On January 30, the U.S. Court of Appeals for the Ninth Circuit released an unpublished memorandum opinion affirming the decision in Vision Service Plan v. United States, a 2005 district court summary judgment holding that Vision Service Plan (VSP) of California was not entitled to continued recognition of tax exemption as a social welfare organization described in Section 501(c)(4) of the Internal Revenue Code. In keeping with its informal nature, the opinion by the three-judge panel is brief, barely a page and a half of text. The court seemed to agree with at least some of the reasoning applied by Judge Karlton (E.D. Cal.) in the district court in granting the government's motion for summary judgment. Judge Karlton’s opinion had reasoned that VSP did not operate primarily to promote the common good and general welfare of the community (i.e., it was not a social welfare organization) because it operated like a for-profit business and served only the interests of VSP members, who largely were participants in employer insurance groups and Medicare and Medicaid beneficiaries.
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