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Case Name Freedom from Religion Foundation v. Geithner FA-CA-0004
Docket / Court 09-cv-02894-WBS-DAD ( E.D. Cal. )
State/Territory California
Case Type(s) Speech and Religious Freedom
Case Summary
On October 16, 2009, the Freedom From Religion Foundation and several individuals filed a complaint in the Eastern District of California against Secretary of the Treasury Timothy Geithner, IRS Commissioner Douglas Shulman, and California Franchise Tax Board Executive Selvi Stanislaus for violating ... read more >
On October 16, 2009, the Freedom From Religion Foundation and several individuals filed a complaint in the Eastern District of California against Secretary of the Treasury Timothy Geithner, IRS Commissioner Douglas Shulman, and California Franchise Tax Board Executive Selvi Stanislaus for violating the Establishment Clause of the First Amendment of the U.S. Constitution. Plaintiffs sought a declaration under 28 U.S.C. § 2201 that 26 U.S.C. §§107 and 265(a)(6) violated the Establishment Clause by providing preferential tax benefits to ministers of the gospel.

Section 107 provides a tax exclusion for the rental value of a home furnished to a minister as part of his compensation or the rental allowance paid to him as part of his compensation. In order to qualify for this exclusion, the home or rental allowance must be provided as remuneration for services which are "ordinarily the duties of a minister of the gospel." Section 265(a)(6) allowed a minister of the gospel to claim deductions for residential mortgage interest and property taxes. Plaintiffs requested that the Court enjoin any allowance or grant of tax benefits for ministers of the gospel under §§107 and 265(a)(6). Plaintiffs also sought an injunction against the California Franchise Tax Board for sections 17131.6 and 17280(d)(2) of the California Revenue and Taxation Code, which provided similar tax benefits to ministers of the gospel.

On October 22, 2009, an individual named pastor and 100 unnamed ministers moved to intervene in the action. On December 2, 2009, the District Court (Judge William B. Shubb) denied the requests to intervene on grounds the movants' interests were adequately represented by the federal defendants, and that they failed to show independent grounds for jurisdiction. Freedom From Religion Foundation, Inc. v. Geithner, 262 F.R.D. 527 (2009).

The federal defendants and Selvi Stanislaus filed separate Motions to Dismiss on February 26, 2010. On May 21, 2010, Judge Shubb granted Stanislaus' motion to dismiss with respect to plaintiffs' claims under the California constitution and plaintiffs' claims challenging California Revenue and Taxation Code section 17280(d)(2), and denied the motion in all other respects. Judge Shubb further denied the federal defendants' motion to dismiss with respect to plaintiff's claim challenging Internal Revenue Code § 107 and granted the motion with respect to plaintiff's claim challenging Internal Revenue Code § 265(a)(6).

The Pastors appealed the denial of the Motion to Intervene to the 9th Circuit. On May 9, 2011, the 9th Circuit affirmed the District Court's denial of the motion for intervention as of right but vacated the denial of the motion for permissive intervention. The 9th Circuit explained that the District Court did not apply the correct legal rule; the Pastors were not required to make any further showing of independent jurisdictional grounds.

On May 26, 2011, the federal defendants filed a motion challenging plaintiffs' standing in light of Arizona Christian School Tuition Organization v. Winn, 131 S.Ct. 1436 (2011). On May 27, 2011, Selvi Stanislaus filed a motion for judgment on the pleadings on the same grounds. In Arizona Christian School Tuition Organization v. Winn, filed on April 4, 2011, the Supreme Court held that taxpayers lacked standing to bring an Establishment Clause claim on Arizona's tuition tax credit.

On June 17, 2011, the parties jointly submitted a Stipulation of Dismissal to the Court and the matter was dismissed without prejudice on June 20, 2011.

David Priddy - 06/24/2011
Samantha Kirby - 10/20/2014


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Issues and Causes of Action
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Issues
Constitutional Clause
Establishment Clause
General
Religious programs / policies
Plaintiff Type
Private Plaintiff
Causes of Action Declaratory Judgment Act, 28 U.S.C. § 2201
Defendant(s) California Franchise Tax Board
United States Department of the Treasury
Plaintiff Description Plaintiff is a non-profit organization that promotes the separation of church and state
Indexed Lawyer Organizations None on record
Class action status sought No
Class action status granted No
Prevailing Party None Yet / None
Public Int. Lawyer No
Nature of Relief None
Source of Relief None
Form of Settlement Voluntary Dismissal
Order Duration not on record
Case Closing Year 2011
Case Ongoing No
Case Listing FA-WI-0001 : Freedom from Religion Foundation v. Geithner (W.D. Wis.)
Docket(s)
09-cv-02894 (E.D. Cal.) 07/05/2011
FA-CA-0004-9000.pdf | Detail
PACER [Public Access to Court Electronic Records]
General Documents
Complaint 10/16/2009
FA-CA-0004-0002.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Memorandum in Support of Motion to Intervene 11/23/2009
FA-CA-0004-0006.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Memorandum and Order Re: Motion to Intervene 12/02/2009 (262 F.R.D. 527) (E.D. Cal.)
FA-CA-0004-0009.pdf | WESTLAW| LEXIS | Detail
Document Source: Google Scholar
Brief of Appellant 03/26/2010 (2010 WL 2861340)
FA-CA-0004-0003.pdf | WESTLAW | Detail
Document Source: Westlaw
Brief For the Federal Appellees 05/10/2010 (2010 WL 2861339)
FA-CA-0004-0004.pdf | WESTLAW | Detail
Document Source: Westlaw
Reply Brief of Appellant 05/24/2010 (2010 WL 2861338)
FA-CA-0004-0005.pdf | WESTLAW | Detail
Document Source: Westlaw
9th Circuit Opinion 05/09/2011 (644 F.3d 836)
FA-CA-0004-0008.pdf | WESTLAW| LEXIS | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Order on Stipulation of Dismissal 06/17/2011 (E.D. Cal.)
FA-CA-0004-0007.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Judges Campbell, Tena (D. Utah)
FA-CA-0004-0008
Drozd, Dale Alan (E.D. Cal.) [Magistrate]
FA-CA-0004-9000
O'Scannlain, Diarmuid Fionntain (Ninth Circuit)
FA-CA-0004-0008
Shubb, William B. (E.D. Cal.)
FA-CA-0004-0007 | FA-CA-0004-0009 | FA-CA-0004-9000
Monitors/Masters None on record
Plaintiff's Lawyers Bolton, Richard L. (Wisconsin)
FA-CA-0004-9000
Newdow, Michael A. (California)
FA-CA-0004-0002 | FA-CA-0004-9000
Defendant's Lawyers Hendon, Jeremy Nolan (District of Columbia)
FA-CA-0004-9000
McReynolds, Matthew Brown (California)
FA-CA-0004-0003 | FA-CA-0004-0005 | FA-CA-0004-0006 | FA-CA-0004-9000
Schwartz, Richard Adam (District of Columbia)
FA-CA-0004-9000
Snider, Kevin Trent (California)
FA-CA-0004-0003 | FA-CA-0004-0005 | FA-CA-0004-0006 | FA-CA-0004-9000
Other Lawyers Dale, Ivan C. (District of Columbia)
FA-CA-0004-0004
DiCiccio, John A. (District of Columbia)
FA-CA-0004-0004
McLaughlin, Theresa E. (District of Columbia)
FA-CA-0004-0004
Rothenberg, Gilbert S. (District of Columbia)
FA-CA-0004-0004
Wagner, Benjamin B. (California)
FA-CA-0004-0004

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