September 24, 2009

An ACORN twofer

First, it looks like ACORN is coming unraveled. From the National Review:
ACORN: Tax Cheats
ACORN CEO Bertha Lewis told Fox News Sunday on September 20 that her group �absolutely pays its taxes.� But her claim crumbles before the $548,213.25 federal tax lien that the Internal Revenue Service filed against the embattled New Orleans-based activist organization. Louisiana state tax officials also have slapped $334,121.43 in tax liens on ACORN since last October 29.
The article cites chapter and verse. Public organizations' tax records are public domain and a couple people have been doing some digging and tracking down the shadow organizations that are behind ACORN. Second, here is one lawyers take on the lawsuit. Again, from the National Review:
ACORN's Lawsuit
From a lawyer reader. I've redacted a bit from the opening in which he gives his background. He's not a specialist, so take it for what it's worth. It strikes me as pretty reasonable.
I hope all is well with you and yours.

I just wanted to give you a quick lawyer's take on the ACORN complaint against Breitbart, Giles, and O'Keefe. By way of background, I am [redacted] .... but would obviously like to keep my identity concealed if you should decide to pass this along to anyone.

First, ACORN filed in state court in Baltimore to get the home field advantage, but there is diversity jurisdiction and it will almost certainly be removed to federal court. That will likely be the defendants' first move. I'm not terribly familiar with that federal district, but it is surely more conservative than a Maryland state court. Moreover, it lies in the Fourth Circuit, which is one the most conservative in the country, so there is an excellent appellate "back stop" that will be a great advantage to the defendants.

Second, ACORN's legal theory is very, very thin. Their only cause of action is for a violation of the Maryland wiretapping statute. I'm certainly no expert on that statute, and I have no opinion as to whether Giles and O'Keefe violated it. But, for the sake of argument, let's assume they did. The violation of a criminal statute does not automatically give rise to civil liability in the absence of an express statutory provision that creates a private cause of action. I've litigated that issue on behalf of corporate defendants many, many times and my recollection is that I've never lost on it. I'm somewhat surprised that ACORN didn't include some other common law claims, such as intentional infliction of emotional distress or false light breach of privacy. But the problem with those claims is the vast, vast body of First Amendment law protecting media defendants (which surely includes Breitbart, Giles, and O'Keefe here).

Third, with a little bit of careful thought, the defendants could plead some interesting counterclaims. The federal False Claims Act and RICO come to mind, and would be very interesting.

Fourth, even if the defendants don't plead any counterclaims, the scope of discovery against ACORN will be incredibly broad, as it almost always is in civil litigation. ACORN has far, far more to lose from what could come out during discovery than what they are asking for in this suit.

Fifth, it's sorta bizarre that the fired employees are joining in the suit with ACORN, the entity that fired them. That complicates just about every legal theory, and even has possible ethical complications for their attorneys. I'd have to think about the issue some more, but at first blush I think the defendants' attorneys might want to move to disqualify the ACORN attorneys from representing all three plaintiffs on the grounds that the fired employees have, essentially, wrongful discharge claims against ACORN. Even if the motion is unsuccessful, each of the plaintiffs will have to take a stand, very early on in the litigation, as to whether or not the firings were appropriate. None of them have any good answers to that question.

In short, Learned Hand once said that he feared a lawsuit more than death or taxes. With good lawyering from the defendants (which I'm sure their going to get), ACORN is about to find out what Hand meant. ACORN has very little to gain and a lot to lose.

Keep up the great work!
Not thinking too clearly here -- this will be a fun trial to follow... Posted by DaveH at September 24, 2009 11:22 AM