The Brief

• A California judge banned the recognizable Kars4Kids jingle from state airwaves after ruling that the charity's 30-year-old car-donation advertisement misled donors through the deliberate omission of its true mission.
• An Orange County civil trial revealed that over 60% of Kars4Kids' revenue funds Oorah, a New Jersey-based Jewish outreach nonprofit that finances gap-year trips to Israel, adult matchmaking, and an Israeli building purchase.
• Kars4Kids must pull noncompliant commercials within 30 days or add "an express, audible disclosure" detailing its religious affiliation, funding destinations, and the actual age range of its beneficiaries.

Timeline:

• 2009: Pennsylvania and Oregon fine Kars4Kids for deceptive advertising practices that obscured its ties to Orthodox Jewish outreach.
• 2017: A Minnesota attorney general investigation reveals that less than 1% of state-donated funds benefited local children.
• 2021: California resident Bruce Puterbaugh files a lawsuit against the charity after learning his car donation did not support local, underprivileged children.
• 2022: Oorah spends $16.5 million on an Israeli building purchase and $437,000 on Middle East outreach.
• May 8, 2026: Judge Gassia Apkarian issues the permanent injunction against the noncompliant Kars4Kids jingle in California.
• June 2026 (30 days post-ruling): Deadline for Kars4Kids to remove noncompliant advertisements from California TV and radio airwaves.

https://www.foxla.com/news/california-bans-kars4kids-jingle

Just found out that either last year or earlier this year that a California appeals court rewrote the rules on who counts as a volunteer. The decision, handed down January 6 either 2025 or 2026 (found conflicting info), "establishes a new framework that could force organizations to rethink how they classify unpaid workers." 

But then, I found this article, apparently posted in April, saying that "a Chicago federal judge has ruled people who work in the Salvation Army’s thrift stores while enrolled the organization’s rehabilitation programs aren’t actually employees and can’t sue for allegedly unpaid wages."

The case centers on the Salvation Army's substance abuse rehabilitation programs in San Francisco, Stockton, and Chico. Three former program participants claimed they were actually employees, not volunteers, and that they worked full-time in the nonprofit's thrift stores without getting paid minimum wage or overtime. All three worked what they say were full-time hours sorting donations, unloading trucks, assisting customers, and handling various warehouse and store operations. In exchange, they received room and board, meals, small amounts of cash, and rehabilitation services, including counseling and classes.

The Salvation Army called it work therapy, designed to help participants build job skills and stay focused during recovery. The participants saw it differently, arguing they were doing the same jobs as paid employees, just without paychecks. So they filed a class action lawsuit, seeking back wages. 

A trial court sided with the Salvation Army, ruling that without an agreement to pay wages, there was no employment relationship. Case closed. 

Not so fast, said the Court of Appeal, which threw out that reasoning and sent the case back for reconsideration. 

"organizations need to document that volunteers chose to participate freely and are getting personal benefits beyond a paycheck substitute. They also need to show their programs serve legitimate purposes, not just cheap labor needs. The burden falls on employers to prove workers should be classified as volunteers, not the other way around."

But then, earlier this year, a Chicago federal judge ruled that the plaintiffs had presented “plenty of evidence that it was not a good rehabilitation program” as “‘work therapy’ was not a clinically tested method of overcoming substance abuse, many plaintiffs dropped out or could not maintain sobriety and stability after leaving the program, and the work assignments were simply menial tasks with no educational or vocational training to equip participants for advancement outside the walls” of the Salvation Army rehab program centers. “Although the scale of the operation and its arguable ineffectiveness as therapy could look like plaintiffs worked a job like any other, the economic reality is to the contrary. The relationship between plaintiffs and The Salvation Army was not employee–employer; plaintiffs were independent actors who did not reasonably expect compensation when participating in the temporary program of rehabilitation services offered by The Salvation Army.”

So, I'm not sure really where that leaves nonprofits...

https://courthousenews.com/seventh-circuit-salvation-army-work-therapy-program-doesnt-violate-forced-labor-laws/

https://www.hcamag.com/us/specialization/employment-law/california-court-redefines-salvation-army-volunteer-status-in-wage-rights-case/561284

https://www.courthousenews.com/salvation-army-rehab-center-participants-ask-seventh-circuit-to-revive-forced-labor-claims/

https://www.sheppard.com/insights/blogs/spilman-v-the-salvation-army-california-court-of-appeal-announces-a-new-framework-for-nonprofit-volunteers-in-wage-and-hour-cases

https://www.cities929.com/2026/04/03/salvation-army-rehab-enrollees-who-work-at-thrift-stores-arent-employees/

A former trainer at a Portland Orangetheory studio pleaded guilty Friday to stealing thousands of dollars that his class members donated to local charities.

Ryan Tong coached at the Slabtown gym until mid-2024, when a local TV investigation exposed that at least a dozen philanthropies never received donations from the studio's monthly charity classes.

Tong accepted donations to his personal Venmo account, promising matching funds, but the money was never passed on to the studio's designated recipients.

He pled guilty to three felony charges — aggravated theft, theft, and computer crime — admitting he kept many of the donations for himself.

Shane Winder, an investigator with the Multnomah County District Attorney's office, said Tong stole at least $24,025.

Good rule: never, ever donate to a charity through someone's personal Venmo or Paypal account. NEVER.

https://www.kgw.com/article/news/investigations/portland-orangetheory-coach-donation-theft-charity-funds-plea-guilty/283-32b7dded-1745-4e52-8dd2-efe4d1ab2593