As we previously wrote about, here, Finney Law Firm was honored to serve as co-counsel to Tea Party groups throughout the nation in what we believe was the only certified class action ever against the Internal Revenue Service for its targeted discrimination against the plaintiffs resulting in protracted delays in processing and granting tax exemption status due to their political viewpoints. The targeting was led by Obama administration IRS official Lois Lerner and her chief deputy at the IRS, Holly Paz.

After years of pitched legal battles, that litigation ended with a dramatic settlement in which the IRS paid damages to Tea Party groups, the IRS paid the Tea Parties’ attorneys fees, and then-US Attorney General Jeff Sessions issued a personal apology on behalf of the United States of America that included this unequivocal statement about the IRS intentional wrongdoing: “this abuse of power will not be tolerated.”

In that litigation, plaintiffs succeeded in obtaining the depositions of Lerner and Paz, but the transcripts of the depositions — finally revealing their own testimony about the origins and implementation of the outrageous policies and practices — have remain sealed under a temporary emergency Order by Judge Michael Barrett. (Even US House and Senate Committees investigating the wrongdoing were stymied in getting that testimony when Lerner and Paz each invoked their 5th Amendment right against self-incrimination.)  That Order bottling up the deposition transcripts was never made final, and thus it could not be appealed.  Thus, to this day — more than three years later — the deposition transcripts remain hidden from public scrutiny.

As a result, this week, Plaintiff’s counsel filed a Motion for Writ of Mandamus before the 6th Circuit Court of Appeals seeking to have the depositions unsealed.  You may read the Motion here.

We are local counsel in the case of the NorCal Tea Party v. IRS. we announced this morning that the case has settled with an admission from the U.S. Attorney General that what occurred was a “gross abuse of power.”

Read the coverage here:

Washington Post: Justice Department agrees to settle lawsuits over IRS scrutiny of tea party groups

Wall Street Journal: Administration Agrees to Settle Tea-Party Suits Against IRS

New York Times: Justice Department Settles With Conservative Groups Over IRS Scrutiny

Public Broadcasting Service:  Tea party groups settle lawsuits over IRS mistreatment The Trump administration has settled lawsuits with tea party groups that received extra, often burdensome scrutiny when applying for tax-exemp…       

 CBS News: DOJ announces settlement with Tea Party groups

Fox NewsTrump DOJ settles lawsuits over Tea Party targeting by Obama IRS

USA Today: Justice Department settles IRS lawsuits from 400 conservative groups claiming discrimination

New York Daily News: IRS settles Tea Party groups’ suits over delayed nonprofit status

Chicago Tribune: Justice Department agrees to settle lawsuits over IRS scrutiny of tea party groups

Cleveland Plain Dealer: Tea Party groups settle lawsuit against IRS; agency apologizes for discrimination during Obama’s

San Francisco Chronicle: Tea party groups settle lawsuits over IRS mistreatment

Yahoo Finance: Tea party groups settle lawsuits over IRS mistreatment

Minneapolis Star: Tea party groups settle lawsuits over IRS mistreatment; will get apology

Townhall: DOJ Starts to Make Amends for Tea Party Scandal

Washington Times: Feds to pay ‘generous’ settlement to tea party groups for targeting

Breitbart News: DOJ Settles with Tea Party Groups on Lois Lerner IRS Scandal

Cincinnati Enquirer: IRS settles tea party cases for millions and an apology

We are pleased to bring you this morning news that the Internal Revenue Service has settled the case of NorCal Tea Party v. IRS filed in the United States District Coiurt for the Southern District of Ohio.  We have served as local counsel in “what may be the only nationwide class ever formed for a claim of this type.”

United States District Court Judge Susan Dlott originally handled the case and certified it as a class action.  It most recently has been handled by Judge Michael Barrett.

U.S. Attorney General Jeff Sessions today weighed in personally on the settlement and the conduct of the IRS:

“There is no excuse for this conduct.  Hundreds of organizations were affected by these actions, and they deserve an apology from the IRS. We hope that today’s settlement makes clear that this abuse of power will not be tolerated.”

The Washington Post has the story here.

The statement by our lead counsel, Eddie Greim of Garrett Graves in Kansas City is below:

The United States Reaches Agreement with a Nationwide Class of Over 400 Targeted Groups in NorCal v United States, Vindicating Plaintiffs’ Claims in a Generous Financial Settlement

KANSAS CITY, MISSOURI, October 26, 2017

The Plaintiffs in NorCal v. United States are pleased to announce that late yesterday, the United States entered into a generous financial settlement to pay the claims of each of over 400 groups in the Plaintiff Class who were targeted by the IRS for their political beliefs. It is a great day for the First Amendment and the promise of fair and impartial government. But this day was too long in coming.

Five groups filed this case, the first claim against the IRS for its targeting of conservative groups, and the only nationwide class action, in May 2013. These five, NorCal Tea Party Patriots, South Dakota Citizens for Liberty, Americans Against Oppressive Laws, San Angelo Tea Party, and the Texas Patriots Tea Party, sacrificed hundreds of hours of time. The lawsuit stretched over four years and was sustained by funding from Citizens for Self-Governance, a non-profit that aids citizen groups. CSG was itself targeted by the IRS during the discovery process, but refused to back down.

In 2015, Judge Susan Dlott of the U.S. District Court for the Southern District of Ohio certified what may be the only nationwide class ever formed for a claim of this type. In 2016, the Sixth Circuit Court of Appeals soundly rejected the IRS’s attempt to use taxpayer protection laws to withhold evidence of its own wrongdoing in the case. In 2016, District Judge Michael Barrett entered a preliminary injunction against the IRS, finding a strong showing of a likelihood of success on Texas Patriots Tea Party’s First Amendment claim. In 2017, Texas Patriots became one of the last groups to have its exempt status recognized. Also in 2017, the Plaintiffs took the first and only deposition of Lois Lerner, which remains under seal in a manner still being litigated by Plaintiffs notwithstanding the proposed settlement. Under federal court rules, District Judge Barrett must still approve the class settlement on the motion of the parties.

By the fall of 2017, dozens of IRS officials had testified under oath, and the case was being prepared for trial. As part of this process, Attorney General Sessions’ Department of Justice carefully reviewed the facts. The generosity of its proposed settlement belies recent, uninformed claims that IRS officials merely mismanaged the files of conservative groups, or subjected liberal groups to similar treatment. To the contrary, Plaintiffs developed evidence showing that IRS managers knew that groups’ views, not their activities, were being used to target them for heightened scrutiny. Even after they gained this knowledge, officials like Lois Lerner failed to release the targeted groups, ordering up more scrutiny and delay even while betraying worry that the “Tea Party matter” was “very dangerous.” This was far more than the “lack of adequate management” the IRS or TIGTA is publicly willing to acknowledge.

Attorney General Sessions rightly calls this an “abuse of power.” As he says, the Plaintiffs deserve an apology from the IRS. But not even a court can force the IRS to apologize or admit to its wrongdoing. Those remedies are unknown to the law. A true reckoning is finally up to the agency itself. Until the IRS itself steps forward to admit what really happened, we cannot have faith that the same abuse won’t be repeated again. It is easy for the IRS to abuse its toolbox of policies and procedures that seem neutral on their face, just like the superficially innocent process of “centralization” that Lois Lerner and others used as an excuse to abuse the Plaintiffs. So truly, it is not just Plaintiffs who need an apology. Every taxpayer and group, whether or not targeted in this particular scheme, has a right to demand a truthful apology based on the facts and a real reckoning. Before Commissioner Koskinen leaves office, the Plaintiffs call on him to do the right thing.

For questions, please contact counsel Eddie Greim at 816-256-4144.


It has been four long years of litigation, class certification, motions, discovery, an interlocutory appeal to the 6th Circuit, and more motions, but the only certified class action against the IRS arising from Tea Party targeting is approaching trial in 2018, if the Plaintiffs survive the IRS’ motion to have the case preemptively disposed of on summary judgment.

Those motions are being briefed right now before U.S. District Court Judge Michael Barrett, and today’s Cincinnati Enquirer has the story on those briefings here.

A few things to note about the case:

  • The Jeff Sessions Justice Department continues to defend the suit under President Donald Trump in much the same vigorous fashion as it did under Loretta Lynch and President Obama.
  • IRS Commissioner John Koskinen, whom Congressional Investigators accused of stonewalling investigators and covering up for Lois Lerner’s and the IRS’ excesses, remains in his role.
  • Judge Barrett has for now sealed the deposition transcripts of Lois Lerner and Holly Paz, the architects of the IRS targeting.  The sealing was at the request of Lerner and Paz who claimed to fear harassment if their testimony were revealed.

This firm is pleased to serve as local counsel, along with David Langdon, to the Tea Party groups in this important litigation.