The Internal Revenue Service dropped its case against the United Church of Christ after attorneys from Wilmer Cutler Pickering Hale and Dorr's Washington office proved that the church did not violate tax laws by having Sen. Barack Obama speak at its 50th anniversary celebration in June 2007.
In a May 13 letter to Rev. John Thomas, United Church of Christ general minister and president, the IRS said the church did not jeopardize its tax-exempt status because Obama spoke at the church as a member and not as a candidate. His speech occurred before he announced his candidacy for president. The church also told the audience that they should not engage in any political activities based on Obama’s speech, and that the church’s lawyers had laid out ground rules for the speech.
The church had also linked to the IRS’s fact sheet “Election Year Activities and the prohibition on Political Campaign Intervention for Section 501(c)(3) Organizations” on its Web site.
The church did not report the event to the IRS in advance. The IRS was alerted to allegations of tax-exemption violations through press reports and Web postings.
Wilmer partner William Wilkins and counsel Brian Menkes took the case on in February.
“This is a terrific victory. The IRS came to the right conclusion in an expedited matter. This may be the quickest turnaround in a political intervention case that I have seen,” Menkes told Legal Times.
Wilkins told The American Lawyer that had the IRS decided against the United Church of Christ, it would have raised questions about the First Amendment's application to church activities.