Big Donors Back New Group to Fight ‘Deep State’ at Supreme Court

A little-known legal group that’s quickly emerged as a top US Supreme Court litigator is helping steer a broad high court challenge to government agency power.

The New Civil Liberties Alliance identifies as nonpartisan. But it’s backed by groups tied to powerful sources of conservative funding, including billionaire Charles Koch and entities linked to legal activist Leonard Leo, who’s had direct influence over the court’s conservative makeup.

Columbia law professor Philip Hamburger founded the group in 2017 to fill a gap in the legal ecosystem: the protection of individual rights from entrenched government regulation. Its agenda of weakening the so-called administrative state is a long-sought conservative goal.

“It is certainly true that they’ve become a significant player in a relatively short time by raising some administrative law questions that hadn’t been getting as much or a lot of attention,” said Jonathan Adler, who teaches administrative law at Case Western Reserve University School of Law.

Next month, the NCLA will return to the court to fight a Trump-era rule criminally banning bump stock attachments that let semiautomatic rifles fire like a machine gun. The group is arguing in Garland v. Cargill that the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) can’t classify the device as an illegal machine gun under federal law.

In a third potential blockbuster, Murthy v. Missouri, the justices agreed to hear the government’s appeal in a case NCLA brought to stop Biden administration officials from directing social media platforms to censor misinformation about Covid-19.

“A lot of the cases we’ve brought could have been brought five or 10 years ago, or more, and no one was bringing them,” said Mark Chenoweth, NCLA’s president and chief legal officer. “The thing that sets NCLA apart is the fact that this is not a side hustle for us. This is all we do.”

Obscure Interests

NCLA’s biggest Supreme Court case, argued Jan. 17, seeks to overturn the Chevron doctrine that directs courts in regulatory fights to defer to the agency’s reasonable interpretation when the governing law is ambiguous. It’s a case that could undercut the government’s ability to set health, safety, and environmental rules that, while protecting the public, can cost businesses big money.

The group, along with attorneys at Latham & Watkins, is representing commercial herring fishermen fighting a federal regulation that requires them to pay third-party monitors to ride on their boats and collect data for fishing conservation and management in the Atlantic Ocean. Both NCLA and Cause of Action Institute, which brought the other case challenging the Chevron doctrine, have ties to Koch and his network.

Critics say groups like NCLA use third parties such as the fishermen here to obscure the corporate interests fueling legal challenges.

“Having the power of the government to regulate be assailed by one of the richest men in the world is not a good look,” Lisa Graves executive director of the progressive watchdog group True North Research, said in reference to Koch.

Last term, NCLA represented a woman in her fight to challenge the Securities and Exchange Commission’s administrative proceedings in federal court and won. The Supreme Court consolidated NCLA’s case with another against the Federal Trade Commission and ruled that people facing FTC and SEC enforcement actions can go straight to federal court with some constitutional challenges to the agencies’ structure.

NCLA says it doesn’t care about the politics of the people it represents or those they sue. Chenoweth says it’s fighting against government tools and tactics that force people to go above and beyond what laws require.

The Washington-based group lists 27 staffers online and operated on $4.82 million in revenue in 2022. Its success at the nation’s top court may be due, in part, to good timing, having started operating shortly before conservatives cemented a 6-3 majority on the court.

Eugene Volokh, a UCLA Law School professor who sits on NCLA’s board of advisors, attributes the group’s success to the people it has working there. Chenoweth, for example, was Rep. Mike Pompeo’s chief of staff before the Kansas Republican served as CIA director and then secretary of state in the Trump administration.

Jonathan Mitchell, who is an attorney on Trump’s appeal of the Colorado Supreme Court ruling that removed him from the 2024 primary ballot, is also a member of NCLA’s board of advisors and is arguing the group’s bump stock case on Feb. 28. Mitchell rose in conservative legal circles after designing a novel six-week abortion ban in Texas that left enforcement to private citizens in an effort to evade judicial review.

Web of Influence

Bloomberg Law was able to confirm using ProPublica’s Nonprofit Explorer some of the many ties both through people and money linking NCLA to top conservative donors who’ve worked to shape the court’s composition and its agenda.

The NCLA received $2.06 million from Donors Trust Inc. from 2020 to 2022, a group that got $175.6 million in funding during that time from The 85 Fund that’s linked to Leo, the Federalist Society’s former vice president, according to tax filings uncovered by Accountable.US, a progressive government watchdog organization.

The 85 Fund, which paid Leo’s public affairs firm CRC Advisors $21.4 million for services in 2022, is led by Carrie Severino, the president of the Judicial Crisis Network, which spent millions on ad campaigns to get Justices Neil Gorsuch, Brett Kavanaugh, and Amy Coney Barrett confirmed to the bench.

Gorsuch and Kavanaugh were two of the justices who seemed most skeptical about Chevron during arguments last week, while Barrett appeared uneasy about overturning precedent.

Judicial Crisis Network is a project of the Concord Fund, which got $28.9 million in 2021 from Marble Freedom Trust, a nonprofit Leo chairs, according to tax filings.

Marble Freedom Trust got a $1.6 billion donation from a single donor in 2020, the New York Times reported. It also gave $41.1 million to Donors Trust and $16.5 million to the Concord Fund that year.

Leo’s influence is like a “many tentacled octopus that is seeking to advance its objectives for restructuring American society through different avenues,” said Georgetown Law professor Caroline Fredrickson, who served as president of the progressive American Constitution Society.

Leo, in a statement provided by CRC Advisors, said “eliminating Chevron deference would help restore the branches of government to their rightful constitutional lanes and protect the dignity of the fishermen whose way of life has suffered because of increasing agency overreach.”

In a statement, Severino said, “we finally have a majority on the Supreme Court that decides cases based on the rule of law.”

In addition to Leo, NCLA also has common ties to Charles Koch and his network. The Charles Koch Institute and the Charles Koch Foundation have contributed more than $5 million to the NCLA since its start, according to tax filings. The foundation didn’t respond to a request for comment from either the nonprofit or its chair, Charles Koch.

NCLA brought Relentless Inc. v. Department of Commerce—one of two challenges to agency power the court is expected to decide before the end of June. Another nonprofit, Cause of Action Institute, filed the other lawsuit—Loper Bright Enterprises Inc. v. Raimondo. It’s linked to Americans for Prosperity Foundation, which Koch and his late brother David helped establish, according to a case the group filed at the Supreme Court in 2019. Cause of Action got $200,000 from the group in 2022 and James Valvo served as its director of policy before becoming executive director of Cause of Action Institute.

During a Jan. 18 Federalist Society webinar after the Chevron cases got argued, NCLA senior litigation counsel John Vecchione said, “it was a favorable day.”

Vecchione and litigation counsel Kara Rollins both came to NCLA from Cause of Action Institute. Vecchione served as its president and CEO, while Rollins was counsel.

‘Sour Grapes’

Chenoweth wouldn’t comment on the NCLA’s donors, but he said he’s amused by articles that talk about dark money supporting conservative groups and then list all the various benefactors.

“That said, it’s true we respect the privacy of our donors and don’t divulge who our donors are,” he said.

Any criticism about donors working to rig the courts by funding groups like NCLA is just “sour grapes from folks who are unhappy about the current makeup of the Supreme Court,” Chenoweth said.

The fact that groups on the political right get money from entities that support groups on the political right “is kind of a dog bites man story,” Adler said.

“Where else would an organization that is filing lots of lawsuits challenging aspects of the administrative state and administrative procedure get money from?” he asked.

Progressive groups also receive money from progressive donors. Accountable.US for example received $2.05 million in 2022 from the New Venture Fund, a public charity organization that works with donors to direct philanthropic capital to progressive projects, tax filings show.

Founded in 2001, the American Constitution Society was designed to be the equivalent of the Federalist Society on the left, but Fredrickson said that was in a more innocent era before they knew about the mass amount of money on the right and its agenda.

“When they’re playing with $1.6 billion, it makes everything that’s going on on the left look just like child’s play,” she said.