Conservative Group's IRS Targeting Claim Can Move Forward

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By Matthew Beddingfield

May 26 — A conservative organization arguing the IRS targeted its application for tax-exempt status based on its political views demonstrated that its claim of unconstitutional targeting has merit, and can continue in federal district court ( Freedom Path, Inc. v. Lerner, N.D. Tex., No. 3:14-cv-01537, 5/25/16 ).

The U.S. District Court for the Northern District of Texas on May 25 rejected the government's motion to dismiss Freedom Path Inc.'s First Amendment claim that the Internal Revenue Service subjected the group's applications for tax-exempt status to higher scrutiny, flagging groups that had “conservative sounding names.”

The district court previously dismissed the group's claim against Lois Lerner, former director of the IRS's Exempt Organizations Division, but permitted Freedom Path to replead (38 DTR K-1, 2/26/15).

First Amendment Rights

According to Freedom Path, the government violated its First Amendment rights by subjecting its application to heightened scrutiny and unconstitutional requests for information. The government argued that the group's claims were moot because its employees had been trained on how to handle applications from all groups to make the process fair.

Judge Sidney A. Fitzwater, however, found that the general complaints from Freedom Path still presented a “live controversy.”

Claims Too Speculative

Fitzwater also rejected the government's argument that the group's standing argument failed regarding the future curtailment of speech because it was “too speculative and amorphous to give rise to standing,” saying that Freedom Path had sufficiently pleaded future harm to establish injury.

The conservative group dropped its claims against several unnamed IRS officials in their official capacities.

Christopher K. Gober of Gober Group PLLC represented Freedom Path. Robert J. Witte of Strasburger & Price LLP represented Lerner. Grover Hartt III of the Department of Justice represented the government.

To contact the reporter on this story: Matthew Beddingfield in Washington at

To contact the editor responsible for this story: Brett Ferguson at

For More Information

Text of the opinion is in TaxCore.