justia Law

In a case before the United States Court of Appeals for the Tenth Circuit, private citizens and a non-profit organization sued High Mountain Mining Company for alleged violations of the Clean Water Act. The plaintiffs claimed that High Mountain Mining, which operates a gold mine in Colorado, allowed pollutants from its settling ponds to seep into the groundwater, which then migrated into a nearby river. Under the Clean Water Act, a permit is required for any discharge of pollutants from a point source into navigable waters. The district court ruled in favor of the plaintiffs, finding that the settling ponds were a point source and that the operation of these ponds constituted an unpermitted discharge of pollutants into navigable waters, thus violating the Clean Water Act. On appeal, the Tenth Circuit disagreed and reversed the district court's decision. The appellate court held that the district court made a legal error by not adequately considering all the relevant factors to determine whether the connection between the point source and the navigable water was the functional equivalent of a direct discharge. Given the potentially broad implications of the Clean Water Act for mines throughout the Western United States, the appellate court remanded the case back to the district court for further proceedings. View "Stone v. High Mountain Mining Company" on Justia Law

The Supreme Court of Missouri reversed the circuit court's ruling and held that the Truly Agreed and Finally Passed House Bill 1606 (2022) (“TAFP HB 1606”) violated the single subject requirement of article III, section 23 of the Missouri Constitution. The bill was initially proposed to reduce the amount of information certain counties had to publish in their financial statements. However, the bill underwent several modifications, including the addition of section 67.2300, which imposed restrictions on the expenditure of state funds for combating homelessness and made unauthorized sleeping and camping on state-owned lands a class C misdemeanor. The appellants, including a group of individuals and a non-profit organization, argued that the addition of section 67.2300 altered the bill's original purpose, introduced a second subject to the bill, and rendered the bill's title unclear, thereby violating the single subject, clear title, and original purpose requirements of the Missouri Constitution. The court agreed, finding that the provisions of section 67.2300 did not fairly relate to or have a natural connection with the bill's general subject of "political subdivisions," but rather related to the completely different subject of homelessness. Consequently, the court declared TAFP HB 1606 invalid in its entirety. View "Byrd v. State of Missouri" on Justia Law

In the state of Kansas, a number of non-profit groups, including the League of Women Voters of Kansas and the Kansas Appleseed Center for Law and Justice, challenged a law which made it a felony to engage in conduct that gives the appearance of being an election official or that would cause another person to believe a person is an election official. The non-profits argued that the law was overbroad and unconstitutionally vague, as it could criminalize their voter education and registration activities. They also claimed that the law violated their rights to free speech and association. The district court denied their request for a temporary injunction and the Court of Appeals dismissed the non-profits' claims for lack of standing, arguing that they were not at risk of prosecution under the statute. The Supreme Court of the State of Kansas reversed these decisions, finding that the non-profits did have standing to challenge the law. The Court held that when a law criminalizes speech and does not clearly demonstrate that only constitutionally unprotected speech is being criminalized, the law is unclear enough to confer pre-enforcement standing on a plaintiff challenging the law. The Supreme Court of the State of Kansas vacated the Court of Appeals' decision and remanded the case to the Court of Appeals for further proceedings. View "League of Women Voters of Kansas v. Schwab" on Justia Law

At issue in this case was the distribution of charitable donations received by the International Rescue Committee (“IRC) to aid four refugee families and others in the refugee community who were victims of a mass stabbing incident in Boise, Idaho, in 2018. Mustafa Mohammed and Ekhlas Al Khudhur (“Appellants”) challenged a magistrate court’s order approving the final distribution of funds as proposed by IRC. IRC calculated the final distribution of donated funds to the families using a formula of its own creation based on methodology and principles developed by Kenneth Feinberg, an expert on compensation fund valuation and distribution following high-profile, mass tragedies. The district court, acting in its intermediate appellate capacity, affirmed the magistrate court’s order, which held that a trust had been created and that the proposed distribution method for the donated funds was within IRC’s discretion as trustee. On appeal to the Idaho Supreme Court, Appellants argued the district court erred in affirming the magistrate court's decision by: (1) determining there had been a trust created; (2) concluding that IRC’s final distribution was reasonable or within IRC’s discretion; and (3) prohibiting Appellants from presenting evidence of their respective injuries from the attack. Finding no reversible error, the Supreme Court affirmed. View "International Rescue Committee v. Mohammed" on Justia Law

After shooting his ex-girlfriend and her boyfriend, Defendant was convicted by a jury of the following: two counts of premeditated attempted murder; two counts of assault with a deadly weapon; one count of inflicting corporal injury on a prior dating partner; and one count of being a felon in possession of a firearm. The jury also found true multiple enhancement allegations under section 12022.53. The trial court imposed the following sentence: two consecutive indeterminate terms of seven years to life for the premeditated attempted murder convictions (counts 1 & 4), plus two additional terms of 25 years to life for the respectively attached firearm enhancements under section 12022.53(d). All other enhancements attached to counts 1 and 4 were stayed under section 654. On appeal, Defendant argued the sentence should be vacated and remanded for resentencing under People v. Tirado (2022) 12 Cal.5th 688 (Tirado).     The Fifth Appellate District affirmed the trial court’s judgment but vacated Defendant’s sentence. The court remanded the case to the trial court for a resentencing hearing where further evidence and argument may be received regarding the sentence to be imposed. The court held that the trial court, in this case, made its sentencing decision in the absence of the new presumption against exceeding the middle term, and the record does not clearly indicate that the court would have imposed upper-term sentences had it been aware of the new constraint on its discretion. The court held that Gutierrez is binding and the appropriate remedy is to remand for the sentencing court to exercise its newly informed and circumscribed discretion in the first instance. View "P. v. Falcon" on Justia Law

“Breathe” was previously known as the American Lung Association of Los Angeles County, affiliated with the national organization, ALA, and the American Lung Association in California (ALAC). Breathe’s predecessor entered into annual agreements with ALAC and the ALA that provided for “income sharing” between Breathe and ALAC, except for “funds restricted in writing by the donor, not later than the date of donation, to exclude or limit sharing, such restriction not having been invited by the donee association.” ALA sued ALAC and its affiliates, including Breathe, for trademark infringement and related causes of action. Under a 2006 Consent Judgment, Breathe disaffiliated from the ALA and ALAC and was renamed. The parties agreed to a process for settling their outstanding accounts.In 2015, ALAC moved to enforce the Consent Judgment by compelling Breathe to share three bequests that were created but not distributed before the Consent Judgment. The trial court ruled in favor of the ALA, concluding the restricted funds exception of the Affiliate Agreement was ambiguous and that the bequests were shareable. The court of appeal reversed. The plain language of the bequests indicates the testators' intentions to benefit only the organization now known as Breathe. Sharing the bequests with the ALA is incompatible with those intentions and is not required under the Affiliate Agreement. View "Breathe Southern California v. American Lung Association" on Justia Law

The State of Washington brought multiple claims alleging that TVI Inc., doing business as Value Village, used deceptive advertising and marketing in violation of the Washington Consumer Protection Act (CPA), ch. 19.86 RCW. TVI operated about 20 for-profit thrift stores in Washington under the name Value Village. Approximately 93 percent of Value Village’s retail inventory consisted of used goods donated by the community. To source these community donations, TVI contracted with third-party nonprofit organizations, which TVI called its “‘charity partners.’” By working with charity partners, TVI obtained inventory at a lower price than it would pay a for-profit supplier. The charity partners, in turn, received a predictable source of unrestricted funding, as well as publicity from TVI’s marketing. In 2013, the Consumer Protection Division of the Attorney General’s (AG’s) Office received a complaint from a Washington resident that TVI’s marketing gives the false impression that Value Village is a nonprofit. The AG wrote to TVI in November 2014, instructing it to register as a commercial fundraiser pursuant to the CSA. The AG’s November 2014 letter raised additional concerns that TVI’s “solicitations for charitable contributions and advertisements for its retail stores” were “misleading or deceptive” in violation of the CPA. By the summer of 2015, TVI had posted signs in its stores disclosing its status as a for-profit commercial fundraiser in its stores. Following three years of investigation, the State filed this lawsuit. TVI argued the State's claims infringed on its First Amendment right to solicit charitable contributions on behalf of nonprofit organizations. The Supreme Court agreed with TVI, and remanded this case to the trial court for dismissal of the State’s claims. View "Washington v. TVI, Inc." on Justia Law

The City and Borough of Sitka, Alaska allowed an independent nonprofit organization to host a public event at a city facility. The nonprofit organization arranged for a volunteer to hang decorations in the facility; a decoration fell, injuring an event participant. The injured participant sued the City, but not the nonprofit organization, for negligence. The City brought a third-party allocation of fault claim against the volunteer. The parties sought summary judgment, and the trial court concluded that, under federal law, the volunteer could not be held financially responsible for the accident and that the City could not be held vicariously liable for the volunteer’s actions. The remaining negligence issues were decided at a jury trial; the jury determined that the volunteer and the city had not been negligent and therefore were not liable for the accident. The event participant appealed. Finding no reversible error, the Alaska Supreme Court affirmed the trial court judgment. View "Sulzbach v. City & Borough of Sitka, et al." on Justia Law

The Fairbanks North Star Borough partially revoked a local ministry’s charitable property tax exemption after learning that the ministry was renting lodging to the general public. The ministry appealed the Borough’s decision to the superior court. The court remanded the issue to the Borough’s assessor for more detailed findings, instructed the ministry that any appeal following remand should be made to the Board of Equalization rather than superior court, and closed the case. The assessor issued new findings justifying the partial revocation of the tax exemption, and the ministry appealed to both the Board and the superior court (in a different case). The ministry also filed a motion in the first appeal asking the superior court to enforce its order instructing that appeals be made to the Board. The superior court issued a sua sponte order granting the ministry’s first appeal on the merits, finding “that the assessor [did not] rely on sufficient evidence to revoke [the ministry’s] tax exempt status.” The Borough appealed. The Alaska Supreme Court concluded that following remand, supplemental Board findings, and a new appeal from those findings, the superior court lacked the subject matter jurisdiction to decide the ministry’s first appeal on the merits. The Supreme Court therefore vacate its decision granting Victory’s appeal. View "Fairbanks North Star Borough v. Victory Ministries of Alaska, Inc., et al." on Justia Law