On November 12, 2009, The Association of Community Organizations for Reform Now (ACORN), the ACORN Institute, and the New York ACORN Housing Company filed filed a case in the District Court for the Eastern District of New York challenging Congress's defunding of the organization.
ACORN is a non-profit Arkansas Corporation headquartered in Brooklyn. It is dedicated to organizing and assisting low-income people through voter registration, home loan and foreclosure counseling, public housing and food stamp awareness, and other programs. The ACORN Institute, Inc. a non-profit corporation headquartered in New Orleans, and the New York ACORN Housing Company are not subsidiaries of ACORN but work closely with the nationwide organization. All three organizations collaborate with federal, state, and local governments and other institutions, and receive federal funding.
In September 2009, anti-ACORN activists posed as prostitute and pimp and secretly videotaped ACORN employees. The tapes purportedly showed employees giving the activists tax advice on running illegal businesses including sex trafficking. ACORN's complaint denied the allegations and said it fired the employees. In response to the video, Congress enacted specific prohibitions against funding ACORN in several "continuing resolutions," which Congress enacts when the new fiscal year is about to begin and they have not yet enacted a regular appropriations act.
These temporary acts authorized administrative agencies to distribute grants but contained an express condition forbidding grants to ACORN or any organization related to it. For example, Section 163 read: "None of the funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now ("ACORN"), or any of ACORN'S affiliates, subsidiaries, or allied organizations."
The Office of Management and Budget issued a memo on October 7, 2009, warning all agency heads not to appropriate funds to ACORN and its affiliates in 2009 or 2010, even if the agency had already appropriated the funds to ACORN. The Department of Housing and Urban Development, in response, suspended funding to ACORN.
According to the complaint, the cryptic language of the appropriation's acts ("any of ACORN's affiliates, subsidiaries, or allied organizations") made ACORN a pariah. Banks, universities, and other organizations who had partnered with ACORN feared this broad language would bring them under congressional scrutiny as well. State agencies and private parties cancelled contracts. ACORN alleged the acts deprived it of grants and forced it to lay off up to 85 percent of its staff.
Plaintiffs allege that: (1) by singling out ACORN specifically, the appropriation acts were unconstitutional bills of attainder, violating Article I, Section 9 of the U.S. Constitution; (2) the acts violated ACORN's First Amendment rights and those of its past partners because the language "any affiliates, subsidiaries, or allied organizations" was vague and overbroad; and (3) the acts violated the Fifth Amendment because in dealing with ACORN the agencies did not follow due process procedures to withholding grants from criminal or fraudulent enterprises.
On November 13, 2009, the court (Judge Nina Gershon) denied plaintiffs' motion for a temporary restraining order. However, on December 11, 2009, the court granted ACORN a preliminary injunction. Furthermore, on March 10, 2010, the court granted a declaratory judgment and a permanent injunction in favor of the plaintiffs. The court found that the appropriations acts were unconstitutional bills of attainder because the acts functioned as "punishment" which is a function reserved solely to the judicial branch. Deprivation of future funding opportunities, according to the court, was "punishment." The Court held that the remarks of Congress and the fact that there was no investigation of ACORN demonstrated congressional intent to punish.
The court issued a declaratory judgment that the appropriations acts were unconstitutional bills of attainder. The court also found that reputational injury to ACORN alone was enough to warrant a permanent injunction, which enjoined agency personnel from enforcing the conditions in the acts and ordered Director Orszag of the OMB to draft a new memorandum advising agencies that the acts were unenforceable.
The defendants moved to stay the injunction pending appeal, which motion the district court denied on March 31, 2010. However, the U.S. Court of Appeals for the Second Circuit, (Judge Gerald Lynch), approved a temporary administrative stay on April 2, 2010. Then, a three judge panel consisting of Judges Roger Miner, Jose Cabranes, and Richard Wesley issued a stay of the declaratory judgment and the permanent injunction on April 21, 2010.
On August 13, 2010 the 2nd Circuit unanimously reversed the district court's decision on the Bill of Attainder victory. The court found ACORN had standing but no bill of attainder claims. They sent the case back to the District Court to look at First Amendment and Due Process violations.
Due to their struggles with their bankruptcy proceedings, the Plaintiffs agreed to dismissal of the case (with prejudice) on August 1, 2011.Joshua Arocho - 06/18/2012