We are joined today by attorney Kolby Reddish to discuss the recent updates in the James Huntsman case against the Church of Jesus Christ of Latter-day Saints. Huntsman claimed the Church misused funds, alleging fraud and is seeking the return of millions of dollars of his voluntary contributions. This case could have national implications on how religious organizations use the voluntary contributions they receive from their members, and could impact how educational institutions and non-profits solicit voluntary contributions and invest some of those contributions for future use. Join us today as we discuss this groundbreaking case!
For the full oral argument visit here: https://www.youtube.com/watch?v=ds0mK4pJ9YQ
Episode Transcript
Host: John Dehlin · Co-host: Kolby Reddish
This transcript is machine-generated and lightly edited for readability. The audio is authoritative. Please excuse occasional errors in names and spelling.
Introduction to the Huntsman Tithing Lawsuit
John Dehlin [00:00:01] Hello, everyone, and welcome to another edition of Mormon Stories podcast. I'm your host, John Dehlin. It is Wednesday, September 25, 2024, and today we are covering the Huntsman tithing lawsuit. Today I won't get the legal jargon right, but today James Huntsman and his legal crew will be appearing, I believe in a San Francisco courtroom.
John Dehlin [00:00:29] I believe it is courtroom one in the James R. Browning U. S. Courthouse in the United States Court of Appeals for the Ninth Circuit, where James Huntsman will be arguing the merits of his case suing the Mormon Church for fraud. Now this is, this is a crazy week in Mormon Stories history because there was another hearing on Monday that we covered where in Denver there was a hearing reviewing the credibility of the Gaddy case where the Mormon Church is being sued for history fraud. And today we're going to be again talking about the Huntsman case, which is a totally different type of fraud because I don't know my backside from a legal book.
John Dehlin [00:01:26] We have with us today Kolby Reddish, our resident legal expert, to help us understand what's going on. And basically we're going to be. Kolby's going to share with us some context. And then at 3:30 mountain time today, we're going to just tune in to the hearing. We're going to listen to it live and then we're going to react to it afterwards. And of course we're live streaming, so we've got Maven and Julia behind the scenes. They're going to star the best comments and the best questions. And then we're going to do our best to allow you to share your thoughts and feelings and to ask questions of Kolby.
John Dehlin [00:02:14] And of course, we thank our monthly donors to Mormon Stories, the Open Stories foundation that make all this possible. Please go to MormonStories.org click on the Donate button. Become a monthly donor if you value this content and want to see it continue. But please, if you're already a donor, know that we couldn't do this without you. We also always welcome Super Chats, which are donations through this live chat on YouTube.
John Dehlin [00:02:39] If, if you want to make sure your question or comment are seen and shared, we invite you to do it through Super Chat. And of course, the money in the Super Chat will go to paying our staff and our operational expenses. Finally, we always appreciate it when you subscribe to our YouTube channel and like it. And also know that tomorrow, September 26th, we're going to be running a live stream, sort of a global vigil in support of Nemo the Mormon, who is set to be excommunicated tomorrow. So please plan on tuning in tomorrow and showing your support. I've reached out to a lot of excommunicated Mormons to appear on the show, and we'd love any of you who want to show your support to Nemo to, to be there as well.
Kolby Reddish [00:03:30] Perfect.
John Dehlin [00:03:31] Okay.
Kolby Reddish [00:03:31] Well, I, I will just give people a quick roadmap of what we're going to cover today. In addition to the introductory comments that John's already made, we are going to cover the oral arguments live. That's why I wore my favorite suit and one of my favorite ties, because I love going to court. It's one of the things I like the most about being an attorney. So we are going to talk about the basis for the Huntsman lawsuit. We're going to talk about the previous procedural history of the case that got us to where we're at in the first, the oral arguments today. And then we're going to talk about some of the substance of the case after the fact.
Kolby Reddish [00:04:02] And we'll also talk about some interesting tidbits that I found last night looking at amicus cure that are joining the church's position at a high level. As a reminder for our viewers, in a legal sense, this case is about financial fraud and specifically financial fraud. James Huntsman, the plaintiff, is alleging that the church committed financial fraud when it solicited tithing donations specifically because it made certain promises, at least according to Huntsman's theory of the case, that it made specific promises about ways it wouldn't use tithing funds to go towards completion of the City Creek Mall project in the early 2000s. And so the. At a high level, I guess one of the things I wanted to start off reminding people is that fraud or financial fraud is in a legal sense, to knowingly make a false statement to induce another person to rely on it.
Kolby Reddish [00:04:53] So that's the basis of Huntsman's allegation, is that the church made certain, certain statements that were false that time is basically proven to be false that induced Huntsman as well as other members, tithing donations and that if they had known the truth, they would not have made those tithing donations. And so one of the ways I kind of conceive of this is that it's a. It's basically making a statement or adding some condition that is false or misleading. And so the basis for the Huntsman claim is five statements that Huntsman claims the church made that were misleading specifically with regard to the use of tithing funds going towards City Creek. So if you can go back one Slide real quick, John.
John Dehlin [00:05:45] This one.
Kolby Reddish [00:05:46] Yep. I just wanted to again, remind people we have three different cases that basically involve similar allegations. On Monday, we talked about, about the Gaddy case, so people can listen to that live stream if they want. Today, we're going to talk about the middle case here, the Huntsman oral argument, which is set for an ong bonk rehearing today at the Ninth Circuit after the case was dismissed by the trial court and then reinstated by the first appellate panel, finding that Huntsman did have or did allege sufficient facts to present his case ultimately to a jury. So that's one piece I guess I wanted to start with.
Kolby Reddish [00:06:17] Just to make clear when we're talking about appeals, I talked on Monday about how appeals are a very specific set of practice of the law. It's a subset of practice of the law that involves complex legal questions oftentimes. And so when you have a case like that, you can rarely have a situation where a district court's decision is reversed, as happened in Hunson's case. And then even rarer still, you can have a case where one side of the dispute asks for the entire 9th Circuit panel to grant what's, what's called an en banc rehearing. And that's where the chief judge of that circuit, as well as 10 randomly selected judges, will sit and rehear the case.
Kolby Reddish [00:07:02] And part of the reason for that is because the original panel decision was closely divided. It was two to one. So that means ultimately two, two federal judges have sided with Huntsman and two federal judges have sided with the church.
Kolby Reddish [00:07:15] The third, the third case that we talked about on, on Monday, just briefly, is there's also district court litigation that started in the District of Utah in front of Judge Robert Shelby that involves very similar claims to James Huntsman's. So James Huntsman's case only involves James Huntsman's claim that the church defrauded him in soliciting tithing donations.
Kolby Reddish [00:07:36] And I guess that's important for people to keep in mind is that huntsman is claiming $5 million in tithing that he feels was fraudulently, fraudulently gotten from him. But one of the things we know about the legal field is that oftentimes we have test cases like Huntsman's that then can, can create breakoffs in the law or create new areas where the law can develop, and that's the Chappelle case. So one of the first things I wanted to do, because I get questions like this every time we do one of these podcasts together and talk about these tithing cases is I get questions from people, including at work, about how do I join these class action cases.
Kolby Reddish [00:08:11] The Chappelle case is seeking class certification here soon. And so the first thing I wanted to start with is if you're interested in this issue, I promise that eventually we'll be able to give you more direction on how to join the class in the Chappelle case as it moves forward, if it moves forward.
Kolby Reddish [00:08:28] But for right now, we just need to be patient. There's no way to join the class right now because no class certification process has even started. So there's going to be some filings that go back and forth in front of Judge Shelby in the Chappelle matter. As long as John will continue to have me, I'll continue to come and keep people apprised of how they can join that class when and if that happens. So that's the first thing I wanted to get out of the way. The second thing is I wanted to note, based on some feedback I received from a believing member, which I really appreciate from Monday's episode in the comments section, they had asked me why, when I'm talking about the statements that individuals like Huntsman or Gatti or in the Chappelle litigation, when I'm talking about various statements that church leaders have made, specifically on Monday, I was talking about a statement that Gordon hinckley made in April 2003.
Background on Church Statements and Tithing Fraud Claims
Kolby Reddish [00:09:15] This believing member was asking me, why, when I'm talking about these statements, do I always take the most cynical read of those statements? And one of the things that I wanted to explain, that I did explain in the comments to this individual, but it was a very good note because I want to address this is it's very important for people to understand that at this stage in a litigation that the plaintiffs, meaning James Huntsman and Gaddy, as well as Chappelle, they are entitled to every favorable inference of fact. The idea is these cases were resolved at the district court level on either motions to dismiss or motions for summary judgment from the church.
Kolby Reddish [00:09:51] So those in the legal field are what are known as dispositive motions. They're motions that dispose of a case. At a layperson level. It's basically me saying to John that, you know, someone has wronged me. And that person coming to John and saying, I admit that I did what Kolby said, but what I did wasn't wrong. And so that's one of the reasons, at just a basic level, that I'm reading those statements in that way. It doesn't have to do with any bias. I have against the church or the fact that I'm an ex Mormon. It has to do with the fact that the law requires that the plaintiffs, who, like every other party, are entitled to have their day in court, so long as they've stated a claim upon which relief can be granted, that they have the right to offer their case to a jury ultimately, as long as the church's arguments on these motions to dismiss are not recognized.
Kolby Reddish [00:10:42] So I wanted to address that comment head on and just make clear that as a matter of appellate law, when we're talking about appeals, that's where I'm coming from. And I should have been more clear about that on Monday.
Kolby Reddish [00:10:54] But I wanted people to know that, that especially when we talk about the statements from President Hinckley and other church leaders towards the end of our stream today. That's why we're looking at them in that way, because that's what the law requires. So, Julia, if you'll go to the next case or the next slide for me.
Kolby Reddish [00:11:10] Okay, perfect. So this is to get people acquainted, if they haven't heard already, about the theory of Huntsman's lawsuit. So James Huntsman is a member of or was a member of the LDS Church, and he contends that the church made various false statements about the nature of funds used in the City Creek Mall commercial project while it solicited tithing donations from him in the amount of $5 million. So that is ultimately the amount he's seeking to reclaim from the church. I know that someone had asked about that in the comments. That is publicly known. Huntsman ultimately contends that the statements the church made, in particular one from Gordon B.
Kolby Reddish [00:11:43] Hinckley in 2003, are false, according to leaks that came to light from Ensign Peak insider David Nielsen, and that, in essence, the church used tithing funds to build City Creek Mall when it said that it would not. The church contends that it did not mislead anyone based on reading each statement in a particular light. The church also argues that the case itself, like just bringing a case questioning tithing donations or conditions on tithing donations, violates the First Amendment's protections of religious freedom and the Establishment Clause and the free Exercise Clause. And I just wanted to know on that particular argument that no judge, including the two, who at the district court level and then on the first Appellate panel, ultimately found for the church, have agreed with that argument.
Kolby Reddish [00:12:27] So all four judges who have heard this case have said that this case does not implicate the First Amendment. That's one of the delineating factors we talked about on Monday that I see between this case and one of the reasons I think this case has a much greater chance to succeed than, than the Gatti case is because the Gatti case does involve some claims that arguably fall within the scope of the First Amendment, While this case, no judge has agreed with the church's position on that, that this case implicates the First Amendment.
John Dehlin [00:12:54] So, so if you go after a church for teaching false things or misrepresenting its history, that's, you know, that's sketchy ground. You're treading on First Amendment territory, and judges are going to be inclined to not mess in that area. But if you're alleging pure financial fraud, totally disconnected from truth claims or history or beliefs, you're on much safer legal territory. Is that right?
Kolby Reddish [00:13:24] That's exactly right, John. That's exactly right. The idea again, that we talked about on Monday is if the claim that you're bringing is the same type of claim that you could be bringing against any other secular institution, like an institution that could be just could be a religion, but also could be any other type of claim, then you're probably safe from a First Amendment perspective. And that's one of the great things about Huntsman's case. So procedurally, just a few minutes before we start with the oral argument, Julia, will you go to the procedural slide?
How the Case Reached the Ninth Circuit
Kolby Reddish [00:13:57] Perfect. So as I said, Huntsman's case was originally dismissed by the trial court judge. It started in the district of California, so in a California federal district court. And Huntsman appealed that decision to the Ninth Circuit, as we talked about, he won in a 2 to 1 decision from the panel, finding that when the statements that we're going to talk about towards the end of our stream today were read in the light most favorable to Huntsman, the church could have been found by a reasonable jury to have committed fraud. And so that's again, one note about appellate procedure that I wanted to make sure our viewers understand is if Huntsman wins today's oral argument and oral arguments are not decided the day that they're argued, the case will take, or, I'm sorry, the court will take the matter under advisement and likely render a decision in a few months.
Kolby Reddish [00:14:40] But if Holtzman Huntsman ultimately prevails, it does not mean that the LDS Church committed fraud. It means that James Huntsman has the opportunity to offer his case to a jury to make that case. That's, that's what's being determined today is basically under the, the law as it stands does has he stated a claim that he has the opportunity to present to a jury.
Kolby Reddish [00:15:03] Now, the church requested an en banque rehearing, which is very rarely granted, and the ninth Circuit granted the church's request. And so the matter today will be heard in front of 11 judges of the Ninth Circuit Court of Appeals.
John Dehlin [00:15:15] So help me understand, if three judges in the Ninth Circuit, you know, overturned the original judges ruling, how do they get another shot at nine judges? Is that, is that just part of the legal process? It's just part of the appeal?
Kolby Reddish [00:15:33] Yeah, it's part of the appellate process. And it's actually a great question from like a history of the judiciary perspective, John, because the only, the only federal court that's really required to be to exist by operation of the federal constitution is the Supreme Court of the United States. The rest of the federal system is created by federal statute. And so it's a right that arises by operation of the federal statutes that govern appellate procedure.
John Dehlin [00:16:01] Kolby, really quick, we have a question in the form of a super chat. Ryan writes, couldn't you say other companies make truth claims that can be disputed and they reference essential oils, herbal medicine, other sorts of things? Anything you want to say about that?
Kolby Reddish [00:16:18] Yeah, I guess I'd say that if you want to start an herbal medicine, an essential oils or herbal medicine company that you feel like may run aground of fraud cases, maybe you should incorporate it as a religion. I guess that's the only thing I'd say.
Kolby Reddish [00:16:33] Yeah. And it's one of the things that's complicating about this case because we do have this recognition in the First Amendment that especially in America, the religion has this, I would call it a privileged position. Other people would call it religious freedom. Regardless of what you call it, the bottom line is that for religions, for incorporated religions, the rules simply are different. And that's where, you know, we talked on Monday in detail about the church autonomy doctrine and why I think that policy actually is sound, that churches should have. Churches and religions should have the ability to set the rules inside of their own congregation in matters of, you know, their internal procedure and rules, I may disagree with those rules.
Kolby Reddish [00:17:12] But I think just as a matter of the way the First Amendment works, that they do have that right. If people wanted additional detail on the actual decision, the original panel decision that reversed the district court's dismissal, we did discuss this on an episode of Mormon stories 1796 with Radio Free Mormon, Rebecca Biblioteca and myself.
Kolby Reddish [00:17:34] So if people want to listen to that, they can get additional background on that decision. We actually walk through every single line of it and have multiple, multiple discussions about it. I wanted to highlight just a few relevant facts in the panel's decision to give people the context if they haven't listened to the bat that past episode. And I know it's been, it's been about a year since we did that anyways. But one of the relevant facts in the panel's decision, I think is very important is this David Nielsen affidavit. For people who don't know, David Nielsen is the Enzyme Peak whistleblower whose report was leaked, I believe, to the Washington Post in late 2019.
David Nielsen's Affidavit and Ensign Peak Allegations
Kolby Reddish [00:18:09] And David Neal, this is a direct quote from David Nielsen's affidavit in the panel's decision. Again, that led ultimately to where we're at today. He stated, quote, during my employment at Ensign Peak Advisors, EPA senior leadership and other EPA employees referred to all funds of EPA as tithing money, regardless of whether they were referring to principal or earnings on that principal. In addition, during my time at epa, tithing donations from the church's members were commingled with earnings that Ensign Peak had made. And the reason that this is very important is because, as we'll see, and hopefully they'll discuss that oral argument, there's one statement in particular from Gordon Hinckley in April 2003, where the church is really trying to create this separation between tithing donations and invested reserve funds, which also came from tithing.
Kolby Reddish [00:18:55] And so David Nielsen's affidavit is, is basically one of the biggest reasons that this case is if it ultimately heads to a jury. I would say that fact alone is one of the biggest reasons for that.
John Dehlin [00:19:06] I don't want to steal your thunder, but if I remember right, also they talked about explicitly at Insign Peak, David Nielsen reports that that there was explicit intent expressed to, to hide the amount of money and the existence of this money for fear that members would pay less tithing. And it maybe there's a slide. You're going to talk about that. Is that right?
Kolby Reddish [00:19:33] That is the very next slide. But John, I'm so sorry. You can still. You can steal my thunder anytime. It is your show.
John Dehlin [00:19:40] Go for it.
Kolby Reddish [00:19:41] So this is right from the panel's decision last year. Nielsen further affirmed that a 2013 meeting, Enzyme Peak's president, Roger Clark advised of two withdrawals from Enzyme Peak. One was for $1.4 billion over five years to fund City Creek. At the presentation, Nielsen asked Clark how the church's public statements about no tithing funds being used for City Creek Mall or Beneficial Life could be consistent with the withdrawals for those projects. According to Nielsen, Clark answered that funds for the City Creek Mile project were transferred from Ensign Peak to Property Reserve in order to conceal the source of the funds. So that right there is that intentionality piece that you're talking about, John.
Kolby Reddish [00:20:20] Mr. Clark responded that two other church affiliated entities, Property Reserve and Deseret Management, had received from Ensign peak the 1.4 billion and 600 million respectively, paid by Ensign Peak for City Creek Mall and Beneficial Life. And essentially that as a result, people would not know that Ensign Peak was the source of this funding to City Creek Mall and beneficial life.
Kolby Reddish [00:20:43] Mr. Clark stated that it was important that people should not know Enzyme Peaks role as the source of the funds. One of the things I also wanted to highlight, I don't have this on a slide, but the church also filed two declarations that did not contest this. So Roger Clark himself actually filed his own declaration that did not contest, even though he, he could have, right? He knows what he said. He could have said. I didn't say what David Nielsen says. And the panel decision from last year actually draws attention to that to basically say he could have contested this and didn't. And one of the things that we know as a result of the SEC order that Enzyme Peak was involved in last year, I think it was in February 2023 that the church entered into a stipulated settlement with the securities and Exchange Commission.
Kolby Reddish [00:21:29] We know now that Enzyme Peak was created with $7 billion in excess tithing in 1997. And we know that its manager, Roger Clark, and the church's senior leadership were so involved in starting it and taking such extreme measures to keep the entire thing confidential that they ultimately admitted to violating federal securities law for over two decades. And that resulted in the imposition of a $5 million fine which the church agreed to. It's important to note that of that $5 million, $1 million was imposed directly on the church. Like the church had to pay that directly from its own accounts. And that was because of senior church leadership, knowledge of involvement in and approval of the practices of creating shell companies that did not actually have control of the assets that federal forms that they filed said they were managing.
John Dehlin [00:22:17] And again, I think one of David's biggest concerns was both for his own tithe paying, but also on behalf of the membership that he, nor did he think the members had any idea that all this tithing money they'd be paying instead of going to charitable, legitimate charitable uses, would instead be going to bail out a luxury shopping mall and a failed insurance company. Is that correct?
Guest [00:22:43] Yeah.
Kolby Reddish [00:22:43] That's exactly right.
John Dehlin [00:22:44] Yeah.
Kolby Reddish [00:22:45] The one last little note I would, I would say as we head into the oral argument here in about five minutes is one of the things that was slightly irregular about this case and maybe we'll see a focus on it. Oral argument. It's kind of exciting because we don't know the panel actually sent the party's notice just a few weeks ago, which is kind of irregular, that they wanted the parties to be prepared to address the issue of Huntsman's residency at oral argument. If you'll go to the next slide, John, I think I've got it. Yeah, perfect. So the reason that the, the court is asking for Huntsmen and the church to be prepared to address this is because federal courts are, are courts of limited jurisdiction.
Kolby Reddish [00:23:27] So when you asked earlier, John, about, you know, why does the en banc rehearing work the way it does, it's because we have statutes that govern the federal judiciary and the federal courts are only able to hear certain types of cases at a high level. The types of cases they are able to hear are either cases that involve federal claims, so some federal statute, or to hear claims between citizens of different states. That's what's known in the legal field as diversity jurisdiction. So for Huntsman's claims to have been properly brought in California and the Ninth Circuit rather than in Utah and the Tenth Circuit, he must have been a resident of California and not a resident of Utah.
Kolby Reddish [00:24:08] And the reason is because he's not alleging any violation of federal law by the church, only violations of California's state statute and some common law causes. And so I was just going to say what that means is if the court ultimately finds the, that Huntsman was a resident of Utah, as disappointing as this would be, it means that it cannot consider the merits of the party's positions at all. So if the court, if we hear a lot of questions about that and it seems like it's not going Huntsman's way, what that means is that the federal court does not even have the jurisdiction, the subject matter jurisdiction to consider the case.
Kolby Reddish [00:24:45] They will dismiss the case as being improperly brought. And that's likely what they'll do if they ultimately determine that Huntsman was not a resident of California at the, the relevant time period.
John Dehlin [00:24:55] And I could just say I've been a friend of, of, of James Huntsman for many, many years, and I know for a fact that he moved to California as I just, you know, sold his house, moved to, you know, the San Diego area and lived there, you know, and was living there when. When he filed this case. So that's my understanding. I have personal connections there, and unless there's some technicality that I'm unaware of, there should be no legitimate question to his California residency.
Kolby Reddish [00:25:31] Oh, that's interesting. Since you're friends with him, that's interesting to hear the reality of that test. It's a test that's known as the domicile test is it does have some weird subjective elements, but for most people, it's fairly easy to determine where they live. Right. Like I've lived in Idaho for the past 10 plus years. And unless I had some intention of moving, that's one of the ways that basically the test can get a little bit more complicated. So that's. That kind of sets the frame for what we expect to see. It'll be really interesting to me to see how many questions we see from the panel, whether the questions focus on that issue of subject matter jurisdiction we just talked about, or if they get right to the merits of the case. I think it'll be really interesting to see ultimately how it evolves.
Live Oral Argument Begins
John Dehlin [00:26:15] All right, well, let's go ahead and add the hearing. It's gone live. They haven't started yet, but now it is there. We'll come back. We'll just let the viewers and listeners know. We're going to come back and, and allow Kolby to do some further insight after the hearing begins. But Kolby, really quickly, we've got a couple super chats, Susie. Catherine basically said, keep up the good work. They aren't going to get my money. Thank you, Susie, for that super chat. Son of perdition. Asks you, Kolby, do you think this would lead to laws restricting churches from telling false narratives?
Kolby Reddish [00:26:56] Yeah, we talked about that a little bit on Monday. You know, on Monday's oral argument, the attorney for the church essentially argued there's no limit to the misstatements that a church can make. It basically can't be held to account for any statement it makes about its history. And I use this phrase on Monday. I'll use it again today. There's this notion sometimes in the law that pigs get fat and hogs get slaughtered. When I say the law, I just mean it's a concept that we see sometimes where these pendulums swing back and forth. And so ultimately, if that is the result, that basically the church can say whatever it wants and it can't be held to account of it. And that's what the First Amendment means, you may see some shift against that in the court of public opinion. And ultimately, that's what leads to legislation and potential amendment of the Constitution, even if necessary?
John Dehlin [00:27:42] All right, well, here's the. Here's the view inside the courtroom. It's literally 3:30. Only I could hear the audio coming online. So this is kind of fun, Kolby, to be doing a live broadcasted analysis. How do you feel?
Kolby Reddish [00:28:01] I feel great. I think next time we need to coordinate tan suits.
John Dehlin [00:28:04] John, I know I'm a slime, sloppily dressed. It's my fault. I'm just. I'm feeling overworked right now, so I just came in in shorts and sandals, but it's not appropriate courtroom attire. Fortunately, the judge won't be seeing me, so. So that's kind of fun. It would be kind of fun to actually travel to San Francisco to be there live, but we've just got too much going on, including, again, Nemo's excommunication tomorrow. Here it is. The judges now roll it. The. The judges are now rolling in. Any analysis, Anything that's interesting of note,
Kolby Reddish [00:28:46] Kolby, you'll see the weird antiquated formality of the way we still do the court system. I find it interesting.
John Dehlin [00:28:56] The United States Court of Appeals for the 9th Circuit is now in session.
Guest 2 [00:29:03] Thank you. You may be seated.
John Dehlin [00:29:07] Wow, so many judges.
Guest 2 [00:29:09] Good afternoon and welcome to all of you. Welcome to the James Browning Courthouse here in San Francisco. We're all happy to be here. This is the time, except for the case of James Huntsman versus the Corporation of the President of the Church. Church of Jesus Christ of Latter Day Saints. If the lawyers are ready to proceed, you may come forward.
Kolby Reddish [00:29:35] This is the Chief Judge of the Ninth Circuit, John Mary Merda.
Guest 3 [00:29:39] Good afternoons, and may it please the court. Your Honors, my name is David Janellis, and I represent Appellant James Huntsman. Before I begin, may I reserve five minutes for rebuttal? Thank you. I'd like to start, your honors with a quote from a song that I'm sure you all know. When I find myself in times of trouble, Mother Mary comes to me speaking words of wisdom. Let it be. In most contexts, the name Mother Mary has religious connotations, but here, it's just Sir Paul McCartney singing about his mother, Mary. McCartney. It's secular. And the same is true of the word tithing. Your Honors, in many cases, that word would invoke religion. But here, in this narrow case, the implications are no more religious than the song Let It Be.
Guest 4 [00:30:38] How can you say that? I understand the importance of avoiding constitutional questions where we don't need to do that. But, for example, the Supreme Court and Presbyterian Church vs. Mary Elizabeth Blue Hull, that dealt with a trespass claim, Our lady of Guadalupe, which dealt with an employment claim, and Kedra vs. St Nicholas Cathedral of Russian Orthodox Church, dealt with an incorrect incorporation of secular legal principles to church governance. Why, in this case, where we're dealing with tithing, which you would agree is a very common principle among many, many religions. You've seen some of the arguments from the opposing council, more the amicus council, talking about the many differences that there are among religions about the meaning of tithing. But to my understanding, tithing, unlike your mother Mary example, is a quintessential religious issue. In fact, I don't know of any use of the term tithing that is not religious in context. What am I missing?
Guest 3 [00:31:45] Your honor, you've cited three cases in which the court's decision. Sorry, the church's decision making functions were at issue. For example, in Our lady of Guadalupe school, as your honor noted, that had to do with a decision to hire or fire. It was employment. Which is why the ministerial exception applies. What we have here is more similar, Your Honor, to U.S. v. Rasheed, wherein this circuit found that even where there, it wasn't called tithing, but it was still a donation made to the religious organization under a supposed commandment of God.
Guest 3 [00:32:20] And the organization in that particular instance had not disclosed how the money was being used truthfully. And this circuit found that it doesn't matter, that the concept of donation may be cloaked in religion. That's not a way to get away from fraud. And, your honor, this is a fraud case, a simple fraud case for which the first amendment provides no sanctuary. And frankly, that's why every single judge that's looked at this case so far has reached the same conclusion with respect to the first amendment, even where they may have staunchly disagreed on other issues. And to this point, your honors, I'd like to spend my limited time here today addressing three points.
Guest 3 [00:33:00] First, the secular nature of this dispute. Second, inferences that must be drawn in Mr. Huntsman's favor. And third, the slippery slope. And I also understand that the panel has requested that we be prepared to discuss domicile. And should the panel have questions, I'm happy to address.
Guest 4 [00:33:19] I may be going to address this, but I hope you will. Your claim sounds under California tort law for fraud. And one of the elements of that, of course, you know, is justifiable reliance. I'd be interested to know, wouldn't you be asking a jury to determine whether Mr. Huntsman's reliance was justifiable? And in order to do that, wouldn't you have to understand what a reasonable church member would know, which would get you into the religious context at some point. Will you answer that question, please?
Guest 3 [00:33:53] I'm happy, Judge Smith, to answer that question. Now, with respect to the issue of reliance, and again, this gets me to preview my second issue of inferences, we have Mr. Huntsman's sworn testimony on pages 44 to 45 of the Record unequivocally that he relied on the church's statement that the money for City Creek was coming from somewhere other than tithing. In fact, the church on one instance at least went so far as to say not one penny of tithing was used. And Mr. Huntsman has stated unequivocally that that mattered to him, it was material, and that that impacted his decision to donate tithing.
Guest 5 [00:34:36] It still has to be reasonable reliance. Right? That's the test under state law. So he may subjectively believe that, but we would then have to ask, or a jury would have to ask, is that reasonable?
Guest 3 [00:34:47] That's correct, your Honor, again, at that
Guest 5 [00:34:49] point, sorry to cut you off, but the question would be how is that not essentially weighing his belief that he gave tithed monies as a condition for something and the church's view that tithe money is a required commandment?
Guest 3 [00:35:07] Because, you, Honor, in the context of the reliance here, Judge Bress, it's a secular issue. It's one of accounting. And that's the fundamental way we would submit that this case has been misframed by the church. Respectfully, yes, Tithing is a religious doctrine, a commandment from God, as the church would have it be known. However, to address tithing in the context of this case, with the facts at bar, we don't need to look at any commandment. We need to look at the church's own secular definition of tithing, which at the record, it's 682.
Guest 5 [00:35:44] And just to pause you, I don't. How can a church have a secular definition of a religious obligation? I don't understand how that could be,
Guest 3 [00:35:53] because it's not about the reasons for giving tithing in general. It's the reasons for giving the tithing in this particular instance. Again, it's a very.
Judges Question How the Case Can Be Tried
Guest 6 [00:36:02] Let me follow up on that because I'm really struggling to understand how this case would be tried without really delving into not only the church's view of what it's doctrines dictate, but Mr. Huntsman's own understanding of tithing and how tithing donations would be utilized. I thought that he had testified at Numerous points in his declaration talking about how when he gave the tithing money, there were no conditions put on it. And the reason was that as a longtime church member, he had a very firm understanding of what tithing really meant. And all of that understanding really stemmed from church doctrine or his understanding of church doctrine.
Guest 6 [00:36:48] So I take it that your argument really tries to narrow the trial on the few statements that were at issue in this case. But if this case were to go to trial, wouldn't the church be entitled to pull the lens back and talk about tithing, the purposes of tithing in general? They would be able to talk about President Hingley's statements not just as narrowly defined as you, but much broader than that. And in response, then, Mr. Huntsman would also potentially testify about his own understanding religious doctrine. I just don't see how this case could be tried as narrowly as you're contemplating. Can you respond to that?
Guest 3 [00:37:28] Of course, your honor. And this goes to Judge Rest's question as well.
Guest 6 [00:37:34] Yes, I'm really struggling with the same area that his question questions went to.
Guest 3 [00:37:38] I think we need to respectfully back up for a moment just to talk about this case, because you've referenced what the case is about. And let me be clear, lest this has been misframed by the church, Mr. Huntsman, in this case does not challenge how the church ultimately chooses to spend its tithing, even if it spends the money on City Creek or on Beneficial Life. That's the church's prerogative. That's protected, admittedly, under the First Amendment and 14th Amendment, the autonomy doctrine, whatever we want to call it, and completely distinct from the issue here. The issue here is how the church told Mr. Huntsman, under its definition of tithing, which again, is not secular, the church has used general accounting principles to describe the tithing here.
Guest 3 [00:38:28] If we look at page 682 of the record, the church has stated that tithing, as President Hinckley apparently understood it in 2003 during his general address. Was the principle the money that my client, Mr. Huntsman, took and gave to the church before it was invested anywhere else?
Guest 7 [00:38:47] Does it matter that the April 2003 speech came from President Hinckley in this religious context? In other words, this isn't just any old speech. It was given in this broader sense of describing the church activities and religious mission. And isn't there a concern, if you're asking courts to start parsing these speeches, whether it's going to chill something within religious doctrine or internal church governance that a church leader might have to run A speech by legal before he can deliver a sermon.
Guest 3 [00:39:26] No, your Honor, and respectfully, that actually piggybacks very nicely on Judge Bress and Judge Wynn's question. I can answer all these together because the answer would be no more so than the religious statements made in Rasheed, no more so than the religious statements made in Maktab Tareeg or in Animalai or in any of the other cases where our Supreme Court or this circuit or other circuits, such as the 11th Circuit in Animalai or the Court of Appeal in Texas and Libhart, have addressed issues where in the context of a sermon, for example, in Rasheed, Pastor Rashid told his congregants, it is God's will from the pulpit that you give your money as ministers, and it will be quadrupled under the will of God in that case, just as we would submit in this case, Pastor Rashid knew at the time that he made that statement that it was not actually going to be quadrupled under the will of God.
Guest 3 [00:40:23] It was going to be quadrupled by all of the other donations that were taken in. In what this circuit characterizes a pyramid or Ponzi scheme in this case. Likewise, there is, at a bare minimum, your honors, a triable issue of fact as to when President Hinckley and Bishop Burton and the church's official magazine and the church's statement to Deseret News and Keith B. McMullen's statement to the Salt Lake Tribune at the time that all of those statements were made on five about McMullen.
Guest 8 [00:40:57] Don't we have to decide whether or not McMullen can speak for the church? And isn't that a religious question?
Guest 3 [00:41:04] No, you, Honor, because at the time that McMullen made the statement, he was speaking on behalf of the church, and he said that not one penny of tithing.
Guest 8 [00:41:13] So we.
Guest 5 [00:41:13] He.
Guest 8 [00:41:14] I mean, how do we know he was speaking on behalf of the church?
Guest 3 [00:41:17] Your Honor, that would be a question that could be asked in discovery should this case proceed.
Guest 8 [00:41:22] Isn't that precisely the problem, though? We're supposed to ask who can speak on behalf of the church. So what if the church says, no, he wasn't speaking on behalf of us, and then we're going to decide as a religious matter that he was speaking on behalf of the church?
Guest 3 [00:41:37] First of all, your Honor, the church has never questioned that issue. In fact, in the Record poll, hypothetical.
Guest 8 [00:41:44] What would happen in that case, hypothetically,
Guest 3 [00:41:46] if he was not speaking upon the church and if the church chose to distance itself, which it had the opportunity to do. I mean, that Statement was made, as we know, in 2012. This case was filed in 2022. There was ample opportunity for the church.
Guest 8 [00:42:00] So what would happen in that case, though, then we would have to say the church is wrong, that Keith McMullen actually was speaking on behalf of the church.
Guest 3 [00:42:08] The church would. In your hypothetical, if the church denied that Mr. McMullen was speaking on behalf of the church and said, no, none of these five individuals were speaking on behalf. And really, it was something completely different, even though one of the individuals, President Hinckley, was, according to the church, was speaking on behalf.
Guest 8 [00:42:26] But the bottom line is we can say, no, the church is wrong. Keith McMillan was speaking on behalf of the. The church.
Guest 3 [00:42:31] Based on the record, yes. And in your hypothetical, we'd have to address it in the facts at Barr. But the issue.
Guest 8 [00:42:36] But how is that not, like, deeply entwined with religious matters, then?
Guest 3 [00:42:39] Because if that was deeply entwined in religious matters, a simple issue of is somebody speaking on behalf of an organization? Where would we even draw the line as to what's religious and what's not, so long as linguistics and vernacular are religious? I mean, this gets back to the issue of let it be and tithing. And it shouldn't be. It wouldn't be equitable or consistent with the intent of the first and 14th Amendments and the doctrine stemming. Therefore, to say that simply to use this circuit's terminology, simply because you invoke religious terminology, you're now cloaking civil torts in immunity. That's not the purpose. When there are issues here. And this again gets back to the questions. These are accounting issues.
Guest 4 [00:43:24] They the church council. With respect, if I understand the record correctly, President Hinckley never said these are accounting issues. Mr. Hudson was a member of the church for many years, continuing to pay well after President Hinckley said what he agrees. He said, he says that he understood President Hinckley to say that tithing was treated in two parts. There's the principles given and then the reserve. The church later showed that it was just the reserve was being used. You got four statements after the original statement that he didn't break it down that way. But Mr. Huntsman knows, and the record shows that unless you want to get into LDS doctrine, which you can't do, President Hinckley is the only person, the only person who is authorized to speak authoritatively on behalf of the church. So you say that's not true, but then you get into church doctrine to say otherwise, do you not?
Kolby Reddish [00:44:21] Respectfully.
Guest 3 [00:44:21] No, you don't.
Guest 6 [00:44:22] Your honor.
Guest 4 [00:44:22] How's that?
Guest 3 [00:44:24] First of all, Mr. President Hinckley was not the only person to speak on behalf of the church to.
Guest 4 [00:44:31] And on what do you rely for?
Guest 3 [00:44:33] That I would cite to President, Bishop or, sorry, to Presiding Bishop H. David Burgess.
Guest 4 [00:44:38] The bishop. The Presiding Bishop of the church is an inferior officer of the Church. There's only one person, prophet and president of the church. Mr. Huntsman's record indicates that he speaks for the Church, nobody else. So how do. Now, you would say that's not true, but then we would be required to get into the LDS doctrine and for you to show that he wasn't the only person, right?
▶ Video Clip 1Video Clip 1 [00:45:02] No, Your Honor, we'd have to apply common law issues again under.
Video Clip 1 [00:45:07] Unless the Constitution says otherwise, right?
Video Clip 1 [00:45:10] No, Your Honor, we would have to apply neutral principles of common agency law as to if somebody is holding themselves out as a representative of an organization, as a bishop and a president, and a statement made by the church to the church's publication to say after the fact to Monday morning quarterback and state, no, that wasn't a statement on behalf of the church because the LDS official spokesperson is not President Hinckley would open up the door for every religious organization, including in Rasheed. It wasn't just Pastor Rasheed who made the statement. It was Pastor Rashid's colleague who was not the pastor was just a minister. The same way that Presiding Bishop Burton is not the president. But everybody would be exculpated if they could say, well, other than the ultimate be all and end all, top of the pyramid person, everybody else isn't speaking for the church. That would be inconsistent.
Video Clip 1 [00:46:08] Well, would it? Because in this case, if you're looking at LDS doctrine, that the answer to that question is absolutely yes, he is the only person. And it's not agency law, it's religious law. And I don't understand how you can determine by applying common agency law to what LDS doctrine is. And if you're trying to get into LDS doctrine, it seems to me that the First Amendment bars us to consider it. Isn't that right?
Video Clip 1 [00:46:37] And respectfully, no, you, Honor. If we look at the record here, the representations that were made, starting with President Hinckley, where it may have been qualified, but continuing, it was qualified.
Video Clip 1 [00:46:48] And your counsel, I mean, your client apparently recognized that. He understood it, he heard it, he saw that President Hinckby was saying, you got tithing and you got basically reserve earnings and from the earnings of entities owned by the church. The church has shown by the record, as I understand it, that that's all that was being used to do the city Development, City Creek.
Video Clip 1 [00:47:15] Well, that is the church's position. Mr. Huntsman's declaration.
Video Clip 1 [00:47:18] Isn't that what the record shows?
Video Clip 1 [00:47:19] No, the Mr. Huntsman's declaration. If we look at the record at page 44 to 40 45, he doesn't differentiate. He just took Mr. President Hinckley at his word. And if we look at the qualification of Mr. Hinckley, meaning not his qualifications to be the president, but the qualifications of his statement, that.
Video Clip 1 [00:47:35] Okay, if you took it, if you took him at his word, then you take the first statement, then he would understand what president Hinckley was talking about. Right?
Video Clip 1 [00:47:42] The issue here, your honor, is we can take that. We don't have to. If the court is so inclined not to look at the subsequent four statements, if to take your honors position, as I understand it, that President Hinckley is the be all and end all. And we just look at his statement, and we look at how his statement has been explained in the record as he was referring purely to principle. That does not change the ultimate disposition of this.
Video Clip 1 [00:48:07] Who says that he was just referring to principal on the first talk. I'm sorry, your honor, who says that President Hinckley in his first remarks was just referring to principal?
Video Clip 1 [00:48:18] The church, your honor.
Video Clip 1 [00:48:19] The church says that the church has
Video Clip 1 [00:48:21] differentiated in their papers between the principal donations made by members and the interest generated by the investment.
Video Clip 1 [00:48:30] That's what I'm. Exactly what I'm saying. President Hinckley made that clear.
Video Clip 1 [00:48:33] Council, can I want to ask a question on a different matter, I guess. What's your best case to support? That there was a misrepresentation here or that there was a factual dispute regarding the misrepresentation, Especially given that the church told its members that it would fund the mall with earnings on invested reserves. It appears that that's what occurred. So I wanted to give you a chance to address that.
Video Clip 1 [00:49:05] And respectfully, your honor, we would disagree that the record shows that's what occurred. What we have in the record is the church's testimony. And again, let's take. So we're not delving into meanings, let's take President Hinckley's after the fact explanation in the record as to what he meant. Principle. Let's look aside for a moment as from. For the issue of interest, let's just look at the principle. We have sworn testimony from David Nielsen stating, and this is in the record at pages 80 through 82, stating that Principal tithing funds were used to fund City Creek Mall and that beyond that, principal tithing funds were also commingled with the earnings on the principle.
Video Clip 1 [00:49:49] However, he's clear that even without looking at the commingling principal tithing funds. And that goes. And this goes to Judge Smith's question as well. It has to do. And this is my second point, with income inferences, we are on summary judgment. And despite all the First Amendment and, and 14th Amendment and constitutional issues, if we really look at what we're talking about here in the posture of this case, which is what's on appeal, we are at summary judgment. And on summary judgment, all of Mr. Huntsman's evidence must be taken as true, and all reasonable inferences must be drawn in favor of council.
Video Clip 1 [00:50:26] I'm sorry to interrupt you. Before you run out of time altogether, I want to give you a chance to address the diversity jurisdiction, because my concern is I'm not sure on this record, without further factual findings by this court, which wouldn't be appropriate, that there's enough to determine his domicile. As you know, the Burden is on Mr. Huntsman to demonstrate diversity jurisdiction. He moved to California shortly before the lawsuit was filed, but his company had a filing with the state of California that has the Utah address. So the out domicile involves an evaluation of a lot of facts, and a lot of them doesn't appear to be on the record.
Video Clip 1 [00:51:07] I appreciate that, your honor. And if I may respectfully put a pin in my answer, I will come back in about 45 seconds to the inference.
Video Clip 1 [00:51:13] I have a follow up for you as well.
Video Clip 1 [00:51:15] Fantastic. Your honor, to Judge Wynn's question. If we look, as you've recognized in the record at 213 and 214, what we know, which in and of itself is a far cry from the facts of Lou v. Moss, we know that Mr. Huntsman moved his family to California in October of 2020. We know this case was filed in March of 2021. We know Mr. Huntsman moved to California to be closer to his business, which is located notwithstanding where it may be registered, but it's located its offices in California. We know Mr. Huntsman came here for. You want it to be closer to the ocean, he said, too.
Video Clip 1 [00:51:53] And we know that at the time that the case was filed, there's no indication, unlike in Louvy Moss, that Mr. Huntsman had any intention to be anywhere else. And if we look at the circuit's decision in Mondragon B Capital One Auto Finance, this circuit contemplated, without applying it there, because the facts were different, that a party, that a court may treat a party's residence as a presumption of domicile in fact, others.
Video Clip 1 [00:52:19] The presumption is in favor of his established domicile, which is Utah. So I'm trying to figure out whether he overcame that presumption with what's currently in the record. He obviously has the ability to have homes in a lot of different places. And the. I know his business, Blue Fox Entertainment, had a California address, but the filing actually listed his personal address as a Utah address. So there's just a lot of. Given the timing of it, my concern is that the presumption should have been triggered and the district court. We would have benefited from findings by the district court, but neither party really raised this issue below, and the district court didn't sue. A spontane. Examine this issue.
Video Clip 1 [00:53:02] And we agree, Your honor. Well, of course, the court could sua sponte, address it. It was never challenged by the court. Therefore, there was never any response by Mr. Huntsman. And until this panel had raised the issue, it's never been in dispute. That said, we would welcome. If there's concerns by this panel that necessitate a remand to the district court on the limited issue of domicile, we'd welcome the opportunity to clarify the record put in the evidence, either through declarations or documents or depositions on that issue. That would not be a problem. And so it is a resolvable issue either through the presumption based on what's in the record already, which, again, is not like Louvy Moss, where the person was living in. In hotels in the challenged domicile at the time. This is. Mr. Huntsman was living in California, had his family here, moved here. I see a question.
Video Clip 1 [00:53:49] Yes. Sorry. Thank you. Counsel, do you have a position on whether or not the church autonomy doctrine is jurisdictional or not? It's an important question because whether or not we could skip right to the fraud analysis, or do we have to address this question of the First Amendment?
Video Clip 1 [00:54:04] Your Honor, it is jurisdictional insofar as conceptually a Article 3 court cannot. I don't. I'm not aware. Maybe there is a case that states it in terms of specific jurisdiction, but conceptually, yes, diction.
Video Clip 1 [00:54:20] But that was like over 100 years ago. So I just want to.
Video Clip 1 [00:54:22] Understood. And then recently, conceptually, perhaps, yes, insofar as if a church has to delve into issues of doctrine, the church cannot do so. But to address the issue here, it would be. It's a moot point because our position is, again, not our position, but the position of every judge has looked at it so far, is that this is secular. And again, it Just gets back to.
Church's Attorney Argues Against the Lawsuit
Video Clip 1 [00:54:47] Can I ask you, just on this point, one question one would have, looking at the lawsuit, is whether this lawsuit is allowed. Will it invite a flood of lawsuits by people who become disillusioned with their religion because many people are religious or belong to a religious organization, then decide that it's not for them? And in this case, the speech that we're speaking of is really more of a sermon. Are we going to. If this case goes forward, are we going to have situations in which lots of people are suing their church or their synagogue or something else asking us to resolve claims of religious nature?
Video Clip 1 [00:55:24] Your Honor, I see my time, once we take into account rebuttal, has run, and I would like to have time to respond to Mr. Clementa. I'd be happy to answer your question.
Video Clip 1 [00:55:31] Question.
Video Clip 1 [00:55:31] But I just wanted to.
Video Clip 1 [00:55:32] You should go ahead and answer Judge Brush's question.
Video Clip 1 [00:55:34] So the answer to the question is no. The precedent set here is very, very limited. If we find, again, this goes to the slippery slope. And in fact, if we just say had Judge Fletcher's prior opinion not been vacated, it would have had no impact whatsoever on how the church or any other religious organization practices its religion. The only precedent set by that opinion now vacated or by this court's opinion, if it's reinstated, is that a church in this circuit cannot lie about how it intends to spend the donations of its congregants. And so if that's the precedent that's set, we would submit that's a proper precedent.
Video Clip 1 [00:56:13] It's not inconsistent with doctrine. It doesn't require an analysis of doctrine. It is secular the same way it was secular in Rasheed, the same way it was secular in. In every case thus far, that's looked at the issue of fraud, not employment decisions. Your Honors, I'd like to just very quickly, in conclusion, tithing is a religious practice. Fraud is not. To hold otherwise would open up the floodgates to a litany of serious civil torts no longer being punishable. Thank you. Your Honors, I respectfully reserve my time.
Kolby Reddish [00:56:56] So now this will be the attorney for the church, everybody.
▶ Video Clip 2Video Clip 2 [00:57:00] Good afternoon, you, Honors. May it please the court. Paul Clement for the Appellees. There are at least two fundamental problems with the fraud claim by a former church member against his church here. First, there's no misrepresentation. The leader of the church explained that financing for a particular project would come from two buckets of church money and not from a third. And that is exactly what happens, as the record reflects. Second, and even more fundamentally, this kind of tithing refund claim is barred by the church autonomy doctrine of the First Amendment. This case ultimately boils down to the question of what a church leader meant and what a church member understood when the former talked about tithing funds in contradistinction to earnings on invested reserve funds.
Video Clip 2 [00:57:48] Councillor, can I ask you something? Because you had briefed and argued this case as first and foremost, no tribal question of fact, summary judgment should have been granted, and secondarily, the First Amendment. But I would have thought that given the church autonomy doctrine, that the arguments would go the other way in terms of the order. So I'm curious to see what your response is to, you know, why the defenses set up the arguments that way. And secondarily, assuming that the church autonomy doctrine doesn't stand in the way of reaching the summary judgment issue, there is still the declaration of Mr. Nielsen indicating that funds were commingled.
Video Clip 2 [00:58:28] So the two questions here, let me try to answer them in turn. You know, look, I think it's a challenge for a church when they feel they are falsely accused of fraud. Fraud in the context of the church leader speaking to the flock, it's a bit of a conundrum. Do you try to essentially clear the church's name by saying there's absolutely no misrepresentation here? Even if this were a completely secular case, there'd be no there there, or do you say instead, this is the religious autonomy doctrine? The church autonomy doctrine. I think, in fairness, the church was so convinced that there is just no there they're here, that it essentially wanted to clear its name and say, look, the easiest way to decide this case is to decide that there's absolutely no misrepresentation here at all.
Video Clip 2 [00:59:17] That's where I figured the answer was. But now then, on summary judgment, you want us to go there first? There is the declaration saying that the funds were commingled. So why doesn't that create a tribal question of fact for the jury?
Video Clip 2 [00:59:29] It absolutely doesn't, you, Honor. Because the fact that the funds may have been commingled for. For some purposes makes absolutely no difference under the secular law or under the church understanding of what President and Prophet Hinckley said. I mean, you know, it may well be that the people that worked at Ensign Peak looked at all the funds under their management, which at some broad level, like all church funds, probably came from the faithful. The fact that they looked at all of those funds as, in some sense, sacred, in some sense, the widows mite.
Video Clip 2 [01:00:02] Maybe I'm misunderstanding something because I thought the President Hinckley's statement was that, no, no tithing funds will be used, but that earnings from reserves would be. But in a comminglo mingling situation, then there may be an issue as to how that's teased apart.
Video Clip 2 [01:00:18] But here's the thing, your honor. I mean, you know, they may have been commingled for purposes of making an investment, but there was very careful record keeping. The they were not commingled for accounting purposes. And what the record here reflects in an irrefutable way is that the funds for this project that started out with $1.2 billion on January 1, 2004, and then were segregated from all other funds. That $1.2 million came from earnings on investment returns exclusively. And that is the unrebutted testimony, unrefuted testimony of Mr. Writing. And that's in his declaration in paragraph 14, and that's in excerpts of the record 538. So everything that was used.
Video Clip 2 [01:01:07] I just want to follow up on this because it seems that Mr. Huntsman is arguing that the church was fraudulently misleading because it did not speak with sufficient clarity about how it would use the tithes, these ties. And so I'm just trying to figure out why is he wrong, given that the 1991 and 1995 statements that are in the record point to several years removed and are not referenced within the 2003 statement.
Video Clip 2 [01:01:47] So, I mean, two things, your honor. First, you know, to the extent where saying, as Judge Fletcher did for the now vacated opinion, that the problem here is that the head of the church didn't speak with sufficient precision when addressing the faithful about tithing. I think that's why this is a first Amendment problem. But I don't actually think in the president and prophet's defense, I actually think in 2003, even if you look at that document in isolation, he spoke with sufficient precision because he is in a way that some of the Ensign Peak employees at a later time are not. He's talking about three different buckets of money.
Video Clip 2 [01:02:24] And he is distinguishing among in between those three buckets. And he says, okay, the church has some earnings from commercial ventures. And that corresponds to the fact that there was $150 million from an entity called PRI, that's the church's sort of real estate arm that's used as some of the seed money for this. So he talks about that bucket. Then he talks about another bucket that's distinct, which is, and I want to quote him directly, the earnings on invested reserve funds. And then he talks about a third bucket, which is tithing now, in a context where you're Talking about those three buckets, I think it is clear, even without the 91 statement, even without the 95 statement, that those earnings on invested reserve funds are different from tithing, which is, in the context of that distinction, more of the ongoing annual tithing of the faithful.
Video Clip 2 [01:03:14] And the only sort of contradiction here is the, is the testimony in the Nielsen declaration, which is all of three pages long. So I invite you to read it. It is not particularly damning, but he says, well, when they were working at Ensign Peak, they talked about all their funds, which included current year tithing funds and earnings on invested reserve funds. They talked about all of them as tithing Council.
First Amendment and Church Autonomy Doctrine Debated
Video Clip 2 [01:03:37] I would like to essentially piggyback on Judge Bimate's question about the First Amendment abstention doctrine. And if we, if I understand your argument to have been that if we were to agree with the district court in the sense in the now vacated three judge opinions reasoning on the merits of the fraud claim, that there was no need to abstain, but that it's only when you agree that you start to get into church doctrine and then there is a need to abstain as a matter of abstention doctrine as versus the pragmatic concern you mentioned before. Is that still your position that that is doctrinally correct.
Video Clip 2 [01:04:19] So I don't think we, I'm not aware that we took a position on that before. Let me tell you what my position.
Video Clip 2 [01:04:24] What is your position now?
Video Clip 2 [01:04:25] And this is just my effort to be helpful to the court. I mean, you know, it might be tempting for me to say, yeah, it's jurisdictional and we really would love you to decide the First Amendment question right now. But I don't think that's right. And I think there was a lot of confusion in the courts before Hosanna Tabor. But in footnote four of Hosanna Tabor, the Supreme Court clearly labels the ministerial exception as an affirmative defense. And then a few years later in Our lady of Guadalupe, they say that the ministerial exception is just a subspecies of the church autonomy doctrine. So I think if you put the Supreme Court's two latest pronouncements on this question together, you are left with the inescapable conclusion that this is not jurisdictional, it is an affirmative defense.
Video Clip 2 [01:05:12] And that has, that is, I should just add parenthetically, that is the virtue, of course, being coherent and true. There's Nothing about Article 3 about the church abstention doctrine.
Video Clip 2 [01:05:21] Can I just change the focus a little bit? The church primarily defends itself on Secular grounds on the basis that it was very clear what President Hinckley said at the beginning. When you look at what he said, when you look at what the accounting record showed, and the fact that the former employee of Ensign Peak wasn't there when this allegedly occurred, that it didn't really matter what the employees said. They weren't the profit. What I don't understand is why the definition of tithing funds, by definition, doesn't run into a First Amendment problem. If the First Amendment basically eclipses this, we don't even get into summary judgment issue. We never get to it at all. Why did the church take the position that this was just secular?
Video Clip 2 [01:06:08] So I don't think the church ever took the position this was secular.
Video Clip 2 [01:06:11] Not just my reading, right.
Video Clip 2 [01:06:12] No, I think they took the position that there was no misrepresentation here at all. And as I alluded to, I mean, I think that's actually an understandable temptation for any church when it's accused of fraud or misconduct, because obviously it's important to the church to be above board, holier than thou, whatever phrase you want. And so there's just this temptation to say we did nothing wrong. Now, I think I get that.
Video Clip 2 [01:06:38] I get that. I'm saying, since we're dealing with your colleague over there, he's saying, hey, look, this is just a sort. It's a tort. We think it's all secular. You seem to say it's secular. It all comes down to who said what, when and where. It's a material issue of fact. But if you have a focus on what the tithing means, then you run into the religious protection issue, which you never get to the other on. Help me with that, please.
Video Clip 2 [01:07:08] I'm happy to help you. I guess what I would say is, I think ultimately the temptation that this church, or any church has to defend itself as if it were a secular entity is maybe upon reflection, the best reason to apply the religious autonomy doctrine at the threshold. And just say we're not going to put churches in this position because we're going to make it crystal clear that when a member or former member of the church sues for a tithing refund, absent unusual circumstances, and I think there probably are exceptions for embezzlement or cases that would be different, where it's not general tithing, but it's a specific representation for a particular purpose, and the funds
Guest 4 [01:07:50] are divers, there's nothing. In this case, if I understand correctly, nobody's claimed that the church had a Ponzi scheme. Nobody claimed that some person enriched themselves or provided of jewels and so on for somebody. This is strictly an issue of the president of the church, who by LDS people, if he is the person, the authorized person says what it meant, it didn't change. Mr. Huntsman apparently read that, understood that if I gather he's taken the later four statements, he says, well, that's confusing. Well, it's not him to decide. Right. Otherwise, you have lay people deciding what the doctrine of the Church is. And that to me, gets back to the church autonomy doctrine, which maybe should be governing this case.
Guest 9 [01:08:37] I don't disagree. I think the church autonomy doctrine squarely covers this case. In my opening, I was going to give you two sentences on where there was no misrepresentation, and then I was planning to talk to you about the church autonomy doctrine for the balance of the time.
Guest 11 [01:08:49] So if we were to go with the church autonomy doctrine rationale, it sounds like you were starting to say that there would be still some cases that could be brought. And I'd like to hear more about that, like a hypothetical where there's been some tragedy, there's a fire in the next town, and now you've got orphans because their parents were killed in the fire. And the church says, we're collecting for these kids, everything in this basket will go to the kids, and then they spend the money on new clothes for the minister. Is that a case that could still be brought under your.
Guest 9 [01:09:19] Under my view, that is a case that can still be brought, and essentially doubly so. Because the way I would sort of think about this area of the law is you start with the presumption that the religious autonomy doctrine applies. But there are exceptions. The two exceptions that I think have been recognized by the courts over the years is one, call it embezzlement, just call it whatever it is ends up in the church leader's pocket. And then the second situation, which I think is different, and I think you could allow the claims to proceed without running afoul of the doctrine, is where it's not general tithing, it is a specific solicitation for a specific purpose, and then the funds are diverted.
Guest 9 [01:09:59] And I think that that latter case is different largely because a whole second problem, and I believe Judge Bress alluded to this in one of his questions, but a whole separate problem under the church autonomy doctrine with this claim is with the reliance elements.
Guest 9 [01:10:14] Because when it's tithing from the Church's perspective and from the perspective of a faithful adherent, that is a commandment, that is a scriptural commandment to give 10% of your earnings or your increase or your income that is really wholly independent of what the church does with it. And that's not the case, obviously, when it's a solicitation for everything in this basket is going to go to hurricane relief in a particular place.
Guest 11 [01:10:41] Are there limits to that though? So say it's Catholic Church that has always said we're against abortion and they collect tithes and then they say we would of course never support abortion and then they collect a bunch of money and they pay for abortions with it. Could you sue?
Guest 9 [01:10:55] I don't think you could. I think that's a hard case. It's a hard hypothetical. I understand it. But I think in that kind of general tithing thing, you know, you might be able to leave the church over it, but I don't think you can get a refund under those circumstances.
Guest 11 [01:11:09] And why not? That's because there's some religious ambiguity about what abortion means or what would be the reason.
Guest 9 [01:11:15] Well, I mean, think of it this way. I mean, one reason might be that the Church might change its doctrine on the issue and you'd still have these refund claims. And I think if you go down that route all of a sudden, I mean, in the secular context, the SEC's developed the Safe harbor for forward looking statements.
Guest 9 [01:11:32] And I just hate for this court to have to impose that on religious leaders when they talk to their flock. And that's exactly what this is. This statement 2003 is a forward looking statement. It says no tithing funds will be used for this purpose. Now it turns out that under President and prophet Hinckley's definition, that's exactly what happened. But if that changed for some reason, would that be a basis for somebody to get a refund? Would it be a basis for the courts to be. Even in the hard hypothetical you gave me, you'd still have this problem of the Catholic parishioner coming in and saying, well, I would have never given my money if I knew that was going to happen.
Guest 9 [01:12:11] And then the Church would be saying, well, that's not right. You actually, as an adherent Catholic, you have an obligation, a commandment to give tithing as well. And so there's a jury question over whether or not there was actual or reasonable reliance in this case. I suppose if you were really going to adjudicate this, you could have one side bring in an expert on Catholic Church doctrine, you could have another side bring in an expert on actual practice of Catholics when it came to the collection basket, and then you throw it all to the jury, I think that's a pretty good explanation for why the church autonomy doctrine would apply, even in that hard hypo.
Commingling of Funds and Jurisdictional Questions
Guest 7 [01:12:45] Could I ask you a question about commingling? And I don't know if this is a church's position, but if the funds from tithing went into Ensign's bank account, and then the earnings were accrued in that, and so it's commingled. But if the Church establishes that the earnings themselves far exceeded the investment that would go into the City Creek project, is that the Church's position as to why there's no misstatement? Because even if there's a commingling of the funds, the earnings themselves are more than sufficient to cover the cost of the investment, and therefore, that's why President Hinckley did not misstate anything. Is that the Church's position?
Guest 9 [01:13:33] Well, if those were the facts, I think that would be the Church's position. But the facts are even better for the Church because there was not commingling for accounting purposes. And indeed, after January 1, 2004, the record clearly shows that money was set aside for this project. $1.2 billion was set aside specifically for this project, and then that was always treated separately. There's an account that shows every withdrawal from that account. It shows that that was basically drew down on until March of 2012, where at the end, there was still $151 million in there.
Guest 4 [01:14:15] So.
Guest 9 [01:14:15] And then we have testimony from writing. That's paragraph 15 that I've already alluded to, that says that that $1.2 billion came exclusively from earnings on reserve funds. So under this record, I don't have to. You know, and this is something else that you'd get into if you got to the reliance element. I mean, at a certain point, money is fungible. And so if the Church hadn't been as careful in its accounting, I think I would still be up here saying, like, what are we talking about that, you know, in. In year 2003 alone, the church had earnings on reserve funds that are well in advance on anything they spent on this project. And so there's just no issue that, like, they had to go into tithing.
Guest 7 [01:15:00] Is it your view that the Nielsen declaration does not create a genuine issue? Because even if Ensign used shorthand to say it's all tithing, that doesn't make it so. It's what the Church is saying that is what's important for purposes of this distinction between earnings versus the principle.
Guest 9 [01:15:18] Absolutely. And Judge Smith was alluding to that earlier. But there's Only one person that can speak authoritatively for the church on the meaning of tithing, and that is the President and the prophet Hinckley. And so if other people in the church are using loose language, that is just irrelevant as a legal matter.
Guest 9 [01:15:36] I just have to add though, like, even in a secular setting, I can imagine the same thing, because President Hinckley is being very specific about three buckets. And in that context he describes one of the three buckets as tithing. If somebody else in another context is not differentiating between three buckets and is just talking about one bucket and describes it as tithing. I mean, look, try to find a simple secular example. But there's blueberries and then there are blueberries. Not all berries are the blue or blueberries. And so if somebody's talking about that in one context and they very specifically distinguish between blueberries and black raspberries and blue raspberries, well, then you'd understand it one way.
Guest 9 [01:16:13] And if somebody else is saying, oh, they're all blueberries, like you wouldn't think that was a fraud claim. And at some level that's all that we have here.
Guest 8 [01:16:20] Can you explain why we're carving out embezzlement from the church autonomy doctrine? It seems like it'd be the same interest. Are you saying there's a text in history of, of that or something of that nature?
Guest 9 [01:16:31] So when the courts have come up with something that is that egregiously self dealing and that's really this court's decision in Rasheed, I think what the courts have done, they've maybe call it a cheat, but what they've done is they've said there's a sincerity problem.
Guest 8 [01:16:47] Right.
Guest 9 [01:16:48] And that's the way they sort of
Guest 8 [01:16:49] then carving out embezzlement, though it comes
Guest 9 [01:16:51] to the same thing at the end of the day. And not every court has gone the sincerity route, but that's the way I think the courts have mostly approached that. I also think that the reason maybe they're sort of joined at the hip is at a certain point the reliance question, I think becomes more straightforward. When very few people are actually going to give money to the church if they just think it's going to be embezzled.
Guest 2 [01:17:15] You said you were going to start. I'm sorry, you said you were going to start out by saying there was no misrepresentation here and then go into the church autonomy doctrine. Are you suggesting there, that is a way we can resolve this, is just say there's no misrepresentation and end it there?
Guest 9 [01:17:34] That is A way you could resolve this case and you could say not one word about the religious autonomy doctrine. And I would be happy to win this case for my client on that ground alone.
Guest 6 [01:17:43] Can you talk about the re. Oh, sorry. Go ahead.
Guest 11 [01:17:45] Judge, could I just go back to. So the hypo. I think you said there were two things. So there's the fire, and you've got kids who have no parents, and they say this basket of money is going to go to those kids. Let's get rid of the clothes for the priest and say instead they spend it just on a hurricane somewhere else. Is that a claim?
Guest 9 [01:18:02] I think that's a claim, but because I think that's a distinguishable situation where it's a solicitation for a particular reason. And if those funds are diverted to something else, I think that's a different. I think that's. That's a claim that you could bring. And I don't think not.
Guest 11 [01:18:16] Justin. Embezzlement. It's broader.
Guest 9 [01:18:18] Yeah, right. I took the question to be. In some respects, it's harder to explain the embezzlement exception than it is the specific solicitation diversion. At least I find it harder to explain the embezzlement exemption. But it's there in the cases. And I do think, as I say, you know, whether you call it a little bit of a cheat or you just understand it as a unique situation where there's just no real practical difficulty improving reliance.
Guest 4 [01:18:45] And in this case, there is no allegation, I gather, of a specific request to use tithing for this specific fund. That's the church's position, right?
Guest 9 [01:18:55] That is the church's position. And one of the things that makes this case so extraordinary, of course, is, I mean, we're so far away from these other examples because the church was completely forthright, that it was going to use church money for this particular purpose. And then the president added, I suppose, gratuitously and maybe unfortunately, in hindsight. All right, but I'm going to be clear. There's three buckets of church money that we could use and we're only going to use two buckets. We're not going to use the third bucket for this.
Guest 4 [01:19:23] So in this case, where if the church takes the position, he's the president of the church, the prophet and church members are asked to contribute tithing based on worthiness. They only get to go to the temple. If they do that, they're supposed to get certain blessings. There's never any discussion about how it's going to be used in church doctrine. So if you have that situation, you get back to what was actually said by President Hinckley. You don't have the example that you gave where they said, we'd like you to contribute some money for this, and we're going to use it for this, which is contrary to the normal doctrine. And that answers, I think, my colleague's question. If there's a specific request to use money for X and they don't use it for X, that might be different. But that's not the way tithing is solicited, is it?
Guest 9 [01:20:13] Well, yes, and tithing really isn't solicited in the same way as limited purpose funds are, which is why in describing sort of the meats and bounds of the doctrine, I would describe it as tithing. Refund claims are presumptively covered by the church autonomy doctrine, subject to these two exceptions. And I think that would provide a clear rule, and it would have the incidental benefit of avoiding churches from being in the dilemma that my clients were in, which is they don't want to just rely on an immunity.
Guest 9 [01:20:43] They want to, you know, they've been accused of wrongdoing and they want to defend themselves. But if you make it crystal clear that there's, you know, a broad doctrine with two exceptions, then I think that's much easier for churches in future cases to say, we're going to get rid of these cases at the threshold.
Guest 9 [01:20:59] And it also prevents the opening of floodgates. And Judge Bress asked a question about this as if it were a hypothetical. But since this panel decision, there have been multiple class actions brought against the church. And I don't think it is a problem that is limited to my client. Other churches are here as a meki because they're worried about the same thing. And I think the reason they're worried about it is every church has adherents that then lose their faith. Now, if those adherents, former adherents, came into court and said, well, I want all my money back, because for years I was told I needed to give this money to save my immortal soul.
Guest 9 [01:21:40] And now I've decided all that immortal soul stuff is bunk. There's no afterlife. This is it. I want that money back. I'm going to Vegas. Whatever. If they tried to bring that claim, they would be laughed out of court. According course, you can't bring that kind of fraud claim where you bring in experts and say all this afterlife stuff is bunk. But there's a profound temptation in that circumstance to go back and fly spec all of the sermons and say, oh, well, I was told something about abortion, or I was told something about this City Creek project. And in retrospect, I wouldn't have given my money.
Guest 9 [01:22:13] So I want to do a secular fraud claim instead of the obviously improving proper religious fraud claim. I think there are good reasons to stop that threshold.
Guest 6 [01:22:21] Sorry to interrupt you because I know your time's running short. Can you spend a minute addressing the jurisdictional issue? Because it seems apparent to me that the church's council were aware, and just the way that. That they questioned Mr. Huntsman during his deposition had flagged this issue for themselves. But then it just kind of, like, petered out. Is there a reason for that? Is there a downside to remanding for additional factual findings by the district court before we take up the merits of the case?
Guest 9 [01:22:50] So, I mean, you know, if this court can, you know, instantly reconvene the en banc panel after it sends it back to clarify what I think is true and have no reason to doubt, I mean, I don't really. You know, I barely have standing to object to that. I mean, I think if the consequences of that were that we had to go back to square one or something, you know, I think it was not the best use of this court's resources, I guess. To answer the question, we asked some questions in the deposition. The answers were such that combined with the averments in the complaint, we didn't think we had a basis to question his domicile at the point that he filed the complaint.
Guest 9 [01:23:30] I mean, he alleges he's California resident, which I know there's kind of these competing presumptions. The presumption in favor of. Of the old sort of domicile. But there's also a presumption in favor of residents being the domicile. As my friend on the other side says, you know, we're miles away from a situation where the only new domicile is a hotel room. And then you add to that the fact that there was a specific allegation that there's complete diversity in the citizenships of the parties, which was a separate allegation in the complaint. I think we took all of that, everything we heard in the deposition. We did not think we had a good faith basis to question what is.
Guest 9 [01:24:06] You know, this is. You know, it's a weird situation in a sense, because the question is ultimately, I mean, although, you know, testimony, intent is not dispositive, the legal question is ultimately the intent of the person at the point at which they filed the complaint. And we don't think we have any basis to question that. And I would say maybe this is another reason why the church autonomy doctrine should apply. But, you know, puts a church in a weird position where it has to call its former member a liar at the jurisdictional threshold, which is essentially what we would have had to do if we doubted his averemence and his testimony.
Guest 8 [01:24:41] Counsel, can I ask a question? What are we to do with Watson, which did call it jurisdictional? I know that wasn't a constitutional case, but it does seem relevant to how we look at this now.
Guest 9 [01:24:52] So, you know, the Supreme Court, multiple times since Watson has said that jurisdiction is the term of many meanings, too many meanings. And so I think when you put that more recent observation of the court together with what it said in Hosanna Tabor and what they then subsequently said in Our Lady, I think as a lower court, you do not have to tie yourself to the mast of what the court said in Watson. I think you are free. Looking at the Supreme Court's.
Guest 8 [01:25:21] Although that footnote could also be considered dicta, don't you think?
Guest 9 [01:25:23] What's that?
Guest 8 [01:25:24] That footnote in Hosanna Tabor could be also considered footnote.
Guest 9 [01:25:27] I've read theories that that is dictum. I would, I would. I mean, you know, I would take my chances with saying that's a holding and think that's a safer course than saying we're bound by Watson as the holding. So.
Guest 3 [01:25:38] So council in this case, if we
Kolby Reddish [01:25:40] were to resolve it overall called the
Guest 9 [01:25:41] first ground, which is the non constitutional
Kolby Reddish [01:25:43] ground, that would be solely a question really of California law.
John Dehlin [01:25:47] Correct.
Kolby Reddish [01:25:49] You agree with that?
Guest 9 [01:25:50] I would agree with that.
Guest 3 [01:25:51] So there are a lot of other states in the country, and I'm curious, would there be other states that define
Kolby Reddish [01:25:57] fraud differently that would then in a
Guest 3 [01:26:01] sense bring this case right back to
Kolby Reddish [01:26:02] us if it was brought in Nevada or brought in Idaho or Utah, or do you think that or do you not see a difference?
Guest 9 [01:26:08] I don't see a material difference. I mean, every, you know, there's probably some state out there that has a funky concept of fraud by omission, but I think, you know, you really don't get a fraud claim anywhere without a misrepresentation.
Guest 4 [01:26:20] Does the church have any sense of how many copycat cases were filed against it as a result of the original panel's decision?
Guest 9 [01:26:28] Well, there's been at least half a dozen, but most of those have been styled as putative class actions, and there's sufficient litigation against them that an MDL has been convened. So that's why I say the floodgates concern here is not hypothetical. It is real. And it's all since the panel's decision in this case.
Guest 7 [01:26:45] Are they all California cases or do they vary?
Guest 9 [01:26:49] They're brought in multiple jurisdictions. So let me just like close with one point of context here. I mean, you know, among the problems with this claim is not just that you can't decide it without deciding the definition of tithing, but you can't really decide it without saying that the Supreme Leader, the supreme religious prophet of a religion with 17 million adherents basically committed a massive fraud on his followers when he was speaking ex cathedral. Now, I don't think that proposition alone decides the case for the reasons I alluded to in the exceptions, but it sure contextualizes the case and sure makes clear that the autonomy doctrine should apply. Thank you.
Guest 2 [01:27:27] Thank you very much.
Huntsman's Attorney Delivers Rebuttal
Kolby Reddish [01:27:33] So now Huntsman's attorney will get a chance to use that additional five minutes.
Guest 3 [01:27:38] Your Honors, I'd like to make three brief points on rebuttal. First of all, with respect to Judge Wynn and Judge Smith's question on characterizing the First Amendment as really the fallback argument here. That's precisely right. What's strange about the posture here is that the church put its financials on the table. This is not a situation where the church said, we're called out for our financials. We're not giving them to you because it's First Amendment protected. The church went ahead and put put its financials on the table and characterize them a certain way. And it was only when Mr. Huntsman, again, who inferences must be drawn in favor of, put his own contrary declaration on the table and said no tithing principal funds were in fact used, that all of a sudden the church said, oh, this is a constitutional First Amendment issue up front and center.
▶ Video Clip 3Video Clip 3 [01:28:28] It was after the prior vacated decision recognized the triable issue, so it's patently unfair. We'd submit for the church to put their financials, and then when those financials are questioned, which again, is a secular issue, it's anybody with an accounting degree, any high school student, even an elementary student who takes economics or anything simple math. Let's count up what's in this pile. Let's count up within this pile, and let's see if that's consistent with what we submit as a secular statement by President Hinckley about which pile was used. That's a secular issue that can creates a tribal issue under the summary judgment.
Video Clip 3 [01:29:07] Are you saying commingling is combining the piles? Because the Nielsen talks about commingling. As I Read it. And I'm not sure you have evidence that there really were two piles and they took from both. You just have one pile together, right?
Video Clip 3 [01:29:22] No, your honor, if we look at the actual documents. And again, this is what's strange about the case. The, the church keeps saying the documents show the documents show the documents. Don't even mention the word tithing or tithe. Once the documents are questionable and if the case moves forward, there can be discovery and follow up questions concerning those documents. We thought it was sufficient for the purpose of summary judgment that a sworn testimony of somebody who has percipient knowledge, having worked for the church's financial arm, would at least create a triable issue. But there are numerous follow up questions. Not about the church's business decisions or about how they're conducting things, but simply, these are financials.
Video Clip 3 [01:30:02] Why don't they say tithing? Why don't they differentiate between principal and interest? As the church said, these are accounting issues that you wouldn't need a doctrine expert, you would need a CPA to resolve. And to say that this is a first amendment issue, or even that there's no triable issue of fact at this juncture, when inferences need to be drawn in favor of Mr. Nielsen and not the church and Mr. Writing would be to prematurely decide this case for the wrong reasons. Finally, with respect to Judge Friedland's hypothetical, your hypothetical about you're raising money for orphans and instead you're spending it for something else. And my colleague says no, that case wouldn't be precluded by a decision in the church's favor favor here to the contrary, it would.
Video Clip 3 [01:30:49] Because if it's okay here for the church to say where the money is not going to go and to do it dishonestly, then it's fine for somebody to say where the money will go and to do it dishonestly. It's two sides of the same coin.
Video Clip 3 [01:31:04] Doesn't it? Turn on the baseline obligation. I mean, here the obligation is to pay money as a religious commandment. And these other hypotheticals, it's sort of like a conditional donation. I'm giving this money for this particular purpose. Don't you think there's a distinction between the two?
Video Clip 3 [01:31:20] No, your honor, because the church in this instance set its own condition, sorry, its own secular condition on the money. The church said on five separate occasions the money will not be used, including not one penny of this pile will be used to fund city creek. And Mr. Huntsman relied on that. And if it turns out from the documents that even we one Penny was used. It was a misrepresentation. Not under the First Amendment, not under the 14th Amendment, not under the church autonomy doctrine under California Neutral Council.
Video Clip 3 [01:31:58] On the question of the accounting, my understanding for your to create a dispute of material fact, you're relying completely on the Nielsen declaration. And regarding the seed money for epa, as far as I could tell, the entirety of his declaration was that according to the what senior leadership of EPA informed me in 1997, EPA was born and was seeded with tithing money. Is there anything else in the record, specifically that you're relying on to create a genuine dispute of material fact regarding the source of the ceding money?
Video Clip 3 [01:32:35] Your honor, frankly, it wouldn't be possible for there to be something else in the record at this juncture because there's been no ability, if we remember the posture, this was remarkably ordered to summary judgment a few months into the case at what was supposed to be a conference to discuss a discovery calendar and a trial date. None of that was done. All there was was a single deposition of Mr. Huntsman, and there was a declaration from Mr. Nielsen. And if this case moves forward, which it should, there will be an opportunity to flesh that out. But to say that because the church is able to
Video Clip 3 [01:33:09] put in, again, documents that we submit don't really stand for much other than how the court chooses to characterize them, but we can't then follow up and ask what they actually stand for, consistent with Mr. Nielsen's declaration, again on personal knowledge, as you just read, would be again, to cut the legs of this case off prematurely.
Video Clip 3 [01:33:31] Can I ask why doesn't sincerity fix the problem of Judge Friedland's hypothetical?
Video Clip 3 [01:33:36] It does, your honor. And if we look again at the sincerity doctrine here, which, notably the first time it's been raised, is here at oral argument, the church hasn't had a response to that point in any of its briefs. And that's because the point swings in Mr. Huntsman's favor. The issue of sincerity, again, as was held in Puri and in Rasheed, is if you say, this is a commandment of God, we're going to do it this way. And you knew at the time that you said it, just like in Puri, it wasn't coming from investments that were making money because God blessed them. The money was coming just from other members, other ministers, just like here, the money wasn't.
Video Clip 3 [01:34:19] At the time these statements were made, the money wasn't coming, at Least according to Mr. Nielsen, from earnings on tithing funds. It was coming from principle. So under the sincerity doctrine, President hinckley knew, we submit, at the time that he said it, that what he was representing was not true on behalf of the church. And that falls outside of the sincerity doctrine, because it's not a question of his belief. It's a question of the facts that he was aware of, separate and apart from, from what a doctrine of God may have dictated to him. These were facts. These were secular facts. And your honor, thank you. Yes, thank you.
Video Clip 3 [01:34:59] Thank you very much. Thank you, Mr. Jonellis, and thank you, Mr. Clement, for the oral argument presentations here today.
Video Clip 3 [01:35:06] The.
Video Clip 3 [01:35:07] The case of James Huntsman versus the corporation of the President of the Church of Christ of Latter Day Saints is now submitted and we are adjourned. Thank you.
John Dehlin [01:35:16] All right. All right. And now the justices are filing out of the court. I see 10 justices there, Kolby. Is that, is that what you see?
Kolby Reddish [01:35:30] Eleven.
John Dehlin [01:35:30] Eleven, okay.
Kolby Reddish [01:35:33] Eleven.
Guest 4 [01:35:33] All right.
Kolby Reddish [01:35:34] Well, that was exciting. Fast and furious. Maven asked me to tell everybody that, especially if they're watching this back after we're live streaming. There were a lot of, there were a lot of live comments that I added as the stream was going on, answering people's questions. So please, if you're watching this after, please review the live chat for, for comments and questions there. John, what did you think from a high level?
John Dehlin [01:36:02] I mean, you're the, you're the man. So let's start with you, and then I can share some things too. What do you think?
Post-Argument Analysis and Hot Bench Observations
Kolby Reddish [01:36:07] Yeah, so the first thing I'll start with is, is the. So in legal terms, or kind of in legal parlance, we'll call that what's known as a hot bench. The idea is that neither attorney really got a lot of uninterrupted time.
Kolby Reddish [01:36:21] The convention is that when a judge goes to ask you a question that you stop talking and wait for the judge to get the question out. And oftentimes in response to, you know, your answer, another judge or the same judge may ask a follow up question or a completely different question. It's one of the things, I guess as an attorney who's, I've never argued in front of the ninth Circuit, but having argued and it matters before, I guess I just share with people like how difficult that is, how difficult it is to keep all that stuff in your brain while at the same time fielding these questions.
Kolby Reddish [01:36:49] Sometimes that can be difficult to understand. Legal terminology is difficult to wrap your head around, even when you've been doing it for a long time. And they can ask you a question about a case that may not have been like a big feature of the briefing or an issue that may not have been a feature of the briefing. You heard Mr. Huntsman's attorney reference that right there at the end, saying that, well, this is kind of the first time the sincerity doctrine has come up is that oral argument. And that's the reality of how these cases evolve is it can be really difficult to do that.
Kolby Reddish [01:37:20] I guess one other thing I'd highlight is there were a lot of critical comments to some of the judges questions when Mr. Huntsman's attorney was giving his opening comments. One thing I guess I'd invite people to remember is that it's difficult to read the tea leaves there in that judges will often use, they'll often use a question they're asking the other side that may seem initially like it's confrontational to really just vet a position. So I've given up a long time ago on trying to figure out a judge's position based on the questions that they've asked.
Kolby Reddish [01:37:55] And also I just think that our, the members of our federal judiciary in particular do the respect that, you know, we determine what they decide based on the actual decision that they render and write. And so that was my first takeaway. I thought both of the attorneys did a very good job representing their clients. I thought Huntsman's attorney especially his last five minutes was really, really tight.
Kolby Reddish [01:38:18] He was helping people understand the theory of the case. I think he, he had a few softball questions that were asked his way and a few difficult questions as well that he absolutely knocked out of the park. So I thought he did fantastic. I also thought that the church's attorney did a good job and we'll talk I guess a little bit more in a minute about the kind of like the substance behind the case. But yeah. What were, what were your thoughts or what, what stood out to you as odd or any questions you had?
John Dehlin [01:38:44] So I was, I was just surprised that they weren't letting him give their original speeches that they had prepared. I really wanted to hear Huntsman's attorney just lay out his position. But I'm assuming he would have filed his speech beforehand and they could have read it beforehand. So I guess they didn't want to burn up hearing time having them read something that they could have read beforehand. But I was just, I was just bummed at all the interruptions that that was my first reaction. It, it, do you think that they would have filed their remarks and that the judges would have already read them?
Guest [01:39:19] Yeah.
Kolby Reddish [01:39:19] So the, they don't necessarily file the remarks that they're planning to make that particular day, but the briefing that they referenced a number of times. So those are the written filings that go back and forth. And in this case, they would have been written and filed a long time ago in advance of the original. The original panel decision, if I remember correctly. And so it would have a lot more detail. Typically, those appellate briefs can be anywhere between, you know, 25 and 50 pages, even more than that, depending on the substance of the case. So that's. That's actually really where the majority of the argument happens. Believe it or not. Even though oral arguments are really fun to watch and they can be really spicy to watch and really exciting, the majority of legal work happens in the briefing and in the review of the writing. That's really where the majority of the work happens.
John Dehlin [01:40:05] The next thing that I felt, I just. It felt like there were a couple justices that were clearly on the side of the church. I wish I knew the justices names, but, you know, there was that particularly elderly justice, and then there were a couple that.
John Dehlin [01:40:23] I'll just. I'll just be honest that. That had markers of being more religious people in nature, potentially, that seemed to be asking the toughest questions of. Of Huntsman's attorney. And it just. It just seemed like some of the judges. I know, I know you just said that. You can't really tell, but there was a judge that did look Jewish, and he even made a reference to synagogues.
John Dehlin [01:40:52] And then there was that other justice that would appear to me to look either LDS or very Christian. They just seem to be more conservative justices, potentially religious, that seem to be coming down really hard on Huntsman's attorney. I know I'm wading into dangerous territory, but what did you think about some of those justices that seem to be clearly coming down hard on Huntsman's attorney?
Kolby Reddish [01:41:17] Yeah. So the one judge in particular, his name is Milan Smith Jr. He is a BYU graduate. No.
John Dehlin [01:41:24] So he is Mormon.
Kolby Reddish [01:41:28] Yeah. And I guess I'll just lean. I'm gonna pull the standard attorney dodge and just say that it really just depends on the written decision that comes out. A lot of his. I would agree with you that a lot of his questions seem to be essentially making the church's case for it, but that doesn't necessarily mean that that's his position, even though he is a BYU grad.
John Dehlin [01:41:50] Okay. Yeah. And we appreciate your diplomacy there. It did feel like he burned a lot of the time of Huntsman's attorney kind of badgering Hunts of his attorney. That was my impression.
Kolby Reddish [01:42:06] My other impression I had while he was doing That I do agree with you that he used quite a bit of time going back and forth on to me what seemed like factual questions. And again, this hearing is about the law, right? If there are factual questions, as Huntsman's attorney kept reminding people and as we started today's stream and I reminded people at this stage the law requires that Huntsman is entitled to every favorable inference of fact. And so if there are any unresolved questions of fact, those are be to be determined in Huntsman's favor. And the thing I noticed when it seemed like Judge
Kolby Reddish [01:42:38] Smith was asking a lot of those types of questions is I, I saw, and maybe, maybe it's just because they're focused on other things, but I saw the chief judge who was in the middle there, that we referenced her name and the other judge that was on the, the top of the panel, they looked irritated. But I'm just, I'm just guessing that that's what was going on behind their mind.
John Dehlin [01:42:57] Shouldn't that judge, who's the BYU grad again, Judge Smith, shouldn't he have recused himself from this case because of a conflict of interest judges?
Kolby Reddish [01:43:06] So one of the things about the judicial. So we have canons of judicial ethics and that's been a matter of national news over the course of the past year with regard to behavior at the supreme, at the federal Supreme Court level, Supreme Court of the United States. All I'll say is that for the most part judges ethical duties and considerations are self policed. And so I'm not saying one way or the other whether Judge Smith should or shouldn't have recused himself. It, it is surprising to me that someone would believe that they could be completely a neutral decision maker in a case like that with that affiliation.
Kolby Reddish [01:43:41] But that's a decision for the judge, not my decision. So I'm not commenting on it beyond just saying I personally don't feel like I could like for example, for me if I were a judge someday down the road, I don't feel like I could personally ethically sit on a case involving the LDS Church. In fact, when people have reached out to me about cases involving the LDS Church, even now I don't feel like I have the objective eyes to talk about this stuff except for like this. Right. I wouldn't necessarily actively practice a case like that for that exact reason. But.
John Dehlin [01:44:13] Well, as we look at how currently the US Supreme Court seems to be mired in ethics problems, this idea of justices self policing their ethics feels problematic to me.
Kolby Reddish [01:44:27] I, I completely agree with that. I completely agree that you know, we've got this. It's an old long standing, long standing idea of who watches the watchers. Right. The courts are ultimately our non political branch of government are supposed to be.
John Dehlin [01:44:43] And, but they're clearly, it doesn't seem like they're acting that way. And that judge, for a BYU grad to be so vociferous out of the gate badgering Huntsman's attorney, that just feels conspicuously biased. You know,
Kolby Reddish [01:45:02] the other thing I guess I'd hint at, aside from potential bias, and again, you know, we're not saying one way or the other, but the other thing I'd hint at is that a case is really to be decided on the facts that are in the record. And when you have such an extensive knowledge of facts outside of the record, that can pose its own issue, that doesn't have to do with the question of bias.
John Dehlin [01:45:25] That's a good point. Okay. A big, a big, a big chunk of the early discussion was around the autonomy doctrine about whether it's a violation, I think of the First Amendment if judges are trying to interpret what tithing is and what it isn't. Anything you want to say about autonomy doctrine, First Amendment, who defines tithing, who shouldn't define tithing? And this question of whether judges should be policing how the church does and doesn't define doctrines like tithing.
Kolby Reddish [01:46:01] Yeah. There was one female judge on the panel who was asking a lot of questions that I felt like really got to the heart of the matter. She was asking questions about a church, a potential other hypothetical church. And for people who've never watched an oral argument before, these types of hypotheticals aren't just a huge part of oral arguments, they're a huge part of the legal field as a whole. Like law school is like one three year long, hellacious experience in thinking through all these different hypotheticals. Because that's how we deal with the law is we take a rule, we take a party saying this is the rule that should apply in this case.
Kolby Reddish [01:46:38] Judge. And then we take it to its logical conclusion, sometimes even to the most ridiculous levels, to figure out exactly what they're actually arguing or see the long term effects of that. That's very common in the legal field. And the series of questions that I'm referencing, they were actually of the church's attorney. So this female judge was asking a lot of questions about a church potentially soliciting donations for a specific purpose and then basically going back on that purpose. The church's attorney's response basically was that tithing is a commandment tithing is an inherently religious. The way I was at least understanding his comments is that tithing is an inherently religious thing that would then basically be protected by the First Amendment.
Kolby Reddish [01:47:20] And so to go back to this church autonomy doctrine which we talked about on Monday's stream, the church autonomy doctrine has basically evolved to say that the secular courts cannot question a church's or a religion's religious decisions. And so I can understand why the church is making that argument. I think I tend to take the view that there was no real differentiating factor between the judge's hypotheticals that she was asking about and the facts, at least as Huntsman is entitled to have them interpreted of this case. Because what he's saying is the church has this ongoing solicitation to support its mission through its practice of tithing, whether they view it as a commandment or not.
Kolby Reddish [01:48:00] That's the First Amendment question to me. But what he's saying, and Huntsman's attorney hit this right at the end, too, he said the church added its own conditions with Hinckley's statements. And so that's where he's saying, this is not a First Amendment case. One other reminder I'd give the viewers is that while the church is arguing that this is a First Amendment case, basically that it's barred by the church autonomy doctrine and the First Amendment, none of the four judges, federal judges, who have heard this case previously, have agreed with that position.
John Dehlin [01:48:30] Okay. All right. So there. There were. It was interesting to me that at one point, the attorney for the church gave as a justification for his position that a church could always change its doctrine later. And that's why. That's one reason why judges shouldn't intervene in policing statements by church leaders is because church leaders reserve the right to change doctrine later. Did you find that interesting at all?
Kolby Reddish [01:49:08] I did think that was very. Attorney for the church in that case said something like, well, how can we be expected to know what happened 200 years ago? And I thought, like, don't you represent the organization that claims these things actually happened? It was a similar type of, like, weird argument to me, that particular comment that the church's attorney made.
John Dehlin [01:49:28] I mean, in the real world, of course, both all churches and the Mormon Church changed their doctrine over time. So of course a lawyer is gonna. Is gonna argue in the real world and not try and argue in a silly world where. Where God is the same yesterday, today, and forever. Because clearly, if any God isn't the same yesterday, today, and forever, it's. It's the Mormon God.
Kolby Reddish [01:49:54] Yeah. And from a First Amendment perspective, you know, I definitely would recognize and concede that churches have the right to change their doctrine as they see fit. Now and then, people can make their own decisions on whether they want to stand with that organization or not based on how they. They change and shift. Right, right. But one of the things I think that is a little problematic about what he said is that if we're looking at this case as a typical organization that's asked you for money and you've given money under certain conditions, he's basically saying it's like the Darth Vader thing and Empire Strikes Back.
Kolby Reddish [01:50:26] Right. Like I'm altering the deal. Pray I don't alter it further. Like, that's, that's basically what he's saying, is that the church can't be held to any conditions because its doctrine can change and because tithing is a doctrine. That's. That's where their cases really muddled to me, I couldn't understand where they're. We just didn't defraud people. Case ended and where their First Amendment case began, it felt like. And this comes back again to my comments about the case we heard on Monday. It feels like the church has such an expansive view of the First Amendment that it's really difficult to. It's really difficult to even understand their position.
Who Speaks for the Church and Amicus Briefs
John Dehlin [01:51:06] There was a whole series of threads or discussions around who speaks for the church. It seems like the attorney for the church and a couple of the justices just thought it was obvious that only one single person can speak for the church, and that's the prophet at the time. That feels like a ridiculous argument to me. If you just use the example of a corporation. Corporations. Nobody would argue that only a CEO for a multinational corporation can speak for the corporation. There are literally PR people that speak for corporations, or the corporation can issue statements, or there can be other executives or officers that can speak for the organization. So I just was frustrated. That idea that only a single person, the. The leader could ever speak for the organization. That just seemed really silly to me. What'd you think, Kolby?
Kolby Reddish [01:52:04] I thought that argument was incredibly silly because again, if we go back to the church autonomy doctrine and what we talked about, you know, the general exception from the church autonomy doctrine, if the theory you're suing a church on is a theory that you could sue any other institution on, then the church autonomy doctrine isn't generally isn't applicable, and the First Amendment is implicated. And how you determine who's speaking for an organization, regardless of whether it's a church or Any other organization is just a well settled. I mean, I'm not saying it's not complicated to get to the bottom of it, but we generally know when someone's speaking for an organization, like are they employee of that organization?
Kolby Reddish [01:52:39] Are they speaking at some official function on behalf of the organization? That line of questioning was very weird to me. It seemed like the church's attorney was hoping to get the judges to buy this theory that who could speak for the church is a religious decision. Again, which then implicates the First Amendment. And that to me would be patently ridiculous because that means that a church gets the right, the unquestionable right to determine who speaks for it and who can bind it.
Kolby Reddish [01:53:08] There was one of the judges. I think maybe it was the judge. Smith asked a question. Well, he characterized statements that were made at Ensign Peak as being like some random member. He said something to that effect in the live stream. I commented on it at the time.
Kolby Reddish [01:53:23] And that is just so not even close to the reality here. Like Enzyme Peak. Roger Clark was the president of Enzyme Peak and reported like directly to the First Presidency in the Presiding Bishopric. So to say that was just like some random member. Even like say that was some random bishop that made some statement. I just think that argument is ridiculous. When you're dealing with the statements that we're dealing with, and we'll go through them in just a second was one was made by President Hinckley. One was made by the Presiding Bishop at the time, which the Presiding Bishopric's assignment is literally the physical and financial needs of the church, at least at the time before they did the corporate reorganization.
Kolby Reddish [01:54:02] One was made in Deseret News, the church's own newspaper. One was made by a church PR spokesman at a church organized press conference. And the other was in the Ensign. So to hold out that those aren't like official statements of the church, I think is. Is patently ridiculous.
John Dehlin [01:54:18] Do you want to go to that slide or do you want to just jump to the slides and finish whatever parts you think are really important to discuss?
Kolby Reddish [01:54:26] I do. Because going back to our First Amendment question, if you'll go to the next slide. This is actually just a little interesting tidbit that I found that viewers might find interesting is in significant appellate litigation like this, third parties with some interest in a case can file what's known as amicus curae brief. It's just Latin lawyers use fancy Latin terms all the time so that we can charge you a bunch of money when you have to talk to us. That's literally why we do it. Amicus cure just means friend of the court. And so you can file a motion if you're a third party with sufficient interest and basically say, I want to, hey, court, I want to enter into this as an amicus curie and provide you with a brief and provide you with an argument.
Kolby Reddish [01:55:05] In fact, in Monday's stream, one of the amicus curie was even allowed to argue on behalf of the church. So sometimes in rare cases that could even happen, these arguments often present, you know, that party's position for the court from a public policy perspective or give their perspective on the unsettled question of law that the case is about. And I want to start by saying, like, there's nothing untoward about amicus cure briefs. I've participated as a third party in appeals, and I am in the middle of cases right now that have amicus cure. And there's nothing untoward necessarily about that. But in this particular case, I found this, a particular interesting tidbit.
Kolby Reddish [01:55:40] The church was joined in its position by a bunch of other religious groups and by the Beckett Fund for Religious Liberty. Its brief was filed by its attorney, Eric S. Baxter. The whole idea of this, right, is that, hey, here's this other non. Here's this other interested party that isn't us that's interested in this case. And so sometimes the parties may even reference amicus curate arguments. If you'll go to the next slide, we can talk about this amicus. We can talk about Eric Baxter, because I think this part is very interesting.
Kolby Reddish [01:56:13] So two years ago, the same individual, Eric S. Baxter, was called to be an Area Authority 70 at the 2022 General Conference. And just to make sure that it's the same individual, here is from the church's website on the article when he was called. So you can see right there, Eric Baxter, Senior Counsel, the Becket Fund for Religious Liberty. So I just thought it was funny that, you know, the idea of amicus Curie briefs is here's this additional perspective. But at the same time, you know, this really isn't an additional perspective. This is literally a general authority of the church who filed on behalf of the church's position. And it's worth noting. Oh, sorry, go ahead.
John Dehlin [01:56:54] That's gross. Keep going.
Kolby Reddish [01:56:56] Yeah, it's weird. It's, it's. It's like pretending like you've got a friend that's supporting you, but it's just you again. Right? And so it's also worth noting that the Beckett's position, and it is that the first the Beckett funds position, I'm sorry, is that the First Amendment means that there's simply no line that a religion can cross because any dispute over tithing is an inherently religious claim. And I know that the church's attorney said several times that that wasn't the church's position, but it felt like it was the church's position to me because their position got so muddled between we didn't do it versus you can't even ask us if we did it because we're a religion.
Kolby Reddish [01:57:35] And I guess if I can get on my soapbox for just a minute, one of the reasons I wanted to draw attention to this, because I'm sure Eric Baxter is a great attorney and probably truly believes in the position he took in the brief. So I'm not saying that he did anything untoward by this. I just think it's weird.
Kolby Reddish [01:57:50] But one of the reasons I guess I wanted to talk about this is this is one of the biggest reasons to me that this case matters. This case is about way more than just tithing. It's really about where the First Amendment's limits are.
Kolby Reddish [01:58:03] And, you know, as we've looked over the course of the last year, and we've had a lot of questions about the direction that the country is headed and whether, you know, it should be an explicitly. There are some that take the view that the country should be an explicitly Christian nationalist nation, for example. And those people, those people are likely doing that because they take the same view of the First Amendment that the Becket funds brief filed by Eric Baxter takes. They're taking this view that religions get to define and pick and choose how they participate in society, and that they can be exempt from civil laws that any normal organization would otherwise be accountable for.
Kolby Reddish [01:58:50] And that's one of the things that really bothers me about this case. And it sounds weird because I'm not saying that, you know, the principle doesn't matter. I'm not saying that the money doesn't matter. I know there are so many people that are in such worse off financial positions because of the sacrifices they made to tithing. And I feel like it was insanely unethical for the way the Church dishonored those sacrifices of the widow's mite. But really, to me, the reason I care most about this case, it's not because I'm an ex Mormon. It's not because I'm a lawyer. It's because it really has to do with the fabric of our society and whether the First Amendment means that religions just get to call the shots.
Kolby Reddish [01:59:27] On so many things. I mean, to basically say that we can say whatever we want and we can't defraud you. I just think that is a really difficult position for our society to recover from. Am I soapboxing too much, John?
John Dehlin [01:59:41] That's great. That's. That's important. Thanks for sharing.
Kolby Reddish [01:59:44] Yeah. And I think it's. I think it's why this case matters. And just so people can see. This is the outline of. Yeah. If you'll pull that slide up one more time. This is the outline of the Beckett Fund's argument. Right. From its own brief that I pulled from their own website. Right. So you can see it right there. The church autonomy doctrine bars courts from scrutinizing internal religious decisions. I don't have any problem with that. That's a correct statement of the law. It's the second one that's the problem. Any tithing dispute is inherently religious because tithing itself is inherently religious. And decisions about expending ties inherently involve inspiration and revelation.
Kolby Reddish [02:00:17] And again, to come back to the exchange that one of the female judges had with. With the church's attorney, she was really highlighting this. This element, and I think that's what the. The case will ultimately turn on. Is. Is that question right? There is. Are all tithing disputes inherently religious disputes? I would be very surprised if the Ninth Circuit says there's no limit because of the First Amendment.
John Dehlin [02:00:46] And it seemed like at least one or two of the justices were saying, which I think can be true, probably is mostly true, that when a faithful, devout, orthodox Mormon pays their tithing, they trust the church to do whatever the church wants to do with it. So I think there's some validity to that fact. I do think that most faithful Mormons who pay tithing don't really think about how the church uses the money and would likely say, if asked, the church can do with this whatever they want. What I heard as the. The rebuttal to that is, if the church proactively tells people money is or isn't going to be used in a certain way, and then they violate their own pronouncements, that's when fraud enters the picture. Is that right?
Kolby Reddish [02:01:40] Yeah, that's exactly right. And Huntsman's attorney was actually asked a question about that potential slippery slope. You'll see arguments like this insignificant appellate litigation where one judge or justice might ask, but if we allow your client to do this, doesn't it. Isn't it going to open waves of lawsuits of people bringing claims against disaffected. Sorry, disaffected members Bringing claims against their former churches. And Huntsman's attorney absolutely knocked it out of the park. He explained, like, the slippery slope here is just holding religions to doing what they said they would do. I loved that answer.
John Dehlin [02:02:14] Yeah, yeah. And it looked like there was at least one judge that I think gave. Gave indications that he was Jewish, was basically fearing that synagogues and other Christian churches, etc, would again be faced with a wave of disaffected members who just wanted their money back because they no longer believed and said they would by any means necessary, try to claw back the tithing that they paid. Even if they left for religious reasons, they would try and use any type of justification they could to go gambling in Vegas with the money that they clawed back for. Wasn't it interesting that the church lawyer, as his hypothetical said that the disaffected religious people would go to Vegas to gamble their money away?
Kolby Reddish [02:03:01] Yeah, I thought that was hilarious in the comments. I said, you know, he's characterizing that as the wicked go to Vegas, but the righteous say, let's go shopping.
Guest 5 [02:03:13] I love it.
John Dehlin [02:03:14] All right. Do you want to go to other slides?
Kolby Reddish [02:03:16] I, I think before we go to the other sides, one, one last thing I wanted to do just, just to give people a preview of, like, what's likely to happen. Like I said, the matter's taken under advisement. It'll probably be some months, it may even be next year, before we just see a decision from the panel on this.
Kolby Reddish [02:03:31] The bottom line is that once that decision is made, if it's in Huntsman's favor, the church may appeal that case up to the federal Supreme Court of the United States through a process known as writ of certiori, basically where you ask the court for permission to appeal and whether the court would hear the case is entirely up to the federal scotus or if it's in Huntsman's favor, then it goes back down again to the trial court. It does not mean if Huntsman gets a favorable decision, the church is found guilty of fraud. It means that Huntsman gets the opportunity to offer his case case. And so with that, I thought it'd be fun for us to just go really quickly.
John Dehlin [02:04:06] My, my prediction, once our Supreme Court became 63, kind of super conservative religious protecting as the 6 and, you know, more, more liberal, let's just say secular, representing the three, it made me feel like this case was dead. Because even if, you know, even if the, this circuit court were to rule in favor of Huntsman, certainly the church would appeal. It certainly would go to the US Supreme Court, and they're so transparently conservative and, and religiously motivated that this case would die at the Supreme Court because the Supreme Court and whatever connections Thomas or, or others had with their religious alliances with Oaks, with the religious freedom and all the other conservative religions that would cry foul out of concern for the implications for this case.
John Dehlin [02:05:05] Supreme Court's going to take this case on appeal and defeat it. That's. That's my biggest concern, and that's what I would predict would. Would be the fate of this case. Even if the supreme. Even if the justices ruled in Huntsman's favor. Any, any response to that?
Kolby Reddish [02:05:22] Yeah, I always hate to be a downer and bring up the 6, 3 majority we have at the current SCOTUS. The other thing I guess I'd, I'd highlight. I agree with everything you just said, John, that I don't want to say that I absolutely know what the current makeup of the Supreme Court would do with a case like this because they have surprised me in certain matters. They have also disappointed me in a lot more at the same time. One of the other, I guess, previews I will give people of what we'll likely see is it's just a matter of fact that the 9th Circuit gets reversed by the federal Supreme Court a long time. And that's before they often take some of the more aggressive, what people would call, you know, quote, unquote, liberal positions that sometimes get reversed. So that's another reality.
John Dehlin [02:06:10] You're saying that this 9th Circuit Court is notoriously liberal and that they're frequently overturned by the Supreme Court. Is that what you're saying?
Kolby Reddish [02:06:18] Yeah, that's. That's a reality.
John Dehlin [02:06:19] Okay. All right, that's. That's good to know. Okay. Where. Where were you going next, Kolby?
Reviewing Hinckley's Specific Statements on Tithing
Kolby Reddish [02:06:25] Well, the, the, I guess really what I wanted to do is since we heard so much about these different statements, I thought it would be good to actually go through the statements so that we have a record of the. The five statements that Huntsman alleged were fraudulent. People can make up their own mind, and I'd love to get your thoughts on each and every one of them. So the first one was that hinckley's statement from April 2003. One thing I'd offer, since the church's attorney said, you know, the way he painted it and the way he was talking about this statement is almost like Hinckley said something and then he added a little extra on this statement was made in general conference.
Kolby Reddish [02:07:03] And we just know as a matter of fact, fact that statements made in general Conference, like General Conference addresses are vetted by correlation that they have to go through a translation process that starts weeks, if not months in advance of General Conference. So this idea that he was, like, likely speaking off the cuff, I think is to overuse a phrase I use too much. Patently ridiculous. Like he. This statement would have been vetted. And as far as Hinckley's professional background, as far as I remember, John, he was in media relations. So this is not an unsophisticated person that's making this statement at the time. I think that context is very important, and I think the way the church's attorney attempted to frame it was pretty disingenuous.
Kolby Reddish [02:07:45] But here's. Here's the statement from the April 2003. And this is the portion that the previous panel decision focused on. So this is the portion I pulled. Hinckley said, we feel we have a compelling responsibility to protect the environment of the Salt Lake Temple. The property needs very extensive and expensive renovation. We have felt it imperative to do something to revitalize this area. But I wish to give the entire church the assurance that tithing 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.
Kolby Reddish [02:08:19] These resources, together with the earnings of invested reserve funds, will accommodate this program. And the. The paragraph there, the paragraph break, I want to be really clear that I went to the church's website and pulled their version, because that's where they put the paragraph break. And so this is the biggest statement, I think, which this case turns upon. And I, again, we talked about from a legal perspective, Mr. Huntsman is entitled to every favorable inference of fact here. So I wanted to just kind of talk about how. How you would read this statement, John, because the way I read it is you have Hinckley giving a clear, unequivocal statement.
Kolby Reddish [02:08:59] The tithing funds have not and will not be used to acquire this property. He then mentions funds coming from commercial entities. And then it's this use of the term invested reserve funds that we now know today meant invested reserve tithing funds. And that's. That's where the church's attorney was arguing about these different buckets and saying, like, well, we were really clear about these different buckets. It's worth noting that his statement that it was really clear what Hinckley was talking about. That's only if you kept in mind statements that President hinckley had made 12 and eight years before, where he talked about how the church's finances work.
Kolby Reddish [02:09:42] That talk wasn't. Those earlier talks weren't referenced in Hinckley's 2003 comments. They weren't cited in the General Conference like the printed version of the talk, as far as I'm aware. And so what do you think? Is it reasonable to feel like someone could hear what Hinckley said and walk away with the impression that no tithing, funds, interest or principle would be used to purchase City Creek?
John Dehlin [02:10:08] No, I think it's ridiculous. And I, as a member who was, you know, still faithful at the time the statement was made, there's no way I would have had any knowledge of prior statements. There's no way I could have invoked them to contextualize this statement from Hinckley. When Hinckley made the statement, I took it at face value and I believed it. And it's. It's. It's. It's a disingenuous argument, but I also wonder if it's an effective one. If basically what they're doing is introducing other concepts that then effectively cloud the issue and give justices that want to rule in favor of the church and other religions gives them the room or the justifications that they need to make the ruling that they want to make. So, yes, it's disingenuous. No, it's not realistic. But also, I worry that, yes, it's an effective way to cloud the issue. What do you think?
Kolby Reddish [02:11:07] No, I completely agree with you. I think when we look at the statement, if I'm just looking at the statement and I'm asking myself, do I think President Hinckley had some intent to mislead people? The truth is I do. I think talking, making such a broad, unequivocal statement about how no tithing funds would be used, talking about commercial interests and funds coming from those commercial interests and then talking about invested reserve funds, I think a reasonable person is going to hear or read that statement and think that invested reserve funds, because he was just talking about the church's commercial entities and interests. He's talking about invested reserve funds from the commercial entities and interests, not invested reserve tithing funds.
Kolby Reddish [02:11:49] And that's why I cut that paragraph break the way the Church did. Because normally a paragraph break, and it may seem like I'm getting too semantical and weirdly nerdy with it, but I promise this is how legal cases are made. Like this type of stuff matters. I've had cases that turned upon the placement of a comma. That's literally when you're dealing with legally Operative language, how technical this can get sometimes. And that's where I think the church itself, in the way it's printed. Hinckley statement, and it's still on their website today, having a paragraph break there. I think it conveys that there's a break of information and that.
John Dehlin [02:12:25] Yeah, yeah. And I'll just say Hinckley would never have made the statement if. If he didn't feel like there was rumblings of concern or if he were concerned that members would be concerned about tithing money being used to build a commercial shopping mall. So the fact that he made the statement at all shows that, number one, members wouldn't. He knows Hinckley knew that members would have been concerned or were concerned. And then secondly, the fact that he was so specific in his answer shows his intent, which was to put the members minds at ease, that what they would otherwise have a problem with, they shouldn't be concerned about.
Kolby Reddish [02:13:12] Yeah, that's 100% true. And we know that. Not just because it's reasonable to assume that the sentence right before the sentences that we looked at starts with him saying, now I want to turn some attention to some matter that's received attention in the local press. And that context is very important for people to understand. I even remember as a teenager how many faithful members were asking questions and voicing concerns about this. And so people need to recognize that context, I think, is very important. I also would draw attention to the fact that we're talking about.
Kolby Reddish [02:13:48] We're talking about the church making five statements about this. When was the last time you remember the church making five statements about like some social or contemporary issue ever? Like, think about how it was national news that they made one statement about Tim Ballard or they made two statements about the Arizona Bisbee sex abuse case. For them to make five statements, I think really helps people understand the context that they were trying to reassure members that they weren't using tithing funds. And that's why, even though I know I can't get inside Hinckley's mind, I really do think that he had an intent to mislead people.
Kolby Reddish [02:14:26] I don't think he would have viewed it that way, though. I think people who reach that senior level of leadership in the church think that they think that they're justified in doing things for the church and they really believe that it's for people's ultimate good.
John Dehlin [02:14:39] Oh, yeah, yeah, yeah. The members will get confused. They'll think we're doing something untoward or dishonest. So let's just make a statement that Puts their mind at ease because clearly we're doing ethical things. Clearly, you know, we are. There are technically reserve funds that are going to be used. Okay, maybe we commingle all the funds, but you know, we've made enough interest in our investments to cover this. So whether or not actual tithing got used, you know, clearly, as I think came up in this hearing, just in that year there was enough extra money made that would have covered this. So the members need not worry. You know, we're doing things. Doing things. Right.
Kolby Reddish [02:15:28] Yeah. And we heard very similar arguments even from the church's attorney. Right. Like today they're still making the same argument. So the next statement was a little bit later in October 2003. And again, this was made by the Presiding Bishop at the time. I think it was David H. Burton. I should have had his name there. But the, again, if people don't understand the role of the Presiding Bishop is literally to, to preside over the financial and temporal aspects of the church.
John Dehlin [02:15:55] He's the cfo. He's absolutely the CFO of the church.
Kolby Reddish [02:15:58] Exactly.
John Dehlin [02:15:58] Yeah. And so, yeah, you have to ask yourself if a CFO makes a statement, a public statement at a press conference is, is he qualified to speak for that corporation or not? That's what I would ask people to consider.
Kolby Reddish [02:16:14] Yeah. And I, I think to find that he's not is ridiculous because it was at a church run press conference. He's an employee. He's a full time employee of the church. He's, he's in a role that's literally described in Mormon scripture.
Kolby Reddish [02:16:29] Like that's the role he's serving in his presiding bishop. And his statement in October 2003 is. So he was asked specifically about funding for City Creek and said, none of this money comes from the tithing of our faithful members. This is not how we use tithing funds. And I think it's slightly different than, it's slightly different than Hinckley's statement. It, in some ways it's even less favorable because there's no hedging, there's no mention of this invested reserve funds.
Kolby Reddish [02:16:58] And the use of the language like comes from, I think kind of blows the distinction that the church keeps trying to paint between principle and interest entirely apart. It's much more consistent with the way David Nielsen has said they treated things behind the scenes, that it was all just commingled into one big account. What do you think about that, John?
John Dehlin [02:17:17] I mean, yeah, I think the statement is even more condemning. But again, by introducing this question of who speaks for the Church and basically characterizing it as if any Tom, Dick or Harry low level person just makes some statement to the members, it's not official. Then they go back to its doctrine. It's the doctrine that matters. Only the prophet can determine what's doctrine. And so the prophet is diving as a doctrinal thing, and members, you know, pay based on their belief in the doctrine. I just think they're, they're mounting an effective response for any judge that wants to err on the side of religious freedom and, and you know, First Amendment kind of things, unfortunately.
Kolby Reddish [02:18:05] Yeah. And I, and even though, you know, I have problems with taking the First Amendment way too far, are I actually agree that churches should have the right to control their internal governance, their doctrine, their policies inside their walls? I think that's what makes this case so different is that it went outside of that it got close enough to fraud from a secular point of view that I just don't see how to characterize it as doctrine. But you're right, there are going to be people who fall on a different side of that line. This is one of the reasons that I'm a big fan of fraud. Following this case.
John Dehlin [02:18:37] I did, I did. Like Huntsman's attorney's continued return to the word secular. He, he referenced accounting principles. He even sort of at one point referenced like an elementary school kid could understand one pile versus another pile. Like he really did his best to keep returning the judge's mind to accounting principles, to, you know, math. It's just a question of whether that's, that's gonna hold sway, I guess. But we all know what we think. Should we go to the next statement real quick?
Guest 9 [02:19:14] Yep.
Kolby Reddish [02:19:14] So the next One was in December 2006, printed in the Ensign, which again, to hold this out as not being an official statement of the church, like, then at what point what is.
John Dehlin [02:19:22] It's ridiculous.
Kolby Reddish [02:19:23] Yeah, yeah. Like this was literally something.
John Dehlin [02:19:26] Another example of dishonesty on, on the, on the part of the church's attorney. To say that a Presiding Bishop. Rick, in a public statement. Bishop in a public statement or Ensign, the church's official magazine, to say those statements aren't official. Totally decided. I'll go ahead and read this next statement. It's from, it's from the Ensign, December 2006, and it says, quote, the church first announced three years ago it was planning to redevelop the downtown area to energize the economy of the city that houses its headquarters and to bolster the area near Temple Square. And then here's the statement no tithing funds will be used in the redevelopment. This is Ensign December 2006 and Kolby, let's just see if you're.
Guest [02:20:14] Is it better now?
John Dehlin [02:20:15] It's better now, yeah.
Kolby Reddish [02:20:16] Okay, perfect. I added.
Guest [02:20:18] We went as long as my AirPods will last. So that's.
John Dehlin [02:20:21] That's why you still sound great. You still sound great.
Guest [02:20:23] Okay, perfect.
Guest 3 [02:20:24] Yeah.
Guest [02:20:24] And I have nothing really more to add on this one aside from. Just note that of the three statements
Kolby Reddish [02:20:29] we've looked at so far, it's only
Guest [02:20:31] the first one that has any hedging at all, that has any of this distinction that the church is trying to get people to buy off on. Getting the judges to buy off on.
John Dehlin [02:20:41] These come later, right? These come later. So in some sense you could argue that they overrule the previous statement.
Guest [02:20:47] Exactly, exactly, exactly. Right, John. And I mean there it's just so explicit. No tiding funds will be used in the development, in the redevelopment.
John Dehlin [02:20:56] Yeah.
Guest [02:20:57] Why is it. This is the thing I just wish I could ask. Believing are strongly carrying the church's water on this. What is so wrong with holding them to what they said? They said that they wouldn't use tithing funds in it. They did. That's what David experienced. He literally. We read the quote before the oral arguments. He asked Roger Clark, hey, we represented to people that we weren't going to use tithing funds in this. Why are we using tithing funds in this? And all that Roger Clark basically responded was how important it was to keep this confidential and keep it secret and that people wouldn't be able to find it out.
Guest [02:21:30] Again, I'm not saying that these people are like mustache twirling villains, but that's just a completely different level of ethics, ironically, than the Church taught me. It taught me to be honest. It taught me to do the right thing and let the consequences follow. What is so wrong with holding them to what they said? That's not a violation of religious freedom. It's just holding them to what they said.
John Dehlin [02:21:49] Yeah, I thought it was weird that the judge said, do you have any other evidence other than what Nielsen claims happened at Ensign Peak? And of course the church doesn't share anything. All they did was file a statement, so how could there be any other evidence? And then of course, that's the whole reason for a trial and the whole reason for discovery is to be able to have the church provide the evidence. So it seemed a little weird that the justice was saying, what other evidence do you have? I think it's a miracle that we have the evidence that we do have, thanks to the courage of David Nielsen.
Guest [02:22:26] Yeah. And one of the things I wondered if this is where the judge's mind was going with that question was there's this process in the law known as, like, judicial notice, which is that there's basically some facts that are uncontestable. Right. Like the fact that a certain city is in Idaho. That's just a matter of fact that you don't have to find facts on. A judge can say, yep, I'm gonna just take notice of the fact that that's.
Kolby Reddish [02:22:51] That's reality.
Guest 8 [02:22:52] Right.
Guest [02:22:53] I'm wondering if the judge was attempting to get Huntsman's attorney to reference the SEC order and this church's settlement with the sec, because she was asking specifically about the settlement seed money for Ensign Peak in 1997, if you remember. And that basically has been adjudicated and was admitted by the church in the SEC order. Now, the problem for Huntsman's attorney is that happened after the record for this case would have been settled. And so I'm wondering if she was trying to get him to say, there's nothing else in the record, because we're not at that point of this case yet, but we do know of these additional facts that have basically been adjudicated by a federal administrative agency.
Guest [02:23:32] Again, this is the difficulty with trying to read the tea leaves behind these questions, but that's where my mind started to go, is it's almost uncontestable at this point, on the church's perspective, that the seed money for Ensign Peak came from tithing funds because they've admitted it in a stipulated order where they paid $5 million with this federal regulatory agency.
John Dehlin [02:23:53] Yeah, that's a good point. All right, well, the final statement. I don't think we need to beat a dead horse. The final statement was from Keith McMullen, head of church affiliated Deseret Management, and he used the term, not one penny of tithing goes to the church's for profit endeavors. Specifically, the church has said no tithing went towards City Creek. So I think we've made that point. Those are the statements. Can I ask you a few more questions, Kolby?
Guest [02:24:22] Of course you can.
John Dehlin [02:24:23] Okay. So when the church's attorney got up, he basically said, there's two problems with Huntsman's case. One is that there's no misrepresentation because Hinckley acknowledged the three buckets and publicly stated that the financing would come from two of the buckets, not a third. And then the second one was that the church's autonomy doctrine, you Know, the autonomy doctrine and the First Amendment. You know, just protect the church and let the church do whatever it wants. Anything you want to say about those two arguments other than what we've already said?
Guest [02:25:04] Yeah, I mean, I don't agree with his position, but I actually think the church's attorney is representing the best interest of his client and did a good job of explaining. You know, we just don't feel like we've frauded anyone. If I was representing the church, that's the argument I would want to make.
Kolby Reddish [02:25:18] Make.
Guest [02:25:19] I think the problem I have with that argument, as we've already talked about, is that the only real way that the church has made that argument. And again, I'm not just. I'm not just saying this myself. This is from the panel's first decision in this very case. The only way that that's true is if people had in mind these separate statements that Hinckley made 12 and eight years before that. And I just think expecting people to have tracked so closely something like that is expecting too much. Why shouldn't the onus beyond Hinckley and the church to have just been clear? And again, to come back to one of your recurring talking points, which I completely agree with, John, why is it so problematic to just require the church to have real informed consent, tell people.
Guest [02:26:04] And that's the funny thing is if the church wanted to say, you know, we want to protect. It's one of our religious positions that we want to protect. This downtown Salt Lake area we feel like is justified in using the return on tithing funds. I actually don't think most members would have had a problem, and there wouldn't be any case that exists here. I don't understand where this parade of horribles is coming from at just holding them to what they said.
John Dehlin [02:26:29] So. So what would have needed to be said or not said for the church to not be in the pickle that it's in right now? What would have Hinckley or The Ensign or McMullen or Burton, what should they or should they not have said to. To make this problem go away?
Guest [02:26:46] Well, if, if, if Hinckley, in that 2003 statement, had said, instead of invested reserve funds after just immediately talking about the church's commercial interest if he had said invested reserve tithing funds? I think that there would be absolutely no case here because then it's absolutely clear what he's talking about. But the reality is we didn't know in 2003 that the church was investing reserve tithing funds into Ensign Peak. That was Such a secretive thing that there's like this famous story that even, like when Boyd K. Packer tried to get additional details on. On, and he was acting Quorum, acting President of the Quorum of the twelve, that even he wasn't allowed to get details on Enzyme Peaks, total amount of assets.
Guest [02:27:26] And so that's the problem. Like, that's the reason that Hinckley. In my mind, that's the reason that I feel very confident in saying that Hinckley had some level of intent to deceive people, because we already know he was. Because we already know that the creation of Ensign Peak was hidden from members on purpose. It was right there in that statement from Roger Clark that we read at the beginning of this stream that David Nielsen put into evidence in this matter. And Roger Clark entered a subsequent declaration or affidavit and did not contend that he didn't say that. And ultimately, you know, the facts will have to be determined by a jury. But that, to me, says volumes.
John Dehlin [02:28:06] Yeah, I mean, it seems like what should have been said is, you know, the church brings in tithing. No tithing was used, but we do invest the tithing. And from the. From the earnings off of tithing investments, that money is being used for inside and peak or for. Or for the mall and for beneficial life. And then the only other thing is they would need to have accounting practices that demonstrate that that's how the money is tracked and used and that it was actually tracked and used in that way. The problem is religions don't have to report their finances. They have no financial transparency or disclosure.
John Dehlin [02:28:53] And so they're used to being able to do whatever they want and simply having some dude stand up at general conference once a year and saying, hey, everything is accounted for, all is well. These are not the droids you're looking for. And so I think the church probably just felt like, hey, whatever we do behind the scenes, it's none of your business, because religions are protected. But that's what I think would have had to have happened for this all to be in the up and up.
Guest [02:29:20] No, I completely agree. And they just didn't want to go there. The irony is that and. And this is the, The. The double bind that they were in. Right? They're getting all these questions, they're in the news. They have to assure the members. So that's why they made this statement. And again, that's why I feel so confident in feeling like Hinckley had some level of intent to mislead people.
John Dehlin [02:29:40] I don't think he thought a Thousand percent. He was misleading people.
Guest [02:29:45] Yeah.
John Dehlin [02:29:45] Yeah. He knew better. Hinkley knew better. And he was choosing words that would. That would mislead people 100%. That's true.
Guest 3 [02:29:54] Yeah.
Guest [02:29:55] And for folks that say, I just want to be mean to Hinkley because now I'm an ex Mormon, like, Hinkley was the prophet, like, the first prophet I remember, even though, you know, there were other prophets before that. But by the time I was old enough to really process who a prophet was and get attached to one, Hinckley was the one I was attached to. I still have messages that Hinckley taught and said that I think were great influences on my life. Like, I don't like thinking that this person that helped shape the person I am today had that intent. But at the same time, facts don't care about my feelings.
Guest [02:30:26] And I don't see any other way to reconcile the facts. I really don't. And again, my opinion of how the facts will ultimately resolve or what Hinckley's intent doesn't matter here in the legal proceeding that we just listened to, Mr. Huntsman is entitled to every favorable inference of fact. That means that we can assume bad intent on Hinckley's part, because then he gets a chance to offer that case to the jury. And the church also gets the chance to offer their case to the jury. And you know what? If the case goes back and ultimately goes to trial and the church is found by a jury to have not committed fraud, I'll be the first to report about it and talk about it.
Guest [02:31:02] And because again, this comes back to the distinction we talked about a lot on Monday. What is moral and ethical and what is legal are completely different questions.
John Dehlin [02:31:10] Yeah, please. Like, thank you. Totally true. And yeah, I just want to remind everyone, Please subscribe to this channel. Please like it. And we really appreciate that that helps keep things going. Also, want to thank our donors who donate to MormonStories.org that make all this possible. And any of you who want to become supporters of this content, please become a donor@mormonstories.org really quickly, Kolby, I think it's fair to ask, why did the church ever make any statement? If the church believes what their attorney was saying in today's hearing, which is that the prophet gets to decide what tithing is and members pay tithing as a matter of faith, and they don't care how it's used, then why were those five statements ever made? Isn't that a fair question? If that's how things are, the profit determines and members blindly Pay. Then why were five statements ever made that came up in today's hearing? Correct.
Guest [02:32:10] Yeah. And I think that's why we talked about the context. I wish we would have heard a little bit more about that because that context, I think, is really important to understanding. The church doesn't make five statements over the course of just several years. It looks like they span four. The first four were over four years and then the last one was in 2012.
Guest 4 [02:32:30] But.
Guest [02:32:30] So four statements in four years. Can you think of any social issue that the church has made four public statements about in the past four years? I think that I keep highlighting that because I think it really helps inform the context here. The church was probably getting a lot of pushback from believing members that wanted assurances that their money wasn't going to. That their tithing money wasn't going to a shopping mall. And that's. That turned out to be exactly what happened.
John Dehlin [02:32:58] Yeah. Let me ask you about a couple of the things really quickly, Kolby, and then I'll just ask your predictions on what's going to happen. Did. Was it admitted in today's hearing that the church may have commingled funds? Did you hear that today? Kind of an admission of that.
Guest [02:33:13] Yes. And actually the writing declaration. So Paul Writing is the head of the. Or at least was the head of the church's risk management division. We actually learned a little bit about him last year, if you remember, John, when there was reporting in the Associated Press on Chelsea Goodrich's sex abuse case against the Mormon Church, or at least potential case that she settled with the Mormon Church because Paul Ridding was the attorney involved in that. So Paul Ritting. There were two declarations in this matter filed by the church before. Before it was dismissed. One was by Roger Clark that just vindicated or not vindicated, validated a bunch of documents.
Guest [02:33:47] And the second was by Paul Writing. And Paul Writing affirmed in his declaration that funding for City Creek came exclusively from the invested reserve funds which were originally created with tithing. And so that's the co. I do think the church basically admitted to commingling because that's. That's just how they did things at Enzyme Peak is they just mixed everything into one big bucket.
John Dehlin [02:34:09] Yeah. So I don't know if that will be noticed by the justices or if that will affect their decision, but that's. That's a question that I think I and others have had. Secondly, did. Was that contradicted? Was there a statement that said, we have unrefuted testimony that only interest from reserves went to the Mall, did you hear a. That contradictory statement in today's hearing?
Guest [02:34:35] Well, I think what the church is hinting at there is they've basically tried to break this, you know, create this distinction between tithing donations, which is like when it's coming into the church's coffers, and then the. The. And they're calling that the principle sometimes, and then the interest that they receive or the returns they receive on that ultimate investment. And I think that's actually one of the reasons, if I'm understanding the church's position correctly, I think that's another reason that I really just don't see their distinction that they're trying to create.
Kolby Reddish [02:35:05] Holding a lot of water.
Guest [02:35:07] Because that's basically saying that the. The members. Donations to the church didn't go towards City Creek. Like, the members would obviously know that. Right. If that's the. If that's what they're trying to say tithing meant.
John Dehlin [02:35:21] Yeah. Okay. A couple other things really quickly. Was the statement made at some point the church has not given any misrepresentations on this issue. And if so, you know, I think you've already mentioned this. Is that contradicted by the SEC order?
Guest [02:35:43] I'll think about if it's contradicted by the SEC order for a second. But yes, so that was said. And again, the only way to take that view is if people, when they heard Hinckley's 2003 statement and they heard these other statements, had in mind these separate statements that Hinckley made in both eight years before and 12 years before about how the church manages its finances, or if they had some, you know, they had some insight into that that the rest of us didn't. That's the only. That's the premise of the church saying there was no misrepresentation, is that Hinckley's terms were clear. If you had in mind these other statements, that's what they're trying to say.
Guest [02:36:21] Now, as far as the SEC order goes, I don't know that it directly speaks to the facts that we're talking about here, but I think it definitely changes the tenor of the conversation. Because when, again, when you've got a federal regulatory body like the SEC that imposes a penalty on a church, you just have to know how. How difficult that is from just a political position, from the privileges that religion enjoys under the First Amendment, that is really, really difficult to do. And again, that order was entered into as a stipulation with the church. So I think it does change things how it will factor into this decision is interesting because it came to light after the record was created in this matter. But I would expect it to be a huge game changer if the matter returns and goes back to the trial courts.
Predictions, Attorney Performance, and Final Thoughts
John Dehlin [02:37:14] All right, the last one other thing I'll end with. Before we talk about your predictions, did he suggest that David Nielsen's testimony was not particularly damning?
Guest [02:37:27] He did say that, yeah.
John Dehlin [02:37:29] Any thoughts on that?
Guest [02:37:31] Yeah. And I think what he's saying, he's just begging the question. Right. He's saying, well, if I'm right about everything else, then David Nielsen's testimony is not particularly damning. That's what he's saying is like, if people. If it's reasonable to expect people to have hinckley statements from 12 and eight years prior in mind. When he made that statement, what he said was clear, and it doesn't matter what enzyme peak labeled the funds. Basically, that's what he's trying to say.
John Dehlin [02:37:59] Yeah. All right, well, really quick, Kolby, you've been great on this. Everyone loves your commentary. Oh, quick thoughts on the jurisdictional issue. Anything you wanted to say there about whether. About James Hudson's residency and the concerns the justice has raised about whether he was a Utah resident. It seems like they were saying that on a website, James Huntsman's address was, was or in corporate filings was indicated as being in Utah, not California. Any thoughts on the residency question?
Guest [02:38:32] Yeah, it didn't get as much traction as I thought it would because it's pretty irregular for them to put out a notice like that and ask about it. It happens from time to time. It's just usually not that big of a deal. I don't think the case will be dismissed on those jurisdictional grounds. I think if the court can. Courts often try and take the easy, easy way out and decide on, you know, the non substantive parts. In fact, they're instructed to. There's this doctrine known as the doctrine of constitutional avoidance that actually requires courts to do that, but I don't see that happening. It sounds like from. From all the information that, you know, you knowing James, there was Mark Pugsley in the chat was saying James definitely lived in California at this time. Time that's going to be much more dispositive than some business form that was filed.
John Dehlin [02:39:17] Okay. Yeah. And it seemed like the church's attorney admitted that they didn't think that the residential jurisdictional question was really a problem. Didn't they kind of admit that?
Guest [02:39:30] Yeah, well, what he was admitting was one of the judges was asking him why didn't you, when he was deposed, ask additional questions about this so that we had a better record to understand whether their, the jurisdiction was proper. That's what he was answering. But the fact that there was only one question of it to the church's attorney and one question of it to, to Huntsman's attorney, I, I don't think that's how this case will ultimately resolve. I would be surprised.
John Dehlin [02:39:53] Well, it seemed like the church's attorney got a lot more time than Huntsman's attorney. Was that your impression? And if so, why, why was that?
Guest [02:40:03] So it, it felt like that to me, but that wouldn't have been the scenario. So typically you have 30 minutes for oral argument on each side. And it's important to remember that Huntsman's attorney reserved five minutes of his time to get up on rebuttal. So that's, that's customary so that the, the party who's basically challenging the prior court action always goes first and last if they would like to. And so it probably is more just feeling. I, I think also the church. Even though both attorneys got asked a lot of questions, I did feel like Huntsman's attorney got asked more questions. I didn't count three uninterrupted sentences he got out consecutively. But maybe I'm wrong there. And so I think that probably made us feel like it was moving faster, but the clerk of the court would have been keeping time.
John Dehlin [02:40:48] Did you. Were you able to do a count of how many justices seemed. I know you don't like to do this and you said at the beginning it's too tricky. But if you had to guess a count of how many justices seem to be leaning for the church versus how many justices seem to be leaning for Huntsmen, could you even make a count?
Guest [02:41:12] I really only felt like two of the judges question. All of their questions seemed to indicate that they favored the church's position. There were some that initially when they were questioning Huntsman's attorney, I felt like, oh, that's a tough question for him to answer. But then they turn around and also asked tough questions of the church's attorney. And again, I couldn't get account to answer your question more directly. But again, it's difficult to really even get a feel from the questions they ask because oftentimes. So I worked for an appellate judge and oftentimes he would ask the party that he sided with more going into
Guest [02:41:46] the argument the more difficult questions because he wanted to vet their position and use it to build out distinctions and to head off some of those like Slippery slope arguments. So all to say, it's really difficult to guess where a judge is leaning based on the questions they ask.
John Dehlin [02:42:02] Yeah. My impression was that more judges were against Huntsmen and for the church than were for Huntsmen and against the church. But I agree, it's hard to know.
Guest [02:42:14] Part of that may be, though, that this is a very unprecedented case.
Guest 4 [02:42:17] Case.
Guest [02:42:17] Right, right. Like a case like this is, it's national news for a reason, because it's a very big case for a church to be held to account for tithing fraud. There's a reason that other churches are concerned in taking an interest in this case as amicus. And so all to say, it's not necessarily that they don't favor Huntsman's position, but Huntsman has the tougher battle. I mean, he lost at the district court level. Right. And so he, he is asking ultimately this panel to overturn that district court decision and side with the panel that sided with him the first time around.
John Dehlin [02:42:52] And this is a hot, the implications are so significant. If all of a sudden a major decision impacting all religions across the United States, allowing members to sue for tithing, you know, were to be approved, you know, the implications are significant. So I, I, I could see why there would be a high level of scrutiny, just be, just because the judges would, would, you know, be on the receiving end of some serious grief by a lot of people if they open the floodgates to, to lawsuits and, and U. S. Churches were sued into oblivion by ex members. I want to thank Scott Barrett for his super chat.
John Dehlin [02:43:32] He just said just keep talking. Thanks, Scott. Scott also shared later, I'm beginning to think that the church, the Mormon church, is the ultimate shell corporation, totally unaccountable. And I think, you know, that is a concern that many of us have. Really quickly, Kolby, do you feel, I mean, I wanted to ask you whether you felt like Huntsman's attorney or the church's attorney did a better job not, you know, not which case. How do you want the ruling to be? Not even, you know, how you think the, I guess I want to hear which attorney you think did better for their client. And if you have opinion about, you know, how you think the, the law stands, given the discussions that were made, does that make sense? Can you talk to both of those things?
Guest [02:44:26] Yeah, I can. First, I got distracted because my mom's in the live chat that and it's her birthday tomorrow.
John Dehlin [02:44:33] Who's a reddish?
Guest [02:44:35] That's my mom.
John Dehlin [02:44:36] Oh, hey, A reddish. She should be, she should be applauding you More than applauding me, but. Hi. Hi, Kolby's mom. Thanks for the super chat. And your son's awesome. You must be awesome if you helped raise Kolby. All right.
Guest [02:44:51] Happy birthday tomorrow, Mom.
John Dehlin [02:44:52] Happy birthday, Kolby's mom.
Guest 4 [02:44:55] And go ahead.
John Dehlin [02:44:56] Go ahead, Kolby.
Kolby Reddish [02:44:57] Okay.
Guest [02:44:58] Can you remind me of your question? I'm sorry.
John Dehlin [02:45:00] So first question is based on the law. Where do you see this case as being based on the arguments and responses made who's winning in terms of the law? And then which attorney do you think did better?
Guest [02:45:15] Okay, yeah, perfect. I thought both attorneys did a good job. And it's so difficult for me to set aside my bias because, man, not only do I want the church to get stuck some comeuppance for his behavior, but I also, just as an attorney, really love rooting for the little guy.
Guest [02:45:32] I think Huntsman's attorney did do a better job, and here's why. I think that he, anytime he had a tough question, I think he really stuck to the law. And he was very clear about his message. I felt like the church's message, the church's attorney's message was a lot more muddled and difficult to understand.
Guest [02:45:53] And it's just never fun to have to advance like a technical argument, like, well, you don't even get to ask whether we committed fraud because of the First Amendment. That's not a fun argument to advance or not necessarily a convincing argument to advance. Not as convincing as just like, hey, we didn't do fraud. And I understand he tried to advance both, but they were so muddled that I had difficulty sorting out which was which. To be completely honest, I feel like Huntsman's attorney, especially in that last five minute rebuttal, did an excellent job. It was like really, really clear statements of the law. Really, really clear statements of, of where things are, you know, where he's headed.
Guest [02:46:27] He was able to head off, you know, the parade of horrible slippery slope argument that one of the judges asked him about. As far as who I think is more likely to win on the law, I think it's difficult to say because there's so many different areas that the judges ask questions about that are implicated by the case law on this.
Guest [02:46:46] But I think, again, and I said this in connection with our discussion on the Gaddy case, if any case has a good chance of succeeding, it's this case. And it's because it's so narrowly tailored in scope to those five specific statements and the allegation that the church did exactly what it said it wasn't going to do. I think Again, not to necessarily dodge your question, but I think, again, one of the reasons that this matters is because even if the church wins, even if the church wins in the worst grounds possible, which is the Ninth Circuit or SCOTUS saying the First Amendment means that churches can never be held to account for fraud, the reality of our system, guys, is that that can change.
Guest [02:47:27] That's the genius of the American system. Everything is subject to change. And so I'll come back to the comments I made on Monday, which is if it goes too far, there are corrective mechanisms, but it requires people to get informed and to take action and to demand better from their elected representatives. I think that's where I'll end.
John Dehlin [02:47:49] All right, well, so no. No predictions on how this case is going to. How this case is going to end.
Guest [02:47:55] I can predict that it'll be narrowly divided. I will definitely predict that if Huntsman prevails, that the church will seek rid of certiori. That's textbook what they'll do. I would not be surprised if the Supreme Court of the United States granted certiori in that case. So what I want to happen, John, and maybe this will be my prediction, what I want to happen is for the 9th Circuit, it'll definitely be a divided panel. But what I want to happen is for the church to lose the issue today, and then I want it to go to SCOTUS and we'll see what happens. I don't have a lot of hope that SCOTUS will do the right thing, but again, that's where we can keep people, we can keep our institutions, and we can keep our civic institutions and our elected officials accountable.
Kolby Reddish [02:48:42] Because.
Guest [02:48:43] Because we can. That's the genius of the system. And so even a loss can get us talking about the realities of some of the extensions of what the Church
Kolby Reddish [02:48:51] is arguing, to argue that they can
Guest [02:48:53] just never be held to account for fraud, because that's what the First Amendment means. That can't be the state of the law, guys.
Kolby Reddish [02:48:58] It just can't.
Guest [02:48:59] We'll have to change that because that's dangerous. That's. That's a slip towards theocracy that I just don't think we can stomach.
John Dehlin [02:49:06] Love it. All right.
Guest 7 [02:49:07] Really?
Guest [02:49:08] Can I address this live? Oh, sorry, go ahead.
John Dehlin [02:49:10] Here's a really interesting comment. Scott Gill writes. Can we talk about how Justice Smith is Senator Gordon Smith's brother, who I believe was a senator from Oregon, and that Justice Smith's father was chief of staff for Ezra Tap Benson when Benson was Secretary of Agriculture. And we know that Gordon Smith Senator Gordon Smith was in those Mormon leaked, Mormon leaks, leaked videos where he was basically as a U. S. Senator, meeting in front of the first presidency of the quorum of the twelve, basically telling them that he would do their bidding and, and fight for whatever the church wanted, you know, in, in the U. S. Senate. So that's interesting to know that background on that. Judge Smith.
Guest [02:50:00] I don't know if that's true, but if that's true, that's mind boggling to me that someone who had a brother that made those things.
John Dehlin [02:50:05] Kolby, would Scott Gill lie? That's a joke. I'm joking, I'm joking. I don't know.
Guest [02:50:11] Scott, can I address a comment as well?
Kolby Reddish [02:50:16] Martinez?
John Dehlin [02:50:17] Yeah. Okay, here it is.
Guest 6 [02:50:19] Perfect.
Guest [02:50:20] So I want to address this. Careful, Kolby. It says if everything is subject to change in our American system, then the same could be true for the church and its argument. That's entirely, completely different things, Jess. The constitution literally begins, we the people of these United States. That's the origin of political power in the United States. We get to change it because it is subject to us. We are the government. The government answers to us. There's a difference. The, the church claims that it's a restoration of ancient truth or that it's God's one true truth. That's the difference is anything is subject to change because that's the way our system was designed. That's the ingenious part of the American system that I wish more people would appreciate.
John Dehlin [02:51:00] All right, a couple other final things. Star Beetles Queen asks, did James Huntsman attend this hearing? My understanding is that he did. I don't, I. I can't say that for sure, but that's my understanding. Wick, wicked smart says thank you for the excellent coverage. And Josh Caldwell says, excited Kolby, for your upcoming podcast in the works. Kolby, do you want to promote that really quick? Sure.
Guest [02:51:29] So in the next month or so, my wife and I are going to be launching a. It's going to be a YouTube series dedicated to increasing people's activities, access to case law, understanding the legal system. We're going to call it common law uncommonly explained. And so in the future, look forward to that. Our first episode will actually be on what a common law system is. And the famous 1803 case of Marbury vs Madison, which created the idea of judicial review and basically defined the role of the supreme Court and is still cited at both the federal supreme court level and state court level all the time in determining what the role of the judiciary actually is, is it's one of the reasons I have such an appreciation for the work, the hard work that judges do today.
John Dehlin [02:52:11] Absolutely. All right. Well, Kolby Reddish, thank you so much for joining us today on Mormon Stories. It's always great to have you. You're the best.
Guest [02:52:19] Thanks, John. I appreciate it and I appreciate everything you do. And I'd be remiss if I didn't say, and I've said this on other podcasts before, and I know you always get embarrassed when people say nice things about about you, but you are a great person. You do a lot of important work in this space that people aren't even aware of. And I just like saying that. I'm glad that we've developed this friendship and glad that we got to discuss this today.
John Dehlin [02:52:44] Likewise. Thanks, Kolby. Please come again. Say hi to Cam and hi to your mom and hope you and your mom have a wonderful birthday for her.
Guest 6 [02:52:54] Great.
Guest [02:52:54] Thanks, John.
Closing Thanks and Acknowledgments
John Dehlin [02:52:55] All right, thank you all today for joining us on Mormon Stories. Thanks to Julia and Maven and Gerardo and Brooklyn who all work behind the scenes to make all this possible. Thanks to our donors that make this possible. We couldn't do it without you.
John Dehlin [02:53:08] Thanks to the super chats that were given today. Thanks to all the great comments. Thanks to James Huntsman for his courage to file this case. Thanks to David Nielsen for being a whistleblower. This case wouldn't happen without you two courageous men and friends.
John Dehlin [02:53:25] I, I also want to just remind everyone that we lose donors every every month and if we don't replace those donors with new ones, then we our revenue drops and then we have to drop services. So if you value this type of coverage, if you value this type of content and you want to see it continue, the way to have it continue is to go to MormonStories.org click on the Donate button. Become a monthly donor and we'll keep providing this type of content to you. We love your feedback. You can share it. There's a feedback form at the new redesign MormonStories.org website. You can provide feedback there or you can email us@mormonstoriesmail.com there's also a new application form.
John Dehlin [02:54:07] If you or someone you know or love want to be a guest on Mormon Stories podcast, please go to the application form on MormonStories.org, click on it. Fill out the application. There's so many people we want to interview. People who returned home early from their missions, recently returned missionaries, people who have lost their faith recently, believers who want to tell us how they believe. These days, we're doing stuff on Infertility we're always interested in mixed faith marriages. We're looking for superstar Mormons who lost their faith, former church leaders, blue blood Mormons, anyone who's worked for church headquarters or, you know, ces, any whistleblowers that want to share, and grandparents, people who lost their faith as grandparents.
John Dehlin [02:54:55] Those are some examples of, of the types of people that we want. So if you want to be on the podcast, please fill out an application and we'll end as we always end. Thanks for joining us today. Please be good to each other, be kind to each other.
John Dehlin [02:55:13] We'll follow these developments of these cases as they as they develop. But we'll most importantly, we'll see you all again soon at another episode of Mormon Stories podcast. Take care, everybody.
Transcript © 2026 John P. Dehlin. All rights reserved. Brief quotations are welcome with attribution and a link to mormonstories.org; all other use requires written permission.
Thumbnail Credits: Main image provided by James Huntsman; Image of President Nelson by Rick Bowmer of the Associated Press; Background image of the Salt Lake Temple from Unsplash
One Response
Hello Mormon Stories…
I grew up in the Mormon/LDS church..
I served a mission, giving up years of my life and sacrificing a full ride football scholarship in order to fulfill my obligation to the Mormon church and to satisfy my family…I was the youngest of 6, one of four boys, all my brothers served Missions.
I was made to feel I would be letting down my family, as well as my God if I did not serve a mission….
I spent two years in Southern California, as a salesman/ representative for the church…
I find it interesting that general authorities receive a stipend for full time service that is about 3 times the average national wage, yet full time missionaries have to spend their own money or have to be sponsored while providing the same amount of full time service for two years.
I have struggled for a long time with periods of devoutness to the church and periods of doubt…
Although I do appreciate a lot of core principles that I have learned as a member of the church, I no longer feel that the Church is God’s only path for salvation, and actually feel that all religions are basically man made and don’t necessarily represent divinity or are lead by God