Court orders IRS to provide information in tea party lawsuit

CINCINNATI

The IRS must produce information about tax-exempt applications for a tea party lawsuit that alleges the agency subjected conservative groups to additional, often burdensome scrutiny, a federal appeals court ruled Tuesday.

A three-judge panel unanimously rejected a request by government attorneys to block a judge's order to turn over information about applicants and chastised the agency for resisting such requests "at every turn."

Judge Raymond Kethledge of the Cincinnati-based 6th U.S. Circuit Court of Appeals wrote that the IRS wasn't entitled to keep secret in the name of taxpayer privacy "every internal IRS document that reveals IRS mistreatment of a taxpayer or applicant organization — in this case or future ones." He wrote that the tax code on taxpayer return privacy "was enacted to protect taxpayers from the IRS, not the IRS from taxpayers."

U.S. District Judge Susan Dlott in Cincinnati earlier this year approved class-action status for the lawsuit filed in 2013 by the NorCal Tea Party Patriots against the IRS and some employees in Cincinnati and Washington. The group alleges IRS violation of privacy law and its constitutional rights.

Kethledge wrote that the lawsuit's allegations "are substantial," including that groups on "Be On the Lookout" lists faced lengthy delays and "crushing demands" for additional information such as lists of donors, the content of speeches and presentations, details of activities and copies of newsletters, emails and advertising materials.

The Justice Department last year concluded an investigation by saying no IRS officials would face criminal charges over the tax-exempt applications. The IRS has said it has taken actions to improve handling of the applications, after a controversy that also had triggered probes by the agency's inspector general and in Congress.

An attorney for the California-based tea party group that sued said there are potentially hundreds of groups that could become part of the class action.

"We're very pleased and we hope that this will help break the logjam in discovery and help us continue our investigation into IRS misconduct," attorney Eddie Greim said after the ruling.

A request for comment from the IRS was referred to the Justice Department, and a message was left there Tuesday.