## Facts

- The Attorney General, acting under Executive Order 9835 (the federal employee loyalty program), designated several private organizations as “totalitarian, fascist, communist or subversive” and supplied the designations for government-wide use.
- Three organizations (a refugee charity, a civic friendship council, and a fraternal insurance group) alleged they engaged in lawful activities and were not disloyal to the United States.
- The organizations alleged the public and governmental dissemination of the designations caused severe reputational and economic harm, including loss of members and supporters, impaired fundraising, and related collateral consequences (including claimed effects on tax-related status and relationships).
- The organizations alleged they were listed without notice, disclosure of evidence, or an opportunity to contest the designation.
- They sought declaratory and injunctive relief, alleging the Attorney General lacked authority as exercised and that the listing violated constitutional protections, including due process and freedoms of speech and association.

## Issues

1. Whether the organizations alleged a sufficiently concrete injury to have standing to challenge their designation as “subversive” under the loyalty program.
2. Whether the Attorney General’s designations under Executive Order 9835 were subject to judicial review rather than insulated as internal, noncoercive government action.
3. Whether publicly stigmatizing organizations as “subversive” and effectively burdening their activities without notice and an opportunity to be heard stated a Fifth Amendment due process claim.
4. Whether the designations, as alleged, impermissibly burdened First Amendment interests in speech and association through indirect sanctions and “guilt by association.”

## Decision

- The Supreme Court reversed the judgments affirming dismissal and remanded with instructions to deny the motions to dismiss for failure to state a claim.
- Because the case reached the Court on motions to dismiss, the allegations of injury and illegality were taken as true for purposes of assessing the pleadings.
- A plurality concluded the complaints alleged concrete, practical harms (reputational, economic, and associational) sufficient to permit suit and to require litigation on the merits.
- Concurring Justices agreed that judicial review was available and that summary stigmatizing classifications could not be insulated from challenge where they inflicted serious disabilities.
- The Court did not produce a single majority rationale on the constitutional theories; the dispositive result was that dismissal at the pleading stage was improper.

## Legal Principles

- Organizations have standing where government action plausibly inflicts reputational stigma plus practical adverse consequences to operations, finances, and associations.
- Executive loyalty and security classifications that substantially affect private parties are not automatically nonreviewable; courts may examine whether the action is authorized and lawful.
- Government-imposed stigma disseminated through official channels, coupled with consequential burdens, may require procedural fairness; lack of notice and opportunity to respond can state a due process claim.
- Indirect penalties tied to political affiliation or ideology can implicate First Amendment protections of speech and association, including concerns about “guilt by association.”
- At the motion-to-dismiss stage, courts must allow plaintiffs to proceed when the pleadings plausibly allege unauthorized or unconstitutional administrative action causing concrete harm.

## Conclusion

The Court held that organizations labeled “subversive” under the federal loyalty program could seek judicial relief and that their complaints, alleging substantial stigma and resulting disabilities imposed without fair procedure, stated claims that could not be dismissed on the pleadings.


Joint Anti-Fascist Refugee Comm. v. McGrath, 341 U.S. 123 (1951)