Why Form a Private Membership Association?

We find ourselves in a time where privacy and the need to do business on our own terms is becoming more apparent by the day. One way to make this possible, in spite of various mandates and overreach, is by claiming the protections of a Private Membership Association. 

PMAs have a long history in the United States. Until recently they’ve been utilized mostly by certain groups who desired to keep their business private, and had a need for that. For example, natural health practitioners who wanted to recommend treatments not approved by the FDA, or private drinking clubs in ‘dry’ counties. 

The variety and application of the PMA concept is practically unlimited. Social clubs, schools, retail stores, service businesses and healthcare practices can all be structured as PMAs. Anyone who wants to do business in private with like minded individuals, without needing a license, can invoke the protections of a PMA. 

What protections would those be? The right to practice in private without seeking permission from a government agency or licensing body. The right to private contract. The right to assembly, and free speech. A properly formed PMA invokes various protections provided by the Constitution for the United States under the 1st, 4th, 5th, 9th, 10th and 14th Amendments. 

The private domain of an association is a sanctuary, constitutional shelter, shield, and domain set apart and a preserve according to a number of U.S. Supreme Court decisions.

The private domain is referred to as a “sanctuary from unjustified interference by the State” in Pierce v. Society of Sisters, 268 U.S. 510 at 534-535.  And as a “constitutional shelter” in Roberts v. United States, 82 L.Ed.2d 462 at 472.  And again as a “shield” in Roberts v. United States, supra at 474.

In addition, the U.S. Supreme Court in Thomas v. Collins, 323 U.S. 516 at 531, specifically refers to the “Domains set apart…for free assembly.” The First Amendment right to association creates a “preserve”  Baird v. Arizona, 401 U.S. 1.

In fact, according to Supreme Court opinion, the only restriction imposed on a PMA is that it may not operate in such a manner that presents “a clear and present danger of substantive evil.”

Your properly formed Private Membership Association consists of private members and is in the private domain with the protection of numerous favorable U.S. Supreme Court decisions with no decisions to the contrary to date, excepting limitations imposed upon statutorily compliant PMAs and those created for the purpose of regulation by the state, such as a Union. 

The above point is critical to understand. If your PMA is formed incorrectly, you will lose all your protections. The founding documents are the crux of the matter here. Properly formed documents keep you in the private domain. Documents mistakenly formed incorrectly, or by an attorney, will be ‘statutorily compliant’ meaning they put you in the public domain, subject to state law. So it is of utmost importance to have correctly drafted founding documents and follow the steps necessary to keep your business in the private domain, outside of local/state/federal jurisdiction. After all, that IS the entire point of forming a PMA, so you’ll want to do it right!

If you have questions about how a PMA would be a good fit for your business, school or club, please schedule a Discovery call to learn more. 

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