Riley v. National Federation of Blind of North Carolina, Inc.
State law governing paid charity fundraisers is struck down, invalidating percentage fee limits, mandatory pre-donation disclosures, and a licensing delay that would restrict who may solicit and how.
Holding
The Court affirmed the lower court and held that North Carolina’s rules setting percentage-based 'reasonable' fees, forcing fundraisers to state past gross percentages to donors, and delaying solicitation until licensing are unconstitutional.
Real-world impact
- Blocks state percentage-based caps on professional fundraisers’ fees.
- Stops mandatory pre-donation disclosure of past gross retention percentages.
- Prevents licensing delays that force paid fundraisers to wait before soliciting.
Topics
Summary
Background
A coalition of paid fundraisers, charitable groups, and potential donors sued North Carolina over changes to its Charitable Solicitations Act. The law set a three-tier percentage test for fundraiser fees (up to 20% deemed reasonable, 20–35% suspect, over 35% presumed excessive), required fundraisers to tell each potential donor the average gross percentage previously retained, and barred professional fundraisers from soliciting until licensed while volunteers could solicit upon application. The Fourth Circuit struck these provisions down, and the Supreme Court reviewed the case.
Reasoning
The Court treated charity solicitations as fully protected speech and relied on earlier decisions that rejected fixed percentage rules for fundraising. It held that using percentage thresholds to decide whether fees are “reasonable” is insufficiently tied to preventing fraud and chills speech by forcing fundraisers into litigation. The pre-donation disclosure requirement was treated as compelled, content-based speech and not narrowly tailored. The licensing rule failed because it allowed unlimited delay before a professional could solicit, impermissibly silencing paid fundraisers without prompt review.
Real world impact
The ruling prevents North Carolina from enforcing the percentage-fee formula, the mandated on-the-spot gross-percentage disclosure to donors, and the licensing delay for paid fundraisers. The opinion notes the State may still enforce fraud laws, require financial filings to the State, and adopt narrowly drawn, unambiguous disclosure requirements instead of the challenged rules. Charities, small groups, and paid fundraisers keep broader freedom to choose fundraising methods without those specific state constraints.
Dissents or concurrances
Justice Scalia largely agreed except for a narrow point about professional-status disclosure. Justice Stevens agreed on fees and disclosure but dissented about the licensing holding. Chief Justice Rehnquist would have upheld more of the law.
Opinions in this case
- 1.Opinion 9431448
- 2.Opinion 9431449
- 3.Opinion 9431450
- 4.Opinion 9431451
- 5.Opinion 112141
Questions, answered
Ask questions about the entire case, including all opinions (majority, concurrences, dissents). Try:
- “What was the Court's main decision and reasoning?”
- “How did the dissenting opinions differ from the majority?”
- “What are the practical implications of this ruling?”