In 2011, the judiciary’s policy-making body, a panel overseen by Chief Justice John Roberts, received a complaint from a sitting judge after a watchdog group revealed that Clarence Thomas hadn’t reported hundreds of thousands of dollars earned by his wife.

Clarence Thomas filed amended reports, explaining that his wife’s income was “inadvertently omitted due to a misunderstanding of the filing instructions.” No formal review was conducted, though the panel asserted there was no “willful” wrongdoing by the justice.

The filing requirements themselves were porous enough, however, that justices could effectively omit naming any of their spouse’s clients or the amount of money they were receiving. Thus, in subsequent disclosures, Clarence Thomas would go on to simply list that his wife had received money from her consulting business, without detailing how much or from whom, or whether any of the people paying her had interests before the Supreme Court.

Likewise, gaps in disclosure requirements for nonprofits were large enough that no one could keep track of who was funding Leo’s network. In some instances, the gaps were exacerbated by irregularities. In 2011, JEP reported to the IRS having received no more than $50,000 in donations, even though another Leo-aligned entity, the Wellspring Committee, reported having given JEP $136,000 that year. A spokesman said JEP took in more than expected and accounted for the surplus in a subsequent reports.

The lack of a requirement to report donors became more noteworthy as JEP’s revenue began to grow.

In 2012 — the year Leo asked Conway to direct payments to Thomas through Conway’s polling business — the formerly inactive nonprofit reported receiving $1.5 million. The next year, Thomas’ former law clerk, Carrie Severino, became one of the group’s three directors; by 2014, the nonprofit’s annual revenues were up to $9 million from nothing reported just five years previously, according to tax filings.

Severino did not respond to questions through the Judicial Crisis Network, another Leo-aligned group which she heads.

Pushing an agenda

Meanwhile, JEP was becoming a major vehicle for filing amicus briefs on behalf of the conservative legal movement seeking to influence the Supreme Court. More than just expressions of support for one side or the other, these briefs often encompassed extensive fact-finding and analysis, spanning scores of pages. The goal was to offer conservative justices arguments that they could incorporate into their opinions.

The lead attorney on the first amicus brief JEP joined was former Thomas law clerk John Eastman, who would later advise Trump on theories for overturning the 2020 election. The brief argued that Obamacare’s provision requiring minimum coverage was an “oppressive mandate” and that it was “tainted” by “abuses of the legislative process.” With the support of Roberts, the court ruled against JEP’s position. Clarence Thomas, along with the other conservative justices, joined a dissent that would have found the individual mandate unconstitutional. In later years, the mandate would be effectively ended by Congress repealing its tax penalties.

Many of the JEP’s subsequent briefs listed Severino as counsel of record.

In 2013, JEP filed a Severino-authored brief arguing in favor of striking down a Massachusetts law that made it a crime to stand within 35 feet of entrances to abortion clinics. The state claimed the law was necessary to prevent clashes between demonstrators. JEP, however, argued that abortion clinics provide “incomplete and misleading information about the abortion procedure” and that the law interfered with the rights of “sidewalk counselors.” The court unanimously struck down the law, though a five-justice majority rejected JEP’s contention that the law was aimed at curbing the rights of anti-abortion protesters.

In 2014, JEP weighed in on the landmark case of Burwell v. Hobby Lobby, in which the court decided that companies can opt out of contraception coverage for employees based on the owners’ religious objections. The opinion, written by Justice Samuel Alito and joined by Clarence Thomas, adopted many of the arguments JEP made in its Severino-authored brief, mainly that Obamacare’s coverage requirements burdened the Hobby Lobby owner’s right to free exercise of religion.

In 2015, JEP filed a brief in support of a petitioner challenging a University of Texas affirmative action program, which it called a “back-door” and secretive process. Clarence Thomas and Alito agreed it was “categorically unconstitutional.” The court’s majority disagreed, but later, in 2023, a more conservative court would adopt the position advocated by JEP.

Curbing oversight

Efforts to determine who was funding such advocacy, and whether they had direct interest in the cases, are complicated by gaps in disclosure rules and oversight of nonprofit groups. The rules governing such groups were designed for traditional charities such as Kiwanis Clubs or PTAs. But once activist groups started organizing under the same tax provisions, the IRS was forced to become the arbiter of what constituted politics and what did not.

Since JEP was registered as a charity, “the [IRS] limitations are very clear that you can’t do anything engaged in politics” and cannot organize a nonprofit for the benefit of any private interest or individual, said John Koskinen, a former IRS commissioner from 2013 to 2017 who reviewed the paperwork provided by POLITICO. Though such groups can engage in advocacy and limited lobbying, they are prohibited from participating in campaigns for or against political candidates.

Those who claimed the IRS wasn’t properly scrutinizing such groups quickly ran into a powerful countermovement claiming the opposite.

Mitchell, the lawyer who had helped Thomas set up her own ill-fated nonprofit, began championing a public relations offensive to combat IRS scrutiny of the same nonprofits her allies were erecting. She claimed that the tax agency, then overseen by the Obama administration, was disproportionately targeting conservative groups and called for an independent counsel.

The agency “is so corrupt and so rotten to the core that it cannot be salvaged,” Mitchell said in 2014.

A two-year investigation by the Department of Justice “found no evidence that any IRS official acted based on political, discriminatory, corrupt or other inappropriate motives” and closed with no charges. It did find “substantial evidence of mismanagement, poor judgment and institutional inertia” as IRS officials cut corners to deal with an explosion of Tea Party-aligned nonprofit applications similar to Thomas’ group. But it also found that some progressive groups experienced similar processing delays and extra scrutiny.

Thereafter, the division that polices such nonprofits was effectively neutered by budget cuts. Audit rates plunged as the division became overwhelmed by hundreds of new nonprofits supposedly doing charitable and educational work but actually doing mostly political work. Clawing back funding for the IRS remains a top demand of conservative lawmakers in annual congressional budget negotiations.

The timing of the campaign against the IRS was no coincidence, said Koskinen, the former IRS commissioner who was in office during that period in the Obama administration.

“It shouldn’t surprise anyone that some of the people attacking the IRS and supporting cuts to its budget after 2010 were the same people pushing the envelope of how to move ‘dark money’ around to maximize its political effect,” Koskinen said. “The fewer auditors the IRS had, the lower the odds of being caught.”

Backing Trump

The election of Donald Trump in 2016 opened the door to countless new opportunities for the burgeoning conservative legal movement.

Leo himself had played a strong role in ensuring Trump’s election. When conservatives expressed doubts about the surprise GOP nominee, Leo helped reassure them by persuading Trump to commit to choosing Supreme Court nominees from a list that Leo himself drafted.

Then, after Trump’s victory, Leo worked hard to ensure that the president followed through.

When Conway joined the White House as an adviser to new president, with a hand in judicial nominations, Leo helped facilitate the sale of her polling firm to a Virginia company where he is now chairman.

Leo’s closeness to the White House sparked a fresh surge in donations to his network. In 2020, he announced JEP was being rebranded as the 85 Fund, and its annual fundraising skyrocketed to $65.7 million.

That year also marked the ultimate triumph of the conservative legal movement, as the confirmation of Justice Amy Coney Barrett established a 6-3 majority of justices aligned with Leo’s Federalist Society. Leo used his dark-money groups to fund campaigns urging the confirmation of those justices, including Barrett.

Then, as Trump approached a difficult re-election campaign in 2020, the 85 Fund created a subgroup, The Honest Elections Project, dedicated to amplifying claims of Democrats cheating in elections and pushing for voting restrictions.

Since Trump’s defeat, the Honest Elections Project has seized on momentum created by his unfounded claims of a stolen election to push anti-fraud measures that critics say will make voting harder for everyone.

“Tens of millions of voters harbor grave doubts about the future legitimacy of the democratic process,” the group says on its website. “They expect voting to be secure, accessible, and honest — even in a pandemic. What they got was an election marred by dysfunction, hundreds of agenda-driven progressive lawsuits that undermined voting safeguards, and a system that in many places failed to deliver prompt results. That is not how elections are supposed to work.”

A growing network

The Honest Elections Project is now just one limb of Leo’s fast-growing operation, fortified by what is believed to be the largest political donation in history: $1.6 billion from 91-year-old manufacturing magnate Barre Seid.

But with that immense war chest has come further scrutiny of the network’s spending. In March, POLITICO reported that since Leo became chairman of the for-profit CRC Advisors in 2020, the JEP and another Leo-affiliated group has paid the firm at least $43 million. A few weeks later, a progressive watchdog group filed a complaint with the D.C. attorney general and the IRS requesting a probe into what services were provided and whether Leo was in violation of laws against using charities for personal enrichment.

Read More