The Justice Department announced that it has settled two lawsuits – one for millions of dollars – in connection with the IRS’ scrutiny of Tea Party groups in Albuquerque and across the country.
The Albuquerque Tea Party had earlier opted out of the class-action lawsuit that resulted in a multimillion settlement, but the group’s president, Graham Bartlett, said the local political group is part of a second settlement in which the IRS admitted that it was wrong to target the groups for extra scrutiny.
“We are very pleased with our settlement,” Bartlett told the Journal on Friday, adding that his group sued the government on “principle.” The Albuquerque group was among the earliest in the nation to protest the IRS taking so long to determine whether it was a tax-exempt group.
“We got, basically, what we wanted, which is to make sure the IRS does not do this to anybody else – not just conservative groups – but anybody else. The government can’t bully us around just because of our political thinking.”
Both cases are final pending approval from the district courts. The actual dollar amount of the class-action settlement with the federal government was kept confidential, but the plaintiffs’ Kansas City-based attorney, Edward Greims, confirmed to the Journal on Friday that it totaled millions of dollars.
The Justice Department said it is settling the lawsuit involving the Albuquerque Tea Party and some 40 other conservative groups with an apology from the IRS for the intensive scrutiny of the groups. The group argued that their constitutional rights were violated when they were singled out for additional tax scrutiny based on their political views.
In 2012, the American Center for Law and Justice filed a lawsuit against the IRS on behalf of the Albuquerque Tea Party and other conservative groups whose requests for tax-exempt status was delayed during the Obama administration. The ACLJ is a conservative, Christian-based organization associated with Regent University School of Law in Virginia Beach, Va. The organization’s chief counsel is Jay Sekulow, a member of President Donald Trump’s private legal team.
In 2013, the IRS admitted targeting the groups in part by focusing attention on those with “tea party” or “patriot” in their names. Many had their applications delayed for months and years. Some were asked improper questions about their donors and even their religious practices, an inspector general’s report found. The Albuquerque Tea Party was finally granted tax-exempt status in July after an eight-year fight.
While the Trump administration’s decision to settle the lawsuits favors political groups that are mostly political allies of the White House, Attorney General Jeff Sessions said it was clear the IRS abused its power and “there is no excuse for this conduct.”
“The IRS’ use of these criteria as a basis for heightened scrutiny was wrong and should never have occurred,” Sessions said in a statement Thursday. “It is improper for the IRS to single out groups for different treatment based on their names or ideological positions. Any entitlement to tax exemption should be based on the activities of the organization and whether they fulfill requirements of the law, not the policy positions adopted by members or the name chosen to reflect those views.”
The FBI in 2014 announced its investigation into IRS tactics found examples of “mismanagement and poor judgment,” but no evidence to support criminal prosecution. The Obama Justice Department announced in 2015 that no one at the IRS would be prosecuted. It said investigators found mismanagement but no evidence that the tax agency had targeted a political group based on its viewpoints or obstructed justice.
Greims, the Kansas City-based lead attorney on the class action case, told the Journal that while the Albuquerque Tea Party is not a part of the class-action settlement that will be spread among more than 400 plaintiff groups, it was among the earliest groups to protest their treatment by the IRS and that actually prolonged their tax status fight.
“Once you had the wrong kind of viewpoint, you were automatically put in a special section at the IRS,” Greims said. “It just builds on itself and that’s how it can take eight years.”
Republicans were disappointed earlier this year when the Trump Justice Department, under Sessions, said it would not reopen its case against Lois Lerner, who had led the IRS office that processes applications for tax exempt status.
Much of the agency’s leadership, including Lerner, resigned or retired over the scandal. One of the proposed agreements calls senior management “delinquent” in providing control and direction over the process. It faults Lerner for failing to tell upper-level management of the long delays in processing applications from tea party and other conservative groups.
“We hope that today’s settlement makes clear that this abuse of power will not be tolerated,” Sessions said in announcing the deal on Thursday.