MORALS CLAUSE TERMINATIONS

Federal and state anti-discrimination statutes outlawed termination based on race, disability, gender and other protected class circumstances. Denominations and churches were exempted in these statutes, generally, from compliance. Further, the First Amendment doctrines, the Ecclesiastical Abstention Doctrine and Church Autonomy Doctrine, set boundaries on judicial inquiry that have also been applied in employment disputes. The “at will” doctrine prevalent in most states makes it possible for the employer to terminate or the employee to terminate without notice or cause, and without repercussion. Employment contracts need not eviscerate the “at will” doctrine. Such contracts, along with employee handbooks and other documents are important employment dispute documents.

In Butler v St Stanislaus Kostka Catholic Academy, Memorandum & Order (ED NY 2022), the federal trial granted summary judgment to the church on federal employment law claims. The Plaintiff was hired immediately before the start of the school year to teach art literature and social studies at a church school. The Plaintiff represented he attended Catholic schools and had a desire to integrate modern teaching methods with the “Catholic faith.” Plaintiff attended new teacher orientation and after a day of it sent an email to the Principal expressing concern over whether he was likely to be “accepted” because of his sexual orientation and because he expected someday to enter a same sex marriage. The Plaintiff was terminated before the commencement of classes. The job listing required applicants “committed to the mission of Catholic education.” The employment contract required compliance with a “morality clause” and the employee handbook explicitly warned of termination for violation of the morals clause. Both clauses explicitly were based on Catholic doctrine. The federal trial court held the Ministerial Exception applied because the employment contract and handbook required integration of religious teaching and practice into classroom presentations, relying on Hosanna-Tabor Evangelical Lutheran Church & Sch. v. EEOC, 565 US 171, 188 (2012) and Our Lady of Guadalupe Sch. v Morrissey-Berru, 140 SCt 2049, 2055 (2020). The federal trial court held that even if the Ministerial Exception was inapplicable, the Church Autonomy Doctrine foreclosed inquiry into whether the reason given for termination, violation of the morals clauses, was pre-textual because it would require inquiry into the plausibility of the “asserted religious justifications.” While denominations and churches may someday revisit their doctrines regarding some of the issues reported above, and some may have already, the First Amendment prohibits imposition of involuntary reviews by courts and legislatures. To further shield churches, parachurch organizations and church schools, employment contracts, employee handbooks, and job listings should explicitly describe the religious nature of the employment, the religious duties expected of the employee, and imposition of morals clauses generally consistent with church doctrine. Leave no doubt. Follow through.

CHURCH AUTONOMY DOCTRINE

In our reports we often mention the Ecclesiastical Abstention Doctrine. The Doctrine is a subset of the protections afforded by the First Amendment. Essentially, the Doctrine enforces the First Amendment’s prohibition of “law respecting an establishment of religion.” One of the other shorthand expressions of the Doctrine not used as much is the “Church Autonomy Doctrine” (“CAD”). CAD usually arises in cases involving hierarchical churches that internally adjudicate their own internal disputes. Once a hierarchical church has through its own process decided a dispute involving its own members, its own property, and its own personnel, CAD prevents the dispute from being heard in a secular court.

In Catholic Diocese of Jackson v De Lange, Slip Op. (Miss., En Banc, 2022), the state trial court refused to dismiss the case holding the state law employment termination claims of the Plaintiff could be decided by application of secular legal principles. The Mississippi Supreme Court reversed and dismissed the case. The Plaintiff was the Chief Financial Officer of the diocese. The position was enshrined in the formal Canon Law of the denomination. Termination prior to the end of a five-year term had to be based only on “grave cause.” The Plaintiff appealed his termination through the hierarchical system, was placed on administrative leave, but his termination was ultimately implemented. Plaintiff alleged in court the termination was wrongful because the reasons for termination were false, defamatory, and did not constitute “grave cause” as required by Canon Law. The appellate court held that to determine whether the reasons for termination were sufficient “grave causes” would require inquiry into the church doctrine that defined “grave causes” in Canon Law. Such an inquiry would violate the Autonomy Doctrine, the court held.

The Ministerial Exception was not an issue in the reported case because the wrongful termination claim was not based on federal or state anti-discrimination laws. Also, whether a Chief Financial Officer would be considered a “minister” was not a question reached. Thus, the case reported was narrowly focused on the scope of church autonomy in employment matters. In most states, churches will preserve their autonomy in employment matters by documenting carefully that all church employment is “at will” and avoiding employment contracts that might be used to thwart the At Will Doctrine.

CHURCH COPYRIGHTS AND TRADEMARKS

Most of churches have done very little to copyright or trademark their marketing (aka evangelism) symbols. During the pandemic of 2020, with the rise of fully on-line services, copyright and trademarking of a church or pastor’s online persona might have been expected. Few seem to have done so. To do either correctly requires engagement of a qualified attorney. Most church materials are not strictly of commercial value. Such materials have a short “shelf life” and are easily duplicated in forms that do not violate copyrights or trademarks. By the time most churches consider copyrights or trademarks, it is too late for a host of reasons to obtain an enforceable right, usually because the church has spread its materials far and wide without protection and tolerated even close “copycats” much less remotely similar ones.

In Aquarian Foundation v Lowndes, Findings of Fact and Conclusions of Law, Slip Op. (WD Wash. 2022), the federal trial court in a bench trial concluded the claim of the church to protect its copyright and trademark was not enforceable against the Defendant. The church founder copyrighted his own material and owned the copyright. The copyright was of his teaching materials and was transferred in his Will to the church. Many years before his death, the founder gave a written license for use of the materials to the Defendant. The church revoked the license long after the Defendant posted the materials online and used the trademarked name for many years. In order to revoke the license, the church had to give two years notice but attempted to make the revocation immediate. At trial the church could not prove loss of revenue from the alleged infringements. At trial the church tried to present testimony of a handwriting expert to prove the license given to Defendant was a forgery. However, the methodology used by the expert, use of exemplars that could not be proven to be authentic, was rejected by the Court.

Copyrighting and trademarking intellectual property is not easily done. Infringement enforcement may take years and may be subject to setoffs and adjustments. See e.g., Bright Tunes Music Corp. v Harrisongs Music, Ltd., 420 F. Supp. 177 (S.D.N.Y.1976) (“My Sweet Lord,” George Harrison, former Beatle); ABKCO Music, Inc. v Harrisongs Music, 508 F. Supp. 798 (SDNY 1981) (“$587,000” after adjustments). Church intellectual property has a very limited shelf life and is easily replicated without obvious duplication. Much church intellectual property is fair game for “fair use.” 17 USC §107.

NON-PROFIT CORPORATION STATUTES

One of the sources of Neutral Principles of Law which can be applied to resolve church disputes that spill into the street, including church governance disputes, is the state statute governing non-profit corporations in the state in which the church corporation was formed. Typically, the statute comes into a church governance dispute when the church organizational documents do not resolve a governance issue. Because most churches using common sense incorporate and do so with modern organizational documents periodically updated, such statutes do not often decide governance issues.

In Church in Bloomfield v Park, Slip Op. (Mich. App. 2022), the church was incorporated for many years. But, after incorporating, the church never adopted any bylaws. The Articles of Incorporation did not specify the means by which officers were elected or the terms to which they were elected. For a period of time, the church allegedly did not hold a properly noticed annual meeting or an election of officers. The church bought a residence property and sought to have the property rezoned so that worship services could be held in the residence. The rezoning was not successful so the church, or some faction, sought to sell he property. Another faction allegedly resisted. A faction sought a court order compelling a properly noticed annual meeting as required by the state non-profit corporations statute. The trial court compelled the meeting because the church organizational documents did not specify any method of electing officers. The appellate court affirmed. The appellate court held that the enforcement of the non-profit corporations statute upon church governance not otherwise specified in the church organizational documents was not an ecclesiastic matter. The Ecclesiastical Abstention Doctrine did not deprive the court of jurisdiction or limit the court’s ability to order compliance with the state corporations statute.

The church did not have to incorporate, even though for many reasons that is a good practice. Once the church incorporated, it was free to adopt governance documents like bylaws and set its own procedures. Once the church incorporated, it became subject to state corporation statutes that apply in the vacuum of organizational governance documents. Churches that fail to complete effective organizational governance documents and then maintain them over time are subject to chaos, disorder and usurpation. Oh, yes, and legal fees.