Emphasizing religious liberty, church asks 9th Circuit to review Huntsman lawsuit decision

The Church of Jesus Christ of Latter-day Saints has appealed a court decision to reinstate part of the case of a California businessman who seeks the return of tithing he paid to the church.

In a petition for a rehearing filed Wednesday in the 9th U.S. Circuit Court of Appeals, the church argues that by allowing James Huntsman’s “novel tithing-fraud claim” to proceed, a three-judge panel “ignored clear Supreme Court First Amendment teaching and created a profound threat to religious liberty.”

“Virtually any person who has fallen away from their faith may view their donations to the church during their faithful years as a waste, but that cannot mean each of them has a fraud claim that allows them to try to convince a secular jury that they were swindled. The threat to churches and to the civil courts from such suits is obvious,” church lawyers wrote.

By a 2-1 vote last month, the San Francisco-based court reversed a lower court’s decision to throw out Huntsman’s lawsuit over $5 million in tithing he said he paid the church over a quarter of a century. The church is seeking an en banc review or hearing before the full 9th Circuit.

A U.S. District Court judge granted the church’s motion for summary judgment in September 2021 and dismissed the lawsuit, which alleged the church defrauded its members by using tithing funds for purposes other than charitable purposes. Huntsman’s suit repeated others’ allegations that the church used $1.4 billion in tithing funds to help pay for City Creek Center in downtown Salt Lake City and $594 million in tithing funds to bolster Beneficial Financial Group during the 2008 financial crisis.

Church leaders have maintained that tithing funds are used for religious purposes.

James Huntsman, who lives in California and runs a film distribution company, sued the church in March 2021 in a federal court in Los Angeles, alleging that then-church President Gordon B. Hinckley and other senior Latter-day Saint leaders had misrepresented how tithing donations were spent.

“In fact, tithing was not used on the City Creek project,” a church spokesman said when Huntsman filed the lawsuit. “As President Hinckley said in the April 2003 general conference of the church, the funds came from ‘commercial entities owned by the church’ and the ‘earnings of invested reserve funds.’ A similar statement was made by President Hinckley in the October 2004 general conference.”

James Huntsman resigned his church membership in 2020, a church spokesman said in 2021. Huntsman is the son of the late businessman and church leader Jon Huntsman Sr. and brother of former Utah Gov. and U.S. presidential candidate Jon Huntsman Jr.

In the court filing, church lawyers say virtually every religion depends on contributions from its members and every religion has members who fall away from the faith.

“Under the panel’s decision, any disillusioned former adherent who finds his way to the 9th Circuit can sue for a refund and attempt to get civil authorities to label their former church a liar,” the lawyers wrote. “It is hard to imagine a greater threat to religious liberty or a better reason to grant en banc review.”

Church lawyers argue that if the court allows Huntsman’s claim to move forward, copycat suits by other former believers based on years-old statements will inevitably follow. “And,” they wrote, “the panel’s decision will have a palpable chilling effect on the church’s religious expression.”