Statutory Changes Allow Suit for Sex Abuse Against Jehovah's Witnesses Congregations

In C.P. v. Governing Body of Jehovah's Witnesses, (NJ App., Nov. 15, 2023), a New Jersey appellate court affirmed a trial court's denial of summary judgement to Jehovah's Witnesses congregations and governing bodies. Plaintiff C.P. was sexually abused by Charles, her grandfather.  During the years the abuse was occurring, Charles also served as an elder at two Jehovah's Witnesses congregations.  In a 1994 lawsuit, plaintiff was awarded over $2.2 million in damages from her grandfather. Subsequently New Jersey's Charitable Immunity Act and statute of limitations were amended so that plaintiff could now sue the congregations involved, and this suit followed.  The court explained:

According to plaintiff, defendants knew Charles had engaged in sexual conduct with at least three minors—including herself—but did not discipline him and negligently retained him as an elder—a spiritual leader and mentor. Plaintiff claims defendants knew incidents of sexual abuse by their agents was prevalent within their organizations but nevertheless protected Charles and other sexual abusers from criminal prosecution through "mandated secrecy" policies and practices. Plaintiff also alleges defendants owed a "special duty" to protect her from her grandfather's sexual criminal acts because they held themselves out as "being able to provide a safe environment" for children. Ultimately, plaintiff contends Charles was disfellowshipped—excommunicated as a result of reports about and his admission to sexual misconduct, and therefore, defendants engaged in willful, wanton, or grossly negligent conduct.

Defendants claimed that the "entire controversy doctrine" and judicial estoppel bar the present suit. The court disagreed, saying in part:

As the trial court found, the two litigations involve separate claims. The 1994 action sought damages for harm directly inflicted by Charles; the 2021 action seeks damages from defendants for claims of negligent hiring and retention, alleging defendants knew and allowed Charles—a known child abuser—to serve as an elder in their church, exposing children to sexual molestation.

LDS Church Sued Over Use of Tithed Funds

A class-action lawsuit was filed last week in a Utah federal district court against the Latter-Day Saints Church alleging fraud, unjust enrichment and breach of fiduciary duty in the handling of tithed funds and other contributions by the Church. The complaint (full text) in Chappell v. Corporation of the President of the Church of Jesis Christ of Latter-Day Saints, (D UT, filed 10/31/2023) alleges in part:

1. For decades, COP has used false pretenses to obtain donations. Rather than use these funds entrusted to it for charitable work, COP secreted donations away in Ensign in order to avoid public scrutiny and accountability to the donors, and instead used them for purposes never contemplated by donors and contrary to representations by COP....

3. For instance, COP maintains various philanthropies, including “Humanitarian Relief,” which provides “immediate emergency assistance to victims” of disasters. On its website, COP solicits donations to the Humanitarian Relief fund by stating that “One hundred percent of every dollar donated is used to help those in need without regard to race, religion, or ethnic origin.”

4. Despite these representations to donors, Plaintiffs understand based on public reports from third parties that COP deliberately hid that some, if not all, of these donations (including both tithes and donations made to a COP philanthropy) are permanently invested in accounts it never uses for any charitable work, so that every year, an enormous portion of the donations are never spent for these —or any— purposes.

Salt Lake Tribune reports on the lawsuit.

Alabama Law Protects Identity of Donors, Supporters, Volunteers and Members of Non-Profits

Yesterday, Alabama Governor Kay Ivey signed S-59, The Personal Privacy Protection Act (full text). The new law prohibits any governmental agency from requiring disclosure of, or from releasing information about, the identity any member. supporter, volunteer, or donor of a non-profit organization.  It also bars requiring any current or prospective contractor or grantee to disclose non-profits to which it has donated or provided support. The Act contains a number of exceptions, including required disclosures under campaign finance laws.  Indiana has recently enacted a similar statute. (See prior posting.) ADF issued a press release announcing the signing of the law.

Indiana Governor Signs Bill Protecting Privacy of Donors and Members of Nonprofits

On May 4, Indiana Governor Eric Holcomb signed House Bill 1212 (full text) which protects the privacy of information about the identity of members, supporters, volunteers and donors to nonprofit organizations. Among other things, under the new law governmental agencies and governmental subdivisions may not require nonprofits to furnish lists of donors, members, volunteers or supporters, may not release information of that sort that is in their possession, nor require a prospective contractor or grantee to disclose nonprofits to which it has donated.  The new law has a number of exceptions, including disclosures required by campaign finance and lobbying disclosure laws. ADF issued a press release announcing the signing of the bill.

11th Circuit: Exclusion of Anti-LGBT Group From Charitable Donation Program Is Upheld

In Coral Ridge Ministries Media, Inc. v. Amazon.com, Inc., (11th Cir., July 28, 2021), the U.S. 11th Circuit Court of Appeals affirmed an Alabama federal district court's dismissal of a defamation and religious discrimination suit brought by a Christian ministry and media company.  At issue is Amazon's customer-choice charitable donation program which excludes as possible beneficiaries organizations that are designated as hate groups by the Southern Poverty Law Center. Coral Ridge was listed as a hate group because of its religious beliefs opposing LGBTQ conduct. The court dismissed the defamation claim because plaintiff failed to adequately plead actual malice (i.e., knowledge of falsity or reckless disregard of the truth). The court dismissed Coral Ridge's claim of religious discrimination in violation of the public accommodation provisions of the 1964 Civil Rights Act, saying in part:

[T]he district court was correct in finding that Coral Ridge’s interpretation of Title II would violate the First Amendment by essentially forcing Amazon to donate to organizations it does not support.... 

Coral Ridge’s proposed interpretation of Title II would infringe on Amazon’s First Amendment right to engage in expressive conduct and would not further Title II’s purpose....

Courthouse News Service reports on the decision.

Supreme Court Strikes Down California Donor Disclosure Rules

The U.S. Supreme Court today in Americans for Prosperity Foundation v. Bonta, (Sup. Ct., July 1,2021), held unconstitutional California's requirement that charitable organizations soliciting funds in the state disclose their major donors to the state Attorney General. In a 6-3 opinion written by Chief Justice Roberts, the Court said in part:

We are left to conclude that the Attorney General’s disclosure requirement imposes a widespread burden on donors’ associational rights. And this burden cannot be justified on the ground that the regime is narrowly tailored to investigating charitable wrongdoing, or that the State’s interest in administrative convenience is sufficiently important. We therefore hold that the up-front collection of Schedule Bs is facially unconstitutional, because it fails exacting scrutiny in “a substantial number of its applications . . . judged in relation to [its] plainly legitimate sweep.

Justice Thomas filed a concurring opinion. Justice Alito, joined by Justice Gorsuch, filed a concurring opinion. Justice Sotomayor, joined by Justices Breyer and Kagan, dissented, saying in part:

Today, the Court holds that reporting and disclosure requirements must be narrowly tailored even if a plaintiff demonstrates no burden at all. The same scrutiny the Court applied when NAACP members in the Jim Crow South did not want to disclose their membership for fear of reprisals and violence now applies equally in the case of donors only too happy to publicize their names across the websites and walls of the organizations they support. 

SCOTUSblog reports on the decision in greater detail.

Supreme Court Hears Oral Arguments Today In Challenge To California's Required Disclosure of Donors To Non-Profits

The U.S. Supreme Court this morning will hear consolidated oral arguments in Thomas More Law Center v. Rodriquez (SCOTUSblog case page) and Americans for Prosperity Foundation v. Rodriquez (SCOTUSblog case page). At issue is a California administrative rule requiring non-profit organizations that wish to solicit tax deductible contributions in the state to file an annual report that includes an unredacted IRS Form 990 Schedule B. That Schedule contains the names and contributions of significant donors. Petitioners argue that disclosure subjects donors to dangers of hate mail and retaliation.  Thomas More Law Center describes its mission, in part, as preserving America’s Judeo-Christian heritage and defending the religious freedom of Christians. This post will be updated with a link to the transcript of the oral arguments when it becomes available later today.

Here are links to the audio and transcript of the full arguments.

Supreme Court Wil Hear Challenge To California Donor-Disclosure Requirement

The U.S. Supreme Court on Friday granted certiorari in Thomas More Law Center v. Becerra (Docket No. 19-255, cert. granted 1/8/2021) and Americans for Prosperity Foundation v. Becerra (Docket No. 19-251, cert. grange 1/8/2021) (Order List), and consolidated the cases for oral argument.  At issue is a California administrative rule requiring non-profit organizations that wish to solicit tax deductible contributions in the state to file an annual report that includes an unredacted IRS Form 990 Schedule B. That Schedule contains the names and contributions of significant donors. Thomas More Law Center, which describes itself in its petition for certiorari as a non-profit organization that defends religious freedom, family values, and the sanctity of life, argues in its cert. petition:

For those associated with charities that speak on contentious matters—like Petitioner the Thomas More Law Center (the “Law Center”)—disclosing donor information to the Attorney General’s Registry poses an imminent danger of hate mail, violence, ostracization, and boycotts. Only the most stalwart supporters will give money under such a toxic cloud. Most will reasonably conclude that the risk of association is too great, with the result that groups who make the most threats will effectively shut down those with whom they disagree.

See prior related posting. SCOTUSblog case pages (1, 2) for the cases have links to all the pleadings and related materials.

Church of Atheism Not A Charity Under Canadian Tax Law

In Church of Atheism of Central Canada v. Minister of National Revenue, (Canada Fed. Ct. App., Nov. 29, 2019), Canada's Federal Court of Appeal held that the Church of Atheism of Central Canada is not entitled to registration as a charity under Canada's Income Tax Act.

Because the Act does not define “charitable activities”, we must turn to the common law to answer this question. At common law, there are four recognized charitable purposes, the two relevant to this appeal being “the advancement of religion” and “certain other purposes beneficial to the community” ....

Turning therefore to section 2(a) of the Charter, the appellant is correct to point out that the courts have found that this section does protect the rights of atheists.... However, I find in this case that the Minister’s refusal to register the appellant as a charitable organization does not interfere in a manner that is more than trivial or insubstantial with the appellant’s members ability to practise their atheistic beliefs. The appellant can continue to carry out its purpose and its activities without charitable registration....

Law & Religion UK reports at greater length on the decision.

Texans Sue Under the "Save Chick-fil-A" Law

As previously reported, in June Texas Gov. Greg Abbott signed a bill which prohibits any governmental entity in Texas from taking adverse action against any person because of the person's affiliation, contribution or support for a religious organization. The law was aimed at San Antonio's exclusion of Chick-fil-A from operating at the San Antonio's airport.  The restaurant chain has been criticized for its contributions to organizations that oppose same-sex marriage. Last week, five Texas residents filed suit in a state trial court under the new law seeking an injunction to prevent the city from continuing to exclude Chick-fil-A from the airport. The complaint (full text) in Von Dohlen v. City of San Antonio, (TX Dist. Ct., filed 9/5/2019), alleges in part:

The law of Texas prohibits governmental entities from taking “adverse action” against corporations based on their contributions to a religious organization. See Texas Gov’t Code § 2400.002. The City of San Antonio is violating this statutory command by excluding Chick-fil-A from the San Antonio airport on account of its donations to Christian organizations such as the Salvation Army and the Fellowship of Christian Athletes. 

20. For years, liberal activists have been attacking Chick-fil-A because it gives money to Christian organizations that accept the Bible as the Word of God.

21. Because these Bible-believing Christian organizations derive their notions of morality from the Bible rather than modern-day cultural fads, they oppose homosexual behavior and same-sex marriage.

San Antonio Family Association issued a press release announcing the filing of the lawsuit.

New Tax Law Tweaks Non-Profit Annual Filing Requirements

President Trump yesterday signed the bipartisan Taxpayer First Act (full text) into law. The bill makes two changes applicable to non-profit organizations. Section 3101 provides that those organizations required to file annual returns must file them electronically. Section 3102 requires the IRS to give notice to a non-profit before revoking its tax exempt status for failure to file annual returns.  It should be noted that under IRC Sec. 6033(a)(3), churches and small religious organizations are exempt from annual return filing requirements. The Hill reports on the President's signing of the bill into law.

Texas Governor Signs "Save Chik-fil-A" Law

On Monday, Texas Gov. Greg Abbott signed into law S.B. 1978 (full text) which prohibits any governmental entity in Texas from taking adverse action against any person because of the person's affiliation, contribution or support for a religious organization. According to KXAN News:

The bill was brought forward by Republicans after San Antonio City Council voted in March to exclude Chik-fil-A from having airport concessions in their city because of the fast-food chain's owners' record on LGBT issues, specifically over donations to the Fellowship of Christian Athletes, the Salvation Army, and a George youth home; whose leaders advocate for marriage to be between one-man and one-woman.

The law has become known as the "Save Chik-fil-A bill."

Washington Catholic Hospitals Settle Suit Charging Them With Failure To Provide Charity Care

Washington state's attorney general yesterday announced the filing of a consent decree (full text) in State of Washington v. Franciscan Health System, (WA Super. Ct., April 29, 2019).  The settlement grows out of a lawsuit filed in 2017 against eight CHI Franciscan hospitals alleging that they violated the state's Consumer Protection Act by failing to make charity care available to tens of thousands of patients who were entitled to it under state law. As summarized by the AG's press release, the hospitals "will forgive as much as $20 million in debt, pay $2.22 million in refunds, pay the Attorney General’s Office $2.46 million, and rehabilitate the credit of thousands of patients who qualified for charity care between 2012 and 2017 but did not receive it."  The Consent Decree also requires detailed changes in the hospitals' procedures for providing financial assistance to patients.

Canadian Court Invalidates Limits On Charities' Lobbying Expenditures

CBC reports on a July 16 decision by the Ontario Superior Court of Justice which invalidated provisions of Canada's Income Tax Act which limit expenditures for political lobbying activities by charities to 10% of its resources. (Background.)  According to CBC:

The decision by Justice Edward Morgan of the Ontario Superior Court of Justice is a reprieve for the tiny Ottawa group that launched the challenge — Canada Without Poverty — which has been under formal notice of losing its charitable status since 2016....

Morgan's decision does not alter the prohibition against charities engaging in partisan activities — that is, supporting particular candidates or political parties. Charities have not challenged that section of the Act....

But he did rule the 10 per cent rule was an arbitrary and unjustified infringement of freedom of expression as guaranteed in Section 2 of the Charter of Rights and Freedoms. And he said Canada Without Poverty needs to engage in political activity, such as buttonholing ministers and encouraging Canadians to contact their MPs, to carry out its charitable purpose.