August 13, 2014
Animal Legal Defense Fund
Registry of Charitable Trusts Office of the Attorney General, Kamala Harris P.O. Box 903447 Sacramento, CA 94203-44 70 VIA U.S. Mail
Re:
Attachment to California Form CT -9, Nature and Details of Violation by Morro Bay Marine Rehabilitation Center
Dear Attorney General Harris: On behalf of the Animal Legal Defense Fund ("ALDF"), an animal advocacy organization headquartered in California and representing more than 100,000 members and supporters nationwide, I respectfully request that you investigate the charitable status of the Morro Bay Marine Rehabilitation Center (the "Entity"), a section 501(c)(3) entity doing business as the Morro Bay Aquarium and registered as a charity with the state of California. 1 As explained below, evidence shows the Entity has, for nearly two decades, abused its federal tax exemption, making false claims about its charitable purpose and often operating in violation of federal laws meant to protect animal welfare. Since the Entity is located in Morro Bay, California, it conducts this fraud upon visitors and residents of the state, from whom it collects nearly $200,000 annually, all while presumably enjoying a state tax exemption as well. 2
A. Background The Entity is purportedly a section 501(c)(3) tax-exempt entity treated as a private foundation for federal tax purposes. The Entity is incorporated as a nonprofit formed to rehabilitate distressed marine mammals. 3 The Entity, however, does not rescue or rehabilitate marine mammals. 4 In fact, the Entity has not been authorized to rehabilitate marine mammals since 1995. 5 Instead the Entity purchases and displays mainly captive-born seals and sea lions, confining them in inhumane conditions, and charging admission to the public to view them. 6
170 East Cotati Avenue Cotati, California 94931 T 707.795.2533 F707.795.7280 info@aldf.org aldf.org
The Entity's FEIN is 77-0032171, California corporation C1240798, Charity 55098. See the Entity's 2013 Form 990-PF, showing $182,554 in admissions revenue in 2013. See Exhibit A, the Entity's Articles of Incorporation on file with the state of California. 4 See Exhibit B, letter sent to ALDF following a request to cease and desist, wherein the Entity admits it does not rehabilitate marine mammals. 5 See Exhibit C, letter revoking the Entity's authorization to rehabilitate marine mammals. Purchased seals are identified on the Entity's tax returns, Form 990-PF: In 2009, the Entity listed two seals, Socket and Achilles, as depreciating assets that were purchased on January 23, 2006, for $16,487 each. The Entity depreciated the remaining value for Achilles, indicating he died May 5, 2009. In 2010, the Entity depreciated Socket's remaining value, indicating he died April24, 2010. The Entity then began depreciating the value of two newly-acquired sea lions, Hera and Ramsey, who were purchased for $20,698 each on December 28,2009, and the value of a harbor seal, Smokey, who was purchased the same day for $16,697. These depreciations recur in 2011, 2012, and 2013.
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In recent years, the Entity has come under significant public scrutiny for the deplorable conditions in which it keeps the captive seals and sea lions. The Entity has been dubbed "Seal Guantanamo" and a "torture chamber" by its critics. One commenter noted that "[i]t should be illegal for them to have those poor seals and fish in the horrible conditions they have them in. It's absolutely sickening." 7 In fact, after inspecting the facility, the United States Department of Agriculture (the "USDA") through its Animal and Plant Health Inspection Service ("APHIS") issued numerous citations to the Entity for violations of the Animal Welfare Act (the "Act"), 7 U.S.C. §§ 2131-2159. These citations are summarized in an investigation, attached as Exhibit D, which substantiated allegations that the Entity had repeatedly failed to provide its captive animals with adequate veterinary care. The inspection reports are discussed below.
B. The Entity's Repeated Violation of Federal Law Feeding Requirements, 9 C.F.R. § 3.105 In June 2010, the USDA issued a citation (the "June 2010 Citation"), attached as Exhibit E, for the Entity's violation of 9 C.P.R. § 3.1 05, a regulation promulgated under the Act to establish feeding requirements for captive marine mammals. The APHIS inspector noted that at least one of the Entity's mammals was "significantly underweight ... [and that] [s]taffat the facility had not made any attempts to calculate the caloric needs or intake of the marine mammals being housed there." The inspector demanded that the Entity "correct [the violation] immediately." With regard to a separate violation of the same regulation, the inspector noted that the Entity discovered a decrease in appetite of one mammal, a sign of change in health status of marine mammals, and neglected to notify a veterinarian of that change for four days. The ailing mammal died on the fifth day. In yet another violation of the same regulation, the inspector noted that the Entity provided food to the animals that did not meet federal requirements for storage and which was fed to the animals after its federally mandated shelf life.
Veterinary Care, 9 C.F.R. § 3.110 Apart from its violations of the minimum feeding requirements under the Act, the Entity also violated the requirements under 9 C.F .R. § 3.11 0, the regulations requiring appropriate veterinary care. The inspector stated in the June 2010 Citation that the Entity did not maintain a separate holding facility as required by federal law, nor did it meet the minimum space requirements. The June 2010 Citation further describes that during the inspection, one sea lion had diarrhea but could not be separated from the other mammals because no separate holding space existed, causing significant contamination risk. That sea lion was "significantly underweight ... had not been weighed and no diagnostic tests had been performed." In other words, the Entity not only neglected the welfare of its other mammals, but it also neglected the welfare of the suffering sea lion. In yet another violation of 9 C.F .R. § 3.11 0, the Entity failed to comply with the requirements that the Entity maintain adequate medical records and conduct and provide necropsy reports for deceased animals. The inspector noted the death of a harbor seal one day Examples of the public outcry can be viewed on a comment site for visitors of the Entity. Some visitors of the aquarium have stated, "this is a good example of animal cruelty," "I can't believe this place hasn't been shut down by some animal rights group yet. My family used to call this place 'The Torture Chamber,"' "I have no idea why this place is still in business, but I can only hope that it is shut down immediately for the seals' sake. Those poor things would be much better off ANYWHERE else." Comments available at http://www.yelp.com/biz/morrobay-aquarium-morro-bay (last visited Aug. 13, 2014).
prior the inspection, concluding that the seal "did not receive a complete necropsy. Although the animal was exhibiting neurologic signs, the central nervous system, including the brain, was not examined and no histopathology or other lab work was obtained." Space Requirements, 9 C.F.R. ยง 3.104 The June 2010 Citation describes further violations by the Entity, which "provided only a three foot wide by six foot long platform" of dry space for the mammals. This platform is currently shared by three sea lions held captive by the Entity: an adult female and two others, a male and female, who are rapidly approaching adulthood. The average length of an adult male California sea lion, is seven feet six inches; females are slightly smaller, at six feet. 8 Given these proportions, the inspector characterized the dry resting area as "grossly insufficient for the animals housed at the facility." With regard to all of the violations shown in the June 2010 Citation, the USDA demanded immediate correction. The Entity did not, however, correct them immediately. Rather, its violations of federal law continued as documented in a report following an inspection performed nearly a month later ("the July 2010 Citation"), attached here as Exhibit F, which noted the same violations. Repeat Violations In an inspection conducted in August of 2010 (the "August 2010 Citation"), attached as Exhibit G, the USDA again determined that the Entity did not comply with federal law. The inspector identified four separate violations relating to sections 3.101 (governing facilities in general), 3. 104 (space requirements), and 3 .11 0 (veterinary care). In that report, the inspector noted in particular a male sea lion that was "observed to be significantly underweight and to have intermittent muscle tremors during the inspection ... an abnormal gait ... hitting his head once and running into a wall once." When an Entity staff member stated that the attending veterinarian would be called to examine the sea lion, the USDA inspector called the veterinarian who informed the inspector that "he was not capable of performing any diagnostic tests and could only prescribe an antibiotic .... He stated that some other veterinarian would have to be contacted to do any necessary diagnostic procedures." During another call with the attending veterinarian, that veterinarian stated that "he was not physically capable of handling any of the marine mammals at the facility and that he felt he was not up to date on pinniped medicine. " 9 The Entity houses many pinnipeds and yet retains attending veterinarians who are adtnittedly physically incapable of delivering effective medical care and who lack the medical expertise to administer a basic level of veterinary care to these animals. It is no wonder that the USDA repeatedly found deceased, underweight, and sick pinnipeds held by the Entity. 10
See http://www.nmfs.noaa.gov/pr/species/mammals/pinnipeds/californiasealion.htm (last visited Aug. 13, 2014). 9 Pinnipeds include seals, sea lions, and walruses, all of which are protected species. 10 See Exhibit D. In addition to the deaths of Socket and Achilles, discussed supra in note 6, five other captive-born pinnipeds have died within a few years of their acquisition by the Entity. These include Cajun, a seal born in 2000, purchased in 2002, who died 2003; Army, a seal born 2001, purchased in 2002, who died in 2004; Chunky, a seal born 2002, acquired in 2003, who died 2005, and two sea lions who may have been born in the Morro Bay Aquarium: Turkey, a sea lion who was born, acquired, and who died in 2003; and Lloyd a sea lion who was born and acquired in 2003, who died 2005 .
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Nearly three years later, following an inspection conducted in April2013 (the "April 2013 Citation"), attached as Exhibit H, the USDA cited the Entity for another violation of the Act, failure to maintain the enclosure in good repair. In the nearly three years that passed since the June 2010 Citation, the Entity has struggled to comply with even the most basic regulations that ensure the humane treatment of the animals it displays. This habitual and repeated pattern of disregarding the federal law governing the treatment of captive animals is wholly inconsistent with the Entity's purported charitable purpose to rehabilitate distressed marine mammals. C. Discussion The state of California allows the formation of public benefit corporations, which may qualify for tax-exempt status. The Attorney General has the authority to investigate public benefit corporations that are suspected of diverting funds from their intended purpose. Here, investigation of the Entity is proper first because the Entity lacks any clear charitable purpose. Rather, the Entity operates in violation of federal law and in tension with public policy. Even assuming a charitable purpose does exist, no funds collected by the Entity are ever spent to further this purported charitable purpose. 1. The Entity's Charitable Status Should Be Investigated Because It Has No Apparent Charitable Purpose The basis of the Entity's charitable status is not clear to ALDF. The Entity, on its Form . 990-PF, Part XVI-B, claims that the nearly $200,000 in admissions revenue it collects is related to its charitable purpose because: The aquarium has helped educated and make the general public aware of life in the ocean and the harm caused by man, other sea life, and adverse weather. Funds so generated [by admissions] are used for the rehabilitation of marine life. While the Entity claims it provides education to the public and rehabilitation to marine life, the Entity does not, to ALDF's knowledge, provide either. The Entity does not appear to offer any educational programs and does not maintain any staff in furtherance of any educational activities. With regard to the Entity's purported rehabilitative purpose, the Entity has not rescued or rehabilitated a marine mammal since April 19, 1995 when the National Oceanic and Atmospheric Administration ("NOAA") revoked the Entity's authorization to rehabilitate stranded marine mammals. 11 To the extent that the Entity has claimed a section 501(c)(3) charitable purpose that relates in any way to providing an educational benefit to the public, ALDF urges the State to closely examine whether the Entity's activities further that charitable purpose as, upon information and belief, no educational activities are conducted by the Entity. Any attempt by the Entity to characterize its exempt purpose as relating to the welfare of animals should also be carefully scrutinized in light of the revocation of the Entity's ability to engage in marine life rehabilitative activities and in light of the Entity's repeated violations of federal law, described in detail herein.
11
See Attachment B, revoking the Entity's authorization to rehabilitate stranded marine mammals following the Entity's repeated refusal to comply with the laws governing wild marine mammals.
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2. The Entity's Charitable Status Should Be Investigated Because the Entity Operates in Violation of Federal Law and Public Policy The Entity's Activities Are In Conflict with Express Statutory Restrictions
The Entity in this case has not only violated the requirements of the Animal Welfare Act as set forth in the regulations promulgated thereunder, but it has done so repeatedly as evidenced by Exhibits D-H and the findings of the USDA inspectors, some of which have been summarized above. The USDA has determined that the Entity has operated for years in a manner that is illegal insofar as it has repeatedly violated federal regulations. This fact alone provides grounds to investigate the Entity's charitable status. The Entity's Activities Are Contrary to Clearly Defined and Established Public Policy
In addition to the violations of the Act, activities contrary to established public policy provide another basis for investigating the charitable status of the Entity. The activities of the organization violate not only the public policy underlying tax exemption for a section 501 (c)(3) entity, but they also violate public policy underlying the enactment of the Animal Welfare Act. The public policy, in part, underlying the 50l(c)(3) tax exemption is clear. Specifically, an organization ought to enjoy relief from taxation where it operates in a manner that relieves the government of a burden it otherwise would have had to provide for society. 12 In this case, the Entity has claimed exemption from tax every year on the basis that it is a section 501(c)(3) organization. Exhibit D, however, establishes that the Entity has repeatedly violated federal legislation requiring humane treatment of such animals, and in doing so, has required ongoing investigation, follow-up, and enforcement by the USDA. In essence, the Entity does not relieve the government of its burden of providing for society where the Entity itself has become a burden on the USDA's Animal and Plant Health Inspection Service. Furthermore, the Entity violates the express public policy underlying the Animal Welfare Act. The Act was established in part to "insure that animals intended for use in research facilities or for exhibition purposes or for use as pets are provided humane care and treatment." 13 The Entity has violated that express policy by its inhumane mistreatment of animals as demonstrated by its failure to feed, house, and provide basic veterinary care to its captive animals. These failures are associated with, and possibly caused, at least six documented instances of premature death. 14 The Entity has become an icon for cruel and inhumane treatment of the mammals that reside there as is evidenced by the public outcry described above and as corroborated by the many USDA citations the Entity has been issued. 3. The Entity's Charitable Status Should Be Investigated Because the Activity of Displaying Captive Marine Mammals Does Not Further Any Charitable Mission, Including Education or Rehabilitation As noted above, ALDF is unaware of any actual charitable purpose held by the Entity. On information and belief, the Entity does not offer any educational programs nor does it employ any staff members toward such efforts. Accordingly, the purported charitable purpose of providing education to the public is not furthered by the Entity's activities. Similarly the Entity's 12 13
14
Rev. Rul. 75-384; 1975-2 C.B. 204; Treas. Reg. ยง 1.50l(c)(3)-l(d)(2). 7 U.S.C. ยง 2131. See Exhibit D.
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other purported charitable purpose-rehabilitating wild marine mammals-is also not furthered by the activities of the Entity, which purchases captive-born animals and then denies them routine veterinary care and basic nutrition. Even if the Entity were authorized to engage in rehabilitation of marine mammals, and assuming simply for the sake of argument that the Entity's activities qualify as rehabilitative, the Entity's display of pinnipeds purportedly undergoing rehabilitation would violate yet another federal law. Regulations promulgated under the Marine Mammal Protection Act 15 provide that "[m]arine mammals undergoing rehabilitation or pending disposition under this section shall not be subject to public display, unless specifically authorized by the Regional Director or the Office Director [NMFS] and conducted consistent with the requirements applicable to public display. Such marine mammals shall not be trained for performance or be included in any aspect of a program involving interaction with the public." 16 D. Conclusion The Entity has maintained, for decades, a series of captive-born marine mammals, confined in deplorable conditions. The Entity has not only displayed these suffering mammals, it has displayed an utter disregard for both state and federal law and established public policies, all while enjoying tax-exempt status. The state should no longer subsidize this suffering by turning a blind eye to the Entity's charade. The Entity is not a nonprofit rehabilitation center worthy of a tax break. It is nothing other than a dilapidating detention center for seals and sea lions. Accordingly, on the basis of any one of the foregoing grounds, the Entity's charitable status should be revoked.
Respectfully submitted,
c-O~ Jenni James Litigation Fellow [Enclosures] Exhibit A:
Morro Bay Marine Rehabilitation Center Articles of Incorporation
Exhibit B:
Letter to ALDF from Morro Bay Aquarium
Exhibit C:
Letter from NOAA to the Morro Bay Marine Rehabilitation Center
Exhibit D:
USDA investigation of Morro Bay Marine Rehabilitation Center
Exhibit E:
June 2010 USDA citation
Exhibit F:
July 2010 USDA citation
Exhibit G:
August 2010 USDA citation
Exhibit H:
April 2013 USDA citation
15
16
16 U.S.C. §§ 1361-1421 50 C.P.R. 216.27(c)(5).
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