Lawmakers’ Dispute With Clinton Library Seen as Test of Donor Privacy

By HARVY LIPMAN

Legal experts and charity officials are expressing concern over the implications of the battle between former President Bill Clinton’s presidential-library foundation and a congressional committee over disclosure of donors’ names.

Under several U.S. Supreme Court rulings, donor confidentiality is in most cases protected by the First Amendment’s guarantees of freedom of association and freedom of speech. But an effort by the House Committee on Government Reform to force the foundation to release a list of all of its donors challenged those legal precedents.

Such an attempt by Congress to force a nonprofit group to disclose its donors’ names has the potential to change the way all nonprofit groups operate in the future, said Frances Hill, a law professor at the University of Miami School of Law who specializes in nonprofit issues.

“The nonprofit community should be intensely interested in this presidential-library case,” she said.

She said nonprofit groups need to balance concerns about protecting their donors’ confidentiality with the necessity of preventing abuse of tax-exempt funds. She said charities must take into account the fact that “exempt organizations can be used by people who like to obscure how they’re raising and using money for any number of purposes, including political activity.”

Pardon of Financier

The House committee’s inquiry focused on whether there was any connection between the pardon Mr. Clinton granted fugitive financier Marc Rich and donations his ex-wife, Denise Rich, made to the William J. Clinton Presidential Foundation. Last month the committee issued a subpoena ordering the foundation to disclose the names of any donors who contributed or pledged more than $5,000, as well as any records related to donations made by Marc Rich, Denise Rich, and other people and corporations linked to them.

The foundation released the information related to Denise Rich, but initially refused to turn over information about other donors. In a letter to the House committee, David E. Kendall, a lawyer who represents the foundation, said the subpoena was unconstitutional. Last week Mr. Kendall and Representative Dan Burton, the Indiana Republican who chairs the committee, were attempting to work out a compromise.

In his response to the subpoena, Mr. Kendall cited a number of Supreme Court rulings that he said give donors to charitable organizations broad First Amendment protections. The rulings, he said, stipulate that the government must show a “compelling” need for the information. Mr. Kendall argued that the committee has no reason to believe all the foundation’s contributors are somehow linked to Mr. Rich. “The subpoena is thus a classic fishing expedition,” he added.

Representative Burton called the foundation’s response “unacceptable.” He threatened the foundation’s president, Skip Rutherford, with contempt of Congress and directed him to testify before the committee.

One difficulty in predicting how the courts would treat a challenge to the committee’s subpoena, Ms. Hill said, is that presidential libraries are different legal entities from other nonprofit organizations. Under a law enacted by Congress in 1955, the cost of constructing them is paid by nonprofit groups, but the presidential documents are maintained by the government.

“This is all uncharted territory,” said Ms. Hill. That doesn’t mean, however, that a decision limiting or eliminating confidentiality of their donor lists would not affect charities as a whole, she added.

A court case on the matter could be resolved without affecting nonprofit groups’ First Amendment protections, several experts noted. Subpoenas are frequently challenged for being overly broad — that is, for seeking information that is not germane to an investigation. Ms. Hill pointed out that courts often will try to resolve cases without having to decide them on constitutional grounds.

If a case involving an institution like the Clinton library foundation did wind up being decided on the basis of the First Amendment, however, it would become a balancing act between free-speech rights and the government’s public-policy interest in obtaining the information, according to legal experts.

Civil-Rights Case

One of the key precedent-setting cases dates from 1958, when — at the height of the civil-rights movement — the state of Alabama ordered the National Association for the Advancement of Colored People to disclose its membership list as a prerequisite for registering as a nonprofit organization. The Supreme Court ruled against the state, Ms. Hill said, because it didn’t think the state’s interest justified interfering with the First Amendment rights of N.A.A.C.P. members, especially at a time when revealing their involvement could have posed a threat to their safety.

The Clinton library donors’ lives wouldn’t be at risk if their names were widely known, legal experts acknowledged, but they could be drawn into an investigation of the Clinton pardons.

Beyond the immediate circumstances of the Clinton case, charity officials say there are many other valid reasons why donors prefer confidentiality.

John Von Kannon, vice president of the Heritage Foundation, a conservative think tank in Washington, added that revealing the names of donors could have a chilling effect on potential contributors. “We have some conservative critics of the Heritage Foundation who don’t like the fact that we favor free-trade policies, including free trade with China.” If donors couldn’t be promised anonymity, some might choose not to contribute rather than risk being attacked by other conservatives over the issue, he said.

Nonprofit groups that advocate for liberal causes share similar concerns. “We litigate, we investigate, we publish controversial information,” said Joseph Levin, president of the Southern Poverty Law Center, in Montgomery, Ala., which focuses on civil-rights issues. “All of those are things that people feel strongly about pro and con, and our donors have this reasonable expectation that we’ll maintain their participation in confidence.”