Today, the DC Circuit Court of Appeals ruled in favor of pro-Israel group Z STREET on the grounds of viewpoint discrimination by the IRS violating the First Amendment. The Opinion of the DC Circuit Court clears the way for Z STREET to proceed with discovery in its case against the IRS.
The Power Line Blog noted these comments of Z STREET:
Z STREET looks forward to the discovery phase of litigation in which it will seek to learn the nature and origin of the “Israel Special Policy” which the IRS applied to Z STREET’s tax exemption application. Z STREET will seek to learn how such a policy was created, who created it, who approved it, to whom it was applied, as well as all other information regarding this policy.
A series of IRS documents called “Be On the LookOut” lists, which were released by Congress in June, 2013, pursuant to the TIGTA investigation, have already established that, as Z STREET alleges, while Z STREET’s application for tax exempt status was pending, the IRS did indeed create a special category of review for organizations seeking such status, if they were engaged in what the IRS called “occupied territory advocacy.”
Z STREET looks forward to using the discovery process to learn more about the precise nature, origin and effect of this policy, which the DC Circuit has now made clear is a violation of essential Constitutional rights.
In a May 7th , 2015 Iconoclast post on the arguments before the DC Circuit, it was clear that the Circuit Judges were displeased with brief filed by the IRS Counsel. We wrote about the background for today’s important ruling:
It’s hard enough being a Zionist in the US, given a passive Jewish community supine under the sway of Obama Administration isolating Israel. Z STREET, where I am a member of its board, has fought a special process by the IRS sidelining its application for 501 ( c) (3) status because- get this- it advocates for an ally where terrorism occurs against it. Call that ultimate chutzpah, and you might come close it what it is. That is absurd. However, that is at the heart of the viewpoint discrimination issue under the First Amendment successfully argued in the filing made by Z STREET’s counsel. The IRS had unsuccessfully fought in the DC Federal District court to dismiss the Z STREET case in May 2014. The lower Court granted discovery to Z STREET on the grounds of viewpoint discrimination. The IRS appeal of the lower court ruling granting discovery was heard at a D.C. Circuit Court of Appeals oral arguments proceeding on May 4, 2015. The three judge Appellate panel virtually raked over the coals the IRS counsel and leadership of the federal tax agency, several of whom were in court witnessing their upbraiding . A May 7, 2015 Wall Street Journal editorial lambasted the IRS and the Justice Department for violating the First Amendment rights of Z STREET , “The IRS Goes to Court”. The tag line says it all: “The agency suggests it can discriminate for 270 days. Judges gasp.”
In an opinion filed today on the matter of Z Street v Koskinen. Commissioner of Internal Revenue Service, DC Circuit Judge David Tatel affirmed the arguments presented by Z Street’s Counsel, Jerome Marcus. Below is a summary of the Opinion filed by Judge Tatel:
USCA Case #15-5010 Document #1558566 6-19-2015
Before: GARLAND, Chief Judge, TATEL, Circuit Judge, and SENTELLE, Senior Circuit Judge.
Opinion for the Court filed by
Circuit Judge TATEL:
Z Street, a nonprofit organization devoted to educating the public about Zionism” and “the facts relating to the Middle East,”applied for a section 501 (c )(3) tax exemption. Based on a conversation its lawyer had with an IRS agent, Z Street alleges that the agency has an “Israel Special Policy” under which applications from organizations holding “political views inconsistent with those espoused by the Obama administration” receive increased “scrutiny[y]” that results in such applications “tak[ing] longer to process than those made by organizations without that characteristic”.
”Z Street sued the Commissioner, alleging that the “Israel Special Policy” violates the First Amendment. The Commissioner moved to dismiss, arguing that the action is barred by the Anti Injunction Act, which prohibits suits to “restrain the assessment or collection of any tax.” The district court, assuming the truth of Z Street’s allegations—as it must at this stage of the litigation—denied the motion explaining that Z Street was not seeking to restrain the “assessment or collection” of a tax, but rather to prevent the IRS from delaying consideration of its application in violation of the First Amendment. We affirm.
Consider this the lengths to which the Administration will go to deny pro-Zionist views opposing groups like J Street , Jewish Voices for Peace, Peace Now; all with IRC 501 (c ) (3) tax exemptions. The irony is that these groups are pursuing BDS, delegitimization and demonization of the Jewish nation of Israel, America’s only democratic ally in the Middle East.
EDITORS NOTE: This column originally appeared in the New English Review.