Via Naked Capitalism

By Jerri-Lynn Scofield, who has worked as a securities lawyer and a derivatives trader. She is currently writing a book about textile artisans.

Recently, I found myself on some long-haul flights during which I caught up with a handful of films I’d wanted to see, but weren’t playing at a cinema anywhere near where I was located at the time of their release.

One of these films, Vice, focused on the career and influence of Dick Cheney, and the rise of hard right, conservative politics in the US. It’s not altogether surprising that the role of Koch Brothers – specifically the Charles G. Koch Foundation – in funding and promoting the genesis and dissemination of conservative ideas – remains largely explored in cinema, although it’s alluded to in the film. Successful films generally feature finely drawn protagonists, and narrative conflict. The emphasis is on the personal, rather than systemic analysis: we watch actors act..

For enlightenment about the systemic, we must usually rely on other sources.

George Mason University (GMU) is Virginia’s largest university and is a public institution funded by the state of Virginia. The George Mason University Foundation (GMUF) is a privately held corporation established to raise funds and manage donations given for the benefit of GMU. GMU and its Mercatus Center are significant recipients of Koch and other private funding.

Students and other interested parties, including UnKoch My Campus, concerned about the possible threats this funding poses for academic freedom, sought to get GMU and GMUF to release documents under the state’s public disclosure statute,  the Virginia Freedom of Information Act (VFOIA).  Numerous shenanigans ensued. Those charged with processing the requests attempted to levy exorbitant fees – no doubt to deter the requests, GMU tried to hide behind GMUF, with GMU claiming it did not hold the relevant documents. GMUF for its part argued that as a privately held corporation, it was not bound by VFOIA.

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So, Transparent GMU sued GMU and GMUF under VFOIA, seeking the following:

For the years of 2008 through 2012, any grants, cooperative agreements, gift agreements, contracts, or memoranda of understanding (including any attachments thereto) involving a contribution to or for [GMU] from any of [several charitable foundations under Charles Koch, Claude R. Lambe, and David Koch].(opinion p. 4).

(See this account in the Fairfax County Times, Virginia Supreme Court agrees to hear GMU transparency lawsuit, for further details.)

As I wrote in May 2018 in Tyler Cowen, Koch Brothers Funding, Mercatus Center, George Mason University, and Academic Freedom, these and other initiatives spurred the release of some  emails and supporting documentation that revealed the influence donors, principally the Charles G.Koch Foundation, exerted over GMU’s economics faculty and law school.

But the plaintiffs still did not have all that they asked for.

The Circuit Court of Fairfax County dismissed GMU as a defendant to the lawsuit, leaving GMUF as the sole defendant.

On July 5, 2019, the same court rejected the plaintiff’s VFOIA claim against GMUF, finding  the GMUF was not a public body.

Transparent GMU appealed the lower court’s ruling as to GMUF. The Virginia Supreme Court considered one issue only:

The questions before us on appeal involve whether the Foundation, a privately held corporation, established to raise funds and manage donations given for the benefit of GMU, is subject to VFOIA (opinion, p. 1).

On December 12, the Virginia Supreme Court unanimously determined that GMUF’s records are not subject to VFOI disclosure.

“Evan Johns, a lawyer for Transparent GMU, said the ruling is disappointing and leaves no avenue for appeal,”  according to the Washington Post’s account, Court: university foundation exempt from public-records laws.

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I concur.

The United States Supreme Court tends not to review decisions of a state’s highest court in interpreting that state’s statutes – unless a major constitutional principle is at stake. And I think it’s safe to say that a current majority of the Supremes won’t have any interest  in reviewing a decision that allows dark sources of university funding to remain in the shadows.

So the Virginia Supreme Court’s decision will almost certainly stand. This leaves the public who finances GMU ignorant of  the terms and conditions the Kochs and other private funders impose on academics and departments that accept their contributions. So much for academic freedom….

As the WaPo notes:

Mason’s interim president, Anne Holton, said Thursday in a statement that the ruling will help private foundations continue their support for public universities.

Indeed! And we should ask why some of them provide such funding. Alas, the days when private funders donated funds for disinterested reasons are long gone – if they ever existed. (Jerri-Lynn here: my emphasis.)

Now, the court’s opinion applies to VFOIA requests only. Other states aren’t bound by Virginia law, and some of them have their own disclosure statutes. Over to the WaPo:

Court papers filed in the case show that states across the nation have issued varied rulings on the topic, depending on how each state’s laws are written.

Academic Battlegrounds

Faculties of law and economics are only two battlegrounds. Think of the other areas in which the Koch’s have interests: global warming? Environmental degradation? Plastics?

And the Kochs may be the best known bugbear, but they’re not the only funders that seek to direct academic research in a direction that accords with their own self-interest.

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Think Big Pharma. I’m sure readers can come up with many other examples of their own.

What Is To Be Done?

Those of us who rely on FOIA or its various state analogues for our work are well familiar with the deficiencies of these statutes. It’s not uncommon for holders of  documents to impose exorbitant fees to process disclosure requests. Nor are parties bound to meet the timetables specified in the disclosure statutes. So your humble researcher or journalist  makes a request, and waits years to receive a trickle of documents.

But as to GMUF and GMU, the Virginia Supreme Court has blocked even that narrow pathway.

So, if VFOIA doesn’t apply here, what other mechanisms are available to find out who pays the piper?

There are two options I can see.

The Virginia General Assembly  can amend VFOIA and make GMUF, and other similar private educational foundations, subject to its terms, going forward. Note that this can be done only prospectively, and could notably retrospectively; the Virginia legislature can not  compel GMUF to disclose existing agreements.

There are moves afoot to enact such a change and make VFOIA cover situations such as the one presented here.

Second, GMUF could voluntarily disclose the agreements at issue here, even retrospectively. I know this outcome seems unlikely, but I understand GMUF has in some cases, done so, in response to faculty requests.

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