Search the Shriver Center
Entire Site Poverty Law Library Clearinghouse Review

The Ninth Circuit has held that government restrictions on the activities of organizations that accept funds distributed by the Legal Services Corporation (LSC) are not unconstitutional. Plaintiffs, a group of organizations and an individual involved in the provision of legal services to indigent persons, alleged that the restrictions impose unconstitutional conditions on the exercise of their First Amendment rights. The district court granted plaintiffs’ motion for a preliminary injunction in part, concluding that LSC’s "interrelated organization" regulation did not provide LSC recipients with the ability to form affiliate organizations to pursue prohibited activities with non-LSC funds. In response, LSC revised its regulations to mandate that a recipient of LSC funds maintain physical and financial separation from unrestricted organizations. Subsequently, the district court granted defendants’ motion for summary judgment, and plaintiffs appealed. The court of appeals held that plaintiffs’ unconstitutional conditions argument is without merit because neither the congressional enactments nor the implementing regulations impinge on First Amendment rights. The court noted that the regulations promulgated by LSC to preserve the distinction between restricted and unrestricted organizations are nearly identical to those upheld in Rust v. Sullivan, 500 U.S. 173 (1991). The court found that, as in Rust, the LSC regulations do not force a recipient to give up prohibited activities; they merely require that the recipient keep such activities separate and distinct from LSC activities. The court rejected plaintiffs’ argument that, because the LSC regulations apply to "recipients" and not "projects," the regulations are unconstitutional. The court held that the proper constitutional test does not focus on the particular term used by the government agency, but whether the regulations effectively prohibit the recipient from engaging in the protected conduct outside the scope of the federally funded program. The court also rejected plaintiffs’ argument that the LSC regulations are unconstitutional because of the hardship they impose on LSC recipients. The court found insufficient evidence to support plaintiffs’ assertions concerning how the regulations will be interpreted and applied to recipients. In addition, the court rejected plaintiffs’ argument that the restrctions violate the First Amendment rights of full-time legal services lawyers. The court held that, like the restrictions on doctors in Rust, the restrictions on an LSC-funded attorney are a consequence of that attorney’s decision to accept full-time employment with an LSC-funded organization. Finally, the court rejected plaintiffs’ argument that the restrictions violate the Fifth Amendment rights of legal services clients to obtain fair and equal access to the courts. The court held that plaintiffs lacked standing to assert the rights of clients of legal services organizations and, in any event, the claims are meritless.