A federal appeals court Tuesday threw out a class-action lawsuit against the Church of Jesus Christ of Latter-day Saints, ruling the suit violated church autonomy.
The lawsuit was brought by three former members of the church, who accused it of intentionally misrepresenting its religious history and fraudulently using tithes.
However, a three-judge panel of the 10th U.S. Circuit Court of Appeals dismissed the claims, saying, “We must decline the plaintiffs’ invitation to ‘enter [the] forbidden domain’ of assessing the ‘truth or falsity’ of religious beliefs and doctrine.”
The case dates to 2019, when Laura Gaddy, a former member of the church, filed a class action arguing the church had intentionally misrepresented its history to induce membership. The district court rejected her argument, so in 2020, she filed an amended complaint, arguing that the church had both committed common law fraud and given false information about its use of tithes. The district court rejected part of that complaint but allowed part to stand.
Instead of continuing with that suit, though, in 2021, Gaddy, along with former members Lyle Small and Leanne Harris, filed a suit arguing that the church, through its corporation, violated the Racketeer Influenced and Corrupt Organizations Act, or RICO, by (1) making false claims about its history that even its leaders didn’t believe and (2) fraudulently using tithes.
The federal district court dismissed the case, but Gaddy appealed.
Several religious organizations, including the Becket Fund for Religious Liberty, filed “friend of the court” briefs on behalf of the church, arguing that allowing the lawsuit to continue “would undermine … the right of religious institutions ‘to decide for themselves, free from state interference, matters of church government as well as those of faith and doctrine.’”
On Tuesday, the 10th Circuit ruled in favor of the church, holding that for the court to decide whether church leaders had falsely represented their beliefs would “improperly require … adjudication of ecclesiastical questions.”
Judge Allison H. Eid, who wrote the opinion for the panel, cited the district court’s ruling that a court “can no more determine whether Joseph Smith … translated with God’s help gold plates … than it can opine on whether Jesus Christ walked on water or Muhammed communed with the archangel Gabriel.”
The 10th Circuit also rejected the fraudulent tithe argument, saying Gaddy and the others had failed to “plausibly plead” that the alleged misstatements “caused the harm” they allegedly suffered.
That makes it the third tithing case against the LDS to be thrown out in the past year, with the Ninth Circuit rejecting an appeal in January and a district court rejecting one in April.
Kay Burningham, who represented Gaddy, Small, and Harris, said, “We are disappointed that the Tenth Circuit Court of Appeals has interpreted the ‘church autonomy doctrine’ as an affirmative defense to fraud.”
Burningham says she will decide whether to petition the Supreme Court for certiorari in the next 90 days.
