Court Cases We Are Monitoring
Overview
The Council is committed to helping our members stay informed about litigation that may have an impact on the philanthropic sector. This resource is designed to be a guide to cases that could impact the operations of foundations and other grantmaking organizations. This page lists active cases; please see our list of cases that have been decided. For a more comprehensive overview of cases targeting DEI initiatives broadly, we recommend consulting this DEI litigation tracker published by The Meltzer Center for Diversity, Inclusion, and Belonging at New York University School of Law.
This webpage was last updated on October 9, 2026.
Cases
Alaska Policy Forum v. Alaska Public Offices Commission
Supreme Court of the United States
Alaska Policy Forum (APF), a 501(c)(3) public-policy organization, published materials discussing ranked-choice voting before Alaska’s 2020 election. That election ultimately included a ballot initiative proposing a ranked-choice voting law. The Alaska Public Offices Commission determined that AFP’s materials were intended to influence voters to oppose the ballot initiative and therefore triggered the state’s election-related registration, reporting, and donor disclosure requirements.
APF challenged that decision, but the Alaska Supreme Court upheld it in February 2026, finding that APF had implicitly advocated against the ballot initiative without violating the First Amendment.
APF petitioned the U.S. Supreme Court for review That petition asks the Court to consider whether the government’s interest in donor disclosure is sufficient to overcome First Amendment associational interests related to speech on issues relevant to an election but without discussing that election. AFP also asks the Court to weigh the constitutionality of the government’s test for distinguishing between issue speech and express advocacy and whether the government’s donor disclosure requirements advance a compelling or sufficiently important interest.
Current Status: APF’s petition is pending before the U.S. Supreme Court. The amicus brief was filed on August 20, 2026, and a response to the petition is due September 30, 2026. The Court has not decided whether it will hear the case.
Americans for Prosperity Foundation v. Albence
District Court of Delaware
Americans for Prosperity Foundation and Americans for Prosperity have challenged the constitutionality of Delaware laws that impose disclosure requirements on organizations engaged in advocacy. Under these laws, nonprofits must disclose the identity of any donor who contributes more than $100. The lawsuit argues that these disclosure mandates violate the First Amendment rights of nonprofits, charities, and their supporters by burdening free speech and freedom of association.
Current Status: Newly filed, APF is expected to file an amended complaint on June 1, 2026.
American Alliance for Equal Rights (AAER) and Defending Education v. Congressional Black Caucus Foundation
U.S. District Court for the District of Columbia
The American Alliance for Equal Rights (AAER) and Defending Education filed an amended complaint against the Congressional Black Caucus Foundation (CBCF), challenging CBCF’s administration of the “CBC Spouses Education Scholarship.” The plaintiffs allege that the scholarship violates 42 U.S.C. § 1981 by excluding or disadvantaging non-Black applicants and by requiring applicants to reside in or attend school in a jurisdiction represented by a member of the Congressional Black Caucus.
The plaintiffs argue that the scholarship application involves a contractual relationship because applicants provide valuable consideration, including licenses permitting the use of their personal information and application materials. The second amended complaint also alleges that applicants must agree to contractual terms governing the online application platform.
CBCF moved to dismiss the first amended complaint, arguing, among other things, that race was not an eligibility criterion for the 2026 scholarship cycle, that the plaintiffs lacked standing, and that the complaint did not adequately allege intentional discrimination, but-for causation, or a contractual relationship under § 1981.
Current Status: On August 31, 2026, the plaintiffs filed a second amended complaint responding to CBCF’s motion to dismiss. The plaintiffs now allege that CBCF did not actually eliminate its race-based restriction for the 2026 cycle or, alternatively, continued to consider race and favor Black applicants through its application process and selection practices. They point to CBCF’s public descriptions of the scholarship, questions concerning applicants’ race and attendance at historically Black colleges and universities, required applicant videos, the scholarship’s historical results, and the continued use of the CBC-member district requirement. The second amended complaint also adds more detailed standing allegations concerning students who intend to apply in future scholarship cycles. CBCF’s response is pending.
Board Governance Dispute Involving the Winthrop Rockefeller Foundation
Arkansas state court (case name not publicly reported)
A dispute involving the Winthrop Rockefeller Foundation has been brought in Arkansas state court concerning the foundation’s governance and leadership transition. The matter reportedly centers on internal disagreements over board authority, fiduciary obligations, and the direction of the foundation’s grantmaking practices, including the use of “trust-based philanthropy” approaches.
Public reporting indicates that the plaintiffs sought court intervention related to leadership and governance decisions. In response, the court declined to intervene at an early stage, finding no basis to disrupt the foundation’s ongoing operations or leadership transition. As a result, the foundation has continued its activities under its existing governance structure.
Current Status: The court has declined to intervene in the dispute at this stage, and the matter does not appear to have resulted in a published opinion or final reported decision.
Formanek v. Howard II et al
Court of Appeals of Tennessee
This case concerns a dispute involving a donor-advised fund (DAF) held at the Community Foundation of Greater Memphis (CFGM). In 2011, Peter Formanek and his daughter, Robin Formanek, entered into a DAF agreement with CFGM. Under the agreement, Ms. Formanek signed as both a donor and a party to the agreement and served as a co-advisor to the fund alongside her father.
Following Mr. Formanek’s death, CFGM removed Ms. Formanek as advisor and appointed another person as the sole advisor. Ms. Formanek subsequently filed suit seeking reinstatement as advisor. The trial court dismissed her claim, concluding that the fund agreement reflected a completed charitable gift rather than an enforceable contract. Ms. Formanek has appealed that ruling.
Current status: Case is currently pending in the Tennessee Court of Appeals.
AAER vs. Hispanic Scholarship Fund
gov.uscourts.dcd.287305.45.0.pdf
United States District Court for the District of Columbia
The American Alliance for Equal Rights (AAER) has sued the Hispanic Scholarship Fund (HSF) in federal court in Washington, D.C., challenging the eligibility rules of the HSF Scholars Program, specifically the requirement that applicants “identify as being of Hispanic heritage.” The complaint asserts that this criterion excludes all non-Hispanic students, including Asian, White, Black, and Native American applicants, even when they meet every other academic and financial qualification.
AAER brings its claims under 42 U.S.C. § 1981, a provision of the Civil Rights Act of 1866 that guarantees all persons the same right to make and enforce contracts regardless of race or ethnicity. The lawsuit characterizes the HSF Scholars Program as a contract. By conditioning that contractual opportunity on Hispanic heritage, AAER argues that HSF is engaging in unlawful race-based discrimination under § 1981.
Current Status: On September 30, 2026, the court granted part of HSF’s request to dismiss the lawsuit but allowed AAER’s claim under 42 U.S.C. § 1981 to move forward. The central question is whether HSF’s Hispanic heritage requirement unlawfully limits access to contractual opportunities.
The court found that AAER has standing to sue HSF because it sufficiently demonstrated that some of its individual members were ready and qualified to apply if not for the fact they were not of Hispanic heritage. It also concluded that based on the parties’ filings, certain benefits of the HSF Scholars Program involve an exchange of promises or obligations between HSF and participating students that plausibly create a contractual relationship. At the motion to dismiss stage, the court must accept all factual allegations as true and view them in the light most favorable to the plaintiff.
The alleged contracts that the court allowed to move forward include requirements that program participants complete periodic surveys, attend certain conferences, and accept terms and conditions to gain access to an exclusive HSF platform for additional funding opportunities. Some other contracts alleged by AAER in its complaint—including the fact that applicants to the program must first agree to HSF’s general privacy policy and website terms and conditions before applying—were not found to be grounds for a § 1981 claim even under the more plaintiff-friendly standard applied at the present stage. However, because AAER only needed to show that at least one contract limited by race or ethnicity potentially exists, the § 1981 claim is allowed to move forward.
The court dismissed AAER’s Title VI claim because it found that access to federal student financial aid data does not qualify as federal financial assistance. It also declined to decide AAER’s claims under District of Columbia and California civil rights laws, explaining that the novel questions those claims raise are better addressed by state courts. AAER may pursue those claims separately in those courts.
The case will now proceed on the § 1981 claim. The court has not decided whether HSF’s Hispanic heritage requirement is unlawful; it has determined only that AAER has presented a sufficient basis for that claim to continue. HSF must file its response by October 14, 2026.
Peterson v. Christian Community Foundation, Inc. (d/b/a WaterStone)
U.S. District Court, District of Colorado
Philip Peterson, successor advisor to a $21 million DAF at Christian Community Foundation (WaterStone), alleges the sponsor cut off his access to fund information and stopped considering his grant recommendations following a breakdown in their relationship.
The case highlights a potential source of tension in the DAF structure. IRC §4966 requires donors to relinquish control, yet donors are assured they will enjoy ongoing advisory privileges. The complaint tests whether contract law can meaningfully constrain a DAF sponsor’s discretion, or whether a donor/successor’s advisory privileges may be terminated by the sponsor without recourse.
Current Status: Peterson filed a motion to dismiss. We are waiting to see the court's schedule for next steps.
Buckeye Institute v. IRS
U.S. District Court in the Southern District of Ohio
The Buckeye Institute is challenging an Internal Revenue Code provision that requires 501(c)(3) charities to disclose the names and addresses of their major donors to the IRS. Buckeye argues that this mandatory donor-identity reporting violates the First Amendment by chilling free association and deterring supporters. After the district court held that the rule must be evaluated under “exacting scrutiny,” the federal government appealed, and the case is now before the Sixth Circuit.
State of Tennessee v. United States Department of Education
United States District Court for the Eastern District of Tennessee
Tennessee, joined by Students for Fair Admissions, Inc. (SFFA), has filed a lawsuit against the U.S. Department of Education and Secretary Linda McMahon. The case challenges the Hispanic-Serving Institutions (HSI) program under Titles III and V of the Higher Education Act. At issue is a requirement that at least 25% of a school’s enrollment be Hispanic in order to qualify for certain federal grants. State leaders and SFFA argue that this threshold leaves out colleges and universities in Tennessee that meet every other eligibility measure. They contend the rule amounts to race-based discrimination, puts federal funding out of reach for many schools, and pressures institutions to alter their student demographics in ways that conflict with anti-discrimination laws.
Current Status: The case is still technically open, but the court has paused further proceedings after earlier blocking the Department of Education’s guidance. That injunction remains in place; the case has not been settled or closed but is "paused" until either party moves to reopen it.
National Religious Broadcasters v. Bessent (Formerly Werfel)
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United States District Court for the Eastern District of Texas
The National Religious Broadcasters, an association of conservative broadcasters, Intercessors for America, a conservative prayer advocacy group, and two Baptist churches in Texas filed suit against the Internal Revenue Service (IRS) claiming their right to speak freely about political candidates and issues was being “improperly chilled” by the Johnson Amendment. They asked the court to declare the Johnson Amendment unconstitutional and the court rejected their request.
The parties reached an agreement with respect to a narrow claim regarding speech by the church plaintiffs in the context of their religious services. The parties jointly asked the District Court to enter a proposed consent judgment resolving that claim and dismissing with prejudice the remaining claims.
The consent judgment would permanently enjoin the United States from enforcing the Johnson Amendment against the Plaintiffs “based on speech by a house of worship to its congregation in connection with religious services through its customary channels of communication on matters of faith, concerning electoral politics viewed through the lens of religious faith.”
On March 31, 2026, the District Court denied entry of the proposed consent judgment and dismissed the case for lack of jurisdiction holding that Plaintiffs’ claims were barred by the Anti-Injunction Act and by the federal tax exception to the Declaratory Judgment Act.
On April 22, 2026, Plaintiffs noticed their appeal to the U.S. Court of Appeals for the Fifth Circuit. The plaintiffs filed their opening brief asking the Fifth Circuit to revive their lawsuit challenging the Johnson Amendment after the district court dismissed the case without reaching the merits. They argue the court should have heard the case because they are seeking to protect their First Amendment rights, not to avoid paying taxes, and because the IRS chose not to rely on the procedural rule the district court used to dismiss the case. The appeal also raises broader questions about whether individuals and organizations must wait for the government to take enforcement action before challenging a law they believe unconstitutionally restricts their speech, and whether the Executive Branch can choose not to rely on procedural protections enacted by Congress. While the appeal does not change the current rules for charitable organizations, it could clarify when nonprofits can challenge federal tax laws that they believe restrict their constitutional rights.
Current Status: On September 21, 2026, the Government filed its opening brief asserting that the judgment of the District Court should be reversed and remanded to the District Court only as it pertained to entry of the proposed consent judgment.
The Government’s brief argued that the lower court correctly ruled that a lawsuit to restrain the assessment or collection of a tax is barred by the Anti-Injunction Act (AIA) and Declaratory Judgment Act (DJA), but that the proposed judgment the parties had agreed to falls within a narrow exception to the AIA and the court did have jurisdiction to consider and approve that proposed judgment. For any claims that go beyond the proposed judgment, however, the AIA and DJA would still apply and the court would lack jurisdiction to hear the case.
Foundation Against Intolerance and Racism, Inc. v. Steve Walker
United States District Court for the Western District of Washington
Foundation Against Intolerance & Racism (FAIR) filed a lawsuit alleging a homeownership program operated by the Washington State Housing Finance Commission violates the Equal Protection Clause. FAIR claims that the program, which offers financial assistance to first-time homebuyers, limits eligibility to certain racial and ethnic groups and is therefore discriminatory and unconstitutional.
Current Status: In July 2025, FAIR filed an amended complaint. In the amended complaint, FAIR re-allege that at least one of their members is “able and ready” to apply for the benefit (i.e., qualifies under non-racial eligibility criteria), and therefore has “standing” to sue in their own right. We are currently awaiting the State's response.
American Alliance for Equal Rights v. Kwame Raoul, James Bennett, and Alexi Giannoulias
United States District Court for the Northern District of Illinois
The American Alliance for Equal Rights (AAER) challenged Illinois' Senate Bill 2930, which mandates nonprofits to collect and publicly disclose demographic data about their staff, including race, gender, and sexual orientation. The law requires nonprofits to use state-defined demographic classifications, which the Alliance argues are irrational and offensive. AAER claims that SB 2930 violated the First Amendment by compelling speech and the Fourteenth Amendment by promoting state-ordered racial discrimination.
Current Status: In August 2025, the federal district court rejected the Alliance’s request to block the law and allowed parts of the state’s defense to move forward. The Alliance and the U.S. government have both appealed that decision to the Seventh Circuit Court of Appeals. While the appeal is underway, the lower court has paused all activity in the case and temporarily stopped Illinois from enforcing the law against two of the Alliance’s members. The case currently remains before the Seventh Circuit, no final appellate decision yet.
