Update on Huntsman Lawsuit: Ninth Circuit Reverses Trial Court

[Analytics]

1 hour ago, smac97 said:

And you said that Craig's pronouncements were "exactly right."

He was exactly right. The Church used tithing in the way Paxton described. 

1 hour ago, smac97 said:

I don't think you are situated to tell us "what he meant."

Good Lord. This from the guy who insists to my face that I don’t mean what I say I mean?

1 hour ago, smac97 said:

Most of this comes down to semantics, tortured reasoning and equivocation.  What a bizarre hill to die on.

I'm glad you see what you are doing. I mean exactly what I say I mean. Nothing more. Nothing less.

[smac97]

8 minutes ago, Analytics said:

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And you said that Craig's pronouncements were "exactly right."

He was exactly right. The Church used tithing in the way Paxton described. 

He was not exactly right when he said this: "It is disingenuous for the church to claim that no tithing funds were used to fund the City Creek Mall."  The clear implication is that tithing funds were "used to fund the City Creek Mall."  He was, instead, exactly incorrect.

Thanks,

-Smac

Edited July 24, 2024 by smac97

[Analytics]

1 hour ago, smac97 said:

I quoted, verbatim and in context, the Latter-day Saints on this board who made comments in 2012 and 2015, and then summed up:

FWIW.

That isn’t worth much because those quotes generally are not in context.

When people said things like, "the funds for the mall did not come from tithing,” they generally were not implying, “they came from investment income earned on unspent tithing which is totally not from tithing.” Rather, they are implying the money came from the Church’s business income from the for-profit side of the Church.

As a representative example, consider what Pahoran said: "I am confident that the City Creek Mall's pedigree would trace back, not to the tithing paid in St George after President Snow's famous "Windows of Heaven" talk, but to the original Zion's Co-operative Mercantile Institution."

We now know the truth--if you trace back City Creek Mall’s pedigree, some of it goes back to Ensign Peak Advisors and if you keep tracing it back, it goes back to tithing.

1 hour ago, smac97 said:

Then the fraud and breach of fiduciary duty claims aren't really worth much.

Hold the phone. Did you actually understand something I’ve said?

[Analytics]

8 minutes ago, smac97 said:

He was not exactly right when he said this: "It is disingenuous for the church to claim that no tithing funds were used to fund the City Creek Mall."  The clear implication is that tithing funds were "used to fund the City Creek Mall."  He was, instead, exactly incorrect.

Thanks,

-Smac

Do you think Pahoran was correct when he said the following?

I am confident that the City Creek Mall's pedigree would trace back, not to the tithing paid in St George after President Snow's famous "Windows of Heaven" talk, but to the original Zion's Co-operative Mercantile Institution.

Because that is what the conversation was about. Did the pedigree of some of the funding go back to tithing as Paxton was saying, or did it all go back to things like ZCMI as Pahoran was saying? 

Which of those two was more correct?

[Amulek]

1 hour ago, Analytics said:

What critics think on this issue is irrelevant. What matters is how tithe-paying members interpreted the Church’s responses over the years.

Sorry, I thought the quote you were summarizing was from a contemporary critic. If it was a historical comment from a tithe paying member I must have missed that.

 

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For example, in 2015 one believer asked this question:

One frequently hears the statement that tithing funds were not used for such and such an investment. And while I like to think that is true, I have to pause and think...if not tithing then what funds were used? Surely not Fast Offerings, too many those are even more sacred as to their dedicated use, and surely not missionary funds. So, what are these mysterious "not tithing" funds?

That question presupposes the statement “tithing funds were not used” is meant to be interpreted broadly--tithing funds weren’t used, neither directly nor indirectly.

I'm not sure that's correct. In fact, it rather sounds to me like he's skeptical tithing funds aren't being used. I don't see any evidence that he has any concept of what it might even mean to use tithing funds indirectly, so I'm not sure we can presuppose his question was meant to exclude something he doesn't even know exists as a possibility. Or are there other quotes which make that more clear?

 

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As we go through the following answers that were offered to that question by believers, [...]

Back then, many members of the Church interpreted the Church’s statements as saying the funds for the mall came from the for-profit side of the Church, not from the non-profit side. Faithful, presumably tithe-paying members who thought that included The Nehor, Robert F. Smith, Pahoran, Kim Pearson, bluebell, and James Huntsman.

In General Conference (April 2003), President Hinckley stated that the monies came from (1) commercial entities owned by the Church and (2) the earnings of invested reserve funds.

I think what you are seeing is that, at the time, a lot of people focused on (1) and virtually nobody had any real understanding of what was even meant by (2).

I don't have a problem agreeing that many members believed the funds mostly came from preexisting commercial ventures (I believe I have said as much previously), but that doesn't mean President Hinckley was lying.

 

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For my part, I always thought the Church’s statements were too vague to be relied on.

Fair enough. But I don't think vague is going to be sufficient to prove fraud or breach of fiduciary duty (or anything similar).

 

[Analytics]

1 minute ago, Amulek said:

Sorry, I thought the quote you were summarizing was from a contemporary critic. If it was a historical comment from a tithe paying member I must have missed that.

What needs to be emphasized here is that putative class consists of people who paid tithing since 1998, feel lied to, and want their money back. This lawsuit has nothing to do with general “critics.” Rather, it is about tithe payers who feel duped.

1 minute ago, Amulek said:

I'm not sure that's correct. In fact, it rather sounds to me like he's skeptical tithing funds aren't being used. I don't see any evidence that he has any concept of what it might even mean to use tithing funds indirectly, so I'm not sure we can presuppose his question was meant to exclude something he doesn't even know exists as a possibility. Or are there other quotes which make that more clear?

It's possible he had no concept of tithing funds generating interest that could then be used. However, at the time some posters, both believers and skeptics, had this concept. Craig Paxton spelled it out clearly, and in general the apologists pounced on him, apparently because they interpreted the phrase  “tithing funds will not be used” in a broad sense.

1 minute ago, Amulek said:

In General Conference (April 2003), President Hinckley stated that the monies came from (1) commercial entities owned by the Church and (2) the earnings of invested reserve funds.

I think what you are seeing is that, at the time, a lot of people focused on (1) and virtually nobody had any real understanding of what was even meant by (2).

That's basically true.

1 minute ago, Amulek said:

I don't have a problem agreeing that many members believed the funds mostly came from preexisting commercial ventures (I believe I have said as much previously), but that doesn't mean President Hinckley was lying.

From my perspective, his comments were to vague to be a lie, and were too vague to be relied on.

1 minute ago, Amulek said:

Fair enough. But I don't think vague is going to be sufficient to prove fraud or breach of fiduciary duty (or anything similar).

I don’t think vague is a lie, but I could see why an organization might have a fiduciary duty to be more transparent than the Church was so that what Hinckley meant by “reserve funds” could be understood.

[smac97]

55 minutes ago, Analytics said:

Those cases do seem to be different than the consolidated class action complaint.

Cases about fiduciary duty claims are often assessed on a case-by-case basis, so there will pretty much always be differences.  Nevertheless, the cases provide some good guidance on the application of the Ecclesiastical Abstention doctrine in this context.

55 minutes ago, Analytics said:

Those cases are people complaining about how the churches were run.

Right.  And Huntsman and his acolytes are complaining about how the Church administers its finances, which is a pretty big part of how it is run.

55 minutes ago, Analytics said:

In contrast, this one is about the church allegedly lying to donors about what it does with the money they donate.  I would think ecclesiastical abstention doctrine gives churches the right to teach whatever they want and to spend their money on anything they want, but it doesn’t give them the right to lie to the donors. 

Sure.  But the charge of "lying" only works if you re-define "tithing" to include funds which are not tithed contributions.

And asking the courts to re-define "tithing" runs smackdab into the Ecclesiastical Abstention Doctrine.

55 minutes ago, Analytics said:

Am I wrong about that?

You are wrong to stack the deck and disregard the Ecclesiastical Abstention Doctrine.

55 minutes ago, Analytics said:

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For example, here is a 2019 case from Ohio: Adkison v. Williams, 2019 Ohio 4289, Case No. 18 CA 119 (Ohio App. Oct 17, 2019) :

• "We find this {breach of fiduciary duty} claim ... {is} an attempted extension of appellants' basic legal challenge to membership removal, and thus presents an ecclesiastical question of internal congregational governance, outside of a civil court's jurisdiction."
• "'{T}he lower court has no jurisdiction over the claims brought by the individual members of the congregation ... for breach of fiduciary duty to the congregation."

Your buddies, ChatGPT and Google, apparently didn't bother to tell you about this case.

How is that case relevant?

Because it treats the breach of fiduciary duty claim as part of a intrachurch dispute.  The court calls it "an attempted extension of appellants' basic legal challenge."  I call it a pretextual cover for a disgruntled fellow to extract a pound of flesh from his former religious community.  He wants to use the courts to punish the community, but must dress his challenge in sectarian garb.  The appellate court did not buy it.

55 minutes ago, Analytics said:

That is about a guy suing because he was excommunicated. He wasn’t suing because the Church lied to him about what it did with the money he donated.

Regardless, the court construed his legal claims as "an attempted extension of appellants' basic legal challenge to membership removal, and thus presents an ecclesiastical question of internal congregational governance, outside of a civil court's jurisdiction."

I think the same or similar result will arise in the Huntsman and MDL lawsuits.

55 minutes ago, Analytics said:

I didn’t see anything in the consolidated class action suit that was distinctly religious.

Yes, they have likely reviewed Huntsman's lawsuit and its overtly religious rhetoric and come away with "Yeah, let's not do that..."

However, the MDL lawsuit is between former/disaffected Latter-day Saints and their former/current church.  And the dispute centers on tithing and how the Church spends it.  It's hard to get more "distinctly religious" than that.

Huntsman's lawsuit will likely fail because the courts will not buy the effort to re-define "tithing," and because the Ecclesiastical Abstention Doctrine disallows the claims.

The MDL lawsuit will likely fail for the same or similar reasons, and because it attempts to conflate donations to LDS Philanthropies (which are expressly not "tithes," and to which I suspect none of the plaintiffs donated (and thus lack standing to sue it)) with normative tithes and offerings.  

For me, a big indicator of the weak-tea nature of the MDL lawsuit is its "everything and the kitchen sink" approach.  The SEC and EPA matters have little or no relevance to the City Creek issue, but they're all thrown in anyway.

55 minutes ago, Analytics said:

The suit isn’t about any religious doctrine or practice.

Tithing is a "religious doctrine or practice."

Asking secular courts to (re)define "tithing" to include non-tithed monies, and then impose that definition on the Church, runs afoul of the Ecclesiastical Abstention Doctrine.

55 minutes ago, Analytics said:

The suit is about whether the brethren’s fiduciary duty extends to being honest with the membership about the Church’s finances. That isn’t a distinctly religious question.

This only works if you re-define "tithing" to include non-tithed monies. 

Defining tithing is "a distinctly religious question."

55 minutes ago, Analytics said:

Nowhere in there does it address the actual issue: does the ecclesiastical abstention doctrine give churches the right to lie to tithe-paying members about how donations will be deployed?

Stacking the deck doesn't help you. 

Nobody is suggesting that the Ecclesiastical Abstention Doctrine provides such a right. 

Your question presupposes that a "lie" is in view. 

A "lie" is only in view if and when "tithing" is re-defined to include non-tithed monies. 

Asking a secular court to re-define "tithing" and impose that definition on a religious group is at or near the pinnacle of the mountain of reasons we have the Ecclesiastical Abstention Doctrine.

55 minutes ago, Analytics said:

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This is what Huntsman and his acolytes are trying to do.  They want to use the coercive power of the courts to tell the Church what it can, and cannot, do with its money. 

That is false.

That is entirely true.  Again, from the article about the MDL lawsuit: "In addition to tithing refunds, the class-action suit calls for declaring the church’s financial practices illegal and ordering a halt to tithing altogether while accountants sort through the faith’s finances or the court appoints a special monitor."

55 minutes ago, Analytics said:

The plaintiffs in the consolidated class action case want the Church to be honest and transparent with the membership so that they can make well-informed decisions about whether or not they want to donate in the first place. 

Dodge.

A legal theory based on a supposed lack of honesty and transparency only works if the plaintiffs succeed in getting the courts to re-define "tithing" to include non-tithed funds and impose that definition on a religious group.  This is, I think, pretty clearly prohibited by the Ecclesiastical Abstention Doctrine.

55 minutes ago, Analytics said:

I don’t even know what that means, much less have an opinion on it.

And for the record, I don’t support any part of these lawsuits.

Odd, then, that you are advancing the arguments in them.

55 minutes ago, Analytics said:

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I think that is because you are only seeing what you want to see.  You underlined one part, but ignored this one: "Matters related to church governance, such as the appointment of clergy, internal church disputes, and disciplinary actions, are typically outside the jurisdiction of civil courts."

I said “that rings true to me.”

After having underlined one portion of the ChatGPT (!) quote and utterly ignoring the part about the Ecclesiastical Abstention Doctrine.

55 minutes ago, Analytics said:

Are you using your priesthood power of discernment

Classy.  What's next, a jab about my hairline?

55 minutes ago, Analytics said:

to claim that it really doesn’t ring true to me, despite the fact that I claimed it does?

I am watching you consistently ignore the Ecclesiastical Abstention Doctrine, consistently deny that your argument is based on a re-definition of "tithing," and so on.

I am extrapolating from there.

55 minutes ago, Analytics said:

I'm not an attorney, but I don’t think very much of the cases you’ve cited are relevant, because they are about different situations.

Lawyers argue this way all the time.  The law is replete with analogies.  With judges using a case or series of cases to develop a legal principle, which principle can then be deployed in ways that are quite factually distinct from the original applications.

For example, consider Pierson v. Post, one of the most famous property law cases in American history.  Here are the facts:

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Lodowick Post, a fox hunter, was chasing a fox through a vacant lot on December 10, 1802, when Pierson came across the fox and, knowing it was being chased by another, killed the fox and took it away. Post sued Pierson on an action for trespass on the case for damages against his possession of the fox. Post argued that he had ownership of the fox as giving chase to an animal in the course of hunting it was sufficient to establish possession. The trial court found in favor of Post.

On appeal after the trial, the issue put to the Supreme Court of Judicature of New York was whether one could obtain property rights to a wild animal (Ferae naturae), in this case the fox, by pursuit. The Supreme Court case was heard by Chief Justice James Kent, then one of the nation's preeminent jurists, and associate justices Daniel Tompkins (who would later become Vice President of the United States) and Henry Brockholst Livingston (who would go on to serve as a Justice of the U.S. Supreme Court).

Here's the majority opinion:

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If we have recourse to the ancient writers upon general principles of law, the judgment below is obviously erroneous. Justinian's Institutes, and Fleta, adopt the principle, that pursuit alone vests no property or right in the huntsman; and that even pursuit, accompanied with wounding, is equally ineffectual for that purpose, unless the animal be actually taken. The same principle is recognized by Bracton.

Puffendorf defines occupancy of beasts feræ naturæ, to be the actual corporeal possession of them, and Bynkershoeck is cited as coinciding in this definition. It is indeed with hesitation that Puffendorf affirms that a wild beast mortally wounded, or greatly maimed, cannot be fairly intercepted by another, whilst the pursuit of the person inflicting the wound continues. The foregoing authorities are decisive to show that mere pursuit gave Post no legal right to the fox, but that he became the property of Pierson, who intercepted and killed him.[Citations omitted]

Pierson ended up creating or introducing "a coherent principle on how property can be first possessed by a human being."  "Determining the rightful ownership of the fox involved the essence of the human notion of 'property' itself and how it is created, and for this reason Pierson v. Post is included in nearly all Anglo-American property casebooks."

Pierson is used to establish basic principles of property ownership for all sorts of things, including oil and natural gas (which, like the fox, is ferae naturae, and hence subject to the "Rule of Capture," which is that the person who captures the wild thing is entitled to ownership of it).

My point is this: If Pierson v. Post, an 1805 case from New York about two hunters chasing a fox, can be used by, say oil and gas attorneys in Houston in 2024 to make a legal point about an oil well in the Gulf of Mexico, then it just might be possible that the cases I have cited have some relevance to the lawsuits under discussion here, particularly where they A) involve intrachurch disputes, B) pertain to religious doctrines and practices, C) involve the application or non-application of the Ecclesiastical Abstention Doctrine, and so on. 

55 minutes ago, Analytics said:

I don’t see how the case law that’s been quoted indicate that churches have the legal right to lie to donors about what it does with money.

I don't see how our discussion here justifies your continued practice of skinning puppies for fun and profit.

(My, loaded statements are fun!)

55 minutes ago, Analytics said:

My approach? Do you think IRL I’m one of the attorneys representing the plaintiffs on the consolidated class action case or something?

You are making arguments to advance and defend the Huntsman and MDL lawsuits, while at the same time claiming that you "don’t support any part of these lawsuits."

I have some speculations about why you are doing this, but I'll keep them to myself.  Nevertheless, you are advancing arguments and approaches, so they are "yours."

Thanks,

-Smac

 

Edited July 24, 2024 by smac97

[smac97]

40 minutes ago, Analytics said:

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He was not exactly right when he said this: "It is disingenuous for the church to claim that no tithing funds were used to fund the City Creek Mall."  The clear implication is that tithing funds were "used to fund the City Creek Mall."  He was, instead, exactly incorrect.

Do you think Pahoran was correct when he said the following?

I am confident that the City Creek Mall's pedigree would trace back, not to the tithing paid in St George after President Snow's famous "Windows of Heaven" talk, but to the original Zion's Co-operative Mercantile Institution.

Only in an endlessly regressive sense.

Otherwise, no.

40 minutes ago, Analytics said:

Because that is what the conversation was about.

I don't think so.  The conversation was about "tithing" and whether Latter-day Saints generally understand it to mean charitable donations of 1/10th of one's income and also any other monies that are generated by the Church's investment of tithes.

40 minutes ago, Analytics said:

Did the pedigree of some of the funding go back to tithing as Paxton was saying, or did it all go back to things like ZCMI as Pahoran was saying? 

Which of those two was more correct?

In an endlessly regressive sense, both were correct.

In a reasoned, real-world setting, both were wrong, with Craig being more so.

Thanks,

-Smac

[smac97]

49 minutes ago, Analytics said:

Quote

I quoted, verbatim and in context, the Latter-day Saints on this board who made comments in 2012 and 2015, and then summed up:

FWIW.

That isn’t worth much because those quotes generally are not in context.

I quoted them verbatim, provided some context, and provided direct links to each one.

Can't get much more contextual than that.

49 minutes ago, Analytics said:

When people said things like, "the funds for the mall did not come from tithing,” they generally were not implying, “they came from investment income earned on unspent tithing which is totally not from tithing.”  

That is, I think, overwhelmingly what they were saying.  Latter-day Saints differentiate between tithes and other forms of church income:

• "Tithing and other consecrated funds"
• "the funds for the mall did not come from tithing"
• "if they say tithing money is not used for the building of things like the mall I can believe them"
• "{tithing} slips have provided ways to distinguish between various types of offerings"
• "Our leaders have stated plainly that no tithing funds were used"
• "I will continue to give whatever excess funds I can, apart from tithing, for the fast offering, for the Church Humanitarian fund, for the Perpetual Education Fund..."
• "The Church has a statement saying the money did not come from tithing funds, and specifying where it did originate."
• "{'not tithing' funds are} income from church owned businesses and sometimes from direct donations from members for a specific purpose."
• "There a great many original non-tithing sources of funds..."
• "The Church has more than one bucket of investment funds.  It has a diversified portfolio of almost all investment opportunities - stocks, bonds, real estate, etc.  Church funds, tithing funds, are not commingled with investment funds."
• "When someone at Church HQ says that no tithing funds were used, it is very likely true."
• "If the Church leaders say that no tithing funds were used, I think we ought to give them the benefit of the doubt.  There are plenty of for-profit funds available..."
• "Thus the source of funds can be completely controlled, and the money for City Creek can be certified NOT to have come out of Tithing funds."
• "I do believe that no tithing money was used for CityCreek."
• "When they say 'non tithing funds' they mean that money that people paid as tithing was not used."
• "All donations made to the Church through the donation process of each ward and branch go to this non profit entity.  This includes tithing, fast offering, missionary, perpetual education fund and humanitarian fund."
• "If the statement was made that no tithing funds were used, I am confident that is the case."

 

49 minutes ago, Analytics said:

Rather, they are implying the money came from the Church’s business income from the for-profit side of the Church.

What is this "rather" business?  What is the difference between "investment income earned on unspent tithing" and "business income from the for-profit side of the Church"?

49 minutes ago, Analytics said:

As a representative example, consider what Pahoran said: "I am confident that the City Creek Mall's pedigree would trace back, not to the tithing paid in St George after President Snow's famous "Windows of Heaven" talk, but to the original Zion's Co-operative Mercantile Institution."

We now know the truth--if you trace back City Creek Mall’s pedigree, some of it goes back to Ensign Peak Advisors and if you keep tracing it back, it goes back to tithing.

Yes, yes.  The endless regression schtick.

49 minutes ago, Analytics said:

Quote

Then the fraud and breach of fiduciary duty claims aren't really worth much.

Hold the phone. Did you actually understand something I’ve said?

One of us is critiquing the flaws in these claims, and one of us is trying to advance and justify them and their underlying arguments (while at the same time saying he doesn't support the lawsuits).

I'll let you figure out which is which.

Thanks,

-Smac

[Analytics]

1 hour ago, smac97 said:

Right.  And Huntsman and his acolytes are complaining about how the Church administers its finances, which is a pretty big part of how it is run.

The basis of the complaint is the discrepancy between how the Church administers its finances and how it represented to tithe payers how it administers its finances.

Because the allegations are about that discrepancy, I don’t see how the Ecclesiastical Abstention Doctrine shields them in this case. If the Church had a reasonable degree of transparency so that members could know how their donations would be deployed, there would be no case.

That is how I see it.

1 hour ago, smac97 said:

This only works if you re-define "tithing" to include non-tithed monies. 

I acknowledge that you keep saying this and that you think this is a clever, insightful, and/or strong argument.

However, the fact remains that James Huntsman didn’t felt lied to because he was using an idiosyncratic definition of tithing. He felt lied to because the Church misled the membership about how donations were being deployed.

1 hour ago, smac97 said:

You are making arguments to advance and defend the Huntsman and MDL lawsuits, while at the same time claiming that you "don’t support any part of these lawsuits."

I'm just trying to understand their arguments and understand why your counterarguments seem so weak.

[Stormin' Mormon]

Smac and Analytics are talking past each other because each one is using a different definition of the word "use."  Neither seems to acknowledge the manner in which the other one is using the word, and so they just keep talking past each other again and again and again. Both uses are valid, though I think Smac's is the more common sense approach.  

In one sense, a person can "use" a tool in a way that it remains available for future use.  This is the Analytics definition.  In another sense, one can "use" a resource so that it is expended and no longer available for utilization. This is the Smac definition.

I understand Analytic's position.  It would be like someone "using" valuable shares in a company as collateral for a loan.  It can be said that the shares were "used," even though they were not sold off or expended.  Those shares were an explicit part of the loan paperwork, and without them, the financial resources of the loan would not have been forthcoming.  In a similar fashion, tithing funds were "used" to generate interest income which were then used for commercial development.  Without the tithing funds being used as a tool (rather than a resource), there would have been no City Creek.

That being said, I think that normal usage of the word, as it is applied to "using" money, connotes the second definition.  Generally, when we speak of money or funds being "used" we mean that they are expended.  It is less common (though not unheard of) to speak of "using" money as leverage or collateral. 

All in all, I don't see the Hinckley statement or any other subsequent statement from Church leaders to be either fraudulent or uselessly vague.  On the contrary, using Analytic's definition strikes me as a "well, ackshully" approach to the question.  

Edited July 24, 2024 by Stormin' Mormon

[Amulek]

1 hour ago, Analytics said:

What needs to be emphasized here is that putative class consists of people who paid tithing since 1998, feel lied to, and want their money back. This lawsuit has nothing to do with general “critics.” Rather, it is about tithe payers who feel duped.

Sure, but I think it's worth noting that the class of people we are talking about here is pretty much entirely comprised of former / disaffected members.

I get that they feel lied to or duped or whatever. Heck, I feel that way pretty much every time I turn on the news (from any station).

But if we are being honest, I strongly suspect that for many (most?) of them what they really believe they were mislead about was something other than Church finances.

 

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It's possible he had no concept of tithing funds generating interest that could then be used. However, at the time some posters, both believers and skeptics, had this concept. Craig Paxton spelled it out clearly, and in general the apologists pounced on him, apparently because they interpreted the phrase  “tithing funds will not be used” in a broad sense.

My understanding is that Craig Paxton would probably be considered in the 'critic' camp at that point in time, so from my perspective it looks like you're mostly just getting reflexive pushback from faithful members who were trying to defend the prophet against accusations of lying. And it didn't help matters that there was somebody who claimed to have authoritative information about how Church finances worked who bolstered the notion that the monies came from the commercial side (even though the prophet himself had said that was just one source of funding). So yes, I think many people may have believed the funding was primarily (or exclusively) from the for-profit side of the Church's portfolio, but they were not forming that opinion based on the Church's actual statements.

 

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In General Conference (April 2003), President Hinckley stated that the monies came from (1) commercial entities owned by the Church and (2) the earnings of invested reserve funds.

I think what you are seeing is that, at the time, a lot of people focused on (1) and virtually nobody had any real understanding of what was even meant by (2).

That's basically true.

Well, even my wife will admit that I'm not always wrong.

 

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From my perspective, his comments were to vague to be a lie, and were too vague to be relied on.

I think we are likely pretty much in agreement on that front.

 

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I don’t think vague is a lie, but I could see why an organization might have a fiduciary duty to be more transparent than the Church was so that what Hinckley meant by “reserve funds” could be understood.

If that's the angle the class action suit is going to run with, I think that's going to be a difficult needle to thread. It will be interesting to see how they plan to move forward; I guess we'll see as things progress.

 

Edited July 24, 2024 by Amulek

[Analytics]

1 hour ago, smac97 said:

What is this "rather" business?  What is the difference between "investment income earned on unspent tithing" and "business income from the for-profit side of the Church"?

You really don’t know? If you don’t know the difference between the non-profit religious side of the church and the for-profit church, its no wonder you don’t understand anything I’ve been saying on these topics. 

Kim Pearson explained the difference between the two sides of the Church (his post is long, so I’ll put in bold the parts that are most relevant):

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I am a CPA who has actually worked with the Church on money issues.  I haven't seen this discussed so I will try to add something to the conversation.

The Church of Jesus Christ of Latter Day Saint has two basic legal entities that it controls.

One is the non for profit entity we all identify as the Church.  All donations made to the Church through the donation process of each ward and branch go to this non profit entity.  This includes tithing, fast offering, missionary, perpetual education fund and humanitarian fund.  Members can and do make specific donations to the Church through gifts, wills and estates.  All of these funds by law must be kept in the non for profit legal entity.  Donations from these funds can be made to other non for profit entities such as the American Red Cross.  This non for profit entity does keep some reserve funds that are invested in very conservative investments but would only sustain the operations of the non for profit entity for a very short period of time.  The non for profit entity of the Church really does operate on the donations of members.  Primary uses are buildings, missionary, education including Church schools and seminaries and fast offerings.

The second entity controlled by the Church is a for profit entity that pays taxes like any other for profit business entity.  This entity I believe includes mainly land (ranches, farms and urban real estate), investments such as stock and bonds and now days a very limited number of businesses such as Deseret News and KSL radio.  The original source of funds for these businesses came primarily from the businesses that the Church established in the late 1800's and early 1900's including ZCMI, U&I Sugar, an Insurance company and a bank.  This entity also owned significant real estate that was sold.  Over the years the Church has actively managed these businesses.  Towards the end of the twentieth century, the Church sold its ownership in many of these businesses and kept only a few that aligned with the purpose of the Church.  As you can imagine, these sales generated significant cash.  These are the source of funds used to finance City Creek.  No donations from Church members were used to finance City Creek.  That would break laws and cause the Church to lose its tax exempt status.  The Church did not use funds from donations to start the original business either.  Most of the time money was borrowed to start these businesses and the Church was the only entity large enough to secure the loans.  I am sure that it is very possible that some donations were made back then that were used to pay some of the loans back but it would have been very limited.  Most of the tithing funds back then were in kind and there just wasn't that much hard cash.  Actually many of the early businesses were partially owned and operated by general authorities who eventually donated their ownership to the Church.  Its very difficult to determine exactly where funds came by in this time period as the records just aren't that good.

The one fund referred in numerous post above by Brother Burton would be only the fund of the non for profit entity.  All donations do go into this single bank account in the United States.  The banking in all foreign countries is handled based on the laws of that foreign country.

There is no cross mingling of funds between the two entities.  The closest thing is that the living allowances for general authorities comes from the for profit entity which is allowed by law to make contributions to a non for profit entity.

Both the for profit and non profit entities have been audited both by public accounting firms and government agencies.  Believe me, the Church has very sophisticated accounting systems and employees to make sure it complies with all laws.  If the statement was made that no tithing funds were used, I am confident that is the case.  Why would the Brethren make such a statement if it were false and could be proved false very easily by either the Federal or State government and would put the Church at a high risk of government penalties.

Just my two cents based on my understanding and what limited pieces of the Church finances I have seen.

 

Do you follow that? Two entities: the Church, which is the non-profit, and a large group of corporations that pay taxes like any other for-profit business entity. "There is no cross mingling of funds between the two entities."

Ensign Peak Advisors is squarely on the non-profit side of the house. David Nielsen argues that it shouldn’t be, but for now, that is where it is.

And that  is the difference between "investment income earned on unspent tithing" and "business income from the for-profit side of the Church.” 

[Teancum]

On 7/23/2024 at 1:11 PM, Analytics said:

Yes, there is a gray area between whether transparency is present of absent. But the Church is nowhere near the gray area. I’d love to see a qualified expert witness argue I’m wrong about this.

@smac97loves to point to the lip service annual report of the internal audit committee for the church. And he continues to ignore that an internal auditors role is much different than an independent auditors role and it has nothing to do with outward facing financial transparency, of which the church has little to none.

[Teancum]

On 7/23/2024 at 1:20 PM, smac97 said:

Absent a legal duty to disclose, the level of transparency a private entity chooses to deploy is discretionary.  It's a judgment call.  I’d love to see a qualified expert witness argue I’m wrong about this.

Thanks,

-Smac

Yes it is a judgement call.  Under US law the church is under no legal obligation to publicly disclose any financial information. And the church has chosen to give absolutely no financial transparency to its members, donors or the public.

[Analytics]

4 minutes ago, Amulek said:

Sure, but I think it's worth noting that the class of people we are talking about here is pretty much entirely comprised of former / disaffected members.

I get that they feel lied to or duped or whatever. Heck, I feel that way pretty much every time I turn on the news (from any station).

But if we are being honest, I strongly suspect that for many (most?) of them what they really believe they were mislead about was something other than Church finances.

That might be true. As I’ve said multiple times, it’s been pretty obvious to me what’s been going on all along, and if James Huntsman would have asked me about it before he paid his tithing in the early 00’s, I could have explained it to him. That is why I don’t have much sympathy for his lawsuit.

But on the other hand, all these misunderstandings could have been avoided from the beginning if the Church had followed the recommendations I’ve been offering about transparency. 

Having said that, I think it is important to acknowledge the fact that the contemporaneous record indicates many faithful Latter-day Saints on this forum interpreted the Church’s statements in the same way Huntsman now claims he did. 

[smac97]

11 minutes ago, Teancum said:

Quote

Absent a legal duty to disclose, the level of transparency a private entity chooses to deploy is discretionary.  It's a judgment call.  

Yes it is a judgement call.  Under US law the church is under no legal obligation to publicly disclose any financial information.  

And yet, we have ample evidence that the Church's finances are in good order, that the Brethren are not enriching themselves, that sacred funds are being properly used, and so on.

So all this hue and cry is . . . for what, really?

11 minutes ago, Teancum said:

And the church has chosen to give absolutely no financial transparency to its members, donors or the public.

That's not so.  We have ample evidence that the Church is a good steward of its finances:

We see the Brethren not living high off the hog.  

We also see beautiful church buildings, temples, seminaries and institutes, colleges, missionary programs, family history efforts, youth programs, women's programs, Deseret Industries, Humanitarian Square, Welfare Square, canneries and storehouses, public statements about billions being spent on collaborative humanitarian efforts, and on and on and on.  

We also have the Council on the Disposition of Tithes, the Budget Committee, the Appropriations Committee, the Church Budget Office, the Church Audit Committee, and more.  

We also have a notable lack of evidence of any pattern of financial misconduct, malfeasance, etc.  Last year's SEC issue is the exception that proves this rule.

We also have the annual audit report during General Conference.

Thanks,

-Smac

[Calm]

2 hours ago, ZealouslyStriving said:

I think getting statement like that past the lawyers, PR people, etc... isn't quite as easy as we might think 

I still don’t understand.

[smac97]

19 minutes ago, Teancum said:

Quote

Yes, there is a gray area between whether transparency is present of absent. But the Church is nowhere near the gray area. I’d love to see a qualified expert witness argue I’m wrong about this.

@smac97 loves to point to the lip service annual report of the internal audit committee for the church.

Among other things, see my previous post.

19 minutes ago, Teancum said:

And he continues to ignore that an internal auditors role is much different than an independent auditors role and it has nothing to do with outward facing financial transparency, of which the church has little to none.

And you and yours continue to ignore the reality that the Church is in excellent financial condition, that it has substantial internal checks and controls on financial expenditures, that the Brethren are not enriching themselves, that we have a notable lack of evidence of any pattern of financial misconduct, malfeasance, etc. 

If the Church's finances were in disarray, or if it had some chronic or systemic issues with corruption, graft, etc., I would give your complaints more attention and consideration.  But the Church's finances are fine.  Excellent, even.  

Thanks,

-Smac

[Teancum]

On 7/23/2024 at 6:12 PM, smac97 said:

You continue to re-define "tithing" to include funds which are not tithing, and then assert that the Church used these funds (which you call "tithing") to "build a mall."

How about we all agree that the church used income earned from donations made that were designated as tithing?  So it is not tithing per say, but it is earnings from tithing and or other donations.  Ultimately all the church has started at some point from voluntary donations. 

[smac97]

24 minutes ago, Analytics said:

Quote

What is this "rather" business?  What is the difference between "investment income earned on unspent tithing" and "business income from the for-profit side of the Church"?

You really don’t know?

I'm always willing to learn.

24 minutes ago, Analytics said:

If you don’t know the difference between the non-profit religious side of the church and the for-profit church, its no wonder you don’t understand anything I’ve been saying on these topics. 

That was not my question.

24 minutes ago, Analytics said:

Kim Pearson explained the difference between the two sides of the Church (his post is long, so I’ll put in bold the parts that are most relevant):

Do you follow that? Two entities: the Church, which is the non-profit, and a large group of corporations that pay taxes like any other for-profit business entity. "There is no cross mingling of funds between the two entities."

Oh.  

So what are the names of these two "entities"?  Where are they incorporated?

24 minutes ago, Analytics said:

Ensign Peak Advisors is squarely on the non-profit side of the house.

I know that.

24 minutes ago, Analytics said:

David Nielsen argues that it shouldn’t be, but for now, that is where it is.

Yes, yes.  Also sprach David Nielsen and all that.  And David's say so is meaningful or authoritative because . . .?

Tax law is an exercise in malum prohibitum legislation.  An act is bad if the statute says its bad, and good/authorized if the statute allows it.

I strongly suspect you itemize deductions when you pay your taxes, and otherwise do things to minimize your tax obligation.  I further suspect that you do not find this to be morally reprehensible because, well, you are acting within the confines of the law.

So, as it happens, is The Church of Jesus Christ of Latter-day Saints.

24 minutes ago, Analytics said:

And that  is the difference between "investment income earned on unspent tithing" and "business income from the for-profit side of the Church.” 

You haven't explained "that" very well.  What are the two entities you are referencing here?  

Thanks,

-Smac

[smac97]

58 minutes ago, Analytics said:

The basis of the complaint is the discrepancy between how the Church administers its finances and how it represented to tithe payers how it administers its finances.  Because the allegations are about that discrepancy, I don’t see how the Ecclesiastical Abstention Doctrine shields them in this case.

The only "discrepancy" that can be alleged is based on a re-definition of tithing to include non-tithed monies.

You keep saying you are not doing that.  And if the courts were to do so, it would violate the Ecclesiastical Abstention Doctrine.

58 minutes ago, Analytics said:

If the Church had a reasonable degree of transparency so that members could know how their donations would be deployed, there would be no case.

Malarky.  The Huntsman and MDL lawsuits are predicated on allegations of fraud, not fraudulent nondisclosure.  You yourself have characterized these cases as arising from the Church lying.

58 minutes ago, Analytics said:

That is how I see it.

Yes.

You persistently refuse to evaluate the Ecclesiastical Abstention Doctrine, which affects what you "see" (and don't see).

58 minutes ago, Analytics said:

Quote

This only works if you re-define "tithing" to include non-tithed monies. 

I acknowledge that you keep saying this and that you think this is a clever, insightful, and/or strong argument.

It's a fairly simple concept, and one you refuse to address.

58 minutes ago, Analytics said:

However, the fact remains that James Huntsman didn’t felt lied to because he was using an idiosyncratic definition of tithing.

He has told the courts, over and over, that he was lied to when he was told that tithing was not used on City Creek.  That allegation only holds if he, like you, seeks to re-define "tithing" to include non-tithed monies.

58 minutes ago, Analytics said:

He felt lied to because the Church misled the membership about how donations were being deployed.

The charge that "the Church misled the membership about how donations were being deployed" only works if you re-define "tithing" to include non-tithed monies.

58 minutes ago, Analytics said:

I'm just trying to understand their arguments and understand why your counterarguments seem so weak.

Says the guy who leans almost entirely on ChatGPT and Google for his legal knowledge, while sidestepping or outright ignoring substantive case law which is quoted to him chapter and verse.

Thanks,

-Smac

[Analytics]

28 minutes ago, Stormin' Mormon said:

Smac and Analytics are talking past each other because each one is using a different definition of the word "use."  Neither seems to acknowledge the manner in which the other one is using the word...

But please remember the context. The context is what I mean when I use the word. Maybe I’m using a definition or a concept of “use” that is idiosyncratic or uncommon or confusing or wrong. Be all that as it may, my point is still my point, and I get to decide what it is. If I explicitly define the words I’m using and explicitly clarify that I’m not changing them, then you would think somebody making a good-faith effort to communicate would accept that I mean what I say I mean.

28 minutes ago, Stormin' Mormon said:

In one sense, a person can "use" a tool in a way that it remains available for future use.  This is the Analytics definition.  In another sense, one can "use" a resource so that it is expended and no longer available for utilization. This is the Smac definition.

I understand Analytic's position.  It would be like someone "using" valuable shares in a company as collateral for a loan.  It can be said that the shares were "used," even though they were not sold off or expended.  Those shares were an explicit part of the loan paperwork, and without them, the financial resources of the loan would not have been forthcoming.  In a similar fashion, tithing funds were "used" to generate interest income which were then used for commercial development.  Without the tithing funds being used as a tool (rather than a resource), there would have been no City Creek.

THANK YOU!!! I appreciate your sincere attempt to understand me.

28 minutes ago, Stormin' Mormon said:

That being said, I think that normal usage of the word, as it is applied to "using" money, connotes the second definition.  Generally, when we speak of money or funds being "used" we mean that they are expended.  It is less common (though not unheard of) to speak of "using" money as leverage or collateral. 

Perhaps, but I’d add to this that if we are talking about an account that generates investment income, the principal and interest are fungible. According to its latest disclosure and closing market prices, Ensign Peak Advisors owns 2.72 million shares of Nvidia, worth about $310,760,000. If the Church wanted to sell some of that stock to build another mall, but wanted to assure the general membership that is was using interest on tithing and not the tithing itself, how would it ensure that interest on tithing was being spent and not the actual tithing dollars themselves? Which specific shares of Nvidia should it sell? Could it use all of the money from the proceeds for the mall, or should it designate the original investment into Nvidia as “tithing” and the capital gains are not “tithing”? But what if the original shares were purchased with dollars that had been bought and sold across multiple transactions? How do you unwind all of that to get back to the original “tithing” so that it can be preserved from being “used” for the mall?

And why would the membership need such an assurance in the first place? It seems to imply that actual tithing dollars are too sacred to be deployed for a mall, but somehow are not too sacred to be used to capitalize Nvidia. Why would that be?

Because of questions like that, I believe that at the time, many members believed that in the context of Hinckley’s assurances, “tithing” was shorthand for “the money in the accounts in which tithing is deposited, which includes both tithing and investment income on unspent tithing.” That is how many members of the Church interpreted what he said. We have a contemporaneous record that proves it.

By saying that I am not suggesting in any way whatsoever that a court should impose a definition of a word onto a Church. I’m just relaying how many members of the Church understood Hinckley’s comment at the time.

Whether or not Hinckley was being misleading isn’t a matter of the religiously orthodox definitions of the words he uses. It’s a matter of how members of the community could be expected to understand him.

[smac97]

15 minutes ago, Teancum said:

Quote

You continue to re-define "tithing" to include funds which are not tithing, and then assert that the Church used these funds (which you call "tithing") to "build a mall."

How about we all agree that the church used income earned from donations made that were designated as tithing? 

I think that formulation makes things less clear.

15 minutes ago, Teancum said:

So it is not tithing per say,

I assume you mean per se (Latin for "by or in itself").

The funds used to develop City Creek were not "tithing" in any sense of the word.

15 minutes ago, Teancum said:

but it is earnings from tithing and or other donations. 

Earnings from invested reserve funds, yes.

15 minutes ago, Teancum said:

Ultimately all the church has started at some point from voluntary donations. 

This endless regression stuff doesn't work in general.  And it really doesn't work to rehabilitate claims allegting falsity in the Church's statements about tithing relative to City Creek.

Thanks,

-Smac

[Calm]

 

3 hours ago, smac97 said:

to which I suspect none of the plaintiffs donated (and thus lack standing to sue it)) with normative tithes and offerings.  

Why do you assume this?  It is very easy to donate money to these causes if my assumption that the vending machines at Christmas are run through such as well as the money collected through the humanitarian aid option on the tithing slip.

Two of the options the funds go to LDS Philanthropies, so it makes sense the third option does as well.

My guess is a high percentage of members have donated funds to LDS Philanthropies through the tithing slip’s option, but it’s pure guessing based on my own behaviour.

Edited July 25, 2024 by Calm