As we all know, the Obama administration has made sure that no one at the IRS suffers any consequences for the political targeting of conservatives prior to the 2012 election. Eric Holder and Loretta Lynch have refused to prosecute any of the bureaucrats who were involved. They have declined to enforce the contempt citation against Lois Lerner for refusing to provide any information to Congress about her misbehavior and the inexcusable (and unlawful) abuse of the IRS’s power and authority for political purposes. But thanks to the U.S. Court of Appeals for the District of Columbia, some of the organizations that were persecuted, like True the Vote and Linchpins of Liberty, may finally get their day in court.
On Friday, Judge David Sentelle, writing for a unanimous three-judge panel of the D.C. Circuit, reinstated a portion of the lawsuits filed against the IRS by these and other organizations. In 2014, a district court had dismissed both the plaintiffs’ claims for money damages against the IRS and some of its employees, as well as their request for an injunction and a declaratory judgment (what is known as equitable relief) to stop the IRS from ever doing this again.
The district court held that money damages could not be obtained against the IRS or its employees and that the claims for equitable relief were “moot” because the IRS had supposedly stopped its wrongful behavior. While the court of appeals agreed with the ruling on money damages because of past precedent, it reversed the ruling on equitable relief and sent the cases back to the district court for further proceedings.
For those who have blindly accepted the claims of the administration and their political supporters in Congress that nothing untoward happened with the IRS, this opinion should be a wake-up call. As the appeals court says, “there is very little factual dispute between the parties as to the conduct committed by the IRS.” Instead of routinely processing their applications as it was obligated to do “in the normal course of IRS business, as would have been the case with other taxpayers, the IRS selected out these applicants for more rigorous review on the basis of their names, which were in each instance indicative of a conservative or anti-Administration orientation.”
The appeals court pointed out that the IRS had taken no action in this litigation “to disavow or discredit the report of investigation by its parent department.” This refers to the now well-known report of May 14, 2013, of the Treasury Inspector General for Tax Administration (IG) that exposed the “Inappropriate Criteria” being used by the IRS to target conservatives. That criteria included looking for any organizations with “Tea Party, Patriots, or 9/12 in the organization’s name” and then adding them to a “Be-On-The-Lookout” or BOLO list for special scrutiny.
That IG audit report, according to the court, recognized “that the IRS’s handling of exemption applications from persons of disfavored viewpoints utterly failed” to fulfil the mission of the IRS, which is to apply “the tax law with integrity and fairness to all.” The audit report is “replete with details of discriminatory processing and delay.”
As the court warned the IRS, the First Amendment bans the government from restricting “expression because of its message, its ideas, its subject matter, or it content.” In administering the tax code, “the IRS may not discriminate on the basis of viewpoint.” Processing “exemption applications pursuant to different standards and at different rates depending upon the viewpoint of the applicants” is a “blatant violation of the First Amendment.”
Indeed, the appeals court said that it is “plain to the Inspector General, the district court, and this court that the IRS cannot defend its discriminatory conduct on the merits.” Thus, the question is “whether the controversy is moot.” While the district court concluded that it was, “we conclude that it is not.”
The IRS argued that it had stopped its wrongful behavior. But the appeals court said there is a difference between a controversy where the defendant has stopped his wrongful conduct but could resume it at any time, and a controversy where there is no “reasonable expectation that the conduct will recur” and “interim relief or events have completely and irrevocably eradicated the effects of the alleged violation.” This latter concept is referred to legally as “voluntary cessation.”
But the IRS cannot meet the “voluntary cessation” criteria according to the appeals court. Why? Because “voluntary cessation has never occurred.” The IRS admitted that the “applications for exemption by some of appellant-plaintiffs have never to this day been processed.” The IRS “proudly boasts” that “no more than two” applications are still pending. To that boast, the court said it “would advise the IRS that a heavy burden of establishing mootness is not carried by proving that the case is nearly moot, or is moot as to the a ‘vast majority’ of the parties. Their heavy burden requires that they establish cessation, not near cessation.”
The court also faulted the IRS for its “rather puzzling explanation for why the continued failure to afford proper processing to at least some of the victim applications should not prevent a finding of cessation.” The IRS’s explanation is that the applications have not been processed because of the litigation filed by the organizations. As the court says:
It is not at all clear why the IRS proposes that not ceasing becomes cessation if the victim of the conduct is litigating against it. The IRS position is reminiscent of Catch-22 from the novel of the same name. Under that ‘catch,’ World War II airmen were not required to fly if they were mentally ill. However, anyone who applied to stop flying was evidencing rationality and therefore was not mentally ill.
The result is a catch-22 situation, according to the court: “The IRS is telling the applicants in these cases that ‘we have been violating your rights and not properly processing your applications. You are entitled to have your applications processed. But if you ask for that processing by away of a lawsuit, then you can’t’ have it.’”
The IRS’s only other attempt to justify this was to refer to it as “longstanding policy.” But the court admonished that “if you haven’t ceased discriminatory conduct, the fact that you have been failing to cease it for a long time does not create cessation.”
While the main focus of the court’s opinion was on the delay in processing the applications of the organizations, it also held that the claims about “harassing, probing, and unconstitutional requests for additional information that … required applicants to disclose, among other things, donor lists, direct and indirect communications with members of legislative bodies, Internet passwords, and user names, copies of social media and other Internet postings, and even the political and charitable activities of family members” were not moot.
In a final warning that should scare all taxpayers, particularly conservatives, the court pointed out that even if the IRS had ceased its wrongful conduct with regard to these organizations, the IRS failed to show that there is no reasonable expectation that the conduct will reoccur. The IRS itself said that it had only “suspended” the use of BOLO lists “until further notice.” A “violation of a right that is ‘suspended until further notice’ has not become the subject of voluntary cessation, with no reasonable expectation of resumption.” At most, it is advising “the victim of a violation – ‘you’re alright for now, but there may be another shoe falling.’”
In other words, there are no real legal barriers in place to prevent the IRS — one the most powerful agencies in the federal government — from targeting Americans for their political viewpoints again.
This piece first appeared in Conservative Review.