Labor & Employment Law Daily En banc Fifth Circuit affirms panel decision allowing business interference claims to proceed against religious organization
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Friday, December 4, 2020

En banc Fifth Circuit affirms panel decision allowing business interference claims to proceed against religious organization

By Tulay Turan, J.D.

The panel previously found it did not appear certain that resolution of the executive director’s tort claims would require the district court to address purely ecclesiastical questions.

Denying a petition for rehearing en banc, the Fifth Circuit confirmed its prior ruling that it was too early for the district court to determine that the ecclesiastical abstention doctrine would bar it from hearing a case involving tort claims by an executive director against a religious umbrella organization. The dissent argued the suit should be barred because it “falls right in the heartland of the church autonomy doctrine” (McRaney v. North American Mission Board of the Southern Baptist Convention, Inc., November 25, 2020, Higginson, S.).

Refused to accept new agreement. The plaintiff was the former Executive Director of the General Mission Board of the Baptist Convention for Maryland/Delaware (BCMD), one of dozens of separate state conventions that work with the Southern Baptist Convention. The defendant North American Mission Board (NAMB), for which the executive director had never worked, is one of several entities that make up the Southern Baptist Convention.

The NAMB and the BCMD had drafted a Strategic Partnership Agreement (SPA) covering “personnel, cooperation, and funding,” but the executive director declined to accept the new agreement for BCMD. The NAMB worked to oust the executive director from his church leadership position. It advised other BCMD leaders that he had repeatedly refused to meet with NAMB’s president, and it threatened to withhold all funding from BCMD unless it dismissed him and accepted the new SPA. NAMB told BCMD that it intended to terminate the previous SPA agreement “in one year.” After a series of meetings with NAMB, the executive director was terminated.

Prior court proceedings. The executive director filed suit, alleging that NAMB interfered with his contract with BCMD and caused his termination. He also claimed that NAMB lobbied another religious group to disinvite him from speaking at a large mission symposium in Mississippi and that it defamed him and caused him emotional distress by posting a photo of him in its headquarters’ reception area that “communicate[d] he was not to be trusted and [was] public enemy #1.”

The district court dismissed the suit under the First Amendment because his claims would require the court to determine whether NAMB had “valid religious reason[s]” for its actions. A panel of the Fifth Circuit reversed and remanded, holding the district court’s dismissal was premature because it was not certain the resolution of his claims would require the court to interfere with purely ecclesiastical questions.

Petition denied. The Fifth Circuit denied the petition for rehearing en banc. Nine judges voted against rehearing and eight voted in favor. Circuit Judge James Ho issued a dissent, which five judges joined. Circuit Judge Andrew Oldham wrote a separate dissent, which four judges joined.

First dissent. Judge Ho’sdissent argued the appellate court should have affirmed the district court’s dismissal of this suit as barred by the First Amendment. Citing the Supreme Court’s decision in Our Lady of Guadalupe Sch. v. Morrissey-Berru, the dissent noted that “[t]he First Amendment forbids government intrusion in ‘matters of church government.’” There was no way to adjudicate this dispute without violating the church autonomy doctrine. Each of the three actions taken by the religious organizations that the executive director wished to challenge – decisions about whom to place in leadership, whom to host at a religious conference, and whom to exclude from one’s headquarters – is an “internal management decision[] that [is] essential to the institution’s central mission.” Each of these claims involves internal, purely ecclesiastical matters of church governance that federal courts have no business adjudicating, the dissent argued.

Neutral principles of tort law. The dissent also took issue with the panel’s finding that the church autonomy doctrine does not apply here because this suit only requires the court to apply neutral principles of tort law. The dissent indicated the panel misinterpreted the reference to “neutral principles of law” in the Supreme Court’s decision in Jones v. Wolf. The Supreme Court has never extended the neutral principles of law approach beyond the context of church-property disputes.

Valid religious reasons. The dissent also disagreed with the panel’s approach regarding conditioning the application of the church autonomy doctrine on a religious institution’s ability to produce evidence that it had valid religious reasons for its actions. “Secular courts are not competent to determine what constitutes a ‘valid religious reason’—let alone whether a party has produced sufficient evidence of one.”

Moreover, it was already obvious from the face of the complaint that litigating this dispute would invariably require inquiry into NAMB’s valid religious reasons. The executive director himself argued NAMB took action precisely because he refused to accept church policy in “the specific area of starting new churches, including the selection, assessing and training of church planters.” He also admitted in his response to the motion to dismiss that “this cause of action has its roots in Church policy” and “began as a battle of power and authority between two religious organizations.”

“This case is a dispute over a church’s vision for spreading ‘the gospel of Jesus Christ through evangelism and church planting’—a fundamental tenet of faith, not just for the defendant in this suit, but for hundreds of millions of evangelicals around the world. Put simply, this suit puts the church’s evangelism on trial,” the dissent wrote.

Second dissent. Judge Oldham, noting the “jurisdictional line prohibiting civil courts from intruding on ecclesiastical matters is an ancient one,” explained in his dissent that the Supreme Court has held the ecclesiastical-autonomy doctrine carries jurisdictional consequences. In Watson v. Jones, the high court ruled civil courts exercise no jurisdiction over ecclesiastical and religious controversies. Watson remains binding on the Fifth Circuit despite intervening cases causing confusion over the issue. That binding precedent is reason enough to justify rehearing this case en banc, according to Oldham. This case is “rich with questions of exceptional importance,” such as whether ecclesiastical jurisdiction extends to defamation claims. The court’s refusal to grant rehearing “means these questions must wait for another day.”

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