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Nonprofit Seeks Damages for Misuse Of Donor Lists and Other Trade Secrets

Magistrate Judge recommends Court deny defendants’ motion to dismiss claims of misuse of confidential information

A Magistrate Judge in the federal District Court of Oregon has recommended that a nonprofit organization be permitted to continue its suit against two former employees and their new business entity for misusing the nonprofit’s donor lists and other trade secrets and disclosing confidential information obtained while they worked for the organization.  The judge has rejected motions to dismiss claims for misappropriation of trade secrets, intentional interference with economic relationships, defamation, and breach of the duty of loyalty.

Court Further Confuses Status of 501(c)(4) Rules

In case started in 2011, Court has requested applicant and IRS to re-argue applicable standards

In a case starting during the IRS “scandal” for allegedly holding up applications for conservative 501(c)(4) social welfare status for a variety of groups in 2011, the federal District Court for the District of Columbia has held that IRS rulings on what constitutes intervention in political campaigns are void for vagueness.  It has remanded the case for the parties to reargue their positions on the standards for deciding the case.

Non-religious Nonprofit May Seek Protection Under Religious Freedom Restoration Act

Court of Appeals says corporation may argue religious infringement in denial of approval for supervised illegal drug use program

A non-religious nonprofit corporation may argue that its religious freedom has been infringed by the government’s denial of approval for a program to address the abuse of opioids through overdose prevention services, including supervised illegal drug use, the Third Circuit Court of Appeals.  It has returned the case to the District Court in Philadelphia to determine whether the denial violates the corporation’s religious freedom under the Religious Freedom Restoration Act.

Nonprofit School Trustee Is Not Agent Protected from Retaliation under FCA

False Claims Act does not protect trustee fired after questioning use of funds from Covid programs

A trustee of a nonprofit private secondary school is not an “agent” subject to protection from retaliation under the federal False Claims Act, a federal District Court in South Carolina has ruled.  The trustee’s claim has been dismissed on summary judgment.

IRS Proposes Deal to Ignore Johnson Amendment for Churches

Proposed consent judgment would prohibit enforcement of electioneering prohibition against two Texas churches

The Internal Revenue Service has joined with two Evangelical churches in Texas and the National Association of Religious Broadcasters in proposing a settlement of their litigation to overturn the so-called “Johnson Amendment” to the Tax Code that prohibits churches and other charities from endorsing or opposing candidates for public office.  (See Nonprofit Issues®, Vol. XXXIV, No. 4)

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