The Plantation Golf Club has discriminated against women by prohibiting women from membership, playing the course as a guest, or accessing the premises beyond the parking lot. In California, all country clubs are open to men and women, except for The Plantation Golf Club, the last entity to obtain an IRS tax-exempt status for men-only clubs.
RIVERSIDE, Calif. – A lawsuit filed by JCM Farming, Inc. alleges that The Plantation Golf Club, a male-only golf club in Indio, California, is operating under the guise of a private, non-business entity under tax-exempt status IRC § 501(c)(7), and has violated the California Unruh Civil Rights Act by excluding women from membership, guest privileges, and premises access. The lawsuit also asserts that the club engages in business activities, such as agricultural ventures, and reciprocal arrangements with other clubs that exclude women. Additionally, the club is accused of sabotaging palm tree care to protect its tax-exempt status and has misrepresented these activities in tax filings over several years.
“Under California law, it is illegal for businesses or public accommodations to discriminate based on gender, among other protected characteristics. The Plantation is attempting to sidestep these laws by claiming they are private and non-commercial,” explains Tomas Morales, General Counsel for JCM Farming.
“The discriminatory and sexist policies of The Plantation deny women from California and throughout the country the opportunity to participate in California commerce fully. The fact this is happening in California, which prides itself on its progressiveness, is hard to believe. We seek to end The Plantation’s male-only rules and recover business losses caused by its intentionally discriminatory conduct.”
Background
The Plantation was the brainchild of a group of men in the late 1990s who formulated a plan to develop a male-only club and obtained an IRS tax-exempt status for men-only clubs. The Plantation became the country’s last men’s golf club to receive such status.
After purchasing a former date palm farm to develop the golf course, the mature trees still on the property were sold at great profit. At this point, The Plantation began engaging in agricultural business transactions. The Plantation Board members wanted to develop this potential income source and entered a joint venture with JCM Farming to develop and sell trees.
JCM Farming, a company led by a woman, entered a joint venture with The Plantation to grow and sell Medjool date palms, with profits split 50/50. JCM Farming relied on the expertise and representations of The Plantation that the business arrangement was appropriate and legal, and that its day-to-day activities would not impact the viability of the venture. Instead, The Plantation deliberately neglected and sabotaged efforts to reduce income from the venture, protect the club’s tax-exempt status under IRC § 501(c)(7), and misrepresented the joint venture in tax filings. In publicly filed documents, The Plantation has stated that it is still in a joint, non-golf business venture, violating anti-discrimination laws.
A later Plantation Board recognized how lucrative palm sales could be, which caused concerns it would make too much money to continue to qualify per IRC § 501(c) (7) guidelines as a private social club and prohibited it from discriminating against women. The Club would have to allow women on the premises, which it does not do, and provide women’s bathrooms and locker facilities, which it never built. The Club would also have to change the exclusionary way it engages in the common practice of club reciprocity and allow women from other clubs to play the course. Since over 70% of The Plantation’s members are not California residents, this reciprocity, which is only with other exclusive clubs, is national in scope.
The business venture was not complicated, but it did require The Plantation to follow “good farming practices” with respect to the palms. However, The Plantation’s farming practices and actions soon took a turn for the worse. The Plantation intentionally allowed the business venture trees to die by shutting off the water. The Board set aside a $3,000,000 reserve from member initiation fees to refund them if necessary due to potential liabilities.
In 2016, The Plantation sought to end the agreement, resulting in a breach of contract lawsuit by JCM Farming. The Plantation filed a cross-complaint, claiming that no contract had been breached and that it is still in business with JCM Farming. Through its own admission, The Plantation maintains that it is currently in a joint, non-golf business venture, although it does not disclose this as required on its annual Federal Form 990 tax return.
Witnesses have asserted testimony that The Plantation engages in other business activities such as:
- Hosting and compensating touring professionals at tournaments where members and male guests (only) are paid to attend.
- On-site gambling business of several of its members and professional bookmaking.
- Facilitated the on-site sale of securities/annuities between members and compensated its members for losses when these were later deemed fraudulent sales.
- Allowing members to use their cell phones on the premises for member business purposes.
- Maintaining an office safe with approximately $3 million in cash over the years to facilitate large cash transactions (e.g., cashing checks) for on- and off-course member activities. That cash was an accumulation of fees and dues that members paid for in cash.
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