Regan v. Wright Petition for Writ of Certiorari
Public Court Documents
November 30, 1981

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Brief Collection, LDF Court Filings. Regan v. Wright Petition for Writ of Certiorari, 1981. 6a13efe8-c19a-ee11-be36-6045bdeb8873. LDF Archives, Thurgood Marshall Institute. https://ldfrecollection.org/archives/archives-search/archives-item/9da59869-29c1-4367-92d5-d66b6dad1488/regan-v-wright-petition-for-writ-of-certiorari. Accessed July 11, 2025.
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No. In % (tart of tlyp Huttrfc States O ctober T e r m , 1981 D o n a ld T . R e g a n , Se c r e ta r y of t h e T r e a su r y , e t a l ., p e t it io n e r s v. I n e z W r ig h t , e t a l . PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT Rex E. Lee Solicitor General John F. Murray Acting Assistant Attorney General Stuart A. Smith Assistant to the Solicitor General Michael L. Paup Ernest J. Brown Robert S. Pomerance Attorneys Department of Justice Washington, D.C. 20530 (202) 633-2217 QUESTION PRESENTED Whether federal courts may entertain equity suits against the Secretary of the Treasury brought by persons seeking to have the Treasury revise the rules under which it determines the eligibility of private schools for tax-exempt status, and to deny or revoke tax-exempt status of private schools claimed to have insufficient minority enrollment, where the plaintiffs allege no actual injury to themselves either by any private school or by the Treasury. (i) ( i l TABLE OF CONTENTS Page Opinions be low ...................................................................... 1 Jurisdiction.... ................. -......-..................................... ........ 2 Constitutional provisions, statutes and regulations involved - ..... .................. - ......... -......-................................ 2 Statement: A. Background ........—......-......-.........-.......................... 2 B. The proceedings in this case-------------------- ------ 5 Reasons for granting the petition.---------------—............... H Conclusion ---------------------- ------ -......................................... 24 Appendix..... -.....-..................... —................... -.............. -...... ^a TABLE OF AUTHORITIES Cases: American Jewish Congress V. Vance, 575 F.2d 939- 10 American Society of Travel Agents V. Blumenthal, 566 F.2d 145, cert, denied, 435 U.S. 947 .... . 10 Angelus Milling Co. V. Commissioner, 325 U.S, 293.. 20 Baker V. Carr, 369 U.S. 186 -------------------------------- 16 Boh Jones University V. Simon, 416 U.S. 725------ 17, 20 Bob Jones University V. United States, 639 F.2d 147, cert, granted, No. 81-3 (Oct. 13, 1981)------ 4, 23 Coit V. Green, 404 U.S. 997, aff’g Green V. Con nolly, 330 F. Supp. 1150......................--------------- 10 Enochs V. Williams Packing Co., 370 U.S. 1 --------- 20 Flast V. Cohen, 392 U.S. 8 3 ...... ................. ................ 16 Flora V. United States, 362 U.S. 145 -------------------- 20 Gilmore V. City of Montgomery, 417 U.S. 556---- 10,17,18 Goldsboro Christian Schools, Inc. V. United States, cert, granted, No. 81-1 (Oct. 13, 1981) ------------- 4 Green v. Kennedy, 309 F. Supp. 1127, continued, 330 F. Supp. 1150, aff’d, 404 U.S, 997 ...... ........— 16 Laird V. Tatum, 408 U.S. 1 --------- ------- ------- -------- 19 Louisiana V. McAdoo, 234 U.S. 627 --------------------- 20 (HI) Cases— Continued IV Page Moose Lodge No. 107 V. Irvis, 407 U.S. 163---------- 15 Norwood V. Harrison, 413 U.S. 455 .........— ......... - 10,17 O’Shea V. Littleton, 414 U.S. 488 ------------------- ---- 15 Prince Edward School Foundation V. Commis sioner, 478 F. Supp. 107, aff’d by unpublished order, No. 79-1622 (D.C. Cir. June 30, 1980), cert, denied, No. 80-484 (Feb. 23, 1981) --------- 4 Schlesinger V. Reservists to Stop the War, 418 U.S. 208 .................................................... -........- .......... - 16,19 Sierra Club V. Morton, 405 U.S. 727 -------------------- 15 Simon V. Eastern Ky. Welfare Rights Organiza tion, 426 U.S. 26 ............ ........... -8, 9,11,12,13, 14,16, 20 Tax Analysts & Advocates V. Blumenthal, 566 F.2d 130, cert, denied, 434 U.S, 1086 —........ - ......-....... 10 United States V. Felt & Tarrant Co., 283 U.S. 269 ................................................................-............. 20 United States V. Richardson, 418 U.S. 166---- 15,19, 21, 23 Warth V. Seldin, 422 U.S. 490 _____________ 13,15,16,18 Constitution and statutes: United States Constitution: Article II, Section 3 ------------------------------------- 19 Article III ------------ ----------------- -------------2,11,15, la Fifth Amendment____ ____ —------------------------ 2 Fourteenth Amendment ------- -------------- ----- 2 Anti-Injunction Act, 26 U.S.C. 7421(a) ........ — 20 H.R. J. Res. 644, of Dec. 16, 1980, Pub. L. No. 96- 536, 94 Stat. 3166, Section 101(a) (1) and (4 ), as amended by Supplemental Appropriations and Rescission Act, 1981, Pub. L. No. 97-12, Section 401, 95 Stat. 95 - ----- ------------ -------------------------- 22 H.R. J. Res, 325, Pub. L. No. 97-51, 95 Stat. 958.... 23 Internal Revenue Code o f 1954 (26 U .S.C.): Section 170(a) Section 170 (c)(2 ) Section 501(a) .... Section 501(c) (3) Section 6212 ------ Section 6213 ------ Section 6532 ......... ............... . 2, la _______ 2, 3,12, 2a .................. 2 2, 3, 4, 9,12,17,19 __________ 20 __________ 20 ..................... 19 V Constitution and statutes— Continued Page Section 7422 ...... 19 Section 7801 (a) ________________ ___________ 19 Section 7805(a) .............................. ......... ........ . 19 Sections 8021-8023 ______________________ 19 28 U.S.C. 1346 ________________ ____ ________ _ 19 28 U.S.C. 1491...................... 19 28 U.S.C. 2201 _________________________ 20 Treasury, Postal Service, and General Government Appropriations Act of 1980, Pub. L. No. 96- 74, 93 Stat. 559 ........................................... .............. 5 Section 103, 93 Stat. 562 _______________ 2 ,5 ,9 ,22 Section 615, 93 Stat. 577 _______ ___ ___ 2, 5, 9, 22 Rev. Stat. 1977 (1878 ed.) (42 U.S.C. 1981) _____ 2 Miscellaneous: 4 Administration, Internal Revenue Manual (CCH ), im 341.11-341.13 ______ ___ ________ ____ _ 3 127 Cong. Rec. H5392 (daily ed. July 30, 1981).... 22-23 127 Cong. Rec. H6698-H6699, H6702 (daily ed. Sept. 30, 1981) _______ _______ _____________ _ 23 H.R. 4121, 97th Cong., 1st Sess. § 616 (1981) ____ 22 H.R. Rep. No. 94-1656, 94th Cong., 2d Sess. (1976) ........................ ............ ............. ..................... 20 H.R. Rep. No. 96-248, 9th Cong., 1st Sess. (1979).. 22 Rev. Proc. 75-50, 1975-2 Cum. Bull. 587 __________2, 3, 23 §2.02 ............................................................. ........ 3 Rev. Rul. 71-447, 1971-2 Cum. Bull. 230 __________ 4 Rev. Rul. 75-231, 1975-1 Cum. Bull. 158 ________ 4 S. Rep. No. 94-996, 94th Cong., 2d Sess, (1976)___ 20 Tax-Exempt Status of Private Schools: Hearings Before the Subcomm. on Oversight of the House Comm, on Ways and Means, 96th Cong., 1st Sess. (1979) 21 3n % ̂ KpYmv (Emtrt 0! th? Imteft 01at̂ October T e r m , 1981 No. D o n a ld T . R e g a n , Se c r e ta r y of t h e T r e a su r y , et a l ., pe t it io n e r s v. I n e z W r ig h t , e t a l . PETITION FOR A W RIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT The Solicitor General, on behalf of the Secretary of the Treasury, and the Commissioner of Internal Revenue, petitions for a writ of certiorari to re view the judgment of the United States Court of Appeals for the District of Columbia Circuit in this case. OPINIONS BELOW The opinion of the district court (Interv. Pet. App. A la -lS a )1 is reported at 480 F. Supp. 790. The opinion of the court of appeals (Interv. Pet. App. B lb-58b) is reported at 656 F.2d 820. 1 “ Interv. Pet” refers to the petition for a writ of certiorari (No. 81-757) filed by the intervener W. Wayne Allen, Chair man of the Board of Trustees of the Briarcrest School Sys tem in Memphis, Tennessee. (1) 2 JURISDICTION The judgment of the court of appeals was entered on June 18, 1981. The orders of the court of ap peals denying the petition for rehearing (Interv. Pet. App. C) with suggestion for rehearing en banc (Interv. Pet. App. D) were entered on Au gust 26, 1981. A petition for a writ of certiorari (No. 81-757) was filed on behalf of the intervenor W. Wayne Allen on October 20, 1981. The jurisdic tion of this Court is invoked under 28 U.S.C. 1254(1). CONSTITUTIONAL PROVISIONS, STATUTES AND REGULATIONS INVOLVED The Fifth and Fourteenth Amendments to the United States Constitution, Section 501(a) and (c) (3) of the Internal Revenue Code of 1954 (26 U.S.C.), Rev. Stat. 1977 (1878 ed.) (42 U.S.C. 1981), and Sections 103 and 615 of the Treasury, Postal Service, and General Government Appropria tions Act of 1980, Pub. L. No. 96-74, 93 Stat. 562, 577, are set forth at Interv. Pet. 2-4. The relevant provisions of Article III of the Constitution and Sec tion 170(a) and (c ) (2 ) of the Internal Revenue Code of 1954 (26 U.S.C.) are set forth in Appendix A , infra. Revenue Procedure 75-50, 1975-2 Cum. Bull. 587, the Proposed Revenue Procedure, and the Modified Proposed Revenue Procedure are set forth respec tively at Interv. Pet. App. E le-12e, F lf-13f, and G lg-14g. STATEMENT A. Background Since 1970, the Internal Revenue Service has uni formly taken the position that a private school will 3 Hot qualify as a tax-exempt organization under Sec tion 5 0 1 (c )(3 ) of the Internal Revenue Code of 1954, or as an eligible donee of charitable contri butions deductible under Section 170(c) (2) of the Code, unless it establishes that its admissions and educational policies are operated on a racially non-discriminatory basis. Rev. Proc. 75-50, 1975-2 Cum. Bull. 587 (Interv. Pet. App. E le-12e) sets forth the currently effective guidelines by which the Internal Revenue Service determines whether private schools seeking to acquire or maintain tax- exempt status have racially nondiscriminatory poli cies as to students.2 The Revenue Procedure accord ingly provides (§2 .02) that “ [a] school must show affirmatively both that it has adopted a racially non discriminatory policy as to students that is made known to the general public and that since the adop tion of that policy it has operated in a bona fide manner in accordance therewith.” The Revenue Pro cedure thereafter enumerates requirements that must be met by each school seeking to establish that it has adopted and is operating in accordance with a nondiscriminatory policy. Under the Revenue Pro cedure, a school seeking to acquire or retain tax- exempt status and eligibility for tax-deductible con tributions must state in its charter documents, and catalogues that it has adopted a non-discriminatory policy; publicize that policy at least once annually so as to bring it effectively to the attention of all racial segments of the community; and maintain records documenting, inter alia, the racial composition of its 2 In 1976 and 1977, the Internal Revenue Service also issued more detailed guidelines for the use of revenue agents per forming field audits o f private schools. See 4 Administration, Internal Revenue Manual (C'CH) HU 341.11-341.13, at 22,457-9 — 22,460. students, faculty, and administrative staff. Officials of a school claiming the benefits of tax exemption are required to certify to the Internal Revenue Service each year, under penalties of perjury, that the school has complied with the guidelines (Interv. Pet. App. E 7e-8e).3 On August 22, 1978, the Internal Revenue Serv ice published a proposed revenue procedure (see Interv. Pet. App. F lf-13 f) seeking to amplify its policy with respect to schools that had been held by a court or agency to be racially discriminatory, and schools that had an insignificant number of minority students and were formed or substantially expanded at or about the time of desegregation of the public schools in the community After lengthy administra tive hearings and the receipt of a substantial num ber of adverse written comments, the Internal Rev 3 See Rev. Rul. 71-447, 1971-2 Cum. Bull. 230; Rev. Rul. 75-231, 1975-1 Cum. Bull. 158. See also Prince Edward School Foundation V. Commissioner, 478 F. Supp. 107 (D.D.C. 1979), aff’d by unpublished order, No. 79-1622 (D.C. Cir. June 30, 1980), cert, denied, No. 80-484 (Feb. 23, 1981) (non-religious private school denied tax-exempt status for failure to make requisite showing that it maintained a racially non- discriminatory admissions policy where no black child had been admitted for a period of almost 20 years; directors’ belief in the value of segregated education does not excuse failure to make requisite showing of nondiscriminatory policy). The Internal Revenue Service’s position is before the Court in two cases presenting the question whether nonprofit cor porations operating private schools that, on the basis of reli gious doctrine, maintain racially discriminatory admissions policies and other racially discriminatory practices qualify as tax-exempt organizations under Section 5 01 (c )(3 ) of the Code. See Goldsboro Christian Schools, Inc. V. United States, No. 81-1, and Bob Jones University V. United States, cert, granted, No. 81-3 (Oct. 13,1981). 4 5 enue Service issued a revised proposal on February 9, 1979 (Interv. Pet. App. G lg-14g). The Internal Revenue Service’s proposals led to the enactment of two related provisions that Con gress included in the Treasury, Postal Service, and General Government Appropriations Act of 1980, Pub. L. No. 96-74, 93 Stat. 559. In Section 615 (93 Stat. 577), known as the Dornan Amendment, Con gress stipulated that none of the funds made avail able by the Act be used to carry out the proposed revenue procedures of 1978 and 1979. In Section 103 (93 Stat. 562), of the same Act, known as the Ashbrook Amendment, Congress provided that none of the funds made available by the Act be used “ to formulate or carry out any rule, policy, proce dure, guideline, regulation, standard, or measure which would cause the loss of tax-exempt status to private, religious or church-operated schools under Section 5 0 1 (c )(3 ) of the Internal Revenue Code of 1954 unless in effect prior to August 22, 1978.” The district court observed that “ [t]he effect of [this congressional] action is to retain in effect, at least until September, 1980, the presently effective Rev. Proc. 75-50 * * *” (Interv. Pet. App. A 14a). B. The Proceedings in this Case 1. Respondents are the parents of 25 black school children who attend public school in seven states, and claim to represent a nationwide class of “ several mil lion individuals” (Interv. Pet. App. A la ) . They brought this action in the United States District Court for the District of Columbia against the Sec retary of the Treasury and the Commissioner of In ternal Revenue, alleging that these federal officials “have fostered and encouraged the development, oper 6 ation and expansion of * * * racially segregated pri vate schools by granting them, or the organizations that operate them, exemptions from federal taxation * * 20) 4 Respondents alleged that the actions of the federal officials injured them and their class, and claimed injury in the following two respects, “ First, the exemptions constitute tangible financial aid and other assistance to racially segregated education. Second, the exemptions foster and encourage the development of institutions offering racially segregated educa tional opportunities for white children avoiding at tendance in desegregating public school districts, and thereby also interfere with the efforts of federal courts, HEW and local school authorities to desegre gate racially dual school systems” (A. 11). Although their complaint asserted that “ thousands of newly created and many existing private schools have provided racially segregated alternative educa tional opportunities for white children avoiding at tendance in desegregating school systems” (A. 9), it identified only 19 private schools that respondents claim to be “ racially segregated.” 4 5 Respondents 4 “A .” refers to the appendix filed in the court of appeals. 5 Respondents apparently use the term “ racially segre gated” to signify only that there are few or no black students in attendance at a particular school, and not to signify that the absence of blacks is attributable to racial exclusion prac tices. At a hearing in the district court, counsel for respond ents conceded that he did not know whether any of the black children who are parties to this action would be denied ad mission by any private school on the basis of race (Tr. of Motion of Defendants to Dismiss, Nov. 20, 1979, at 66-67). The complaint identifies a number of private schools that respondents alleged to fit this description: Harding Academy, Briarcrest Baptist School System and the Southern Baptist 7 sought declaratory and injunctive relief requiring the federal officials to deny all applications for tax- exempt status for, and to revoke tax exemptions held by all private schools “which have insubstantial or nonexistent minority enrollments, which are located in or serve desegregating public school districts” (A. 11) and which either (A. 37) — (1) were established or expanded at or about the time the public school districts in which they are located or which they serve were desegre gating; (2) have been determined in adversary judicial or administrative proceedings to be racially seg regated ; or (3) cannot demonstrate that they do not provide racially segregated educational opportunities for white children avoiding attendance in de segregating public school systems. Respondents further requested the court to grant injunctive relief in the nature of mandamus requir ing the federal officials to revise Rev. Proc. 75-50 and to substitute the criteria that they urge as the gov erning standard for granting tax exempt status to private schools (A. 37). Schools of Whitehaven, Inc., Memphis, Tennessee; Natchi toches Academy, Natchitoches Parish, Louisiana; Delta Christian Academy and Tallulah Academy, Madison Parish, Louisiana; River Oaks School, Monroe, Louisiana; Holly Hill Academy and Bowman Academy, Orangeburg, South Caro lina; Sea Pines Academy, Beaufort County, South Carolina; Prince Edward Academy, Prince Edward County, Virginia; Montgomery Academy and St. James Parish School, Mont gomery, Alabama; Camelot Parochial School, Cairo, Illinois; Hyde Park Academy, South Boston Heights Academy and Parkway Academy, Boston, Massachusetts. These schools are said to serve the desegregating public school districts where the minor respondents attend school (A. 20-34). 8 2. The district court dismissed respondents’ suit on three separate grounds. First, it concluded that respondents had no standing to bring the action be cause: (a) they had not asserted a distinct, palpable, and concrete injury; (b) they had not shown that their alleged injury was attributable to the federal officials’ actions; (c) there was no certainty that the relief requested would remove the injury; and (d) there was not a sufficient degree of concrete ad verseness between respondents and the federal offi cials (Interv. Pet. App. A 4a -lla ). In so ruling, the court relied principally on this Court’s decision in Simon v. Eastern Ky. Welfare Rights Organization, 426 U.S. 26 (1976). The court noted that respondents had not alleged that any of the private schools cited in the complaint was actually discriminating in violation of the Constitution or of federal law, or that any of them or their children had suffered any discriminatory action or exclusion. It questioned whether enforcement of respondents’ pro posed guidelines would ultimately cause any of these schools to lose tax-exempt status that it would have otherwise retained. Furthermore, even though the implementation of respondents’ guidelines might ulti mately serve to deprive some schools of their exempt status, the court found that respondents had not shown that the loss of exemptions would produce a net change in the desegregation of any particular school district. The court accordingly concluded that respondents had failed to show any nexus between the Internal Revenue Service’s position and the in jury allegedly suffered. Rather, the court observed that it appeared probable that any schools forced to choose would elect to forgo their exempt status rather than terminate any discriminatory practices (Interv. Pet. App. A 9a-10a). 9 Second, the district court ruled that responent’s action was “barred by the doctrine of nonreviewabil ity” because it “would require this Court to under take detailed or continuing review of a generalized IRS enforcement program, or to review complex issues of tax enforcement policy and of agency re source allocation” (Interv. Pet. App. A 11a). As the district court saw the matter, “ Such action would be tantamount to this Court becoming a ‘shadow Commissioner of Internal Revenue’ to run the ad ministration of tax assessments to private schools in the United States” (id. at 12a). Finally, the district court concluded that the enact ment in 1979 of the Ashbrook and Dornan Amend ments to the General Appropriations Act “ are the strongest possible expressions of the Congressional intent that Section 5 0 1 (c )(3 ) of the Internal Rev enue Code is not susceptible of the construction which [respondents] would place upon it in this case” (id. at 14a-15a). While the court acknowledged that the Ashbrook and Dornan Amendments apparently allow a federal court to fashion a remedy in this area, it concluded that it was “ not the business of a federal court to explicitly thwart the will of Congress or to otherwise fail to carry it out” (id. at 15a). 3. A divided panel of the court of appeals re versed (Interv. Pet. App. B lb-58b). It held that re spondents had standing to sue and remanded the case for further proceedings. In so ruling, the court acknowledged that this Court’s decision in Simon v. Eastern Ky. Welfare Rights Organization, supra, 26, leaves “ the door barely ajar for third party chal lenges” (Interv. Pet. App. B 16b) of the tax treat ment of others. It also recognized that its own previ ous decisions had dismissed for lack of standing suits brought by persons who sought to litigate the tax status of other parties.® But the court concluded that other precedent of this Court points in the opposite direction and indi cates “ that black citizens have standing to complain against government action alleged to give aid or com fort to private schools practicing race discrimination in their communities” (Interv. Pet. App. B 15b-16b). See Coit v. Green, 404 U.S. 997, aff’g Green v. Con nolly, 330 F. Supp. 1150 (D.D.C. (1 9 7 1 )); Norwood v. Harrison, 413 U.S. 455 (1973); Gilmore v. City of Montgomery, 417 U.S. 556 (1974). In the court’s view, those cases “ recognized the right of black citi zens to insist that their government ‘steer clear’ of aiding schools in their communities that practice race discrimination” (Interv. Pet. App. B 24b-25b). The court therefore ruled that because of “ the centrality of that right in our contemporary (post-Civil W ar) constitutional order, [it was] unable to conclude that Eastern Kentucky speaks to the issue before us” (ibid.). In addition, the court found no impediment to the action in the other grounds of the district court’s decision dismissing the suit. It concluded that the doctrine of nonreviewability did not preclude ad judication of respondents’ claims because they de rived ultimately from constitutional concerns that courts, as opposed to administrators, were better equipped to address (Interv. Pet. App. 32b-35b). Nor did it view the Ashbrook and Dornan amendments as prohibitions upon fashioning a remedy. The amend ments, as it construed them, were merely interim 6 6 See American Society of Travel Agents V. Blumenthal, 566 F.2d 145 (D.C. Cir. 1977), cert, denied, 435 U.S. 947 (1978) ; Tax Analysts & Advocates V. Blumenthal, 566 F.2d 130 (D.C. Cir. 1977), cert, denied, 434 U.S. 1086 (1978). , See also American Jewish Congress V. Vance, 575 F.2d 939 (D.C. Cir. 1978). 10 11 stop orders on agency initiatives and did not purport to control judicial dispositions (id. at B 25b-30b). In dissent, Judge Tamm deemed Eastern Ken tucky controlling. Finding that respondents had failed to allege a distinct and palpable injury to them selves, or a sufficient nexus between the Internal Revenue Service’s actions and whatever injury they claimed to have suffered, Judge Tamm would have denied them standing to maintain their suit. In his view, the majority’s opinion reflected an impermissi ble shift in focus from the right of respondents to make their claims to the rights they wished to assert. The majority, he concluded, had not only expanded significantly the law of standing, but had also over stepped the constitutional limits of its jurispruden tial power (Interv. Pet. App. B 38b-58b). REASONS FOR GRANTING THE PETITION In holding that respondents had standing to bring this suit in which they seek to compel the Depart ment of the Treasury to revise its rules governing the eligibility of private schools for tax-exempt status and to deny such status to schools having what they deem to be insufficient minority enrollment, the deci sion below refused to follow the squarely applicable precedent of Simon v. Eastern Ky. Welfare Rights Organization, 426 U.S. 26 (1976), in which this Court unanimously reversed the same court of ap peals that decided the instant case. The expansive view of standing adopted by the court of appeals seri ously erodes the previously settled “ case or contro versy” limitation of the Article III jurisdiction of the federal courts, and once again threatens the orderly administration of the revenue laws and the system 12 established by Congress for the adjudication of tax disputes. This Court should grant certiorari to dispel the uncertainty in the law of standing created by the decision below. 1. a. In Eastern Kentucky, as here, the plaintiffs sued to contest the Treasury’s administration of Sec tions 501(c) (3) and 170(c) (2) of the Internal Reve nue Code of 1954, not as it affected their own taxes but as it affected the tax treatment of private insti tutions not before the court, viz., hospitals that al legedly had denied free medical care to the indigent plaintiffs. The plaintiffs in that case likewise alleged that the Secretary of the Treasury and the Commis sioner of Internal Revenue had improperly conferred tax-exempt status to institutions that were not en titled to them under the Constitution and the tax laws, and thereby “ encouraged” hospitals to deny services to indigents. This Court held that the plaintiffs in that vir tually identical posture lacked standing to have their claims adjudicated in a federal court. As the Court reaffirmed, “ the ‘case or controversy’ limitation of Art. I ll still requires that a federal court act only to redress injury that fairly can be traced to the challenged action of the defendant, and not injury that results from the independent action of some third party not before the court” (426 U.S. at 41- 42). There, it was “purely speculative whether the denials of service specified in the complaint fairly can be traced to [the Treasury’s] ‘encouragement’ or instead result from the decisions made by the hos pitals without regard to the tax implications” (id. at 42-43.) Moreover, “ [i]t i[was] equally speculative whether the desired exercise of the court’s remedial powers in [that] suit would result in the availabil 13 ity to [the plaintiffs] of such services” (ibid.). In these circumstances, the Court held that the plain tiffs lacked standing because they had not shown that “ the asserted injury was the consequence of the de fendants’ actions; or that prospective relief will re move the harm.” Worth v. Seldin, 422 U.S. 490, 505 (1975). Eastern Kentucky governs this case. Indeed, un like the plaintiffs in Eastern Kentucky who alleged that they were denied medical treatment by par ticular hospitals, respondents’ generalized and at tenuated allegations concerning the practices of un identified private schools do not even demonstrate injury in fact. As the district court pointed out, “ there is no allegation in the record before the Court that the ‘target schools’ are actually discriminating in violation of the Constitution or federal law” (Interv. Pet. App. A 5a-6a). Nor do respondents allege that a judgment in their favor would redress any injury that fairly can be attributed to the chal lenged action of the Treasury defendants. In this respect, the court of appeals acknowledged that “ [re spondents] do not dispute that it is ‘speculative,’ within the Eastern Kentucky frame, whether any private school would welcome blacks in order to retain tax exemption or would relinquish exemption to retain current practices. They claim indifference as to the course private schools would take” (Interv. Pet. App. B 18b). While respondents are free to profess indifference to the response of the private schools whose policies they decry, “ [a] federal court, properly cognizant of the Art. I ll limitation upon its jurisdiction, must require more than respondents have shown before proceeding to the merits.” Simon v. Eastern Ky. Welfare Rights Organization, swpra, 426 U.S. at 46. 14 b. Although the court of appeals acknowledged that Eastern Kentucky “ suggests that litigation con cerning tax liability is a matter between taxpayer and IRS, with the door barely ajar for third party challenges” (Interv. Pet. App. B 16b), it concluded “ that Eastern Kentucky is not the line appropriately followed in the matter before us” {id. at 18b). In the court’s view, Eastern Kentucky was distinguish able because respondents do not assert “ a claim for relief against private actors” {ibid.) but rather against the government. But the plaintiffs in Eastern Kentuclcy did not assert a claim against the private hospitals. Like respondents, they sued the Secretary of the Treasury to compel a change in the rules governing the tax exemption accorded to private hospitals that were claimed to have injured the plaintiffs. Thus, Eastern Kentucky is squarely in point because both suits sought a change in governmental conduct. If there is any difference between the two cases, it is, as we have pointed out {supra, pages 6, 8, 13), that respondents have not even asserted any injury at the hands of the Treasury or any private school— a fact that the court of appeals conceded in stating that respond ents “ do not allege that any particular school turns away students on the basis of race” (Interv. Pet. App. B 22b n.27). Thus, respondents’ suit is even further removed from meeting the prerequisites of standing than the plaintiffs’ claim dismissed by this Court in Eastern Kentucky. There is, moreover, no basis for the court of appeals’ conclusion that “ the standing analysis should remain unaffected so long as plaintiffs have a right to demand that their government ‘steer clear’ of aiding discrimination in local educational facilities and contend, as plaintiffs do here, that current gov- 15 eminent (IRS) practice does not meet the “ steer clear’ standard” (Interv. Pet. App. B 22b n.27). Respondents’ asserted right to be free of government aid to racial discrimination is an undifferentiated right common to all members of the public that will not support standing to sue Treasury officials in an Article III court. See United States v. Richardson, 418 U.S. 166, 176-180 (1974). The fact that re spondents may have an interest in a matter that they have sought to identify as a public issue, and that they may share certain attributes common to per sons who may have suffered discrimination at the hands of private schools, is an insufficient ground upon which to conclude that they have been injured in fact by such discrimination or that the Secre tary’s allegedly illegal conduct has actually caused such discrimination. Wafth v. Seldin, supra, 422 U.S. at 502. In short, respondents are “ individuals who seek to do no more than vindicate their own value preference through the judicial process.” Sierra Club v. Morton, 405 U.S. 727, 740 (1972). See also O'Shea v. Littleton, 414 U.S. 488, 493-496 (1974); Moose Lodge No. 107 v. Irvis, 407 U.S. 163, 166-168, 171, 178 (i972). c. In refusing to follow Eastern Kentucky, the court of appeals declined to “ search for a grand solution that will unclutter this area of the law and lead to secure, evenhanded adjudication” (Interv. Pet. App. B 16b). Rather, it “ select[ed] from two diver gent lines of Supreme Court decision [s] the one [it] believe[dj best fit[] the case before [ it ]” and con cluded that there was precedent to support the prop osition that “black citizens have standing to com plain against government action alleged to give aid or comfort to private schools practicing race dserim- ination in their communities” (ibid.). 16 But the iaw of standing does not turn upon the racial characteristics of the plaintiff or the substan tive issues raised by the complaint. “ Unlike other associated doctrines, for example, that which re strains federal courts from deciding political ques tions, standing ‘focuses on the party seeking to get his complaint before a federal court and not on the issues he wishes to have adjudicated.’ ” Simon v. Eastern Ky. Welfare Rights Organization, supra, 426 U.S, at 37-38, quoting from Flast v. Cohen, 392 U.S. 83, 99 (1968). See also Wairth v. Seldin, supra, 422 U.S. at 517-518; Schlesinger v. Reservists to Stop the War, 418 U.S. 208, 225-227 (1974). Hence, re spondents are subject to precisely the same require ment as any other plaintiff and therefore must allege “ ‘such a personal stake in the outcome of the contro versy as to warrant [their] invocation of federal- court jurisdiction and to justify exercise of the court’s remedial powers on [their] behalf’ ” . Worth v. Seldin, supra, 422 U.S. at 498-499, quoting from Baker v. Carr, 369 U.S. 186, 204 (1962). There are, moreover, no “ divergent lines of Su preme Court decision” (Interv. Pet. App. B 16b), as the court of appeals mistakenly believed, that “ point] ] in opposite directions” {id. at 15b-16b), or that cast doubt upon the standing analysis of Eastern Kentucky. In proposing its novel hypothesis that black citizens can more easily invoke federal- court jurisdiction to remedy alleged governmental aid to private discrimination without demonstrating injury and a nexus between injury and the defend ant’s conduct, the decision below relied on Green v. Kennedy, 309 F. Supp. 1127 (1970), continued, 330 F. Supp. 1150 (D.D.C.), aff’d, 404 U.S. 997 (1971); 17 Norwood v. Harrison, 418 U.S. 455 (1973); and Gilmore v. City of Montgomery, 417 U.S. 556 (1974). But none of those cases warrant, much less dictate, the conclusion that respondents have standing to bring this suit. Neither the Court’s summary affirm ance in Green nor its opinion in Norwood v. Har rison addressed the standing of the plaintiffs in those cases. Indeed, unlike this case where the respond ents’ quarrel with the Internal Revenue Service is over the effectiveness of its enforcement proceedures rather than its substantive position,7 the Green litiga tion was initiated to obtain a ruling that racially discriminatory schools were not entitled to tax exemption under Section 5 0 1 (c )(3 ). There, the plaintiffs identified in their complaint specific private schools in their communities “ from which Negro stu dents [were] excluded on the basis of color” (Interv. Pet. App. B 4b). Moreover, because the Service adopted the complainants’ position in the midst of the litigation, “ the Court’s affirmance in Green lacks the precedential weight of a case involving a truly ad versary controversy.” Bob Jones University v. Simon, 416 U.S. 725, 740 m il (1974).8 Norwood v. Harrison, supra, is similarly inap posite on the question of standing. There, the Court 7 We are advised that the Internal Revenue Service has revoked the tax exemption of more than 100 private schools that have failed to adopt and publicize racially nondiscrimina- tory policies. 8 The appeal in Green was taken by intervenors appealing from an order denying their motion to set aside the district court’s previous order. The intervenors sought to vindicate their asserted right to freedom of association. See Motion to Dismiss or Affirm, Coit V. Green (No. 820, 1970 Term). 18 struck down, a state program under which students borrowed textbooks without regard to- whether the students attended private schools with racially dis criminatory policies. As the Court subsequently ex plained in Gilmore v. City o f Montgomery, 417 U.S. 556, 570-571 n.10 (1974), “ [t]he plaintiffs in Nor wood were parties to a school desegregation order and the relief they sought was directly related to the con crete injury they suffered.” The same observation is equally applicable to Gil more, which was related to a prior class action to desegregate public parks and recreational facilities. Indeed, contrary to the decision below, the Court’s discussion of standing in Gilmore fully supports our submission that all plaintiffs must meet the tradi tional requisites of standing to invoke _ federal-court jurisdiction. As the Court stated, “ [w] itliout a prop erly developed record, it is not clear that every non exclusive use of city facilities by school groups, un like their exclusive use, would result in cognizable injury to these plaintiffs. The District Court does not have carte blanche authority to administer city facili ties simply because there is past or present discrim ination. The usual prudential tenets limiting the exercise of judicial power must be observed in this case as in any other (ibid.).” See also Warth v. Sel- din, supra. 2. a. The broad authority that Congress has given the Secretary of the Treasury and the Commissioner of Internal Revenue over the administration of the tax laws shows that it did not intend the courts to entertain suits of this kind. To adjudicate respond ents’ generalized claims, a broad-scale inquiry into the enforcement practices of the Internal Revenue Service, as well as into the racial policies of an in definite number of private schools, would be re 19 quired.” The role respondents would assume and have the court assume, “ as virtually continuing moni tors of the wisdom and soundness of Executive ac tion,” Laird v. Tatum, 408 U.S. 1, 15 (1972), be longs to Congress in the exercise of its oversight function over the operation, administration, and effects of the internal revenue system (see Sections 8021 through 8023 of the Internal Revenue Code of 1954) and to the President, who, along with the Treasury officials, is required to “ take Care that the Laws be faithfully executed.” United States Consti tution, Article II, Section 3; 26 U.S.C. 7801(a), 7805(a). Absent an assertion of concrete and reme diable injury directly attributable to unlawful gov ernment action, the judiciary should not assume the “ amorphous [task of] general supervision of the operations of government * * United States v. Richardson, supra,, 418 U.S. at 192 (Powell, J., con curring) ; Schlesinger v. Reservists to Stop the War, 418 U.S. 208, 217-223 (1974). Indeed, the structure for the adjudication of tax disputes shows that Congress established precisely defined channels for the conduct of the litigation that do not permit third parties such as respondents to challenge the tax treatment of others. The federal district courts and the Court of Claims have jurisdic tion over actions by the affected taxpayer for re funds of taxes paid. 26 U.S.C. 6532, 7422; 28 U.S.C. 1346, 1491. And the Tax Court has been granted jurisdiction to review deficiency determinations with respect to income, estate, or gift tax, at the behest 9 9 We are advised by the Internal Revenue Service that there are approximately 20,000 private schools in the United States currently recognized as, or claiming to be, tax-exempt under Section 501(c) (3) of the Internal Revenue Code. 20 of the affected taxpayer. 26 U.S.C. 6212, 6213. In order to confine tax litigation to these prescribed avenues of review, Congress has generally prohibited “ any person, whether or not such person is the person against whom such tax was assessed,” from main taining a “ suit for the purpose of restraining the assessment or collection of any tax” (26 U.S.C 7421 (a ), the Anti-Injunction Act) and has prohibited declaratory relief in all actions “with respect to Federal taxes” (28 U.S.C. 2201). This Court has repeatedly required that those and other limitations on the channels of tax litigation be strictly enforced so as to accomplish their intended purpose. Louisi ana v. McAdoo, 234 U.S. 627 (1914); Bob Jones University v. Simon, 416 U.S. 725 (1974); Enochs v. Williams Packing Co., 370 U.S. 1 (1962); Flora v. United States, 362 U.S. 145 (1960); Angelus Milling Co. v. Commissioner, 325 U.S. 293 (1945); United States v. Felt & Tarrant Co., 283 U.S. 269 (1931). Moreover, Congress has recently confirmed that the prohibitions against equity suits against the Treasury in tax matters remain fully operative in suits for review7 of agency action. S. Rep. No. 94- 996, 94th Cong., 2d Sess. (1976); H.R. Rep. No. 94- 1656, 94th Cong., 2d Sess. 12-13 (1976). In sum, the structure of our tax system confirms the correctness of Justice Stewart’s observation that he “cannot now imagine a case, at least outside the First Amendment area, where a person whose own tax liability was not affected ever could have standing to litigate the tax liability of someone else.” Simon v. Eastern Ky. Welfare Rights Organization, supra, 426 U.S. at 46 (Stewart, J., concurring). b. Of course, we do not suggest that policies of the Internal Revenue Service should be immune from public inquiry and examination. The broad tax 21 policy questions raised by respondents’ suit are prop erly a matter for public debate. However, the ap propriate forum for such a debate concerning the correctness of Treasury policy is in the Congress pursuant to the exercise of its oversight of the De partment of the Treasury and not in the courts, “Any other conclusion would mean that the Found ing Fathers intended to set up something in the na ture of an Athenian democracy or a New' England town meeting to oversee the conduct of the National Government by means of lawsuits in federal courts,” United States v. Richardson, supra, 418 U.S, at 179. Indeed, public debate has recently been taking place in Congress over the Treasury’s enforcement policies in the area o f tax exemptions of private schools, thereby confirming our submission that re spondents’ suit is not appropriate for judicial resolu tion. The Internal Revenue Service has already sought to supplement its existing procedures for testing the bona fides of the racial policies of private schools by proposing to treat as prima facie discrim inatory schools formed in the wake of desegregation decrees or adjudicated in the past to be discrimina tory (Interv. Pet. App. F lf-13 f; Pet App. G Ig- 14g). Had they been adopted, those proposals appar ently would have gone far toward meeting respond ents’ objections to the current procedures. They pro voked, however, a large volume of adverse testimony before the Internal Revenue Service and Congress, See Tax Exempt Status of Private Schools: Hear ings Before the Subcomm. on Oversight of the House Comm, on Ways and Means, 96th Cong., 1st Sess. (1979). In the wake of the hearings, the House Committee on Appropriations recommended that adoption of the Internal Revenue Service’s proposals be deferred until after the regular taxwriting com 22 mittees of Congress had determined that they rep resented a proper interpretation of the tax laws. H.R. Rep. No. 96-248, 96th Cong., 1st Sess. 14-15 (1979). By means of the so-called Ashbrook and Doman Amendments to the 1980 Treasury Appro priations Act, Congress prohibited the Treasury, for fiscal year 1980, from expending funds to carry out any private school procedure, standard, or guide lines more preclusive than those in effect before August 22, 1978, the date of issuance of the first of the proposed procedures. Sections 103 and 615, Treasury, Postal Service, and General Government Appropriations Act, 1980, Pub. L. No. 96-74, 93 Stat. 562, 576.10 Congress has continued to exercise its oversight authority in this area. After the court of appeals rendered its opinion in this case, in which it observed that the Ashbrook-Doman restrictions then in effect did not purport to control court orders (Interv. Pet. App. B 30b), the House of Representatives added to the 1982 Treasury Appropriations bill a spending restriction that would specifically encompass court orders entered after August 22, 1978.11 See 127 10 The Ashbrook-Dornan Amendment expired on October 1, 1980, the end of the 1980 fiscal year, but was reinstated for the period December 16, 1980, through the close of the 1981 fiscal year, by Sections 101(a )(1 ) and 1 01 (a )(4 ), H.R. J. Res., 644 of Dec. 16, 1980, Pub. L. No. 96-536, 94 Stat. 3166, as amended by Section 401, Supplemental Appropriations and Rescission Act, 1981, Pub. L. No. 97-12, 95 Stat. 95. 11 The House voted to modify the 1980 Ashbrook amend ment by inserting the phrase “court order” to an amendment to the Treasury, Postal Service, and General Government Ap propriations Bill, 1982 (H.R. 4121, 97th Cong., 1st Sess. (1981)). The bill, which has yet to pass both Houses, thus provides in Section 616: None of the funds made available pursuant to the provi sions of this Act shall be used to formulate or carry out 23 Cong. Rec. H5392-H5398 (daily ed. July 30, 1981). The Senate Committee on Appropriations subse quently reported out a spending restriction in iden tical form. Under a joint resolution making continu ing appropriations for the current fiscal year, this provision became effective as of October 1, 1981, at least through November 20, 1981. Section 101(a) (3), H.R. J. Res. 325, Pub. L. No. 97-51, 95 Stat. 958, signed Oct. 1, 1981; see 127 Cong. Rec. H6698- H6699, H6702 (daily ed. Sept. 30, 1981).12 These actions by Congress suggest that it is the ap propriate forum for the resolution of respondents’ quarrel with the Treasury and reinforce the wisdom of “ the basic principle that to invoke judicial power the claimant must have ‘a personal stake in the out come,’ * * *, or a ‘particular, concrete injury’ or ‘a direct injury,’ * * * in short, something more than ‘generalized grievances’ * * *” (citations omitted) United States v. Richardson, supra, 418 U.S. at 179- 180. any rule, policy, procedure, guideline, regulation, stand ard, court order, or measure which would cause the loss of tax-exempt status to private, religious, or church- operated schools under Section 501 (c) (3) of the Internal Revenue Code of 1954 unless in effect prior to August 22, 1978. 12 Those congressional restrictions are prospective in opera tion and therefore do not impair the Commissioner’s right to use his existing guidelines and procedures established prior to August 22, 1978 ( e . g Rev. Proc. 75-50, 1975-2 Cum. Bull. 587), to deny tax benefits to schools not operating under a bona fide nondiscriminatory policy. See Bob Jones University v. United States, 639 F.2d 147, 150, n.3 (4th Cir. 1981), cert, granted, No. 81-3 (Oct. 13, 1981). See also Interv. Pet. App. B 26b & n.35, 27b-28b, n.40). 24 CONCLUSION The petition for a writ of certiorari should be granted. Respectfully submitted. November 1981 Rex E. Lee Solicitor General John F. Murray Acting Assistant Attorney General Stuart A. Smith Assistant to the Solicitor General Michael L. Paup Ernest J. Brown Robert S. Pomerance Attorneys la APPENDIX Constitution of the United States of America Article III. * * * * Section 2. The judicial Power shall extend to all Cases, in Law and Equity, arising under this Con stitution, the Laws of the United States, and Treaties made, or which shall be made, under their Authority;— to all Cases affecting Ambassadors, other public Ministers and Consuls ;— to all Cases of admiralty and maritime Jurisdiction;— to Contro versies to which the United States shall be a Party;— to Controversies between two or more States;— be tween a State and Citizens of another State;— be tween Citizens of different States,— between Citizens of the same State claiming Lands under Grants of different States, and between a State, or the Citizens thereof, and foreign States, Citizens or Subjects. * * * * * Internal Revenue Code of 1954 (26 U .S .C .): Section 170 C h a r it a b l e , e t c ., Co n tr ib u tio n s a n d G if t s . (a) Allowance of Deduction.— (1) General rule.— There shall be al lowed as a deduction any charitable con tribution (as defined in subsection ( c ) ) pay ment of which is made within the taxable year. A charitable contribution shall be al lowable as a deduction only if verified under regulations prescribed by the Secretary or his delegate. * * * * * 2a (c) [as amended by Section 201, Tax Re form Act of 1969, Pub. L. No. 91-172, 83 Stat. 487] Charitable Contribution Defined,— For pur poses of this section, the term “ charitable con tribution” means a contribution or gift to or for the use of— (2) A corporation, trust, or commu nity chest, fund, or foundation— (A ) created or organized in the United States or in any possession thereof, or under the law of the United States, any State, the District of Co lumbia, or any possession of the United States; (B ) organized and operated ex clusively for religious, charitable, sci entific, literary, or educational pur poses, or to foster national or interna tional amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment) or for the prevention of cruelty to children or animals; (C) no part of the net earnings of which inures to the benefit of any pri vate shareholder or individual; and (D ) which is not disqualified for tax exemption under section 501(c) (3) by reason of attempting to influence legislation, and which does not parti cipate in, or intervene in (including the publishing or distributing of state ments), any political campaign on be half of any candidate for public office. 3a A contribution or gift by a corporation to a trust, chest, fund, or foundation shall be deductible by reason of this paragraph only if it is to be used within the United States or any of its possessions exclusively for purposes specified in subparagraph (B) . ^ a(i ☆ GOVERNMENT PRINTING OFFICE; 1 9 8 1 3 5 8 3 0 6 6 9 6