551 F.Supp.3d 1206
D. Utah2021Background
- Plaintiff Laura Gaddy, a longtime former member of the Church of Jesus Christ of Latter-day Saints, alleges the Church intentionally misrepresented core aspects of its founding, history, and doctrine (First Vision, Book of Mormon, Book of Abraham), plus polygamy history and geographic claims, to induce membership.
- Gaddy sued on behalf of a putative class asserting common-law fraud, fraudulent inducement, fraudulent concealment, civil RICO, intentional infliction of emotional distress, and breach-related claims; the original complaint was dismissed under the First Amendment church-autonomy doctrine.
- Gaddy filed an Amended Complaint adding factual allegations (polygamy, Hill Cumorah location, alleged misuse of tithing for City Creek Mall), a theory that Church leaders insincerely hold their teachings, a Utah Charitable Solicitations Act claim, and an alternate RICO theory based on alleged false statements about tithing use.
- The Church moved to dismiss again, arguing the Religion Clauses bar adjudication because resolution would require determining the truth or falsity of religious beliefs or teachings.
- The court dismissed most claims as barred by the First Amendment (fraud claims, omission-based claims, Utah Charitable Solicitations Act claim, RICO theories rooted in religious doctrine, and emotional distress claim) but denied dismissal of one RICO theory alleging secular misrepresentations about the Church’s use of tithing funds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether fraud claims that challenge religious doctrines are barred by the First Amendment | Gaddy: she challenges factual bases and omissions about the Church’s history and doctrines (not beliefs) and alleges inducement to join | Church: adjudication would require impermissible inquiry into truth/falsity of religious beliefs; church-autonomy doctrine bars suit | Held: barred — fraud claims implicating core doctrine dismissed under church-autonomy/First Amendment |
| Whether a court must inquire into sincerity of the Church’s beliefs before applying church-autonomy | Gaddy: sincerity is a factual issue that precludes dismissal at Rule 12 stage | Church: no threshold sincerity inquiry; truth/falsity element and ecclesiastical nature control | Held: rejected — no preliminary sincerity inquiry; even alleged insincerity would not avoid required truth inquiry for fraud |
| Whether omission-based fraud claims and Utah Charitable Solicitations Act claims survive because they do not require proving falsity | Gaddy: omissions can be actionable without deciding doctrinal truth; a jury need only assess what a reasonable person would want to know | Church: omissions require assessing whether statements about doctrine are misleading, which still entails doctrinal truth inquiries | Held: dismissed — omission theories still require impermissible examination of religious doctrine; Charitable Solicitations Act claim fails for same reason |
| Whether a RICO claim premised on alleged false statements about tithing use survives | Gaddy: Church falsely assured tithing would not be used for commercial purposes (e.g., City Creek Mall) — secular misrepresentation supporting mail/wire fraud predicates | Church: tithing is religiously rooted; adjudication would entangle court in doctrine and internal church use | Held: allowed in part — RICO theory alleging secular misrepresentations about actual use of tithing funds survives; other RICO theories tied to doctrinal truth dismissed |
Key Cases Cited
- Emp. Div., Dep’t of Hum. Res. of Or. v. Smith, 494 U.S. 872 (1990) (Free Exercise protects belief and religious profession)
- United States v. Ballard, 322 U.S. 78 (1944) (courts may not adjudicate truth or falsity of religious beliefs)
- Bryce v. Episcopal Church in the Diocese of Colorado, 289 F.3d 648 (10th Cir. 2002) (articulates church-autonomy doctrine and secular vs. ecclesiastical inquiry)
- Kedroff v. St. Nicholas Cathedral, 344 U.S. 94 (1952) (historic recognition of church autonomy in internal governance)
- United States v. Rasheed, 663 F.2d 843 (9th Cir. 1981) (criminal mail-fraud case discussing inquiry into sincerity of religious belief for mens rea)
- Van Schaick v. Church of Scientology of Cal., Inc., 535 F. Supp. 1125 (D. Mass. 1982) (distinguishes secular factual claims by religious orgs that may be actionable)
- In re The Bible Speaks, 869 F.2d 628 (7th Cir. 1989) (Free Exercise does not shield purely secular statements of fact by religious organizations)
- Thomas v. Review Bd. of Ind. Emp. Sec. Div., 450 U.S. 707 (1981) (courts are not proper arbiters of scriptural interpretation)