UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

ACORN; ACORN INSTITUTE, INC.; and NEW YORK ACORN HOUSING COMPANY, INC.
Plaintiffs,
versus
UNITED STATES OF AMERICA; SHAUN DONOVAN, Secretary of the Department of Housing and Urban Development; PETER ORSZAG, Director, Office of Management and Budget; and TIMOTHY GEITHNER, Secretary of the Department of Treasury of the United States
Defendants

CIVIL ACTION NUMBER

COMPLAINT FOR INJUNCTIVE AND DECLARATORY RELIEF

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PRELIMINARY STATEMENT 1. This action seeks declaratory judgment that an Act of Congress - Continuing
Appropriations Resolution, 2010, Division B of Public Law No. 111-68 - is unconstitutional and seeks an order enjoining its enforcement. This Act de-funds and debars the Plaintiff ACORN and any civil rights and social justice organizations and allied or affiliated with the ACORN from receiving any federal grants or funds or from participation in federal programs. 2. This Act of Congress is unconstitutional due to the fact that Section 163 of the Act (hereinafter "Sec. 163") constitutes a bill of attainder within the meaning of Article I, Section 9 of the Constitution of the United States. As well, it violates the First and Fifth Amendments of the Constitution. 3. Section 163 states in pertinent part:
"Sec. 163. None ofthe funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now (hereafter "ACORN"), or any of ACORN'S affiliates, subsidiaries, or allied organizations. " 4. Section 163 went into effect on October 1, 2009. On October 31, 2009 it was extended and is currently due to expire on December 18, 2009, unless, as it has been before, it is extended again. 5. The history, Congressional intent and particularized context of the aforementioned legislation reveals a malicious and punitive intent against, and a singling out of the Plaintiffs that arises from the heavily funded and orchestrated political campaign against
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the Plaintiffs, referenced below. As such, this legislation constitutes a bill of attainder, forbidden and prohibited by Article I, Section 9 of the Constitution of the United States and therefore in violation thereof. 6. The nonpartisan Congressional Research Service, an agency within the Library of Congress, warned Congress in a written report on September 22, 2009 titled "The Proposed 'Defund ACORN Act': is it a 'Bill ofAttainder'" (CRS Report 7-5700 authored by Kenneth R. Thomas) that singling out ACORN, as it has since been in Sec. 163, may well constitute an unconstitutional bill of attainder. 7. Notwithstanding the concerns of the Congressional Research Service, as well as similar warnings by other members of Congress, the majority of Congress went forward and enacted Sec. 163 anyway. 8. Currently the Code of Federal Regulations contains extensive regulations that provide for a comprehensive regulatory scheme to address federal contractors or grantees who are accused of fraud or misconduct. 9. Nonetheless, in Section 163, Congress has specifically bypassed the regulations found in the Code of Federal Regulations, referenced above, and instead peremptorily singled out ACORN and the Plaintiffs herein. In so doing neither Congress nor defendants have provided any notice or hearing before or after the deprivation wrought as a direct result of Section 163. 10. In addition to the fact that this legislation constitutes a bill of attainder, it also violate the Plaintiffs' rights, secured by the First Amendment of the United States Constitution, as well as the Plaintiffs' rights to due process, as secured by the Fifth Amendment of the United States Constitution.
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JURISDICTION AND VENUE II. This court has jurisdiction pursuant to 28 USC, Section 1331 (federal question
jurisdiction) and 28 USC, Section 220 I (Declaratory Judgment Act). 12. Article I, Section 9 of the Constitution specifically forbids Congress from passing a bill
of attainder. 13. This action is brought directly under Article I, Section 9 and the First and Fifth
Amendments to the Constitution of the United States. 14. Venue is proper in this court pursuant to 28 USC, section 1391 (a)(2) and 28 USC,
Section 1391(e)(2) due to the fact that many of the actions, transactions, misconduct by Defendants have taken place in the Eastern U.S. District of New York. Further, one of the Plaintiffs' principal places of business is in Brooklyn, New York, in the Eastern District.
PARTIES Plaintiffs .15. Plaintiff Association of Community Organizations for Reform Now, commonly known as
"ACORN," (hereafter "ACORN") is a non-profit Arkansas corporation which exists for the purpose of organizing low- and moderate-income people to achieve social and economic justice. It has 500,000 members located in 75 cities across the United States. ACORN's national offices are located at 2 Nevins Street, Brooklyn, New York; Washington, D.C.; and New Orleans, Louisiana. a. since the continuing resolution was passed by Congress, ACORN has had to layoff
employees;
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b. ACORN has closed offices and drastically reduced services to low and moderate income people across the United States;
c. ACORN programs have been slashed. For example, in September 2009, the New York first time homebuyer education classes enrolled 100 first time homebuyers. In October, due to budget and staff cutbacks, it enrolled 7 people.
d. ACORN has been penalized by Congress without an investigation. ACORN was never even the subject of a hearing in Congress. ACORN has not given any notice that the organization had to do anything or take any action before funds would be terminated. ACORN funds were just cutoff by Congress.
e. Many organizations partnering with ACORN cut off relationships with ACORN for fear of being tainted by association with ACORN. ACORN has been advised that other organizations are concerned about the federal cutoff language which prohibits funds to "ACORN or any of its affiliates, subsidiaries or allied organizations" being interpreted to include non affiliated organizations which are independent but work with ACORN even though no federal funds are distributed to ACORN through the relationship.
16. Plaintiff ACORN Institute, Inc. (hereafter "AI") is a not-for-profit corporation, incorporated in Louisiana, certified by the Internal Revenue Service as tax-exempt under Section 501(c)(3) of the Internal Revenue Code. a. AI works on civil rights, employment, housing, and social service issues in lowincome communities. b. AI has a separate corporate existence from ACORN, with a separate board of directors and separate management. There is no overlap between the governing
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board of directors of AI and ACORN except that one of the members of AI's Board is also an alternate national director of ACORN' board. Only AI's board has the power to hire and fire its Executive Director. c. In practice, the AI and ACORN collaborate closely and AI gets many grants which it contracts with ACORN to carry out. For example, in conjunction with ACORN, AI operates a countrywide network of "ACORN" Centers which provide free tax preparation, benefits enrollment, and foreclosure prevention servIces. d. Among the grants it has received are Resident Opportunities and Supportive Service ("ROSS") grants administered by the U.S. Department of Housing and Urban Development ("HUD") e. Under these grants, AI, through ACORN, performs outreach and education activities in public housing projects, including financial literacy training. f. Through this training, public housing residents learn how to build good credit, avoid predatory lenders, and develop immediate and long-term money management skills. g. AI has also received grants under the HUD Fair Housing Initiative Program. h. AI's offices are located at 2609 Canal Street, New Orleans, Louisiana. 1. No grant which AI has received and administrated has ever been alleged to have been involved in any misconduct or illegal conduct. AI has never been indicted of any crime, nor has any AI employee ever been indicted of a crime in conjunction with any work they have done for AI. AI has never been denied any grant from any federal agency due to alleged misconduct.
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J. As a result of the actions of the Defendants herein, taken pursuant to Section 163 and adverse to the Plaintiffs herein, extensive funding for AI's activities, numerous contracts and contract opportunities have all been cancelled or withdrawn (see below for specific examples).
k. Further, as a result of the actions of the Defendants herein, adverse to the Plaintiffs herein, the cut off of all federal funds pursuant to Section 163 has decimated AI. As of September 2009 AI employed 20 employees. As oftoday, a little over a month later, AI has two or three employees. It has been forced to layoff close to 85% of its employees.
17. Plaintiff NEW YORK. ACORN HOUSING CO., INC. (hereafter "HOUSING) is organized as a not-for-profit corporation in New York, and has tax-exempt status under Section 501 (c) of the Internal Revenue Code. It does the following: a. NYAHC owns, develops and manages housing affordable to low income families. It controls or manages over 140 buildings with over 1200 apartments in all boroughs of New York except Staten Island. b. At no time has NYHAC ever been accused, let alone convicted of any crime. Nor has any employee or agent of NYHAC ever charged or convicted of a crime while acting within the scope of their employment; c. As a result of the suspension of funding to ACORN and ACORN affiliates resulting from the passage of Continuing Appropriations Resolution, 2010, Division B of Public Law No. 111-68 (Section 163) NYARC has been forced to suspend all new intakes of first time home buyers and mortgage foreclosure cases due to: Suspension or withdrawal of funding for the ACORN Housing
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Corporation First Time Homebuyer Education Program and the Housing Mortgage Foreclosure Counseling (HMFC) Program; and Suspension or withdrawal of funding and programs from partner banks (Citibank, Chase, Bank of America) that had provided mortgage and financing assistance for ACORN Housing Corporation clients. d. The CR has also caused the banks with which we have consistently worked (list, etc and describe the work) to, in turn, suspend their funding of our programs, as set forth below. The reason that these banks have given for suspending these programs is that ACORN Housing Corporation has no "pipeline" of new clients in need of mortgage and financial assistance due to the reduction in ACORN operations brought about as a result of the budget suspension (Section 163) offederal funds. e. Since NYAHC's operations have been suspended it no longer has the names of, or relationship with people whom it represents, in need of mortgages or financing assistance. It therefore no longer has a "pipeline" and cannot seek participation from the aforementioned banks. f. In addition, these banks have stated that they fear being prevented from participating in programs financed, in whole and in part, by the federal government. They state hat these fears are derived from the Federal ban on any entity that is "affiliated" with or "allied" to ACORN, such as NYAHC. Therefore they tell us, they have discontinued any relationship, including funding and joint programs, with NYAHC.
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g. Furthermore, grants that NYHAC has in the past received from the Center for New York City - over the past two years, totaling approximately $340,000 have been suspended. This sum is comprised of close to $250,000 to pay for loan counselors and $90,000 for outreach. As a consequence, NYHAC will, in the very near future, be forced to take the following steps, adverse to our program and mission: NYAHC supervised staff will have to be laid off; The over 2,000 families that NYARC counsels will now have the following problems and issues: They will be at risk for predatory and subprime lending scams; They will not have the benefit of NYARC's default counseling program and will be more susceptible to the risk offoreclosure. (Ironically, this will especially adversely effect those referenced in Paragraph 1O(b)(i) above, who have fallen prey to unethical lending scams due to the discontinuation ofNYAHC funding.) They will receive no counseling to prepare them for homeownership; They will not have the opportunity to obtain special products that will assist them to become new home buyers including PMI (Private Mortgage Insurance); lower interest rates; grants to assist with down;
h. NYAHC's current counseling pipeline, which now has over 1,500 cases will have to be shut off and those families will be forced into a Catch 22 - either negotiate directly with the banks for a modification or go to the costly and ineffective private sector (or just lose their homes).
i. Over the past ten years, NYARC has purchased 3 separate housing developments from HUD and, as a result, saved 345 apartments and residents
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from eviction, relocation and/or escalating rents. Two of these three developments have Housing Assistance Program (HAP) contracts for project based Section 8 to help very low income families pay the rent. As a result of the aforementioned funding suspensions and threatened funding suspensions, above referenced, the ability ofNYAHC to maintain these developments, is gravely endangered. Almost all of these buildings (close to 150) have some HOME (federal funds that are passed through the city/municipality) mortgages - 0% or 1% mortgages. These mortgages allow NYAHC to develop housing that is affordable to very low income families, and allow NYAHC to keep this housing affordable indefinitely. We have buildings in our pipeline, that were developed and rehabilitated as far back as 1989 and that are now endangered, in that they may no longer be a part of this program. j. NYAHC had been awarded a grant from the Division of Housing and Community Renewal of the State of New York (DHCR), for another significant foreclosure prevention project. Much of this grant was for outreach. This outreach project consisted of phone calling, door knocking and other forms of outreach to identifY homeowners in default or at risk of foreclosure .This funding has currently been suspended. k. The New York State Housing Finance Agency (HFA) - hadlhas also subcontracted with NYAHC to do work designed to prevent foreclosures. This has allowed NYAHC to pay additional staff to do the necessary counseling. These funds have now been suspended due to the federal funding suspension of the activities of ACORN and ACORN affiliates. As a result the
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foreclosure work previously done on behalf of numerous families has been indefinitely discontinued.
Defendants 18. The UNITED STATES OF AMERICA is made a defendant in that the actions and
inactions complained of herein are the result of unconstitutional actions of members of Congress in passing an unlawful bill of attainder; 19. Defendant SHAUN DONOVAN is the Secretary of Housing and Urban Development. As such he is sued in his official capacity. 20. Defendant PETER ORSZAG is the Director of Office of Management and Budget of the United States. As such, he is sued in his official capacity. 21. Defendant TIMOTHY GEITHNER is Secretary of the Treasury of the United States, he is sued in his official capacity.
STATEMENT OF FACTS 22. Since 2003, ACORN has helped over two million people register to vote. It has
advocated raising the minimum wage to a living wage in dozens of communities across the country. It works against predatory lending and to stop foreclosures. It has helped over 150,000 people file their tax returns. It has worked on thousands of issues that arise from the predicaments and problems of the poor, the homeless, the underpaid, the hungry and the sick, on the local, state and national level through direct action, negotiation, legislative advocacy and voter participation.
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23. As with all large organizations, undoubtedly some agents, members and employees of ACORN have, over time, made mistakes, most of which have victimized ACORN itself and not the public.
24. ACORN has responded to these mistakes by terminating staff who engaged in misconduct, has re-organized its board of directors, reorganized its national staff, hired new counsel, and even hired the former Attorney General ofthe state of Massachusetts to conduct an internal investigation. ACORN has continually responded to legitimate criticism by putting its financial and administrative house in order.
25. The two million people ACORN registered to vote since 2003 have largely resided in minority communities. Without the work ofthe Plaintiff, ACORN, these people would be otherwise disenfranchised and would not have voted in the last presidential election.
26. Precisely because these previously disenfranchised voters participated in recent elections, ACORN eamed the animosity of political forces who are dedicated to the proposition that the fewer poor people who vote the better.
27. Section 163 was passed in large part due to a public relations campaign orchestrated by political forces that have persistently attacked and defamed the Plaintiff ACORN, its members, affiliates and allies (other Plaintiffs herein), motivated by their hostility toward the Plaintiffs' tireless commitment to registering voters, particularly those poor and working Americans who have been consistently disenfranchised and excluded from the American political system.
28. On September 9, 2008, these same political forces released edited hidden-camera videos in which they posed as a prostitute and her boyfriend in order to elicit responses from ACORN employees (and employees of separate corporations) in several cities regarding
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home loans, taxes and, what they described as underage sex workers trafficked from
outside the u.s.
29. ACORN immediately responded to the videos by launching an internal investigation conducted by the former Attorney General of Massachusetts; and it fired the employees who were featured in the videos.
30. Certain members of Congress, immediately thereafter, undertook a program to punish Plaintiff ACORN, other unnamed "affiliated and allied organizations," and the other Plaintiffs in this action.
31. Despite numerous press reports and congressional, independent, and other governmental investigations of many other scandals involving serious misconduct such as fraud or corruption among government contractors, some of which involved corporations which were convicted of serious crimes, Congress has thus far enacted no laws singling out for suspension or debarment any government contractor, other than the Plaintiffs, herein and their affiliates and allies.
32. Indeed, in the past few years, Congress has specifically refused to enact proposed legislation that would generally bar from federal contracts and funding, corporations with criminal convictions or pending indictments.
33 . This punitive intent against ACORN is evident from the legislative context which led to Section 163's passage, set forth, by way of example, as recited, in part, below: a. On September 14,2009, in proposing ACORN defunding legislation passed by the Senate, Senator Mike Johanns (R-NE) said: "Somebody has to go after ACORN. Well, I suggest today, on the floor of the Senate, that 'somebody' is each and every
u.S. Senator."
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b. Senator Johanns requested that the Executive Summary of a Minority report of one House committee, which was never even adopted by the committee, the deeply flawed report entitled "Is ACORN Intentionally Structured as a Criminal Enterprise? " be made a part of the Congressional Record. This report was authored by the minority staff of a committee for Rep. Darrell Issa, who has been attacking ACORN for years.
c. This 88-page report was prepared for Representative Darrell Issa on behalf of the minority members of one House committee. The "Issa Report", though never adopted or approved by any House committee, much less the House itself, has played a major and influential role during the Congressional debate surrounding and regarding the passage of the "Defund Acorn Act" and Section 163, referenced above,
d. That Report states that "ACORN has committed a conspiracy to defraud the United States."
e. The report contains the following bullet points, among others: 1. "ACORN launders federal money in order to pursue a partisan political agenda and to manipulate the American electorate." ii. "Under the Obama administration, ACORN stands to $8.5 billion in available stimulus funds.
iii. ACORN is a "shell game." IV. Somebody has to "go after" ACORN. v. ACORN is guilty of a conspiracy to "defraud" the United States
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f. Also on September 14, 2009, in the House of Representatives, Representative Dan Burton (R-IN), in an obvious effort to implicate President Obama, said that "[ilt's really interesting to find out that ACORN, which helped the President get elected, was such a strong force for him and whom he congratulated on the support they gave him ... So he's so very close to ACORN."
g. On September 16,2009, the day before the House passed the "Defund ACORN Act," Representatives Steve King (R-IA) and Todd Akin (R-MO) accused ACORN of using millions of taxpayer dollars "to advertise for a political candidate" based on the fact that there was a poster of President Obama poster hanging in ACORN headquarters and called it "a Jeremiah Wright moment."
h. On September 17, 2009, after proposing the Defund ACORN Act in the House on September 17,2009, Representative Darrell Issa (R-CA) says the purpose of the legislation was "to put an immediate stop to Federal funding to this crooked bunch" and to "enact a comprehensive ban on Federal funding for this corrupt and criminal organization. "
34. The charges leveled against ACORN by members of Congress such as that it is a "criminal enterprise", or a "corrupt and criminal organization", or a "crooked bunch" are false.
35. On October 1, 2009, Public Law 111-68 was approved. Included in that law was Division B- Continuing Appropriations Resolution, 2010. In that resolution, the Section applied to ACORN is Section 163. It reads:
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"Sec.163. None of the funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now (ACORN), or any of its affiliates, subsidiaries, or allied organizations." 36. The aforementioned Continuing Resolution, including Section 163 was amended to remain in force until December 18,2009 pursuant to a law known as Further Continuing
Appropriations Resolution, 2010, HR. 2996, 111th Cong. (2009) (enacted), Division B of
Pub. L. No. 111-88. The prohibition contained in Section 163 therefore continues in effect until December 18,2009. Therefore, for purposes of clarity, within this Complaint, this legislation will continue to be designated as "Section 163." 37. Dozens of members of the U.S. House of Representatives and of the U.S. Senatelegislators have who refused to even authorize an investigation into federally funded organizations and corporations whose employees are charged with murder or to vote for a bill which would root out fraud in defense contracts where major corporations have been found to have committed upwards of 18 acts of misconduct -- have unconstitutionally voted to summarily strip ACORN and all of its affiliates, subsidiaries, and "allied organizations" of all federal funds, thereby essentially eviscerating this critical advocate for poor and working peoples' rights. 38. In response to Section 163 and the actions of Congress, Defendant ORSZAG, acting in his official and in concert with the other Defendants herein, has enforced the unconstitutional Section 163 during its implementation and will continue to do so by ordering that federal executive departments and agencies do the following:
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a. that they may not obligate or award any Federal funds during future periods to ACORN, or any of its affiliates, subsidiaries or allied organizations during the period of the implementation of Section 163;
b. that the prohibitions of Section 163 to apply not only to the funding that is made available by the Continuing Resolution, but also to the funding that was made available by previously enacted statutes;
c. therefore, to the extent that any such agency or executive department has already determined that there is an obligation to fund ACORN or its affiliates but has not yet entered into any agreement to provide such funds to ACORN or any of its affiliates, that agency may not provide such funds, or enter into any such agreements to do so;
d. that grant and contractual payments for work already done, and that performance of all obligations, including payment of federal funds, be immediately suspended;
e. Because Section 163 broadly requires that no funds may be "provided," departments and agencies are to assure and take steps so that no federal funds awarded to other entities are awarded or obligated by such grantees or contractors to ACORN or its affiliates, as subgrantees, subcontractors, or other subrecipients;
f. that the departments and agencies are to notify all Federal grant and contract recipients of the prohibition contained in Section 163, and provide them with a copy of the guidance document prepared by Defendant ORSZAG, which details the sanctions and prohibitions, set forth in this paragraph;
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g. that the departments and agencies must advise all, Federal grant and contract recipients:
h. not to provide Federal funds to ACORN or its affiliates as subgrantees, subcontractors or other subrecipients, consistent with the guidance document prepared by Defendant ORSZAG, which details the sanctions and prohibitions, set forth in this paragraph; and
.1. to notify them (the Agency or Department) of any existing subgrants, subcontracts or other subrecipient agreements with ACORN or its affiliates; and
j. that the departments and agencies require their grantee or contractor to advise them as to how that grantee or contractor is planning to comply with the prohibitions of Section 163 with respect to those subgrants, subcontracts or subrecipient agreements.
39. As a result of the passage of Section 163 and the actions of the Defendants in enforcing it, as set forth above, the Plaintiffs have suffered the loss of income, contracts and contract opportunities, specifically: a. Plaintiffs' applications for contracts with federal agencies have been summarily rejected. For example: i An application with the Environmental Protection Agency for a three year $780,000 grant for outreach to poor communities, to raise awareness of and educate about the lung disease asthma was rejected. UCLA was to be the project coordinator and the work would have been done by ACORN staff.
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ii An application to set up public computer centers in five different cities to train poor people on basic computer skills was rejected.
b. One of the Plaintiffs, AI, had a grant with FEMA to conduct home fire safety assessments in private homes to determine whether the homes were protected, and if not, provide free of charge, to poor people living in those homes, various devices to ensure that their houses would be safe. The same work had been done by plaintiffs during the past year and FEMA had awarded slightly less than $1,000,000 for past and ongoing work in the future, including the current period, and beyond. AI was informed on September 25, 2009 that it had been awarded that grant. In early October 2009, before AI had a chance to draw down on the funds, it was informed by FEMA that it had suspended the contract and that AI would not be permitted to start the work previously agreed upon. Because of this suspension, AI had to layoff six employees who were engaged in the home fire safety assessments.
c. Plaintiffs, including AI, had various existing contracts and agreements with HUD which have been suspended and/or terminated as a result of the CR and Defendant Orszag's OMB memo. Those grants and OMB circular A-IIO that they reference provide for agency termination or suspension only for justifiable cause, such as if the grantee materially fails to comply with the terms or conditions of the award. For example, plaintiffs had agreements with HUD under which they conduct tax preparation and leadership development classes for public housing residents to obtain GED degrees. Plaintiffs had been operating these programs to the satisfaction of HUD, with no complaints or allegations of misconduct concerning Plaintiffs' work on these contracts. Nonetheless, in violation fo
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plaintiffs rights under their contractual agreements and under the applicable

regulations, HUD immediately terminated and lor suspended these contracts in

early October pursuant to the CR and Defendant Orszag's memo.

d.

AI obtained reimbursement on these contracts by first doing the work and

then drawing down the funds in the grant by accessing an automated system and

putting in its password which allows it to obtain funds to pay workers who have

done the work. As of the beginning of October, 2009, $8 - 9,000 was owed

Plaintiffs for work done on these contracts. At that time, reimbursement was

terminated. As a result, Plaintiffs have been forced to cancel GED classes in the

middle of the class and is unable to do any of the work for these public housing

residents.

e. In several cases, Plaintiffs had applied for grants as subcontractors with groups

that already had federal funding. Plaintiffs had been informed by those groups that

they, the Plaintiffs would likely receive the grant upon the signing of the contract.

However, due to Section 163, Plaintiffs were informed in early October that they

would not be permitted to sign such contracts or enter into such subcontracts. For

example:

1. One of these grants was for a United States Department of Agriculture

grant to do work in the state of Washington so as to outreach to poor

people to inform them of their eligibility for food stamps and

supplemental nutrition assistance. For that program, the contractor

("Reach") subcontracted with Plaintiff AI to do approximately $90,000

worth of work. Plaintiff AI had been subcontracted to do this work during

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the past year and had done the work to the satisfaction of the contractor and the government agency in question. Thus the contractor had decided to continue to subcontract with the Plaintiff to continue this work for the coming year. Before the Plaintiff could sign the continuation contract for 2009, however, in early October, they were informed that the agreement to have AI do the work had to be cancelled because of Section 163 and the consequent ac. As a result, Plaintiff had to layoff the employees who would have carried out this work. 11. Plaintiffs had an agreement with a contractor in California, for about $150,000, to do work on the same type of program, as referenced in Paragraph 41(e)(i) above. Again, the contractor and the agency were satisfied with the Plaintiffs' performance and were poised to sign a new contract. However, due to Section 163 and the actions of the Defendants, Plaintiffs were not allowed to continue the project for the following year, 2009. 40. As set forth above, the executive branch of the federal government is legally obligated, authorized and mandated to ensure the integrity of federal programs by conducting business with responsible parties. The law provides a variety of methods and mechanisms for so doing, to wit: a. Government contractors can be debarred or suspended under federal statutes or under the Federal Acquisition Regulation, an administrative rule which governs contracting by executive agencies.
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b. Federal agencies maintain oversight over the competitive federal grant process and maintain full oversight for each disbursement of federal grant funds .
c. There is a competitive grant process in place with a framework both of governmentwide and agency specific regulations by which the government can exclude contractors from receiving federal funding.
d. The Code of Federal Regulations (CFR) provides the Office of Management and Budget (OMB) extensive regulation and guidance for federal agencies regarding government-wide debarment and suspension of eligibility for government grants.
e. Under the CFR guidelines, an agency may impose suspension or debarment based on a variety of bases including when it detennines that there has been an indictment, . conviction, civil judgment, or official finding by federal, state, or local bodies that detennine factual and/or legal matters, and immediate action is necessary to protect the public interest.
f. The regulatory process includes notice, adequate investigation, and an opportunity to contest, and may result in suspension or debarment for a specified period oftime or until there is compliance with the specific finding.
41. The actions that led up to and included the passage of Section 163, as referenced above, all share the following characteristics: a. they are devoid of impartiality and lack general applicability; b. they have targeted and singled out the Plaintiffs, and are therefore do not partake of generality in application and impact - indeed they are specifically tailored and designed to effect and/or punish the Plaintiffs and only the Plaintiffs, in that they
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specifY the group and/or groups of people upon whom the prescribed sanction is to be levied; c. they are inconsistent with the Federal Regulations set forth above and with the remedial intent and framework that those regulations are premised upon; d. they are propelled by and enacted as a result of punitive intent; e. they are infused with punitive impact and effect; and f. they arrogate the task of adjudication to Congress rather than leaving it, as it must be left, to other tribunals.
CLAIMS COUNT I Article I, § 9, Cl. 3 Bill of Attainder 42. Plaintiff incorporates by reference the allegations set forth in Paragraphs 1 through 37 as if fully set forth herein. 43. Article I, Section 9, cl. 3 of the Constitution of the United States is one of the crown jewels of the founding instrument of our nation. It explicitly provides that "No bill of attainder or ex post facto law shall be passed." 44. While its concerns are addressed more generally, in spirit, by other provisions of the Constitution, such as the due process clause of the Fifth Amendment (see below), the prohibition against bills of attainder was specifically incorporated before the Bill of Rights was drafted due to the founders' very concrete concerns and fears of the possibility oflegislative tyranny, which they had personally experienced while still British colonists.
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45. The prohibition against bills of attainder contained in clause, Art. I, §9, cl. 3, along with its companion prohibition against ex post facto laws, was enacted to ensure that Congress not single out individuals or groups and declare them guilty, nor inflict punishment after trial by legislature. Rather the Constitution sought to secure some degree of certainty, uniformity and fairness in our government and in our governmental process.
46. As noted above, there are already significant existing regulations which set forth careful guidelines for determining whether, and how, specified federally-funded entities can be excluded from various government programs.
47. By enacting Section 163, Congress has adjudged ACORN guilty of the allegations of fraud, misconduct and other illegal conduct.. By extending its funding ban not only to ACORN but to all "affiliated" and "allied" organizations, Congress has adjudged those organizations guilty as well.
48. Further, Section 163's total bar to funding allows no mechanism for the Plaintiffs to demonstrate that they have cured or corrected any alleged wrongdoing.
49. Congress, in enacting Sec.163, bypassed the regulations and acted in a manner inconsistent with those regulations. The legislation and the system which it puts in place, lack the following: a. consistency with fed regulations; b. any semblance of due process; c. any regard, appreciation or understanding that separate groups and organizations have separate identities, interests, structures and characteristics;
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d. any discretion to give the any of the affected organizations, including the Plaintiff organizations herein, an opportunity to correct or cure any alleged misconduct or wrongdoing;
e. a mechanism, appeal or ability to reevaluate this determination of debarment and suspension.
50. The system, described above, contradicts the system of agency due process also set forth above and is in direct conflict with that system.
51. Given this disregard, contradiction and conflict, the only conclusion that can reasonably be drawn, within both the legislative context and the ignored regulatory context, is that the functional purpose of Sec.163 is to punish ACORN and the other Plaintiffs herein.
52. Thus the punitive nature of this legislation indelibly taints it as an unconstitutional and unlawful bill of attainder. The punitive nature ofthe legislation can also be seen in the legislative process that led to its adoption outlined above.
53. As a proximate result of the enactment of this bill of attainder, Section 163, and the actions of the Defendants pursuant thereto and complained of herein, all in violation of Article I, Section 9, cl. 3 of the U.S. Constitution, Plaintiffs herein are imminently and irreparably harmed, including but not limited to the following: a. Extensive funding of Plaintiffs' activities has been cut off; b. numerous contracts and contract opportunities have all been cancelled or withdrawn; c. Plaintiffs' pending applications for federal grants are nullified and will not be reviewed;
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d. Plaintiffs' ability to even prepare or file an application with any agency or department of the federal government has been impaired;
e. Similarly, past, present and future relationships with companies, corporations and other groups, which enter into contracts with agencies of the federal government, have been terminated, disrupted, eliminated and impaired;
f. Other groups, organizations or corporations such as banks and foundations that plaintiffs have dealt with in the past have suspended or terminated their ties with plaintiffs for fear of being tainted by their association with plaintiffs;
g. The Plaintiffs have been forced to discontinue some operations and activities,; and
h. Plaintiffs have been forced to cut payroll, laying off some of their employees.
COUNT II: First Amendment Freedom of Speech and Association 54. Plaintiff incorporates by reference the allegations set forth in Paragraphs I through 49 as
if fully set forth herein. 55. Nowhere in the legislation in question is there any definition, whatsoever, for any of the
relationships set forth in the statute, specifically: "affiliates," "subsidiaries" and "allied organizations." 56. Plaintiffs associate with each other and with other groups or organizations for expressive purposes of furthering their civil rights and social justice goals. 57. As such the legislation adversely affects the well being, operations and activities indeed, the very survival -- of the Plaintiffs which are not ACORN in this action. In this
26

respect, Sec. 163 suffers from a variety of constitutional infirmities, including but not limited to: a. Overbreadth - This legislation is facially overbroad in that it is does not limit its
aim at evils that the govermnent is constitutionally allowed to address but rather sweeps within its ambit a broad array of activities that constitute an exercise of protected expressive and associational activities; and b. Vagueness - This legislation, due to its indefiniteness (i.e. lack of definition) and its uncertainty, provides no way for these Plaintiffs, or any person of common intelligence, to calculate which of their activities may subject them to debarment from the federally funded programs governed by Sec. 163, thus causing the following unconstitutional conditions:
1. Affected organizations which are not ACORN, ("affiliates, subsidiaries and allied organizations") must necessarily guess as to its meaning and differ as to its application; and
ii. It is so vague they cannot determine whether, when and under what circumstances their actions may render them "affiliates," "subsidiaries" or "allied organizations" with ACORN.
58. As a result, these terms prevent political, social, economic, or community based actions or positions that may be viewed as affiliation or alliance with ACORN, whether on a specific or particular issue or position or more generally.
59. Therefore, Sec. 163 will undoubtedly and substantially deter and chill the non-ACORN Plaintiffs herein from any activity that is likely to associate them, in any way with ACORN.
27

60. As such it is designed to chill the non-ACORN Plaintiffs' rights with regard to political, social economic speech, expression and association, including on national local, regional and community concerns.
61. In addition to its design, Sec. 163 has the clear and objective effect of chilling the nonACORN Plaintiffs' rights with regard to political, social and economic speech, expression and association, including on national local, regional and community concerns.
62. It also chills the actions of Plaintiff ACORN in that, since its positions, statements and campaigns may cause it to align, affiliate and associate with other groups, it can no longer do so because those groups are no longer able or willing to so align, associate or affiliate with ACORN, thereby rendering it less capable of expressing itself with regard to political, social economic speech, expression and association, including on national local, regional and community concerns.
63. Sec. 163 also punishes the Plaintiff ACORN in that, since its positions, statements and campaigns may cause it to align, affiliate and associate with other groups, it can no longer do so because those groups are no longer able or willing to so align, associate or affiliate with ACORN, thereby rendering it less capable of expression with regard to political, social economic speech, expression and association, including on national local, regional and community concerns.
64. The actions described herein, leading to and including the enactment of Sec. 163, as well as the past and future actions of the Defendants in carrying out the requirements, mandates and their responsibilities pursuant to and under Sec. 163, constitute a violation
28

of the Plaintiffs' rights to freedom of speech and association as secured by the First Amendment of the United States constitution. 65. As a proximate result of the enactment of this legislation in violation of First Amendment of the Constitution of the United States, Plaintiffs herein are imminently and irreparably harmed, including but not limited to the following:
a. extensive funding of Plaintiffs' activities has been cut off; b. numerous contracts and contract opportunities have all been cancelled or
withdrawn; c. Plaintiffs' pending applications for federal grants are nullified and will not be
reviewed; d. Plaintiffs' ability to even prepare or file an application with any agency or
department of the federal government has been impaired; e. Similarly, past, present and future relationships with companies, corporations
and other groups, which enter into contracts with agencies of the federal government, have been terminated, disrupted, eliminated and impaired; f. The Plaintiffs have been forced to discontinue some operations and activities; and g. Plaintiffs have been forced to cut payroll by laying off some of their employees.
COUNT III: Fifth Amendment Due process 66. Plaintiffs incorporate by reference the allegations set forth in Paragraphs 1 through 65 as
if fully set forth herein.
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67. For reasons specifically set forth above and specifically in Paragraph 58, all re-alleged herein, Sec. 163 is overly broad and vague. Thus, the actions, past and future, of the Defendants in enforcing this legislation, are in furtherance of the overbreadth and vagueness that are inherent in Section 163.
68. Further, as already alleged, there are already pertinent and substantive existing regulations which set forth careful guidelines for determining whether, and how, specified federally-funded entities can be excluded and/or debarred from various government programs.
69. These mechanisms and regulations provide for due process in determining whether and how such entities may be excluded, debarred and/or prohibited from funding for such programs.
70. The breadth of the government-wide ban on contracting and providing grants to ACORN and its affiliates, subsidiaries and allies contained in Sec. 163, completely fails to provide the due process protection, required by the Constitution and provided in the aforementioned regulatory framework.
71. As a result of these considerations, the Defendants have violated and will continue to violate the rights of the Plaintiffs secured by the due process clause of the Fifth Amendment of the United States Constitution.
72. Furthermore, Section 163 and the actions of the Defendants stigmatize the Plaintiffs in ways already set forth herein. Because this stigmatization and as set forth herein, the Plaintiffs have been injured and impaired in their ability to enter into and carry out contracts. As such, the actions of the Defendants in suspending or debarring plaintiffs from all government contracts or grant awards on the basis of stigmatizing allegations
30

have deprived them ofliberty protected by the Due Process Clause of the Amendment. In addition, the suspension and/or termination of the contractual agreements that plaintiffs had with HUD and other federal agencies on the basis of stigmatizing allegations deprives plaintiffs ofliberty protected by the Due Process Clause of the Fifth Amendment. 73. Defendants have violated the Fifth Amendment by depriving plaintiffs of a liberty interest without according them notification of the reasons for the deprivation or any opportunity to contest the deprivation. 74. By terminating ongoing contracts and agreements with plaintiffs that could only be terminated for cause, by refusing to reimburse plaintiffs for expenditures incurred by plaintiffs in connection with work done on these contracts prior to suspension or termination, and by suspending and/or debarring plaintiffs from government contracting, defendants have deprived plaintiffs of a property right without due process of law in violation of the Fifth Amendment. 75. As a proximate result of the enactment oftills legislation and the actions of the Defendants herein, in violation of Fifth Amendment of the Constitution of the United States, Plaintiffs herein are imminently and irreparably harmed, including but not limited to the following:
a. extensive funding of Plaintiffs' activities has been cut off; b. numerous contracts and contract opportunities have all been cancelled or
withdrawn; c. Plaintiffs' pending applications for federal grants are nullified and will not be
reviewed;
31

d. Plaintiffs' ability to even prepare or file an application with any agency or department of the federal government has been impaired;
e. Similarly, past, present and future relationships with companies, corporations and other groups, which enter into contracts with agencies of the federal goverrunent, have been terminated, disrupted, eliminated and impaired;
f. The Plaintiffs have been forced to discontinue some operations and activities; and
g. Plaintiffs have been forced to cut payroll by laying off some of their employees.
IRREPARABLE HARM
76. Plaintiffs incorporate by reference the allegations set forth in previous paragraphs as if fully set forth herein.
77. The actions by Congress violate the United States Constitution in several ways. Violations of the U.S. Constitution constitute irreparable harm to the plaintiffs.
78. The funding cutoff, and the manner in which the legislation has been framed has chilled ACORN's ability to associate with numerous organizations and undercut the ability of ACORN, and associated organizations, to express views, arguments and opinions about issues facing the U.S. electorate.
79. Unless this court declares the actions of Defendants, past and future, unconstitutional, and orders Defendants to reinstitute federal funds with all the regulatory due process protections to which they are lawfully entitled, ACORN and the other Plaintiffs have suffered, continue to suffer and will suffer in the future irreparable harm.
32

PRAYER FOR RELIEF 80. WHEREFORE, plaintiffs respectfully request that the court enter judgment as follows:
a. Issuing a temporary restraining order, a preliminary and permanent injunction restraining Defendants, and all their officers, agents, servants, employees and attorneys from violating the U.S. Constitution by enforcing Section 163 of the Continuing Resolution;
b. Enter judgment ordering Defendants to cease their illegal conduct and reinstitute federal funds for plaintiffs;
c. Enter judgment ordering that Defendant Orszag immediately rescind the OMB memo dated October 7, 2009 and promulgate a memo instructing all federal agencies that there is no bar to the payment of federal funds to ACORN or any ACORN subsidiary, affiliated or allied organization.
d. Issue a Temporary Restraining Order restraining defendants from approving the award of any grant or contract which plaintiffs applied for, but had their application refused or denied because of Defendanfs Orszag's aforementioned memo, until plaintiffs motion for preliminary injunction is decided by the Court.
e. Declare and determine that the actions of defendants are unconstitutional, illegal and null and void;
f. Award reasonable costs and attorney fees in this matter; and g. Order any other such relief as the Court considers equitable, proper and just
under the circumstances.
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Date: November 11,2009, New York, NY
£[Yi?l~
Darius Char~ ~DGJ9)
Center for Constitutional Rights 666 Broadway, 7th Floor New York, NY 10012 (212) 614-6475 dcharney@ccrjustice.org
William Quigley Center for Constitutional Rights Legal Director 666 Broadway, 7th floor New York, NY 10012 bquigley@ccrjustice.org 212.614.6427
Jules Lobel (admitted in NY and this court JL8780) CCR Cooperating Attorney 3900 Forbes Avenue Pittsburgh, PA 15260
Goodman & Hurwitz, P.C. William Goodman (admitted in NY and this court WG1241) Julie H. Hurwitz CCR cooperating attorneys 1394 East Jefferson Detroit, Michigan 48207 313.567.6170
Arthur Z. Schwartz (AZ52683) Schwartz, Lichten & Bright 275 Seventh Avenue New York, NY 10001 212.228.6329
34

VERIFICATION

I, Bertha Lewis, am a resident of Brooklyn NY and I am the CEO and Chief Organizer of

ACORN, Inc., the Association of Community Organizations for Reform Now. I have read this complaint and I do hereby swear that all of the facts contained in this are true and correct to the

best of my knowledge.

Date: I(/1 Ie') 9

I /

.

~n(!J;fore me this II th day of November, 2009.

• giirf

Notary Public, State of New York

No. 02CH6186665

.

Qualified in Kings County

Commission Expires Nov. 14, 2009

Please Serve:
Eric Holder Attorney General of the United States U.S. Department of Justice 950 Pennsylvania Avenue Washington, DC 20530-0001

35

 
 Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 1 of 36

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

ASSOCIATION OF COMMUNITY ORGANIZATIONSFOR REFORM NOW; ACORN INSTITUTE, INC.; and NEW YORK ACORN HOUSING COMPANY, INC.
Plaintiffs,
versus
UNITED STATES OF AMERICA; SHAUN DONOVAN, Secretary of the Department of Housing and Urban Development; PETER ORSZAG, Director, Office of Management and Budget; and TIMOTHY GEITHNER, Secretary ofthe Department of Treasury of the United States,
Defendants.

CIVIL ACTION NUMBER 09-CV-4888 (NG)(LB)

PLAINTIFFS' FIRST AMENDED COMPLAINT FOR INJUNCTIVE AND
DECLARATORY RELIEF

Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 2 of 36
PRELIMINARY STATEMENT 1. This action seeks declaratory judgment that Acts of Congress - (i) Continuing
Appropriations Resolution, 2010, Division B of Public Law No. 111-68, Section 163; (ii) Department of the Interior, Environment, and Related Agencies Appropriations Act of 2010, Division A of Public Law No. 111-88, Section 427; and (iii) the recently enacted Consolidated Appropriations Act of201O, HR 3288, Division A, Section 418, Division B, Section 534 and Division E, Section 511 - are unconstitutional, and seeks an order enjoining their enforcement. These Acts de-fund and de-bar the Plaintiff ACORN and any civil rights and social justice organizations and allied or affiliated with the ACORN from receiving any federal grants or funds or from participation in federal programs. 2. These Acts of Congress are unconstitutional due to the fact that Section 163 of the Continuing Appropriations Resolution (hereinafter "Sec. 163"), Section 427 of the Department of the Interior, Environment, and Related Agencies Appropriations Act of 2010, (hereinafter "Sec. 427"), and Sections 418, 534 and 511 of the Consolidated Appropriations Act of 20 10, H.R. 3288 (hereinafter "Secs. 418, 534 and 511") constitute bills of attainder within the meaning of Article I, Section 9 of the Constitution of the United States. As well, they violate the First and Fifth Amendments of the Constitution. 3. Section 163 states in pertinent part:
"Sec. 163. None of the funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now (hereafter "ACORN"), or any of ACORN'S affiliates, subsidiaries, or allied organizations. "
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 3 of 36
4. Section 163 went into effect on October 1, 2009. On October 31, 2009 it was extended and is currently due to expire on December 18, 2009, unless, as it has been before, it is extended again.
5. Section 427 states in pertinent part: "Sec. 427. None of the funds made available under this Act may be distributed to the Association of Community Organizations for Reform Now (ACORN) or its subsidiaries. "
6. Section 427, which prohibits funding by the Department of Interior, Environment and Related Agencies to ACORN or any of its "affiliates, subsidiaries or allies," went into effect on October 31, 2009, and is in effect for the full fiscal year of20l0.
7. On December 13,2009, Congress passed H.R.3288, the consolidated budget bill for the full fiscal year of 20 10, (two days after Section 163 was judicially declared to be an unconstitutional bill of attainder), including Sections 418,534 and 511. On December 16, 2009, it was signed into law by President Obama, and contains the following unconstitutional provisions: a. Division A, Transportation, Housing and Urban Development, and Related Agencies Appropriations Act, 2010, Title IV, Sec. 418: b. "Sec. 418. None of the funds made available under this Act or any prior Act may provided to the Association of Community Organizations for Reform Now (ACORN), or any of its affiliates, subsidiaries or allied organizations." Division B, Commerce, Justice, Science and Related Agencies Appropriations Act, 2010, Title V, Sec. 534: "Sec. 534. None of the funds made available under this Act may be distributed to the Association of Community Organizations for Reform Now (ACORN) or its subsidiaries."
c. Division E, Military, Construction and Veterans Affairs, Title V, Sec. 511: "Sec. 511: None ofthe funds made available in this division or any other division in this Act may be distributed to the Association of Community Organizations for Reform Now (ACORN) or its subsidiaries.
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 4 of 36
8. The history, Congressional intent and particularized context of the aforementioned legislation reveals a malicious and punitive intent against, and a singling out of the Plaintiffs that arises from the heavily funded and orchestrated political campaign against the Plaintiffs, referenced below. As such, this legislation constitutes a bill of attainder, forbidden and prohibited by Article I, Section 9 of the Constitution of the United States and therefore in violation thereof.
9. The nonpartisan Congressional Research Service, an agency within the Library of Congress, warned Congress in a written report on September 22, 2009 titled "The Proposed 'Defund ACORN Act': is it a 'Bill ofAttainder'" (CRS RepOlt 7-5700 authored by Kenneth R. Thomas) that singling out ACORN, as it has since been in Sec. 163, may well constitute an unconstitutional bill of attainder.
10. Notwithstanding the concerns of the Congressional Research Service, as well as similar warnings by other members of Congress, the majority of Congress went forward and enacted Sec. 163 anyway.
II. Notwithstanding the express ruling of this Court on December 11,2009 that the singling out of ACORN make it unmistakable that Congress determined ACORN's guilt before defunding it, Congress has now transformed the purportedly short-term temporary act into a long-term one -- at least for the entire fiscal year of2010 -- by using essentially identical language in its legislative defunding of ACORN in Sections 427 (Department of Interior), 418 (Departments of Transportation and HUD), 534 (Departments of Commerce, Justice and Science) and 511 (Departments of Military and Veterans Affairs).
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 5 of 36
12. Currently the Code of Federal Regulations contains extensive regulations that provide for a comprehensive regulatory scheme to address federal contractors or grantees who are accused of fraud or misconduct.
13. Nonetheless, in Section 163 of the Continuing Resolution, Section 427, and Sections 418, 534 and 511 of the omnibus budget, Congress has specifically bypassed the regulations found in the Code of Federal Regulations, referenced above, and instead peremptorily singled out ACORN and the Plaintiffs herein. In so doing neither Congress nor defendants have provided any notice or hearing before or after the deprivation wrought as a direct result of Section 163, Section 427, and Sections 418, 534 and 511.
14. In addition to the fact that this legislation constitutes a bill of attainder, it also violate the Plaintiffs' rights, secured by the First Amendment of the United States Constitution, as well as the Plaintiffs' rights to due process, as secured by the Fifth Amendment of the United States Constitution. JURISDICTION AND VENUE
15. This court has jurisdiction pursuant to 28 USC, Section 1331 (federal question jurisdiction) and 28 USC, Section 220 1(Declaratory Judgment Act).
16. Article I, Section 9 of the Constitution specifically forbids Congress from passing a bill of attainder.
17. This action is brought directly under Article I, Section 9 and the First and Fifth Amendments to the Constitution of the United States.
18. Venue is proper in this court pursuant to 28 USC, section 1391(a)(2) and 28 USC, Section 1391 (e)(2) due to the fact that many of the actions, transactions, misconduct by Defendants have taken place in the Eastern U.S. District of New York. Further, one of
5

Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 6 of 36
the Plaintiffs' principal places of business is in Brooklyn, New York, in the Eastern District.
PARTIES Plaintiffs 19. Plaintiff Association of Community Organizations for Reform Now, commonly known as
"ACORN," (hereafter "ACORN") is a non-profit Arkansas corporation which exists for the purpose of organizing low- and moderate-income people to achieve social and economic justice. It has 500,000 members located in 75 cities across the United States. ACORN's national offices are located at 2 Nevins Street, Brooklyn, New York. It also has offices in Washington, D.C. and New Orleans, Louisiana. 20. Since the continuing resolution, Sec. 163, was originally passed by Congress, ACORN has experienced, and continues to experience, the following: a. ACORN has had to layoff employees; b. ACORN has closed offices and drastically reduced services to low and moderate
income people across the United States; c. ACORN programs have been slashed. For example, in September 2009, the New
York first time homebuyer education classes enrolled 100 first time homebuyers. In October, due to budget and staff cutbacks, it enrolled 7 people. d. ACORN has been penalized by Congress without an investigation. ACORN was never even the subject of a hearing in Congress. ACORN has not given any notice that the organization had to do anything or take any action before funds would be terminated. ACORN funds were just cutoff by Congress.
6

Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 7 of 36
e, Many organizations partnering with ACORN cut off relationships with ACORN for fear of being tainted by association with ACORN. ACORN has been advised that other organizations are concerned about the federal cutofflanguage which prohibits funds to "ACORN or any of its affiliates, subsidiaries or allied organizations" being interpreted to include non affiliated organizations which are independent but work with ACORN even though no federal funds are distributed to ACORN through the relationship.
21. Plaintiff ACORN Institute, Inc. (hereafter "AI") is a not-for-profit corporation, incorporated in Louisiana, certified by the Internal Revenue Service as tax-exempt under Section 501(c)(3) of the Internal Revenue Code. a. AI works on civil rights, employment, housing, and social service issues in lowincome communities. b. AI has a separate corporate existence from ACORN, with a separate board of directors and separate management. There is no overlap between the governing board of directors of AI and ACORN except that one of the members of AI's Board is also an alternate national director of ACORN' board. Only AI's board has the power to hire and fire its Executive Director. c. In practice, the AI and ACORN collaborate closely and AI gets many grants which it contracts with ACORN to carry out. For example, in conjunction with ACORN, AI operates a countrywide network of "ACORN" Centers which provide free tax preparation, benefits enrollment, and foreclosure prevention services.
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 8 of 36
d. Among the grants it has received are Resident Opportunities and Supportive Service ("ROSS") grants administered by the U.S. Department of Housing and Urban Development ("HUD")
e. Under these grants, AI, through ACORN, performs outreach and education activities in public housing projects, including financial literacy training.
f. Through this training, public housing residents learn how to build good credit, avoid predatory lenders, and develop immediate and long-term money management skills.
g. AI has also received grants under the HUD Fair Housing Initiative Program. h. AI's offices are located at 2609 Canal Street, New Orleans, Louisiana. i. No grant which AI has received and administrated has ever been alleged to have
been involved in any misconduct or illegal conduct. AI has never been indicted of any crime, nor has any AI employee ever been indicted of a crime in conjunction with any work they have done for AI. AI has never been denied any grant from any federal agency due to alleged misconduct. J. As a result of the actions of the Defendants herein, taken pursuant to Section 163 and adverse to the Plaintiffs herein, extensive funding for AI's activities, numerous contracts and contract opportunities have all been cancelled or withdrawn (see below for specific examples). k. Further, as a result of the actions of the Defendants herein, adverse to the Plaintiffs herein, the cut off of all federal funds pursuant to Section 163 has decimated AI. As of September 2009 AI employed 20 employees. As of today, a
8

Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 9 of 36
little over a month later, AI has two or three employees. It has been forced to layoff close to 85% of its employees. 22. Plaintiff NEW YORK ACORN HOUSING CO., INC. (hereafter "HOUSING) is organized as a not-for-profit corporation in New York, and has tax-exempt status under Section SOI(c) of the Internal Revenue Code. It does the following: a. NYAHC owns, develops and manages housing affordable to low income
families. It controls or manages over 140 buildings with over 1200 apartments in all boroughs of New York except Staten Island. b. At no time has NYHAC ever been accused, let alone convicted of any crime. Nor has any employee or agent of NYHAC ever charged or convicted of a crime while acting within the scope of their employment; c. As a result of the suspension of funding to ACORN and ACORN affiliates resulting from the passage of Continuing Appropriations Resolution, 2010, Division B of Public Law No. 111-68 (Section 163) NYAHC has been forced to suspend all new intakes of first time home buyers and mortgage foreclosure cases due to: Suspension or withdrawal of funding for the ACORN Housing Corporation First Time Homebuyer Education Program and the Housing Mortgage Foreclosure Counseling (HMFC) Program; and Suspension or withdrawal of funding and programs from partner banks (Citibank, Chase, Bank of America) that had provided mortgage and financing assistance for ACORN Housing Corporation clients. d. The CR has also caused the banks with which we have consistently worked (list, etc and describe the work) to, in turn, suspend their funding of our
9

Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 10 of 36
programs, as set forth below. The reason that these banks have given for suspending these programs is that ACORN Housing Corporation has no "pipeline" of new clients in need of mortgage and financial assistance due to the reduction in ACORN operations brought about as a result of the budget suspension (Section 163) of federal funds. e. Since NYARC' s operations have been suspended it no longer has the names of, or relationship with people whom it represents, in need of mortgages or financing assistance. It therefore no longer has a "pipeline" and cannot seek participation from the aforementioned banks. f. In addition, these banks have stated that they fear being prevented from participating in programs financed, in whole and in part, by the federal government. They state hat these fears are derived from the Federal ban on any entity that is "affiliated" with or "allied" to ACORN, such as NYAHC. Therefore they tell us, they have discontinued any relationship, including funding and joint programs, with NYAHC. g. Furthermore, grants that NYHAC has in the past received from the Center for New York City - over the past two years, totaling approximately $340,000 have been suspended. This sum is comprised of close to $250,000 to pay for loan counselors and $90,000 for outreach. As a consequence, NYHAC will, in the very near future, be forced to take the following steps, adverse to our program and mission: NYARC supervised staff will have to be laid off; The over 2,000 families that NYAHC counsels will now have the following problems and issues: They will be at risk for predatory and subprime lending
10

Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 11 of 36
scams; They will not have the benefit of NYAHC's default counseling program and will be more susceptible to the risk of foreclosure. (Ironically, this will especially adversely effect those referenced in Paragraph IO(b)(i) above, who have fallen prey to unethical lending scams due to the discontinuation ofNYAHC funding.) They will receive no counseling to prepare them for homeownership; They will not have the opportunity to obtain special products that will assist them to become new home buyers including PM! (Private Mortgage Insurance); lower interest rates; grants to assist with down; h. NYAHC's current counseling pipeline, which now has over 1,500 cases will have to be shut off and those families will be forced into a Catch 22 - either negotiate directly with the banks for a modification or go to the costly and ineffective private sector (or just lose their homes). 1. Over the past ten years, NYAHC has purchased 3 separate housing developments from HUD and, as a result, saved 345 apartments and residents from eviction, relocation and/or escalating rents. Two ofthese three developments have Housing Assistance Program (HAP) contracts for project based Section 8 to help very low income families pay the rent. As a result of the aforementioned funding suspensions and threatened funding suspensions, above referenced, the ability ofNYAHC to maintain these developments, is gravely endangered. Almost all of these buildings (close to 150) have some HOME (federal funds that are passed through the city/municipality) mortgages - 0% or 1% mortgages. These mortgages allow NYAHC to
11

Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 12 of 36
develop housing that is affordable to very low income families, and allow NYAHC to keep this housing affordable indefinitely. We have buildings in our pipeline, that were developed and rehabilitated as far back as 1989 and that are now endangered, in that they may no longer be a part of this program. J. NYAHC had been awarded a grant from the Division of Housing and Community Renewal of the State ofNew York (DHCR), for another significant foreclosure prevention project. Much of this grant was for outreach. This outreach project consisted of phone calling, door knocking and other forms of outreach to identify homeowners in default or at risk of foreclosure .This funding has currently been suspended. k. The New York State Housing Finance Agency (HFA) - had/has also subcontracted with NYAHC to do work designed to prevent foreclosures. This has allowed NYAHC to pay additional staff to do the necessary counseling. These funds have now been suspended due to the federal funding suspension of the activities of ACORN and ACORN affiliates. As a result the foreclosure work previously done on behalf of numerous families·has been indefinitely discontinued.
Defendants 23. The UNITED STATES OF AMERICA is made a defendant in that the actions and
inactions complained of herein are the result of unconstitutional actions of members of Congress in passing an unlawful bill of attainder.
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 13 of 36
24. Defendant SHAUN DONOVAN is the Secretary of Housing and Urban Development. As such he is sued in his official capacity.
25. Defendant PETER ORSZAG is the Director of Office of Management and Budget of the United States. As such, he is sued in his official capacity.
26. Defendant TIMOTHY GEITHNER is Secretary of the Treasury of the United States, he is sued in his official capacity.
STATEMENT OF FACTS 27. Since 2003, ACORN has helped over two million people register to vote. It has
advocated raising the minimum wage to a living wage in dozens of communities across the country. It works against predatory lending and to stop foreclosures. It has helped over 150,000 people file their tax returns. It has worked on thousands of issues that arise from the predicaments and problems of the poor, the homeless, the underpaid, the hungry and the sick, on the local, state and national level through direct action, negotiation, legislative advocacy and voter participation. 28. As with all large organizations, undoubtedly some agents, members and employees of ACORN have, over time, made mistakes, most of which have victimized ACORN itself and not the public. 29. ACORN has responded to these mistakes by terminating staff who engaged in misconduct, has re-organized its board of directors, reorganized its national staff, hired new counsel, and even hired the former Attorney General of the state of Massachusetts to conduct an internal investigation. ACORN has continually responded to legitimate criticism by putting its financial and administrative house in order.
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 14 of 36
30. The two million people ACORN registered to vote since 2003 have largely resided in minority communities. Without the work ofthe Plaintiff, ACORN, these people would be otherwise disenfranchised and would not have voted in the last presidential election.
31. Precisely because these previously disenfranchised voters participated in recent elections, ACORN earned the animosity of political forces who are dedicated to the proposition that the fewer poor people who vote the better.
32. Section 163 was passed in large part due to a public relations campaign orchestrated by political forces that have persistently attacked and defamed the Plaintiff ACORN, its members, affiliates and allies (other Plaintiffs herein), motivated by their hostility toward the Plaintiffs' tireless commitment to registering voters, particularly those poor and working Americans who have been consistently disenfranchised and excluded from the American political system.
33. On September 9, 2008, these same political forces released edited hidden-camera videos in which the videographers posed as a prostitute and her boyfriend in order to elicit responses from ACORN employees (and employees of separate corporations) in several cities regarding home loans, taxes and, what they described as underage sex workers trafficked from outside the u.S.
34. ACORN immediately responded to the videos by launching an internal investigation conducted by the former Attorney General of Massachusetts; and it fired the employees who were featured in the videos. Indeed, on December 7, 2009, former Attorney General Harshbarger released the final report of his investigation, which includes, among others, the following conclusion regarding the hidden-camera videos which were reviewed in their entirety:
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 15 of 36
a. "[I]n fact, there is no evidence that action, illegal or otherwise, was taken by any ACORN employee on behalf of the videographers." (Harshbarger Memo, Appendix D, attached hereto as Ex. G)
35. Certain members of Congress, immediately after the public release of selected excerpts from the video, undertook a program to punish Plaintiff ACORN, other unnamed "affiliated and allied organizations," and the other Plaintiffs in this action.
36. Despite numerous press reports and congressional, independent, and other governmental investigations of many other scandals involving serious misconduct such as fraud or corruption among government contractors, some of which involved corporations which were convicted of serious crimes, Congress has thus far enacted no laws singling out for suspension or debarment any government contractor, other than the Plaintiffs, herein and their affiliates and allies.
37. Indeed, in the past few years, Congress has specifically refused to enact proposed legislation that would generally bar from federal contracts and funding, corporations with criminal convictions or pending indictments.
38. This punitive intent against ACORN is evident from the legislative context which led to the passage of Section 163, Section 427 and Sections 418, 534 and 511, set forth, by way of example, as recited, in part, below: a. On September 14, 2009, in proposing ACORN defunding legislation passed by the Senate, Senator Mike Johanns (R-NE) said: "Somebody has to go after ACORN. Well, I suggest today, on the floor ofthe Senate, that ' somebody' is each and every U.S. Senator." b. Senator Johanns requested that the Executive Summary of a Minority report of one House committee, which was never even adopted by the committee, the deeply
15

Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 16 of 36
flawed report entitled "Is ACORN Intentionally Structured as a Criminal Enterprise? " be made a part ofthe Congressional Record. This report was authored by the minority staff of a committee for Rep. Darrell Issa, who has been attacking ACORN for years. c. This 88-page report was prepared for Representative Darrell Issa on behalf of the minority members of one House committee. The "Issa Report", though never adopted or approved by any House committee, much less the House itself, has played a major and influential role during the Congressional debate surrounding and regarding the passage of the "Defund Acorn Act" and Section 163, referenced above, d. That Report states that "ACORN has committed a conspiracy to defraud the United States." e. The report contains the following bullet points, among others: i. "ACORN launders federal money in order to pursue a partisan political
agenda and to manipulate the American electorate." 11. "Under the Obama administration, ACORN stands to $8.5 billion in available
stimulus funds . iii. ACORN is a "shell game." IV. Somebody has to "go after" ACORN. v. ACORN is guilty of a conspiracy to "defraud" the United States f. Also on September 14, 2009, in the House of Representatives, Representative Dan Burton (R-IN), in an obvious effort to implicate President Obama, said that "[i]t's really interesting to find out that ACORN, which helped the President get elected,
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was such a strong force for him and whom he congratulated on the support they gave him ... So he's so very close to ACORN." g. On September 16,2009, the day before the House passed the "Defund ACORN Act," Representatives Steve King (R-IA) and Todd Akin (R-MO) accused ACORN of using millions of taxpayer dolIars "to advertise for a political candidate" based on the fact that there was a poster of President Obama poster hanging in ACORN headquarters and calIed it "a Jeremiah Wright moment." h. On September 17, 2009, after proposing the Defund ACORN Act in the House on September 17,2009, Representative DarrelI Issa (R-CA) says the purpose ofthe legislation was "to put an immediate stop to Federal funding to this crooked bunch" and to "enact a comprehensive ban on Federal funding for this corrupt and criminal organization." 39. The charges leveled against ACORN by members of Congress such as that it is a "criminal enterprise", or a "corrupt and criminal organization", or a "crooked bunch" are false. 40. On October 1,2009, Public Law 111-68 was approved. Included in that law was Division B- Continuing Appropriations Resolution, 2010. In that resolution, the Section applied to ACORN is Section 163. It reads:
"Sec.163. None ofthe funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now (ACORN), or any of its affiliates, subsidiaries, or alIied organizations." 41. The aforementioned Continuing Resolution, including Section 163 was amended to remain in force until December 18,2009 pursuant to a law known as Further Continuing
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Appropriations Resolution, 2010, H.R. 2996, I I lib Congo(2009) (enacted), Division B of Pub. L. No. 11 I -88. The prohibition contained in Section 163 therefore continues in effect until December 18, 2009. Therefore, for purposes of clarity, within this Complaint, this legislation will continue to be designated as "Section 163." 42. On October 29, 2009, at the same time that it extended Section 163 of the Continuing Resolution until December 18, 2009, Congress also passed Section 427 ofthe Department of the Interior, Environment, and Related Agencies Appropriations Act of 2010, in effect for the full fiscal year of2010, ("Section 427"), Division A of Pub. L. No. 111-88, which was signed into law by President Obama on October 30, 2009. 43. On December 13, 2009, two days after this Court declared Section 163 to be an unconstitutional bill of attainder, Congress passed Sections 418 (Departments of Transportation and HUD), 534 (Departments of Commerce, Justice and Science) and 511 (Departments of Military and Veterans Affairs), of the full Consolidated Appropriations Act of2010, H.R. 3288 ("Sections 418,534 and 511"), all in effect for the full fiscal year of2010. On December 16,2009, President Obama signed this bill into law. 44. Dozens of members of the U.S. House of Representatives and of the U.S. Senatelegislators have who refused to even authorize an investigation into federally funded organizations and corporations whose employees are charged with murder or to vote for a bill which would root out fraud in defense contracts where major corporations have been found to have committed upwards of 18 acts of misconduct -- have unconstitutionally voted to summarily strip ACORN and all of its affiliates, subsidiaries, and "allied organizations" of all federal funds, thereby essentially eviscerating this critical advocate for poor and working peoples' rights.
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45. In response to Section 163 and the actions of Congress, Defendant ORSZAG, acting in his official and in concert with the other Defendants herein, has enfoEced the unconstitutional Section 163 dw-ing its implementation and will continue to do so by ordering that federal executive departments and agencies do the following: a. that they may not obligate or award any Federal funds dw-ing futw-e periods to ACORN, or any of its affiliates, subsidiaries or allied organizations dw-ing the period of the implementation of Section 163; b. that the prohibitions of Section 163 to apply not only to the funding that is made available by the Continuing Resolution, but also to the funding that was made available by previously enacted statutes; c. therefore, to the extent that any such agency or executive department has already determined that there is an obligation to fund ACORN or its affiliates but has not yet entered into any agreement to provide such funds to ACORN or any of its affiliates, that agency may not provide such funds, or enter into any such agreements to do so; d. that grant and contractual payments for work already done, and that performance of all obligations, including payment of federal funds, be immediately suspended; e. Because Section 163 broadly requires that no funds may be "provided," departments and agencies are to assw-e and take steps so that no federal funds awarded to other entities are awarded or obligated by such grantees or contractors to ACORN or its affiliates, as subgrantees, subcontractors, or other subrecipients;
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f. that the departments and agencies are to notify all Federal grant and contract recipients of the prohibition contained in Section 163, and provide them with a copy of the guidance document prepared by Defendant ORSZAG, which details the sanctions and prohibitions, set forth in this paragraph;
g. that the departments and agencies must advise all, Federal grant and contract recipients:
h. not to provide Federal funds to ACORN or its affiliates as subgrantees, subcontractors or other subrecipients, consistent with the guidance document prepared by Defendant ORSZAG, which details the sanctions and prohibitions, set forth in this paragraph; and
.i. to notifY them (the Agency or Department) of any existing subgrants, subcontracts or other subrecipient agreements with ACORN or its affiliates; and
J. that the departments and agencies require their grantee or contractor to advise them as to how that grantee or contractor is planning to comply with the prohibitions of Section 163 with respect to those subgrants, subcontracts or sUbrecipient agreements.
46. As a result of the passage of Sections 163,427,418,534 and 511, and the actions of the Defendants in enforcing them, as set forth above, the Plaintiffs have suffered and will continue to suffer the loss of income, contracts and contract opportunities, specifically: a. Plaintiffs' applications for contracts with federal agencies have been and will continue to be summarily rejected. For example: An application with the Environmental Protection Agency for a three year $780,000 grant for outreach to poor communities, to raise
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awareness of and educate about the lung disease asthma was rejected. UCLA was to be the project coordinator and the work would have been done by ACORN staff. ii An application to set up public computer centers in five different cities to train poor people on basic computer skills was rejected. b. One of the Plaintiffs, AI, had a grant with FEMA to conduct home fire safety assessments in private homes to determine whether the homes were protected, and if not, provide free of charge, to poor people living in those homes, various devices to ensure that their houses would be safe. The same work had been done by plaintiffs during the past year and FEMA had awarded slightly less than $1,000,000 for past and ongoing work in the future, including the current period, and beyond. AI was informed on September 25, 2009 that it had been awarded that grant. In early October 2009, before AI had a chance to draw down on the funds, it was informed by FEMA that it had suspended the contract and that AI would not be permitted to start the work previously agreed upon. Because of this suspension, AI had to layoff six employees who were engaged in the home fire safety assessments.
c. Plaintiffs, including AI, had various existing contracts and agreements with HUD which have been suspended and/or terminated as a result of the CR and Defendant Orszag's OMB memo. Those grants and OMB circular A-I 10 that they reference provide for agency termination or suspension only for justifiable cause, such as if the grantee materially fails to comply with the terms or conditions of the award. For example, plaintiffs had agreements with HUD under which they conduct tax preparation and leadership development classes for public housing
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residents to obtain GED degrees. Plaintiffs had been operating these programs to

the satisfaction of HUD, with no complaints or allegations of misconduct

concerning Plaintiffs' work on these contracts. Nonetheless, in violation fo

plaintiffs rights under their contractual agreements and under the applicable

regulations, HUD immediately terminated and lor suspended these contracts in

early October pursuant to the CR and Defendant Orszag's memo.

d.

AI obtained reimbursement on these contracts by first doing the work and

then drawing down the funds in the grant by accessing an automated system and

putting in its password which allows it to obtain funds to pay workers who have

done the work. As of the beginning of October, 2009, $8 - 9,000 was owed

Plaintiffs for work done on these contracts. At that time, reimbursement was

terminated. As a result, Plaintiffs have been forced to cancel GED classes in the

middle of the class and is unable to do any of the work for these public housing

residents.

e. In several cases, Plaintiffs had applied for grants as subcontractors with groups

that already had federal funding. Plaintiffs had been informed by those groups that

they, the Plaintiffs would likely receive the grant upon the signing of the contract.

However, due to Section 163, Plaintiffs were informed in early October that they

would not be permitted to sign such contracts or enter into such subcontracts. For

example:

1. One of these grants was for a United States Department of Agriculture

grant to do work in the state of Washington so as to outreach to poor

people to inform them of their eligibility for food stamps and

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supplemental nutrition assistance. For that program, the contractor ("Reach") subcontracted with Plaintiff AI to do approximately $90,000 worth of work. Plaintiff AI had been subcontracted to do this work during the past year and had done the work to the satisfaction of the contractor and the government agency in question. Thus the contractor had decided to continue to subcontract with the Plaintiff to continue this work for the coming year. Before the Plaintiff could sign the continuation contract for 2009, however, in early October, they were informed that the agreement to have AI do the work had to be cancelled because of Section 163 and the consequent ac. As a result, Plaintiff had to layoff the employees who would have carried out this work. ii. Plaintiffs had an agreement with a contractor in California, for about $150,000, to do work on the same type of program, as referenced in Paragraph 41 (e)(i) above. Again, the contractor and the agency were satisfied with the Plaintiffs' performance and were poised to sign a new contract. However, due to Section 163 and the actions ofthe Defendants, Plaintiffs were not allowed to continue the project for the following year, 2009. 47. As set forth above, the executive branch of the federal government is legally obligated, authorized and mandated to ensure the integrity of federal programs by conducting business with responsible parties. The law provides a variety of methods and mechanisms for so doing, to wit:
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a. Government contractors can be debarred or suspended under federal statutes or under the Federal Acquisition Regulation, an administrative rule which governs contracting by executive agencies.
b. Federal agencies maintain oversight over the competitive federal grant process and maintain full oversight for each disbursement of federal grant funds.
c. There is a competitive grant process in place with a framework both of governmentwide and agency specific regulations by which the government can exclude contractors from receiving federal funding.
d. The Code of Federal Regulations (CFR) provides the Office of Management and Budget (OMB) extensive regulation and guidance for federal agencies regarding government-wide debarment and suspension of eligibility for government grants.
e. Under the CFR guidelines, an agency may impose suspension or debarment based on a variety of bases including when it determines that there has been an indictment, conviction, civil judgment, or official finding by federal, state, or local bodies that determine factual andlor legal matters, and irnmediate action is necessary to protect the public interest.
f. The regulatory process includes notice, adequate investigation, and an opportunity to contest, and may result in suspension or debarment for a specified period of time or until there is compliance with the specific finding.
48. The actions that led up to and included the passage of Section 163, Section 427 and Sections 419, 534 and 511 as referenced above, all share the following characteristics: a. they are devoid of impartiality and lack general applicability;
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b. they have targeted and singled out the Plaintiffs, and are therefore do not partake of generality in application and impact - indeed they are specifically tailored and designed to effect and/or punish the Plaintiffs and only the Plaintiffs, in that they specify the group and/or groups of people upon whom the prescribed sanction is to be levied;
c. they are inconsistent with the Federal Regulations set forth above and with the remedial intent and framework that those regulations are premised upon;
d. they are propelled by and enacted as a result of punitive intent; e. they are infused with punitive impact and effect; and f. they arrogate the task of adjudication to Congress rather than leaving it, as it must
be left, to other tribunals.
CLAIMS COUNT I Article I, § 9, CI. 3 Bill of Attainder 49. Plaintiff incorporates by reference the allegations set forth in Paragraphs 1 through 47 as if fully set forth herein. 50. Article I, Section 9, cl. 3 of the Constitution of the United States is one of the crown jewels of the founding instrument of our nation. It explicitly provides that "No bill of attainder or ex post facto law shall be passed." 51. While its concerns are addressed more generally, in spirit, by other provisions of the Constitution, such as the due process clause of the Fifth Amendment (see below), the prohibition against bills of attainder was specifically incorporated before the Bill of Rights was drafted due to the founders' very concrete concerns and fears of the
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possibility of legislative tyranny, which they had personally experienced while still British colonists. 52. The prohibition against bills of attainder contained in clause, Art. I, §9, cl. 3, along with its companion prohibition against ex post facto laws, was enacted to ensure that Congress not single out individuals or groups and declare them guilty, nor inflict punishment after trial by legislature. Rather the Constitution sought to secure some degree of certainty, uniformity and fairness in our government and in our governmental process. 53. As noted above, there are already significant existing regulations which set forth careful guidelines for determining whether, and how, specified federally-funded entities can be excluded from various government programs. 54. By enacting Section 163, Section 427 and Sections 418,534 and 511, Congress has adjudged ACORN guilty of the allegations of fraud, misconduct and other illegal conduct.. By extending its funding ban not only to ACORN but to all "affiliated" and "allied" organizations, Congress has adjudged those organizations guilty as well. 55. Further, Section 163, Section 427 and Sections 418, 534 and 511's total bar to funding allows no mechanism for the Plaintiffs to demonstrate that they have cured or corrected any alleged wrongdoing. 56. Congress, in enacting Section 163, Section 427 and Sections 418, 534 and 511, bypassed the regulations and acted in a manner inconsistent with those regulations. The legislation and the system which it puts in place, lack the following:
a. consistency with fed regulations; b. any semblance of due process;
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 27 of 36
c. any regard, appreciation or understanding that separate groups and organizations have separate identities, interests, structures and characteristics;
d. any discretion to give the any of the affected organizations, including the Plaintiff organizations herein, an opportunity to correct or cure any alleged misconduct or wrongdoing;
e. a mechanism, appeal or ability to reevaluate this determination of debarment and suspension.
57. The system, described above, contradicts the system of agency due process also set forth above and is in direct conflict with that system.
58. Given this disregard, contradiction and conflict, the only conclusion that can reasonably be drawn, within both the legislative context and the ignored regulatory context, is that the functional purpose of Section 163, Section 427 and Sections 418, 534 and 511 is to punish ACORN and the other Plaintiffs herein.
59. Thus the punitive nature of this legislation indelibly taints it as an unconstitutional and unlawful bill of attainder. The punitive nature of the legislation can also be seen in the legislative process that led to its adoption outlined above.
60. As a proximate result of the enactment of this bill of attainder, Section 163, Section 427 and Sections 418,534 and 511, and the actions of the Defendants pursuant thereto and complained of herein, all in violation of Article J, Section 9, cl. 3 of the U.S. Constitution, Plaintiffs herein are imminently and irreparably harmed, including but not limited to the following: a. Extensive funding of Plaintiffs' activities has been cut off;
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b. numerous contracts and contract opportunities have all been cancelled or withdrawn;
c. Plaintiffs' pending applications for federal grants are nullified and will not be reviewed;
d. Plaintiffs' ability to even prepare or file an application with any agency or department ofthe federal government has been impaired;
e. Similarly, past, present and future relationships with companies, corporations and other groups, which enter into contracts with agencies of the federal government, have been terminated, disrupted, eliminated and impaired;
f. Other groups, organizations or corporations such as banks and foundations that plaintiffs have dealt with in the past have suspended or terminated their ties with plaintiffs for fear of being tainted by their association with plaintiffs;
g. The Plaintiffs have been forced to discontinue some operations and activities,; and
h. Plaintiffs have been forced to cut payroll, laying off some of their employees.
COUNT II: First Amendment Freedom of Speech and Association 61. Plaintiff incorporates by reference the allegations set forth in Paragraphs 1 through 59 as
if fully set forth herein. 62. Nowhere in the legislation in question is there any definition, whatsoever, for any of the
relationships set forth in the statutes, specifically: "affiliates," "subsidiaries" and "allied organizations."
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63. Plaintiffs associate with each other and with other groups or organizations for expressive purposes of furthering their civil rights and social justice goals.
64. As such the legislation adversely affects the well being, operations and activities indeed, the very survival -- of the Plaintiffs which are not ACORN in this action. In this respect, Section 163, Section 427 and Sections 418, 534 and 511 suffer from a variety of constitutional infirmities, including but not limited to: a. Overbreadth - This legislation is facially overbroad in that it is does not limit its aim at evils that the government is constitutionally allowed to address but rather sweeps within its ambit a broad array of activities that constitute an exercise of protected expressive and associational activities; and b. Vagueness - This legislation, due to its indefiniteness (i.e. lack of definition) and its uncertainty, provides no way for these Plaintiffs, or any person of cornmon intelligence, to calculate which of their activities may subject them to debarment from the federally funded programs governed by Sec. 163, Section 427 and Sections 418,534 and 511 , thus causing the following unconstitutional conditions: 1. Affected organizations which are not ACORN, ("affiliates, subsidiaries and allied organizations") must necessarily guess as to its meaning and differ as to its application; and 11. It is so vague they cannot determine whether, when and under what circumstances their actions may render them "affiliates," "subsidiaries" or "allied organizations" with ACORN.
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65. As a result, these terms prevent political, social, economic, or community based actions or positions that may be viewed as affiliation or alliance with ACORN, whether on a specific or particular issue or position or more generally.
66. Therefore, Sec. 163, Section 427 and Sections 418,534 and 511, will undoubtedly and substantially deter and chill the non-ACORN Plaintiffs herein from any activity that is likely to associate them, in any way with ACORN.
67. As such they are designed to chill the non-ACORN Plaintiffs' rights with regard to political, social economic speech, expression and association, including on national local, regional and community concerns.
68. In addition to their design, Sec. 163, Section 427 and Sections 418, 534 and 511, have the clear and objective effect of chilling the non-ACORN Plaintiffs' rights with regard to political, social and economic speech, expression and association, including on national local, regional and community concerns.
69. They also chill the actions of Plaintiff ACORN in that, since its positions, statements and campaigns may cause it to align, affiliate and associate with other groups, it can no longer do so because those groups are no longer able or willing to so align, associate or affiliate with ACORN, thereby rendering it less capable of expressing itself with regard to political, social economic speech, expression and association, including on national local, regional and community concerns.
70. Sec. 163, Section 427 and Sections 418, 534 and 511 also punish the Plaintiff ACORN in that, since its positions, statements and campaigns may cause it to align, affiliate and associate with other groups, it can no longer do so because those groups are no longer able or willing to so align, associate or affiliate with ACORN, thereby rendering it less
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 31 of 36
capable of expression with regard to political, social economic speech, expression and association, including on national local, regional and community concems. 71. The actions described herein, leading to and including the enactment of Sec. 163, Section 427 and Sections 418,534 and 51 I, as well as the past and future actions of the Defendants in carrying out the requirements, mandates and their responsibilities pursuant to and under Sec. 163, Section 427 and Sections 418, 534 and 511, constitute a violation of the Plaintiffs' rights to freedom of speech and association as secured by the First Amendment of the United States constitution. 72. As a proximate result of the enactment of this legislation in violation of First Amendment of the Constitution of the United States, Plaintiffs herein are imminently and irreparably harmed, including but not limited to the following:
a. extensive funding of Plaintiffs' activities has been cut off; b. numerous contracts and contract opportunities have all been cancelled or
withdrawn; c. Plaintiffs' pending applications for federal grants are nullified and will not be
reviewed; d. Plaintiffs' ability to even prepare or file an application with any agency or
department of the federal government has been impaired; e. Similarly, past, present and future relationships with companies, corporations
and other groups, which enter into contracts with agencies of the federal government, have been terminated, disrupted, eliminated and impaired; f. The Plaintiffs have been forced to discontinue some operations and activities; and
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Case 1:09-cv-04888-NG -LB Document 14 Filed 12/17/09 Page 32 of 36
g. Plaintiffs have been forced to cut payroll by laying off some of their employees. COUNT III: Fifth Amendment Due process
73. Plaintiffs incorporate by reference the allegations set forth in Paragraphs 1 through 71 as if fully set forth herein.
74. For reasons specifically set forth above and specifically in Paragraph 63, all re-alleged herein, Sec. 163, Section 427 and Sections 418,534 and 511, is overly broad and vague. Thus, the actions, past and future, of the Defendants in enforcing this legislation, are in furtherance of the overbreadth and vagueness that are inherent in Section 163, Section 427 and Sections 418, 534 and 511.
75. Further, as already alleged, there are already pertinent and substantive existing regulations which set forth careful guidelines for determining whether, and how, specified federally-funded entities can be excluded and/or debarred from various government programs.
76. These mechanisms and regulations provide for due process in determining whether and how such entities may be excluded, debarred and/or prohibited from funding for such programs.
77. The breadth of the government-wide ban on contracting and providing grants to ACORN and its affiliates, subsidiaries and allies contained in Sec. 163, Section 427 and Sections 418,534 and 511, completely fails to provide the due process protection, required by the Constitution and provided in the aforementioned regulatory framework.
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78. As a result of these considerations, the Defendants have violated and will continue to violate the rights of the Plaintiffs secured by the due process clause of the Fifth Amendment of the United States Constitution.
79. Furthermore, Section 163, Section 427 and Sections 418,534 and 511 and the actions of the Defendants stigmatize the Plaintiffs in ways already set forth herein. Because this stigmatization and as set forth herein, the Plaintiffs have been injured and impaired in their ability to enter into and carry out contracts. As such, the actions of the Defendants in suspending or debarring plaintiffs from all government contracts or grant awards on the basis of stigmatizing allegations have deprived them of liberty protected by the Due Process Clause of the Amendment. In addition, the suspension and/or termination of the contractual agreements that plaintiffs had with HUD and other federal agencies on the basis of stigmatizing allegations deprives plaintiffs of liberty protected by the Due Process Clause of the Fifth Amendment.
80. Defendants have violated the Fifth Amendment by depriving plaintiffs of a liberty interest without according them notification of the reasons for the deprivation or any opportunity to contest the deprivation.
81. By terminating ongoing contracts and agreements with plaintiffs that could only be terminated for cause, by refusing to reimburse plaintiffs for expenditures incurred by plaintiffs in connection with work done on these contracts prior to suspension or termination, and by suspending and/or debarring plaintiffs from government contracting, defendants have deprived plaintiffs of a property right without due process of law in violation of the Fifth Amendment.
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82. As a proximate result of the enactment of this legislation and the actions of the Defendants herein, in violation of Fifth Amendment of the Constitution of the United States, Plaintiffs herein are imminently and irreparably harmed, including but not limited to the following: a. extensive funding of Plaintiffs' activities has been cut off; b. numerous contracts and contract opportunities have all been cancelled or withdrawn; c. Plaintiffs' pending applications for federal grants are nullified and will not be reviewed; d. Plaintiffs' ability to even prepare or file an application with any agency or department of the federal goverrnnent has been impaired; e. Similarly, past, present and future relationships with companies, corporations and other groups, which enter into contracts with agencies of the federal goverrnnent, have been terminated, disrupted, eliminated and impaired; f. The Plaintiffs have been forced to discontinue some operations and activities; and g. Plaintiffs have been forced to cut payroll by laying off some of their employees.
IRREPARABLE HARM
83. Plaintiffs incorporate by reference the allegations set forth in previous paragraphs as if fully set forth herein.
84. The actions by Congress violate the United States Constitution in several ways. Violations of the U.S. Constitution constitute irreparable harm to the plaintiffs.
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85. The funding cutoff, and the manner in which the legislation has been framed has chilled ACORN's ability to associate with numerous organizations and undercut the ability of ACORN, and associated organizations, to express views, arguments and opinions about issues facing the U.S. electorate.
86. Unless this court declares the actions of Defendants, past and future, unconstitutional, and orders Defendants to reinstitute federal funds with all the regulatory due process protections to which they are lawfully entitled, ACORN and the other Plaintiffs have suffered, continue to suffer and will suffer in the future irreparable harm.
PRAYER FOR RELIEF 87. WHEREFORE, plaintiffs respectfully request that the court enter judgment as follows:
a. Issuing a temporary restraining order, a preliminary and permanent injunction restraining Defendants, and all their officers, agents, servants, employees and attorneys from violating the U.S. Constitution by enforcing: Section 163 of the Continuing Resolution; Section 427 of the Department of the Interior, Environment, and Related Agencies Appropriations Act of 20 I0; or Sections 418,534, and 511 of the Consolidated Appropriations Act of2010, HR 3288;
b. Enter judgment ordering Defendants to cease their illegal conduct and reinstitute federal funds for plaintiffs;
c. Enter judgment ordering that Defendant Orszag immediately rescind the OMB memo dated October 7, 2009 and promulgate a memo instructing all federal agencies that there is no bar to the payment of federal funds to ACORN or any ACORN subsidiary, affiliated or allied organization.
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d. Issue a Temporary Restraining Order restraining defendants from approving the award of any grant or contract which plaintiffs applied for, but had their application refused or denied because of Defendant's Orszag's aforementioned memo, until plaintiffs motion for preliminary injunction is decided by the Court.
e. Declare and determine that the actions of defendants are unconstitutional, illegal and null and void;
f Award reasonable costs and attorney fees in this matter; and g. Order any other such relief as the Court considers equitable, proper and just
under the circumstances.
Date: December J7, 2009, New York, NY
Rei)fullY submitted,
JU~
Darius Charney (DCJ Center for Constitutional Rights 666 Broadway, 7th Floor New York, NY 10012 (212) 614-6475 dcharney@ccrjustice.org William Quigley Center for Constitutional Rights Legal Director 666 Broadway, 7th floor New York, NY 10012 bguigi ey@ccrjustice.org 212.614.6427 Jules Lobel (admitted in NY and this comt JL8780)
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 Case 1:09-cv-04888-NG -LB Document 9 Filed 12/11/09 Page 1 of 21

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK -----------------------------------------------------------x ACORN; ACORN INSTITUTE, INC.; and NEW YORK ACORN HOUSING COMPANY, INC.,
Plaintiffs,
-against-

OPINION AND ORDER 09-cv-4888 (NG)

UNITED STATES OF AMERICA; SHAUN DONOVAN, Secretary of the Department of Housing and Urban Development; PETER ORSZAG, Director, Office of Management and Budget; and TIMOTHY GEITHNER, Secretary of the Department of Treasury of the United States,
Defendants. -----------------------------------------------------------x GERSHON, United States District Judge:

us OI,Ns;~F~~IKL'SEODFFICE

...

' r:OIJRiE,O,N,y

DEC 1 1 2009 ...

TIME PM, _ _ __
A -M_ ---

The plaintiffs in this case, the Association of Community Organizations for Reform Now,

Inc. ("ACORN") and two of its affiliates, challenge as an unconstitutional bill of attainder a

continuing appropriations resolution enacted by Congress that bars ACORN and its affiliates,

subsidiaries, and allied organizations from receiving federal funding from the govemment, even

under its ongoing contracts with federal agencies. In doing so, the plaintiffs ask this court to

consider the constitutionality of a provision that was approved by both houses of Congress and

signed into law by the President. Such a task can be approached only with the utmost gravity;

legislative decisions enjoy a high presumption of legitimacy. This is particularly true where the

challenge is brought under a rarely-litigated provision of the Constitution, the Bill of Attainder

Clause, which has been successfully invoked only five times in the Supreme Court since the

signing of the Constitution.

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ACORN' s critics consider it responsible for fraud, tax evasion, and election violations, and members of Congress have argued that precluding ACORN from federal funding is necessary to protect taxpayer money. ACORN, by contrast, while acknowledging that it has made mistakes, characterizes itself as an organization dedicated to helping the poor, and argues that it has been the object of a partisan attack against its mission. This case does not involve resolution of these contrasting views. It concerns only the means Congress may use to effect its goals. Nor does this case depend upon whether Congress has the right to protect the public treasury from fraud, waste and abuse; it unquestionably does. The question here is only whether the Constitution allows Congress to declare that a single, named organization is barred from all federal funding in the absence of a trial. Because it does not, and because the plaintiffs have shown the likelihood of irreparable harm in the absence of an injunction, I grant the plaintiffs' motion for a preliminary injunction.
BACKGROUND On this motion for a preliminary injunction, I have considered the complaint and the various documents and declarations submitted by the parties, who have agreed that there are no disputed issues of fact that need to be decided for the purposes of the motion. ACORN describes itself as "the nation's largest community organization of low-andmoderate income families." ACORN, in addition to its own work, has affiliations with a number of other organizations, including its co-plaintiffs ACORN Institute, Inc. and New York ACORN Housing Company, Inc. ("NYAHC"). The plaintiffs have, in past years, received millions of dollars in federal funding from a variety of grants, embodied in contractual agreements with various federal agencies, including the Department of Housing and Urban Development (" HUD").
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Numerous accusations have been made against ACORN. Most prominently, ACORN came under attack after publication of hidden-camera videos in September of 2009, in which employees of an ACORN affiliate are seen to be advising a purported prostitute and her boyfriend about how to engage in various illegal activities and evade law enforcement while doing so. Other allegations include that ACORN violated tax laws governing non-profit organizations, misused taxpayer dollars, committed voter fraud, and violated federal election laws by playing an impermissibly partisan role in its voter registration campaign. ACORN alleges that it has responded by terminating staff members found to have engaged in misconduct, reorganizing its board of directors, and hiring new counsel, including a former Attorney General of Massachusetts, to conduct an internal investigation.
In the fall of2009, in the absence of2010 appropriations acts for all federal agencies and programs, Congress enacted, and President Obama signed into law, a Continuing Appropriations Resolution ("Continuing Resolution").! That Continuing Resolution included the provision at issue in this case, Section 163. Division B - Continuing Appropriations Resolution, 2010, Pub. L. No. 111-68, § 163, 123 Stat. 2023, 2053 (2009). Section 163 reads:
None of the funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now (ACORN), or any of its affiliates, subsidiaries, or allied organizations. The Continuing Resolution containing Section 163 went into effect on October 1, 2009, and was extended, on October 31, 2009, to December 18, 2009, when it is now scheduled to expire. Division B - Further Continuing Appropriations Resolution, 2010, Pub. L. No. 111-88, § 101,
A continuing resolution is "[llegislation in the form of a joint resolution enacted by Congress, when the new fiscal year is about to begin or has begun, to provide budget authority for Federal agencies and programs to continue in operation until the regular appropriations acts are enacted." United States Senate Glossary, http://www.senate.gov/reference/glossarLterm/continuing_resolution.htm (last visited Dec. 11, 2009).
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123 Stat. 2904, 2972 (2009).2 As the expiration date for the Continuing Resolution draws near, it is unknown whether there will be a need for a further extension. That will depend on whether all regular appropriations acts are passed; according to the government, only four of the expected thirteen appropriations acts had been enacted as of the date of the preliminary injunction hearing.
On October 7, 2009, Peter Orszag, the Director of the Office of Management and Budget ("OMB") and a defendant here, issued a memorandum to the heads of all executive branch agencies regarding the implementation of Section 163 ("OMB Memorandum"). The OMB Memorandum directs, inter alia, that "[n]o agency or department should obligate or award any Federal funds to ACORN or any of its affiliates, subsidiaries or allied organizations (collectively 'affiliates') during the period of the [Continuing Resolution]," even where the agencies have already determined that funds should be awarded to ACORN, but have not yet entered into binding agreements with the organization to do so. This prohibition applies not just to the 2010 fiscal year, but also to appropriations made in fiscal year 2009, and to any funds left over from prior years' appropriations. In addition, the OMB Memorandum states, agencies should, "where permissible," suspend performance and payment under existing contracts with ACORN and its affiliates, and ask for guidance on any legal considerations from the agencies' own counsel, OMB, or the Department of Justice. Finally, turning to subcontractors, the OMB Memorandum instructs agencies to "take steps so that no Federal funds are awarded or obligated by your grantees or contractors to ACORN or its affiliates" and recommends that each agency notify federal grant and contract recipients about Section 163. On November 19,2009, HUD gave
The extension of the Continuing Resolution was included in the same law as the 2010 appropriations act for the Department of the Interior, Environment, and Related Agencies. Division ADep't of the Interior, Environment and Related Agencie s Appropriations Act, 2010, Pub. L. No. 111-88, § 427, 123 Stat. 2904, 2962 (2009). That appropriations act also includes a restriction on funding for ACORN, using somewhat different language. Only Section 163 ofthe Continuing Resolution is at issue in this case.
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notice to plaintiff ACORN Institute that it was suspending several of its contracts with the organization because of Section 163.
The plaintiffs filed suit in this court on November 12,2009, arguing that Section 163 is an unconstitutional bill of attainder and that it violates their rights under both the First Amendment and the Due Process Clause. In their complaint, the plaintiffs alleged that, as a direct consequence of Section 163, agencies have refused to review their grant applications; that grants they were told they would receive have now been rescinded; that previously-awarded grants have not been renewed; and that HUD has refused to pay on its contractual obligations even for work already performed. More generally, the plaintiffs also alleged that other organizations, such as private corporations and foundations, have cut ties to them as a result of Section 163.
On November 13, 2009, I denied the plaintiffs' request for a temporary restraining order, but required the parties to brief the preliminary injunction motion on an expedited schedule, and heard argument on December 4,2009.
In opposition to the motion for a preliminary injunction, the government argues that Section 163 is not a bill of attainder because, even though it singles out ACORN, it does not do so for the purpose of punishment. The defendants rely in part on a Department of Justice Office of Legal Counsel ("OLC") memorandum, written by David J. Barron, Acting Assistant Attorney General, in response to a request for guidance from HUD as to whether Section 163 prohibits payments to ACORN to satisfy contractual obligations that arose prior to Section 163 ' s enactment. J The OLC memorandum advises HUD that "[Sjection 163 should not be read as
Although dated October 23 , 2009, the memorandum was not released to the plaintiffs or the public until late November. While the memorandum was written specifically for HUD, the government views the memorandum as binding on all agencies of government.
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directing or authorizing HUD to breach a pre-existing binding contractual obligation to make payments to ACORN or its affiliates, subsidiaries, or allied organizations where doing so would give rise to contractual liability." To read Section 163 otherwise, the memorandum notes, would "undo a binding governmental contractual promise." The memorandum explains that its construction of Section 163 not only avoids abrogating "binding governmental contractual promises," but also avoids constitutional concerns, in particular those arising from the Bill of Attainder Clause, that "may be presented by reading the statute, which applies to specific named entities, to abrogate such contracts, including even in cases where performance has already been completed but payment has not been rendered."
The plaintiffs acknowledge that HUD, pursuant to the OLC memorandum, has paid, or has agreed to pay, for work already performed under existing contracts. The plaintiffs, however, complain that the time lag between the release of the OLC memorandum and the notification of suspension prevented them from working, and therefore earning payment, under the existing contracts. They also contend that the government's suspension of existing contracts, based solely on Section 163, violates the Bill of Attainder Clause, as does denial of the opportunity to obtain future contracts, whether renewals or new contracts, for which the plaintiffs are now ineligible.
DISCUSSION A district court may enter a preliminary injunction "staying government action taken in the public interest pursuant to a statutory or regulatory scheme only when the moving party has demonstrated that [the party] will suffer irreparable injury, and [that] there is a likelihood that [the party] will succeed on the merits of [its] claim." Alleyne v. NY Educ. Dep't, 516 F.3d 96, 101 (2d Cir. 2008) (internal quotation marks omitted).
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A. Likelihood of Success on the Merits Article I, Section 9, of the Constitution provides that "No Bill of Attainder or ex post
facto Law shall be passed. ,,4 A bill of attainder is "a law that legislatively detennines guilt and inflicts punishment upon an identifiable individual without provision of the protections of a judicial trial." Nixon v. Adm'r ofGen. Servs., 433 U.S. 425, 468 (1977). Enacted as a "bulwark against tyranny" by Congress, "the Bill of Attainder Clause was intended not as a narrow, technical (and therefore soon to be outmoded) prohibition, but rather as an implementation of the separation of powers, a general safeguard against legislative exercise of the judicial function, or more simply -- trial by legislature." United Siaies v. Brown, 381 U.S. 437, 443, 442 (1965). This principle of separation of powers animates bill of attainder jurisprudence; its prohibition "reflected the Framers' belief that the Legislative Branch is not so well suited as politically independent judges and juries to the task of ruling upon the blameworthiness of, and levying appropriate punishment upon, specific persons." Id. at 445. 5
Three factors "guide a court's detennination of whether a statute directed at a named or readily identifiable party is punitive": first, " whether the challenged statute falls within the historical meaning of legislative punishment;" second, "whether the statute, viewed in tenns of the type and severity of burdens imposed, reasonably can be said to further nonpunitive legislative purposes," an inquiry sometimes referred to as the "functional test"; and third, "whether the legislative record evinces a legislative intent to punish." See Consolidated Edison Co. of N Y. , Inc. v. Palaki ("Can Ed") , 292 F.3d 338, 350 (2d Cir. 2002) (internal quotation marks and alterations omitted). A statute "need not fit all three factors to be considered a bill of

The Constitution includes two clauses prohibiting bills of attainder. Article I, Section 9,

implicated here, restricts Congress; Article I, Section 10, restricts state legislatures.

5

The Second Circuit has concluded that the Bill of Attainder Clause applies both to individuals

and to corporations. See Consolidated Edison Co. olN. Y., Inc. v. Pataki, 292 F.3d 338, 346-47 (2d Cir.

2002).

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attainder; rather, those factors are the evidence that is weighed together in resolving a bill of attainder claim." Id.
I. Historical Meaning ofLegislative Punishment As the Second Circuit has explained, "[s]ome types of legislatively imposed harm ... are considered to be punitive per se." Id. at 351. "The classic example is death, but others include "imprisonment, banishment, . . . the punitive confiscation of property, and prohibition of designated individuals or groups from participation in specified employments or vocations." Id. 6 Any consideration of the "historical" meaning of punishment in the bill of attainder context must begin with the handful of Supreme Court cases finding statutes bills of attainder. In each of the five cases in which the Supreme Court has found legislation to violate the Bill of Attainder Clause, the context of the Court's ruling was protection of political liberty.7 In Cummings v. Missouri, 71 U.S. (4 Wall .) 277 (1866), for example, the Court concluded that a statute that barred persons from certain professions unless they took an oath that they had never been connected to an organization "inimical to the government of the United States" was punishment for past association with the Confederacy. Accord Ex Parte Garland, 71 U.S. (4 Wall.) 333 (1866); Pierce v. Carskadon, 83 U.S. (16 Wall.) 234 (1872). Similarly, in United States v. Brown, 381 U.S. 437 (1965), the Court held that a statute making it a crime for a member of the Communist Party to serve as an officer or employee of a labor union was a bill of attainder. In the fifth case, United States v. Lovett, 328 U.S. 303 (1946), the Court held that a statute that permanently barred three government employees, who had been accused of being communists, from government service was an unconstitutional bill of attainder.

6

The history of the bill of attainder, and its roots in fourteenth century England, has been described

elsewhere. See, e.g., Brown, 381 U.S. at 441-49; In re Extradition ofMcMullen, 989 F.2d 603, 604-06

(2d Cir. 1993).

7

Here, plaintiffs allege that ACORN has been punished both for alleged misconduct, such as fraud,

and for its alleged impermissible partisanship.

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At first blush, the idea that the deprivation of the opportunity to apply for discretionary federal funds is "punitive" within the meaning of the attainder clause seems implausible. Neither the Supreme Court nor the Second Circuit has been faced with such a claim. One district court, however, in a case much like this one, has concluded that denial of the opportunity to apply for state government contracts amounts to punishment under Article I, Section 10. See Fla. Youth Conservation Corps. , Inc. v. Slutler, No. 06-275, 2006 WL 1835967, at *2 (N.D. Fla. June 30, 2006). For the reasons described below, I agree with the district court in Florida and conclude that the discretionary nature of governmental funding does not foreclose a finding that Congress has impermissibly singled out plaintiffs for punishment.
Lovell is particularly instructive in this regard. In Lovell, a congressman attacked thirtynine specifically named government employees, including the plaintiffs, as "irresponsible, unrepresentative, crackpot, radical bureaucrats," and affiliates of "communist front organizations." Lovett, 328 U.S. at 308-09. Following secret hearings, Congress passed an act that no appropriation could then, or later, be used to pay the plaintiffs' government salaries. Id. at 312-13.
The Supreme Court concluded that the appropriations act "clearly accomplishes the punishment of named individuals without a judicial trial." Id. at 316. That Congress placed the prohibition in an appropriations bill carried no weight. "The fact that the punishment is inflicted through the instrumentality of an Act specifically cutting off the pay of certain named individuals found guilty of disloyalty," the Court concluded, "makes it no less galling or effective than if it had been done by an Act which designated the conduct as criminal." Id.
The government attempts to distinguish this case from Lovell on the ground that the plaintiffs in that case had a "vested property interest" in their jobs, whereas here, as the plaintiffs unequivocally acknowledge, they have no right to the award of a grant or contract from the
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federal government. But the Court in Lovett did not base its decision on a property rights analysis. The Supreme Court found a deprivation amounting to punishment under the Bill of Attainder Clause, not only because the plaintiffs were deprived of their earned income on existing government jobs, but also because they were deprived of any future opportunity to serve the government. As the Court stated, "[t]his permanent proscription from any opportunity to serve the Government is punishment, and of a most severe type." Id. That the plaintiffs had no right to any particular future job was of no moment.s
The government relies on Flemming v. Nestor, 363 U.S. 603 (1960), to argue that the denial of the opportunity to apply for federal funding cannot be punishment. In Flemming, the plaintiff argued that a statute, which denied Social Security benefits to a limited category of deported aliens, was a bill of attainder. The Supreme Court disagreed, describing the deprivation as only the "mere denial of a noncontractual government benefit" and finding no punitive intent in the design of the statute. Id at 617. The government also points to Selective Service System v. Minnesota Public Interest Research Group ("Selective Service"), 468 U. S. 841, 853 (1984), where the Court upheld a statute barring persons who had not registered for the draft from federal student aid as not constituting punishment.
This case is closer to Lovett than to Flemming or Selective Service. The Supreme Court III both Flemming and Selective Service found the statutes at issue to be nonpunitive. In Flemming, the Court concluded that the legislative record "falls short of any persuasive showing that Congress was in fact concerned alone with the grounds of deportation," which, in the

8

The government argues that, unlike the provision in Lovett, the bar here is "temporary." But even

if Section 163 proves to be short-lived - a matter in doubt as, according to the government, nine

appropriations acts have yet to be enacted - its effect on ACORN may not be "temporary." Plaintiff

ACORN Institute, for example, has a pending application with the Department of Commerce and another

with the Environmental Protection Agency, both of which would last three years. Comp!., Ex. B (Griffin
Aff. mJ 8-9). A short deprivation of the opportunity to apply could therefore have long-term

ramifications.

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plaintiffs case, was prior membership in the Communist party. Flemming, 363 U.S. at 619. In Selective Service , the Court reasoned that the statute had the valid goal of encouraging a class of persons to do what they were already legally obligated to do - register for the draft. See Selective Service, 468 U.S. at 860. As discussed further below, I cannot similarly discern any valid, non-punitive purpose for Congress enacting the legislation in this case.
Also, in neither Flemming nor Selective Service did Congress single out any particular individual or entity for adverse treatment; rather, each statute applied to an entire category of people. Here, in contrast, the Congressional deprivation is imposed only on ACORN and its affiliates, and, unlike the statute in Selective Service, cannot be avoided by ACORN through any conduct on its part. See Flemming, 363 U.S. at 619 (reasoning that, even if the legislative history were read "as evidencing Congress' [s] concern with the grounds [of prior Communist party membership], rather than the fact, of deportation," "[t]his would still be a far cry from the situations involved in [prior Supreme Court cases] where the legislation was on its face aimed at particular individuals."). Cf Nixon v. Adm 'r of Gen. Services, 433 U.S. at 485 (Stevens, J. concurring) (stating that "[i]t has been held permissible for Congress to deprive Communist deportees, as a group, of their social security benefits, but it would surely be a bill of attainder for Congress to deprive a single, named individual of the same benefit. ... The very specificity would mark it as punishment, for there is rarely any valid reason for such narrow legislation[.]") (citations omitted).
2. The Functional Test I next consider whether Section 163 furthers non-punitive legislative purposes in light of the type and severity of the burdens the statute imposes. The Court of Appeals for the Second Circuit explored this factor at length in Consolidated Edison ofNew York, Inc. v. Pataki, in which the Court concluded that an act of the
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New York state legislature constituted an unconstitutional bill of attainder under Article 1, § 10 of the Constitution. 292 F.3d at 345. Based on a finding that Consolidated Edison ("Con Ed") had "failed to exercise reasonable care on behalf of the health, safety and economic interests of its customers," when it failed to promptly replace steam generators it knew to be faulty, and which then failed, the New York legislature passed a law forbidding Con Ed from passing along the costs associated with the outage to the ratepayers. Id. at 344-45.
The Second Circuit found that the State had no valid non-punitive reason that justified singling out Con Ed. It rejected the State's argument that the statute had the legitimate nonpunitive purpose of preventing innocent ratepayers from paying for Con Ed's mistakes. The statute, the Court concluded, did more than simply re-distribute or minimize costs. Rather, the "type and severity of the burdens imposed" by the statute belied the legitimacy of the regulatory justification. [do at 353. There was little question that Con Ed could have passed on the cost of obtaining power elsewhere if it had replaced the generators during a scheduled outage; " [w]hat then," the Court asked, "other than punishment can justify forcing Con Ed to absorb these same costs after the accidental outage?" Id. Further, the legislature could have enacted "less burdensome alternatives" to achieve its legitimate objectives, such as excluding "those substantial costs that would have been incurred absent misconduct on Con Ed's part." Id. at 354.
Here, in defending Section 163, the government argues that, because there was no formal congressional finding of misconduct against ACORN, the bar on all funding to ACORN is not punitive. But, as in Con Ed, the nature of the bar and the context within which it occurred make it unmistakable that Congress determined ACORN' s guilt before defunding it. Wholly apart from the vociferous comments by various members of Congress as to ACORN's criminality and
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fraud, as described below, no reasonable observer could suppose that such severe action would have been taken in the absence of a conclusion that misconduct had occurred.
The government also emphasizes that Congress withheld funds from plaintiffs for a limited time for the non-punitive reason of protecting "the public fisc," not to penalize ACORN for past wrongdoing. But Congress's interest in preventing future misconduct does not render the statute regulatory rather than punitive. Deterring future misconduct, as Con Ed stressed, is a traditional justification of punishment. See Con Ed. , 292 F.3d at 353; see also Brown, 381 U.s. at 458; Selective Service, 468 U.S. at 851-52 ("Punishment is not limited solely to retribution for past events, but may involve deprivations inflicted to deter future misconduct.").
The government further suggests that there was an emergency requiring immediate suspension of ACORN's funding and the initiation of an investigation. But under Con Ed, there must be some connection between the burdens of the statute and the government's purpose in enacting it. See Con Ed, 292 F.3d at 354. Here, although investigations of ACORN by state and federal agencies are underway, no congressional investigation of ACORN was initiated as part of the challenged legislation, nor did Congress order any agency of government to conduct an investigation. This undercuts the asserted emergency rationale.
Moreover, the award of grants and contracts by federal agencies IS governed by comprehensive regulations that have been promulgated to address the very concerns Congress has expressed about ACORN. There is no indication that Congress found these available mechanisms for investigation, leading to possible, and even immediate, suspension, by grantawarding agencies, inadequate to address the various allegations of misconduct. For example, the Code of Federal Regulations establishes a formal process for determining when federal contractors can be suspended or debarred. See, e.g., 2 C.F.R. Ch. I , Part 180. Subpart G of this part provides that a suspending official may impose suspension after considering a range of
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factors; the official can even take "immediate action" if "necessary to protect the public interest." See, e.g., 2 C.F.R. § 180.705 ("In deciding whether immediate action is needed to protect the public interest, the suspending official has wide discretion ....").
The goverrunent also argues that Congress's enactment of three 2010 appropriations acts containing no bar on funding ACORN, out of four signed into law thus far, belies the alleged punitive intent behind Section 163. This argument of course further undercuts the goverrunent's emergency rationale: if there were an emergency requiring the draconian action taken by Congress in Section 163, no explanation has been offered by the goverrunent as to why that emergency would apply only for some agencies and not others. And, the goverrunent agrees that, even for those agencies whose appropriations acts do not limit funding for the plaintiffs for fiscal year 2010, the plaintiffs remain barred from available funds appropriated to those agencies in previous years so long as Section 163 is in force . Pre!. Inj. Tr. 14-15, Dec. 4, 2009. See also OMB Memorandum (Oct. 7, 2009) (" [T)he text of [S)ection 163 is sufficiently broad to cover funding that was made available for fiscal year (FY) 2009 and prior fiscal years, as well as funding that is or will be made available for FY10."). Most importantly, in the absence of any justification for distinguishing among agencies, that the restriction does not cover every agency' s appropriations does not affect its punitive nature.
That ACORN was singled out is obvious and undisputed by the goverrunent. In Nixon, the Supreme Court found that a statute naming former President Nixon specifically was not necessarily a bill of attainder. The specific mention of his name was "easily explained by the fact that at the time of the Act's passage, only his [papers and recordings) demanded immediate attention." 433 U.S. at 472. Nixon, and only Nixon, had entered into an agreement with a depository which called for destruction of the materials upon Nixon' s death. Thus, Nixon "constituted a legitimate class of one, and this provides a basis for Congress' decision to proceed
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with dispatch with respect to his materials while accepting the status of his predecessors' papers and ordering the further consideration of generalized standards to govern his successors." Id.
Here, the government has offered no similarly unique reason to treat ACORN differently from other contractors and to bar the funding of ACORN without either a judicial trial or the administrative process applicable to all other government contractors. The specificity of Section 163 aggravates the punitive nature of the statute.
As in Con Ed, none of the government's justifications stand up to scrutiny. I can discern no non-punitive rationale for Congressional preclusion of the plaintiffs, and the plaintiffs alone, from federal funding.
3. Legislative Intent The third, and final , element in determining whether an act is punitive is legislative intent. See Selective Service, 468 U.S. at 852. "The legislative record by itself is insufficient evidence for classifying a statute as a bill of attainder unless the record reflects overwhelmingly a clear legislative intent to punish." Con Ed., 292 F.3d at 354. Determining Congress' s intent is often a difficult exercise; the stated comments of one legislator do not necessarily represent the unspoken thoughts of others who voted for a bill. Particular difficulties present themselves in this case, where legislators have discussed ACORN in a variety of contexts, making it difficult to separate out legislative intent for Section 163 in particular. Nevertheless, since the Supreme Court instructs that legislative intent is a key part of the framework for determining whether a legislative act is a bill of attainder, it must be examined. Here, the task is made easier because the legislative history that the government itself relies on as evidence of non-punitive intent unmistakably indicates punitive intent. The government relies on the statements of Senator Mike Johanns, who sponsored a provision defunding ACORN in the Department of Interior' s appropriation act, which provision is similar
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to the language of Section 163. He stated that he was proposing the legislation "to defend taxpayers against waste, fraud, and abuse." 155 Congo Rec. S9517 (daily ed. Sept. 17,2009). Senator Johanns also urged Congress to act because ACORN was "in an absolute free fall when it comes to allegations of illegal activity" and was "besieged by allegations of fraud and corruption and employee wrongdoing." Id. Such statements require an implicit finding of wrongdoing by the plaintiffs; protection of taxpayers ' money is a logical justification for Section 163 only if wrongdoing is assumed.
The punitive nature of the just-quoted comments of Senator Johanns is manifest when they are considered in light of Senator Johanns 's other comments about ACORN, in the context of other proposed legislation seeking to defund the organization. See, e.g., 155 Congo Rec. S9317 (daily ed. Sept. 14, 2009) (statement of Sen. Johanns) ("Somebody has to go after ACORN. Madam President, I suggest this afternoon that 'somebody' is each and every Member of the Senate."). Other legislators echo this punitive sentiment. See, e.g., 155 Congo Rec. S9314 (daily ed. Sept. 14,2009) (statement of Sen. Kit Bond) (stating that "[w]e cannot allow taxpayer funds to support groups engaged in repeated voter registration fraud activities, and now their repeated assistance for housing, tax, and mortgage fraud.") In addition, the staff of Representative Darrell Issa authored an 88-page report entitled " Is ACORN Intentionally Structured As A Criminal Enterprise?", which states that "ACORN has repeatedly and deliberately engaged in systemic fraud" and accuses ACORN of conspiring to use taxpayer funds for partisan purposes.9 The government correctly notes that the Issa Report was authored solely

9

With respect to plaintiffs' allegations that Section 163 is intended to punish ACORN for its

impennissible partisanship, a statement Representative Issa made in response to OLC's October 23,2009

memorandum construing the scope of Section 163 is noteworthy. [n that statement, Representative Issa

accused OLC of "old-fashioned cronyism" and stated that "[t]axpayers should not have to continue

subsidizing a criminal enterprise that helped Barack Obama get elected President." Press Release, Rep.

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by Representative Issa's office and was not commissioned by Congress. Nevertheless, particularly because Senator Johanns himself requested that its executive summary be entered into the congressional record, it is relevant to this inquiry. See ISS Congo Rec. S9309 (daily ed. Sept. 14,2009) (statement of Sen. Johanns).10
Without more, legislative history may not be enough to render the legislation a bill of attainder. But these statements underline the punitive nature of the government's purportedly non-punitive reason. See Con Ed, 292 F.3d at 355. ("[T]he stated intent of at least some legislators-most notably one of the floor managers of the legislation- to punish Con Ed reinforces our independent conclusion that a substantial part of the legislation cannot be justified by any legislative purpose but punishment.").
The Supreme Court counseled in Flemming that each attainder case "turn[s] on its own highly particularized context." Flemming, 363 U.S. at 616. Here, as in Lovett, Congress deprived the plaintiffs of an opportunity available to all others. In these circumstances, where the plaintiffs have received many federal grants and contracts over the years, it cannot be said that such deprivation is anything short of punishment as that has been understood in the bill of attainder cases. Section 163, by singling out ACORN and its affiliates for severe, sweeping restrictions, constitutes punishment under the three factors the Supreme Court has articulated for

Darrell Issa, Issa Blasts Administrative Decision to Fund ACORN - Reeks of Political Cronyism (Nov.

27,2009) (attached to plaintiffs' reply memorandum of law as Exhibit I).

10

At least one representative, Representative Rush Holt, voiced his concern that the provision was a

bill of attainder. See 115 Congo Rec . H9975 (September 25, 2009) (statement of Rep. Holt). In his

comments, Rep. Holt referenced a report from the Congressional Research Service. This report, which

was written regarding a different bill, "the Defund ACORN Act," analyzed that bill and concluded that "a

court would have a sufficient basis to overcome the presumption of constitutionality and find that [the

Defund ACORN Act violates the prohibition against bills of attainder." Kenneth Thomas, U.S

Congressional Research Service Report for Congress: The Proposed 'Defund ACORN Act': Is it a Bill of

Attainder? (Sept. 22, 2009). The Defund ACORN Act has not been enacted, and is not at issue in this

case.

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making this detennination. I therefore conclude that the plaintiffs have established a likelihood of success on the merits of their bill of attainder claim. II
B. Irreparable Harm That the plaintiffs have shown a likelihood of success on the merits does not alone entitle
them to a preliminary injunction. Rather, irreparable harm is "[pJerhaps the single most important prerequisite for the issuance of a preliminary injunction." Bell & Howell: Mamiya Co. v. Masel Supply Co. Corp., 719 F.2d 42, 45 (2d Cu. J983) (internal quotation marks omitted). If an injury can be compensated by monetary damages, then "no irreparable injury may be found to justify specific relief." Register.com, Inc. v. Verio, Inc., 356 F.3d 393 , 404 (2d Cir. 2004). "But, irreparable hann may be found where damages are difficult to establish and measure." [d.
The plaintiffs have been the recipients of significant federal grants; their expectations of awards of renewals and new grants cannot be dismissed as speculative. The government does not dispute that ACORN Institute has pending contracts that have been suspended while Section 163 is in force. For example, ACORN Institute has six ongoing contracts with HUD, totaling approximately $40,000 to $60,000 per year, to provide services to public housing residents, which contracts have been suspended. Plaintiff NYAHC has a subcontract that was funded by HUD that also was suspended. The government also does not dispute that ACORN Institute has pending applications with federal agencies which will not be considered while Section 163 is in force. For example, ACORN Institute cites pending applications with both the Department of Commerce and the Environmental Protection Agency. It is undisputed that those contracts may be awarded to other parties, and then become unavailable to the plaintiffs. Nor does the government dispute that ACORN Institute had been approved as a subcontractor on a grant

11

Because I find Section 163 unconstitutional under the Bill of Attainder Clause, I do not reach the

plaintiffs' claims under the First Amendment and the Due Process Clause.

18

Case 1:09-cv-04888-NG -LB Document 9 Filed 12/11/09 Page 19 of 21
funded by the Department of Agriculture, but, before the contract for that grant could be signed, the contractor cancelled the grant because of Section 163. ACORN Institute also asserts that it had another subcontract, also funded by the Department of Agriculture, that would have been renewed if not for Section 163.
The plaintiffs identify these harms, and a wide range of others, as irreparable. Several of the harms that the plaintiffs allege, such as the layoff of a large percentage of ACORN Institute's staff, undoubtedly cannot at this point be attributed solely to Section 163. But the government does not dispute that the deprivation of the opportunity to obtain renewals of existing contracts and compete for other contracts is non-compensable by money damages. See Lion Raisins, Inc. v. United Slales, 52 Fed. CI. 115 (Fed. CI. 2002) (concluding that the plaintiff, which was wrongfully suspended from government contracting, could not recover its lost profits on a contract that its suspension precluded it from bidding on). Notably, even in nonconstitutional cases that involve suspension or debarment from federal contracting, courts have granted preliminary injunctive relief where money damages will not be available and where the contractor has made a sufficient showing on the merits of its claim. See, e.g., Alfv. Donley, --F. Supp. 2d ---, 2009 WL 3461128 at *7-*8 (D.D.C. Oct. 29, 2009) (taking into account the plaintiff's inability to recoup lost income because of sovereign immunity as a factor in finding irreparable harm). Even putting aside the role of sovereign immunity in barring the recovery of damages, and any other limitations on the recovery of damages by government contractors where sovereign immunity has been waived, the amount of money tbe plaintiffs might have been awarded had they been allowed to compete for contracts is, as the government acknowledges, impossible to calculate.
A finding of significant violation of constitutional rights also supports the finding of irreparable harm. See Milchell v. Cuomo, 748 F.2d 804, 806 (2d Cir. 1984) ("When an alleged
19

Case 1:09-cv-04888-NG -LB Document 9 Filed 12/11/09 Page 20 of 21
deprivation of a constitutional right is involved, most courts hold that no further showing of irreparable injury is necessary. "); see also 11 A Charles Alan Wright, Arthur R. Miller, and Mary Kay Kane, Federal Practice And Procedure § 2948 .1 (2d ed. 2009) (same). For all of the abovedescribed reasons, I conclude that the plaintiffs have established the likelihood of irreparable harm.
Finally, issuance of a preliminary injunction will serve the public interest. In deciding preliminary injunction motions, courts "must balance the competing claims of injury and must consider the effect on each party of the granting or withholding of the requested relief." Winter v. Natural Res. De! Council, Inc., --- U.S ---, 129 S. Ct. 365, 376 (2008). The plaintiffs have raised a fundamental issue of separation of powers. They have been singled out by Congress for punishment that directly and immediately affects their ability to continue to obtain federal funding, in the absence of any judicial, or even administrative, process adjudicating guilt. The potential harm to the government, in granting the inj unction, is less. The public will not suffer harm by allowing the plaintiffs to continue work on contracts duly awarded by federal agencies, which was stopped solely by reason of Section 163. For grants for which the plaintiffs have applied, or for which they will apply, each agency will continue to be able to use its discretion to determine the merit of the plaintiffs' proposals, and to suspend the contracts for cause, or even to debar ACORN, if warranted under the terms and procedures in the contracts and applicable regulations. Therefore, balancing "the competing claims of injury," I find a preliminary injunction to be in the public interest.
CONCLUSION The plaintiffs have established a likelihood of success on the merits of their bill of attainder claim. They have also established the likelihood of irreparable harm absent an injunction and that issuance of a preliminary injunction is in the public interest. Therefore the
20

Case 1:09-cv-04888-NG -LB Document 9 Filed 12/11/09 Page 21 of 21

plaintiffs' motion for a preliminary injunction is GRANTED.12 A preliminary injunction in the
following form shall issue:
Defendants the UNITED STATES OF AMERICA; SHAUN DONOVAN, in his official capacity as Secretary of the Department of Housing and Urban Development; PETER ORSZAG, in his official capacity as Director of the Office of Management and Budget; and TIMOTHY GEITHNER, in his official capacity as Secretary of the Department of Treasury of the United States; and all those acting in concert with them, are hereby
ENJOINED, during the pendency of this action, from enforcing Section 163 of Division B - Continuing Appropriations Resolution, 2010, Pub. L. No. 111-68, § 163 , 123 Stat. 2023, 2053 (2009), as renewed by Division B - Further Continuing Appropriations Resolution, 2010, Pub. L. No. 111-88, § 101, 123 Stat. 2904, 2972 (2009), which provides that "None of the funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now (ACORN), or any of its affiliates, subsidiaries, or allied organizations." The defendants are hereby further
ENJOINED, during the pendency of this action, from enforcing the Office of Management and Budget Memorandum, entitled "Memorandum for the Heads of Executive Departments and Agencies" providing "[gJuidance on [SJection 163 of the Continuing Resolution regarding the Association of Community Organizations for Reform Now (ACORN)," dated October 7, 2009.

Jl, Dated: December 2009
Brooklyn, New York

SOpRDEREJ>. ,
s/ Nina Gershon
NINA GERSHON United States District Judge

12

Although Rule 65 provides that "no restraining order or preliminary injunction shall issue except

upon the giving of security by the applicant, in such sum as the court deems proper," "an exception to the

bond requirement has been crafted for, inter alia, cases involving the enforcement of 'public interests ' ...

." Pharmaceutical Soc. ofState ofNew York, Inc. v. NY. Dep 't ofSoc. Services, 50 F.3d 1168, 1174 (2d

Cir. 1995). Because I find this action, which implicates important constitutional questions, to be in the

public interest, the bond requirement is waived.

21

 
 Case 1:09-cv-04888-NG -LB Document 15 Filed 12/17/09 Page 1 of 7

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

ASSOCIATION OF COMMUNITY ORGANIZATrONSFOR REFORM NOW; ACORN INSTITUTE, INC.; And NEW YORK ACORN HOUSING COMPANY, INC.
Plainti ffs,
versus
UNITED STATES OF AMERICA; SHAUN DONOVAN, Secretary of the Departmentof Housing and Urban Development;PETER ORSZAG, Director, Office of Management and Budget; and TIMOTHY GEITHNER, Secretary of tbe Department of Treasury of the United States,
Defendants.

CIVIL ACTION NUMBER 09-CV-4888 (NG)(LB)

MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFFS MOTION TO MODIFY OR AMEND THE PRELIMINARY INJUNCTION
On Friday, December 11, 2009, this Honorable Court issued an opinion and order, enjoining Defendants during the pendency of this action from enforcing Section 163 of the Continuing Appropriations Resolution and the OMB Memorandum implementing that Section. See Dkt ## 9, 10. On December 10 and December 13,2009, the House and Senate respectively enacted H.R. 3288, the FY 2010 Consolidated Appropriations Act. On December 16, 2009, President Obama signed into law that Act, which is Public Law _ _ __ __ . That Act, and specifically Sections 418,534 and 511, continues for Fiscal Year 2010 the Bill of Attainder

Case 1:09-cv-04888-NG -LB Document 15 Filed 12/17/09 Page 2 of 7
against ACORN that this Court enjoined on December 11. I Therefore Plaintiffs now move to modify or amend that injunction to include the prohibitions on funding ACORN contained in the FY 2010 Consolidated Appropriations Act, Pub Law ___, and Section 427 of the Department ofthe Interior, Environmental and Related Agencies Appropriations Act 2010, Pub Law 111-88. "It is, of course, well established that a district court has the power, in the exercise of its discretion, to modify its past injunctive decrees in order to accommodate changed circumstances." Davis v. N.Y. Hous. Auth., 278 F. 3d 64,88 (2d Cir. 2002).
POINT I The Defund ACORN provisions of the Consolidated Appropriations Act Constitute a Bill
of Attainder for the Reasons Set Forth in the Court's December 11 Opinion Public Law _ _ is a consolidation of various appropriation acts and is therefore subdivided into various divisions providing appropriations for different agencies' appropriations. Public Law includes three Bills of Attainder: Sections 418, 534, and 511. Section 418 of the Act, which is part of Division A providing for the Transportation and Housing and Urban Development appropriations contains identical language to Section 163 of the Continuing Resolution: SEC. 418. None of the funds made available under this Act or any prior Act may be provided to the Association of Community Organizations for Reform Now (ACORN), or any of its affiliates, subsidiaries, or allied organizations. Pub Law_ Division A, Section IV. This section requires that no funds made available from "any prior Act" may be provided to ACORN or any of its subsidiaries, affiliated or allied organizations. Therefore, any
I The last appropriations bill for fiscal year 2010 is H.R. 3326, the Department of Defense Appropriations Act 2010, which has passed both the Senate and House and awaits the President's signature. Section 9012 of that bill also includes a defund ACORN provision. Plaintiffs will notify the Court immediately if and when President Obama signs that bill and requests that Section 9012 of the act be included in the modified injunction.
2

Case 1:09-cv-04888-NG -LB Document 15 Filed 12/17/09 Page 3 of 7
appropriation act already enacted into law, including the four acts referenced by the govemment in its memorandum in opposition to the preliminary injunction (three of which contained no ACORN language), would be subject to the prohibition contained in Section 418. So too, any monies still unspent under prior year appropriation acts, or funds allocated under multiyear contracts such as the Ross contracts, would also be barred from ACORN.
Section 418's language also facially suggests that no funds made available by any division of the Consolidated Appropriations Act could be provided to ACORN. However, Section 3 of the overall act, entitled references, provides that, "except as expressly provided, any reference to 'this act,' contained in any division of this Act shall be treated as referring only to the provisions of that division." Therefore, the "this act" language of Section 418 should be limited to Division A of the Act, which pertains solely to Transportation and HUD funding .
Section 418 thus provides that no HUD or Transportation funds may go to ACORN related organizations, nor can any funds appropriated from any prior act go to such organizations. The Ross Contracts will continue to be suspended by HUD, any pending ACORN applications to HUD, Transportation, or the agencies funded by the prior enacted appropriation acts must be preemptively denied, ACORN related organizations are precluded from applying for any such grants, nor can subcontractors funded by HUD, Transportation, nor any of the other agencies whose appropriations are already enacted into law continue their relationships with plaintiffs.
For the reasons already set forth in this Court's opinion of December II, Section 418 is an unconstitutional Bill of Attainder.
The Consolidated Appropriations Bill also contains two other unconstitutional Bills of Attainder. Section 534 of Division B of the Act, which appropriates funds for Justice/Commerce
3

Case 1:09-cv-04888-NG -LB Document 15 Filed 12/17/09 Page 4 of 7
and Science provides that, "None of the funds made available under this Act may be distributed to the Association of Community Organizations for Reform Now (ACORN) or its subsidiaries." Again, "this act" is limited to Division B under the rule of construction set forth above.
Section 5) ) of Subdivision E of the Act, which appropriates funds for military and VA functions, states that "None of the funds made available in this division or any other division of this Act may be distributed to the Association of Community Organizations for Reform Now (ACORN) or its subsidiaries." This language explicitly applies not only to subdivision E, but "to any other division" of the Consolidated Appropriations Act, and therefore prohibits any federal funding from the FY 20) 0 appropriations bill from being provided to ACORN and non-defined subsidiaries.
In sum, each of these three provisions, as well as Section 427 of the Interior Bill already enacted,2 constitutes a Bill of Attainder. Certainly, in combination they constitute a Bill of Attainder and continue the ban offederal funding contained in Section 163 of the Continuing Resolution. In combination they prohibit any funds from being distributed to ACORN and related organizations from any Fiscal Year 20 I0 Appropriation Act and any prior act that provides any federal funds. Nor can the government suggest, as it did with respect to Section 163 of the CR, that these measures are simply emergency, few month stop gap provisions. Rather, these new provisions bar federal funding for ACORN indefinitely, and at minimum until the end of Fiscal Year 2010.3 The provisions have the same infirmities that this Court has
2 Section 427 of Public Law 111-88 states that "None of the funds made available under this Act may be distributed to the Association of Community Organizations for Reform Now (ACORN) or its subsidiaries." 3 Section 535 of Subdivision B of the Consolidated Appropriation Act provides for an investigation of ACORN by the Comptroller General:
4

Case 1:09-cv-04888-NG -LB Document 15 Filed 12/17/09 Page 5 of 7
already found rendered Section 163 unconstitutional. They each explicitly name ACORN and
related organizations, contain no method for ACORN to remove itself from the disbarment,
bypass and evade the extensive govemmental regulations providing for suspension and
SEC. 535. (a) The Comptroller General of the United States shall conduct a review and audit of Federal funds received by the Association of Community Organizations for Reform Now (referred to in this section as "ACORN") or any subsidiary or affiliate of ACORN to determine-
(I) whether any Federal funds were misused and, if so, the total amount of Federal funds involved and how such funds were misused;
(2) what steps, if any, have been taken to recover any Federal funds that were misused;
(3) what steps should be taken to prevent the misuse of any Federal funds; and
(4) whether all necessary steps have been taken to prevent the misuse of any Federal funds.
(b) Not later than 180 days after the date of enactment of this Act, the Comptroller General shall submit to Congress a report on the results of the audit required under subsection (a), along with recommendations for Federal agency reforms.
On its face, and viewed independently of the other Bill of Attainder provisions of the Act, Section 535 does not constitute an unlawful bill of attainder, and plaintiffs do not challenge it here nor seek to enjoin its operation in this action. Nonetheless, Section 535 is clearly illustrative of Congress's punitive purpose in enacting Section 534, Section 418 and Section 511 of the Bill. For the Act as a whole cuts off ACORN funding for the entire fiscal year irrespective of the results of the Comptroller General's investigation. The three challenged provisions cut plaintiffs' access to federal funds and federal contracts for at least a year, even if the Comptroller General concludes within the 180 days allotted for hislher investigation that ACORN has not committed any misuse of federal funds. While the Bill of Attainder Clause would prohibit Congress from cutting off a named organization's funds for misconduct for a year pending an investigation, that Congress here did not key its defunding of ACORN to the results of the Comptroller General's investigation simply further underscores Congress' already obvious punitive intent in enacting the defund ACORN provisions of these appropriation bills.
Moreover, Congress did not even require the Comptroller General to make any recommendations about what to do with respect to future funding of ACORN after it concludes its investigation. Instead, it requires "recommendations for federal agency reforms," a requirement that only makes sense if the Comptroller General concludes that federal funds were misused. Subpart b of Section 535 thus assumes that the Comptroller General will conclude that funds were misused.
5

Case 1:09-cv-04888-NG -LB Document 15 Filed 12/17/09 Page 6 of 7
disbannent of contractors with due process, and "no reasonable observer could suppose that this severe action [more lengthy than the CR] could have been taken in the absence of a Congressional conclusion that misconduct had occurred." December 11 Opinion at p. 13. Ifnot enjoined, these provisions would continue the irreparable harm that this Court already found plaintiffs were suffering from the enactment and enforcement of Section 163 of the Continuing Resolution.
CONCLUSION For the reasons already stated in this Court's December 11,2009 Opinion and Order (DIct # 9), the Court should modify or amend the injunction it has already issued to prohibit the government from enforcing Sections 418,534 and 511 of the Consolidated Appropriations Act which prohibit the distribution of funds to ACORN and related organizations, and Section 427 of the prior enacted Appropriations Bill for Interior Environmental and Related Agencies. Dated: New York, New York December 17, 2009
Respectfully submitted, Center for Constitutional Rights
Darius Charney (DC 1619) William Quigley (Legal Director) 666 Broadway, 7th Floor New York, NY 10012 Tel.: (212) 614-6475; (212) 614-6427 Fax: (212) 614-6499 CCR Cooperating Attorneys Jules Lobel (admitted in NY & this court JL8780) 3900 Forbes Avenue Pittsburgh, PA 15260
6

Case 1:09-cv-04888-NG -LB Document 15 Filed 12/17/09 Page 7 of 7 Goodman & Hurwitz, P.C. William Goodman (admitted in NY & this court WGl241) Julie H. Hurwitz 1394 East Jefferson Detroit, Michigan 48207 Arthur Z. Schwartz (AZ52683) 275 Seventh Avenue New York, NY 10001
7

 
 Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 1 of 17

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NEW YORK
• - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

ASSOCIATION OF COMMUNITY ORGANIZATIONS FOR REFORM NOW, et aI.,

Civil Action No.
09-CV-4888 (NG)

Plaintiffs,

(Gershon, J.)

vs.

(Bloom, M.J.)

UNITED STATES OF AMERlCA, et aI.,

Defendants . - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

FEDERAL DEFENDANTS' RESPONSE TO PLAINTIFFS' MOTION TO MODIFY OR AMEND THE PRELIMINARY INJUNCTION

INTRODUCTION

On December 17, 2009, plaintiffs filed a motion to amend the Court's December 11, 2009

Preliminary Injunction to include the prohibitions on funding ACORN and its affiliates found in the

recently enacted Consolidated Appropriations Act, 20 I0 (H.R. 3288) (Consolidated Appropriations

Act) and the previously enacted Department of Interior, Environmental, and Related Agencies

Appropriations Act, 2010 (Pub.L.No. 111-88). Plaintiffs ask this Court to further extend an

impermissibly broad reading of the Bill of Attainder Clause well beyond its historical meaning.

This Court should reject plaintiffs ' requests for at least three reasons. First, as this Court has

explicitly recognized, neither the United States Supreme Court nor the Court of Appeals for the

Second Circuit has ever found a temporary Congressional restriction on an organization's

opportunity to apply for discretionary federal funds to be punishment for purposes of the Bill of

Attainder Clause. For the reasons previollsly advanced by the Government, as well as those below,

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 2 of 17
a temporary restri ction on an organization 's access to federal funds is not punishment. Second, the terms and legislative history of the newly enacted Consolidated Appropriations
Act confirm what the government has previously explained: the tcmporary restrictions at issue in thi s case serve a valid, important, non-punitive purpose, and they are not unconstituti onal punishment. Congress has mandated that the Comptroller General audit and review ACORN's potential misuse of Federal funds and report back to Congress in 180 days, while suspending ACORN's eligibility for fede ral funding until after that investigation is concluded. That provision confirms that the funding restri ctions here arc not punislunent. Instead, it is part of an effOit to protect, for a temporary time period, against the potential fTaud, waste and abuse of public fund s while a more thorough anal¥sis of any misuse of federal funds by plaintiffs is conducted.
Third, the constitutionality of the congressional decision that a temporary cessation of funding is appropriate is particularly clear given the findings of the investigative report commi ssioned by ACORN itself and authored by the former Attorney General of Massachusctts, Scott Harshbarger (thc "Harshbarger Report"). This independent analysis amply documents ACORN's " longstanding management weaknesses" and "obvious" " internal potential for fraud." ACORN's own self-examination reinforccs the non-punitive basis for the fu nding restriction
In short, a temporalY restriction on grants or contracts to allow a full congressional investigation of what appear on their face to be major problems with a grantee - serious and "credible allegations offraud and abuse as well as serious management and accountabi lity problems that have been identified as a result - is not equivalent to a bar on pursuing one's profession and is not punishment. Accordingly, plaintiffs' motion should be denied in fu ll.
In the alternative, if this Court does amend or modify the preliminalY injunction issued on
2

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 3 of 17
December 11 ,2009, plaintiffs should be required under Rule 65(c) to give security for the costs that the Department of Housing and Urban Development (HUD), or any otber agency, would incur in complying with the inj unction. This bond would be forfeited ifit sbould later be determined tbatthe Agency was wrongfully enj oined.
STANDARD OF REVIEW Plaintiffs seek an order modifying or amending tbe Court's prelim inary injunction pursuant to Fed.R.Civ.P. 59(e). Ru le 59(e) states that "A motion to alter or amend ajudgment must be fil ed no later tban 28 days after the entry of the judgment." Altbougb tbe Rule "does not [necessarily] prescribe specific grounds for granting a motion to alter or amend an otherwise final judgment," Munafo v. Metropolitan Transp. Authority. 38 1 F.3d 99,105 (2d Cir. 2004), "district courts may alter or amend aj udgment 'to correctaclear error oflaw or prevent manifest injustice. ", Id. (quoting Colli son v.l nCI Chern. Workers Union, Local 2 17, 34 FJd 233, 236 (4th Cir. 1994)).
ARGUMENT A. A T emporary Restriction On The Opportunity To Apply For Discretionary
Government Funds, Based On Admitted Financial Wrongdoing, Is Not An Un constitutional Legislative Punishment As tbis Court acknowledged, the "idea that the depri vation of the opportunity to apply for discretionary federa l funds is 'puni tive' within the meaning of the attai nder clause seems impl ausible. Neither the Supreme Court nor the Second Circuit has been faced with such a claim." 0l?inion and Order ("Opinion") at 9. Indeed, the historical meaning of legislative punishment "originally connoted a parliamentary Act sentencing a named ind ividual or identifiable members ofa group to death ," and at the time of the Founding was also applied to
3

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 4 of 17
such indubitably punitive measures as imprisonment, banishment, and the punitive confiscation of property. N ixon v. Adm ' r of Gen. Servs., 433 U.S. 425, 473-74 (I 977). Since the Constitution's enactment , the Supreme Court has found only a fe w statutes to be unconstitutionally punitive, and all of those exceptional enactments have been outri ght, permanent " legislative bars to participation by individuals or groups in specific employments or professions." Selective Servo Sys. V. Minn. Pub. Interest Research Group, 468 U.S. 84 1, 852 (1984). Neither the hi story nor the Court's cases suggest that Congress is forbidden from temporarily restricting eligibility to apply for discretionary federal funds on the theory that the restriction "puni shes" the restricted organization. I Cf. Nat' l Endowment for the Arts v. Fi nley, 524 U.S. 569, 587-88 ( 1998) (making clear that in issuing grants, Congress enj oys considerable constitutional latitude). Nonetheless, plai ntiffs ask the Court to take a dramatic furt her step to stretch the meaning of historical punishment by amending its injunction.
Analyzing the historical meaning of legislative punishment, this Court found United States v. Lovett, 328 U.S. 303 (1946), "particularly instructi ve," and concluded "the Court in Lovett did not base its decis ion on a property rights analysis." Opinion at 9, 10. But in Lovett, the law held to be a bi ll of attainder cut off salaries to three named federal civil servants who "had been fo r several years worki ng for the Government." Lovett, 328 U.S. at 304. Moreover,
I Thi s Court also refers to an unpublished district court decision in another Circuit which concluded that a state restriction on fundin g of a particular contractor was an unconstituti onal bill of attainder. See Fla. Youth Conservation Corns., Inc. v. Stutler, 2006 WL 1835967, at *2 (N.D. Fla. June 30, 2006). However, that same Circuit subsequen Uy upheld in a precedential opinion legislative restrictions preventing certain groups from access to discretionary government funding, concluding that those restrictions d id not inflict punishment but instead furthered "the non-punitive goal of allocating resources." See Houston v. Willi ams, 547 F.3 d 1357, 1 360~6 1 , 1364 (11th C ir. 2008).
4

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 5 of 17
the statute was not a simple restriction on the funds appropriated for a single fiscal year, but rather applied indefinitely into the future, to "any appropriation ... which is hereafter made." Id. at 305 n.l. Its purpose "was not merely to cut off [the employees') compensation through regular disbursing channels but pennancntly to bar them from government serv ice." 14,. at 313. "Over the protest of those employing agencies," Congress nonetheless barred the use of federal funds to pay the respondents. 14,. at 305.
The parties have ass umed in this Court that the Bill of Attainder Clause protects corporations as well as individuals, an issue that has not been resolved by the Supreme Court but is addressed by controlling precedent in the Second Circuit? See Conso!. f-<::d ison Co. of New York v. Pataki, 292 F.3d 338, 349 (2d Cir. 2002). But even assuming the Clause does apply to corporations, "it is obvious that there are differences bctween a corporation and an individual under the law," and, therefore, "any analogy between prior cases that have involved individuals and this case, which invo lves a corporation, must necessarily take into account this diffcrence." BellSouth Corp. v. FCC, 162 F.3d 678, 683-84 (D.C. Cir. 1998); see also Con. Ed., 292 F.3d at 354 ("There may well be act ions that would be considered punitive if taken against an individual, but not if taken against a corporation."). Even if the Supreme Court in Lovett did not solely base its decision on whether the respondents there had a "vested property right," a li fetime bar on all government emp loyment for an individual civi l servant already in government employment is a far ery from a temporary bar on an organization's receipt of discretionary federal funds for a month or even a year.
2 Defendants express ly reserve the right to challenge the applicabil ity of the Bill of Attainder Clause to corporations in any subsequent appellate proceedi ngs in this case.
5

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 6 of 17
Further distingui shing Lovett, the statute in that case was based on an express congressional determination that the three government employees were guilty of having subversive beliefs and associations. That determination followed hearings before "a special
,
subcommiuee of the Appropriations Committee . .. in secret executi ve session" from which even counsel for the employing federal agencies were barred. Id. at 3 10- 11 . The Court determined that thc "permanent proscription of any 0ppOitunity to serve the Government is puni siunent, and ofa most severe type," and " is a type of punishment which Congress has only invoked for special types of odious and dangerous crimes." Id. at 3 l 6. No such proceedings, adjudicati on or permanent proscription took place in the case at bar.
Indeed, quite to the contrary, the provisions of the Consolidated Appropriations Act reinforce the valid and non-punitive public purpose that underlies the tcmporary restriction at issue in thi s case. Rather than adjudicating ACORN's guilt, Congress has directed the Goverrunent Accountability Offi ce (GAO) to conduct an investigation into the possible mi suse of any federal funds. Section 535 of Division B of the Consoli dated Appropriations Act requires the Comptroller General of the United States (who is the head of the GAO) to conduct "a review and audit of Federal funds received by the Association of Community Organizations for Reform Now ... or any subsidi ary or affiliate of ACORN" to determine:
(1 ) whether any federal fund s were misused and, if so, the total amount of Federal fund s involved and how such funds were mi sused; (2) what steps, if any, have been taken to recover any Federal funds that were mi sused; (3) what steps should be taken to prevent the misuse of any Federal fund s; and (4) whether all necessary steps have been taken to prevent the misuse of any Federal fund s. H.R. 3288, II I'h Congo Div. 8., § 535(a) (enacted Dec. 16,2009).
6

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 7 of 17
Nor is Section 535 the only evidence of Congress' desire to gather the relevant facts.
Members of Congress called for an investigation of ACORN and intended for an audit or review to be conductcd.3 On September 23, 2009, two days before the House of Representatives passed
the Continuing Resolution, Congressman Lamar Smith (R-TX), Ranking Member of the
Committee on the Judiciary , and Congressman Darrell E. Issa (R-CA), Ranking Member on the
Committee on Oversight and Government Reform, wrote a letter to the GAO. See Exhibit I,
Letter from Congressmen Smith and Issa to The Honorable Gcne Dodaro, Acting Comptroller
General, September 23. 2009. After describing a series of allegations of fraud , waste and abuse
by ACORN , the Congressmen wrote:
Members of Congress have a responsibility to ensure that taxpayer dollars are used according to the purpose for which they are appropriated. When faced with numerous allegations of fraudulent and criminal conduct by a federal grantee, such as those that now face ACORN, it is important that Congress understand the extent to which ACORN may have defrauded the American people so that future Congresses can take steps to ensure that such blatant misuse of funds does not occur agai n and that wrong-doers are prosecuted.
Id. at 2 (emphasis added). As the Congressmen cmphasized, a GAO investigation was necessary
"to determine whether the organization misused congressionally appropriated funds." Id. at I
(emphasis added). Likewise, on the same day, 20 Senators wrote a separate letter to the GAO
requesting an investigation into ACORN ' s use of federal funds. See Exhibit 2, Letter from
3 Moreover, this call for a GAO investigation was intertwined with Congress' assessment of the anticipated ACORN internal investigation, ~ Mem. in Supp. of Defs. Mot for Reeons. at 3 n.3 (Dock. No. II). The Harshbarger Rcport confinned that "[tJhe culture of hands-off management that was a hallmark of the ACORN organizing model is inappropriate and risky when applied to service delivery under governmental contracts and other legal and regulatory requirements. " PI. Exh. G at 1S. This potential misuse of government funds was only exacerbated by U[t]he internal potential for fraud due to the lack of checks and balances and oversight ...." llL
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Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 8 of 17
Twenty Senators to The Honorable Gene Dodaro, Acting Comptroll er General, September 23, 2009. Again, the Senators emphasized the need to gather facts, writing:
Current votcr fraud investigations in several states, prior fraud convictions, and new videos showing apparent illegal activity by ACORN employees suggest that at the very least the organization warrants a top to bottom investigation on behalf of the taxpayer. Taxpayers deserve nothing less tha n a thorough and transparent accounting of ACORN's activities. ld. at 1. On December 7, 2009, the GAO accepted that the proposed investigation was within its authority, and responded to the Congressmen that it planned to combine the various requests, incl ud ing a separate request by Representative Rush Holt (D-NJ), into one engagement. See Exhibit 3, Letter from Ralph Dawn, Managing Director of Congressional Relations to Congressman Smith , December 7, 2009. The Comptroller General also agreed to contact relevant agency Inspectors General (lG), so as to avoid duplication of work. Jd . at 1; see. e.g., Exhibit 4, Review of Department of Justice Grants to the Association of Community Organizations for Reform Now, Inc. (ACORN) and its Affi liated Organizations (DOJ IG Report). These various IG investigations, such as the investigation performed by the Justice Department's OIG, have also been done at the behest of Congress. See. e.g., Ex hibit 4, DOJ 10 Report at I. The contrast to Lovett thus could not be more clear. Rather 111an making legislative j udgments as to guilt as was the situation in cases such as Lovett, Congress has expressly refTained from passing any such judgment, and has instead sought to put a temporary freeze on the dispersal of fede ral funds to allow the federal government to gather more information on the
8

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 9 of 17
allegations of fraud, waste, and abuse. The concerns about "star chamber" proceedings that underlie both the Bill of Attainder Clause and cases like Lovett are thus absent here.
More broadly, the text - and indeed the very existence - of Section 535 further confirms the absence of punitive intent. As the Supreme Court explained in Flemming v. Nestor, "[i]n determining whether legislation which bases a disqualification on the happening ofa certain past event imposes a punishment, the Court has sought to discern the objects on which the enactment in question was focused." 363 U.s. at 613- 14. And "[w]here the source of legislati ve concern can be thought to be the activity or status fro m which the individual is barred, the disqualification is not punishment even though it may bear harshly upon one affected." Jd . at 614.
Here, both the text of and legislative history behind Section 535 reinforce the conclusion that the ACORN-related provisions advance the non-punitive purpose of devising a means for safeguarding Federal funds for a brief period oftime to allow completion of the GAO inquiry. , Section 535 focuses the inquiry on "whether any Federal funds were misused" and what steps must be taken "to recover any Federal funds that were misused," )-I.R. 3288, 11 phCong., § 535(a)(I)-(2), and it requires the Comptroller General "[n]ot later than 180 days after the date of enactment of this Act" to submit to Congress "a report on the results of the audit" along with "recommendations for Federal agency reforms." Id.; § 535(b). Section 535 thus requires that the Comptroll er General report to Congress with a set of recommendations, so that Congress can then determine, based on its own judgment, where and how to allocate these discretionary fund s. And while plaintiJTs complain that the absence ofa date cC11ain for a restoration of fu nds undermines the non-punitive purposes evidenced by Section 535, see PI. Mem. at 5 n.3, the creation ofa relatively short time frame for the completion of the investigation indi cates a
9

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 10 of 17
congressional desire for a rapid resolution of the ACORN situation, and is entirely consistent wi th the non-punitive purposes of the legislation . See Flemming v. Nestor, 363 U.S. 603, 617 ( 1960) ("[O]nly the clearest proof could suffi ce to establish the unconstitutionality of a statute on such a ground. Judicial inquiries into Congressional motives are at best a hazardous matter, and when that inquiry seeks to go behind objective manifestations it becomes a dubious affair indeed.").
Moreover, the 180-day time fram e of the GAO investigation is consistent with the appropriations cycl e. Congress necessarily appropri ates funds for an entire fiscal year; conditions attached to the current year's funding are not permanent, do not automatically carry over to the next year's fu nding, and must be renewed if Congress wishes them to continue.~ Here, the GAO as the investigation will be done in time to allow Congress to decide whether to include similar ACORN-related restrictions in Fiscal Year 2011 appropriations acts. Plaintiffs object that the funding restriction does not expire when the GAO report is complete; that is simply a consequence of the fact that the GAO is performing an invest igative function; whatever conclusions for next year' s appropriations are warranted based on the investigative findings are for Congress to draw, not the Comptroll er General alone.
4 Congress certainly can and does provide for permanent conditions that apply each year without further Congressional action, but it chose not to do so here. See. e.g., Pub. L. No. 97-102, § 402, 95 Stat. 1442, 1465 (1 98 1) (providing that "none of the funds in this or any other Act shall hereafter be used" to approve certain ra il road abandorunents) (construed as a permanent restriction in 70 Compo Gen. 35 1 (Mar. 22, 199 1)); Cella v. United States, 208 F.2d 783, 790 (7th Cir. 1954) ("Congress has the power to enact permanent legislation in an appropri ation act. The usc of the word ' hereafter' by Congress as a method of making legislation permanent is a well-known practice.") (internal citation omitted). As noted above, the restriction in Lovett took that permanent form. See 328 U.S. at 306 n.l (restriction applied to appropriations " hereafter made").
10

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 11 of 17
The legislative history behind the enactm ent of Section 535 provides additional evidence
of Congress' lack of punitive intent. Section 535 originated when Senator Richard Durbin (D-IL) proposed Amendment No. 2647 to I-I.R. 2847, which was the appropriati ons bill for
Commerce, Justice, Science, and Related Agencies be fore it was fo lded into the Consolidated Appropriations Act. In explaining the rationale fo r thi s provision, Senator Durbin stated, in
pertinent part, as fo llows: First, we should find out the facts. I know ACORN is unpopular right now, and much of that scorn they deserve, but ACORN has a number of affi liated organizations. . . . To my knowledge, we havc not yet seen any review or analysis ofwhcthcr the misconduct was the work of a few empl oyees or whether the entire organ ization and all of its affiliates should be held responsibl e....
That is why I am proposing that we get to the bottom of this by having a thorough investi gation; that Congress direct the Government Accountability Office to review and report back to us within 180 days on whether any Federal fund s have been misused by ACORN or its affili ates; and, if so, in what amounts and in what ways. .. . The report I have called for should also identify the steps necessary to correct any defi ciencies, along with an assessment of whether all necessary steps have been taken to prevent any future misuse of Federal fund s. The GAO will be able to conduct a government-wide review-not just one agency-looking at any fund s ACORN or i1S affili ates have received from any Federal agency. It will be a complete and comprehensive review and investigati on. 155 Congo Ree. S I01 81, S I02 11 - 12 (daily ed. Oct. 7, 2009) (statement of Sen. Durbin).
Likewise supporting the legislation's non-puniti ve purpose of preventing ACORN 's misuse of federal fund s is the Harshbarger Report, addressed in the Govenunent' s motion for
reconsideration. The Report sets forth nine recommendations for improvement ari sing from
numerous criti cisms of ACORN as it currently exists, but recogni'zes that reform "will not occur
II

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 12 of 17
overnight." Report at 5.5 The findings regarding ACORN's management and internal control s reinforce Congress' concern with the misuse of federal funds. Considering ACORN's organizational structure, the Report finds that "ACORN leadership at every level is thin ... the infrastructure needed to manage and oversee a sprawling federation has not been developed; and key policing mechani sms and staffing, such as a chi ef financial om~er, or independent members of boards of trustees, have not been integrated into the organization." Id. at 9-10. The Report concludes that these pervasive organizational weaknesses have been exacerbated as ACORN has evolved from an organization dedicated to community organizing to one that provides services related to taxes, food stamps, housing foreclosure, and ci tizenship appli cations, the same types of services lor whi ch plaintiffs apply for federal grants to provide. Moreover, "[t]he culture of hands-off management that was a hallmark of the ACORN organizing model is inappropriate and risky when applied to service delivery under governmental contracts and other legal and
regulatory requirements." l.!L at 15. Finally, "[t]he internal potential for fraud due to the lack of
checks and balances and oversight, is obvious ...." Id. By their .own admission, plaintiffs derive significant portions of their funding from the federal government. Given the admitted complexities of ACORN's structure Congress can reasonably regard all misusc of ACORN funds as directly rel ated to the potentially improper expenditure of federal funds.6
5 Although the Report also identifics areas wherc ACO RN has focused on reform, it finds "[t]his foc us, however, has not yet been matched by a similar attenti on to key management, human resources and field operation functions, creating vulnerabilities for the entire organi zation." RepOlt at 10. Moreover, it notes that "[p]revious professional reports demonstrate major flaws and weaknesses in all aspects of the ACORN financial and operational
systems, and the steps needed to remedy them." l.!L at 17.
6 The Harshbarger Report notes that "[t]he legal and governance structure of ACORN (the "ACORN Family") is incredibly complex, with a number of separate but interrelated
12

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 13 of 17
The Harshbarger Report, paid for by ACORN itself, concludes that ACORN has suffered through years of "serious management challenges[.]" "The hidden camera controversy is perceived by many as a third strike against ACORN on the heels ofthe disclosure in June 2008 of an embezzlement cover-up, which tri ggered the firin g of ACORN's founder,7 and the allegations of voter registration fraud during the 2008 election, done in co ll aboration with Project Vote." Report at 2. The Harshbarger Report thus confirms that Congress could reasonably have been concerned about the prospect of the misuse of publi c funds, and that the legislation challenged by plaintiffs should be seen as a desire to investigate that potential misuse, and to stop potential misuse pending that investigation, rather than as an a\tempt to impose punishment.
In short~ and at core, a temporary restriction on grants or contracts to all ow a fu ll congressiona l investigation of what appear on their face to be serious and credible allegations of fraud and abuse is not equivalent to a bar on pursuing one's profession and, given the historical meaning of legislati ve punishment, is not punishment. As the Supreme Court has repeated ly recognized, '''th[is] sanction is the mere denial ofa noncontractual governmental benefit. No affirmative disabi li ty or restraint is imposed,' and Congress has inflicted 'nothing approaching the 'infamous punishment of imprisonment' or other di sabi liti es histori call y associated with puni shment." Selective Service Sys., 468 U.S. at 853 (quoting Flemming v. Nestor, 363 U.S.
components that at one point was estimated at approximately 200 entities, but now consists of29 entities ...." Report at 6. The Report idcntifies both Plaintiff ACORN Institute and Acorn Housing Corporation (the umbrella organization for Plaintiff New York Acorn Housing Company, Inc.) as part of the "ACORN Family." Id.
7The Report was commissioned in part to "[e]val uate the management and governance reforms that ACORN's new leadership" developed "[s]i nce the termination of founder Wade Rathke following the disclosure of his ei ght~year cover-up of an embezzlemcnt by his brother, the then Chief Executive Officer of CCI." Report at I, 7.
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Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 14 of 17
603,6 17 (1960». Accordingly, thi s Court should not modify or amend its preliminary injunction to include these four additional ACORN provisions. R. Th e Court Sh ould Requi re Plaintiffs To Post A Bond Under Rule 6S{c)
If, as requested by the plainti ffs, thi s Court amends or modifi es the prel iminary inj unction issued on December 11 ,2009, plaintiffs should be required to give security for the costs that HUD (or any other agency named in the injunction) would incur in complying with the injunction. Thi s bond would be forfeited if it should later be determined that the defendants were wrongfully enj oined. Rule 65(c) provides in pertinent part:
No restraining order or preliminary injuncti on shall issue except upon the giving of security by the applicant, in such sum as the court deems proper, for the payment of such costs and damages as may be incurred or suffered by any party who is found to have been wrongfully enjoined or restrained. "The purpose of requiring security prior to issuance of an injunction or a temporary restraining order is to guarantee payment of costs and damages incurred by a pat1y who is wrongfull y enj oined or restrained." Interlink Infl Fin. Servs.. Inc. v. Blocls, 145 F. Supp. 2d 3 12, 3 14 (S. D.N. Y. 2001) (internal citation and quotations omitted). The public interest in resolving the constitutional question has to be balanced with HUD 's mi ssion to provide services to public housing residents through the HOPE VI Community and Supportive Services. See Declaration of Ronald T. Ashford, dated November 30, 2009 ("Ashford Dec!.") 'I~ 1-2 (attached as Exhibit A to Def. Opp.). Courts have required parties making challenges to government programs to provide a security where the govel11ment program would suffer losses if the injunction was later found to be wrongfull y entered. See. e.g., Maryland Dep' t ofl-Iuman Resources v. U.S. Dep ' t of Agriculture, 976 F.2d 1462, 1483 (4th Cir. 1992) {preliminary injunction regarding food stamp
14

Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 15 of 17
funds exposed Department of Agriculture to financial losses). Under the proposed modification of the preliminary injunction to include Section 4 18 of
Division of the Consolidated Appropriations Act, HUD could be requested to begin providing funds to ACORN Institute. As one example, under the terms of the ROSS agreements, HUD has stated that $558,853 .41 remain undisbursed to ACORN Institute. See Ashford Dec!. ~ 8. If an ACORN entity were to receive monies under this particular grant agreement and this Court andlor the Second Circuit were later to find that those manics had been expended unlawfully, HUD might not be able to recoup those funds so they could be expended for a lawful purpose. Thus, in keeping with the purpose ofRu1e 65(c), plaintiffs should be required to post a bond in the amount of any projected payments under ROSS grants, and under any other grants that ACORN anticipates receiving from HUD or any other agency as a result of the entry of a prel iminary injunction in this matter.8 This bond would be forfeited (i n whole or in part) upon a later determination that those payments had been unl awful.
CONCLUSION WHEREFORE, fo r good cause shown, Defendants respectfully request the Court deny Plaintiffs' Motion to Modi fy or Amend the Preliminary Injunction (Dock. No. 15) and instead grant Defendants' Motion to Reconsider or Amend its December 11 ,2009 Opinion and Order
8 If plaintiffs - who are in the best position to know from which agencies they receive federal fund s - wish to contend that they are entitl ed to injuncti ve reli ef against the heads of agencies other than those plaintiffs named in the complaint, they must move for leave to amend their complaint to add those officials as parties. See Mem. in Supp. of Defs. Mot for Recans. at 7-8. While the OMB Director is a named party, the Director does not have independent authority to direct or authorize Federal agencies to di sregard the ACORN appropriations prohibitions at issue here. Accordingly, plaintiffs cannot circumvent their obli gation to name the offi cials who are allegedly causing them prospecti ve injury by asking this Court to treat an injunction against the Di rector as an injuncti on against the entire United States government.
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Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 16 of 17

(Dock. No. II ). Dated: December 18, 2009

Respectfully Submitted,
TONY WEST Ass istant Attorney General
IAN HEATH GERSHENGORN Deputy Assistant Attorney General
BENTON J. CAMPBELL United States Attorney
F. FRANKLIN AMANAT Assistant United States Attorney
lsi Peter D. Leary PETER D. LEARY, Virginia Bar #71196 MICHAEL SITCOV, D.C. Bar # 308682 BRADLEY H. COHEN, D.C. Bar #495145 Trial Attorney U.S. Depal1ment of Justice Civil Division, Federal Programs Branch 20 Massachusetts Ave., N.W, Room 7322 P.O. Box 883 Washington, D.C. 20044 (202) 514-3313 (202) 6 16-8470 (fax) Email: Peter.Lcary@usdoj.gov
Allorneysfor the United Slates

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Case 1:09-cv-04888-NG -LB Document 21 Filed 12/18/09 Page 17 of 17
CERTIFICATE OF SERVICE I, Peter D. Leary, hereby certify under penalty of perjury that on this 18th day of December, 2009, I did cause true and correct copies of the above and foregoi ng instrument, Federal DeFendants' Response to Plaintiffs' Motion to Modify or Amend the Preliminary Injunction, to be served electronically on counsel for plaintiffs.
lsi Peter D, Leary PETER D. LEARY
U.S. Department of Justice Civ il Division, Federal Programs Branch
20 Massachusetts Ave., N. W.
P.O. Box 883 Washi ngton, D.C. 20044 (202) 514-33 J3 (202) 616-8470 (fax) Emai l: peler.learv@usdoj.gov
17

 
 Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 1 of 33

UNITED STATES DISTRICT COURT
-E-A-S-T-E-R-N--D-IS-T-R--IC-T--O-F-N-E-W--Y--O-R-K--------X
ASSOCIATION OF COMMUNITY ORGANIZATIONS FOR REFORM NOW; ACORN INSTITUTE, INC.; and MHANY MANAGEMENT, INC., flkJa NEW YORK ACORN HOUSING COMPANY, INC.,
Plaintiff.!!,
-against-

FILED
IN CLERK'S OFFICE
* * U.S. O!ST'-''''' COURT E.D.N.Y. MAR 102010
OPINION AND ORDER 09-CV-4888 (NG)

UNITED STATES OF AMERICA; SHAUN DONOVAN, Secretary of the Department of Housing and Urban Development; PETER ORSZAG, Director, Office of Management and Budget; TIMOTHY GEITHNER, Secretary of the Department of Treasury uftbe United States; LISA P. JACKSON, Administrator of the Environmental Protection Agency; GARY LOCKE, Secretary of Commerce; and ROBERT GATES, Secretary of Defense.
Defendants.
--------------------------------------------------X
GERSHON, United States District Judge:
Plaintiffs, the Association of Community Organizations for Refonn Now, Inc.
("ACORN"), aod two of its affiliates, challenge as an unconslitutional bill of attalnder a group of
appropriations provisions enacted by Congress that bar plaintiffs from receiving federal funding.
On December 11, 2009. a preliminary injunction against the enforcement of Continuing
Resolution 163, the only provision then at issue, was entered. ACORN v. United States, 662 F.
Supp. 2d 285 (E.D.N.Y. 2009) ("ACORN f'). In an amended complaln~ plalntiffs have added
I

- - --- - - ---_._-- ~-----~-

~-~-

-~--~---~---~~-- - - - - - - - - - - - - - -

Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 2 of 33
the remainder of the challenged 2010 appropriations provisions and have named as defendants the officials responsible for enforcing them. The parties have now agreed to consolidate plaintiffs' motions for preliminary and permanent relief and, in effect, both sides have moved. for
summary judgment. See Fed R. Civ. P. 56, 65. While there are minor disputes about factuoJ
matters, the parties agree that there are no material issues of fact that prevent resolution of this case without a trial.
As was noted in ACORN I. in bringing this action plaintiffs ask this court to consider the constitutionality of legislation that was approved by both houses of Congress and signed into law by the President. I again emphasize that such. task cao be approached only with the utmost gravity, because legislative decisions enjoy a high presumption of legitimacy. This is particularly true where the challenge is brought under a rarely-litigated provision of the Constitution, the Bill of Attainder Clause, which has been successfully invoked only five times in the Supreme Court since the signing of the Constitution.
ACORN's critics consider it responsible for fraud. tax evasion, and election law violations, and members of Congress have argued that precluding ACORN from federal funding is necessary to protect taxpayer money. ACORN, by contrast, while acknowledging that it has made mistakes, characterizes itself as an organization dedicated to helping the poor and argues that it has been the object of a partisan attack against its mission. 1b.is case does not involve resolution of these contrasting views. It concerns only the means Congress may use to effect its goals. Nor does this case depend upon whether Congress has the right to protect the public treasury from fraud, waste, and abuse; it unquestionably does. The question here is only whether Congress has effectuated its goals by legislatively determining ACORN's guilt and imposing punislunent on ACORN in violation of the Constitution's Bill of Attainder CJause.
2

Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 3 of 33
BACKGROUND ACORN describes itself as "the nation' s largest community organization of low-andmoderate income families." ACORN. in addition to its O\VJl work, has affiliations with a number
, of other organizations, including its co-plaintiffs ACORN Institute, Inc. and MHANY Managemen~ Inc., which was formerly known as New York ACORN Housing Company, Inc. Plaintiffs have in past years received millions of dollars in federal ftmding from a variety of grants, embodied in contractual agreements, from various federa1 agencies. ACORN itself does not receive federru grants, but it has been a frequent subcontractor of ACORN affiliates such as ACORN Institute.
Numerous accusations have been made against ACORN. M ost prominently, ACORN came tmder attack after publication of hidden-camera videos in September of 2009, in which employees of an ACORN affiliate are seen to advise a purported prostitute and her hoyfriend about how to engage in various illegal activities and evade law enforcement while doing so. Other allegations include that ACORN violated tax laws governing non-profit 'organizations. misused taxpayer dollars, committed voter fraud, and violated federal election laws by playing an impennissibly partisan role in its voter registration campaign. ACORN has been and is currently the subject- of numerous investigations,· ACORN answers that it has responded by tenninating staff members found to have engaged in misconduct, reorganizing its board of directors, and hiring Scott Harshbarger, Esq., a former Massachusetts Attorney General, to conduct an internal investigation. Both sides rely on Mr. Harshbarger's report, issued on December 7, 2009, which identifies problems with ACORN's internal management, discusses
The Congressional Research .Service has prepared a list of all pending and previous investigations relating to ACORN. See Memorandum from Congressional Research Service to House Judiciary Committee re: Association of Community Organizations for Refonn Now (Dec. 22,2009).
3

Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 4 of 33
refonns already being undertaken, and suggests others; it also raises issues regarding the integrity of the videotapes.
In the fall of 2009, in the absence of 2010 appropriations acts for all federal agencies and programs, Congress enacted, and President Obama signed into law, a Continuing Appropriations Resolution ("Continuing Resolution"). That Continuing Resolution included one of the provisions at issue in this case, referred to here as "Section 163," which was the subject of ACORN 1. Continuing Appropriations Resolution, 2010, Pub. L. No. 111-68, Diy. B, § 163, 123 Stat. 2023, 2053 (2009). Section 163 provides that:
None of the funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now (ACORN), or any of its affiliates, subsidiaries, or allied organizations. The Continuing Resolution containing Section 163 went into effect on October 1,2009, and was extended on October 31, 2009 to December 18, 2009. Further Continuing Appropriations Resolution, 2010, Pub. L. No. 111-88, Diy. B, § 101, 123 Stat. 2904, 2972 (2009). The extension of the Continuing Resolution was included in the same law as the 2010 appropriations act for the "Department of the Interior, Environment, and Related AgenCies." Another division of this Act prohibits federal funds from being "made available" under the Act to ACORN or "its subsidiaries." Dep't of the Interior, Environment and Related Agencies Appropriations Ac~ 2010, Pub. L. No. 111-88, Diy. A, § 427,123 Stat. 2904, 2962 (2009). On October 7, 2009, Peter Orszag, the Director of the Office of Management and Budget ("OMB") and a defendant here, issued a memorandum to the heads of all executive branch agencies regarding the implementation of Section 163 ("OMB Memorandum"). The OMB Memorandum directs, inter alia, that "[n]o agency or department should obligate or award any Federal funds to ACORN or any of its affiliates, subsidiaries or allied organizations (collectively
4

Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 5 of 33
'affiliates') during the period of the [Continuing Resolution]," even where the agencies had already detennined that funds should he awarded to ACORN, but had not yet entered into binding agreements with the organization to do so. TIlls prohibition applied not just to the 2010 fiscal year, but also to appropriations made in Fiscal Year 2009, and to any funds left over from prior years' appropriations. In addition, the OMB Memorandum states that agencies should, "where pcnnissible/' suspend performance and payment under existing contracts with ACORN and its affiliates, and ask for guidance on any legal considerations from the agencies' own counsel. OMB, or the Department of Justice. Finally, turning to subcontractors, the OMB Memorandwn instructs agencies to "take steps' so that no Federal funds are awarded or obligated by your grantees or contractors to ACORN or its affiliates" and recommends that each agency notify federal grant and contract recipients about Section 163. On November 19, 2009, HUD gave notice to plaintiff ACORN Institute that it was suspending several of its contracts with the organization because of Section 163.
Plaintiffs filed suit in this court on November 12,2009, arguing that Section 163 is an unconstitutional bill of attainder and that it violates their rights under both the First Amendment and the Due Process Clause. In their initial complaint, plaintiffs alleged that, as a direct consequence of Section 163, agencies have refused to review their grant applications; that grants
they were told they would receive have been rescinded; that previously-awarded grants have not been renewed; and that HUD had refused to pay on its contractual obligations even for work already performed, Plaintiffs also alleged that other organizations. such as private corporations
and fOW1dations, have cut ties to them as a result of Section 163, Following the dissemination of the OMB Memorandum, the Department of Justice Office
of Legal Counsel ("OLC") responded to a request for guidance from HUD as to whether Section 163 prohibits payments to ACORN to satisfy contractual obligations that arose prior to Section
5

Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 6 of 33
163's enactment' The OLC memorandum advises HUD that "[SJeetion 163 should not be read as directing or authorizing HUD to breach a pre-existing binding contractual obligation to make payments to ACORN or its affiliates, subsidiaries, or allied organizations where doing so would give rise to contractual liability," To read. Section 163 otherwise, the memorandum notes, would
"undo a binding governmental contractual promise." The memorandum explains that its
construction of Section 163 not only avoids abrogating «binding governmental contractual promises," but also avoids constitutional concerns, in particular those arising from the Bill of Attainder Clause, that "may be presented by reading the statute, which applies to specific named
entities, to abrogate such contracts, including even in cases where perfonnance has already been
eompleted but payment has not been rendered." Plaintiffs sought emergency relief on November 13,2009, arguing that Section 163 was
an uneonstirutional bill of attainder and that it violated their rights under both the First Amendment and the Due Process Clause. On December II, 2009, I preliminarily enjoined thendefendants the United States, Peter Orszag, in his official role as Director of OMB, Shaun Donovan. in his official role as Secretary of HUD, and Timothy Gcithner. in his official role as Secretary of the Treasury, from enforcing the provision, on the grounds that plaintiffs had shown
irreparable hann and a likelihood of success on the merits of their claim that Section 163 is a bill
of attainder.' ACORN I, 662 F. Supp. 2d at 299-300.

2

Although the OLC memorandum is dated October 23, 2009, it was not publicly released

until 1.,. November 2009.
, The government appealed that decision on December 16, 2009, but has not moved in the

Second Circuit to expedite the appeal. By letter dated February 12, 2010, the government asked

for a due date of May 13,2010 for its opening brief in the Court of Appeals, which request was

"so ordered" on February 17, 2010.

6

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Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 7 of 33

On December 16, 2009, President Obama signed into law the 2010 Consolidated Appropriations Act. Consolideted Appropriations Act, 2010, Pub. L. No. 111-117, 123 Stat. 3034 (2009). This Act, described by the government as a "minibus" Act, is a consolidation of various appropriations acts for Fiscal Year 2010.
Several of the consolidated acts contain provisions prohibiting the award of funding to ACORN.' Section 418 of Division A of the Act, wbich appropriates funding for "Transportation, Housing and Urban Developmellt, and Related Agencies," precludes federal
funding to ACORN in language identical to that of Section 163. See Transportation, Housing,
and Urban Development, and Related Agencies Appropriations Act, 2010, Pub. L. No. 111-117, Div. A, § 418, 123 Stat. 3034, 3112 (2009).' Section 534 of Division B of the Act, which covers appropriations for "Commerce, Justice, Science, and Related Agencies," provides that "[nJone of the funds made avallable under this Act may be distributed to the Association of Community
Organizations for Reform Now (ACORN) or its subsidiaries." Commerce, Justice, Science, and Related Agencies Appropriations Act, 2010, Pub. L. No. 111-117, Div. B, § 534, 123 Stat. 3034,
3157 (2009). Section 511 of the "Military Construction and Veterans Affairs and Related Agencies"
appropriations act provides that "[nJone of the funds made available in this division or any other division in this Act may be distributed to [ACORN] or its subsidiaries." Military Cons1ruction

•

The government has identified three Fiscal Year 2010 appropriations acts passed shortly

after Section 163 that do not include a ban on funding ACORN. See Agriculture, Rural

Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010,

Pub. L. No. 111-80, 123 Stat. 2090 (2009); Department of Homeland Security Appropriations

Act, 2010, Pub. L. No. 111-83, 123 Stat.'2142 (2009); Energy and Water Development and

Related Agencies Appropriations Act, 2010, Pub. L. No. 111-85,123 Stat. 2845 (2009).

,

The parties agree that Section 418's "prior Act" language bars funding of ACORN from

HUD funds left over from prior years' appropriations, but disagree as to whether that language

extends to other agencies' funds from prior years. Plaintiffs and the government agree that this

dispute need not be resolved to decide this case.

7

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and Veterans Affairs and Related Agencies Appropriations Act, 2010, Pub. L. No. 111-117, Div. E, § 511, 123 Stat. 3034, 3311 (2009). In contrast to the other provisions in the minibus, which limit the funding prohibitions to one single division. the funding restriction in Division E applies to the entirety of the minibus, except insofar as it may conflict with other ACORN-related provisions within another division.
Following the enactment of the minibus bill, Congress passed and the Pl't:sident signed into law the final outstanding appropriations bill, the Department of Defense Appropriations Act of 2010, which prohibits distribution of funds under the act to ACORN or "its subsidiaries." Department of Defense Appropriations Act, Pub. L. No. 111-118, § 8123, 123 Stat. 3409, 3458 (2009). Once this flnal appropriations act was passed, the Continuing Resolution, and thus Section 163 included in it, expired.
On consent of the govenunent, plaintiffs filed a second amended complaint including all flve Fiscal Year 2010 appropriations provisions that prohibit funding to ACORN as well as Section 163.' Plaintiffs named three new defendants: Lisa P. Jackson, Administrator of the Environmental Protection Agency C'EPA); Gary Locke, Secretary of Commerce: and Robert Gates, Secretary of Defense.
Plaintiffs and defendants agree that, for the pUlJloses of the bill of attainder argnrnent, the challenged provisions should be analyzed as one statute. Although several of the full year appropriations acts use language slightly different from that of Section 163, neither plaintiffs nor defendants have suggested that any of these differences is significant, either practically or legally. Similarly, although the challenged provisions differ somewhat in whether they prohibit
, Following the enactment of the 2010 appropriations acts, plaintiffs had amended their initial complaint to include challenges to these acts, and they moved to "Amend/Correct/Supplement" the preliminary injunction issued in ACORN I. This motion was
denied on procedural grounds, after which plaintiffs, on consent. filed the second amended complaint now at issue.
8

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funding to "ACORN or its subsidiaries"·or "ACORN, or any of its affiliates, subsidiaries, or allied organizations," at least for plaintiffs' bilJ of attainder argument, any difference between these teons is immaterial. For purposes of simplicity, I refer to the group as "ACORN and its affiliates."
Plaintiffs acknowledge that HUD, pursuant to the OLC memorandum, has paid, or has agreed to pay, for work already performed under existing contracts. They contend that congressional suspension of existing contracts and the denial of the opportunity to obtain future contracts amounts to punishment that violates the Bill of Attainder Clause.
The defendants recognize that ACORN has been singled out by Congress and that there has been no judicial trial at which ACORN has been found guilty and deserving of punishmen~ but argue that the challenged legislation is not a bill of attainder because it does not impose punishment The government relies heavily on Section S3S of Division B of the 2010 Consolidated Appropriations Ac~ which directs the United States Government Accountability Office ("GAO") to "conduct a review aod audit of the Federal funds received by [ACORN] or any subsidiary or affiliate of ACORN" to detennine
(I) whether any Federal funds were misused and, if so, the total amount of Federal funds involved and how such funds were misused; (2) what steps, if any, have been taken to recover any Federal funds that were misused; (3) what steps should be taken to prevent the misuse of any Federal funds; and (4) whether all necessary steps have been taken to prevent the misuse of any Federal funds. Commerce, Justice, Science, and Related Agencies Appropriations Act, 2010, Pub. L. No. 111-
117, Div. B, § 535, 123 Stat. 3034, 3157-58 (2009). Section 535 directs that within 180 days of
enactment of the Act, the Comptroller General "shall submit to Congress a report on the results
of the audit . .. ,along with recommendations for Federal agency reforms." Id Plaintiffs do not
challenge the Section 535 provision as a bill of attainder. but the government relies on the
9

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investigation to argue that Congress had a non-punitive reason for passing the challenged provisions.
DISCUSSION L Bill of Attainder Analysis
Article I, Section 9, of the Constitution provides that "No Bill of Attainder or ex post facto Law shall be passed."' A bill of attainder is "a law that legislatively detemrines guilt and
inflicts punislunent upon an identifiable individual without provision of the protections of a judicial trial," Nixon v, Adm'r oJGen, Servs., 433 U.S, 425, 468 (1977), Enacted as a "bulwark against tyranny" by Congress, "the Bill of Attainder Clause was intended not as a narrow,
technical (and therefore soon to be outmoded) prohibition, but rather as an implementation of the separation of powers, a general safeguard agains~ legislative exercise of the judicial function, or more simply-trial by legislature." United States v, Brown, 381 U,S. 437, 443, 442 (1965). This principle of separation of powers animates bill of attainder jurisprudence; its prohibition "reflected the Framers' belief that the Legislative Brancb is not so well suited as politically independent judges and juries to the task of ruling upon the blameworthiness of, and levying appropriate punishment upon, specific persons." Id. at 445.8
Three factors "guide a court's determination of whether a statute directed at a named or readily identifiable party is punitive": flrs~ "whether the challenged statute falls within the historical meaning of legislative punishment"; second. "whether the stattne. viewed in tenns of

7 The Constitution includes two clauses PTohibiting bills of attainder. Article [, Section 9, implicated here, restricts Congress; Article I, Section 10, restricts state legislatures.

8

As the government acknowledges, the Second Circuit has detennined that the Bill of

Attainder Clauses protect corporations as well as individuals. See Consolo Edison Co. ofNY. v.

Palaki, 292 F.3d 338, 346-47 (2d Cir. 2002). Defendants have reserved the right to cballenge

the applicability of the Bill of Attainder Clause to corporations in any appellate proceedings in

this case,

10

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the type and severity of burdens imposed, reasonably can be said to further nonpunitive legislative purposes," an inquiry sometimes referred to as the "functional test"; and third, "whether the legislative record evinces a legislative intent to punish." Consolo Edison Co. of N.Y., Inc. v. Palaki ("Can U'), 292 F.3d 338, 350 (2d Cir. 2002) (internal quotation marks and altemtions omitted). A statute "need not fit all three factors to be considered a bill of attainder;
rather, those factors are the evidence that is weighed together in resolving a bill of attainder claim." fd.
A. Historical Meaning ofLegislative Punishment As the S=nd Circuit bas explained, "[sJome types oflegislatively imposed ham> ... are
considered to be punitive per se." Can Ed, 292 F.3d at 351. "The classic example is death, but others include imprisorunent, banislunent, . . . the punitive confiscation of property, and prohibition of designated individuals or groups from participation in specified employments Dr vocations." ld. (internal quotation marks and alterations omitted).9
Any consideration of the "historical" meaning of punishment in this context must begin with the handful of Supreme Court caseS finding statutes to be bills of attainder. In each of the five cases in which the Supreme Court has found legislation to violate the Bill of Attainder Clause, the context of the Court's ruling was protection ofpoliticalliberty.10 In Cummings)/. Missouri, 7I U.S. (4 Wall.) 277 (1866), for example, the Court concluded that a statute that barred persons from certain professions unless they took an oath that they had never been connected to an organization "inimical to the government of the United States" was punishment

9

The history of the bill of attainder, and its roots in fourteenth-century England, have been

described elsewhere. See, e.g., Brown, 3&1 U.S. at 441-49; In re Extradllion of McMullen, 989

F.2d 603, 604-06 (2d Cir. 1993).

10 Here, plaintiffs allege that ACORN bas been punished both for alleged misconduct, such as fraud, and its alleged impetmissible partisanship.
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for past association with tho Confederacy. Accord Ex parte Garland. 71 U.S. (4 Wall.) 333
(1866); Pierce v. Carskadon. 83 U.S. (16 WaIJ.) 234 (1872). Similarly. in United Stales v. Brown. 381 U.S. 437 (1965). the Court held that a statute making it a crime for a member of the Communist Party to serve as an officer or emp!.oyee of a labor uirion was a bill of attainder. In the' fifth case. United States v. Lovett. 328 U.S. 303 (1946). the Court held that a statute that permanently barred three government employees who had been accused of being communists from govenunent service was an unconstitutional bill of attainder.
As acknowledged in ACORN I. the idea that the deprivation of the opportunity to apply
for discretionary federal funds is "punitive" within the meaning of the Bill of Attainder Clause at
first blush seems implausible. Neither the Supreme Court nor the Second Circuit has been raced with such a claim. This is not surprising: Plaintiffs assert, and defendants do not dispute. that this is the first time Congress has denied federal funding to a specifically named person or organization in this way. One district court, however, in a case much like this one, has concluded that denial of the opportunity to apply for stale government contracts amounts to punishment under Article I, Section 10. See Fla. Youth Conservation Corps., Inc. v. Stutler, No. 06-275.2006 WL 1835967. at '2 (N.D. FIlL June 30. 2006). For the reasons explained below. I agree vrith the district comt in Florida and conclude that the discretionary nature of goverrunental funding does not foreclose a finding that Congress has impermissibly singled out plaintiffs for
punishment.
Lovett is particularly instructive in this regard. In Lovett, a congressman attacked thirtynine specifically named government employees, including plaintiffs. as "irresponsible, unrepresentative, crackpot, radical bureaucrats," and affiliates of "communist front
organizations." Lovell, 328 U.S. at 308-09. Following secret hearings, Congress passed an act
12

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that no appropriation could then, or later, be used to pay plaintiffs' government salaries. Id at 312-13.
The Supreme Court concluded that the appropriations act "clearly accomplishes the punishment of named individuals without a judicial trial." Id. at 316. That Congress placed the prohibition in an appropriations bill canied no weight. "The fact that the punishment is inflicted through the ins trumentality of an Act specifically cutting off the pay of certain named individuals found guilty of disloyalty," the Court concluded, "makes it no less galling or effective than if it
had been done by an Act which designated the conduct as criminal." Id. The government attempts to distinguish Lovett on the ground that plaintiffs in that case
had a "vested property interest" in their jobs, whereas here, as plaintiffs unequivocally acknowledge, they have no right to the award of 8 grant or contract from the federal government. But the Court in Lovetl did not base its decision on a property rights analysis. The Supreme Court found a deprivation amounting to punishment under the Bill of Attainder Clause, not only because plaintiffs were deprived of their earned income from existing government jobs, but also because they were deprived of any future opportunity to serve the government As the Court stated, "[tlhis permanent proscription from any opportunity to serve the Govemmeot is
punishment, and of a most severe type." ld. That plaintiffs had no right to any particular future job was of no moment. 1l
The government relies on two Supreme Court cases to argue that the denial of the
opportunity to apply for federal funding cannot be punishment. In Flemming v. Neslor, 363 U.S.
603 (1960), the plaintiff argued that a statute denying Social Security benefits to a category of
\I The govenunent also argues that in Lovett the ban on plaintiffs' government employment was permanent, and that it was the pennanency of the legislative action that made the statute unconstitutional. But. as I address at Jength below, the year-long duration of the ban does Dot foreclose a bill of attainder finding, particularly given that even a short deprivation of the
opportunity to apply for or receive federal funding has long-term ramifications for plaintiffs. 13

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deported aliens was a bill of attainder. The Supreme Court disagreed, describing the deprivation

as the "mere denial of a noncontractual govermnent benefit" and fmding no punitive intent in the

design of the statute. Id at 617. The government also points to Selective Service System v.

Minnesota Public Interest Research Group ("Selective Servtce"), 468 U.S. 841, 853 (1984),

""ere the Court concluded that a starute barring persons who had not registered for the draft

from federal student aid did not constitute punishment.

This case is closer to Lovett than to Flemming or Selective Service. The Supreme Court

in both Flemming and Selective Service fOl.Uld the statutes at issue to be nonpunitive. In

Flemming, the Court concluded that the legislative record "falls short of any persuasive showing

that Congress was in fact concerned alone with the grounds of deportation," which, in the

plaiotiff's case, was prior membership in the Communist party. Flemming, 363 U.S. at 619. In

Selective Service, the Court reasoned that the statute had the valid goal of encouraging a class of

persons to do what they were already legally obligated to do - register for the draft. See

Selective Service. 468 U.S. at 860. As discussed further below, I cannot discern any valid, non-

ptmitive purpose for Congress enacting the legislation challenged in this case. Further, unlike

the plaintiffs affected by the statute at issue in Selective Service, plaintiffs here cannot avoid the

restrictions imposed upon them. Nothing in the challenged provisions affords plaintiffs an

ban. opportunity to overcome the funding

Cf SBC Cammc '1lS. Inc. v. FCC, 154 F.3d 226, 243

(5th Cir. 1998) (upholding against a bill of anaioder challenge a statute that sought to encourage

competition in the telecommunications industry by imposing restrictions on a specific group of

companies because. inter alia, the companies "[would] be allowed to enter each oftbe affected

areas as soon as the statutory criteria regarding competition in their local service markets are

met.").

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Notably, in neither Flemming nor Selective Service did Congress single out any particular . individual or entity for adverse treatment; rather, each statute applied to an entire category of people. Here, in contrast, the congressional deprivation is imposed only on ACORN and its
affiliates. See Flemming, 363 U.S. at 619 (reasoning that, even if the legislative history were read "as evidencing Congress' COncern with the grotulds [of prior Communist party membership), rather than the fact, of deportation," "[t)lUs would still be a far cry from the situations involved in [prior Supreme Court cases] where the legislation was on its face aimed at particular individuals"); Nixon, 433 U.s. at 485 (Stevens, J. concurring) (stating that "[i)t has been held permissible for Congress to deprive Communist deportees, as a group, of their social security benefits, but it would surely be a bill of attainder for Congress to deprive a single, named individual of the same benefit ... The very specificity would mark it as punishment, for there is rarely any valid reason for such narrow legislation[.]").
Accordingly, a close reading of the cases indicates that a deprivation of the opportunity to apply for funding in fact fits comfortably within the definition of "punishment" for bill of attainder purposes.
B. The Functional Test I next consider whether the challenged provisions further non·punitive legislative
purposes in light of the type and severity of the burdens they impose.
The Court of Appeals for the Second Circuit explored this factor at length in
Consolidated Edison ofNew York, Inc. v. Fataki, in which the Court concluded that an act of the New York state legislature constituted an unconstitutional bill of attainder under Aniele I, Section 10 of the Constitution. 292 F.3d at 345. Based on a finding that Consolidated Edison ("Con Ed") had "failed to exercise reasonable care on behalf of the health, safety and economic
interests of its customers," when it failed to promptly replace steam generators it knew to be
15

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... . .._. - - --- - -

Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 16 of 33

. faulty, and which then failed, the New York legislature passed a law forbidding Con Ed from passing along the costs associated with the outage to the ratepayers. Id. at 344-45.
The Second Circuit found that the State bad no valid non-punitive reason that justified singling out Con Ed. It rejected the State's argwnent that the statute had the legitimate nOD-
punitive purpose of preventing innocent ratepayers from paying for Con Ed's mistakes. The statute, the Court concluded, did more than simply re-distribute or minimize costs. Rather, the
"type and severity of the burdens imposed" belied the legitimacy of the regulatory justification.
Id. at 353. There was little question that Con Ed could have passed on the cost of obtaining power elsewhere if it bad replaced the generators during a scheduled outage; "[w]bat then," the Court asked, "other than punislunent ~ justify forcing Con Ed to absorb these same costs after the accidental outage?" Id Further, the legislature could have enacted "less burdensome
alternatives" to achieve its legitimate objectives. such as excluding "those substantial costs that wou1d have been incurred absent misconduct on Con Ed~s part." Id at 354.
In attempting to articulate a non-punitive rationale for the challenged provisions, the government now presses the same non-punitive justifications as it did in ACORN 1. The goverrunent again argues that, because there was no formal congressional finding of misconduct against ACORN, the year-long bar on all funding to ACORN is not punitive. But, as in Con Ed, the nature ofthe bar and the context within which it occurred make it unmistakable that Congress detennined ACORN's guilt before defunding it. See Nixon, 433 U.S. at 480 (noting that a "fonnal legislative announcement of moral blameworthiness or punisbment" is not a necessary element of a bill of attainder). In sum, wholly apart from the vociferous conunents by various members of Congress as to ACORN's crirnIDality and fraud, .as described below, no reasonable observer could suppose that such severe action would have been taken in the absence of a conclusion that misconduct had occurred. See Con Ed, 292 F.3d at 349 (noting that "[alnother
16

Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 17 of 33
indispensible element of a bill of attainder is its retrospective focus: it defines past conduct as wrongdoing and then imposes punishment on that past conduct.").
The government also argues that Congress withheld funds from plaintiffs for the non· punitive reason of protecting ..the public fisc:' not to penalize ACORN for past wrongdoing. But Congress's interest in preventing foture misconduct does not render the statute regulatory mther than punitive. Deterring future misconduct, as Con Ed stressed, is a traditional justification of purushment See Con Ed, 292 F.3d at 353; see also Brown, 381 U.S. at 458; Selective Service, 468 U.S. at 851-52 ("PWlishment is not limited solely to retribution for past events, but may involve deprivations inflicted to deter future misconduct."). Incapacitation~ too, is often a reason for punishment But cf SeaRiYer Maritime Fin. Holdings, Inc. v. Minena, 309 F.3d 662 (9th Cir. 2002) (upholding a statute restricting "tank vessels that have spilled more than 1,000,000 gallons of oil into the marine environment" from operating in Prince William Sound against a bill of attainder challenge because the statute had a non-purutive purpose.).
Turning to consideration of the "type and severity" of the burdens the challenged provisions. impose, the govenunent argues that the appropriations provisions, unlike the "permanent" ban on funding in Lovetl, are only <Itemporary." But the year-long duration of the ban does not foreclose a bill of attainder finding. As a preliminary matter, it is far from settled that punishment must be a permanent measure. See Brown, 381 U.S. at 447 (noting that the Bill of Attainder clause bars legislative punishment "of any fonn or severity"). If Congress detennined that a person was to be jailed for a year and then released, the government would be
hard pressed to argue that on1y a life sentence would constitute "punishment.,,12
12 The government's argument also ignores the fact that appropriations acts. even if renewed indefinitely. are by their very nature limited in time; if plaintiffs are precluded from challenging a funding restriction on the basis of the ''temporariness'' of a year-long appropriations provision. plaintiffs could never challenge a ban in an appropriations bill that was
17

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And, contrary to the government's contention, the challenged provisions are no less permanent than the statute at issue in Con Ed. The New York legislature deprived Con Ed of the opportunity to recover the costs of its outage through a one-time rate increase, but Con Ed was not precluded from recovering costs ofJuture outages from ratepayers. In the same way, the han on ACORN may last only one year, but ACORN is permanently deprived of the opportunity to apply for Fiscal Year 2010 funding. This may affect multi-year grants and contracts (although such grants and contracts may be contingent on congressional appropriations in another fiscal year). In addition, the backward-looking provision in the HUD appropriations act, imposing limits on funding ACORN out of available appropriations from prior acts, also extends the impact beyond a single appropriations year. See supra note 5. Most importantly, although the government's briefrefers to the limitations as "temporary," as "suspensions of funding," and as a "moratorhun" on funding, plaintiffs are pennanently harmed now even if their opportunity to
apply for federal funding is restored in the future.
One difference between Section 163 and the newly-challenged provisions features prominently in one of the government's proffered non-punitive rationales: the inclusion in Section 535 of a directive to GAO to investigate grants to ACORN. Citing this investigation, the government argues that the challenged provisions "further the non-punitive legislative purposes of investigating the possible misuse of federal funds and exercising oversight of executive branch agencies' expenditure of funds." Gov't's Mem. in Opp. to PIs.' Motion for Penn. Relief 15. The government points to the investigation as evidence that Congress's rationale in enacting
renewed indefinitely. Such a situation would raise difficulties akin to those controversies the Supreme Court has found "capable of repetition; yet evading review" in the mootness context.
See, e.g.• Davin. Fed. Election Comm 'n, 128 S. Ct. 2759, 2769-70 (2008).
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these various provisions was not to punish plaintiffs, but rather to learn about their activities to be able to detennine whether to fund them in the 2011 appropriations year.
This argument rests on the faulty assumption that Congress can constitutionally rely on the results of a congressional investigation to single plaintiffs out and to deny them funding. Congress is entitled to investigate ACORN and to determine whether the executive agencies with whom plaintiffs have contracted have properly held them to account. But Congress could not rely on the negative results of a congressional or executive report as a rationale to impose a broad, punitive ftmding ban on a specific, named organization; explicit non·judicial findings of guilt would exacerbate, rather than mitigate, the pwIitive nature of the challenged provisions. See De Veau v. Braisted, 363 U.S. 144, 160 (1960) ("The distinguishing feature of a bill of attainder is the substitution of a legislative for a judicial determination of guilt"), The same is true for the variety of investigations of ACORN the government relies on to j ustify Congress's action. Similarly, legislative detenrunations of plaintiffs' wrongdoing did not save the statutes in Loven or Con Ed.
In any event, the inclusion of a direction to the GAO to investigate does not support the plausibility of the government's rationale. To the extent the government argues that the investigation evidences Congress's non·punitive pwpose of investigating the possible misuse of federal funds, nothing in the challenged legislation, or in Section 535, indicates that the investigation ordered by Congress is linked to the bans on funding in the way that government counsel suggests. Nor does anything in the legislative record support this rationale; the goverrun~nt has cited no legislator who articulated itj 13 and in fact, the proponent of the
13 The government notes that two members of the House, Representative Lamar Smith and
Representative Darrell Issa, wrote a letter to the GAO requesting an investigation into ACORN ' s use of federal funds, as did twenty senators. See, e.g., Letter from Congressmen Smith and Issa
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investigation, Senator Richard Durbin, argued against the funding prohibitions, 14 Funher, as
noted previously, the unavailability of any means for ACORN to overcome the funding ban if the
investigation report is favorable underscores the lack of a connection between the burdens of the
statute and Congress's purpose in enacting it.
Moreover. the govenunent ignores the .existence of comprehensive regulations
promulgated to address the very concerns Congress has expressed about ACORN. For example,
the Code of Federa! Regulations establishes a fonnal process for determining when federal
contractors can be suspended or debarred. See, e.g., 2 C.F.R Ch. 1, Part 180. Subpart G of this
part provides that a suspending official may impose suspension after considering a range of
to The Honorable Gene Dndaro, Acting Comptroller General (Sept. 23, 2009); Lener from
Twenty Senators to Acting Comptroller General Dodaro (Sept 22, 2009). But. as plaintiffs point out, Representatives Smith and lssa wrote their letter only after
they had voted to prohibit ACORN from receiving federal funds on 8 permanent basis. See Defund ACORN Act, H.R. 3571, lllth Congress (passed in the House September 17,2009). Moreover, several of the senators requesting an investigation had previously introduced Senate Bill 1687, the Protect Taxpayers from ACORN Act, sponsored by Senalor Mike Johanns, which would also have permanently prohibited ACORN and ACORN affiliates from receiving any federa! funding. And, indeed, the same members of Congress voted for the funding prohibition in the Department of Interior's appropriations act before they knew whether the GAO would investigate at all.
14 In proposing the investigation, Senator Durbin stated that "[WJe are seeing in Congress
an effort to punish ACORN that goes beyond any experience [ can recall in the time [ have been
on Capitol Hill. We bave put ourselves - with some of the pending amendments - in the position of prosecutor, judge andjury." 155 Cong. Rec. 810181, S10211 (dailyed. Oct. 7,2009). He continued:
Mr. President, I went to one of these old·fashioned law schools. We believed that first you have the trial, then you have the hanging. But, unfortunately, when it comes to this organization, there has been a summary execution order issued before the trial. I
think that is wrong. In America, you have a trial before a hanging,
no matter how guilty the party may ' appear, And you don't necessarily. penalize an entire organization because of the sins or crimes of a limited number of employees. First, we should find out the facts. Id.
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factors; the official can even take "immediate action" if "needed to protect the public interest." See 2 C.F.R. § 180.705 ("In deciding whether immediate action is needed to protect the public
interest, the suspending official has wide discretion ... .'1. By DOling these regulations, 1 do not
suggest that Congress is precluded from exercising its oversight powers if it is concerned that agencies are not adequateJy implementing their authority. But the existence of these regulations militates against the need for draconian, emergency action by Congress.
That ACORN alone was singled out for adverse treatment further belie's any claim that non-punitive reasons explain the challenged provisions. It is true that not every statute directed at a single individual or entity will necessarily be a bill of attainder. In Nixon, for example, the Supreme Court found that a statute naming former President Nixon was not a bill of attainder. . The s~cific mention of rus name was "easily explained by the fact that at the time of the Act's passage, only his [papers and recordings] demanded immediate attention." 433 U.S..at 472. Nixon, and only Nixon, had entered into an agreement with a depository which called for destruction of the materials upon Nixon's death. Thus, Nixon "constituted a legitimate class of one, and this provide[d] a basis for Congress' decision ID proceed with dispatch with respect ID his materials while accepting the status of his predecessors' papers and ordering the further consideration of generalized standards to govern his successors." Id.
Similarly, the D.C. Circuit in BellSouth Corp. v. FCC, 162 F.3d 679 (D.C. Cir. 1998),
held that a statute that specifically restricted the operations of the Bell Operating Companies
("BOCs'1 in order to promote competition in the telecommunications market was not a bill of attainder because of the "unique infrastructure controlled by the BOCs" which allowed them to exercise monopoly power. Because of this "unique infrastructure," the D.C. Circuit concluded that the differential treatment was ''neither suggestive of punitive purpose nor particularly suspicious." ld at 689-90 (internal quotation marks omitted). The Fifth Circuit, addressing
21

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another challenge to the same legislation, similarly stated that the "[BOC~] can exercise
bottleneck control over both ends of a [long distance] telephone call in a higher fraction of cases"
than other com~es. and that it was therefore ''rational to subject them to additional burdens in order to achieve the overall goal of competitive local and long distance service." See SSC Commc'ns Inc_, 154 F.3d at 243.
The government has offered no similarly unique reason to treat ACORN differently from other contractors accused of serious misconduct and to bar ACORN. from federal funding without either a judicial trial or the administrative process applicable to all other government contractors. In Con Ed, the Second Circuit established a rigorous standard for evaluating legislatures' purported justifications in the bill of attainder context. New York State argued numerous seemingly non-punitive reasons for the legislation in question. including deterrence
and protection of public safety. The Circuit examined each rationale closely and systematically, and it found each one lacking a nonMpunitive purpose. As in Con Ed, no~e of the government's justifications stand up to scrutiny. I can discern no nODMpunitive mtionrue for a congressional baa on plaintiffs, aad plaintiffs alone, from federal funding_
C. Legislative History
The third. and final. element in determining whether an act is punitive is legislative intent. See Selective Service, 468 U.S. at 852. 'The legislative record by itself is insufficient evidence for classifying a statute as a bill of attainder unless the record reflects overwhelmingly
a clear legislative intent to punish." Con Ed. 292 F.3d at 354. Determining Congress's intent is
often a difficult exercise; the stated comroents of one legislator do not necessarily represent the lll1Spoken thoughts of others who voted for a bill. Nevertheless, since the Supreme Court instructs that legislative intent is a key part of the framework for detennining whether a legislative act is a bill of attainder, I must consider it. See Nb:on. 433 U.S. at 478.
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Here, the task is made easier because the government fails to offer any legislative history that would indicate a non-punitive intent In ACORN I, in justifying Section 163, the government relied on the statements of Senator Mike Johanns, who introduced all of the challenged provisions in this case. For example, the government cited Senator Johanns's statement, in support of the provision defunding ACORN in the 2010 Department of Interior's appropriations act, that he was proposing the legislation "to defend taxpayers against waste, fraud, and abuse." ISS Cong. Rec. S9517 (daily ed. Sept. 17,2009). The government also relied on Senator Johanns's statement that ACORN was "in an absolute free fall when it comes to allegations of illegal activity" and was "besieged by allegations of fraud and corruption and employee wrongdoing." ld Such statements require an implicit finding of wrongdoing by plaintiffsj protection of taxpayers' money is a logical justification for a funding ban only if wrongdoing is assumed. IS
When introducing the challenged 2010 appropriations provisions, Senator Johanns made it clear that the purpose of the new provisions was to continue the prohibition enacted in Section 163. He explained that, because the Continuing Resolution was about to expire, Congress "need[s] to continue passing this amendment; therefore, [he] need[s] to continue to offer it."
Senator Johanns also noted that he "doCes1have a piece of legislation pending that would take
care of this across the Federal system, but that has not come to a vote yet. So I am offering today this amendment on ACORN. This amendment will continue to protect taxpayer dollars." 155
IS At least one representative, Representative Rush Holt, voiced his concern that Section
163 was a bill of attainder. See 115 Congo Rec. H9975 (dailyed. Sept. 25, 2009). In his comments, Rep. Holt referenced a report from the Congressional Research Service. 'This report, which was written regarding a different bill, "the Defund ACORN Act," which has not been enacted, analyzed that bill and concluded that "a court would have a sufficient basis to overcome the presumption of constitutionality and find that the Defund ACORN Act viol.tes the prohibition against bills of attainder." Kenneth Thomas, Congressional Research Service Report for Congress; The Proposed "Defund ACORN Act"; Is it a "Bill of Attainder"? (Sept 22,2009).
23

Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 24 of 33
Cong. Rec. SI 1313 (daily 00. Nov. 10, 2009); see also 155 Congo Rec. S9317 (daily 00. Sept. 14, 2009) (statement of Sen. Johanns) ("Somebody has to go after ACORN. Madam ""'sidont, I
suggest this afternoon that 'somebody' is each and every Member of the Senate.,.
Statements by other legislators ecboe<! the punitive purpose of the legislation. See, e.g., 155 Cong. Re<:. S9314 (daily ed. Sept. 14,2009) (statement of Sen. Kit Bond) (stating that ACORN's problem is not one of "a handful of rogoe employees, but, regrettably, an endemic
systemwide culture of fraud and abuse" and that "Congress has the opportunity to end this relationship now"). In addition, the staff of Representative Darrell Issa authored an 88-page
report entitled "Is ACORN Iotentionally Structured as a Criminal Enterprise?", which states that "ACORN has repeatedly and deliberately engaged in systemic fraud" and accuses ACORN of conspiring to use taxpayer funds for partisan purposes.16 The government correctly notes that the Issa Report was authored solely by Representative Issa's office and was not commissioned
by Congress. Nevertheless. because Senator Johanns himself requested that its executive summary be entered into the congressional record, the Issa Report is relevant to this inquiry. See ISS Cong. Roc. 59309 (daily ed. Sept. 14,2009) (statement of Sen. Johanns introducing Issa
Report in support of what would become Section 418 of the HUD appropriations bill). Without more. the legislative history would not be enough to render the legislation a bill
of attainder. But these statements underline the pwritive nature of the legislation. See Con Ed, 292 F.3d at 355 ("[Tlhe stated intent of at least some legislator.;-most notably one of the floor managers of the legislation-to punish Con Ed reinforces our independent conclusion that a
16 With respect to plaintiffs' allegations that the challenged provisions are intended to punish ACORN for its impermissible partisanship, a statement Representative lssa made in response to OLC's October 23, 2009 memorandum construing the scope of Section 163 is noteworthy. In that statement. Representative [ssa accused OLe of "old-fashioned cron)i.sm" and stated that "[t1axpayers should not have to continue subsidizing a criminal enterprise that helped Bamek Obama get elected President." Press Release, Rep. Darrell Issa, Issa Blasts Administrative Decision to Fund ACORN - Reeks of Political Cronyism (Nov. 27, 2009).
24

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Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 25 of 33
substantial part of the legislation cannot be justified by any legislative purpose but punishment. ").
The Supreme Court counseled in Flemming that each attainder case '"turn[s] on its OVVll
highly particularized C<Jntext." Flemming, 363 U.S. at 616. Here, as in Levett, Congress deprived plaintiffs of an opportunity available to all others. Especially where plaintiffs have received federal funds from many federal grants and C<Jntmcts over the years, it cannot be said that such deprivation is anything short of punishment as that has been understood in the hill of attainder cases. The challenged provisioru, by singling out ACORN and its affiliates for severe, sweeping restrictions, constitute punishment under the three factors the Supreme Court has articulated for making this determination.I?
II. Remedies A, Standing/Remedies As To Certain Defendants Before considering particular remedies, I address the government's arguments that the
court lacks jurisdiction to award any remedy against certain defendants. The government relies on Article Ill's case-or-controversy requirement, which limits federal jurisdiction to actual,
ongoing controversies between the parties. See Northwestern Fla. Chapter 0/Associated Gen.
Contractors ofAm. v. City ofJacksonville, 508 u.s. 656, 663 (1993). The government does not
challenge plaintiffs' standing against the United States and the Secretary of HUD, but raises issues as to the remaining defendants.
In essence, the government claims that plaintiffs have no standing as to two categories of named defendants. The first category of defendants consists of the heads of three of the government departments/agencies whose funds ACORN is barred from receiving: the
17 Because [ find the cballenged provisions unconstitutional under the Bill of Attainder Clause, I do not reach plaintiffs' claims under the First Amendment and the Due Process Clause.
25

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Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 26 of 33
!
i

I

Department of Defense. the EPA, and the Department of Commerce. The government contends

I

that plaintiffs cannot point to any funding they might receive from these three that is affected by

the challenged provisions. The second category is comprised of the heads of OMB and the

Department of the Treasury, because, the government contends, neither enforces the restrictions on funding.

1.

Deoartment of Defense. EPA. and Department of Commerce

The challenged provisions include bans on funding from the Defense Department, the

EPA, and the Commerce Department. It is not disputed that plaintiffs have received funding

from the EPA. either directly or indirectly, and that they have an interest in future funding from

both the EPA and Commerce. The defendants simply argue that ACORN cannot identify a

specific grant from the EPA or Commerce that ACORN is being deprived of at the moment;

plaintiffs dispute this contention, but the parties' disagreements as to the particulars of a few

specific grant opportunities are immaterial. .There is no dispute that the funding prohibitions bar

ACORN and its affiliates from obtaining federal funding either directly from a gnmt, or

indirectly as a subcontractor, from the EPA or the Commerce Department. Plaintiffs have never

sought funding from the Department of Defense and agree that they have DO expectation of

seeking funding from that Department

But even where there is no direct economic injury. reputational injury, as the government

acknowledges, can be an injury-in-fact for standing purpos~s. In Gully 'V. National Credit Union

Administration Board, 341 F.3d 155, 162 (2d Cir. 2003), for example, the Second Circuit

concluded that the plaintiff had standing to challenge a ruling of misconduct, even though the

reprimand was not accompanied by a suspensjon of any kind, because "[ilt is self-evident that

Gully' s reputation will be blackened by the Board's finding of misconduct and unfilness." Id.

Similarly, in For,tich v. United States, 351 F.3d 1198 (D.c. Cir. 2003), the D.C. Circuit

26

1
Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 27 of 33
considered whether a plaintiff could challenge as a biU of attaindar a statute that deprived him of his .child visitation rights, even though his child was eighteen, and the statute no longer had any practical effect on his right to see her. The D.C. Circuit concluded that his reputational injuries
formed the basis for standing. reasoning that "Congress's act of judging Dr. Foretich and legislating against him on the basis of that judgment-the very things that, as we will see, render
the Act an unconstitutional bill of attainder---<lirectly give rise to a cognizable injury to his
reputation ...." Id. at 1213.
The primary argument the government makes in opposition to reputational standing in this case is that plaintiffs' own highly publicized misdeeds, and not the challenged provisions, were the cause of any reputational hanns, and that, consequently. judicial relief would not remedy the damage. In Foretich, the D.C. Circuit rejected that argument for reasons equally
applicable to this case. The court acknowledged that "[i)t may be true .. . that the damage to Dr.
Foretich' s reputation comes in part from the publicity surrounding the custody dispute and [his
ex-wife's) allegations, not solely from the [challenged starule]." But
[T)his misses the point. The Act itself has caused significant hann to Dr. Foretich. Therefore, by vindicating Dr. Foretich's assertion that Congress unfairly and unlawfully rendered a judgment as to his character and fitness as a father, declaratory rellef will provide a significant measure of redress sufficient to satisfy the
requirements of Article III standing. Here, a decision declaring the Act unlawful would make clear that Congress was wrong to pass
judgment on Dr. Foretich and wrong to single him out for punislunent on the basis ofthat judgment.
Id. at 1216. Similarly, in Gully, the Second Circuit characterized as "facile" the government's argwnent that the reprimand itself had not caused plaintiff's injuries. There, the Circuit wrote that "[i]t is the Board's determination, not Gully's reprehensible conduct. that bas sullied her reputation in the credit union industry ...." Gully. 341 F.3d at 162.
The same reasoning applies here; plaintiffs have suffered from the congressionw
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determination of plaintiffs' guilt, and relief in this action "would make clear that Congress was wrong to pass judgment on [plaintiffs] and wrong to single[them] out for punislunent on the basis of that judgment" Forelich, 351 F.3d at 1216. Moreover, the record establishes that the reputational injury has an economic component. The challenged legislation has not only barred ACORN from federal funding but has also affected ACORN's ability to obtain funding from non-goverrunental entities fearful of being tainted-because of the legislation-as an affiliate of ACORN. Accordingly, even apart from plaintiffs' direct economic injuries, their reputational injuries provide an independent basis not only for standing against all of the defendants, but also for relief against them.
11. O:MB and the Department of the Treasury The government asserts that the Director of OMB and the Secretary of the Treasury are not properly-named defendants on the ground that neither enforces the chaUenged provisions. This argument takes too narrow a view of these agencies' roles in the federal appropriations process. OMB's acknowledged practice is to notify agencies of recently-enacted provisions of broad importance, as illustrated by OMB's issuance of a memorandum after Section 163 was passed. Because that memorandum is onc of the primary sources of plaintiffs' reputational
harms, and considering OMB' s continuing responsibility to explain appropriations provisions to
agencies, plaintiffs have: sufficiently alleged an injury-in-fact to suppon standing against the OMB's Director. As for the TreasUry Department, it is responsible for disbursing federal funds, which "may not be disbursed or drawn down from the treasury of the United States unless authorized in accordance with an appropriation act." Decl. of Rita Bratcher, Gov't's Mem. of Law in Opp. to Mot. for Perm. Relief, Ex. B. Although the certifying officials of grant-making agencies may have the primary role in determining whether a disbursement is authorized, the plain language of the challenged provisions prohibits the Treaswy Department as the disbursing
28

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agency from "providing" Or "distributing" funds to ACORN, and provides. basis for standing
against the Secretary ofthe Treasury.
Both OMB and the Department of the Treasury therefore play key roles in admiItistering the appropriations process, and the government has offered no sound reason not to include aU
agencies that participate in enforcing the unconstitutional provisions. In fact. when enjoining the United States, the court is required to name all officials responsible for compliance with the
injunction. Here that includes the Director of OMB and the Secretary of the Treasnry. See 5 U.S.C. § 702 C'The UItited States may be named as a defendant in [a challenge to agency action or inaction seeking relief other than monetary damagesl, and a judgment Or decree !l18y be
entered against the United States: Provided, That any mandatory or injunctive decree shall specify the Federal officer or officers (by name or by title), and their successors in office, personally responsible for compliance.'.
B. Availability ofPermanent ReliefAgainst Section 163 Because Section 163 has now expired, the government argues that a judgment that
Section 163 is unconstitutional would not offer plaintiffs any relief. The expiration of the Continuing Resolutio~ however, did not end Section 163's impact on plaintiffs. As described
above, OMB sent a memo to every federal agency in Section 163 's wake, infonning the agencies that Congress had cut off funding to plaintiffs, and directing them to inform their grantees, and
their grantees' subcontractors, of the funding ban on plaintiffs. The reach of this memo was broad, and its effect, lasting. For example, the EPA sent an email to nearly all EPA financial assistance recipients and procurement contractors informing them of the broad scope of the funding prohibitions. Following ACORN I, OMB did send an email to all federal agencies'
general counsels informing them of the injunction entered in ACORN I and that the government was considering appeal, but OMB did not direct them to inform their agencies, grantees, and
29

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grantees' subcontractors of this court's ruling. The reputational harm, therefore, continues, 'as
the original adviee from OMB to the hWldreds, if not thousands, of recipients of that adviee has
l' never been rescinded.
C. Declaratory and Injunctive Relief The Declaratory Judgment Act provides that "[i]n a case of actual controversy within its jurisdiction ... any court of the United States, upon the filing of an appropriate pleading, may
declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought" 28 U.S.C. § 2201; see also Fed. R. Civ. P. 57. For the reasons explained above, I now direct entry of 8 declaratory judgment that the challenged provisions an: Wlconstitutional because they violate the Bill of Attainder Clause.
In addition to the declaratory judgment, plaintiffs seek a permanent injunction to undo the damage the challenged provisions are causing. "To obtain a pennanent injunction, a plaintiff must succeed on the merits and show the absence of an adequate remedy at law and irreparable harm if the relief is not granted." Roach v. Morse, 440 F.3d 53, 56 (2d Cir. 2006) (internal quotation marks omitted). Plaintiffs have prevailed on their bill of attainder claim. As for irreparable harm, it is Wldisputed that prior to the funding ban, plaintiffs had received significant

1.

The government has separately moved to vacate the December 11, 2009 Injunction and

Order, referred to in this opinion as ACORN I, on the groWld that the preliminary injunction

became moot before the government had the opportunity to appeal. The government takes the

position that the subject of the decision, Section 163 of the Continuing Resolution, was "without

effect" through "happenstance" as the Continuing Resolution had expired on its own tenns on

December 18,2009.

The government's motion to vacate is denied. As described in the tc:xt, the expiration of

the Continuing Resolution did not end Section 163's impact on plaintiffs. In ACORN I, as here,l

concluded that Congress made a determination of plaintiffs' guitt in its enactment of Section

163. Like Dr. Foretich. discussed above, plaintiffs suffered a reputational injury that continues

regardless of whether Section 163 continues to cut off any funds to plaintiffs. For that reason,

plaintiffs' claims relating to Section 163 survive its expiration, and there is no basis for vacating

ACORN I as moot. Of course, the relief to be entered today will supersede the decision in

ACORN1, which was limited to preliminary relief.

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Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 31 of 33

amounts of federal funding, either directly Or indirectly as subcontractors; that grants with the government have been suspended; and that they cannot receive renewals or new grants under the challenged legislation.J9 Because the government's sovereign immunity prevents plaintiffs from bringing suit against the govenunent for monetary damages for these injuries, these harms are, by definition, irreparable.
Putting aside the role of sovereign inununity in barring the recovery of damages in·this case, and any other limitations on the recovery of damages by govermnent contractors where sovereign immunity has been waived, the amount of money plaintiffs might have been awarded had they been allowed. to compete for contracts is, as the government acknowledges, impossible to calculate. See Lion Raisins, Inc. v. United States, 52 Fed. Cl. 115, 119-20 (Fed. Cl. 2002) (noting that injunctive relief is "the most common remedy" for a contractor wrongfully. suspended from bidding on government contracts, and that "the specter of lost profits often constirutes the irreparable harm upon which injunctive relief is based"). Even in non~ constitutional cases that involve suspension or debannent from federal contracting, courts have granted injunctive relief where money damages will not be available and where the conr:ractor has made a sufficient showing on the merits of its claim. See, e.g., Alfv. Donley, 666 F. Supp. 2d 60, 70 (D.D.C. 2009) (taking into account the plaintiff's inability to recoup lost income
because of sovereign immunity as a factor in finding irreparable harm). A finding of significant
violation of constitutional rights also supports the finding of irreparable hann. See Mitchell v. Cuomo, 748 F2d 804, 806 (2d Cir. 1984) ("When an alleged deprivation ofa constitutional right
is involved, most courts bold that no further showing of irreparable injury is necessary.j; see

"

Only because of the OLC Memo of October 23, 2009, described above, which raised the

possibility ofa bill of attainder issue if they were not paid, were plaintiffs paid on the suspended

contracts for work they had already perfonned.

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also IIA Charles Alan Wright, Arthur R. Miller, and Mary Kay Kane, Federal Practice and Procedure § 2948.1 (2d ed. 2009) (same).
In addition to their irreparable economic hanns, plaintiffs have also established reputational injuries for which they can never recover damages at law from the defendants. All of these injuries may continue in the absence of injunctive relief from this court. In determining the nature of the injunctive relief to be awarded. I have considered the acknowledged role of OMB in explaining appropriations provisions to federal agencies, as exemplified by its issuance of the Section 163 memorandum. To date OMB has not rescinded that memorandwn. Therefore, injunctive relief will issue to assure that, so far as possible, the harms caused by the
unconstitutional legislation will be undone. CONCLUSION
Plaintiffs have prevailed on their bill of attainder claim. They have also established irreparable hann and the need for both declaratory and injunctive relief. Therefore plaintiffs' motion for declaratory relief and a permanent injunction is GRANTED. The government's "cross-motion to dismiss and for summary judgment" is DENIED. The government's motion to
vacate ACORN Iis DENIED. A judgment in the following form sball issue:
It is hereby DECLARED that, pursuant to Article I, Section 9, of the United States Constitution, the following Acts of Congress are unconstitutional: The Continuing Appropriations Resolution, 2010, Public Law 111-68, Division B, Section 163; the Department of the Interior, Environment, and Related Agencies Appropriations Act of 2010, Public Law 111-88, Division A, Section 427; Consolidated Appropriations Act of 2010, Public Law 111-117, Division A, Section 418; Consolidated Appropriations Act of 2010, Public Law 111-117, Division B, Section 534; Consolidated Appropriations Act of 2010, Public Law 111-117, Division E, Section 511; and the Department of Defense Appropriations Act of 2010, Public Law 111-118, Division A, Section 8123.
32

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Case 1:09-cv-04888-NG -LB Document 50 Filed 03/10/10 Page 33 of 33

An injunction in the following [OIm shall issue:

Defendants the UNITED STATES OF AMERICA; SHAUN DONOVAN, in
his official capacity as Secretary of the Department of Housing and Urban Development; PETER ORSZAG, in his official capacity as Director of the Office of Management and Budget; TIMOTHY GEITHNER, in his official capacity as Secretary of the Department of Treasury of the United States; LISA P. JACKSON, in her official capacity as Administrator of the Environmental Protection Agency; GARY LOCKE, in his official capacity as Secretary of Commerce; and ROBERT GATES, in his official capacity as Secretary of Defense; and all those acting in concert with them, are hereby pennanently

ENJOINED from enforcing the Department of the Interior, Envirorunent, and Related Agencies Appropriations Act of 2010, Public Law 111-88, Division A, Section 427; Consolidated Appropriations Act of 2010, Public Law 111-117, Division A, Section 418; Consolidated Appropriations Act of 2010, Public Law 111-117, Division B, Section 534; Consolidated Appropriations Act of 2010, Public Law 111-117, Division E, Section 511; and the Department of Defense Appropriations Act of2010, Public Law 111-118, Division A, Section 8123; and

Defendant PETER ORSZAG, in his official capacity as Director of the Office of Management and Budget, is hereby permanently

(1) ENJOINED from instructing or advising federal agencies to enforce any of the legislative provisions declared unconstitutional by this
court~
(2) ENJOINED to officially rescind the October 7, 2009 OMB memorandum entitled "Memorandum for the Heads of Executive Departments and Agencies" providing "[gJuidance on [SJection 163 of the Continuing Resolution regarding the Association of Community Organizations for Reform Now (ACORN)" ("the OMB Memorandum");
(3) ENJOINED (a) to advise all federal agencies to whom he or his agents sent the OMB Memorandum that tlte legislative provisions which are the subject of this injunction have been declared unconstitutional; and (b) to instruct all federal agencies that they should advise their contractors or grantees that those legislative provisions have been declared unconstitutional by this court.

SO ORDERED.

".

~

~i

A

Dated: March 10, 2010 Brooklyn, New York

NINA GERSHON United States District Judge
33

 
 Case 1:09-cv-04888-NG -LB Document 56 Filed 03/31/10 Page 1 of 2

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK --------------------------------------------------------------------X ASSOCIATION OF COMMUNITY ORGANIZATIONS FOR REFORM NOW; ACORN INSTITUTE, INC.; and MHANY MANAGEMENT, INC., f/k/a NEW YORK ACORN HOUSING COMPANY, INC.,
Plaintiffs,
-against-

ORDER 09-CV-4888 (NG)

UNITED STATES OF AMERICA; SHAUN DONOVAN, Secretary of the Department of Housing and Urban Development; PETER ORSZAG, Director, Office of Management and Budget; TIMOTHY GEITHNER, Secretary of the Department of Treasury of the United States; LISA P. JACKSON, Administrator of the Environmental Protection Agency; GARY LOCKE, Secretary of Commerce; and ROBERT GATES, Secretary of Defense.
Defendants. --------------------------------------------------------------------X GERSHON, United States District Judge:
Defendants’ motion to “stay declaratory judgment and permanent injunction pending
appeal, or in the alternative, for a temporary administrative stay” is denied. Defendants have
shown no substantial possibility of success on the merits on appeal. Plaintiffs risk significant
and pressing irreparable injury if a stay is issued. On the other hand, defendants have
demonstrated no irreparable harm or damage to the public interest, as “each agency will continue
to be able to use its discretion to determine the merit of the plaintiffs’ proposals, and to suspend

Case 1:09-cv-04888-NG -LB Document 56 Filed 03/31/10 Page 2 of 2

the contracts for cause, or even to debar ACORN, if warranted under the terms and procedures in the contracts and applicable regulations.” See ACORN v. United States, 662 F. Supp. 2d 285, 299 (E.D.N.Y. 2009).
Plaintiffs’ “cross-motion for an order directing defendant Shaun Donovan’s immediate compliance with the court’s permanent injunction” is procedurally improper. In any event, it appears unnecessary in light of defendants’ response dated March 30, 2010.

Dated: March 31, 2010 Brooklyn, New York

SO ORDERED.
_/s/ Nina Gershon_________ NINA GERSHON United States District Judge

 
 Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 1 of 15

UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF NEW YORK

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

:

ASSOCIATION OF COMMUNITY

:

Civil Action No.

ORGANIZATIONS FOR REFORM

:

09-CV-4888 (NG)

NOW, et al.,

:

:

Plaintiffs,

:

:

(Gershon, J.)

vs.

:

(Bloom, M.J.)

:

UNITED STATES OF AMERICA, et al.,

:

:

Defendants.

:

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

MOTION AND SUPPORTING MEMORANDUM TO STAY DECLARATORY JUDGMENT AND PERMANENT INJUNCTION PENDING APPEAL OR, IN THE ALTERNATIVE, FOR A TEMPORARY ADMINISTRATIVE STAY PENDING THE COURT OF APPEALS’ RESOLUTION OF DEFENDANTS’ MOTION PURSUANT TO
FEDERAL RULE OF APPELLATE PROCEDURE 8

INTRODUCTION

This Court has enjoined Defendants from enforcing a number of statutes that the Court itself

recognized “enjoy a high presumption of legitimacy.” March 10, 2010 Opinion and Order (Dock

No. 50) at 2 (“Opinion”). Neither the Court of Appeals for the Second Circuit, nor the Supreme

Court, has ever held that the withholding of a corporate entity’s opportunity to apply for

discretionary government funds is “punitive” within the meaning of the bill of attainder clause.

Enforcement of the declaratory judgment and injunction prior to review by the Court of Appeals is

at odds with the presumption of constitutionality that attaches to every Act of Congress. As

explained below, Defendants have a substantial likelihood of success on appeal. Moreover, given

the harm to the government from enjoining a presumptively valid Act of Congress prior to appellate

review, the specific effects of the injunction on HUD and other agencies, and the likely possibility

1

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 2 of 15
that funds will be disbursed to Plaintiffs for which Defendants will be unable to recover, the balance of hardships weigh in Defendants’ favor.
STANDARD OF REVIEW Defendants seek a stay of the permanent injunction pending appeal pursuant to Fed. R. Civ. P. 62(c) which provides that “[w]hen an appeal is taken from an interlocutory or final judgment granting, dissolving, or denying an injunction, the court in its discretion may suspend, modify, restore, or grant an injunction during the pendency of the appeal ...” In this Circuit, four factors must considered before staying the actions of a lower court including: (1) whether the movant has demonstrated a substantial possibility, although less than a likelihood of success, on appeal; (2) whether the movant will suffer irreparable injury absent a stay; (3) whether another party will suffer irreparable injury if a stay is issued; and (4) the public interests that may be affected. See Hirschfeld v. Bd. of Elections, 984 F.2d 35, 39 (2d Cir.1993); see also In re World Trade Center Disaster Site Litigation, 503 F.3d 167, 170-71 (2d Cir. 2007). In Mohammed v. Reno, 309 F.3d 95 (2d Cir. 2002), the Second Circuit surveyed how different courts have analyzed the likelihood of success necessary for issuing a stay, ultimately agreeing with the District of Columbia Circuit’s approach, whereby “[t]he necessary ‘level’ or ‘degree’ of possibility of success will vary according to the court’s assessment of the other [stay] factors.” Id. at 101 (quoting Washington Metro. Area Transit Comm’n v. Holiday Tours, Inc., 559 F.2d 841, 843 (D.C. Cir. 1977)). The Court observed: “[t]he probability of success that must be demonstrated is inversely proportional to the amount of irreparable injury plaintiff will suffer absent the stay. Simply stated, more of one excuses less of the other.” Mohammed, 309 F.3d at 101 (citing Washington Metro. Area Transit Comm’n, 559 F.2d at 843)).
2

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 3 of 15
ARGUMENT A. Defendants Have a Substantial Likelihood of Prevailing on their Appeal
The three-part test articulated by the Supreme Court to determine whether an act of Congress is “punishment” within the meaning of the Bill of Attainder Clause derives from (1) whether the challenged statute “falls within the meaning of legislative punishment;” (2) whether “viewed in terms of the type and severity of burdens imposed, [the statute] reasonably can be said to further nonpunitive legislative purposes;” and (3) whether the legislative record “evinces a congressional intent to punish.” Selective Serv. Sys. v. Minn. Public Interest Research Group, 468 U.S. 841, 852 (1984); see also Nixon v. Adm’r of Gen. Servs., 433 U.S. 425, 473, 475-76, 478 (1977); Consol. Edison Co. of New York v. Pataki, 292 F.3d 338, 350 (2d Cir. 2002) (“The party challenging the statute has the burden of establishing that the legislature’s action constituted punishment . . . .”) (citation omitted). When applied here, these principles confirm that the temporary funding suspensions at issue are not “punishment,” but instead valid exercises of the Congressional power-ofthe-purse to protect the public fisc.
First, it is altogether unclear whether the decision not to appropriate discretionary funds to a corporate entity such as ACORN or its affiliates constitutes punishment within the historical meaning of the bill of attainder clause. As this Court readily acknowledges, the “idea that the deprivation of the opportunity to apply for discretionary federal funds is ‘punitive’ within the meaning of the attainder clause at first blush seems implausible.” Opinion at 12. Noting the lack of guidance from either the Supreme Court or Second Circuit, this Court relies upon the reasoning of an unpublished district court decision in another Circuit regarding a state law. Id. See Fla. Youth Conservation Corps., Inc. v. Stutler, 2006 WL 1835967, at *2 (N.D. Fla. June 30, 2006).
3

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Leaving that unpublished opinion aside, each legislative decision regarding prospective, discretionary funding must be viewed in context. More recently, the Eleventh Circuit Court of Appeals upheld a restriction which withheld government funds from a group of state felons and sex offenders. See Houston v. Williams, 547 F.3d 1357, 1360-61, 1364 (11th Cir. 2008). In that case, despite otherwise meeting federal eligibility requirements, plaintiff’s application for federal funds for weatherization assistance was denied because of his criminal history. Id. at 1360. In upholding the prospective, discretionary funding restriction, the Court of Appeals concluded that the district court correctly determined that the policy did not inflict punishment and furthered “the non-punitive goal of allocating resources.” Id. at 1364. Although Houston did not involve a federal law, it is worth noting that the Court of Appeals viewed the exclusion of felons and sex offenders as simply motivated by the “non-punitive goal of allocating resources,” rather than finding guilt on a specified charge. Thus, there is at least a reasonable possibility that the Second Circuit could also consider non-punitive a decision about how to distribute scarce resources.
“In England a bill of attainder originally connoted a parliamentary Act sentencing a named individual or identifiable members of a group to death.” Nixon, 433 U.S. at 473. In American history, the Constitution’s ban on bills of attainder was also applied to imprisonment, banishment, and the punitive confiscation of property. See id. at 473-74. More recently, the Supreme Court has expanded the definition of punishment to include “legislative enactment[s] barring designated individuals or groups from participation in specified employments or vocations, a mode of punishment commonly employed against those legislatively branded as disloyal.” Id. at 474; see also Selective Serv. Sys., 468 U.S. at 852; Navegar, Inc. v. United States, 192 F.3d 1050, 1066 (D.C. Cir. 1999); Atonio v. Wards Cove Packing Co., Inc., 10 F.3d 1485, 1496 (9th Cir. 1993). Thus, while the
4

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 5 of 15
Supreme Court has not strictly limited the Bill of Attainder Clause to the punishments specifically contemplated by the Framers, the Court has found it applicable in only five instances, in each of which Congress had, in fact, inflicted punishment on individuals or groups of individuals for political acts or beliefs.
Plaintiffs here, by contrast, have merely experienced the denial of certain prospective governmental grants and contracts, from only certain agencies, and even then for only a finite period of time. In general, the Supreme Court has indicated that the denial of a benefit does not constitute historical punishment in the bill of attainder context. In Flemming v. Nestor, 363 U.S. 603 (1960), the Court considered whether the denial of Social Security benefits to an eligible alien who was deported constituted a bill of attainder. The Court observed that this denial did not fall within the traditional meaning of a legislative punishment. Id. at 617 (“Here the sanction is the mere denial of a noncontractual governmental benefit.”); see also Selective Serv. Sys., 468 U.S. at 853 (quoting Flemming v. Nestor for this point).
Courts considering whether certain legislative acts have constituted punishment for bill of attainder purposes have typically found punishment only when the statutes singled out individuals or groups of individuals for punishment – not corporate entities like plaintiffs here. True, the one notable exception to this historical pattern arose in this Circuit, when the Court of Appeals struck down a state statute in Con. Ed. as a bill of attainder. But a statute which precludes a public utility from setting rates so as to pass on to their ratepayers the legitimate costs associated with restoring power after an outage (costs the utility would normally be entitled to recapture) is a far cry from statutes which temporarily bar a specified corporate entity from receiving discretionary funds to which they have no legal or historical entitlement. Courts have generally looked with skepticism at
5

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 6 of 15
claims by corporate entities claiming that certain legislation has punished them, see, e.g., SeaRiver Mar. Fin. v. Mineta, 309 F.3d 662, 673-74 (9th Cir. 2002), and there is a substantial possibility that, notwithstanding Con. Ed., the Second Circuit will do the same here.1
Second, even applying the “functional test” to gauge whether the legislation at issue constitutes a bill of attainder, the Court of Appeals may have questions about whether the burdens imposed serve a legitimate, nonpunitive purpose. The functional test inquires:
whether the law under challenge, viewed in terms of the type and severity of burdens imposed, reasonably can be said to further nonpunitive legislative purposes. Where such legitimate legislative purposes do not appear, it is reasonable to conclude that punishment of individuals disadvantaged by the enactment was the purpose of the decisionmakers. Nixon, 433 U.S. at 475-76, 97 S.Ct. 2777 (internal citations omitted); see also Hawker v. New York, 170 U.S. 189, 196 (1898) (rejecting bill of attainder and ex post facto challenges to a statute barring ex-felons from the practice of medicine); SeaRiver, 309 F.3d at 674 (“[E]ven if the Act singles out an individual on the basis of irreversible past conduct, if it furthers a nonpunitive legislative purpose, it is not a bill of attainder.”). The funding suspension provisions at issue here “can be said to further nonpunitive legislative purposes.” Selective Serv. Sys., 468 U.S. at 852 (internal quotation marks omitted). Congress chose to deny discretionary financial support to an organization that it had a legitimate reason to fear might misuse the funds. To address these changes, Congress commissioned a GAO investigation of that organization’s use of funds and acted to protect appropriated funds. These Congressional concerns
1 Moreover, there are reasons to doubt whether a corporate entity really suffers a justiciable injury to its “reputation” when Congress passes a law that cuts off its funding. Notably, the cases relied upon in this Court’s opinion regarding reputational injury relate to individuals not corporations. See Foretich v. United States, 351 F.3d 1198, 1213 (D.C. Cir. 2003); Gully v. Nat’l Credit Union Admin. Bd., 341 F.3d 155, 161-62 (2d Cir. 2003).
6

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 7 of 15
for preventing future waste, fraud, and abuse, and monitoring agency distribution of funds, coming in the form of withholding discretionary payments, constitutes a nonpunitive purpose and a legitimate exercise of the Article I power-of-the-purse.
Finally, the search for punitive legislative motives is rarely significant. As the Supreme Court explained:
We observe initially that only the clearest proof could suffice to establish the unconstitutionality of a statute on such a ground. Judicial inquiries into Congressional motives are at best a hazardous matter, and when that inquiry seeks to go behind objective manifestations it becomes a dubious affair indeed. Moreover, the presumption of constitutionality with which this enactment, like any other, comes to us forbids us lightly to choose that reading of the statute's setting which will invalidate it over that which will save it. Fleming v. Nestor, 363 U.S. 603, 617 (1960); see also Selective Serv. Sys., 468 U.S. 841, 855 n.15 (1984) (requiring "unmistakable evidence of punitive intent" by Congress before a statute may be invalidated on bill of attainder grounds) (quoting Fleming, 363 U.S. at 619) (emphasis added). The Court of Appeals for this Circuit has echoed that "[t]he legislative record by itself is insufficient evidence for classifying a statute as a bill of attainder unless the record reflects overwhelmingly a clear legislative intent to punish." Con. Ed., 292 F.3d at 354 (emphasis added). "Statements by a smattering of legislators do not constitute the required unmistakable evidence of punitive intent." Id. (citation and quotation omitted) (emphasis added); see also United States v. O'Brien, 391 U.S. 367, 384 (1968) ("What motivates one legislator to make a speech about a statute is not necessarily what motivates scores of others to enact it."); Edwards v. Aguillard, 482 U.S. 578, 637-638 (1987) (Scalia, J., dissenting).
B. The Government Will Be Irreparably Harmed Absent a Stay
7

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 8 of 15
The Government will suffer irreparable harm absent a stay of this Court’s order. The presumption of constitutionality of a valid enactment of Congress is an equity to be considered in Defendants’ favor in weighing a stay of an injunction. See Walters v. National Association of Radiation Survivors, 468 U.S. 1323, 1324 (1984) (Rehnquist, J., in chambers); see also New Motor Vehicle Board v. Orrin W. Fox Co., 434 U.S. 1345, 1351 (1977) (Rehnquist, J., in chambers). This rationale applies to staying declaratory judgments as well. See Bowen v. Kendrick, 483 U.S. 1304, 1304 (1987) (Rehnquist, J., in chambers) (observing that “[i]t has been the unvarying practice of this Court ... to note probable jurisdiction and decide on the merits all cases in which a single district judge declares an Act of Congress unconstitutional. In virtually all of these cases the Court has also granted a stay if requested to do so by the Government.”)
The harm from declaring an Act unconstitutional is not simply theoretical, but has a real world impact on the government’s ability to effectively administer programs. See, e.g., Ledbetter v. Baldwin, 479 U.S. 1309, 1310 (1986) (Powell, J., in chambers) (finding irreparable harm and granting stay of injunction where district court order holding state regulations unconstitutional would cause state government to incur administrative costs and make payments which would later be unrecoverable); c.f., Forum for Acad. and Inst. Rights, Inc. v. Rumsfeld, 291 F.Supp.2d 269, 322 (D.N.J. 2003) (harm to the government in being precluded from enforcing “presumptively valid” Solomon Amendment outweighed harm to plaintiffs in absence of injunction); Christian Civic League of Maine, Inc. v. F.E.C., 433 F.Supp.2d 81, 90 (D.D.C. 2006) (injunction would “substantially injure” the Federal Election Commission and the public given the presumption of constitutionality and the statutory duty of the Commission to enforce the Bipartisan Campaign Reform Act of 2002). A similar type of real world impact would be felt immediately by Defendants in administering their
8

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 9 of 15
respective programs. In the absence of a stay, Defendant HUD will be forced by the terms of the injunction to
provide funds to ACORN Institute and MHANY and perhaps other ACORN affiliates covered by the statute (hereafter referred to as “covered entities”).2 If the current injunction is not stayed–but then is later vacated by the Court of Appeals upon a holding that these provisions are constitutional–ACORN, ACORN Institute, MHANY, and other covered entities are likely to have already performed work in the intervening period under the renewed contract or grant, work for which they will have already received payment. Moreover, given the rather complicated and opaque structure of ACORN and other covered entities, not to mention ACORN’s history of maintaining poor internal controls as documented in the previously-submitted Harshbarger Report, it may be difficult to trace exactly which groups received money through subcontracts and determine when and where money was disbursed in the intervening period. At least as significant is that if HUD and/or other agencies award Plaintiffs multi-year government grants during the period of the injunction, and the injunction is vacated on appeal, HUD and other agencies would be forced either to rescind the awards and unwind ongoing federal programs, or (if that is not possible) to continue making payments to Plaintiffs under the obligations undertaken during the period while this Court’s injunction is in effect.
2Section 418 of Division A of the Consolidated Appropriations Act 2010, Pub. L. No. 111-117, includes the language “subsidiaries, affiliates, or allied organizations,” whereas the other four challenged Acts currently in effect use the terms “ACORN or its subsidiaries.” See Department of Interior, Environmental, and Related Agencies Appropriations Act, 2010, Pub. L. No. 111-88, § 427, 123 Stat. 2904, 2962 (2009); Consolidated Appropriations Act, 2010, Pub. L. No. 111-117, Div. B § 534, Div. E § 511, 123 Stat. 3034 (2009); Department of Defense Appropriations Act, Pub. L. No. 111-118, § 8123, 123 Stat. 3409 (2009). The term “covered entities” is used above to encompass all groups that would fall within a respective Appropriations Act.
9

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 10 of 15
Under such circumstances where recovery of funds by the government is doubtful, this Court should conclude that the government is likely to be irreparably injured. For example, courts have found irreparable harm where the government would not be able to recover the value of seized property if it were to prevail on appeal, absent a stay pending appellate review. See, e.g., United States v. Fourteen Various Firearms, 897 F. Supp. 271, 273 (E.D. Va. 1995) (“[W]here the failure to enter a stay will result in a meaningless victory in the event of appellate success, the district court should enter a stay of its order.”) (citation omitted); United States v. $14,876.00 U.S. Currency, No. 97-cv-1967, 1998 WL 37522 (E.D. La. Jan. 29, 1998) (“[t]he property at issue is easily depleted. Therefore, absent a stay, the Government very likely would suffer irreparable harm if it were to succeed in its appeal.”). Thus, given the harm to the government from enjoining a presumptively valid Act of Congress prior to appellate review, the specific injuries associated with the enjoining of HUD and other agencies, and the likely possibility that funds will be disbursed to Plaintiffs and other covered entities for which Defendants will be unable to recover, the balance of hardships weigh in Defendants’ favor. C. Any Harm To Plaintiffs If A Stay Is Granted Is Minimal
The third factor – whether Plaintiffs will suffer substantial injury if a stay is granted – also weighs in favor of Defendants. In examining whether to enforce a permanent injunction, the temporary loss of income does not normally constitute irreparable harm, even if it represents a sizeable amount of funding. See, e.g., Somerset House, Inc. v. Turnock, 900 F.2d 1012, 1018 (7th Cir. 1990); Experience Works, Inc. v. Chao, 267 F.Supp.2d 93, 96 (D.D.C. 2003). That principle is implicated here.
ACORN alleges the funding suspension provisions “have caused, and continue to cause
10

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 11 of 15
ACORN irreparable harm,” but it does not explain exactly the nature or extent of this harm. Lewis Suppl. Aff. at ¶ 2. Indeed, a claim of “irreparable harm” would run directly counter to ACORN’s own December 2009 internal report, which concluded that only 10 percent of ACORN’s funding is derived from federal grants. Harshbarger at 7; see also Michael B. Farrell, ACORN Scandal: How Much Federal Funding Does It Get?, The Christian Science Monitor, September 19, 2009 (Exhibit W). Instead, ACORN contends that the funding suspension provisions have had a serious effect on some of its chapters (none of whom are parties here), and that they have caused the umbrella organization to cut back on its services. Lewis Suppl. Aff. at ¶ 2. But even if the “legal and governance structure of ACORN (the ‘ACORN Family’) is incredibly complex,” Harshbarger Report at 6, ACORN cannot claim irreparable injury simply because some of its chapters may be in financial trouble. It is unrealistic to believe the funding provisions alone have caused this damage. And ACORN itself has no expectation of applying for new federal grants or renewals of old grants—by its own admission, it “does not apply for federal grants.” Lewis Suppl. Aff. at ¶ 3.
MHANY has not alleged any imminent irreparable injury attributable to Defendant HUD. It has stated that it had a grant with New York State Mortgage Agency to provide mortgage counseling and advice under the National Foreclosure Mitigation Counseling (“NFMC”) Program and was told by the New York State Mortgage Agency that it was ineligible for the third round (and potentially a fourth round) of funding of this grant because of Section 418 of the T-HUD Appropriations Act. See Doc. No. 29, Pl. Exhibit E (Suppl. Aff. of Ismene Speliotis), at ¶¶ 2, 3 (filed in hard copy with the Court). But MHANY has not shown that this temporary loss of income constitutes irreparable injury.
ACORN Institute submitted an affidavit in support of Plaintiffs’ motion for permanent
11

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 12 of 15
injunction, which alleges pending applications for grants with EPA and Commerce, as well as suspended grants with HUD. See Doc. No. 29, Pl. Exhibit C (Suppl. Aff. of Brennan Griffin), at ¶¶ 2, 6, 7 (filed in hard copy with the Court). A closer inspection reveals that most of the injuries ACORN Institute has allegedly suffered no longer exist either because AI has been rejected for the grant in question or remains able to apply. ACORN Institute was considered and rejected on the merits of its proposal for a grant relating to indoor pollutants. Def. Exhibit D (Declaration of Howard F. Corcoran) at ¶¶ 5b, 5c (Doc. No. 38-7). Commerce has stated that ACORN Institute may be considered for the Broadband Technology Opportunities Program (“BTOP”) in the Agency’s Second Notice of Funds Availability (“NOFA”) because section 534 does not apply to financial assistance programs funded by prior Acts, such as the Recovery Act through which the BTOP is funded. Def. Exhibit E (Declaration of Anthony G. Wilhelm) at ¶ 8 (Doc. No. 38-8). There are a small number of suspended ROSS grants, see Suppl. Griffin Aff. at ¶ 7, but the continued suspension of these grants until the Court of Appeals decides the bill of attainder issue does not rise to the level of irreparable injury.
D. The Public Interest Favors A Stay Finally, the public interest weighs in the Government’s favor. In the present case, Congress decided, in the interests of preserving public funds and avoiding potential waste of tax dollars, to enact these temporary funding suspensions. See Virginian Ry. Co. v. Sys. Fed'n No. 40, 300 U.S. 515, 552 (1937) (statutory policy of Congress "is in itself a declaration of the public interest which should be persuasive" to courts); Consumers Power Co. v. Dep't of Energy, 1981 WL 1265, at *8 (E.D. Mich. 1981) (denying motion for preliminary injunction because, inter alia, the public interest would have been disserved by interfering with the implementation of an agency program). The heavy
12

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 13 of 15
presumption of legitimacy this Court is obliged to grant these legislative decisions underscores the strong public interest in the maintenance of these currently-valid laws. Refusing to stay the permanent injunction would frustrate that interest. See, e.g., Winter v. NRDC., 129 S.Ct. 365, 376-77 (2008) (“In exercising their sound discretion, courts of equity should pay particular regard for the public consequences in employing the extraordinary remedy of injunction.”) (citation and quotation omitted); see also Able v. United States, 44 F.3d 128, 131 (2d Cir. 1995) (“[G]overnmental policies implemented through legislation or regulations developed through presumptively reasoned democratic processes are entitled to a higher degree of deference and should not be enjoined lightly.”). The public interest would best be served by staying the permanent injunction, so that the Court of Appeals can decide this issue before Defendants begin disbursing funds. Plaintiffs will suffer no irreparable injury under this course of action.
E. In the Alternative, Defendants Request a Temporary Administrative Stay Pending the Court of Appeals Resolution of Defendants’ Motion For Stay Pending Appeal Made Under Federal Rule of Appellate Procedure 8
In the alternative, Defendants request that the Court grant a temporary, administrative stay of the injunction to give the Court of Appeals sufficient time to rule on a motion for stay pending appeal pursuant to Federal Rule of Appellate Procedure 8(a)(2). The Solicitor General has authorized an application to the Court of Appeals for such a stay in the event this Court denies the motion for stay pending appeal. Such an administrative stay would give the Court of Appeals the opportunity to consider a stay pending appeal on a non-emergency basis. If this Court enters an administrative stay, Defendants will promptly inform the Court of any decision by the Court of Appeals regarding a stay pending appeal.
13

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 14 of 15

WHEREFORE, for good cause shown, Defendants request the Court stay its Declaratory Judgment and Permanent Injunction (Doc. No. 51) pending appeal, or in the alternative, issue a temporary administrative stay pending the Court of Appeals’ resolution of Defendants’ motion under Federal Rule of Appellate Procedure 8.

Dated: March 17, 2010

Respectfully Submitted,
TONY WEST Assistant Attorney General
IAN HEATH GERSHENGORN Deputy Assistant Attorney General
BENTON J. CAMPBELL United States Attorney
F. FRANKLIN AMANAT Assistant United States Attorney
/s/ Bradley H. Cohen BRADLEY H. COHEN, D.C. Bar #495145 PETER D. LEARY, Virginia Bar #71196 MICHAEL SITCOV, D.C. Bar # 308682 Trial Attorneys U.S. Department of Justice Civil Division, Federal Programs Branch 20 Massachusetts Ave., N.W. Room 7338 P.O. Box 883 Washington, D.C. 20044 (202) 305-9855 (202) 616-8470 (fax) Email: Bradley.Cohen@usdoj.gov
Attorneys for the United States

14

Case 1:09-cv-04888-NG -LB Document 53 Filed 03/17/10 Page 15 of 15
CERTIFICATE OF SERVICE I, Bradley H. Cohen, hereby certify that on this 17th day of March, 2010, I did cause true and correct copies of the above and foregoing instrument, Defendants’ Motion to Stay Permanent Injunction Pending Appeal or, in the Alternative, for a Temporary Administrative Stay, to be served electronically on counsel for plaintiffs.
/s/ Bradley H. Cohen BRADLEY H. COHEN U.S. Department of Justice Civil Division, Federal Programs Branch 20 Massachusetts Ave., N.W. P.O. Box 883 Washington, D.C. 20044 (202) 305-9855 (202) 616-8470 (fax) Email: Bradley.Cohen@usdoj.gov
15

 
 [-p wy- 'Y,KVy Case 1:09-cv-048C8a8s-eN:G10-9L9B2 DoDcoucmuemnetn5t7: 24FilePda0g4e/0: 21/10 Page 1 of 1
Oq - c.V - Lf'i~~
G-e'Sho.,
UNITED STATES COURT OF APPEALS 
 FOR THE 

SECOND CIRCUIT 


At a Stated Tenn of the United States Court of Appeals for the Second Circuit, held at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York, on the 20d day of April, two thousand and ten.
PRESENT: Gerard E. Lynch, Circuit Judge.

Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.
Plaintiffs-Appellees,
v.
United States of America, Shaun Donovan, Secretary of the Department of Housing and Urban Development, Peter Orszag, Director of Management and Budget, Timothy Geithner, Secretary of the Department of Treasury of the United States,
Defendants-Appellants.

ORDER Docket No. 10-992

IT IS HEREBY ORDERED that the motion of the government for an administrative stay pending resolution of its motion for a further stay pending resolution of its appeal from the order of the District Court is granted. Appellees are granted until Monday morning, AprilS, 2010, at 10:00 a.m. to file a response to the government's motion. The motion for stay pending appeal will be determined by a three-judge motions panel as soon as possible. The parties are directed to confer and present the Court on Monday at 10:00 a.m. with either agreed dates for briefing of an expedited appeal, or competing proposals for such a schedule.

ATRUE COpy

_ Catherine PHagan "Volfe, Clerk
~-L~~~~~..·~~=='~=A~

_DEPUTY C~,-... _.... _,,~....

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CERTIFIE::

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FOR THE COURT, 
 Catherine O'Hagan Wolfe, Clerk 

Judy Pisnanont, Motions Staff Attorney

 
 Case: 10-992 Document: 78 Page: 1 04/21/2010 27127 1

United States Court of Appeals
FOR THE
SECOND CIRCUIT

E.D.N.Y. - Bklyn 09-cv-4888 Gershon, J.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York, on the 21st day of April, two thousand ten,

Present:

Roger J. Miner, José A. Cabranes, Richard C. Wesley,
Circuit Judges.

ACORN, et al., v.

Plaintiffs-Appellees,

United States of America, et al., Defendants-Appellants.

09-5172-cv (L) 10-992-cv (Con)

Appellants move for an emergency stay pending appeal of the district court order granting the Appellees a declaratory judgment declaring certain acts of Congress unconstitutional under the Bill of Attainder Clause and permanently enjoining the Government from enforcing those acts. Upon due consideration, it is hereby ORDERED that the motion is GRANTED and the appeal is EXPEDITED. The Appellant’s brief is due April 30, 2010. Appellee’s brief is due by May 14, 2010. Appellant’s reply brief is due by May 24, 2010. Oral argument shall be scheduled for shortly thereafter.
FOR THE COURT: Catherine O’Hagan Wolfe, Clerk

SAO-JW

 
 MANDATE Case 1:09-cv-04888-NG -LB Document 64 Filed 12/17/10 Page 1 of 1 UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

At a Stated Term of the United States Court of Appeals for the Second Circuit, held at the
Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York, on the 131h day of August, two thousand and ten.

PRESENT:

ROGER J. MINER, JOSE A. CABRANES, RICHARD C. WESLEY,
Circuit Judges.

ACORN, ACORN Institute, Inc., and MHANY Management, Inc., f!kla New York Acorn Housing Company, Inc.,
Plainti ffs-Appellees,

- v. -

JUDGMENT

Docket No. 09-5 I72-cv (L)

I0-0992-cv (CON)

United States of America, Shaun Donovan, Secretary of the

Department of Housing and Urban Development, Peter Orszag,

Director Office of Management and Budget, Timothy R. Geithner

Jr., Secretary of the Department of Treasury of the United States,

Lisa P. Jackson, Administrator of the Environmental Protection

Agency; Gary Locke, Secretary of Commerce; and Robert Gates,

Secretary of Defense.

Defendants-Appellants.

The appeals in the above-captioned case from the United States District Court for the Eastern District of New York was argued on the district court record and the parties' briefs. Upon consideration thereof,

IT IS HEREBY ORDERED, ADJUDGED and DECREED that the judgment of the District Court is AFFIRMED in part and VACATED in part, and the case is REMANDED for further proceedings as to the plaintiffs' First Amendment and due process claims.

A True Copy Catherine O'Hagan United States

FOR THE COURT, Catherine O'Hagan Wolfe, Clerk

Joy Fallek, Administrative Attorney
MANDATE ISSUED ON 12/17/2010

 
 Case 1:09-cv-04888-NG-LB Document 66 Filed 05/09/11 Page 1 of 2 PageID #: 1611

1'1"':.~' centerforconstitutionalrights

\!(, "

on the front lines for social justice

April 28, 20 It
Filed Via ECF Hon. Nina Gershon United States District Court Eastern District of New York 225 Cadman Plaza East Brooklyn, NY 1120 I
Re: ACORNv. USA, 09-CV-4888 (NG)
Dear Judge Gershon:
As counsel for the parties in the above-entitled action, we write jointly to update the Court on the current status of the case.
As Your Honor is aware, Defendants appealed the Court's March 10, 2010 decision granting Plaintiffs a declaratory judgment and permanent injunction on their Bill of Attainder claim to the United States Court of Appeals for the Second Circuit. On August 13, 20 I0, a three· judge panel of the Second Circuit vacated the declaratory judgment and permanent injunction and remanded the case to this Court to resolve Plaintiffs' First Amendment and due process claims. See ACORNv. United States, 618 F.3d 125 (2d Cir. 2010). Thereafter, Plaintiffs petitioned the Second Circuit for an en bane rehearing, and on November 23, 2010 the Second Circuit issued an order denying the petition. See Exhibit A.
On February 22, 2011, Plaintiffs timely filed a petition for a writ of certiorari with the United States Supreme Court. On March 24, 2011, the United States Solicitor General's Office was granted a 30-day extension of time to file an opposition to Plaintiffs' certiorari petition, and earlier today it requested an additional extension to May 20, 2011. Even if this additional extension request is granted, Plaintiffs anticipate that the Supreme Court will rule on Plaintiffs' certiorari petition before it begins its summer recess in June 2011.
Accordingly, Plaintiff's respectfully request that this Court stay any further proceedings in this case until after the Supreme Court has ruled on Plaintiffs' certiorari petition. After that ruling, the parties will confer and advise the Court about how they wish to proceed. Defendants do not oppose Plaintifts' request.

666 broadway, 7 f!, new york, ny 10012 t 212 614 6464 !212 614 6499 www.CCRjustice.org
~

Case 1:09-cv-04888-NG-LB Document 66 Filed 05/09/11 Page 2 of 2 PageID #: 1612
Thank you for your time and consideration. Respectfully submitted, \s\ Darius Charney Center for Constitutional Rights Counsel for PlaintiffS \s\ Peter Leary United States Department of Justice Civil Division, Federal Programs Branch Counselfor Defendants
Encl. Cc: All Counsel (via ECF)
2

 
 Case 1:09-cv-04888-NG-LB Document 68 Filed 07/12/11 Page 1 of 1 PageID #: 1614
Case 1:09-cv-04888-NG -LB Document 67 Filed 07/06/11 Page 1 of 1

centerforconstitutional , l:ts

on the front lines for social justice

Filed Via ECF Hon. Nina Gershon United States District Court Eastern District of New York 225 Cadman Plaza East Brooklyn, NY 1120 I

July 6, 2011

FIEIU:ED
* * US tIlNiCSlTlaiii!SRTltR5l1O0Ue8~1t~'ff~CiEJ N.Y. -/.» _.. "" . ..: .!01~

Dear Judge Gershon:

Rc: ACORN v. United States, 09-CV-4888

Following up on the parties' letter to Your Honor of April 28, 2011 (Dkt # 65), we write to update the Court on the current status of the above-captioned case and to advise the Court of how the parties wish to proceed.

As the Court may be aware, on June 20, 2011, the United States Supreme Court denied Plaintiffs' petition for a writ of certiorari to review the Second Circuit's August 13, 2010 decision reversing this Court's granting of a declaratory judgment and permanent injunction in Plaintiffs' favor on their bill of attainder claim. Plaintiffs' counsel will therefore need to confer with our clients to determine if they wish to proceed with their remaining First Amendment and Due Process claims in this Court. In addition, because two of the three Plaintiffs (ACORN and Acorn Institute) are currently in bankruptcy proceedings, Plaintiffs' counsel will need to request and obtain the permission of the bankruptcy trustee to continue to prosecute this case on their behalf. Thus, Plaintiffs' counsel anticipate that we will need about 2-3 weeks to resolve these questions, at which point we will advise the Court in writing of Plaintiffs' intentions.

Counsel for the parties have conferred, and plaintiffs respectfully request that the Court continue to stay any further proceedings in this case until August 1, 2011. Federal Defendants do not oppose this request. On or before August I, the parties will advise the Court in writing as to whether the case will proceed in this Court and, and if so, will endeavor to submit a joint proposed schedule for resolving the remaining claims.

Respectfully submitted,

s/NG

\s\ Darius Charney Center for Constitutional Rights Attorneys for Plaintiffs

\s\ Peter Leary United States Department of Justice Attorneys for Defendants

-

666 broadway, 7 fl, new york, ny 10012

t :'.12 Cil·i c1f34 f 7.:?. b!!, 64:19 www.CCRjustice.org

 
 Case 1:09-cv-04888-NG-LB Document 70 Filed 08/03/11 Page 1 of 3 PageID #: 1618
Cas<? 1 :09-cv-04888-NG-LB Document 69 Filed 08/01/11 Page 1 of 3 Page/D tt: 1615
. ·.• . ,.,
; ·:

UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF NEW YORK
---------- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -X

ASSOCIATION OF COMMUNITY ORGANIZATIONS FOR REFORM NOW, et al.,

Civil Action No. 09-CV-4888 (NG)

Plaintiffs, vs. UNITED STATES OF AMERICA, et al ..

(Gershon, J.) (Bloom, M.J.)

Defendants.
- - - - - - --- - - - -- - - - - - - - - --- - - - - - -- -- - - - - - -- -X

STIPULATION OF DISMISSAL WITH PREJUDICE WHEREAS, plaintiffs state that ACORN and ACORN INSTITUTE are currently in

bankruptcy proceedings, and the U.S. Department of Housing and Urban Development previously

detem1ined that plaintiff MHANY is not an affiliate, subsidiary or allied organization of ACORN,

and WHEREAS, plaintiffs state that in light of the aforementioned facts, they do not desire to

continue the present action; NOW, THEREFORE. IT IS HEREBY STIPULATED AND AGREED: Pursuant to Federal Rule of Civil Procedure 41 (a)( I)(A)(ii), the parties hereby jointly

stipulate to the dismissal of this action with prejudice. The parties will bear their own costs and fees.

Dated: August I, 20 II

Respectfully Submitted,

\s\ Darius Charney DARIUS CHARNEY (DC 1619) 666 Bmadway, 7th Floor New York, NY 10012

TONY WEST Assistant Attorney General IAN HEATH GERSHENGORN Deputy Assistant Attorney General

Case 1:09-cv-04888-NG-LB Document 70 Filed 08/03/11 Page 2 of 3 PageID #: 1619
Case 1:09-cv-04888-NG-LB Document 69 Filed 08/01/11 Page 2 of 3 PageiD ll 1616

Tel: 212-614-6475 Fax: 212-614-6499 Cent ~r for Constitutional Rights
CCR cooperating attorneys:
Jules Lobel (JL8780) 3900 Forbes Avenue Pittsturgh, PA 15260
Goodman & Hurwitz, P.C. William Goodman (WG 1241) Julie H. Hurwitz 1394 East Jefferson Detroit, Michigan 48207 313.557.6170
Arthur Z. Schwartz (AZ52683) 275 S ~venth A venue New York, NY I 000 I
Atton eysfor Plaintiffs

LORETTA E. LYNCH United States Attorney
lsi Peter D. Leary PETER D. LEARY, Virginia Bar#71196 MICHAEL SITCOV, D.C. Bar# 308682 BRADLEY H. COHEN, D.C. Bar#495145 U.S. Department of Justice Civil Division, Federal Programs Branch 20 Massachusetts Ave.. N.W. Room 7322 P.O. Box 883 Washington, D.C. 20044 (202) 514-3313 (202) 616-8470 (fax) Email: Peter. Leary@ usdoj.gov
Attorneys for Defendants

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 Case: 1:09-cv-04888-NG-LB As of: 06/18/2012 09:38 AM EDT 1 of 9
U.S. District Court Eastern District of New York (Brooklyn) CIVIL DOCKET FOR CASE #: 1:09−cv−04888−NG−LB

CLOSED

Acorn et al v. United States of America et al Assigned to: Judge Nina Gershon Referred to: Magistrate Judge Lois Bloom Cause: 28:2201 Injunction Plaintiff Acorn
Plaintiff Acorn Institute, Inc.
Plaintiff New York Acorn Housing Company, Inc.

Date Filed: 11/12/2009 Date Terminated: 08/03/2011 Jury Demand: None Nature of Suit: 440 Civil Rights: Other Jurisdiction: U.S. Government Defendant
represented by Darius Charney Center for Constitutional Rights 666 Broadway, 7th Floor New York, NY 10012 212−614−6464 Fax: 212−614−6499 Email: dcharney@ccrjustice.org ATTORNEY TO BE NOTICED
represented by Darius Charney (See above for address) ATTORNEY TO BE NOTICED
represented by Darius Charney (See above for address) ATTORNEY TO BE NOTICED

V. Defendant United States of America

represented by Peter D. Leary Department of Justice 20 Massachusetts Avenue, Nw Room 7322 Washington, DC 20530 (202)514−3313 Fax: (202)616−8470 Email: peter.leary@usdoj.gov LEAD ATTORNEY ATTORNEY TO BE NOTICED
Bradley H Cohen US Dept of Justice − Fed Programs 20 Massachusetts Ave Nw Rm 7338 Washington, DC 20001 202−305−9855 Fax: 202−318−0486 Email: bradley.cohen@usdoj.gov ATTORNEY TO BE NOTICED
Farzin Franklin Amanat United States Attorneys Office Eastern District of New York 271 Cadman Plaza East Brooklyn, NY 11201−1820 (718) 254−6024

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Fax: (718)254−6081 Email: franklin.amanat@usdoj.gov ATTORNEY TO BE NOTICED

Defendant
Shaun Donovan Secretary of the Department of Housing and Urban Development

represented by Peter D. Leary (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED

Bradley H Cohen (See above for address) ATTORNEY TO BE NOTICED

Farzin Franklin Amanat (See above for address) ATTORNEY TO BE NOTICED

Defendant
Peter Orszag Directorm Office of Management and Budget

represented by Peter D. Leary (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED

Bradley H Cohen (See above for address) ATTORNEY TO BE NOTICED

Farzin Franklin Amanat (See above for address) ATTORNEY TO BE NOTICED

Defendant
Timothy Geithner Secretary of the Department of Treasury of the United States

represented by Peter D. Leary (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED

Bradley H Cohen (See above for address) ATTORNEY TO BE NOTICED

Farzin Franklin Amanat (See above for address) ATTORNEY TO BE NOTICED

Intervenor
Christopher Earl Strunk TERMINATED: 03/09/2010

Date Filed 11/12/2009
11/12/2009

# Docket Text
1 COMPLAINT against Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America Disclosure Statement on Civil Cover Sheet completed −No,, filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Civil Cover Sheet, # 2 Exhibit Part 1, # 3 Exhibit Part 2, # 4 Exhibit Part 3, # 5 Exhibit Part 4, # 6 Exhibit Part 5, # 7 Exhibit Part 6) (Davis, Kimberly) (Entered: 11/12/2009)
FILING FEE: $ 350.00, receipt number 4653007581 (Davis, Kimberly) (Entered: 11/12/2009)

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11/12/2009 11/12/2009 11/13/2009
11/16/2009 11/16/2009 11/25/2009 12/01/2009 12/03/2009 12/04/2009 12/11/2009

2 DISCLOSURE of Interested Parties by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Davis, Kimberly) (Entered: 11/12/2009)
Summons Issued as to Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Davis, Kimberly) (Entered: 11/12/2009)
5 Minute Entry for proceedings held before Senior Judge Nina Gershon:Civil Cause for Preliminary Injunction held on 11/13/2009. Counsel for parties present. Plaintiffs' application for a temporary restraining order was denied on the record. The govt's papers shall be served by 1 PM on 12/1/09; Pltf's response shall be served and filed by 1 PM 12/4/09; Hearing set for 12/4/2009 at 11:00 AM in Courtroom 6D South before Senior Judge Nina Gershon. (Fernandez, Erica) (Entered: 11/20/2009)
3 NOTICE of Appearance by Peter D. Leary on behalf of Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America (aty to be noticed) (Leary, Peter) (Entered: 11/16/2009)
4 NOTICE of Appearance by F. Franklin Amanat on behalf of Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America (aty to be noticed) (Amanat, F.) (Entered: 11/16/2009)
6 NOTICE of Appearance by Bradley H Cohen on behalf of Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America (aty to be noticed) (Cohen, Bradley) (Entered: 11/25/2009)
7 MEMORANDUM in Opposition to Plaintiffs' Motion for Preliminary Injunction filed by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Exhibit, # 2 Exhibit, # 3 Exhibit) (Leary, Peter) (Entered: 12/01/2009)
8 REPLY in Support Plaintiffs' Motion for Preliminary Injunction filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Exhibit G−O) (Charney, Darius) (Entered: 12/03/2009)
27 Minute Entry for proceedings held before Senior Judge Nina Gershon:Preliminary Injunction Hearing held on 12/4/2009. Counsel for parties present. The Court's decision is reserved. (Court Reporter Michele Nardone.) (Fernandez, Erica) (Entered: 01/07/2010)
9 OPINION and ORDER. The plaintiffs have established a likelihood of success on the merits of their bill of attainder claim. They have also established the likelihood of irreparable harm absent an injunction and that issuance of a preliminary injunction is in the public interest. Therefore the plaintiffs motion for a preliminary injunction is GRANTED. A preliminary injunction in the following form shall issue:Defendants the UNITED STATES OF AMERICA; SHAUN DONOVAN, in his official capacity as Secretary of the Department of Housing and Urban Development; PETER ORSZAG, in his official capacity as Director of the Office of Management and Budget; and TIMOTHY GEITHNER, in his official capacity as Secretary of the Department of Treasury of the United States; and all those acting in concert with them, are herebyENJOINED, during the pendency of this action, from enforcing Section 163 of Division B Continuing Appropriations Resolution, 2010, Pub. L. No. 111−68, § 163, 123 Stat. 2023, 2053 (2009), as renewed by Division B Further Continuing Appropriations Resolution, 2010, Pub. L. No. 111−88, § 101, 123 Stat. 2904, 2972 (2009), which provides that None of the funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now (ACORN), or any of its affiliates, subsidiaries, or allied organizations. The defendants are hereby furtherENJOINED, during the pendency of this action, from enforcing the Office ofManagement and Budget Memorandum, entitled Memorandum for the Heads ofExecutive Departments and Agencies providing [g]uidance on [S]ection 163 ofthe Continuing Resolution regarding the Association of CommunityOrganizations for Reform Now (ACORN), dated October 7, 2009. Ordered by Senior Judge Nina Gershon on 12/11/2009. (Vaughn, Terry) (Entered: 12/11/2009)

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12/11/2009
12/16/2009 12/16/2009 12/16/2009 12/16/2009 12/17/2009 12/17/2009 12/17/2009 12/17/2009 12/17/2009
12/17/2009 12/18/2009 12/18/2009

10 PRELIMINARY INJUNCTION. Defendants the UNITED STATES OF AMERICA; SHAUN DONOVAN, in his official capacity as Secretary of the Department of Housing and Urban Development; PETER ORSZAG, in his official capacity as Director of the Office of Management and Budget; and TIMOTHY GEITHNER, in his official capacity as Secretary of the Department of Treasury of the United States; and all those acting in concert with them, are hereby enjoined as directed in this Preliminary Injunction. Ordered by Senior Judge Nina Gershon on 12/11/2009. (Vaughn, Terry) (Entered: 12/11/2009)
11 MOTION for Reconsideration by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Exhibit) (Leary, Peter) (Entered: 12/16/2009)
12 NOTICE OF APPEAL by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Leary, Peter) (Entered: 12/16/2009)
13 NOTICE by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America (Leary, Peter) (Entered: 12/16/2009)
23 Letter dated 12/15/09 from Christopher−Earl to Judge Gershon requesting a premotion conference. (see letter for details) (Fernandez, Erica) (Entered: 12/22/2009)
14 AMENDED COMPLAINT against Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America, filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Exhibit G) (Charney, Darius) (Entered: 12/17/2009)
15 MOTION to Amend/Correct/Supplement 10 Preliminary Injunction,, 9 Memorandum &Opinion,,,,,,, by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Charney, Darius) (Entered: 12/17/2009)
16 Unsigned Order to Show Cause for Preliminary Injunction by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc. (Charney, Darius) (Entered: 12/17/2009)
17 DECLARATION re 16 Unsigned Order to Show Cause Certificate of Compliance by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc. (Charney, Darius) (Entered: 12/17/2009)
18 By motion dated December 16, 2009, defendants move for reconsideration of this courts December 11, 2009, opinion and order granting plaintiffs motion for a preliminary injunction. In the alternative, defendants seek amendment of the injunction. Plaintiffs, on December 17, 2009, submitted an amended complaint. Plaintiffs also seek modification of the preliminary injunction. Defendants are directed to file their response to plaintiffs motion by 5:00 PM on December 18, 2009. Plaintiffs are directed to respond to defendants motion by the same date and time. The parties are directed to appear for a hearing on their motions on Tuesday, December 22, 2009, at 2:30 PM, in Courtroom 6D South, 225 Cadman Plaza East, Brooklyn, New York. Ordered by Senior Judge Nina Gershon on 12/17/2009. (Ehrlich, Julie) (Entered: 12/17/2009)
19 AMENDED COMPLAINT CORRECTED against Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America, filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Exhibit G) (Charney, Darius) (Entered: 12/17/2009)
20 MEMORANDUM in Opposition re 11 MOTION for Reconsideration filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C) (Charney, Darius) (Entered: 12/18/2009)
Electronic Index to Record on Appeal sent to US Court of Appeals. For docket entries without a hyperlink, contact the court and we'll arrange for the document(s) to be made available to you. 13 Notice(Other), 6 Notice of Appearance, 20 Memorandum in Opposition, 10 Preliminary Injunction,, 15 Motion to Amend/Correct/Supplement, 18 Order,,, 11 Motion for Reconsideration, 1 Complaint, 7 Memorandum in Opposition, 17 Declaration, 8 Reply in Support, 4

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12/18/2009 12/21/2009
12/22/2009
12/22/2009
12/30/2009 01/12/2010 01/12/2010 01/13/2010 01/20/2010 01/20/2010 01/21/2010

Notice of Appearance, 12 Notice of Appeal, 2 Disclosure of Interested Parties, 14 Amended Complaint, 3 Notice of Appearance, 19 Amended Complaint, 5 Status Conference, Set Hearings,, 9 Memorandum &Opinion,,,,,,, 16 Unsigned Order to Show Cause (Gonzalez, Mary) (Entered: 12/18/2009)
21 RESPONSE in Opposition re 15 MOTION to Amend/Correct/Supplement 10 Preliminary Injunction,, 9 Memorandum &Opinion,,,,,,, filed by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Exhibit, # 2 Exhibit, # 3 Exhibit, # 4 Exhibit) (Leary, Peter) (Entered: 12/18/2009)
22 Letter from F. Franklin Amanat, counsel for defendants, to Judge Gershon, in response/opposition to the letter from Christopher Earl Strunk (a pro se non−party to the action) requesting a premotion conference in connection with his planned motion for leave to intervene as a defendant in this action pursuant to Fed. R. Civ. P. 24, by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America (Amanat, F.) (Entered: 12/21/2009)
24 MEMORANDUM AND ORDER directing that defendants motion for reconsideration is denied. For reasons stated on the record, the alternative application to strike the United States from the preliminary injunction is also denied. Finally, plaintiffs motion to modify or amend the preliminary injunction is denied without prejudice as described on the record. Ordered by Senior Judge Nina Gershon on 12/22/2009. (Fernandez, Erica) (Entered: 12/22/2009)
26 Minute Entry for proceedings held before Senior Judge Nina Gershon:Motion Hearing held on 12/22/2009 re 15 MOTION to Amend/Correct/Supplement 10 Preliminary Injunction, and 9 Memorandum &Opinion,filed by New York Acorn Housing Company, Inc., Acorn, Acorn Institute, Inc; 11 MOTION for Reconsideration; Parties agreed to the following motion schedule: The Govt shall file its objection paper two weeks from the date the plaintiffs serves their motion for a preliminary injunction. A reply shall be served and filed a week from that date.(Court Reporter Victoria Butler.) (Fernandez, Erica) (Entered: 01/07/2010)
25 MOTION to Vacate the Court's December 11, 2009 Injunction and Order by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Exhibit) (Leary, Peter) (Entered: 12/30/2009)
28 MOTION for Permanent Injunction ( Responses due by 2/10/2010), MOTION for Preliminary Injunction, MOTION for Declaratory Judgment ( Responses due by 2/10/2010), MOTION to Amend/Correct/Supplement Complaint by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Charney, Darius) (Entered: 01/12/2010)
29 MEMORANDUM in Support re 28 MOTION for Permanent Injunction MOTION for Preliminary Injunction MOTION for Declaratory Judgment MOTION to Amend/Correct/Supplement Complaint filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Charney, Darius) (Entered: 01/12/2010)
30 MEMORANDUM in Opposition re 25 MOTION to Vacate the Court's December 11, 2009 Injunction and Order filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Charney, Darius) (Entered: 01/13/2010)
31 REPLY in Support of Defendants' Motion to Vacate the Court's December 11, 2009 Injunction and Order filed by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Leary, Peter) (Entered: 01/20/2010)
34 NOTICE of Motion to Intervene as a Ex−Relator−Intervener−Defendant USA Citizen and State of New York Citizen filed by Christopher Earl (pro se non party to this action) (Fernandez, Erica) (Entered: 01/26/2010)
32 ORDER directing that pursuant to FRCP 65(a)(2), Plaintiffs' motion for preliminary injunction is consolidated with their motions for a permanent injunction and declaratory judgment; Ordered that Defendants shall file and serve their response to Plaintiffs' consolidated motion by no later than 6:00 PM on 2/2/2010, and that Plaintiffs shall file and serve their reply papers in support of their consolidated motion by no later than 6:00 PM on 2/9/2010; Ordered that Plaintiffs' motion for leave to file a second amended complaint in this action is

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01/25/2010 01/26/2010 01/28/2010 01/29/2010 02/02/2010
02/03/2010 02/09/2010 02/09/2010 02/09/2010
02/09/2010 02/22/2010 02/22/2010

GRANTED. Ordered by Senior Judge Nina Gershon on 1/20/2010. (Fernandez, Erica) (Entered: 01/21/2010)
33 AMENDED COMPLAINT Second Amended Complaint for Injunctive and Declaratory Relief against Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America, filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Exhibit H) (Charney, Darius) (Entered: 01/25/2010)
35 ORDER directing parties to respond to "Notice of Motion to Intervene" 34 Ordered by Senior Judge Nina Gershon on 1/26/2010. (Mask, Deirdre) (Entered: 01/26/2010)
36 Letter Regarding Omitted Exhibit to Plaintiffs' Motion for Declaratory Judgment and Preliminary and Permanent Injunction by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc. (Charney, Darius) (Entered: 01/28/2010)
37 ORDER re 36 directing plaintiffs to submit courtesy paper copies of each of its exhibits contained on the CD submitted at the time of filing. Ordered by Senior Judge Nina Gershon on 1/29/2010. (Mask, Deirdre) (Entered: 01/29/2010)
38 MEMORANDUM in Opposition to Plaintiffs' Motion and in Support of Defendants' Cross−Motion to Dismiss and for Summary Judgment filed by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Notice of Motion, # 2 Rule 56.1 Statement, # 3 Exhibit Index of Exhibits, # 4 Exhibit, # 5 Exhibit, # 6 Exhibit, # 7 Exhibit, # 8 Exhibit, # 9 Exhibit, # 10 Exhibit, # 11 Exhibit, # 12 Exhibit, # 13 Exhibit, # 14 Exhibit, # 15 Exhibit, # 16 Exhibit, # 17 Exhibit, # 18 Exhibit, # 19 Exhibit, # 20 Exhibit, # 21 Exhibit, # 22 Exhibit, # 23 Exhibit, # 24 Exhibit, # 25 Exhibit, # 26 Exhibit, # 27 Exhibit, # 28 Exhibit, # 29 Exhibit, # 30 Exhibit, # 31 Exhibit) (Leary, Peter) (Entered: 02/02/2010)
39 Notice of MOTION for Summary Judgment and Cross Motion to Dismiss by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Proposed Order) (Leary, Peter) (Entered: 02/03/2010)
40 MEMORANDUM in Opposition re 34 Notice (Other) of Motion to Intervene by Pro Se Non Party Christopher Earl Strunk, filed by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Notice to Pro Se Litigant Pursuant to Local Civil Rule 7.1(c)) (Amanat, F.) (Entered: 02/09/2010)
41 MEMORANDUM in Opposition re 34 Notice (Other) Motion to Intervene by Non−Party Christopher Strunk filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Charney, Darius) (Entered: 02/09/2010)
42 REPLY in Support re 28 MOTION for Permanent Injunction MOTION for Preliminary Injunction MOTION for Declaratory Judgment MOTION to Amend/Correct/Supplement Complaint filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Exhibit List, # 2 Exhibit N, # 3 Exhibit O, # 4 Exhibit P, # 5 Exhibit Q) (Charney, Darius) (Entered: 02/09/2010)
43 RULE 56.1 STATEMENT re 39 Notice of MOTION for Summary Judgment and Cross Motion to Dismiss, 28 MOTION for Permanent Injunction MOTION for Preliminary Injunction MOTION for Declaratory Judgment MOTION to Amend/Correct/Supplement Complaint filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Charney, Darius) (Entered: 02/09/2010)
44 MOTION for Extension of Time to File a Local Civil Rule 56.1(b) Response by Timothy Geithner, Peter Orszag, United States of America. (Leary, Peter) (Entered: 02/22/2010)
ORDER granting 44 Motion for Extension of Time to File. Taking into consideration the unusual procedural circumstances in this case, Defendants' motion for an extension of time to March 1, 2010 to file their response to Plaintiffs' Rule 56.1 statement is granted. Ordered by Senior Judge Nina Gershon on 2/22/2010. (Mask, Deirdre) (Entered: 02/22/2010)

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02/25/2010 03/01/2010
03/01/2010 03/01/2010 03/02/2010 03/09/2010 03/10/2010
03/10/2010 03/17/2010
03/17/2010 03/18/2010 03/19/2010

45 MOTION for Leave to File Additional Affadavit in Support of Motion for Declaratory Judgment and Preliminary and Permanent Injunction by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Affidavit) (Charney, Darius) (Entered: 02/25/2010)
On consent, the plaintiff's application by letter dated February 25, 2010, requesting leave to file any Additional Affidavit of Ismene Speliotis in support of Plaintiffs Motion for a Declaratory Judgment and Preliminary and Permanent Injunction is granted. The defendant is granted leave to file any response by March 1, 2010. Ordered by Senior Judge Nina Gershon on 3/1/2010. (Joe, Victor) (Entered: 03/01/2010)
46 AFFIDAVIT/DECLARATION in Support re 28 MOTION for Permanent Injunction MOTION for Preliminary Injunction MOTION for Declaratory Judgment MOTION to Amend/Correct/Supplement Complaint Additional Affidavit of Ismene Speliotis filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Charney, Darius) (Entered: 03/01/2010)
47 RULE 56.1 STATEMENT Defendants' 56.1(b) Response to Plaintiffs' Statement of Material Facts filed by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Exhibit A, # 2 Exhibit B) (Leary, Peter) (Entered: 03/01/2010)
48 Letter to Defense Counsel re the Dissolution of Acorn by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc. (Charney, Darius) (Entered: 03/02/2010)
49 ORDER re 34 Notice of Motion to Intervene by Christopher Earl Strunk; Therefore, he has not met the requirements for either intervention as of right under Fed.R.Civ.P.24(a) or for permissive intervention under Fed.R.Civ.P.24(b). The motion is denied. Ordered by Senior Judge Nina Gershon on 3/8/2010. (Fernandez, Erica) (Entered: 03/09/2010)
50 OPINION AND ORDER directing that Plaintiffs have prevailed on their bill of attainder claim. They have also established irreparable harm and the need for both declaratory and injunctive relief. Therefore plaintiffs' motion for declaratory relief and a permanent injunction is GRANTED 28 . The government's "cross−motion to dismiss and for summary judgment" is DENIED 39 . The government's motion to vacate ACORN I is DENIED 25 . Ordered by Senior Judge Nina Gershon on 3/10/2010. (Fernandez, Erica) (Entered: 03/10/2010)
51 DECLARATORY JUDGMENT AND PERMANENT INJUNCTION. Ordered by Senior Judge Nina Gershon on 3/10/2010. (Fernandez, Erica) (Entered: 03/10/2010)
52 NOTICE OF APPEAL as to 50 Order on Motion to Vacate, Order on Motion for Permanent Injunction, Order on Motion for Preliminary Injunction, Order on Motion for Declaratory Judgment, Order on Motion to Amend/Correct/Supplement, Order on Motion for Summary Judgment,,,,,,,,,,,, 51 Judgment, Permanent Injunction by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America.No fee. Service done electronically. (Cohen, Bradley) Modified on 3/18/2010 (McGee, Mary Ann). (Entered: 03/17/2010)
53 MOTION to Stay Declaratory Judgment and Permanent Injunction Pending Appeal, or in the Alternative, for a Temporary Administrative Stay by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Cohen, Bradley) (Entered: 03/17/2010)
Electronic Index to Record on Appeal sent to US Court of Appeals 52 Notice of Appeal, 53 Motion to Stay. PLEASE NOTE: The documents in this case are online and may be downloaded. (McGee, Mary Ann) (Entered: 03/18/2010)
The court is in receipt of defendants motion to stay the declaratory judgment and permanent injunction pending appeal 53 . Plaintiffs are directed to respond by March 26, 2010. Ordered by Senior Judge Nina Gershon on 3/19/2010. (Mask, Deirdre) (Entered: 03/19/2010)

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03/26/2010 03/30/2010 03/31/2010 04/02/2010
04/06/2010 04/07/2010 04/08/2010 04/09/2010 04/13/2010 04/22/2010
04/29/2010 05/17/2010

54 MEMORANDUM in Opposition re 53 MOTION to Stay Declaratory Judgment and Permanent Injunction Pending Appeal, or in the Alternative, for a Temporary Administrative Stay filed by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C) (Charney, Darius) (Entered: 03/26/2010)
55 REPLY in Support re 53 MOTION to Stay Declaratory Judgment and Permanent Injunction Pending Appeal, or in the Alternative, for a Temporary Administrative Stay and Response to Plaintiffs' Cross−Motion filed by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Attachments: # 1 Declaration) (Cohen, Bradley) (Entered: 03/30/2010)
56 ORDER denying 53 Motion to Stay. Ordered by Senior Judge Nina Gershon on 3/31/2010. (Mask, Deirdre) (Entered: 03/31/2010)
57 ORDER of USCA as to 12 Notice of Appeal filed by Timothy Geithner, Shaun Donovan, Peter Orszag, United States of America, 52 Notice of Appeal, filed by Timothy Geithner, Shaun Donovan, Peter Orszag, United States of America. It is Ordered that the motion of the Government for an administrative stay pending resolution of its motion for further stay pending resolution of its appeal from the Order of the District Court is granted. Appellees are granted until Monday morning 4/5/10 at 10:00 a.m. to file a response to the Government's motion. The motion for a stay pending appeal will be determined by a three−judge motions panel as soon as possible. The parties are directed to confer and present the Court on Monday at 10:00 a.m. with either agreed dates for briefing of an expedited appeal, or competing proposals for such a schedule. Certified: 4/2/10. USCA#10−992. (McGee, Mary Ann) (Entered: 04/02/2010)
58 NOTICE OF APPEAL as to 49 Order. Christopher Earl Strunk, self−represented Petitioner for Intervention as a Defendant, appeals from Order of 3/8/10. No fee paid. Mr. Strunk via telephone notified of filing fee. Also notified that to have an expedited appeal it is necessary to motion the USCA. Service done electronically. (McGee, Mary Ann) (Entered: 04/07/2010)
Electronic Index to Record on Appeal sent to US Court of Appeals 58 Notice of Appeal. Please note: The documents in this case are online and may be downloaded. (McGee, Mary Ann) (Entered: 04/07/2010)
59 MOTION for Extension of Time to File Attorneys Fees Application by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc.. (Charney, Darius) (Entered: 04/08/2010)
Plaintiffs' 59 Motion for Extension of Time to File is "so ordered." Ordered by Senior Judge Nina Gershon on 4/9/2010. (Mask, Deirdre) (Entered: 04/09/2010)
60 MOTION for Leave to Appeal in forma pauperis by Christopher Earl Strunk. (McGee, Mary Ann) (Main Document 60 replaced on 4/20/2010) (Fernandez, Erica). (Entered: 04/19/2010)
61 RESPONSE in Opposition re 60 MOTION for Leave to Appeal in forma pauperis : Letter from AUSA F. Franklin Amanat, on behalf of all defendants, respectfully asking the Court to deny Strunk's application for IFP status and to make a formal finding that any appeal from 49 this Court's March 9, 2010, Order denying intervention would not be taken in good faith, filed by Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America. (Amanat, F.) (Entered: 04/22/2010)
62 ORDER denying 60 Motion for Leave to Appeal in forma pauperis. Ordered by Senior Judge Nina Gershon on 4/27/2010. (Sica, Michele) (Entered: 04/29/2010)
First Supplemental Electronic Index to Record on Appeal sent to US Court of Appeals. For docket entries without a hyperlink, contact the court and we'll arrange for the document(s) to be made available to you. 59 Motion for Extension of Time to File, 60 Motion for Leave to Appeal in forma pauperis, 62 Order on Motion for Leave to Appeal in forma pauperis, 61 Response in Opposition to Motion, (McGee, Mary Ann) (Entered: 05/17/2010)

Case: 1:09-cv-04888-NG-LB As of: 06/18/2012 09:38 AM EDT 9 of 9

06/28/2010 06/29/2010 12/17/2010
04/28/2011 05/09/2011 07/06/2011 07/12/2011 08/01/2011 08/03/2011

63 MANDATE of USCA as to 58 Notice of Appeal filed by Christopher Strunk. A NOA was filed on 4/6/10. The Fee was due on 4/6/10. It is Ordered that the appeal is dismissed effective 5/5/10. Mandate issued on 6/28/10. (Gonzalez, Mary) (Entered: 06/29/2010)
Incorrect Entry Information. Please be advised the Notice of Appeal that was linked to this USCA Mandate was incorrect. It will be corrected on the next entry. (Gonzalez, Mary) (Entered: 06/29/2010)
64 MANDATE of USCA as to 52 Notice of Appeal, filed by Timothy Geithner, Shaun Donovan, Peter Orszag, United States of America. It is Ordered that the judgment of the District Court is affirmed in part and vacated in part. Remanded for further proceedings as to the Pltffs' First Amendment and due process claims. Issued as Mandate: 12/17/10. USCA#10−0992−cv. Chambers notified. (McGee, Mary Ann) (Entered: 12/17/2010)
65 Letter Updating the Court on the Status of the Case by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc. (Charney, Darius) (Entered: 04/28/2011)
66 ORDER re 65 ; Plaintiffs request that this Court stay any further proceedings in this case until after the Supreme Court has ruled on Plaintiffs' certiorari petition; Application granted. Ordered by Senior Judge Nina Gershon on 5/2/2011. (Fernandez, Erica) (Entered: 05/09/2011)
67 Letter to the Court Providing Case Status Update by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc. (Charney, Darius) (Entered: 07/06/2011)
68 ORDER re 67 : Plaintiffs request that the Court continue to stay any further proceedings in this case until August 1, 2011. So Ordered by Senior Judge Nina Gershon on 7/8/2011. (Fernandez, Erica) Modified on 7/13/2011 to correct Judge (Fernandez, Erica). (Entered: 07/12/2011)
69 STIPULATION of Dismissal by Acorn, Acorn Institute, Inc., New York Acorn Housing Company, Inc. (Charney, Darius) (Entered: 08/01/2011)
70 STIPULATION AND ORDER DISMISSING CASE: IT IS HEREBY STIPULATED AND AGREED:Pursuant to Federal Rule of Civil Procedure 41(a)(I)(A)(ii), the parties hereby jointly stipulate to the dismissal of this action with prejudice. The parties will bear their own costs and fees. Ordered by Senior Judge Nina Gershon on 8/1/2011. (Fernandez, Erica) (Entered: 08/03/2011)

 
 Judge Strikes Down Congressional Ban on Funding ACORN
March 10, 2010, New York, NY – Today, federal judge, for the second time, granted an injunction against Congress’ unconstitutional de-funding of the Association of Community Organizations for Reform Now (ACORN) to apply to federal budget provisions signed into law by President Obama in December 2009 and ordered the United State of America and several named agencies to rescind orders cutting off funding to ACORN and its affiliates and allies. A preliminary injunction was won in December 2009 in the Center for Constitutional Rights’ (CCR) case charging Congress with violating the U.S. Constitution’s protections against Bill of Attainders and the First and Fifth Amendments in several recurring resolutions. Today’s opinion extends that protection by ordering a permanent injunction and directing agency heads to disregard the provisions denying funding and to rescind the memos that implemented the Congressional action. We are pleased with the ruling made by Judge Nina Gershon today. That Congress passed a budget, signed by President Obama, days after federal judge ruled bills of attainder unconstitutional shows just how intent these lawmakers are to target this one organization while violating their right to due process and freedom of association by targeting affiliated and allied organizations, as well. This is a rebuke of the smear tactics of the far right.
Jules Lobel, CCR cooperating attorney who argued the case: This is why the Constitution contains a prohibition against Congress enacting a bill of attainder – to prevent Congress from acting as judge jury and executioner.
The new budget passed by Congress and signed by President Obama in December included three specific references targeting ACORN for de-funding. The plaintiffs are ACORN, the ACORN Institute, and the New York ACORN Housing Company. The suit is ACORN v. USA and was filed in federal court in the Eastern District of New York. Said CCR attorney Darius Charney, Members of Congress were found to have violated the Constitution by declaring an organization guilty of a crime and punishing it and its members without benefit of a trial, then underhandedly passed a new budget doing exactly the same thing. While this ruling may not be the end of the unfair targeting of ACORN, it is certainly a step in the right direction to protecting the fundamental right to due process. Today Court upheld the Constitution and the rule of law – the people will benefit from this exercise of our system of checks and balances.

The court’s ruling stated, “I can discern no non-punitive rationale for a Congressional ban on [ACORN] from federal funding (page 22).” “Defendant peter Orszag, in his official capacity as Director of the Office of Management and Budget, is hereby, permanently (1) enjoined from instructing or advising federal agencies to enforce any of the legislative provisions declared unconstitutional by this court;… (page 33)” For more information, go to our ACORN v. USA case overview page. Jules Lobel is lead counsel in the case; other counsel include CCR Legal Director Bill Quigley and CCR Staff Attorney Darius Charney; CCR Cooperating Attorneys Bill Goodman and Julie Hurwitz of Goodman & Hurwitz, Detroit, MI; and attorney Arthur Schwartz of New York. The Center for Constitutional Rights is dedicated to advancing and protecting the rights guaranteed by the United States Constitution and the Universal Declaration of Human Rights. Founded in 1966 by attorneys who represented civil rights movements in the South, CCR is a nonprofit legal and educational organization committed to the creative use of law as a positive force for social change.

 
 General Docket Court of Appeals, 2nd Circuit
Court of Appeals Docket #: 10-992 Nature of Suit: 1440 CIVIL RIGHTS-Other Acorn v. United States of America Appeal From: EDNY (BROOKLYN) Fee Status: Waived
Case Type Information: 1) Civil 2) United States 3) -

Docketed: 03/18/2010

Originating Court Information:

District: 0207-1 : 09-cv-4888

Trial Judge: Nina Gershon, -

Date Filed: 11/12/2009

Date Order/Judgment:

Date NOA Filed:

03/10/2010

03/17/2010

Date Rec'd COA: 03/18/2010

Prior Cases: None

Current Cases: None
Panel Assignment: Not available

Acorn Plaintiff - Appellee

Darius Charney, Attorney Direct: 212-614-6475 [COR LD NTC Retained] Center for Constitutional Rights 7th Floor 666 Broadway New York, NY 10012

Acorn Institute, Inc. Plaintiff - Appellee

Darius Charney, Attorney Direct: 212-614-6475 [COR LD NTC Retained] (see above)

New York Acorn Housing Company, Inc. Plaintiff - Appellee
------------------------------

Darius Charney, Attorney Direct: 212-614-6475 [COR LD NTC Retained] (see above)

United States of America Defendant - Appellant

Helen L. Gilbert, Trial Attorney Direct: 202-514-4826 [COR LD NTC US Attorney] United States Department of Justice Civil Division 7261 950 Pennsylvania Avenue, N.W. Washington, DC 20530

Shaun Donovan, Secretary of the Department of Helen L. Gilbert, Trial Attorney

Housing and Urban Development

Direct: 202-514-4826

Defendant - Appellant

[COR LD NTC US Attorney]

(see above)

Peter Orszag, Director Office of Management Helen L. Gilbert, Trial Attorney

and Budget

Direct: 202-514-4826

Defendant - Appellant

[COR LD NTC US Attorney]

(see above)

Timothy Geithner, Secretary of the Department Helen L. Gilbert, Trial Attorney

of Treasury of the United States

Direct: 202-514-4826

Defendant - Appellant

[COR LD NTC US Attorney]

(see above)

FOR THE CAPTION AND A COMPLETE SET OF ATTORNEY LISTINGS PLEASE SEE THE LEAD DOCKET NUMBER 09-5172-cv

03/18/2010 1 NOTICE OF CIVIL APPEAL, and district court docket on behalf of Appellant

15 pg, 766.19

Shaun Donovan, Timothy Geithner, Peter Orszag and United States of

KB America, FILED. [16641] [10-992]

03/18/2010 2 DISTRICT COURT OPINION AND ORDER, dated 03/10/2010,

33 pg, 1.88 MB

RECEIVED.[16647]

[10-992]

03/18/2010 3 ELECTRONIC INDEX, in lieu of record, FILED.[16648] [10-992]
12 pg, 797.35 KB

03/29/2010 9 LETTER, dated 03/29/2010, on behalf of Appellant Shaun Donovan, Timothy

1 pg, 89.74

Geithner, Peter Orszag and United States of America, RECEIVED. Service

KB date 03/29/2010 by email, CM/ECF.[17949] [10-992]

03/29/2010 10 ATTORNEY, Helen L. Gilbert, in place of attorney Franklin F. Amanat, SUBSTITUTED.[17959] [10-992]

03/29/2010 11
3 pg, 83.15 KB

ACKNOWLEDGMENT AND NOTICE OF APPEARANCE FORM, on behalf of Appellant Shaun Donovan, Timothy Geithner, Peter Orszag and United States of America, FILED. Service date 03/29/2010 by CM/ECF.[17962] [10-992]

03/29/2010 12 FORM C, on behalf of Appellant Shaun Donovan, Timothy Geithner, Peter

55 pg, 1.07 MB

Orszag

and

United

States

of

America,

FILED.

Service

date

03/29/2010

by

CM/ECF.[17963] [10-992]

03/29/2010 13 FORM D, on behalf of Appellant Shaun Donovan, Timothy Geithner, Peter

1 pg, 91.75

Orszag and United States of America, FILED. Service date 03/29/2010 by

KB CM/ECF.[17965] [10-992]

03/29/2010 14 NOTICE OF APPEARANCE FORM, on behalf of Non-Party Filer <EDIT

1 pg, 28.86

Filer>, as additional counsel, FILED. Service date 03/29/2010 by CM/ECF.

KB [17966] [10-992]

03/31/2010 15 MOTION, stay, on behalf of Appellant Shaun Donovan, Timothy Geithner,

401 pg, 17.11

Peter Orszag and

United

States

of

America,

FILED. Service date

03/31/2010

MB by CM/ECF. [19038] [10-992]

04/02/2010 23 MOTION ORDER, granting motion to stay pending resolution filed by

1 pg, 21.16

Appellant United States of America, Shaun Donovan, Peter Orszag and

KB Timothy Geithner, 1, FILED. [19707][23] [10-992]

04/02/2010 24 CERTIFIED ORDER, dated 04/02/2010, to District Court for the Eastern

1 pg, 70.4 KB

District

of

New

York,

ISSUED.[19718]

[10-992]

04/02/2010 26 MOTION, to consolidate appeals, on behalf of Appellant Shaun Donovan,

6 pg, 96.49

Timothy Geithner, Peter Orszag and United States of America, FILED.

KB Service date 04/02/2010 by CM/ECF. [19831] [10-992]

04/05/2010 29 LETTER, dated 04/05/2010, on behalf of Appellant Shaun Donovan, Timothy

2 pg, 25.54

Geithner, Peter Orszag and United States of America, RECEIVED. Service

KB date 04/05/2010 by CM/ECF.[20007] [10-992]

04/05/2010 30 OPPOSITION TO MOTION [ 15 ], on behalf of Appellee Acorn, Acorn

200 pg, 10.39

Institute,

Inc. and New York Acorn Housing Company,

Inc., FILED.

Service

MB date 04/05/2010 by CM/ECF, email. [20035][30] [10-992]

04/05/2010 38 ARGUMENT/SUBMITTED NOTICE, to attorneys/parties,

1 pg, 28.8 KB

TRANSMITTED.[20293]

[10-992]

04/05/2010 41 MOTION ORDER, granting motion to consolidate appeals filed by Appellant

1 pg, 21.16

United States of America, Shaun Donovan, Peter Orszag and Timothy

KB Geithner, (GEL), FILED. [20356][41] [10-992]--[Edited 04/05/2010 by YL]

04/05/2010 42 CAPTION, to reflect consolidation with 09-5172-cv, AMENDED.[20360]

1 pg, 28.66

[10-992]

KB

04/05/2010 43 NOTE: See lead case, 09-5172-cv, containing complete set of docket entries.[20373] [10-992]

04/05/2010 44
1 pg, 21.16 KB

EXPEDITED SCHEDULING ORDER re: Appellant Brief due on 04/30/2010. Joint Appendix due on 04/30/2010. Appellee Brief due on 06/01/2010. Appellant reply brief due on 06/15/2010. Case heard no earlier than the week of 07/05/2010, FILED. [10-992]

04/09/2010 49 NEW CASE MANAGER, Tynetta Wilder, ASSIGNED.[22320] [10-992]
1 pg, 29.05 KB

04/09/2010 52 REPLY TO OPPOSITION [ 30 ], on behalf of Appellant Shaun Donovan,

11 pg, 72.68

Timothy Geithner, Peter Orszag and United States of America, FILED.

KB Service date 04/09/2010 by CM/ECF.[22422][52] [10-992]

04/13/2010 57 NOTICE OF APPEARANCE AS ADDITIONAL COUNSEL, on behalf of Appellant Shaun Donovan, Timothy Geithner, Peter Orszag and United States of America, FILED. Service date 04/13/2010 by CM/ECF. [23626] [10-992]

04/14/2010 59 NOTICE OF APPEARANCE AS ADDITIONAL COUNSEL, on behalf of Attorney Jules Lobel for Appellee Acorn, FILED. Service date 04/14/2010 by CM/ECF. [24543] [10-992]--[Edited 04/15/2010 by TW]

04/15/2010 60 DEFECTIVE DOCUMENT [57], on behalf of Appellant Shaun Donovan,

2 pg, 43.59

Timothy Geithner, Peter Orszag and United States of America,

KB FILED.[24856] [10-992]

04/15/2010 61 DEFECTIVE DOCUMENT [59], on behalf of Appellee Acorn,

2 pg, 43.28

FILED.[24863] [10-992]

KB

04/16/2010 62 NOTICE OF APPEARANCE AS ADDITIONAL COUNSEL, on behalf of

2 pg, 78.39

Appellant Shaun Donovan, Timothy Geithner, Peter Orszag and United States

KB of America, FILED. Service date 04/16/2010 by CM/ECF. [25671] [10-992]

04/16/2010 63
3 pg, 50.77 KB

SUPPLEMENTARY PAPERS TO MOTION [ 15 ], [ 30 ], [ 52 ], on behalf of Appellant Shaun Donovan, Timothy Geithner, Peter Orszag and United States of America, FILED. Service date 04/16/2010 by CM/ECF.[25965][63] [10-992]

04/16/2010 64 NOTICE OF APPEARANCE AS ADDITIONAL COUNSEL, on behalf of

1 pg, 41.19

Appellee Acorn, FILED. Service date 04/16/2010 by CM/ECF. [25968]

KB [10-992]

04/16/2010 76 DEFECTIVE DOCUMENT [ 60 ], on behalf of Appellant Shaun Donovan, Timothy Geithner, Peter Orszag and United States of America, CURED.[26622] [10-992]

04/16/2010 81 DEFECTIVE DOCUMENT [ 61 ], [ 60 ], on behalf of Appellant Shaun Donovan, Timothy Geithner, Peter Orszag, United States of America and Appellee Acorn, CURED.[31935] [10-992]

04/19/2010 65 SUPPLEMENTARY PAPERS TO MOTION [ 63 ], on behalf of Appellee

1 pg, 88.41

Acorn, Acorn Institute, Inc. and New York Acorn Housing Company, Inc.,

KB FILED. Service date 04/19/2010 by CM/ECF.[26086][65] [10-992]

04/19/2010 74 SUPPLEMENTARY PAPERS TO MOTION [ 15 ], on behalf of Appellee

1 pg, 39.13

Acorn, Acorn Institute, Inc. and New York Acorn Housing Company, Inc.,

KB FILED. Service date 04/19/2010 by CM/ECF.[26386][74] [10-992]

04/21/2010 78 MOTION ORDER, granting motion to stay filed by Appellant United States

1 pg, 133.52

of America, Shaun Donovan, Peter Orszag and Timothy Geithner, (RJM, JAC

KB and RCW), FILED. [27127][78] [10-992]

04/26/2010 79 MOTION, to expedite appeal, on behalf of Appellee Acorn, Acorn Institute,

5 pg, 176.34

Inc. and New York Acorn Housing Company, Inc., FILED. Service date

KB 04/26/2010 by CM/ECF. [28978] [10-992]

04/26/2010 80 MOTION, to expedite appeal, on behalf of Appellee Acorn, Acorn Institute,

6 pg, 356.83

Inc. and New York Acorn Housing Company, Inc., FILED. Service date

KB 04/26/2010 by CM/ECF. [29257] [10-992]

05/04/2010 82 MOTION, to reconsider, on behalf of Appellee Acorn, Acorn Institute, Inc.

2 pg, 66.96

and New York Acorn Housing Company, Inc., FILED. Service date

KB 05/04/2010 by CM/ECF. [33121] [10-992]

05/05/2010 83 CASE CALENDARING, 06/24/2010, SET.[33302] [10-992]

 
 United States Court of Appeals, Second Circuit.
ACORN v. UNITED STATES
ACORN, Acorn Institute, Inc., and Mhany Management, Inc., f/k/a/ New York Acorn Housing Company, Inc., Plaintiffs-Appellees, v. UNITED STATES of America, Shaun Donovan, Secretary of the Department of Housing and Urban Development, Peter Orszag Director Office of Management and Budget, Timothy R. Geithner Jr., Secretary of the
Department of Treasury of the United States, Lisa P. Jackson, Administrator of the Environmental Protection Agency, Gary Locke, Secretary of Commerce, and Robert
Gates, Secretary of Defense, Defendants-Appellants.
Docket Nos. 09-5172-cv (L), 10-0992-cv (CON).
Argued: June 24, 2010. -- August 13, 2010
Before MINER, CABRANES, and WESLEY, Circuit Judges.
Jules Lobel, Darius Charney, and William Quigley, Center for Constitutional Rights, Pittsburgh, PA and New York, NY; William Goodman and Julie Hurwitz, Goodman & Hurwitz, P.C., Detroit, MI; Arthur Schwartz, New York, NY, for plaintiffs-appellees.Mark B. Stern, Michael S. Raab, Benjamin S. Kingsley, and Helen L. Gilbert, Appellate Staff, Civil Division, U.S. Department of Justice (Tony West, Assistant Attorney General, Civil Division, U.S. Department of Justice; Benton J. Campbell, U.S. Attorney, Eastern District of New York), Washington, D.C. and Brooklyn, NY, for defendants-appellants.Daniel R. Murdock, Patton Boggs LLP, New York, NY; Haaris Ahmad, Assistant Corporation Counsel, Wayne County, Michigan, Detroit, MI, for amicus curiae Wayne County, Michigan.David B. Rankin and Mark Taylor, Rankin & Taylor, New York, NY, for amici curiae Alliance for Justice; Citizen Action of New York; Hakeem Jeffries; Labor Education & Research Project; Legal Aid Society of New York City; Marty Markowitz; Kevin Powell; Western States Center; and Jumaane D. Williams.Mark D. Stern, Somerville, MA; John C. Philo, Maurice & Jane Sugar Law Center for Economic & Social Justice, Detroit, MI, for amici curiae United Electrical, Radio & Machine Workers of America; Communications Workers of America; Communications Workers of America Local 1180; Transport Workers Union of America; Transport Workers Union of America of Greater New York; Jobs with Justice; Interfaith Worker Justice; and Maurice & Jane Sugar Law Center for Economic & Social Justice.Charles S. Sims and Anna G. Kaminska, Proskauer Rose LLP, New York, NY; Stephen I. Vladeck, Washington, D.C. for amici curiae Constitutional Law Professors Bruce Ackerman, Erwin Chemerinsky, David D. Cole, Michael C. Dorf, Mark Graber, Seth F. Kreimer, Sanford V. Levinson, Burt Neuborne, and Stephen I. Vladeck.
Defendants-appellants, Shaun Donovan, Secretary of Housing and Urban Development (“HUD”); Peter Orszag, Director of the Office of Management and Budget (“OMB”); Timothy Geithner, Secretary of the Treasury; Lisa Jackson, Administrator of the Environmental

Protection Agency (“EPA”); Gary Locke, Secretary of Commerce; Robert Gates, Secretary of Defense; and the United States (collectively, the “government” or “defendants”), appeal from a preliminary injunction entered on December 11, 2009, and a permanent injunction and declaratory judgment entered on March 10, 2010, in the United States District Court for the Eastern District of New York (Gershon, J.).
Plaintiffs-appellees, Association of Community Organizations for Reform Now (“ACORN”), Acorn Institute, and New York Acorn Housing Company1 (“New York Acorn” or, collectively with ACORN and Acorn Institute, the “plaintiffs”) brought this action challenging provisions in several federal appropriations laws barring the distribution of federal funds to ACORN and its affiliates, subsidiaries, and allied organizations. The District Court struck down the challenged provisions, holding that (1) the plaintiffs have Article III standing to challenge the appropriations laws against all of the defendants, including the Secretary of Defense and the Director of OMB; and (2) the appropriations laws singling out ACORN and its affiliates from obtaining federal funds (a) fell within the historical meaning of legislative punishment, (b) did not further a nonpunitive legislative purpose, and (c) were supported by a legislative record that evinced an intent to punish. Accordingly, the court enjoined the defendants from enforcing the challenged provisions of the appropriations laws.
I. BACKGROUND
A. The Plaintiffs
ACORN is a non-profit Arkansas corporation that organizes low- and moderate-income persons “to achieve social and economic justice .” Specifically, ACORN has helped over two million people register to vote, advocated for increasing the minimum wage, worked against predatory lending, prevented foreclosures, assisted over 150,000 people file their tax returns, and “worked on thousands of issues that arise from the predicaments and problems of the poor, the homeless, the underpaid, the hungry and the sick.” ACORN has 500,000 members located in 75 cities across the United States, with its national offices located in Brooklyn, New York, Washington, D.C., and New Orleans, Louisiana. ACORN has received 10% of its funding from the federal government and otherwise has received funding from various national and local sources.
Acorn Institute is a non-profit New Orleans corporation that has a “separate corporate existence from ACORN, with a separate board of directors and separate management.” Acorn Institute, however, collaborates closely and contracts with ACORN to carry out many of the grants which Acorn Institute receives from, inter alios, the federal government. Similar to ACORN, Acorn Institute is involved with civil rights, employment, housing, and social-service issues of lowincome communities. As of September 2009, Acorn Institute employed twenty employees, with its office located in New Orleans, Louisiana.
New York Acorn is a non-profit New York corporation that “owns, develops and manages housing affordable to low income families.” New York Acorn controls over 140 buildings and 1,200 apartments located throughout the boroughs of New York City. New York Acorn is a separate entity from ACORN but is considered an ally or affiliate of ACORN.2 New York Acorn receives part of its funds by way of subcontracting-grants from the New York State Housing

Finance Agency, which, in turn, receives federal funds from HUD for such subcontracting purposes. New York Acorn employs an office staff of thirteen persons and a maintenance staff of twenty-four persons.
The legal and governance structure of ACORN and its “separate but interrelated components,” such as Acorn Institute and New York Acorn, is “incredibly complex,” and at one point the ACORN “[f]amily” was estimated at approximately 200 entities. As found in an internal report issued by ACORN in 2008, however, the ACORN family-which still included Acorn Institute and New York Acorn-had diminished to 29 entities by that time.
B. Mismanagement, Fraud, and Congressional Response
In 1999 and 2000, Dale Rathke, the brother of ACORN's founder Wade Rathke, embezzled nearly $1 million from the organization. Upon discovery of the embezzlement, “a small group of executives decided to keep the information from almost all of the group's board members and not to alert law enforcement.” A restitution agreement was signed in which the Rathke family “agreed to repay [, beginning in 2001], the amount embezzled in exchange for confidentiality.” In June 2008, however, a whistleblower forced ACORN to disclose the embezzlement, and at that time ACORN's mismanagement came under serious public scrutiny. ACORN immediately prepared an internal report noting, among other issues, “potentially improper use of charitable dollars for political purposes” as well as possible violations of federal law by ACORN and its “web” of nearly 200 affiliated organizations.
ACORN's reputation suffered further upon accusations of voter registration fraud, for which ACORN's workers had been convicted in prior years. Between October 2008 and May 2009, two more ACORN workers were charged with, and convicted of, voter registration fraud. While ACORN adopted “several good-governance policies” to address the problems identified in the internal report, a new scandal arose in the summer of 2009 when “hidden camera” videos revealed ACORN employees and volunteers providing advice and counseling in support of a proposed prostitution business.
In response to these events, ACORN commissioned an independent report to analyze “the videos that caused this summer's uproar” and “the entire organization, its core weaknesses and inherent strengths.” The report, referred to as the “Harshbarger Report” because it was prepared by Scott Harshbarger, cited many of the problems of management previously noted in the internal report issued in 2008. Although the Harshbarger Report revealed that the hidden-camera videos were heavily edited, “manipulated,” and “distorted,” the report nonetheless criticized ACORN's “organizational and supervisory weakness” and overall failure to provide adequate organizational infrastructure necessary to manage and oversee its operations.
In September 2009, the U.S. Census Bureau and the Internal Revenue Service, both of which collaborated with ACORN on certain programs, ended their relationship with ACORN due to its negative publicity. That same month, members of Congress asked the Government Accountability Office (“GAO”) to initiate an investigation into ACORN's activities because “there remain[ed] significant concern that millions of taxpayer dollars were used improperly, and possibly criminally, by the organization.” Several states suspended their funding of ACORN and

its affiliates. In the State of Nevada, ACORN and two of its employees were charged with participating in an illegal voter registration scheme.
On October 1, 2009, Congress passed a “stop-gap” appropriations law to fund federal agencies prior to the enactment of the 2010 Fiscal Year appropriations. See Continuing Appropriations Resolution (“Continuing Resolution”), 2010, Pub.L. No. 111-68, Div. B, § 163, 123 Stat.2023, 2053 (2009). Section 163 of the Continuing Resolution singled out ACORN as follows:
None of the funds made available by this joint resolution or any prior Act may be provided to the Association of Community Organizations for Reform Now ACORN, or any of its affiliates, subsidiaries, or allied organizations.
Id. The provisions of the Continuing Resolution-including Section 163-were set to expire on December 18, 2009. See Department of the Interior, Environment, and Related Agencies Appropriations Act, 2010, Division B-Further Continuing Appropriations, 2010, § 101, Pub.L. No. 111-88, 123 Stat. 2904, 2972 (2009).
In a memorandum dated October 7, 2009, the Director of OMB advised the heads of all executive agencies, inter alia, (1) that Section 163 prohibited them from providing any federal funds to ACORN and its affiliates, subsidiaries, and allied organizations during the period of the Continuing Resolution; (2) to suspend any existing contracts with ACORN and its affiliates “where permissible”; and (3) to take steps “so that no Federal funds are awarded or obligated by your grantees or contractors to ACORN or its affiliates as subcontractors, or other subrecipients.” In a subsequent memorandum, the Office of Legal Counsel clarified that Section 163 would not prohibit funds to be paid pursuant to binding contractual obligations that predated the exclusion.
C. Entry of Preliminary Injunction and Subsequent Developments
On November 12, 2009, the plaintiffs commenced an action in the District Court to enjoin the United States, the Secretary of the Treasury, the Secretary of HUD, and the Director of OMB from enforcing Section 163. In its complaint, the plaintiffs argued that the appropriations laws violated the First Amendment, the Due Process Clause, and the Bill of Attainder Clause. The plaintiffs then moved for a preliminary injunction, which the court granted in an opinion and order filed on December 11, 2009, after concluding that the plaintiffs showed a likelihood of success on its bill-of-attainder claim. The District Court did not address the plaintiffs' remaining First Amendment and due process claims. In response to the District Court's ruling, the OMB rescinded its memorandum addressing the heads of all executive agencies on Section 163. See Office of Mgmt. & Budget, Exec. Office of the President, M-10-02, Guidance on section 163 of the Continuing Resolution regarding the Association of Community Organizations for Reform Now (ACORN) (Oct. 7, 2009), available at http:// www.whitehouse.gov/omb/assets/memoranda_2010/m10-02.pdf (last visited Aug. 10, 2010).
Meanwhile, Congress passed appropriations laws for fiscal year 2010, which President Obama signed into law. See Consolidated Appropriations Act, 2010, Pub.L. No. 111-117, 123 Stat. 3034 (2009); Department of Defense Appropriations Act, 2010, Pub.L. No. 111-118, 123 Stat. 3409

(2009). One section of the appropriations laws used identical language to that of Section 163 and specifically excluded ACORN and its “affiliates, subsidiaries, and allie[s]” from federal funding. Four sections of the appropriations laws similarly excluded ACORN and its “subsidiaries” from federal funding.3 In addition to the specific exclusion of ACORN from federal funding, the appropriations laws included Section 535, which directed the GAO to “conduct a review and audit of the Federal funds received by ACORN or any subsidiary or affiliate of ACORN” to determine
(1) whether any Federal funds were misused and, if so, the total amount of Federal funds involved and how such funds were misused;
(2) what steps, if any, have been taken to recover any Federal funds that were misused;
(3) what steps should be taken to prevent the misuse of any Federal funds; and
(4) whether all necessary steps have been taken to prevent the misuse of any Federal funds[.]
Commerce, Justice, Science, and Related Agencies Appropriations Act, 2010, Pub.L. No. 111117, Div. B, § 535, 123 Stat. 3034, 3157-58 (2009). Section 535 required the GAO to submit its report “[n]ot later than 180 days after the enactment of this Act.” Id. at 3158.
D. Declaratory Relief and Permanent Injunction
On consent of the government, the plaintiffs filed an amended complaint challenging the five sections of the latest appropriations laws, in addition to the by-then-expired Section 163. The amended complaint included the three remaining defendants in this appeal: the Administrator of the EPA; the Secretary of Commerce; and the Secretary of Defense.
In a judgment filed on March 10, 2010, the District Court granted the plaintiffs' request for declaratory relief and a permanent injunction. Specifically, the District Court held that the appropriations laws constituted unconstitutional bills of attainder; that the plaintiffs possessed standing to bring these claims against the named defendants; and that a permanent injunction was warranted in light of the unconstitutionality of the appropriations laws and the irreparable injuries suffered by the plaintiffs. As with its granting of the plaintiffs' motion for a preliminary injunction, the District Court again declined to reach the plaintiffs' First Amendment and due process claims in light of its determination that the challenged laws were bills of attainder.
The government timely appealed the District Court's judgment, and we subsequently granted the government's motion to stay the injunction pending the appeal. On appeal, the government argues (1) that the plaintiffs lack standing against two of the defendants, namely, the Secretary of Defense and the Director of OMB, because the plaintiffs cannot show an actual injury that is fairly traceable to any current or anticipated actions by these two defendants; and (2) that the District Court erroneously determined the appropriations laws to be bills of attainder, because (a) the challenged laws are not congruent with any historical understanding of punishment; (b) the challenged laws do not constitute punishment as a functional matter; and (c) the legislative record does not evince an unmistakably punitive purpose.

II. DISCUSSION
A. Standard of Review
We review a district court's grant of a permanent injunction for abuse of discretion. Reynolds v. Giuliani, 506 F.3d 183, 189 (2d Cir.2007). A district court abuses its discretion “when (1) its decision rests on an error of law (such as application of the wrong legal principle) or a clearly erroneous factual finding, or (2) its decision-though not necessarily the product of a legal error or a clearly erroneous factual finding-cannot be located within the range of permissible decisions.” Kickham Hanley P.C. v. Kodak Ret. Income Plan, 558 F.3d 204, 209 (2d Cir.2009) (internal quotation marks omitted). Our review of questions of law is de novo. See, e.g., Spiegel v. Schulmann, 604 F.3d 72, 76 (2d Cir.2010); Ascencio-Rodriguez v. Holder, 595 F.3d 105, 110 (2d Cir.2010); Donk v. Miller, 365 F.3d 159, 164 (2d Cir.2004).
B. Standing to Sue the Secretary of Defense and the Director of OMB
The jurisdiction of the federal courts is limited to the resolution of “cases” and “controversies.” U.S. Const. art. III, § 2. The corollary of this restriction is that the challenging party must have “standing” to pursue its case in federal court. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992). Standing is established where (1) the challenging party has “suffered an ‘injury in fact’-an invasion of a legally protected interest that is (a) concrete and particularized and (b) actual or imminent, rather than conjectural or hypothetical”; (2) there is “a causal connection between the injury and the challenged conduct”; and (3) it is “likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.” Gully v. Nat'l Credit Union Admin. Bd., 341 F.3d 155, 160-61 (2d Cir.2003) (internal quotation marks omitted). “The party invoking federal jurisdiction bears the burden of establishing these elements.” Id. at 161.
The government challenges the plaintiffs' standing to sue the Secretary of Defense and the Director of OMB. The government argues that, unlike the other defendants in this appeal, the plaintiffs have never received-and do not intend to apply for-grants or contracts from the Department of Defense. The government also argues that the plaintiffs have not suffered any injury caused by OMB because Section 163 is no longer effective; OMB rescinded its memorandum advising the heads of all the executive agencies; and, in any event, OMB has no authority to enforce federal statutes.
The plaintiffs cannot be said to lack standing to sue a government agency constrained to enforce a law that specifically names ACORN and prevents the plaintiffs from receiving federal funds. Cf. Foretich v. United States, 351 F.3d 1198, 1213 (D.C.Cir.2003) (holding that plaintiff had standing to challenge as a bill of attainder a statute that deprived him of his child visitation rights-even though his child was eighteen and the statute no longer had any effect on his right to see her-because “Congress's act of judging [Foretich] and legislating against him on the basis of that judgment ․ directly give[s] rise to a cognizable injury to his reputation”); see also 5 U.S.C. § 702 (when enjoining the United States for agency actions, the court is required to name all officials who are responsible for compliance with the injunction). Even if the plaintiffs are not and never will be interested in applying for grants or funding from the Department of Defense, the fact that the defense department's appropriations law specifically prohibits ACORN and its

affiliates from being eligible for federal funds affects the plaintiffs' reputation with other agencies, states, and private donors. See Gully, 341 F.3d at 162 (“The Supreme Court has long recognized that an injury to reputation will satisfy the injury element of standing.”).
The government's argument that the plaintiffs lack standing to sue the Director of OMB is similarly misplaced. Although the government asserts that OMB has no authority to enforce federal statutes, OMB “oversee[s] the execution” of the federal budget and has a continuing responsibility to explain appropriations provisions to agencies. See U.S.C.A. Reorg. Plan 2 1970, 84 Stat.2085, as amended by Pub.L. No. 97-258, § 5(b), 96 Stat. 1068, 1085 (1982) (stating that the OMB performs the “key function of assisting the President in the preparation of the annual Federal budget and overseeing its execution”). See generally id. (“While the budget function remains a vital tool of management, ․ [t]he new Office of Management and Budget will place much greater emphasis on the evaluation of program performance ․ [and] expand efforts to improve interagency cooperation.”). To that end, OMB's now-rescinded memorandum-which is the basis for the plaintiffs' claim of reputational injury with respect to Section 163-was issued. As explained by the District Court, notwithstanding the rescission of the OMB memorandum and expiration of Section 163, the OMB memorandum continues to exert influence over the plaintiffs' reputation:
Following [the District Court's entry of a preliminary injunction], OMB did send an email to all federal agencies' general counsels informing them of the injunction entered ․ and that the government was considering appeal, but OMB did not direct them to inform their agencies, grantees, and grantees' subcontractors of this court's ruling. The reputational harm, therefore, continues, as the original advice from OMB to the hundreds, if not thousands, of recipients of that advice has never been rescinded.
Indeed, the OMB memorandum providing guidance for application of Section 163 is still available on OMB's website. See Office of Mgmt. & Budget, Exec. Office of the President, M10-02, Guidance on Section 163 of the Continuing Resolution regarding the Association of Community Organizations for Reform Now (ACORN) (Oct. 7, 2009), available at http:// www.whitehouse.gov/omb/assets/memoranda_2010/m10-02.pdf (last visited Aug. 10, 2010). Although the website states that the memorandum has been rescinded, there is also a notation that “the enacted restrictions on funding ACORN and affiliates ․ remain in force” in light of this Court's granting the government's motion for a stay pending appeal. Office of Mgmt. & Budget, Exec. Office of the President, Memoranda 2010, http:// www.whitehouse.gov/omb/memoranda_default/ (last visited Aug. 10, 2010). Thus, what is called a rescission in fact functioned in no such way. In light of OMB's actual and continuing responsibility to oversee the management of the budgets of Executive Branch agencies, and its consequent impact on the plaintiffs' reputation, the plaintiffs have shown sufficient injury to bring suit against the Director of the OMB.
We therefore affirm the judgment of the District Court with regard to the issue of standing.
C. Bill of Attainder

The Constitution prohibits the enactments of “bills of attainder .” See U.S. Const. art. I, § 9 (prohibiting Congress); id. § 10 (prohibiting states). Historically, a bill of attainder
was a device often resorted to in sixteenth, seventeenth and eighteenth century England for dealing with persons who had attempted, or threatened to attempt, to overthrow the government. In addition to the death sentence, attainder generally carried with it a “corruption of blood,” which meant that the attainted party's heirs could not inherit his property. The “bill of pains and penalties” was identical to the bill of attainder, except that it prescribed a penalty short of death, e.g., banishment, deprivation of the right to vote, or exclusion of the designated party's sons from Parliament. Most bills of attainder and bills of pains and penalties named the parties to whom they were to apply; a few, however, simply described them. While some left the designated parties a way of escaping the penalty, others did not.
United States v. Brown, 381 U.S. 437, 441-42 (1965) (footnotes omitted).
The scope of the Bill of Attainder Clause, however, has been interpreted as wider than the historical definition of a “bill of attainder.” See Matter of Extradition of McMullen, 989 F.2d 603, 606-07 (2d Cir.1993) (en banc) (“[T]he Bill of Attainder Clause broadly ․ prohibit[s] bills of pains and penalties as well as bills of attainder.”); South Carolina v. Katzenbach, 383 U.S. 301, 324 (1966) (stating that the Bill of Attainder Clause provides “protections for individual persons and private groups”); Brown, 381 U.S. at 442 (stating that the Constitution's prohibition against bills of attainder “was intended not as a narrow, technical (and therefore soon to be outmoded) prohibition, but rather as an implementation of the separation of powers, a general safeguard against legislative exercise of the judicial function, or more simply-trial by legislature”). Indeed, it can be said that the broadness of the American prohibition of bills of attainder under Article I, section 9 is more a reflection of the Constitution's concern with fragmenting the government power than merely preventing the recurrence of unsavory British practices of the time. See generally Roger J. Miner, Identifying, Protecting and Preserving Individual Rights: Traditional Federal Court Functions, 23 Seton Hall L.Rev. 821, 826-30 (19921993) (discussing bills of attainder).
In its contemporary usage, the Bill of Attainder Clause prohibits any “law that legislatively determines guilt and inflicts punishment upon an identifiable individual without provision of the protections of a judicial trial.” Selective Serv. Sys. v. Minn. Pub. Interest Research Grp., 468 U.S. 841, 846-47 (1984). That is, the Supreme Court has identified three elements of an unconstitutional bill of attainder: (1) “specification of the affected persons,” (2) “punishment,” and (3) “lack of a judicial trial.” Id. at 847. Although the Supreme Court has never had occasion to rule on the issue, we have held that the scope of the “specification of the affected persons” element includes corporate entities. See Con. Edison Co. of N.Y., Inc. v. Pataki, 292 F.3d 338, 349 (2d Cir.2002) (“We therefore hold that corporations must be considered individuals that may not be singled out for punishment under the Bill of Attainder Clause.” (internal quotation marks, alteration, and citation omitted)).
With respect to the existence vel non of punishment, three factors guide our consideration: (1) whether the challenged statute falls within the historical meaning of legislative punishment (historical test of punishment); (2) whether the statute, “viewed in terms of the type and severity

of burdens imposed, reasonably can be said to further nonpunitive legislative purposes” (functional test of punishment); and (3) whether the legislative record “evinces a [legislative] intent to punish” (motivational test of punishment). Selective Serv. Sys., 468 U.S. at 852. All three factors need not be satisfied to prove that a law constitutes “punishment”; rather, “th[e] factors are the evidence that is weighed together in resolving a bill of attainder claim.” Con. Edison, 292 F.3d at 350.
Because the government does not challenge the District Court's determination that the specificity and lack-of-judicial-trial elements are satisfied in this case, we focus on whether the laws constitute the type of “punishment” that runs afoul of the Bill of Attainder Clause.
1. Historical Test of “Punishment”
The Supreme Court has recognized that certain types of punishment are “so disproportionately severe and so inappropriate to nonpunitive ends that they unquestionably have been held to fall within the proscription of the [Bill of Attainder Clause].” Nixon v. Adm'r of Gen. Servs., 433 U.S. 425, 473 (1977). “The classic example is death, but others include imprisonment, banishment, the punitive confiscation of property, and prohibition of designated individuals or groups from participation in specified employments or vocations.” Con. Edison, 292 F.3d at 351 (internal quotation marks, alteration, and ellipsis omitted). A familiar theme in these classic examples of punishment is the initial determination by the legislature of “guilt.” See De Veau v. Braisted, 363 U.S. 144, 160 (1960) (“The distinguishing feature of a bill of attainder is the substitution of a legislative for a judicial determination of guilt.”).
Here, the plaintiffs analogize the appropriations laws to the “cutoff of pay to specified government employees held to constitute punishment for purposes of the Bill of Attainder Clause [in United States v. Lovett, 328 U.S. 303, 317-18 (1946) ].” In the plaintiffs' view, that the appropriations laws do not constitute a permanent ban or disqualification of ACORN from federal funds is immaterial because “the consequences of even a temporary ban on government funding for government contractors can be potentially harsh.” Moreover, the plaintiffs argue that the appropriations laws precluding ACORN from receiving federal funds, despite having an expiration date, could be renewed every year and therefore constitute a de facto permanent ban.
The withholding of appropriations, however, does not constitute a traditional form of punishment that is “considered to be punitive per se.” See Con. Edison, 292 F.3d at 351. Congress's decision to withhold funds from ACORN and its affiliates constitutes neither imprisonment, banishment, nor death. The withholding of funds may arguably constitute a punitive confiscation of property at some point, but the plaintiffs do not assert that they have property rights to federal funds that have yet to be disbursed at the agency's discretion. We note, further, that “[t]here may well be actions that would be considered punitive if taken against an individual, but not if taken against a corporation.” Id. at 354. In comparison to penalties levied against individuals, a temporary disqualification from funds or deprivation of property aimed at a corporation may be more an inconvenience than punishment. While ACORN claims that it will be “drive[n] close to bankruptcy” and may suffer a “corporate death sentence” without federal funds, the Harshbarger Report reveals that ACORN only derives 10% of its funding from federal grants. Thus, we doubt that the direct consequences of the appropriations laws temporarily precluding ACORN from

federal funds are “so disproportionately severe” or “so inappropriate” as to constitute punishment per se. See Nixon, 433 U.S. at 472 (“Forbidden legislative punishment is not involved merely because the Act imposes burdensome consequences.”).
As asserted by the plaintiffs, the appropriations laws “attaint ACORN with a note of infamy ․ [and] encourage others to shun ACORN.” But the plaintiffs are not prohibited from any activities; they are only prohibited from receiving federal funds to continue their activities. Although the appropriations laws may have the effect of alienating ACORN and its affiliates from their supporters, Congress must have the authority to suspend federal funds to an organization that has admitted to significant mismanagement. The exercise of Congress's spending powers in this way is not “so disproportionately severe and so inappropriate to nonpunitive ends” as to invalidate the resulting legislation as a bill of attainder. See Nixon, 433 U.S. at 473; cf. Sabri v. United States, 541 U.S. 600, 605 (2004) (“Congress has authority under the Spending Clause to appropriate federal moneys to promote the general welfare, and it has corresponding authority under the Necessary and Proper Clause to see to it that taxpayer dollars appropriated under that power are ․ not frittered away in graft or on projects undermined when funds are siphoned off or corrupt public officers are derelict about demanding value for dollars.” (internal citations omitted)). And, in any event, according to the plaintiffs, at least one state that had previously suspended funding to the plaintiffs has restored funding to New York Acorn. See 28(j) Letter on Behalf of ACORN (dated June 22, 2010). Thus, the plaintiffs' claim of alienationthat is, their claim that they have been tainted with “a note of infamy”-is not as severe as the plaintiffs assert.
Of course, as discussed in more detail infra Analysis II(B)(3) (Motivational Test of Punishment), there is some evidence in the record indicating that ACORN was precluded from receiving federal funds upon the legislature's determination that ACORN was guilty of abusive and fraudulent practices. This evidence points in the direction of a traditional form of punishment. See De Veau, 363 U.S. at 160. “The fact that the punishment is inflicted through the instrumentality of an Act specifically cutting off the pay of certain named individuals found guilty of disloyalty, makes it no less galling or effective than if it had been done by an Act which designated the conduct as criminal.” Lovett, 328 U.S. at 316. Nonetheless, despite statements about ACORN's guilt on the legislative floor, the appropriations laws themselves do not mention ACORN's guilt in any way. Cf. Con. Edison, 292 F.3d at 344 (the challenged law expressly found that Consolidated Edison had failed “to exercise reasonable care”). Moreover, unlike Lovett, here, there was no congressional “trial” to determine ACORN's guilt. Cf. Lovett, 328 U.S. at 310-12 (involving a secret congressional trial for engaging in subversive Communist activities, with the suspected Communists allowed to testify in their defense). As the Supreme Court noted in Flemming v. Nestor, 363 U.S. 603, 617-19 (1960), where a court is left only with the legislative history of a law that is impugned as a bill of attainder, there must be “unmistakable evidence of punitive intent [in the legislative history] ․ before a Congressional enactment of this kind may be struck down.” Although there is some evidence of a determination of guilt in the legislative history of the appropriations laws, for the reasons stated infra Analysis II(B)(3) (Motivational Test of Punishment), there is not “unmistakable evidence” of congressional intent to punish within the contemplation of the Bill of Attainder Clause. We therefore find no basis for drawing the conclusion that the challenged appropriations laws constitute “punishment” as it was historically understood.

2. Functional Test of Punishment
The functional test of punishment looks to whether the challenged law, “viewed in terms of the type and severity of burdens imposed, reasonably can be said to further nonpunitive legislative purposes.” Nixon, 433 U.S. at 475. “It is not the severity of a statutory burden in absolute terms that demonstrates punitiveness so much as the magnitude of the burden relative to the purported nonpunitive purposes of the statute.” Foretich, 351 F .3d at 1222. Thus, “[a] grave imbalance or disproportion between the burden and the purported nonpunitive purpose suggests punitiveness, even where the statute bears some minimal relation to nonpunitive ends.” Id.; accord Con. Edison, 292 F.3d at 350 (“Where a statute establishing a punishment declares and imposes that punishment on an identifiable party ․ we look beyond simply a rational relationship of the statute to a legitimate public purpose for less burdensome alternatives by which the legislature could have achieved its legitimate nonpunitive objectives.” (internal quotation marks, ellipsis, and alterations omitted)).
Initially, the plaintiffs appear to suggest that the appropriations laws are presumptively unconstitutional bills of attainder because they specifically named ACORN for exclusion from federal funds. But Congress may single out an entity or person in its legislation. See Nixon, 433 U.S. at 469-72 (rejecting the argument that “the Constitution is offended whenever a law imposes undesired consequences on an individual or on a class that is not defined at a proper level of generality”); Con. Edison, 292 F.3d at 350 (“A legislature may legitimately create a ‘class of one’ for many purposes.”). Although the specific naming of ACORN in the appropriations laws satisfies one classic mark of a bill of attainder-and is certainly relevant in assessing the plausibility of the alleged punitive purposes of the challenged law, see Foretich, 351 F.3d at 1224-such specificity does not create a presumption of unconstitutionality. Because the party challenging a congressional law as an unconstitutional bill of attainder bears the burden of proof, see Con. Edison, 292 F.3d at 350 (“The party challenging the statute has the burden of establishing that the legislature's action constituted punishment and not merely the legitimate regulation of conduct.” (internal quotation marks and alteration omitted) (emphasis added)), we accord no presumption that the appropriations laws specifying ACORN for exclusion constitute bills of attainder.
With respect to the non-punitive purpose for the appropriations laws, the government argues that Congress was motivated by its desire to “ensur[e] the effective expenditure of taxpayer dollars.” According to the government, the appropriations laws at issue here “provide a temporary response to incontrovertible evidence of mismanagement by organizations that are part of a complex, poorly-managed family of organizations, pending the findings of ongoing investigations.” While acknowledging that Congress has a legitimate interest in ensuring the proper use of taxpayer money, the plaintiffs argue that the specificity of the affected parties, the uniqueness of the congressional action, and the breadth of restrictive action in this case render the appropriations laws disproportionately severe and thus “punitive” under the functional test of punishment. Specifically, the plaintiffs argue: (1) Congress singled out ACORN for exclusion despite other contractors having similar problems with mismanagement; (2) the appropriations laws, which affect ACORN and its affiliates, subsidiaries, and even allied organizations, is “clearly overbroad” in relation to the laws' purported legitimate purposes; (3) the appropriations laws bypass existing regulations that address concerns about funding mismanaged organizations,

such as ACORN; and (4) the appropriations laws unnecessarily preclude ACORN's obtaining federal funds for one year, regardless of the results of the GAO's investigation of ACORN's operations, i.e., even if the GAO concluded that ACORN was no longer plagued with mismanagement, the exclusion from federal funds would continue for the fiscal year.
We note that the plaintiffs' claim that the appropriations laws are punitive because they single out ACORN is undermined by the plaintiffs' claim that the appropriations laws are also punitive because they affect hundreds of unnamed “allied” and “affiliated” organizations. If the appropriations laws affect such broad groups of organizations, then they are similar to a rule of general applicability and are less likely to have a punitive purpose. See, e.g., Flemming, 363 U.S. at 620 (rejecting claim that a law excluding certain deportees, i.e., criminal, subversive, or illegal, from receiving social security benefits was not a bill of attainder because the law affected “the great majority of those deported” and because there was not unmistakable evidence that the law had a punitive purpose); cf. Foretich, 351 F.3d at 1224 (“[N]arrow application of a statute to a specific person or class of persons raises suspicion, because the Bill of Attainder Clause is principally concerned with the singling out of an individual for legislatively prescribed punishment.” (internal quotation marks, alteration, and emphasis omitted)). Indeed, because ACORN and its related entities make up such an amorphous and sprawling family of organizations-at one time consisting of approximately 200 entities governed by a structure that was “incredibly complex”-it was entirely reasonable for Congress to broadly exclude ACORN's affiliates, subsidiaries, and allies from federal funds, and leave it to the agencies to determine which organizations would be excluded to further the congressional purpose of protecting the public fisc from ACORN's admitted failures in management. See, e.g., Post-Argument Letter of the United States (dated July 8, 2010) (responding to the plaintiffs' post-argument submission by attaching an agency letter dated July 8, 2010, stating that HUD “has determined that [New York Acorn] is not an affiliate, subsidiary or allied organization of ACORN”).
The plaintiffs' assertion that the appropriations laws are punitive because they bypass administrative procedures is also unpersuasive. Although a law that bypasses administrative procedures may “reinforce[ ]” the conclusion that the law was intended “to find guilt and order punishment directly,” Con. Edison, 292 F.3d at 349, the same inference is difficult to draw when a congressional appropriations law is at issue. Cf. id. (finding violation of Bill of Attainder Clause where the legislative act, which prohibited Consolidated Edison from recovering costs from its ratepayers, was aimed at the allocation of private funds). While withholding federal funds may constitute punishment in certain circumstances, a temporary ban on federal assistance to the groups at issue here-ACORN (which admitted to mismanagement and embezzlement and suffered numerous convictions of its workers), and Acorn Institute and New York Acorn (which were part of a complex web of interrelated entities with ACORN)-is not comparable to congressional acts of punishment such as permanent disqualification from a certain vocation or criminalizing past conduct. See, e.g., Brown, 381 U.S. at 455; Pierce v. Carskadon, 83 U.S. 234 (1872); Ex Parte Garland, 71 U.S. 333 (1867); Cummings v. Missouri, 71 U.S. 227 (1867); cf. Selective Serv. Sys., 468 U.S. at 853 (upholding law that withheld federal student assistance to men who had not registered for the draft); Flemming, 363 U.S. at 618-21 (upholding law that excluded certain deportees from receiving social security benefits). Compare Am. Commc'ns Ass'n, C .I.O. v. Douds, 339 U.S. 382, 413-15 (1950) (rejecting bill-of-attainder challenge against a law that required union officers to file affidavits-that they were not Communist Party

members and that they did not favor the overthrow of the United States government by force or violence-in order to invoke the assistance and services of the NLRB), with Brown, 381 U.S. at 455 (declaring unconstitutional a law that made it a crime for a member of the Communist Party to serve as a union officer or manager).
Finally, we reject the plaintiffs' argument that the appropriations laws are punitive because they disqualify ACORN from federal funds even if the GAO investigation results in a favorable disposition for ACORN. Although there is no provision in the appropriations laws that ties the GAO investigation with ACORN's status to receive federal funds, Congress could, of course, modify the appropriations law following the GAO's investigation.”4 See BellSouth Corp. v. FCC, 162 F.3d 678, 687 (D.C.Cir.1998) (noting that even if there were alternate ways of fulfilling legitimate government interests, “it [is] up to the legislature to make this decision”). On the facts of this case, Congress's response is not so out of proportion to its purported non-punitive goal of protecting public funds from future fraud and waste so as to render the funding bans punitive in nature.
In sum, the plaintiffs have failed to show that the appropriations laws constitute “punishment” under the functional test.
3. Motivational Test of Punishment
The legislative record by itself is insufficient evidence for classifying a statute as a bill of attainder unless the record reflects overwhelmingly a clear legislative intent to punish. See Flemming, 363 U.S. at 617 (“[O]nly the clearest proof could suffice to establish the unconstitutionality of a statute on [the] ground [of legislative history.]”); see also Lovett, 328 U.S. at 308-12 (recounting extensive evidence of punitive intent in the legislative record). Statements by a smattering of legislators “do not constitute [the required] unmistakable evidence of punitive intent.” Selective Serv. Sys., 468 U.S. at 856 n. 15 (internal quotation marks omitted).
Here, as the plaintiffs argue, the legislative record reveals much concern about protecting the expenditure of taxpayer money against “waste, fraud, and abuse.” 155 Cong. Rec. S9517 (daily ed. Sept. 17, 2009) (Senator Johanns); see also 155 Cong. Rec. S11313 (daily ed. Nov. 10, 2009). Senator Bond described the exclusion as necessary because of ACORN's “endemic and systemwide culture of fraud and abuse” and stated that Congress had “the opportunity to end this relationship now.” 155 Cong. Rec. S9314 (daily ed. Sept. 14, 2009). Congressman Issa published an eighty-eight-page staff report that concluded that ACORN and organizations associated or allied with it constituted “a criminal enterprise” that had “repeatedly and deliberately engaged in systemic fraud” and “committed a conspiracy to defraud the United States by using taxpayer funds for partisan political activities.” This report was read into the Congressional Record when one of the challenged appropriation laws was introduced. See 155 Cong. Rec. S9308, 9309-10, 9317 (daily ed. Sept. 14, 2009) (Senator Johanns) (describing ACORN as “besieged by corruption, by fraud, and by illegal activities,-all committed on the taxpayers' dime”).
According to the plaintiffs, nearly ten members of the House of Representatives assailed ACORN as “this crooked bunch,” “this corrupt and criminal organization,” and being involved

in “child prostitution,” “shaking down lenders,” “corrupting our election process,” “trafficking illegal aliens,” and being in the “criminal hall of fame,” among other epithets and accusations. See 155 Cong. Rec. H9946-10129. There were also, however, representatives who opposed the exclusion of ACORN during these debates. For example, Senator Durbin stated: “[W]e are seeing in Congress an effort to punish ACORN that goes beyond any experience I can recall in the time I have been on Capitol Hill. We have put ourselves-with some of the pending amendments-in the position of prosecutor, judge and jury.” 155 Cong. Rec. S10181, 10211 (daily ed. Oct. 7, 2009). Senator Leahy similarly protested the attack on ACORN: “Everyone-except perhaps many of the casual observers who are the target audience of the orchestrated antiACORN frenzy-knows that the score-at-any-price partisanship is being mixed in an unseemly way with public policy.” 155 Cong. Rec. S9541-42 (daily ed. Sept. 17, 2009).
Despite the evidence of punitive intent on the part of some members of Congress, unlike in Lovett, there is no congressional finding of guilt in this case. In Lovett, a secret trial was held by Congress to determine the guilt or innocence of the accused subversives. Upon a finding of guilt, Congress passed the law denying the accused their salary for federal service. Thus, in Lovett, the congressional record was “unmistakably” clear as to Congress's intent to punish the subject individuals. Here, at most, there is the “smattering” of legislators' opinions regarding ACORN's guilt of fraud. See United States v. O'Brien, 391 U.S. 367, 384 (1968) (“What motivates one legislator to make a speech about a statute is not necessarily what motivates scores of others to enact it.”); cf. Selective Serv. Sys., 468 U.S. at 855-56 (upholding law denying federal financial assistance for higher education to male students who failed to register for the draft; in that case, as here, many legislators commented that the men who failed to register for the draft had committed a “felony, they have violated the law, and they are not entitled to these educational benefits”); BellSouth Corp., 162 F.3d at 690 (sustaining provision that placed special restrictions on Bell operating companies and dismissing a “few scattered remarks referring to ․ abuses allegedly committed by [Bell operating companies] in the past” as not providing the kind of “ ‘smoking gun’ evidence of congressional vindictiveness”).
To be sure, a congressional finding following a legislative trial is not the only way to establish the “unmistakable evidence” of punitive intent in the legislative record; however, here, the statements by a handful of legislators are insufficient to establish-by themselves-the clearest proof of punitive intent necessary for a bill of attainder. Nor is the legislative record sufficient to demonstrate “punishment” cumulatively with the historical and functional tests of punishment analyzed above.
III. CONCLUSION
In accordance with the foregoing, the judgment of the District Court is affirmed in part and vacated in part. We remand for further proceedings as to the plaintiffs' First Amendment and due process claims.
FOOTNOTES
1. New York Acorn has recently changed its name to MHANY Management, Inc.

2. Following oral argument, HUD determined for purposes of its appropriations law that New York Acorn “is not an affiliate, subsidiary or allied organization of ACORN.” Post-Argument Letter of the United States (dated July 8, 2010).
3. The Department of the Interior, Environment, and Related Agencies Appropriations Act of 2010, Pub.L. No. 111-88, Division A, Section 427; Consolidated Appropriations Act of 2010, Pub.L. No. 111-117, Division A, Section 418; Consolidated Appropriations Act of 2010, Pub.L. No. 111-117, Division B, Section 534; Consolidated Appropriations Act of 2010, Pub.L. No. 111-117, Division E, Section 511; and The Department of Defense Appropriations Act of 2010, Pub.L. No. 111-118, Division A, Section 8123.
4. A preliminary report issued by the GAO states that “the information in this report is preliminary and subject to change. We plan to issue a report later this year with our final results related to ACORN and potentially related organizations.” U.S. Gov't Accountability Office, Washington, D.C., Preliminary Observations on Funding, Oversight, and Investigations and Prosecutions of ACORN or Potentially Related Organizations (June 14, 2010), http://www.gao.gov/new.items/d10648r.pdf.