Carmen Velazquez v. Legal Services Corporation, United States of America, Intervenor-Appellee

al, VELAZQUEZ, et Carmen

Plaintiffs-Appellants, CORPORATION,

LEGAL SERVICES

Defendant-Appellee, America, States of

United

Intervenor-Appellee. 2020, Docket 98-6006.

No. Appeals, Court of

United States

Second Circuit.

Argued March 7, 1999. Jan.

Decided

759

LEVAL, Judge: Circuit appeal validity This concerns the of re- imposed the Le- strictions (“LSC”) Corporation gal on the Services of entities that fessional activities receive (“LSC grantees”). Plain- from LSC lawyers employed by City New tiffs are York clients, grantees, indigent private their LSC grantees, contributors to LSC and and state officials, public governments local whose con- grantees. sought tribute Plaintiffs to LSC injunction against the preliminary enforce- restrictions, contending they vio- ment of the provisions late various U.S. Constitu- preliminary tion. The district court denied injunction, finding plaintiffs had failed on mer- probability establish a of success part part. in and in its. We affirm reverse Background I. Corporation Legal A. Services and Challenged non-profit Statute. LSC is by government-funded corporation, created (Deborah Neuborne, York, New N.Y. Burt Legal Corporation Act of 1974 Services Goldberg, Rosenkranz and David E. Joshua (“LSCA”), seq., § 42 U.S.C. 2996 et “for Udell, Justice, for The Brennan S.. Center providing support financial for purpose of York, N.Y.; Fishbein Peter M. and New legal proceedings assistance noncriminal Fierman, Rothman, Scholer, Kaye Hays Alan persons financially or unable to matters York, N.Y., Handler, LLP, New On the & legal afford U.S.C. assistance.” Brief), Plaintiffs-Appellants. for 2996b(a). by this LSC fulfills mandate Lieb, Levine, Kronish, Weiner & Alan administering grants hun- making and Heilman, York, LLP, (Stephen A. New N.Y. organizations dreds local turn Ascher, Wieder, counsel), L. for Stephen 1,000,- legal assistance to between vide free Defendant-Appellee. 2,000,000 annually. indigent clients 000 and Legal Legal Aid v. See Texas Rural Services Preston, Stephen Deputy Assistant At- W. (D.C.Cir.1991); F.2d S. Corp., 940 (Frank General, Washington, torney D.C. W. (1996). Many Rep. LSC 104-392 2-3 General, Hunger, Attorney Assistant Wash- grantees by are funded a combination LSC Carter, D.C., Zachary United ington, W. private sources. S. funds and District of Attorney for Eastern States 3; Rep. A. A. LSC 104-392 York, N.Y., L. Brooklyn, Barbara Her- New governed local Boards Collette, Attorneys, De- wig and Matthew M. priorities in policies set and Directors who Justice, D.C., Washington, partment of and needs. response to local conditions client brief), Intervenor-Appellee. for empowered implement the LSCA LSC rule- through traditional administrative LEVAL, JACOBS, Before: Aid, Legal making process. Tex. Rural GIBSON,* Judges. Circuit F.2d at 692. program, LSC Judge part From the outset the LSC concurs JACOBS grantees have been restricted the use part separate opinion. in a dissents * designation. sitting by John R. Gibson of United The Honorable Circuit, Eighth Appeals States Court of 2996f(b)(l)-(10) litigating prisoners, seeking U.S.C. behalf LSC funds. in, alia, funds inter (prohibiting use to reform welfare.2 activities, proceedings, political most criminal question left no of its intention to involving nontherapeutie abor- grantees’ restrict use of non-federal and fed- desertion). tion, military desegregation, provides eral funds alike. The Act that while Recipient organizations barred from are also recipients may funds received “us[e] any activity using most nonfederal funds for Legal from a source other than the Services proscribed the LSCA. See U.S.C. assistance, ... Corporation provide legal 2996i(c). by recipi- expended such funds not be 1996, Congress substantially expanded any purpose prohibited by Act.” ents for grantees. the restrictions on activities of LSC 504(d)(2)(B). 504(d)(1) Moreover, § § re- Rescissions and See Omnibus Consolidated notify quires recipients to all non-federal do- 1996, Appropriations Act of Pub.L. No. 104- “may that nors their contributions (1996) 134, 504, 1321, § 110 Stat. 1321-53-56 any prohibited by ... expended purpose for Act”), (“OCRAA,” “the reenacted in or 1996 title.” this and the Omnibus Consolidated Rescissions 1996, August proposed regulations LSC 1997, 104-208, Appropriations Act of Pub.L. Revisions, which, implement (1997). to the 1996 inter 110 Stat. 3009 Section 504 of (1) alia, prohibited grantee “us[ing] a from OCRAA, pertinent part,1 set forth below any purpose prohibited non-LSC funds for bars the use of LSC funds to aid entities that Act,” by Fed.Reg. 41962 LSC 61 perform including lobbying, various activities (2) (1996); actions, prohibited any organization providing legal con- participation in class by categories, sup- grantee pursuing trolled a restricted assistance to aliens in certain (the porting advocacy training programs, organizations activities “interrelated collect- id.; laws, ing attorneys’ shifting prohibition”), Fed.Reg. fees under fee see 50 (12) appropriated supports training 1. None of the in this Act to that or conducts a funds Legal Corporation purpose advocating par- Services be used to a for of any person provide public policy encouraging political financial assistance to or ticular or a — entity activity, activity, boycott, ... a labor or antilabor a strike, (the picketing, a or a ... demonstration (2) issuance, attempts that to influencе the "training provision”); amendment, any or revocation of executive (13) (or claims), employee that claims whose order, regulation, general or other statement of retains, attorneys’ pursuant or collects and fees Federal, applicability by any and future effect any permitting Federal or State law or re- State, (the agency or local "executive branch (the quiring awarding of such fees “attor- provision”); neys’ provision”); fees ... (3) attempts any part any that to influence (15) participates any litigation on be- Federal, State, adjudicatory proceeding any Federal, person half of a State, incarcerated in a agency part proceeding or local if such (the prison or local "incarcerated client designed for the formulation or modification provision”); any agency policy general applicability (16) legal representation initiates or (the "agency adjudication and future effect participates any litigation, lob- other provision”); bying, rulemaking, involving or an effort to (4) attempts passage to influence the or system, reform a Federal or State ex- welfare any legislation, defeat of ment, referendum, constitutional amend- cept paragraph that this shall not be construed initiative, any or similar preclude recipient representing a an procedure a State or or local eligible seeking specif- individual client who is ( legislative "legislation body provision”) agenсy ic relief if (subsections (2), (3), (4) from welfare such relief collectively does not involve an effort to amend or other- "lobbying provisions”); challenge existing (5) wise in effect law on the attempts to influence the conduct of (the representation date of the initiation of the oversight proceedings any per- the [LSC] or provision"). entity receiving "welfare reform son or financial assistance OCRAA, 504(a)(2)-(5), (7), (11)-(13), (15)-(16). (the §§ Corporation oversight vided "LSC provision”); ... (7) legislation grant- 2. The participates 1996 also restricted LSC that initiates or in a class (the litigation activity involving political provision”); ees from action suit “class action ... 504(a)(1) (11)that redistricting, provides legal assistance for or and from (the abortion,” 504(a)(14). provi- respect "with [certain] alien[s] behalf of "aliens Plain- sion”); tiffs do not these restrictions.

761 (1985) plain granting as a motion different set of (defining “control” “the abili- 49279 enjoin preliminarily influence tiffs to enforcement ty [or] direction to determine policies” orga- management Legal of another the OCRAA Aid restrictions. See So (3) nization); re- applied ciety Legal Corp., the OCRAA Hawaii Servs. 961 (D.Haw.1997) (“LASH /”). any party to a F.Supp. third whom strictions funds, any grantee and to transfers LSC I LASH concluded under Rust v. Sulli van, private funds transferred from a irrespective the funds party whether third L.Ed.2d 233 (the “transfer of funds private or decisions,

were congressional on the restrictions provision”). Fed.Reg. federally-funded entities activities of were (1996). the regula- The combined effect of permissible only long open so as “left prohibit was to tions adequate [protected] speech.”3 channels activity, engaging restricted even standard, F.Supp. Applying at 1414. legally organiza- affiliate through distinct regulations found that court the LSC regulations promulgated in tion. These were unduly grantees’ protected burdened First 1610.3, §§ C.F.R. December See 45 associate, rights lobby, Amendment 1610.8 meaningful to have to courts. Central access analysis finding court’s was its Challenges to the Statute and Im- B. organizations prohibition interrelated barred plementing Regulations. filed this Plaintiffs grantees organi creating affiliate 1997, January alleging that the lawsuit engage zations that could in restricted activi on the of non-federal restrictions use monies I, ty. F.Supp. See 961 at LASH 1415-16. First, Fifth, rights violate their under implemented, The that as the court held 1996 Amendments to the United Tenth States only grantees to restrictions denied the They claimed also that Constitution. activity ability to undertake restricted direct on the of federal funds vio- restrictions use ly, but all channels for Amendment, also alternative exer First the doctrine of late the constitutionally protected cise of these activi Powers, Separation of and the Tenth Amend- ties. The court therefore determined that preliminary injunc- sought ment. Plaintiffs plaintiffs’ challenge likely constitutional was enjoin tion to on the of restrictions use prevail enjoined to on the merits and en non-federal funds. of portions forcement of the OCRAA restric filed, this after suit was before Soon tions. id. at 1421-22. hearing plaintiffs’ application for a injunction, cure thesе preliminary a federal order to constitutional infir- district mities, partially regulations” in in Hawaii an order LSC issued “interim court issued overlap providing] a method 3. there is referral abortion as of Because considerable between Second, presented family projects planning.” Id. Title X the issues contested in Rust and those by appeal, briefly opinion. encourage, promote, we review that could "not advocate family planning.” a method of Id. at abortion as brought plaintiffs The Rust a facial 180, Third, regulations Department by conditions attached project "physically vided X be that the Title must family planning Human Health and Services separate prohibited financially abortion provided X of services under Title the Public regulations set forth a nonex- activities.” Id. The 178-79, Act. at Health Service See 500 U.S. 111 factprs to whether clusive list of determine provided no S.Ct. 1759. The Act that Title X separateness requirement met. Id. at had been programs where funds "shall be used in abortion 178, 180-81, S.Ct. 1759. 111 family planning.” Id. is method rejected plaintiffs’ Supreme The Court view- statute). reg- (quoting challenged point and unconstitutional condi- discrimination provide opera- endeavored clear and ulations “to arguments. tions The Court concluded guidance grantees pre- about how to tional basis “has not discriminated programs Title X serve the distinction between merely viewpoint; has to fund one it chosen family planning.” as a and abortion method 193, activity exclusion Id. (internal to the of another.” quotation Id. at 111 S.Ct. 1759 rejected omitted). 111 S.Ct. 1759. Court unconsti- marks claim tutional conditions with observation regulations principal three condi- attached right has "not denied the en- grant funds for X tions on the of federal Title First, gage merely precluded [but] related activities projects in abortion projects. Title X were counseling concerning such out of "provid[ing] refused to fund activities the use family planning fisc.” 111 S.Ct. 1759. as a Id. at of abortion method Second, regulations pro- after the id while the Rust March 1997 modelled restrictions upheld by ‘degree separation’ in Rust. See 62 vided that “the of facil- (1997) (interim Fed.Reg. considered,” 12101-04 regu- the interim ities would be regulations “are intended to address consti- required separate lations “existence” challenges previous tutional raised Third, regulations facilities. Id. the Rust rule”); Legal Society Legal Aid Hawaii provided that the determination “whether a Corp., F.Supp. Services sufficiently sepa- recipient and affiliate were (D.Haw.1997) (“LASH II”); Velazquez v. Le- based on all ‘facts and circum- rate would be gal Corp., F.Supp. 332-333 Services regulations the interim stances’ whereas (E.D.N.Y.1997). regulations The interim statement, arguably im- made no such important earlier in two modified the rules plied satisfy separation [to rules] respects. LSC revised the transfer of funds recipient satisfy would have to each and ev- that, cases, rules so most non-federal ery program integrity factor.” Id. at 333-34. funds transferred to a con- expressed The district court some doubt as subject would trolled affiliate cease constitutionality regula- of the interim Compare Fed.Reg. the restrictions. delayed tions but nevertheless decision. Ob- 12101, 12103, § 1610.7 with 45 C.F.R. serving regulations,” are interim “these (1996X61 63752). Fed.Reg. 1610.7 might the district court determined that Equally important, a new section entitled provident judgment “be to withhold until the “Program Integrity Recipient,” 62 Fed. regulations promulgated.” final were Id. at 12103-04, 1610.8, Reg. provided 12101 at speculated “maybe 334. The court after relationship could maintain a argument today, we have this there will be organizations, “affiliate” which could in regulations,” more and therefore undertook engage long turn in restricted so as activities period some of time to let the “allow[] organizations the association between the get regulations.” settle until we final dust “program integrity.” met standards of Id. nonexclusive list of relevant factors (1) program integrity determination of were 21, 1997, May replaced the inter- On LSC (2) separate personnel; the existence of the (the regulations a “Final Rule” “final with im. separate accounting existence of time- and regulations”). id. As the district court See (3) records; keeping sepa- the existence of noted, program integrity revised sec- “[t]he facilities; rate and the extent to which virtually every tion eliminates difference be- signage distinguishes recip- identification and regulations tween the interim and the Rust ient from affiliate. Id. at 12104. regulations integrity respect requirements.” Id. at 335. The three differ- days pro- Ten after the interim rules were regulations ences between the LSC and the mulgated, hearing the court below held a regulations X approved Title in Rust noted plaintiffs’ preliminary the a in- motion for hearing- at the court the March were junction. F.Supp. See 985 at 332. The dis- Concluding that fi- eliminated. See id. the “although trict court that found based on the regulations represented permissible nal program integrity requirements,” Rust the Act, construction of the 1996 at see id. 338- regulations ap- interim differed from those 39, and were consistent with the First proved ways. Rust three Id. at 333. First, Rust, Amendment, the regulations, the in- district court determined LSC unlike regulations the and were not provisions .organizations cluded statute under subject likely the “control” of would be be invalidated and therefore denied restrictions, statutory injunction. preliminary the the motion for a unless gram integrity requirements appeal were met. See id. at 326-27.4 This followed. rejected plaintiffs’ ing challenge 4. The district court also due the unconstitutional conditions process protection challenges. equal "reasoning See id. [of with the observation that II, at 344. These claims have been abandoned on ]Rust controls the result here.” LASH 981 appeal. Legal F.Supp. part, at 'd in relevant Aid aff Society Legal Corp., Hawaii v. Servs. 145 F.3d The LASH court reached a result similar to the case, (9th (LASH III). Cir.1998) Among decision of the district court in this dismiss- 1017

763 Statutory A. Claim II. Discussion ' object final plaintiffs appeal, plaintiffs’ On We consider first contention inter represent an unreasonable regulations final unrea regulations constitute an Act, fail pretation and therefore 1996 interpretation of the Act. Plain sonable Re rules, Inc. v. Natural Chevron USA original under which tiffs claim that LSC’s Council, 837, 104 establishing sources precluded Defense Plaintiffs 81 L.Ed.2d S.Ct. purpose affiliates with the of under challenge constitutionality of activity, also taking fairly reflected the restricted regulations, arguing final Act and the statutory They text. maintain that the more they impermissibly grantees’ burden ex rules, final crafted after I held lenient LASH activities, con unconstitutional, of First Amendment ercise original conflict rules Stdlivan, of Rust trary to the command v. congressional Plaintiffs ask command. viewpoint-based constitute final unautho us to find that the rules are expression. statute, statute, restriction by the rized flexibility provided by the final without posture imposes appeal ‍​​​‌‌​‌​​​​​‌‌‌‌‌‌​​​‌‌‌​​​​​‌‌‌‌​​‌‌​‌‌​​‌‌‌​​​‍of this rules, Appellants’ is unconstitutional. See heavy this upon plaintiffs burden. Because Br. at 40. action, legislative we is a facial “any only determine whether there are need enjoys “the full of in measure prohibitions circumstances under which authority terpretive under the [LSCA]” permissible uphold Act are order interpretations the Act entitled to its States, F.3d Act.” Able United Texas Rural deference under Chevron. See (2d Rust, Cir.1996); see also Aid, Legal 940 F.2d 690. Under (plaintiffs “must establish standard, regulations upheld must be LSC’s under that no set circumstances exist directly “Congress spoken to unless has valid. fact that the Act would question has re precise at issue” and LSC regulations might operate unconstitution statute, contrary unless the solved circum some conceivable set of ally under “permissible regulation cannot be termed a wholly insufficient to render them stances is arbitrary or or is construction” of the statute (citation omitted). invalid.”) id.; Chevron, 467 U.S. at capricious. See 842-44, 104 be Plaintiffs’ is also increased burden Congress plainly in- injunction argue Plaintiffs preliminary the seek cause undertak- grantees from government. prelimi a tended bar LSC against the Grant of affiliate or- showing through activities injunction normally requires ing a restricted nary argument principally irreparable ganizations. This relies by moving party of harm the Act, 504(d)(2)(B) (1) provides the the which probability a of success on either may funds re- grantees sufficiently questions “use[] that LSC or serious merits Legal from a other than the case make them ceived source going to merits of Corporation provide legal assis- balancing of ground litigation, a for and a Services fair may not ... that such funds be decidedly except in favor of tance hardships tipping by any purpose for Brewing expended recipients moving party. See Genesee Co. (2d Co., by by Legal Services 124 F.3d this Act or Brewing hibited Stroh Cir.1997). According plaintiffs, this injunc Corporation Act.” preliminary But where plainly Congress’s de- language articulates sought against the enforcement tion is engaging in rules, prohibit grantees in govermnental may not the movant sire affiliate, through even activity an ground “fail- for restricted standard” voke By permitting non-federal funds. show of success.” See with but must “likelihood engage in to fund affiliates who Dairy grantees Foods v. Ames International Ass’n Cir.1996). final (2d argue plaintiffs, the activity, restricted toy, 92 F.3d us, abridgment lawyer-client relationship before addressed issues HI LASH challengе. unconstitutional conditions discrimination. Circuit did not address the claims based Ninth impermissibly allow funds to B. Constitutional rules non-LSC Claims “expended by recipients” prohibited Lawyer-Client Relationship. purposes. support claim to find Plaintiffs Plaintiffs contend that the Amendment First history, explains that legislative Congress interfering forbids with the legislation prohibits the use alterna- “[t]he lawyer “intense associational bond” between corporations provi- tive to avoid evade client, even when funds the S.Rep. the law.” No. 104-392 at 13 sions of relationship. Appellants’ Br. at 30. Plain final Plaintiffs contend allege provision, tiffs that the welfare reform grantees authorize to create af- rules —which attorneys’ lobby provision, fees and the and fund them with nonfederal mon- filiates ing provisions autonomy upon encroach “the eys allowing activity pro- them to conduct professional judgments” lawyers, of LSC purpose under the Act—facilitate a scribed rights. in violation of their First Amendment precluded by Congress, expressly and thus rely heavily Plaintiffs on dictum drawn step fail under the first of Chevron. There, from Rust v. Sullivan. persuaded. are not Nowhere in the We remarked, argued “It ... could be Congress speak directly statute does to the relationships traditional such as that question whether create and patient enjoy pro- between doctor and should support organizations. affiliate The Act does tection under the First Amendment not indicate whether transfer of non-feder- regulation, Government even when subsi- affiliate, by al funds to an or the dized the Gоvernment.” 500 U.S. at subsequent affiliate’s use of such transferred 1759. Rather than address the prohibited purpose, non-federal funds for a however, argument, the Rust court found “expend[iture] by recipi- constitutes an [a] doctor-patient relationship that “the estab- under the Act. conclude that ]” We Con- ente lished [was not] Title X gress spoken clearly regarding has not sufficiently justify encompassing all so as to grantees’ authority design and fund affili- expectation part patient an on the organizations, prong ate so that the first comprehensive medical advice.” Id. Because inapplicable. Chevron is patients Title X should be on notice that the scope subject of care received was to Con- accept We are plaintiffs’ also reluctant to limitation, gressional “all- “traditional” or regulations invitation to find that the final encompassing” doctor-patient relationship unauthorized, and that with- the statute could not be said to exist. Id. Plaintiffs unconstitutional, regulations out those be- interpret passage to extend constitution- favoring interpretation cause of the rule an protection doctor-patient al to the relation- preserves of a statute that its constitutionali- and, by ship, analogy, lawyer-client ty. Corp. See Edward J. DeBartolo v. Flori- relationship. Bldg. da Coast & Constr. Trades Coun- Gulf cil, 568, 575, argument unconvincing. We find the As a (1988); Hooper California, L.Ed.2d 645 v. matter, preliminary Rust did confer not con- 648, 657, 207, 155 U.S. 15 S.Ct. 39 L.Ed. 297 protection doctor-patient stitutional on the relationshiр. opinion only speculated relationship may protected find, moreover, We the final rules government regulation and expressly de- represent “permissible a construction” of the question. ques- clined to resolve the Id. The Act and therefore survive the second Chev- open tion left open was Rust and remains inquiry. legislative history ron While today. may give support some to the view that Congress prevent grantees intended to Nor need we resolve it here. Even if we creating “all-encompassing” lawyer- affiliates to undertake ac- that an restricted assume tivity, statutory point. enjoys relationship heightened protec- text is silent on the client regulations lawyer- We conclude that regulation, the LSC are tion from relationships not inconsistent with or unauthorized client funded are no LSC terms of “all-encompassing” doctor-pa- the Act. more than the

765 speech, X, rights association and protected of relationships under Title funded tient say plaintiffs, the undue of the final As burden in Rust. noted considered which were rules to an condi- always amounts unconstitutional above, limited the LSCA has through receipt of LSC tion on the subsidies. LSC legal services available range of 2996i(c). Indeed, § 42 grantees. See U.S.C. provide Three Court cases repre- historically limited their grantees have evaluating plaintiffs’ unconsti- framework for issues, typical- and are to selected sentations Regan tutional claim. v. Taxa- conditions of only a fraction the de- ly to meet “able 540, Representаtion, tion With 103 Overview their services.” See mand for 1997, (1983), S.Ct. 76 L.Ed.2d 129 Taxation (1996)(http:/Atsi.ncsAsc/about.html). LSC 4at (TWR), non-profit or- Representation With a lawyers are bound to ex- Because studying tax ganization devoted issues actual clients the plain prospective and reform, challenged lobbying for tax Sec- restrictions, by the 1996 imposed limitations 501(c)(3) Code, tion of the Internal Revenue lawyers unencum- refer clients to organizations engaged provided restrictions, there is no by the reason bered lobbying could not receive tax-deductible detrimentally rely on that clients will fear 501(c)(3). § I.R.C. TWR contributions. See range lawyers legal full their for a LSC 501(c)(3) § argued impermissibly condi- relationship lawyer-client services. deductibili- tioned the benefit of contribution therefore, “sufficiently cannot, be considered ty relinquishment on the First justify expecta- so an encompassing all as lobby. Taxation right Amendment See comprehen- part of the [client] tion on the Representation, With Rust, advice.” 500 U.S. at [legal] sive not an in- S.Ct. 1997. Because this was we Accordingly, need not S.Ct. “Congress discrimi- [had] stance where lawyer-client the traditional decide whether invidiously in its such a nate[d] subsidies enjoys protection, relationship constitutional danger- suppression as at the to aim Rust) (as relationship does such because ideas,” applied minimal scruti- ous Court practitioners operat- clients for exist ny upheld the law. Id. at 103 S.Ct. statutory ing challenged scheme. under (alteration quotation and internal plaintiffs provide ques- omitted). basis to Neverthеless, Nor do marks Justice validity itself. as noted, tion of the scheme Just Rehnquist’s majority opinion and a provide is entitled to limited Congress relied the fact that concurring opinion upon, X, under Title it is range 501(c)(3) of medical services organizations the I.R.C. allowed legal to offer limited menu services financially free independent but whol- to establish clear, for the LSCA. We think it exam- under ly lobbying under controlled affiliates I.R.C. legal ple, Congress could fund aid 501(c)(4) compromising eligi- their without practice specific limit its services office but bility id. at contributions. See deductible indigent representing the in land- such as opinion); id. at (majority disputes J., or in consumer fraud 552-53, (Blackmun, lord-tenant con- 501(c)(3) Act no The limitations of the 1996 cases. curring) (concluding alone simply defective]”). suspect because are de- more “constitutionally would be that are representations in terms fined Term, the invalidated a The next permit- prohibited rather than those that are broadcasting denying public condition federal find, therefore, was ted. We engage edito- funds to stations that scope legal power to limit the within its rializing. League Women F.C.C. services available under LSCA. Voters, 82 found L.Ed.2d 278 The Court Conditions. 2. Unconstitutional educational sta- because a “noncommercial contention is Plaintiffs’ second constitutional overall in- of its in tion that receives 1% program integrity rules contained Corporation for Public unreasonably come” from regulations the final burden (CPB) from Broadcasting be barred would grantee’s ability to funds to usе nonfederal no of lim- editorializing, activity. “ha[ve] Because each stations engage in restricted funds to iting all [their] Act the use of federal provisions of the 1996 burdens 766 . 501(c)(4) activities, and, In

noneditorializing impor- through more activities affiliate Voters, hand, League on the other tantly, [they using barred from even Women are] prohibition editorializing by on CPB finance ac- wholly private funds to editorial grantees was invalidated because the law left tivity.” Id. at 104 S.Ct. 3106. adequate pro no alternative avenue for the Congress could cure emphasized Court expression. tected by amending the statute it to allow stations organizations “to establish ‘affiliate’ Notwithstanding Rust’s considerable su- could then use station’s facilities edito- case, perficial similarity think it is to this we rialize funds.” Id. with nonfederal pertinent precedents. the least of these diminishing potential importance its Without Rust, Finally, in 111 S.Ct. grantees, speech in to some restriction (1991), recipients family planning- narrow; very nonetheless it was Rust was Title X of the Public Health funds under speech at with the values limited to odds challenged regulations prohibit- Act Services Congress seeking through was to advance its engaging in ing recipients Title X abor- grant program. As the not- referral, counseling, any and other activ- tion Rosenberger ed in v. Rector and Visitors advocating family a means of ities abortion as 819, 833,115 University Virginia, 515 U.S. Rust, ease, planning. in the as instant (1995), S.Ct. 132 L.Ed.2d 700 discuss- “program integrity” regulations required Rust, ing government “When the disburses facilities, separation personnel and records convey private funds to entities to any providers between Title X medical may governmental message, it ... ensure provider dispensing abortion information. message garbled nor its is neither dis- 180-81, See id. S.Ct. 1759. The Court grantee.” torted X can con- “[t]he observed that Title abortions, perform provide tinue to abortion- respects, In these Rust is unlike the services, engage in ad- related abortion present placed case. The restrictions here vocacy; simply required is to conduct those narrow; grantees they on not are ex through separate programs activities that are tremely prohibited broad. Grantees are out independent project from the that re- right engaging attempts to influence Title X funds.” Id. at ceives S.Ct. government’s adoption of Nor laws. does omitted). (emphasis part, For their justification prevailed in Rust— “employees pursue X ... Title remain free avoiding very the distortion or dilution of the abortion-related activities when are not government message pro advanced acting auspices X under the of the Title any gram bearing pro here. For this —have project.” Id. at 1759. Be- S.Ct. Rust, gram, unlike Title X in advanc “effectively prohib- cause were not ing particular might set of values that engaging protected ... it[ed] speech if diluted or distorted the forbidden federally scope conduct outside the permitted. simply were Here has program,” funded this circumstance was dif- organizations chosen to rule that which ac League ferent from that considered cept LSC funds to finance their activities Voters, there no Women was unconstitu- engage types shall not of activities. Id. at tional conditions violation. compels We do not think Rust the conclusion program integrity rules on modelled governing necessarily X allow those Title Taking together, these eases we infer adequate protected expression avenues for that, circumstances, Congress in appropriate statutory or factual contexts where the bur may rights burden the First Amendment may speech significant den on be more recipients government if the re benefits relationship where between the burden cipients adequate are left with alternative and the benefit be more expression. protected channels for Section attenuated. 501(c)(3)’s prohibition lobbying in luxa Representation permissible tion With was Our conclusion that the First Amendment organizations receiving speech the bene influ- because tolerates this restriction lobbying by Representa- deductibility fit of could undertake enced more Taxation With

767 ients, lobbying prove unduly burdensome inade- the restriction in and approval of tion’s 501(c)(3) by sug- justified, organizations quately and the with the result that the by § Voters the League Women regulations suppress Act and will 1996 the gestion of by editorializing grantees prohibition impermissibly speech CPB the of certain funded acceptable if law al- organizations lawyers. may have the and would been their And it contend, for adequate be, them alternative avenues plaintiffs program lowed as the by the through affiliates than expression requirements may integrity prove especially Nonetheless, holding of Rust. Rust is consis- legal of burdensome the context services. cases, support and with tends tent these are unable to We assess these contentions program consid- suggestion that the we us, their sparse the record and we need not before chal- can at least a facial here withstand er appeal. Any them to assess decide restrictions on the lenge despite its broad capable demonstrating that the grantees. speech unduly 1996 restrictions in fact burden its engage protected Amend- capacity First that, notwithstanding Plaintiffs contend activity bring free to an as- ment remains eases, authority Act is of these the 1996 challenge plain- Act. applied to the 1996 But “immensely They point unlawful. present support evidence to their ‍​​​‌‌​‌​​​​​‌‌‌‌‌‌​​​‌‌‌​​​​​‌‌‌‌​​‌‌​‌‌​​‌‌‌​​​‍tiffs little integrity program requirements wasteful” predictions regarding seriously how the 1996 offices, and equipment, libraries separate grantees generally, affect Act will grantees must meet in order personnel that concluding pro- provide no basis' for that the Appel- through affiliates. speak to be able integrity in at gram applied rules cannot be allege at Plaintiffs lants’ Br. 37. unduly interfering some cases without least although program integrity revised rules — grantees’ Amendment with First freedoms. virtually approved in Rust5 identical to those appears likely It that LSC with “extraordinary” im- —impose burdens provide substantial non-federal can exercising impеde grantees from permissibly range through activity the full of restricted rights First Amendment to associate their incorporated separately affiliates ser- Id. clients, without lobby, litigate. and to with difficulty. have ious Plaintiffs therefore compliance, they argue, sub- are “so costs of no set circum- failed to “establish that prohibitive. Appellants’ as to be stantial” exists under which the Act would be They argue that the stances Reply Br. at 18. further valid,” and so their facial must justification in Rust for requiring substantial Rust, rejected. program recipient separation between Salerno, United States (quoting 481 weak- 1759 avoid risk of affiliate —to 739, 745, 95 L.Ed.2d 697 garbling government’s mes- U.S. ening or (1987)). here, as sage present —is using grantees to a mes- is not its advocate Viewpoint Discrimination. We turn Thus, argue, no there is sage. plaintiffs Act finally plaintiffs’ claim that the 1996 sepa- justification requiring degree against speech certain discriminates in Rust. upheld of affiliates that was ration is unconsti- basis of therefore applied even as to the use of federal in- tutional plaintiffs’ allegations find that are We appears plaintiffs It direct this challenge. It monies. sufficient sustain facial against lobbying be, argument provisions may plaintiffs urge, as that the will, provision the Act.6 recip- the case and the welfare reform integrity rules of some every separation regulatory respect, the burden 5. Under X and the 1996 Act almost both Title III, schemes, grantee provide activi- restricted under two schemes. See LASH identical provider regulations (noting if is dis- "[t]he ties the restrictеd sendee F.3d at 1024 (2) sepa- tinguished separate personnel; preserve distinc- promulgated LSC to records; (3) physical separation; accounting organi- rate between and unrestricted tion restricted (4) signs sepa- other outward markers regulations nearly are identical zations Compare Rust"). C.F.R. ration. 1610.8 upheld in 1993). (suspended Under both C.F.R. schemes, 59.9 suggests plaintiffs' redis- also 6. The brief the funded and restricted whether imper- provision tricting provision and abortion sufficiently separate grams determined on 1610.8(3); viewpoint. missibly basis case-by-case discriminate on the basis. See C.F.R. above, Rust, 180-81, Appellants noted how- Brief for at 27. As S.Ct. 1759. lobbying provi provision similarly branch respect to the The executive With sions, grantees “attempt[ing] influ- misplaced. claim is The classifica forbids from to issuance, amendment, provisions tion these is based ence the or revocation established order, matter, subject viewpoint. any regulation, think of executive or other on We general Congress may applicability discriminate on statement of and future it clear Federal, State, subject by any agen- or local grantees’ of the matter of effect basis 504(a)(2). cy.” interpret §at this expression, because such discrimination Id. We program] provision to a limitation on properly the LSC define “confine[s content, favoring policy continuity legitimate purposes for which it without limited and change discriminating Rosenberger, created.” 515 U.S. at over or otherwise was lobby any against viewpoint. language find that thе In the of 115 S.Ct. 2510. We thus Rust, provision suppress ing restrictions constitute valid limitations on does not ideas merely project grantee ... scope program. prohibits but “a of engaging pro- from in activities outside the legislation provision, example, The re- ject’s scope.” grantees “attempt[ing] from to stricts LSC any legis- passage influence the or defeat of lation, amendment, referen- constitutional provision The welfare reform of dum, initiative, any procedure of or similar 504(a)(16) is more obscure. It includes legislative or a State or local categories prohibited four activities “in 504(a)(4). OCRAA, body.” lan- While this volving an effort to reform a Federal or State guage imposes sweeping restriction on system” initiating legal representa welfare — grantee activity, particular it burdens no tion, participating litigation, lobbying, in viewpoint speech sup- in and favors neither rulemaking exception relating or an —with port legislative speech opposed. action nor legal representation litigation prohibi or prohibits from “at- Because reading tions. Under the most natural tempting] passage to influence the or de- ” provisions, appear each of these three legislative of a or constitutional initia- feat prohibit type activity regard named tive, prohibition applies regardless viewpoint, might less of while one be read prohibited activity whether the would have activity only prohibit the when it seeks re sought change opposed change. form. operates only to vision restrict LSC-funded lobbying respect legisla- from entities litigation prohibition clearly view- decisions, regardless viewpoint. tive point grant neutral. It denies funds to an agency adjudication provision entity any way, ... “participates similar- in ly litigation involving ... an “attempt[ing] restricts effort to reform 504(a)(16). any part any adjudicatory pro- system.” Litigation ... influence welfare Federal, State, sides, any ceeding agen- or local definition has at least two and one cy proceeding designed litigation regardless part “participates” if such for the formulation or modification of which side one is on. If occurs agency policy general applicability “involving an a ... effort to reform welfare 504(a)(3). per- system,” “participates” §at in it future effect.” Id. We one whether one nothing language seeking ceive that burdens is on the side reform or the side another; opposing prohibit- than the re- it. are therefore one more Grantees permits grantees participate litigating ed not in an effort to striction rule-creating adjudicatory system, from inter- neither side of reform welfare but also Rather, proceeding. provision permissi- vening filing litiga- in such amicus briefs bly grantee program activity away opposition proposed channels tion reforms. We adjudicatory prohibition policymaking in a view- therefore conclude that the basic point-neutral participating litigation involving an ef- manner.

ever, plaintiffs provisions validity properly did not these their are not before us. below, arguments challenging in the court and so Second, system viewpoint fort to reform a welfare is provi to read the welfare viewpoint neutral. sion as biased would render it un above, constitutional. As we supra noted see apply to same considerations the courts should be reluctant to read “lobbying” “rulemaking” hibition on “in- statutes in a manner that renders them un volving an effort to reform a ... welfare constitutional. If reádings possible, two are system.” “participates” lobbying One preserve the one that would the statute is rulemaking “involving an effort to reform” generally preferable. See Edward J. DeBar participation supports op- whether one’s Corp. tolo v. Bldg. Florida Coast & Gulf poses the reforms under consideration. Council, 568, 575, Constr. Trades 485 U.S. (1988); 108 S.Ct. 99 L.Ed.2d 645 Hoo disqualification entity of an that “initi- per California, legal representation ates ... involving an 207, 39 L.Ed. 297 effort ... system” to reform a welfare is We are therefore constrained to read the perhaps reading less clear. One of this basic provision limitations of the welfare prohibit only clause seems to efforts aimed 504(a)(16) prohibitions as neutral person reform. A oppose who intended to activities, specified on regardless wheth- might by reform not see himself as covered er the activities are promote undertaken to prohibition activity “involving on an effort to reform or to defeat it. interpretation, reform.” On another statute support could be read to cover both is, however, There specifica another opposition to reform. inter- Under this provision tion in the inescapa welfare that is pretation, person if making some other an (a)(16) bly viewpoint-biased. Subsection ex system, effort to reform the welfare one who pressly provides prohibitions that its do not legal representation initiates a to intended prevent grantee representing “an eli oppose engaging activity that effort is gible seeking specific client who is relief from concerns) (i.e., involves an effort to reform a agency welfare if such in relief does not system. volve an effort to amend or otherwise chal lenge existing law in effect on the date of the if it linguistic Even involves some to strain (the representation” initiation “suit- provision way, read the per- two factors According exception”). for-benefits to this (a)(16) First, suade us to do so. subsection exception, representation seeking of a client long on welfare reform string is one of a permitted, a welfare benefit is but if the prohibitions activity related to reform ef- representation any challenge will not involve All clearly expressed forts. the others are propriety previously existing to the activity manner bars on either side of rule that led to the denial of benefits. The that, unlikely respect the issue. It is with argue thus could not the rule alone, Congress welfare and welfare intended that led to denial of the client’s benefits only pro-reform activity to bar oppo- and not by governing regula was unauthorized provision sition to reform.7 If the welfare tion, regulation was unauthorized prohibit only activity were read to statute, regulation or that the or statute sought activity reform and opposed was unauthorized the Constitution. Such it, this would mean that had acted representation permitted only if it includes respect inexpli- welfare in a manner challenge underlying no law. cably at with the law’s numerous variance parallel provisions. It makes far better It seems clear to us that this limitation on sense, permit, if the words of the statute exception suit-for-benefits is not view- interpret provision the welfare point as consistent neutral. It accords to those provisions. with those represent making any who without clients possibility Burton) ("The Rep. fighting This is rendered all the more unlike- ment of LSC is ly by legislative history the fact that the shows a plan Why welfare reform Wisconsin.... particular congressional concern block LSC taxpayers’ being fight very dollars used to grantees Cong. opposing welfare reform. See 142 things important?”). we think are 1996)(state- (daily July Rec. ed. H8179 law, explanatory existing language opinion, but in the Rust rules of denies quoted by representation challenges was it to those whose Finley: existing dearly discourage It rules. seeks provision

challenges quo. status can, violating without The Government viewpoint, basis of Constitution, thus discriminates selectively fund requires us to decide whether this dis- interest, ... it believes to in the the permissible crimination is in context of without at the time an alter- same the LSCA. program native which seeks to deal with way. doing, in problem another In so government’s “[discrimination not on the Government has discriminated against speech message” because of its is merely viewpoint; of it has cho- basis suspect Amendment. Ro under First activity fund of sen to one exclusion senberger Rector and Visitors Universi v. of the other. 828, 819, ty Virginia, 515 U.S. 115 S.Ct. of Rust, 193, 1759; 500 U.S. 111 S.Ct. see (1995) 2510, that (noting 132 L.Ed.2d 700 Finley, also at 2168. “presumed is to be un such discrimination analysis, Judge just as constitutional”). Under Jacobs’s subsidy Whether a that is may lawfully Congress family planning fund illegal constitutes dependent on grantee’s on the not services conditioned complex question, presents a discrimination abortion, counseling availability on the so which is illuminated three relevant recent Congress legal representa- also fund holdings. Supreme Court applicant tion of a welfare on the conditioned Sullivan, 173, In Rust v. 111 S.Ct. U.S. grantee’s arguments raising ques- not that 1759, (1991), up 114 L.Ed.2d 233 the Court statute, validity tion regulation regulations forbidding recipients gov held governmental procedure pertaining wel- to family planning ernment funds for fare. advocacy counselling to related abortion. acknowledge We from Rust words 203, id. at S.Ct. 1759. Judge that Jacobs cites seem on their face to In National Endowment the Arts for support his view. But we that these doubt — -, 2168, Finley, 118 S.Ct. reliably In words can be taken at face value. (1998), the up- L.Ed.2d 500 last term judicial seeking prece- a to understand how NEA, making- that in requirement held relatively unexplored dent in a law area of excellence, grants for the arts based on also questiоns, bears on undecided general “tak[e] into consideration standards often more instructive to look what the decency respect the diverse for beliefs done, Court has rather than at what the Finley, people.” and values of the American explanation. Explanations Court has said 118 S.Ct. at enough seem sound in the context Rosenberger, the Court struck down a carry facts for which are devised often governmental provision in a implications the court would never subscribe grants publications to support student if applied contempla- to not in other ‍​​​‌‌​‌​​​​​‌‌‌‌‌‌​​​‌‌‌​​​​​‌‌‌‌​​‌‌​‌‌​​‌‌‌​​​‍facts eligibility publications excluded from ex (6 tion. Virginia, See Cohens v. 19 U.S. pressing viewpoint religion. See Rosen (Mar- Wheat.) 399, 5 L.Ed. 837, 115 berger, 515 U.S. at S.Ct. 2510. C.J.) (“It maxim, shall, is a not be disre- garded, these prece- general expressions, every We assess the relevance of differently dissenting opinion, dents our col- are to be taken connection with league. Judge argues expressions Jacobs Rust and case which those are used. case, Finley government’s beyond If together they go they may establish respected, ought judg- broad entitlement to on the but discriminate ba- not control the very viewpoint making grants. subsequent sis financial ment in a suit when Viewpoint discrimination, decision.”); argues, point presented he is sus- for United (2d Cir.1979) where, Rubin, pect Rosenberger, gov- as in States v. 609 F.2d (“A J., promote diversity pri- (Friendly, concurring) judge’s power ernment seeks to speech. Judge heavily vate Jacobs relies bind is limited to the issue that is before him; he cannot transmute diсtum into deci- our First Amendment values.” Texas v. by waving Johnson, uttering sion a wand and the word CBS, ”); Soc’y ‘hold.’ Inc. v. American 105 L.Ed.2d 342 Criticism of official cf. Publishers, Composers, Authors & 620 F.2d policy speech is the kind of oppres- an (2d Cir.1980) J.) (Newman, 934-35 sive would sup- be most keen to (“[T]he judicial opin- safer course is to read press. It speech liberty is also for which deciding only they purport ions as what preserved guarantee must be freedom of decide.”). political choice to people. For those that, reasons we think it clear notwithstand- Rust, quotation example, ing Rust’s semantic endorsement of Con- on its imply seems face to gress’s right activity to fund one to the exclu- lawfully study could fund institutions to another, sion Court would foreign policies, nation’s or domestic condi- approve grant study governmental grantee’s tioned on the criticizing, or policy, grantee’s conditioned on the not criti- in, advocating change policies gov- the of the cizing policy. the parame- ernment. That fall would within the choosing activity ters of “to fund one to the view, lawyer’s In our argument a to a court [anjother.” Congress exclusion of would be statute, rule, that a governmental or practice “selectively fundpng] a ... it be- standing in the aof client’s claim is interest, public in lieves be the without at illegal unconstitutional or otherwise far falls funding pro- the same time an alternative closer to pro- the First Amendment’s most gram problem which seeks to deal with the categories tected speech than abortion Nonetheless, way.” in another we think it counseling or indecent аrt. The fact that Supreme inconceivable that the Court that Congress can grants family make that favor approved regulation the Rust would have in- abortion, planning over or that decency favor language tended its grants authorize fund- indecency, way suggests over in no that Con- for, ing of, support barring gov- but criticism gress grants legal also make to fund the policy.8 ernmental representation applicants of welfare under attorney terms that bar the arguing from

We the in the think resolution lies unconstitutionality illegality types fact that different or speech enjoy dif whatever rule blocks the degrees protection Among ferent client’s success. under the First only directly “Expression ways oppose Amendment. effective a issues stat- ute, always regulation highest rung policy adopted by govern- ‘has rested on the or of the ” hierarchy argue jurisdic- having of First Amendment ment is to a court values.’ Co., NAACP v. Claiborne Hardware 458 U.S. tion of the matter that the rule is either 886, 913, 3409, 102 S.Ct. 73 L.Ed.2d 1215 unconstitutional or unauthorized law. (1982) Brown, (quoting Carey v. 447 The excep- U.S. limitation on the suit-for-benefits 455, 467, 100 prohibits S.Ct. 65 L.Ed.2d 263 tion legal organization services (1980)). strongest protection of the grant has received LSC from funds First speech guarantee making Amendment’s free argument such an on behalf of a goes right government client, to criticism though argument may even be change in governmental policy. necessary advocate rights to establish the client’s “[Expression poli of dissatisfaction with precisely representation for which the country cies of this grаnted.9 [is] situated at the core of was a restriction Such is a Concurring judgment Finley, in the Regan Representation, Justice v. Taxation with 461 U.S. 540, 550, argue Scalia did can allo- 103 S.Ct. 76 L.Ed.2d 129 libitum, (1983)). cate subsidies "ad insofar as the First Finley, is Amendment concerned.” S.Ct. at 118 J., (Scalia, concurring judgment). 2184 agree Judge This 9. We do not Jacobs’ view that Justice, position joined by only merely lawyers was one prohibits taking the statute majority however. The representations. practical left no doubt that the on certain As a mat- ter, application First context,” subsidy lawyer Amendment "has in the often will not know in advance subsidy arguments id. at what "aim[ed] must be raised to counter those suppression dangerous opposition prog- ideas” would raised as the Amendment, (quoting violate the First Judge id. at 2178 We resses. think furthermore that Jacobs of the part question next is ‘certain “calculated to drive to those close kin ” invalid as a result be found should statute marketplace.’ viewpoints from ideas unconstitutionality viewpoint-based' of the (quoting & Simon Finley, 118 S.Ct. exception. the suit-for-benefits proviso to Schuster, State New York Inc. v. Members of for invalida- likely candidates most The four 105, 116, Bd., 502 U.S. Crime Victims (2) Act; (1) the entire the entire tion are (1991)). If the L.Ed.2d S.Ct. reform; (a)(16) to welfare relating subsection unconstitutionality or question idea (3) exception; the entire suit-for-benefits rule, the court- governmental illegality of a attorney (4) an proviso to the effect expo- prime marketplace for room is may not chal- a client’s benefits suing for Aaron, 358 Cooper v. that idea. sure of Cf. existing law. lenge 1, 18, L.Ed.2d 5 federal principle (stating the “basic the first quickly conclude We exposition in the judiciary supreme “A go too far. court possibilities and second Constitution”). lawyer To forbid invalidating of [a] law of more refrain should in the articulating necessary.” that idea court Alaska Airlines statute than is 678, 683, 107 effectively Brock, idea from the drives the ceeding (1987) (internal effectively quotation marks it can most marketplace where L.Ed.2d 661 omitted). view, restric In our without offered. in a tion, “function Act will still the 1996 Finley discussion Court’s of Con with the intent consistent manner limita- suspect nature of the underscores (emphasis at 107 S.Ct. gress,” id. exception for a tion on the suits-for-benefits omitted). unconstitutionality finding of Our of Finley, considerations further reason. in the stat only tiny restriction one affects merely to be respect” were “decency and ute, continue to function can otherwise which Supreme “into consideration.” taken (a)(16) can also con intended. Subsection as questioned provision stressed that “involving an effort to bar activities tinue to “im- “vague exhortation[s]” offered system,” Congress as a ... welfare reform Id. 118 requirement.” categorical no pose[d] intended, provi without the unconstitutional might still The NEA 2177. sion. indecency. notwithstanding grants make question is whether The more troublesome fact, Court, imply to that an in seemed should viewpoint-based restriction invalid “calculated the sort prohibition, of absolute invalidity the entire suit-for- in the of result viewpoints from the or drive ‘certain ideas proviso exception, only of benefits ” required a differ- have marketplace,’ would legal repre- a in the course of grantee a bars (internal cita- Id. ent result. argu- eligible from of an individual sentation omitted). on the suit-for- The limitation tion any existing ing challenge to amend or law. just absolute such an exception is benefits argument recognize a reasonable We recipients from grant It prohibition: muzzles opposed is intent the Act so overall of any arguments. expressing and all forbidden Congress intent of challenges to law that the striking down the served would be better reasons, that the suit- we believe For these exception than al- entire suit-for-benefits exception is discrimi- for-benefits a lawyer representing client lowing grantee a subject First Amendment to strict nation existing rule invalidity any argue arguments offer no scrutiny. Defendants law. scrutiny why provision can survive such hand, legis- complex con- therefore perceive none. We other because and we On the amalgam of different exception represents an lation clude that the suit-for-benefits might 504(a)(16) compromises, one see unconstitutionally viewpoints restricts free- § exception as an inten- grant- it a the suit-for-benefits speech, as restricts dom of insofar recog- one applicant, provision, more measured ee, tionally a seeking for welfare relief represen- lawyer in the nizing engaged a existing law. challenging prejudice to the client that lawyer can which a underestimates may with overstates eаse such a withdrawal. progress result that is in withdraw from arguments a client must make the to function tation of as written. will be Grantees (on necessary penalty to secure the relief their client barred losing their entitlement status) proviso as drafted does not for- from engaging any seeks. grantee lawyers challenging prohibited by § all They bid activities will 504(a)(16) prohibited that were in existence at those be under from initiat- laws— representa- ing legal representation, the initiation of the participating the time of Thus, notwithstanding hostility litigation, lobbying, tion. its or rule- reform, litigation seeking legal making in- concerning [by anyone] “effort[s] tentionally challenges permitted to law the reform a Federal system.” or State welfare representation long hand, context individual so On the other permit- will be passed represent as the addressed law after ted to “an eligible individual client representation. seeking specific the initiation of the who is relief from a welfare agency,” regardless represen- whether such Because it is unclear which alternative bet- arguments tation includes seek “to Congress, ter out the intent carries we amend or challenge existing otherwise law.” possi- think it to invalidate the best smallest 504(a)(16). statute, portion excising only ble viewpoint-based proviso rather than the en- Conclusion exception part. it tire which is This The district preliminary court’s denial of a guid- conclusion follows Court’s injunction solely respect reversed ance that “[u]nless is evident that the limitation on the excеp- suit-for-benefits legislature would have enacted those 504(a)(16). respects, tion of In all other power, indepen- visions which are within its denying the district court’s prelimi- order not, dently part of that the invalid injunction nary is affirmed. dropped fully opera- if what is left is Valeo, Buckley tive as law.” JACOBS, Judge, concurring Circuit 46 L.Ed.2d 659 part, dissenting in part: (citation quotation and internal marks omit- agree majori- I ted); Time, Inc., the conclusions of the Regan v. see also 468 U.S. ty opinion except 641, insofar as it holds unconsti- 104 S.Ct. 82 L.Ed.2d 487 (1984) (“[T]he proviso tutional a critical in a subsection of presumption is favor of the Omnibus Consolidated Rescissions and severability.”). We thus conclude that (“OCRAA”), Appropriations Act of 1996 viewpoint-based proviso barring grantee law- 104-134, 504(a)(16), § Pub.L. No. 110 Stat. yers representing contesting individuals from (1996). 1321-55 to That 1321-56 sub- legality existing of an rule is severable section exception. the overall suit-for-benefits (i) exception permitting “rep- Legal Corporation denies Services (“LSC”) eligible an individual any entity ] client [w]ho “that initi- resente seeking specific from a agency” legal representation relief ates participates welfare holding will survive our viewpoint- any litigation, lobbying, other proviso based excep- rulemaking, involving suit-for-benefits an effort to reform a tion is unconstitutional. Federal system,” or State welfare (ii) exception repre- creates an for the We therefore direct the district court to eligible sentation of “an individual client injunction preliminary enter a barring en- seeking specific who is relief from a wel- part forcement of that of the suit-for-benefits agency,” fare 504(a)(16) exception §of that would make an (in) subject proviso however to the entity if, ineligible grant for an LSC in the taking bars LSC eases that representation course of a of an individual “involve an effort to amend or otherwise seeking specific client relief from a welfare challenge existing law.” agency, entity sought “to amend or oth- challenge existing erwise law in majority effect on the The throws section out of kilter date representation.” of the initiation of the by preserving exception striking but respects, In all other proviso, ground the statute continue will on the that under Rosenber- 774 (cid:127) “fee-generating” See No cases. University Rector & Visitors

ger v. (1994). 2996f(b)(l) § U.S.C. 115 S.Ct. 515 U.S. Virginia, (1995), proviso amounts L.Ed.2d (cid:127) 42 U.S.C. felony cases. See No viewpoint discrimination. (1994). 2996f(b)(2) §. because: respectfully dissent I (cid:127) challenging a criminal civil No actions (A) helps specify 2996f(b)(3) proviso, § 42 U.S.C. conviction. See recipi- grant type representation undertake, Congress’s part of ent (cid:127) a nonthera- seeking procure “to cases No necessary- entirely appropriate —and 42 U.S.C. peutic abortion.” See in a available the services specification 2996f(b)(8)(1994). § created. program it (cid:127) desegregation See cases. No school (B) successfully majority has not 2996f(b)(9)(1994). § U.S.C. viewpoint of a disfavored identified (cid:127) Military involving Selective No cases To the any public forum. person seq. § Act, 451 et App. U.S.C. Service funds a “view- legislatiоn extent that 2996f(b)(10)(1994). § See U.S.C. all, advocates the it is one that point” at (cid:127) See involving suicide. No cases assisted to claimants. delivery of welfare benefits 2996f(b)(ll) (West Supp. § 42 U.S.C.A. 1998). Program A. Definition (cid:127) (or activity) regaining litigation No program, Con- creating taking of a manner of timing or “the goods and specify the can course gress 504(a)(1), § census.” See OCRAA goods and the provided will be services at 1321-53. Stat. In so that will be excluded. and services (cid:127) litigation. id. permitted to fund No class action Congress is doing, 504(a)(7), at 1321-53. constitutionally protected 110 Stat. of some exercise Sullivan, See Rust rights, but not others. (cid:127) classes of to certain legal No assistance 1759, 1773, 194-95, 504(a)(ll), 110 Stat. id. aliens. See (1991). Although Rosenber- 114 L.Ed.2d 233 1321-55. 1321-54 to power to fund government’s ger curbs the (cid:127) incar- litigation No on behalf someone others, viewpoints to the exclusion some 504(a)(15), 110 Stat. cerated. See id. gov- operates only when the that limitation 1321-55. public forum for a limited ernment creates (cid:127) being persons on behalf of No A expression viewpoints. of diverse selling housing for public evicted from Corporation is Legal grantee of the Services 504(a)(17), at § 110 Stat. drugs. id. See in a or the public participant not a forum 1321-56. to contrib- in which it is invited public forum correctly rejects the majority opinion The view; fur- point of it is contractor ute its a plaintiffs challenges that constitutional wants nishing services program-shaping of these make to several resembles the in that provided, and (re- Majority [page 764] at provisions. See Rust, and X funds recipients of Title in fеe-gener- challenge prohibition jecting carry myriad that out private agencies of the (rejecting eases); [pages 764-67] at ating id. limit- that have government programs all the challenge to condition unconstitutional purposes. specified ed restrictions). § 504 Authority Statutot'y 1. 504(a)(16)imposes— The restriction money political to fund on the use of LSC purpose of the LSC inception, the From its policy an- concerning welfare agitation for client services to fund individual has been —is types Congress to by ‍​​​‌‌​‌​​​​​‌‌‌‌‌‌​​​‌‌‌​​​​​‌‌‌‌​​‌‌​‌‌​​‌‌‌​​​‍define 42 other effort legal problems. with See indigent persons may provide (1994). LSC years, Con- services Over U.S.C. funds government’s all the and to channel shaped the kind of has and clarified gress (without cases, displacement) and, substitution in some legal services exception no others. services and may those recipients grant fund: its advocacy arguments may in given for suits to collect welfare bene- what needed a fits, proviso barring expen- limited representation. Majority [page as See at 771 n. law, existing challenge however, serves the challenge, ditures Since this is a 9]. facial purpose operates way. in the same same may this Court not base its invalidation of hypothetical this statute on a set of circum- (as proviso on welfare stances, one it even believes will “often” oc- believe) majority appears an effort to (Plaintiffs Majority cur. [page at 762] arguments weed out a certain class “must establish that no set of circumstances lawyers appear. cases in which LSC-funded valid”) exist under which the Act would be contemplates The statute nowhere or re- Rust, (quoting 500 U.S. at 111 S.Ct. 1759 quires lawyer appear that an LSC-funded added)). Moreover, (emphasis majori- as the a ease in he or she which must forbear from out, ty points the LSC does not a fund challenging a welfare statute meritorious traditional, all-encompassing lawyer-client re- contrary, grounds; constitutional lationship. always operated It has under says lawyer grantee may proviso that a significant restrictions, required and it is representation not take on such a in the first prospective advise clients of these limitations. place. nothing There is remarkable about So there is therefore “no reason to fear that Lawyers representa- often turn down this. detrimentally rely clients will on their LSC fulfill, cannot either reason tions lawyers services,” range legal for a full (such availability of conflict or otherwise as Majority 764], [page help at such as resources, expertise). of time and or lack of mounting a Constitutional to a wel- example, public lawyer For a interest cannot fare statute. job against file a claim for discrimination a agency organized rep- charitable she or has Supreme Authority resented; lawyer repre- a interest face, senting plaintiff pressing a On its this statute funds a who is for school services, expected provides certain and the re- vouchers cannot be to take on a 504(a)(16) (together striction found in representation argument that entails the exception proviso) prohibits grant- its and its illegal school vouchers are or unconstitution- authorizing legislation rendering ees from that fall al. The LSC’s as well services outside legal prohibit lawyer scope program. as rules of ethics a recognized power undertaking representation a that Court has undoubted Rust, lawyer pursuing would be to do this. See at barred 192-94, 1771-73; potentially argument.1 fruitful avenue of A 111 S.Ct. Harris v. (or McRae, lawyer employed by grantee) ethically obliged case, L.Ed.2d to decline such a lawyer the client to a refer who can Rust, the Court considered a section of it, Velazquez Legal Corp., handle see Seros. prohibiting the Public Health Service Act (E.D.N.Y.1997), F.Supp. and in appropriated family-planning use of funds instances, some the client will be referred to programs “in services where abortion is Majority entity, [pages an affiliated see Rust, family planning.” method of 500 U.S. 761-62], (quoting at at S.Ct. 1764-65 300a-6). majority argues “practical upheld The that as a The U.S.C. Court the attorney constitutionality matter” an prohibition will “often” not know of that because it 2996e(b)(3) (1994) (requiring (noting may agree 1. See 42 U.S.C. that a "client be not asked to representation scope the LSC to that the "ensure” activities it finances to a so limited in as to 1.1”); attorneys' ("Repre- are carried out in accordance with violate Rule id. Rule 1.2 cmt. 2296f(a)(l) obligations); through legal agency provided ethical 42 U.S.C. sentation aid (1994) Corporation subject (requiring may types the to "insure the be to limitations on the оf handles.”); 1.16(a)(1) highest quality agency maintenance of the of service and cases the id. Rule standards”); professional (barring attorney taking Model Rules case that would of Profes- (1995) rule); (requiring sional Conduct Rule 1.1 attor- result in violation of ethical id. Rule skill, ("A neys "legal knowledge, lawyer accept repre- to utilize the thor- 1.16 cmt. 1 should not oughness preparation reasonably necessary performed sentation in a matter unless it can be representation"); competently, promptly completion.”). for the id. Rule 1.2 cmt. 5 ... to 776 . expression of underwrite the does not engage in ac- course did not grantees ensured that grant- viewpoints of its private speech or program: the scope the the of outside

tivities matter) (for that lawyers, or their ees or can, violating the without The Government clients. their to Constitution, selectively program fund a to princi- it believes encourage impair certain activities not the Bosenberger does interest, at the without and not public in the in Bust be announced ple explicitly — program funding Bosenberger an alternative time facts of implicated same the —that problem the specific to deal with services government which seeks funds when the interest, may doing, the it way. public In so Government another to the it deems be basis of view- program. on the get has not to with its require discriminated merely to fund one to it answer point; majority’s surprising, has chosen short the other. activity passage exclusion of from Bust that the argument this at “reliably be tаken rely I cannot on which program at 1772. The 111 S.Ct. Id. at [page This Majority 770]. at value.” face therefore “not upheld in Bust definition opinions is not Supreme Court approach to singling out a general law case of a the I employed in this Circuit. previously one speech con- group on the basis of disfavored said, it meant what Supreme think the Court refusing tent, of the Government but a case bears, repeating: that it activities, including speech, which are to fund can, violating the without Government scope of from the the specifically excluded Constitution, selectively program fund 194-95, 111 at S.Ct. at project Id. funded.” it encourage certain activities believes possible to present' case it is 1773. Of the interest, the without at in the scope Bust the of say paraphrase funding time an alternative same funding of certain project is the the LSC problem with the to deal which seeks services, that the law does individual client way. doing, the Government another so group,” and single any “disfavored out of view- on the basis has not discriminated simply “refus[ed] has fund one merely chosen to point; it has activities, including speech, which are fund activity other. exclusion scope specifically excluded Rust, at 1772. project funded.” 500 U.S. at 111 S.Ct. invoked Recently Supreme itself Court opinion majority arises The error uphold passage quoted Bust —and —to (and complete) reliance on inapt its disbursement of funds on the restrictions purpose a case in which Bosenberger, the Arts. See Endowment for the 'Nationаl to fund the government program was Finley, Arts v. Endowment National politically views. The expression of diverse — 2179, 141 U.S. -, -, 118 S.Ct. defraying part of University Virginia was Bust, (quoting L.Ed.2d publications, but printing costs of student 1772). 193, 111 at journals promoted denied fire to find out There is sure Supreme one viewpoint. The Court religious meant what funding deci whether held that such content-based Finley, and now that in Bust and expendi said impermissible sions are when majority split with the Circuit private has Ninth to facilitate is intended ture of funds issue, long to wait. not have diversity this we speech “encourage thus Bust, rejected a Relying the Ninth Circuit Rosenberger speakers.” private views from Va., discrimination v. Rector & Univ. Visitors of 2510, 2519, that are issue on 132 LSC restrictions Soc’y Hawaii v. appeal. Legal Aid holding Bosen- L.Ed.2d 700 (9th Cir.), Legal Corp., 145 F.3d Servs. government subsidizes berger is that when — — U.S. -, denied, cert. express their own view speakers to private L.Ed.2d - (1998). (part of Justice White among poten points, it cannot discriminate designation sitting by majority), the Bust viewpoint. recipients on the basis of tial Circuit, the Title “Like X the Ninth wrote: LSC, supports program defined Bust, clients, program is de- the LSC program indigent to legal representation signed provide professional Viewpoint to services of lim- B. Discrimination scope indigent persons, to not create a ited Considering that majority has invali- expression forum the free of ideas.” Id. for ground dated a statute on the that it consti- at 1028. impermissible discrimination, viewpoint tutes majority it that the only vaguely is odd artic- distinguish attempt opin- In an the Rust ulates the supposedly disfa- result, majority ion from the Rust offers by legislation (reciprocally) vored government-financed hypothetical never states what viewpoint is favored. The study think tanks commissioned American is, subject-matter fact the LSC restrictions foreign policy, to criticize it. but forbidden do not analysis lend themselves to in these any hypothetical This is far removed from funding terms. One subsection pro- bars “to services; legal tellingly, to furnish legal vide per- assistance civil actions to very University it looks much like the sons who have been convicted of a criminal Virginia’s student-publication program in Ro- charge ... purpose challenging for the senberger. validity of the criminal conviction.” 42 2996f(b)(3)(1994). U.S.C. analogy presented A Does the statute closer would be if (i) thereby against “discriminate” the “view- Congress decided out-source advice point” prisoners have constitutional gives that the Internal Revenue Service now rights? provision Another bars “to taxpayers they much on how taxes owe and provide legal respect any assistance with deduct, (ii) how much can shelter or litigation proceeding relating deseg- or to the lawyers and tax underwrote accountants regation any elementary secondary represent qualifying counsel and middle-class 2996(b)(9) (1994). school.” U.S.C. (iii) taxpayers, and then discovered that the thereby Does the statute “discriminate” expending apprecia- outside contractors were against “viewpoint” ought that schools grant agitation tax ble resources for re- desegregated? If limitations on classes of along form lines favored the contractors eligible representation by cases for LSC- by them to be in the and deemed interest of lawyers impermissible finaneed constitute Congress certainly the middle classes. could against may people discrimination who plug by specifying repre- that drain cases, want to advance theories in such then achieving sentation be limited to the accurate many it is hard to see how statuto- computation pres- of amounts due under the ry limitations on funds are LSC constitution- code, by barring advocacy tax ent aimed al. at, alia, reform, establishing inter tax tax, single organizing tax or flat constitu- token, By agree the same I cannot litigation challenge particular tional reve- promotes the statute one favored view over provisions nue or the ratification of the 16th supposed public others in a forum. Whose this, Amendment. could do and if viewpoint? According What forum? did, legislation would look like the majority opinion: government-funded majority un- restriction here holds lawyers possess protected expressive in- terest; public constitutional. and the forum is the court- (an surprise room idea that come as restrictions, my hypothetical like judges). Majority [pages to trial taxpayers, promotion statute to assist is not a proviso 770-71]. But the stricken advocacy good quo, for the old status or a majority representation bars in lawsuits. suppression point of a of view. Both viewpoints litigating lawyers in a grams money channel to an identified present pur- courtroom cannot matter purpose, which is the administration of a poses, (among things) because the ad- complex existing everyone statute so can vocacy lawyer of' is at the get provides. what I statute cannot client; service of the it would be inaccurate imagine viewpoint-neutral legislative (and unfair) a more lawyer’s to assume that a advo- cacy expresses lawyer’s personal scheme. view Karen N. Kornfield and Robert Rules Model morals. See polities or Kornfield, Appellants, 1.2(b) E. Rule Conduct Professional proviso be said It also cannot clients; speech of the disfavors Schwartz, Carolyn United States S. who seek are are funded those

litigants who Trustee, Appellee. certainly people on There benefits. Docket No. 97-5080 .issues, as those such of welfare other side eligibility, or narrowing welfare who favor Appeals, States Court United benefits, welfare or abolition reduced Second Circuit. nothing. them gives statute system. But the discrimination, May Argued 1998. then Where not) (as I if one assumed do even Jan. 1999. Decided every into a courtroom makes forum? and other constitutional

The statute bars laws, it certain-

challenges welfare but view that the welfare

ly does fund constitutionally impregnable. laws are majority does not by the

proviso invalidated any message. lays It down

promote or favor provided to to be for services

specifications And it excludes some

favored beneficiaries. expensive

of the most services—constitution- statutory challenges al —in bars the the statute elsewhere

same class actions. of LSC funds for

expenditure initiatives, the expensive excluding

In these limited expenditure of maximizes the

statute expensive benefit- for less

available funds Congress able to do

collection lawsuits.2

that; Congress does in which and a statute a facial able to withstand should

challenge. re: N. KORNFIELD Robert ‍​​​‌‌​‌​​​​​‌‌‌‌‌‌​​​‌‌‌​​​​​‌‌‌‌​​‌‌​‌‌​​‌‌‌​​​‍Kornfield, E. Debtors.

Karen cases) (and politically expensive oriented essentially often striking proviso, majority By category chose not fund. money precise appropriates for the

Case Details

Case Name: Carmen Velazquez v. Legal Services Corporation, United States of America, Intervenor-Appellee

Court Name: Court of Appeals for the Second Circuit

Date Published: Jul 2, 1999

Citation: 164 F.3d 757

Docket Number: 2020, Docket 98-6006

Court Abbreviation: 2d Cir.