Child Evangelism Fellowship, sponsor of the Good News Clubs, which are religious, after-school clubs for elementary school children, filed a federal lawsuit against the San Diego City Schools, arguing that the District's discriminatory fees charged to the Good News Clubs but not to similar secular clubs are unconstitutional. CEF is represented by Mathew Staver, President and General Counsel for Liberty Counsel.

In July 1999, Child Evangelism Fellowship of Greater San Diego requested to use District facilities to hold a Good News Club after school hours. According to District Procedure 9205, "community organizations whose primary purpose is service to district youth or the general welfare of the community," including Boy Scouts, are entitled to use District facilities without charge. However, when CEF applied for use of school facilities, District officials insisted that CEF pay "fair rental value" because, the District claimed, CEF is a "church conducting religious services." From 1999 to the present, CEF has been charged fees to use the school facilities when other similar secular groups have not. Even after CEF provided District officials with U.S. Supreme Court cases which stated that Good News Clubs must be provided access to school facilities on the same terms and conditions as groups such as Boy Scouts, District officials refused to grant a fee waiver to the Good News Club. The District claimed that it was required to charge the Good News Club a fee under California law because the Good News Club is a religious organization.

Liberty Counsel has successfully represented Child Evangelism Fellowship in California and elsewhere regarding the right to use public school facilities on equal terms and conditions as other similar secular groups.

Mathew Staver commented on the lawsuit: "Imposing a financial barrier based on the religious viewpoint of groups seeking access to public property violates the First Amendment. A policy that excludes persons or groups from using school facilities or that imposes discriminatory fees, solely because of the group's religious viewpoint, is unconstitutional. Every public elementary school in the country ought to have a Good News Club. Who wouldn't want a club on campus that presents a positive message of hope and that teaches sound character and morals?