Update on Huntsman Lawsuit: Ninth Circuit Reverses Trial Court

[Calm]

1 hour ago, bluebell said:

Because tithing has a religious definition, interest on tithing is by definition, not tithing.

 

Agreed.

The other leg I believe he is using is even if it isn’t tithing , it’s from tithing, so that is indirectly from tithing.  I do believe there were some Saints who saw it that way in the past from the way they said things on the former threads and possibly now.  I don’t see it that way because in my view what gets deposited in the rainy day fund are “money received from members that are now under the stewardship of the Church”.  That’s not tithing to me because tithing is the purpose of money, not the money itself.  And when the purpose changes that cuts the connection.  The Church is not using the money as tithing as the Church does not tithe itself.  This purpose definition of tithing is where it gets into a religious discussion for me and why it always will.
 

Hope that makes sense.

[Anonymous Mormon]

On 10/2/2024 at 9:50 PM, Analytics said:

You care about the lawsuit. You are infatuated with how Judge Wilson interpreted Hinckley’s remarks. You are dedicated to framing the issue as being about whether interest is tithing in some metaphysical way.

In contrast, I don’t care about the lawsuit. But I am interested in how Latter-day Saints interpreted Hinckley’s remarks before the IRS complaint. And I am interested in the relationship between the contemporaneous record of how Latter-day Saints interpreted Hinckley’s remarks, and how James Huntsman claims he interpreted them.

@Analytics - Actually, I too am really interested in this as well - how did Latter-day Saints interpret President Hinckley's statement regarding 'earnings of invested reserve funds' I am curious to know if you have any sources from members honestly discussing his actual quote:

“funds for this have come and will come from those commercial entities owned by the Church. These resources, together with the earnings of invested reserve funds, will accommodate this program.”

 

Do you have any sources for discussion of the term 'earnings of invested reserve funds' from pre-lawsuit times?

 

On 10/3/2024 at 4:48 AM, Analytics said:

 Pahoran said that if you trace the genealogy of mall, it goes back to the Church’s pioneer-era legacy businesses and does not go back to tithing.

The not to tithing is an explicit part of what he said.

His position was further clarified when he responded to [Member Pays Tithing--> Tithing in Excess of Current Needs is Invested-->Investments Earn Return-->$$$ From This Return on Investments is Reinvested in the City Creek Mall] with the words:

Yes, I can see how someone with no awareness of history might assume some process similar to the above. I won't ask if you have a reference for your assumption, because of course we both know that you don't.

Despite @smac97 insisting otherwise, at the time Pahoran did not believe what Judge Wilson thought was so patently obvious. Pahoran was confident tithing money was not used, neither directly nor indirectly. Why? because President Hinckley said so.

I re-read this old thread and it doesn't really answer my question of how a member would interpret President Hinckley's use of the term "earnings of invested reserve funds." Here is why:

1. Time Frame - The time period of this thread is ~9 years after President Hinckley's remark. No average person can quote what he said 9 years later, so they were just going off memory. Their memory is that he said No tithing funds were used. That would have been my memory at the time as well.
   
    
2. Tone of Message - You have been misquoting Craig Paxton's flow chart. What he actually said was:

   Quote

   It is disingenuous for the church to claim that no tithing funds were used to fund the City Creek Mall. Member Pays Tithing à Tithing in Excess of Current Needs is Invested à Investments Earn Return à $$$ From This Return on Investments is Reinvested in the City Creek Mall…. Classic Money Laundering...So can the Church really claim that they didn’t use tithing funds to fund the City Creek mall? Ummm I suppose so…but is it really an honest statement to claim such or is the church just being disingenuous?

   When members of the church hear someone say the church is doing "Classic Money Laundering" and that President Hinckley is being 'disingenuous' they will immediately get defensive and push back. I think this is what Pahoran did - he remembered the statement of no tithing and forgot about the other clause and then jumped in to defend the coutnering view because someone called the church a money laundering scheme.  Like so often on this board, including between you and Smac in this specific thread, people start attacking each other and will immediately take the opposing counter viewpoint.
    So in this case, whatever Craig Paxton says is Money Laundering, people will attack, without actually digging in to investigate further.
    
3. No one in that thread seems to remember President Hinckley saying, "together with the earnings of invested reserve funds" - I find it most interesting that when Craig Paxton accuses the church of money laundering by using invested funds, he immediately gets a CFR. His response is to attack with statements like: "CFR? I"m gooing to assume that you are smart enough to follow the dots" & "Come on...surly you're not niave enough to think"  & "Now that would be naive."
   I would think that if Craig remembered this quote from President Hinckley he would have quoted it and then everyone could have parsed the quote and discussed its meaning. Instead, he chose to respond rudely and was suspended for a week because of it.
   So I don't think that anyone on this thread you keep citing is actually discussing what President Hinckley said, they are instead discussing what they remember from him saying 9 years earlier. And no one seems to remember him specifically calling out, "earnings of invested reserve funds" 

 

However, President Hinckley gave very specific language in saying, "earnings of invested reserve funds". This is the language that is in Huntsman's lawsuit and what the judges are basing their opinion on, not on what people debated with Craig Paxton 9 years later when he said the church was money laundering and that President Hinckley was being disingenuous. I find people's opinions 9-years later to be irrelevant to this case and the topic at hand.

So @Analytics do you happen to have any other good sources from faithful members discussing what the term "earnings of invested reserve funds" means?

[Calm]

Thank you, Anonymous.  I think that is overall a pretty decent summary of that thread.

Edited October 4, 2024 by Calm

[smac97]

2 hours ago, Anonymous Mormon said:

@Analytics - Actually, I too am really interested in this as well - how did Latter-day Saints interpret President Hinckley's statement regarding 'earnings of invested reserve funds' I am curious to know if you have any sources from members honestly discussing his actual quote:

“funds for this have come and will come from those commercial entities owned by the Church. These resources, together with the earnings of invested reserve funds, will accommodate this program.”

Do you have any sources for discussion of the term 'earnings of invested reserve funds' from pre-lawsuit times?

I re-read this old thread and it doesn't really answer my question of how a member would interpret President Hinckley's use of the term "earnings of invested reserve funds." Here is why:

1. Time Frame - The time period of this thread is ~9 years after President Hinckley's remark. No average person can quote what he said 9 years later, so they were just going off memory. Their memory is that he said No tithing funds were used. That would have been my memory at the time as well.
    
2. Tone of Message - You have been misquoting Craig Paxton's flow chart. What he actually said was: When members of the church hear someone say the church is doing "Classic Money Laundering" and that President Hinckley is being 'disingenuous' they will immediately get defensive and push back. I think this is what Pahoran did - he remembered the statement of no tithing and forgot about the other clause and then jumped in to defend the coutnering view because someone called the church a money laundering scheme.  Like so often on this board, including between you and Smac in this specific thread, people start attacking each other and will immediately take the opposing counter viewpoint.
    So in this case, whatever Craig Paxton says is Money Laundering, people will attack, without actually digging in to investigate further.
    
3. No one in that thread seems to remember President Hinckley saying, "together with the earnings of invested reserve funds" - I find it most interesting that when Craig Paxton accuses the church of money laundering by using invested funds, he immediately gets a CFR. His response is to attack with statements like: "CFR? I"m gooing to assume that you are smart enough to follow the dots" & "Come on...surly you're not niave enough to think"  & "Now that would be naive."
   I would think that if Craig remembered this quote from President Hinckley he would have quoted it and then everyone could have parsed the quote and discussed its meaning. Instead, he chose to respond rudely and was suspended for a week because of it.
   So I don't think that anyone on this thread you keep citing is actually discussing what President Hinckley said, they are instead discussing what they remember from him saying 9 years earlier. And no one seems to remember him specifically calling out, "earnings of invested reserve funds" 

However, President Hinckley gave very specific language in saying, "earnings of invested reserve funds". This is the language that is in Huntsman's lawsuit and what the judges are basing their opinion on, not on what people debated with Craig Paxton 9 years later when he said the church was money laundering and that President Hinckley was being disingenuous. I find people's opinions 9-years later to be irrelevant to this case and the topic at hand.

So @Analytics do you happen to have any other good sources from faithful members discussing what the term "earnings of invested reserve funds" means?

Interesting thoughts, but beyond the scope of this thread.  I would prefer to have this thread return to a discussion of Huntsman's lawsuit.

Thanks,

-Smac

[smac97]

An update on the Multi-District Litigation ("MDL") lawsuit against the Church.

1. As you may recall, a number of different "tithing"-related lawsuits have been filed against the Church in various jurisdictions, most of which have been consolidated into a single "MDL" lawsuit being heard by one federal judge in Salt Lake City.  The one non-consolidated lawsuit is the one filed by James Huntsman, which I believe is on hold pending the outcome of the MDL lawsuit.

2. In September the Church filed two Motions to Dismiss in the MDL action, one for the Church, one for Ensign Peak Advisors: 

• Motion to Dismiss (Church)
• Motion to Dismiss (EPA)

I previously summarized the contents of these Motions in September (see here), resulting in several pages of discussion/debate in this thread.

3. In November, Huntsman filed a single, consolidated response to the above Motions:

• Consolidated Memorandum in Opposition to Motion to Dismiss

Here is the outline of this opposing memo:

Quote

I. The Church Autonomy Doctrine does not Foreclose Plaintiffs’ Claims.

-A. The Doctrine is an affirmative defense which is not appropriate for decision on the pleadings.

-B. The Church Autonomy Doctrine does not apply here.

II. Plaintiffs’ claims are well-pleaded.

-A. Plaintiffs state a claim for breach of fiduciary duty.

-B. Plaintiffs state claims for fraudulent inducement and fraudulent misrepresentation.

-C. Plaintiffs state a claim for fraudulent concealment.

-D. Plaintiffs state a claim for unjust enrichment.

III. Plaintiffs’ claims are not time-barred.

A few thoughts.

• The initial "Allegations of Fact" section heavily leans into the SEC's fine against EPA.  I'm not sure how relevant this is, or whether Judge Shelby will give it much attention because it appears to presuppose culpability in the SEC matter, when in fact neither the Church nor EPA admitted to any wrongdoing in the SEC matter, which matter was instead settled with no adjudication by any Article III or other judge.  Moreover, as the Church later notes, the "whistleblower" letter and associated news items is likely far more relevant than the much later SEC letter, at least as to the statute of limitations issue.
• From the "Allegations of Fact": "LDS has continually and repeatedly represented that tithing funds are 'always used' for purposes like building construction, missionary work, education of Church members, and care for the poor and needy. CAC ¶ 54. Indeed, starting in 2012, the tithing slips emphasize that such donations will be used 'to further the Church’s overall mission.' CAC ¶ 55."  This vague stuff will likely not work to form the basis of a fraud claim.
• The MDL plaintiffs also point to LDS Philanthropies, which is odd since, IIRC, none of them has claimed to have donated any money to LDS Philanthropies.
• Notably, the MDL plaintiffs specifically allege that the Church's intended-to-induce-donations statements have been "false" because "a substantial and significant amount {of donations to the Church} is not directed to the promised good."  Case law is really clear on this point, holding that A) churches can save invested funds, B) judicial intervention as to "'how and when {a church} may spend its resources'" are matters "'ecclesiastical in nature,'" C) such an inquiry would contravene the Church Autonomy Doctrine, and D) churches can build and maintain financial reserves.  IOW, this is, I think, a really bad argument.
• The argument in section (I)(A) ("The {Church Autonomy} Doctrine is an affirmative defense which is not appropriate for decision on the pleadings") is a pretty solid (though, I think, ultimately unavailing) procedural argument.  This may be a somewhat unsettled area of law (see the Church's brief, p. 3, below).
• The argument in section (I)(B) ("The Church Autonomy Doctrine does not apply here") is, IMO, too conclusory.  But I've only skimmed it.  More later.
• One noteworthy admission appears at the bottom of page 22: "Plaintiffs do not argue that a nonprofit is not entitled to invest funds in reserve, but instead that where a nonprofit solicits donations through misrepresentations and misleading partial disclosures regarding how it will use those donations, it violates its fiduciary duty to its donors" (emphasis added).

4. On 12/19 the Church filed its Reply to the above opposing memo:

• Consolidated Reply in Support of Defendants' Motions to Dismiss  

A few thoughts:

• Overall, pretty good.  The Church's attorneys press hard on the vagueness of the MDL plaintiffs' claims, which is a major weakness of their suit.
• Both sides are pretty clearly setting up the Church Autonomy Doctrine as a central focus of the lawsuit.
• The analysis of the Charitable Solicitations Act is quite good.
• The "re-defining tithing" issue is addressed on pp. 14-15.
• The Reply addresses quite well the absence of an allegedly factually false statement made by the Church, and the absence of "particularity" as to the "reasonable reliance" and "materiality" components of a fraud claim.  As to the latter ("materiality"), I think Judge Shelby may well point to his previous finding that adjudicating "materiality" in the context of the use of tithing funds necessarily violates the First Amendment (see p. 20 of the Reply).
• The "unjust enrichment" analysis is also quite good.
• The statute of limitations points are pretty good.  Ironically, it relies on the publication date of the IRS letter, which I think Judge Shelby will take as the date on which the MDL plaintiffs "knew or should have known" about the facts giving rise to their lawsuit (as opposed to the  considerably later publication date of the SEC order).

5. Update from the Trib: Courts can’t say how a religion spends or saves its money, LDS Church argues in federal tithing case

The article basically just quotes the above filings, and provides some context for the suits.

6. The briefing on the Church's Motions to Dismiss is now complete.  The next step will be for Judge Shelby to either schedule a hearing or make a ruling on the Motion.  Given the seriousness and complexity of the lawsuit, I think Judge Shelby will almost certainly schedule a hearing, and thereafter issue a ruling on the Motion.  I think the hearing will be scheduled in the 1st quarter of 2025, or the early part of the 2nd quarter, and we will likely see a published decision from Judge Shelby in the 2nd or 3rd quarter of 2025.

7. I think Judge Shelby will grant all, or most, of the Church's Motion to Dismiss.  I think the MDL plaintiffs' lawsuit suffers from a sizable number of defects.

8. If the Church's Motion to Dismiss is granted, I am reasonably confident that the MDL plaintiffs will appeal.  The 10th Circuit Court of Appeals in Denver will likely review this matter and issue a decision in late 2025 or in 2026.  I think the Church will also win at the appellate level.  The MDL plaintiffs may try to seek review by SCOTUS, but I don't think this case merits such review, and that SCOTUS will decline to review it.  This, then, will be the end of the MDL lawsuit.

9. If the Church's Motion to Dismiss is denied, I think the Church will seek "interlocutory review" by the 10th Circuit of that denial.

10. I think that the 9th Circuit will look at Judge Shelby's decision as part of its evaluation of Huntsman's lawsuit.  Whether this happens immediately after Judge Shelby's decision, or after a review of Judge Shelby's decision by the 10th Circuit, is unclear to me.

11. I suspect that Judge Shelby's decision will be a strong indicator of the outcome of Huntsman's lawsuit.  If the Church wins in the MDL lawsuit, it will almost certainly defeat Huntsman's lawsuit.  The questions posed by the 9th Circuit during oral argument in Huntsman were pretty heavily focused on the Church Autonomy Doctrine, and I think the Church has a very strong argument on that issue.

Thanks,

-Smac

Edited December 24, 2024 by smac97

[webbles]

1 hour ago, smac97 said:

The one non-consolidated lawsuit is the one filed by James Huntsman, which I believe is on hold pending the outcome of the MDL lawsuit.

Isn't Huntsman's case waiting for the en banc ruling?  Are you saying that they are waiting on Judge Shelby to rule on his case?  Is that normal?  Since it is a different circuit court (9th vs 10th), wouldn't they just rule on it once they have a decision?

[smac97]

On 12/24/2024 at 12:09 PM, webbles said:

Isn't Huntsman's case waiting for the en banc ruling? 

Ah.  I think you are correct.

On 12/24/2024 at 12:09 PM, webbles said:

Are you saying that they are waiting on Judge Shelby to rule on his case?  Is that normal?  Since it is a different circuit court (9th vs 10th), wouldn't they just rule on it once they have a decision?

Good questions. 

Edited February 28, 2025 by smac97

[Calm]

Going to wait for Smac to show up and provide details intelligently rather than attempt it myself, so here is just a link on the latest from last Friday:

https://www.deseret.com/faith/2025/01/17/what-the-judge-did-in-fridays-federal-court-hearing-about-latter-day-saint-tithing/

[bluebell]

1 hour ago, Calm said:

Going to wait for Smac to show up and provide details intelligently rather than attempt it myself, so here is just a link on the latest from last Friday:

https://www.deseret.com/faith/2025/01/17/what-the-judge-did-in-fridays-federal-court-hearing-about-latter-day-saint-tithing/

That's a good article.  I appreciate when the news can explain law in a way that everyone can understand.

[Anonymous Mormon]

3 hours ago, Calm said:

Going to wait for Smac to show up and provide details intelligently rather than attempt it myself, so here is just a link on the latest from last Friday:

https://www.deseret.com/faith/2025/01/17/what-the-judge-did-in-fridays-federal-court-hearing-about-latter-day-saint-tithing/

@smac97 - Is there a video or audio recording for this most recent trial, just like the last one you linked to?  I immensely enjoyed listening to the last one and it gave me a lot of context for the case. I sure hope this one has the same option.

[JAHS]

Podcast reviewing the current lawsuit of 9 plaintiffs with reporter Tony Semerad.
https://www.podbean.com/ep/pb-dg5ys-17c2b06

[smac97]

Update: The Church has defeated James Huntsman's lawsuit:

Alert: LDS Church prevails as federal appeals court tosses out James Huntsman’s tithing lawsuit

Quote

An appeals court has thrown out Utahn James Huntsman’s fraud lawsuit against The Church of Jesus Christ of Latter-day Saints over million of dollars of tithing.

In a unanimous ruling, the 9th U.S. Circuit Court of Appeals said no reasonable juror could have concluded that the Utah-based faith misrepresented the source of funds it used to spend $1.4 billion on the building and development of City Creek Center, the church-owned mall and residential towers in downtown Salt Lake City.

"In a unanimous ruling."  By the Ninth Circuit Court of Appeals.  Via en banc review.  

Wow.  Wow.  It's a bummer that sacred funds had to be paid in legal fees to fight this case, but I am glad the Church's money was well-spent on its legal representation.  Kudos to the Church's attorneys for bringing this one home.  I do not think the Church could have achieved any more potent and favorable outcome than this one.

"{N}o reasonable juror could have concluded that the Utah-based faith misrepresented the source of funds."

That sounds right.

Quote

Huntsman, while living in California, sued the church in 2021, alleging he was fraudulently misled by statements from church leaders, including then-President Gordon B. Hinckley, that no tithing would be used on commercial projects.

“The church had long explained that the sources of the reserve funds included tithing funds,” according to an opinion summary from the appellate court, “and Huntsman had not presented evidence that the church did anything other than what it said it would do.”

The court’s members also ruled that the church autonomy doctrine, protecting faiths from undue legal intrusion, “had no bearing in this case because nothing in the court’s analysis of Huntsman’s fraud claims delved into matters of church doctrine or policy,” the court summary says.

Huh.  I wonder if Judge Shelby will reach the same conclusion.

Quote

Individual judges on the panel differed on that point, with appellate Judges Daniel Bress agreeing there was no fraudulent misrepresentation on the church’s part. But Bress also found “there was no way in in which Huntsman here could prevail,” according to the summary, “without running headlong into basic First Amendment prohibitions on courts resolving ecclesiastical disputes.”

Judge Patrick J. Bumatay, who was among the 9th Circuit members who grilled Huntsman’s lawyers in oral arguments in September, also agreed with Friday’s decision. But he, too, found problems with Huntsman’s case on religious grounds.

“Because Huntsman’s claims involve court interference in matters of religious truth,” the court wrote in its summary, “the church autonomy doctrine bars reaching the merits of his claims.”

So it sounds like some on the en banc court did feel that the Church Autonomy Doctrine applies.

In a sense, perhaps the court's non-reliance on this Doctrine is the best outcome for the Church.  If the court had applied the Doctrine, our critics would almost certainly have said something like "Yeah, well, the Mormon Church was dishonest, but they got away with it by relying on a legal loophole/technicality."  Moreover, if the Ninth Circuit has applied CAD, I think Huntsman would have been more likely to seek review by SCOTUS, and I think SCOTUS might have been more inclined to grant such review (because CAD is an important constitutional principle).

Instead, we have the Ninth Circuit essentially declaring as a factual matter that the Church was honest and accurate in its statements regarding how it used its funds.  And since the decision did not "reach" the constitutional dimensions of Huntsman's lawsuit (which were, nevertheless, addressed well in the concurring opinions), I think Huntsman will be far less likely to seek an appeal.

IOW, thanks, Ninth Circuit!

Quote

It was not immediately clear Friday morning if there was a legal path to appeal or if Huntsman would do so.

This story will be updated.

I suspect Huntsman will throw in the towel.  Had the Ninth Circuit premised its decision on the Church Autonomy Doctrine, Huntsman may have been willing to proceed with a (likely Quixotic) attempt to appeal to the U.S. Supreme Court.  As it is, the Ninth Circuit's ruling does not seem to cover any new legal ground, so there's no reason for SCOTUS to consider it on appeal (and the statistical likelihood of SCOTUS doing so was always tiny anyway).

I am very happy with this outcome.

Thanks,

-Smac

 

 

Edited January 31, 2025 by smac97

[smac97]

Here is the link to the decision itself:

https://cdn.ca9.uscourts.gov/datastore/opinions/2025/01/31/21-56056.pdf

Thanks,

-Smac

[Benjamin McGuire]

23 minutes ago, smac97 said:

I am very happy with this outcome.

That was an interesting read. I am also happy with this outcome. I enjoyed Bress's opinion a great deal. I found the discussion about the problem of allowing the plaintiff the right to define the language of the defendant - especially in the religious context where the defendant by definition is recognized as having the right of definition was really well done. The further recognition here that to allow this to happen would create infringing government intrusion was an important point (apart from the first amendment concerns). And so while I think that it's good that the main opinion was ruled entirely within the basis of the fraud claims, I appreciated the clarity that the second opinion offered on the question of the Constitutional protections given to the Church:

Quote

First, for Huntsman to prevail, a court or jury would need to agree with his view of what “tithing funds” in the Church includes. But that would intrude on the Church’s authority to define that divine concept for itself.

Anyway, thanks for posting Spencer.

[smac97]

A few thoughts from a quick read of the decision:

1. The decision is 63 pages long in PDF form.  The substantive legal analysis begins on page 13 of the PDF.  

2. The key bit about the fraud analysis:

Quote

No reasonable juror could conclude that the Church misrepresented the source of funds for the City Creek project.  Although the Church stated that no tithing funds would be used to fund City Creek, it also clarified that earnings on invested reserve funds would be used.  The Church had long explained that the sources of the reserve funds include tithing funds.  Huntsman has not presented evidence that the Church did anything other than what it said it would do. 

President Hinckley qualified the assertion that tithing funds would not be used by noting that earnings on invested reserve funds would be used.  In his 2003 announcement of the City Creek project, Hinckley stated: 

Quote

[T]ithing funds have not and will not be used to acquire this property.  Nor will they be used in developing it for commercial purposes.  

Funds for this have come and will come from those commercial entities owned by the Church.  These resources, together with the earnings of invested reserve funds, will accommodate this program. 

(Emphasis added).  That statement thus drew a distinction between principal tithing funds, coming directly from Church members, and earnings on the funds that the Church sets aside from its annual income (which includes tithing funds).  The four subsequent statements that Huntsman points to, which state without qualification that tithing funds were not used for City Creek, can only be understood within the context of Hinckley’s earlier statement distinguishing between tithing funds and earnings on reserves, and they therefore do not support Huntsman’s fraud claim. 

Yep.  Pretty plain-jane application of the law here.  I can't imagine Huntsman wanting to pay his lawyers more money to try to get SCOTUS to consider this case.  It's too mundane.  It doesn't plow any new ground, and the only new ground that could have been plowed would have been the Church Autonomy Doctrine, which the primary opinion did not use.  

Conversely, an adverse ruling against the Church would have given it plenty of incentive to seek SCOTUS review.

3. The Ninth Circuit also goes into the tithing-as-principal-and-also-earnings argument:

Quote

Because each relevant Ensign Peak account held enough earnings on invested funds to cover the funds appropriated for City Creek, any commingling of principal tithing funds and earnings on invested tithing funds cannot support Huntsman’s fraud claim. 

Nielsen’s declaration does not contradict the conclusion that Ensign Peak held sufficient earnings on invested reserve funds to fund the project without using principal tithing funds.  Nielsen testified that Ensign Peak’s senior leadership and other employees “referred to . . . all [Ensign Peak funds] as ‘tithing’ money, regardless of whether they were referring to principal or earnings on that principal,” and that the approximately $1.4 billion that Ensign Peak appropriated for City Creek came from tithing funds.  The presentation slide that Nielsen submitted with his declaration indicated that “1,400mm over 5 years” was withdrawn from Ensign Peak’s “investment reserves” for City Creek.  Even accepting the facts asserted in Nielsen’s declaration as true, they do not show that principal tithing funds were used for the City Creek project.  Neither Nielsen’s statement nor the Ensign Peak presentation slide distinguished between principal and earnings, so neither contradicts President Hinckley’s public statement that only earnings would be used.  They also do not conflict with Ensign Peak’s financial records, which show that Ensign Peak held sufficient earnings on reserve funds to finance City Creek. 

Moreover, even accepting Nielsen’s account that Ensign Peak employees used “tithing” to refer interchangeably to both principal and earnings, that does not support Huntsman’s claim because President Hinckley drew a distinction between those types of funds in his public statements.5  And Nielsen’s additional assertion that Ensign Peak President Clarke told him that the organization took steps to obscure the source of funds for City Creek is similarly inapposite.  Even if true, that assertion does not show that the Church’s public statements about the funding for City Creek were misrepresentations. 
...
In sum, on this record, no reasonable juror could conclude that the Church made a “knowingly false representation of fact” to Huntsman about the source of funds for the City Creek project.
...
5. We need not determine whether Nielsen, a former employee at Ensign Peak, has any authority to speak for the Church about the meaning of “tithing,” because Nielsen’s statements do not conflict with President Hinkley’s statements. 

"{N}o reasonable juror could conclude that the Church made a 'knowingly false representation of fact' to Huntsman about the source of funds for the City Creek project."

Yep.

4. The substantive analysis is quite brief, going from pp. 13-18 of the decision.  This is the "primary opinion" of the Ninth Circuit, and the one that creates precedent.  It was a unanimous decision, so there was no "minority" opinion.  Judge Friedland wrote it, and five others (Judges Murguia, Owens, Sung, Sanchez and De Alba) joined in it.

The rest of the decision (pp. 19-63) is taken up with two concurring opinions, one authored by Judge Bress (and joined - mostly - by Judges Smith, Nguyen and Vandyke) and the other by Judge Bumatay (writing singly).  (In a federal appellate context, a concurring opinion is a separate written opinion by one or more judges who agree with the majority's decision but for different reasons or with additional legal reasoning.)

5. In the Bress Concurrence, the four judges delve into the Church Autonomy Doctrine ("CAD") :

Quote

A more complete portrait of this lawsuit than the majority opinion offers helps to show how this case is on a collision course with the First Amendment.  
...
The purported dispute in this case concerns Huntsman’s allegation that senior Church leaders lied to congregants about whether tithed funds would be used for the City Creek project.
...
In this lawsuit, Huntsman alleges that this statement by the prophet of the Church, along with other similar statements by Church leaders and in official Church publications, misled him about whether “tithing funds” would be used for the City Creek project.  
...
Huntsman’s complaint lays bare his broad disagreement with the direction of the Church.  It opens with a quote from Church prophet Brigham Young, claiming that had the Church “heeded these profound words,” Huntsman would not have filed his lawsuit.  The complaint then goes on to express Huntsman’s “[h]ope[]” that “this lawsuit will put an end to the LDS Corporation’s lies and deceit once and for all so that the Church can refocus its attention and efforts on following the path of righteousness and honesty paved by its former leaders.”  The complaint further promises that if Huntsman prevails, “[h]e will then use the recovered funds to benefit organizations and communities whose members have been marginalized by the Church’s teachings and doctrines, including by donating to charities supporting LGBTQ, African-American, and women’s rights.” 

As the Church has noted in its briefing, Huntsman has also used his lawsuit to criticize the Church in the media.  See, e.g., Washington Post, He was Mormon royalty. Now his lawsuit against the church is a rallying cry, Sept. 9, 2023.  For example, in one interview, and in response to the question of what was “at stake in your lawsuit, beyond the tithing you’re seeking to recoup,” Huntsman offered that he “hope[d] the LDS Church will finally get serious about deploying its massive billions of dollars to help society instead of, when asked about its wealth management strategy, using meaningless answers such as saving for a rainy day or preparing for the return of Jesus.”  Salt Lake City Tribune, James Huntsman on the LDS Church: Why he left it, sued it, and what he hopes to change in it, Oct. 29, 2023. 

IIRC, I think I predicted that Huntsman would come to regret his published-to-the-world philosophical criticisms of the Church in connection with his lawsuit, as those criticisms made his position look much more like an internecine dispute than a secular one about fraud claims.

6. The Bress Concurrence goes on to disagree with the primary opinion's take on CAD (emphases added) :

Quote

It is possible to resolve this case as the majority does, by taking Huntsman’s allegations at face value and finding that on their surface, President Hinckley did not say that earnings on tithed funds would not be used for the City Creek project.  President Hinckley, in other words, did not say what Huntsman says he said.  As the majority therefore correctly concludes, “Huntsman has not presented evidence that the Church did anything other than what it said it would do.”  Every judge on this en banc court to reach the question concludes the same, as did the district court.   

But the majority’s lawyerly comparison of President Hinckley’s statements with other Church comments and financial documents should not obscure a more fundamental point of constitutional principle: that the First Amendment’s protections for religious organizations would have never permitted Huntsman to prevail.  Had the case gone further, it would have required the courts to resolve a religious disagreement, a transparent fight about the current course of the Church masquerading as a civil lawsuit.  The First Amendment would clearly prohibit this.  Indeed, it is the First Amendment’s protections that most properly frame the central and unavoidable problem with this case. 

Wow.

7. The Bress Concurrence goes on at some length to explain the purposes of CAD, saying that Huntsman's lawsuit, had it continued, "would violate core First Amendment principles.  It would do so in two main ways."  The first ostensible violation of the First Amendment addresses a point I have been noting for some years now, namely, the intrinsic dispute about the definition of "tithing."  It is some really good legal writing, so I will quote it in its near entirety, and bold the parts I find most illuminating:

Quote

First, for Huntsman to prevail, a court or jury would need to agree with his view of what “tithing funds” in the Church includes.  But that would intrude on the Church’s authority to define that divine concept for itself. 

In the Church, the duty to tithe is a religious commandment from God.  Doctrine & Covenants 119:3–4.  What that duty embodies, and what the concept of “tithing” means—including whether “tithing funds” includes earnings on tithed funds—are questions of a religious dimension.  These matters are for the Church to decide on its own, within the decision-making hierarchy it establishes.  “It is not within ‘the judicial function and judicial competence’ . . . to determine” whether Huntsman or the Church “has the proper interpretation of” Church practice and belief.  United States v. Lee, 455 U.S. 252, 257 (1982) (quoting Thomas v. Review Bd. of Ind. Emp. Sec. Div., 450 U.S. 707, 716 (1981)). 

According to the Church, “tithing funds” does not include the earnings on such funds.  This is not mere lawyerspeak.  This interpretation, the Church says, came directly from the authority of President Hinckley—at the time, “God’s prophet on the earth” whose religious pronouncements are authoritative.  Doctrine & Covenants 21:5.  As President Hinckley described it at an earlier General Conference, “[t]ithing is the Lord’s law of finance.”  Vindicating Huntsman’s position would effectively take away from the Church the authority to articulate, through its divinely inspired spiritual leader, the contours of holy funds, a matter of core religious significance.  The district court below thus had it right: “determining whether the term ‘tithing funds’ encompasses earnings on invested tithing funds would require an analysis of Church doctrines and teachings.”  That is “a religious dispute the resolution of which . . . is for ecclesiastical and not civil tribunals.”  Milivojevich, 426 U.S. at 709. 

Huntsman cannot override the First Amendment’s protections by abstracting the Church’s statements about tithing from their religious context.  President Hinckley was not addressing investors in a company.  He was not required to speak through generally accepted accounting principles.  President Hinckley was speaking as a prophet of God at a spiritual convocation about, among other things, funds the payment of which is required by divine revelation.  Even religious tenets that “might seem incredible, if not preposterous,” may not be “subject to trial” on “their truth or falsity.”  United States v. Ballard, 322 U.S. 78, 87 (1944).  The issues of religious teaching and practice at issue here are not simply secular matters that a court could resolve against the Church. 

It is therefore irrelevant that, in stylized form, the elements of a fraud claim can have a secular orientation.  It is likewise irrelevant that terms like “income” and “reserved funds” can have secular meanings.  The question here is not whether it is possible to recast Huntsman’s argument in secular terms, without the religious trappings.  The Supreme Court has confronted analogous situations in which disputes involving religious organizations could have been characterized in secular terms, but the Court held that the Religion Clauses and church autonomy principles prevented judicial resolution.  See, e.g., Milivojevich, 426 U.S. at 70910 (property disputes); Kedroff, 344 U.S. at 119 (corporate structure dispute); Presbyterian Church, 393 U.S. at 442–47 (trespass dispute). 
...
That a litigant invokes a state-law prohibition on fraud, even though “a valid and neutral law of general applicability,” id. at 190, does not sideline the church autonomy doctrine.  Religious disputes restated in the elements of a fraud claim do not lose their inevitably religious character, just as employment disputes involving persons with religious duties cannot be regarded as purely secular, either.   

In this case in particular, it is startling to think that courts and juries would be examining a religious sermon for “accuracy,” much less concluding that the leader of a worldwide religion intended to defraud his congregants on religious matters that the Church’s canonical texts commit to his rightful authority.  Nothing says “entanglement with religion” more than Huntsman’s apparent position that the head of a religious faith should have spoken with greater precision about inherently religious topics, lest the Church be found liable for fraud.  

How could this lawsuit proceed further without putting the Church of Jesus Christ of Latter-day Saints on trial for its own beliefs?  To prove a fraud claim, a plaintiff must show not only that the defendant made a misrepresentation, but that the defendant did so with knowledge of its falsity and an intent to defraud.  See, e.g., Small v. Fritz Cos., 65 P.3d 1255, 1258 (Cal. 2003).  The Church’s ultimate defense to Huntsman’s claim is that his subjective understanding of tithing is simply wrong as a matter of Church doctrine and practice, and that President Hinckley did not intend to defraud when he spoke as God’s prophet on Earth.  But the prospect of Church leaders being cross-examined on matters of religious understanding is deeply unsettling.  And any effort to limit the Church to “secular” defenses would implicitly deem illegitimate the very system of beliefs and governance that define the Church as a religious institution and that lie at the heart of the First Amendment’s protections for religion. 

It is understandable that even members of the same religion may have different views on religious practices and requirements.  But it is up to members of the Church to work through these issues among themselves and through their own processes.  Religious disagreements are to be worked out within the faith.  See Watson, 80 U.S. at 729 (“It is of the essence of these religious unions, and of their right to establish tribunals for the decision of questions arising among themselves, that those decisions should be binding in all cases of ecclesiastical cognizance, subject only to such appeals as the organism itself provides for.”).  Indeed, we have reasoned that “[c]ourts generally do not scrutinize closely the relationship among members (or former members) of a church.”  Paul v. Watchtower Bible & Tract Soc. of N.Y., Inc., 819 F.2d 875, 883 (9th Cir. 1987). 

In treating “tithing” in the Church of Jesus Christ of Latter-day Saints as an ambiguous concept that could be given meaning through law, facts, and evidence, Huntsman’s lawsuit presupposes that religious authorities could be subject to judicial review on core questions of religious belief.  That would be a serious affront to the church autonomy doctrine and the First Amendment values it represents.2 

Great stuff.

8. The above footnote also bears some attention (also bolded by me) :

Quote

In treating “tithing” in the Church of Jesus Christ of Latter-day Saints as an ambiguous concept that could be given meaning through law, facts, and evidence, Huntsman’s lawsuit presupposes that religious authorities could be subject to judicial review on core questions of religious belief.  That would be a serious affront to the church autonomy doctrine and the First Amendment values it represents.2 
...
2. The Church acknowledges, and I agree, that the church autonomy doctrine would not immunize religious leaders from fraudulently enriching themselves under the guise of religion.  Although courts may not evaluate the validity of religious beliefs—a problem that is more immediate in cases like this involving suits by disaffected church members against a church—courts do not violate the First Amendment in assessing whether asserted beliefs are sincerely held.  See United States v. Rasheed, 663 F.2d 843, 847–49 (9th Cir. 1981) (explaining, in the context of a fraud prosecution of religious leaders for what “was essentially a Ponzi scheme,” that “the sincerity of the [defendants] claiming to hold such beliefs can be examined”); see also United States v. Seeger, 380 U.S. 163, 184–85 (1965) (explaining, in the context of draft exemptions, that a court’s “task is to decide whether the beliefs professed by a registrant are sincerely held”); Kennedy v. Bremerton Sch. Dist., 597 U.S. 507, 525 (2022); Cutter v. Wilkinson, 544 U.S. 709, 725 n.13 (2005).  Of course, in this case there is no suggestion that the City Creek project involves self-dealing on the part of Church leaders.  

I am glad the Church acknowledged that CAD is not a universal bar to civil claims.

9. The Bress Concurrence goes on to describe a second ostensible violation of the First Amendment if Huntsman's lawsuit were to proceed (bolded emphases added) :

Quote

Second, for Huntsman to prevail, a court or jury would further need to agree that he reasonably relied on the Church’s alleged misrepresentations.  But that too would embroil the courts in a sectarian dispute. 
...
Huntsman claims that he believed, based on President Hinkley’s April 2003 General Conference remarks and other Church statements, that no tithing principal or earnings would be used to finance City Creek, and that Huntsman would not have made tithes if he had known otherwise.  But to conclude that Huntsman’s asserted reliance was justifiable, we would need to decide that a reasonable member of the Church of Jesus Christ of Latter-day Saints would pay tithing based on the Church’s representations about its spending decisions.  That inquiry would quickly devolve into questions about religious doctrine.  The Church explains that the religious obligation to tithe exists irrespective of how the funds are used.  See Amicus Br. of J. Reuben Clark Soc’y, at 17–21; The Church of Jesus Christ of Latter-day Saints, Tithing and Charitable Donations, http://tinyurl.com/bddan639 (“For Latter-day Saints, tithing is a natural and integrated aspect of their religious belief and practice . . . Latter-day Saints make charitable donations because they believe in fulfilling God’s commandment to tithe and give to the poor.  All funds given to the Church by its members are considered sacred.”).  Huntsman himself agreed in this litigation that “[w]hen [he] made tithing contributions, he believed he was obeying one of God’s commandments and would receive blessings from God for doing so.” 

But because Huntsman now argues that he made tithing contributions conditioned on certain understandings about how tithed funds would be used, to rule in his favor a factfinder would need to credit his position notwithstanding its evident contradiction with Church teachings.  This would leave courts and juries making determinations about why a reasonable member of the Church of Jesus Christ of Latterday Saints would or should tithe.  These are inherently religious questions.  They would require courts “to determine matters at the very core of religion—the interpretation of particular church doctrines and the importance of those doctrines to the religion.  Plainly, the First Amendment forbids civil courts from playing such a role.”  Presbyterian Church, 393 U.S. at 450. 

The plaintiff in this case is free to criticize his former Church and advocate for Church reforms.  But he cannot ask the judiciary to intrude on the Church’s own authority over core matters of faith and doctrine.  That is the lesson of this lawsuit.  We as courts are not here to emcee religious disputes, much less decide them.  The First Amendment restricts our role as it protects religious organizations from lawsuits such as this. 

Good stuff, all.

10. The Bumatay Concurrence is a bit more brief.  From the summary:

Quote

Judge Bumatay concurred in the judgment only, because it is necessary to decide this case on church autonomy grounds. Because Huntsman’s claims involve court interference in matters of religious truth, the church autonomy doctrine bars reaching the merits of his claims. 

11. The Church has been wholly vindicated in the Huntsman lawsuit.  The only disagreement in the Ninth Circuit was whether the CAD applies, and even that was a very close call.  As it is, the Ninth Circuit entirely vindicated Pres. Hinckley and the Church on the merits and the facts.  Again: "As the majority therefore correctly concludes, 'Huntsman has not presented evidence that the Church did anything other than what it said it would do.' Every judge on this en banc court to reach the question concludes the same, as did the district court."

12. For my part, I think the concurring judges have the better argument about CAD's applicability.  However, the primary opinion's non-application of CAD both

• A) vindicates Pres. Hinckley's honesty (which some, including people on this very board, had impugned) because the decision was based on the facts of the case, and not based on cutting off judicial inquiry by applying CAD;
• B) likely guts any incentive for Huntsman to appeal (which, I think, would have been more likely had the primary opinion applied CAD, which might have resulted in the Ninth Circuit plowing new ground relative to CAD, which might have, in turn, made SCOTUS more likely to hear an appeal, and which may have incentivized Huntsman to seek such further SCOTUS review); and
• C) likely creates a pretty potent "persuasive authority" for Judge Shelby to apply in the case currently pending before him in Utah. 

13. As to item 12(C) above, from ChatGPT:

Quote

In a legal context, precedent is divided into two categories: mandatory authority and persuasive authority. The key difference lies in whether a court is obligated to follow a particular precedent or if it may choose to consider it.

1. Mandatory Authority (Binding Precedent)

✅ Definition: Legal decisions that a court must follow when deciding a case.
✅ Sources:

• Decisions from a higher court in the same jurisdiction.
• U.S. Supreme Court rulings (binding on all U.S. courts).
• Circuit Court of Appeals decisions (binding on lower federal courts within the same circuit).
• State Supreme Court rulings (binding on all lower state courts in that state).

✅ Example:

• A federal district court in California must follow precedent from the Ninth Circuit Court of Appeals.
• A state trial court in Texas must follow the Texas Supreme Court's rulings.

---

2. Persuasive Authority (Non-Binding Precedent)

✅ Definition: Legal decisions that a court may consider but is not required to follow.
✅ Sources:

• Decisions from courts in other jurisdictions.
• Lower court rulings in the same jurisdiction.
• Legal treatises, law review articles, and academic commentary.
• Unpublished or non-precedential opinions.

✅ Example:

• A federal court in New York may look at a Ninth Circuit decision for guidance but is not bound by it.
• A California state court might consider how New York courts handled a similar legal issue but is not required to follow it.

The Ninth Circuit's decision in Huntsman is not binding on Judge Shelby because Utah is in the Tenth Circuit.  Nevertheless, I would bet real money on Judge Shelby ending up quoting and relying on Huntsman in dismissing the MDL lawsuit.

14. I am very happy, but not really surprised, at this outcome.

Thanks,

-Smac

Edited January 31, 2025 by smac97

[smac97]

3 hours ago, Benjamin McGuire said:

That was an interesting read.

When I was in law school ('01-'04), most of the appellate opinions we read/studied, particularly the older ones, were pretty densely-written.  Bookish.  Kinda hard to follow.  And they also tended to be a bit more long-winded, and also boring.

With the advent of the Internet, I think appellate courts are adapting their prose to make their decisions more accessible to everyday readers.  This opinion had plenty of meat on the bone in terms of legal analysis, but it was, as you say, "an interesting read" as well.  I am glad of that.

3 hours ago, Benjamin McGuire said:

I am also happy with this outcome. I enjoyed Bress's opinion a great deal. I found the discussion about the problem of allowing the plaintiff the right to define the language of the defendant - especially in the religious context where the defendant by definition is recognized as having the right of definition was really well done. The further recognition here that to allow this to happen would create infringing government intrusion was an important point (apart from the first amendment concerns). And so while I think that it's good that the main opinion was ruled entirely within the basis of the fraud claims, I appreciated the clarity that the second opinion offered on the question of the Constitutional protections given to the Church:

Same here.  I think we can anticipate Judge Shelby addressing the entirety of the Huntsman decision in his forthcoming decision in the MDL lawsuit.  I think he will likely follow the Ninth Circuit's lead and not apply CAD.  Alternatively, he may split the difference and say that CAD does not apply, but if it did, it would lead to the same result (that the MDL plaintiffs lose).

In my view, the decision in Huntsman leaves the MDL lawsuit a "dead man walking."  It's just a matter of time.  Once that happens, and with the passage of time since the City Creek stuff, I think the Church will likely face very few further "copycat" lawsuits.

Huntsman and the MDL lawsuit will not, therefore, be a clear "First Amendment victory" for the Church, and that's okay.  The Church has better ways to spend its time, money and efforts.

Thanks,

-Smac

Edited January 31, 2025 by smac97

[bluebell]

28 minutes ago, smac97 said:

A few thoughts from a quick read of the decision:

1. The decision is 63 pages long in PDF form.  The substantive legal analysis begins on page 13 of the PDF.  

2. The key bit about the fraud analysis:

Yep.  Pretty plain-jane application of the law here.  I can't imagine Huntsman wanting to pay his lawyers more money to try to get SCOTUS to consider this case.  It's too mundane.  It doesn't plow any new ground, and the only new ground that could have been plowed would have been the Church Autonomy Doctrine, which the primary opinion did not use.  

Conversely, an adverse ruling against the Church would have given it plenty of incentive to seek SCOTUS review.

3. The Ninth Circuit also goes into the tithing-as-principal-and-also-earnings argument:

"{N}o reasonable juror could conclude that the Church made a 'knowingly false representation of fact' to Huntsman about the source of funds for the City Creek project."

Yep.

4. The substantive analysis is quite brief, going from pp. 13-18 of the decision.  This is the "primary opinion" of the Ninth Circuit, and the one that creates precedent.  It was a unanimous decision, so there was no "minority" opinion.  Judge Friedland wrote it, and five others (Judges Murguia, Owens, Sung, Sanchez and De Alba) joined in it.

The rest of the decision (pp. 19-63) is taken up with two concurring opinions, one authored by Judge Bress (and joined - mostly - by Judges Smith, Nguyen and Vandyke) and the other by Judge Bumatay (writing singly).  (In a federal appellate context, a concurring opinion is a separate written opinion by one or more judges who agree with the majority's decision but for different reasons or with additional legal reasoning.)

5. In the Bress Concurrence, the four judges delve into the Church Autonomy Doctrine ("CAD") :

IIRC, I think I predicted that Huntsman would come to regret his published-to-the-world philosophical criticisms of the Church in connection with his lawsuit, as those criticisms made his position look much more like an internecine dispute than a secular one about fraud claims.

6. The Bress Concurrence goes on to disagree with the primary opinion's take on CAD (emphases added) :

Wow.

7. The Bress Concurrence goes on at some length to explain the purposes of CAD, saying that Huntsman's lawsuit, had it continued, "would violate core First Amendment principles.  It would do so in two main ways."  The first ostensible violation of the First Amendment addresses a point I have been noting for some years now, namely, the intrinsic dispute about the definition of "tithing."  It is some really good legal writing, so I will quote it in its near entirety, and bold the parts I find most illuminating:

Great stuff.

8. The above footnote also bears some attention (also bolded by me) :

I am glad the Church acknowledged that CAD is not a universal bar to civil claims.

9. The Bress Concurrence goes on to describe a second ostensible violation of the First Amendment if Huntsman's lawsuit were to proceed (bolded emphases added) :

Good stuff, all.

10. The Bumatay Concurrence is a bit more brief.  From the summary:

11. The Church has been wholly vindicated in the Huntsman lawsuit.  The only disagreement in the Ninth Circuit was whether the CAD applies, and even that was a very close call.  As it is, the Ninth Circuit entirely vindicated Pres. Hinckley and the Church on the merits and the facts.  Again: "As the majority therefore correctly concludes, 'Huntsman has not presented evidence that the Church did anything other than what it said it would do.' Every judge on this en banc court to reach the question concludes the same, as did the district court."

12. For my part, I think the concurring judges have the better argument about CAD's applicability.  However, the primary opinion's non-application of CAD both

• A) vindicates Pres. Hinckley's honesty (which some, including people on this very board, had impugned) because the decision was based on the facts of the case, and not based on cutting off judicial inquiry by applying CAD;
• B) likely guts any incentive for Huntsman to appeal (which, I think, would have been more likely had the primary opinion applied CAD, which might have resulted in the Ninth Circuit plowing new ground relative to CAD, which might have, in turn, made SCOTUS more likely to hear an appeal, and which may have incentivized Huntsman to seek such further SCOTUS review); and
• C) likely creates a pretty potent "persuasive authority" for Judge Shelby to apply in the case currently pending before him in Utah. 

13. As to item 12(C) above, from ChatGPT:

The Ninth Circuit's decision in Huntsman is not binding on Judge Shelby because Utah is in the Tenth Circuit.  Nevertheless, I would bet real money on Judge Shelby ending up quoting and relying on Huntsman in dismissing the MDL lawsuit.

14. I am very happy, but not really surprised, at this outcome.

Thanks,

-Smac

I'm impressed with how respectful the legal analyses are of the church.

[smac97]

29 minutes ago, bluebell said:

I'm impressed with how respectful the legal analyses are of the church.

Yes, the judicial opinions tend to be considerably more measured and impartial than the written briefs submitted by the litigants.  Huntsman's filings were pretty acerbic and harsh (they were alleging fraud, after all).  The Ninth Circuit's brief is notable for its brevity, clarity and concision.

The Deseret News has posted this: Unanimous 9th Circuit panel dismisses Huntsman tithing lawsuit

Quote

A panel of 11 judges in the 9th Circuit issued a unanimous ruling Friday dismissing James Huntsman’s lawsuit seeking the return of $5 million he donated to The Church of Jesus Christ of Latter-day Saints.

It is the second time the lawsuit has been dismissed in four years.
...
The 9th Circuit panel, known as an en banc panel, stated in its ruling Friday that the district court held “that no reasonable juror could find that the church had misrepresented how it used tithing funds. We agree and therefore affirm.”
...
Huntsman appealed, and a 9th Circuit panel reinstated the lawsuit by a 2-1 vote in August 2023.

 

The church asked for and was granted an en banc appeal of that reinstatement. The en banc panel of 11 judges of the 9th Circuit heard oral arguments in September 2024, when the judges peppered Huntsman’s attorneys with questions.

The panel said it would issue a written ruling in coming months.

That ruling came Friday, and the judges rejected Huntsman’s claims outright on the merits, finding that the church committed no fraud or misrepresentations.

"That ruling came Friday, and the judges rejected Huntsman’s claims outright on the merits, finding that the church committed no fraud or misrepresentations."

Yep.

I always figured this case to be a loser, and a money grab by his attorneys.  Now that the factual dispute has been resolved (as I don't anticipate an request for SCOTUS review will even be attempted, let alone granted), I hope Mr. Huntsman can have some time for introspection.  Litigation can create hard feelings and acrimony.  Once it's over, though, it is generally better for the parties to either totally go their separate ways, or else look for some form of reconciliation, or at least détente-style capacity to get along.  I hope Mr. Huntsman can, in time, come back to us.

Thanks,

-Smac

[let’s roll]

3 hours ago, smac97 said:

The Church has been wholly vindicated in the Huntsman lawsuit.  The only disagreement in the Ninth Circuit was whether the CAD applies, and even that was a very close call. 

Thanks SMAC for your summary of the opinion.  Is there language in the majority opinion that any of the judges thought the CAD was not applicable, rather than not needed to resolve the case?

As you know, it is not unusual for judges to decide a case on a single dispositive issue (here, the lack of any facts that would support a finding of fraud) and choose not to address any other legal or factual issues, believing that doing so is both a waste of judicial resources and an unnecessary application of the facts to existing case law which some may deem a gratuitous expansion or contraction of a doctrine such as the CAD.

In other words, are those who didn’t join the concurring opinion just being minimalistic, or is there some indication in the majority opinion that the some would have balked at dismissing the case using the CAD?

[JustAnAustralian]

5 hours ago, smac97 said:

.  I wonder if Judge Shelby will reach the same conclusion.

At the very least he now has things to point to in making his conclusion and writing his ruling/judgment/opinion.

It will be hard for people to give genuine pushback when Huntsman got thoroughly smacked down twice in very non-Utah courts.

[Calm]

https://www.courtlistener.com/opinion/10324777/james-huntsman-v-corporation-of-the-president/

[smac97]

20 hours ago, JustAnAustralian said:

Quote

I wonder if Judge Shelby will reach the same conclusion.

At the very least he now has things to point to in making his conclusion and writing his ruling/judgment/opinion.

Yes.  Same goes for the 10th Circuit's evaluation of the Gaddy appeal (which is, by far, the worst of the lot).

20 hours ago, JustAnAustralian said:

It will be hard for people to give genuine pushback when Huntsman got thoroughly smacked down twice in very non-Utah courts.

Huntsman did indeed get dressed down (as did his attorneys) in the Bress Concurrence:

Quote

This lawsuit is extraordinary and patently inappropriate, a not-so thinly concealed effort to challenge the Church’s belief system under the guise of litigation. 

Yeesh.

Moreover, Pres. Hinckley's and the Church's accuracy and integrity re: statements about City Creek were thoroughly vindicated by the entire Ninth Circuit:

Quote

Moreover, even accepting Nielsen’s account that Ensign Peak employees used “tithing” to refer interchangeably to both principal and earnings, that does not support Huntsman’s claim because President Hinckley drew a distinction between those types of funds in his public statements.
...
It was necessary to reinvest in these properties, President Hinckley told Church members at a religious gathering, because “[w]e feel we have a compelling responsibility to protect the environment of the Salt Lake Temple.”  Geared toward “revitaliz[ing] this area” around the Church’s sacred Temple, the Church explains that the expenditure of Church funds for the City Creek project was consistent with the Church’s religious mission.  There is no suggestion that the project involved self-dealing on the part of Church leaders. 
...
(From the Bress Concurrence) 

It is possible to resolve this case as the majority does, by taking Huntsman’s allegations at face value and finding that on their surface, President Hinckley did not say that earnings on tithed funds would not be used for the City Creek project.  President Hinckley, in other words, did not say what Huntsman says he said.  As the majority therefore correctly concludes, “Huntsman has not presented evidence that the Church did anything other than what it said it would do.”  Every judge on this en banc court to reach the question concludes the same, as did the district court.   

Ironically, Huntsman admittedly venue-shopped his lawsuit to California because he was hoping to get judges that would be more averse to the Church.  As it is, he managed to not only persuade the most liberal circuit in the country that the Church was honest, but that he was not ("President Hinckley, in other words, did not say what Huntsman says he said" and "{Huntsman's} lawsuit is extraordinary and patently inappropriate, a not-so thinly concealed effort to challenge the Church’s belief system under the guise of litigation").

The phrase "self-owned" comes to mind.

Thanks,

-Smac

Edited February 1, 2025 by smac97

[JustAnAustralian]

I did like the way they hit two key points that were brought up in the discussions on this board:

• Principal vs interest - not the same thing
• Intermingling - even if they were intermingled it doesn't matter because there was enough interest to cover it

 

[Kenngo1969]

On 12/24/2024 at 12:46 PM, smac97 said:

... Giid questions. 

Also, they are Good questions.  

Sorry.   Couldn't resist!     

[Analytics]

On 8/22/2023 at 1:51 PM, Analytics said:

Quote

Sam Brunson weighs in on the 9th Circuit reversal:

Was the Court of Appeals right? Frankly, I’m not convinced. It basically turns on whether a reasonable person would believe that “tithing” included not just the church’s tithing revenue, but income earned on that tithing revenue.[fn1] And honestly, that’s a pretty absurd assertion; every financial endeavor that includes both principal and income on the principal distinguishes the two. 

Sam Brunson is wrong on this point. As an example, on November 30, 2016, a House subcommittee had a hearing about the Federal Long Term Care Insurance Program. In that hearing, Glenn Grothom (R-Wisconsin) asked the following:

...I don't care whether it's 
health insurance, car insurance, whatever, you always kind of 
wonder how much of that premium is going for claims and how 
much is going for overhead and commissions and that sort of 
thing.
    Could you give me, the insurance industry in general, how 
much of, say, auto insurance, health insurance, and long-term 
insurance, how much goes for claims?

Marc Cohen answered the question as follows:

At least historically when these products have 
been priced, the idea was that somewhere between 60 to 70 
percent of the dollars that were collected would eventually get 
paid out in claims.

See:https://www.congress.gov/event/114th-congress/house-event/LC52104/text?s=1&r=63

I'm not 100% positive what Congressman Grothom meant by his question, but I am positive that Professor Cohen interpreted the question as including both principle and interest. When a long-term care insurance policy is sold, most of the premiums in the early years of the policy are invested, and the insurance company then relies on both principle and interest to eventually pay the claims. When Professor Cohen said 60-70% of premiums goes to claims, he meant 60-70% of premiums, accumulated with interest, go to paying claims. 

Just as Marc Cohen interpreted "how much of that premium is going for claims" as including interest, it is eminently reasonable to infer that when the Church said "no tithing money was used" it meant that no tithing money, accumulated with interest, was used.

Given the fungible nature of money, this should be obvious. Unless the Church has an account with only pure unadulterated "tithing money" and another account with the sullied investment income, how would it know whether a dollar it spent was actual tithing or whether it was the investment income?

Last week, I found myself the center of attention in a zoom call that lasted over 8 hours. On the call were four attorneys representing a large insurance company, four formidable attorneys from the plaintiffs' bar, a videographer, a court reporter, and me. I was being deposed as an expert witness in a billion-dollar class action lawsuit. 

One of the questions I was asked was, “What is a loss ratio?"

I don’t have the transcript back yet, but I remember the basics of my answer. I said something to the effect of:

“A loss ratio is a profitability metric used by insurance companies. It represents the present value of claims divided by the present value of premiums. The premiums and claims can be actuarial estimates for a policy or block of policies at the time of issue, or actual premiums and claims after a block of policies have run out, or an intermediate value that combines past actual values with updated forecasts. For example, if a company says the loss ratio is 70% for a particular block, it means that 70% of premiums are used to fund claims, with the remaining 30% of premiums being used for commissions, administrative expenses, risk margin, and profit. Of course when we say 70% of premiums are used to fund claims we mean 70% of premiums, accumulated with interest, are used to fund claims. In actuarial mathematics, we always apply accumulation or discount functions to cash flows such as premiums and claims, and never do so in a way that distinguishes between principal and interest; if somebody says 70% of premiums were used to fund claims, everyone would assume that meant 70% of premiums, accumulated with interest, were used to fund claims."

I got the distinct sense that the attorney who was deposing me was irritated by the way I over-emphasized that in these calculations, principal and interest are intermingled. In my world the point is obvious.