This question has persisted without agreement within Scientology criticdom for years, largely because it’s impossible to answer without defining religion either so amorphously as to strip the word of all meaning, or so exclusively as to omit many widely recognized religions. Still, the question matters if for no other reason than the fact that it keeps getting asked, usually in the context of the more interesting question about why Scientology is considered a tax exempt entity.

Briefly to that end, it’s important to realize that the two entities with seemingly the most interest in determining whether Scientology is a religion–the US courts and the IRS–are constrained by the establishment clause to define religion so expansively as to avoid implicitly endorsing religion X over religion Y.

In a country as religiously pluralistic as the US, the courts must hew to a broad and inclusive definition of religion.

Early court decisions attempting to define religion predictably chose monotheistic terms–”The term ‘religion’ has reference to one’s views of his relations to his Creator[.]” Davis v. Beason, 133 U.S. 333 (1890). “[T]he essence of religion is belief in a relation to God involving duties superior to those arising from any human relation.” US v. MacIntosh, 283 U.S. 605, 633-34 (1931) (Hughes, C.J., dissenting).

Soon after, in 1944, God disappears from the definition:  “[F]reedom of religious belief … embraces the right to maintain theories of life and of death and of the hereafter which are rank heresy to followers of the orthodox faiths.”  Ballard v. US, 322 U.S. 78 (1944).

In US v. Seeger, 380 U.S. 163 (1965), the Supreme Court interpreted legislation exempting conscientious objectors from war (here, the Vietnam War) as including beliefs which even the plaintiff had not initially described as religious. The statute defined religion as “an individual’s belief in a relation to a Supreme Being involving duties superior to those arising from any human relation, but does not include essentially political, sociological or philosophical views or a merely personal moral code.” The court read this to include “all sincere religious beliefs which are based upon a power or being, or upon a faith, to which all else is subordinate or upon which all else is ultimately dependent.”

The Supreme Court has thus kept pace with modern theological trends by stretching the definition of religion to essentially mean any structured belief system which sincerely based on “ultimate concerns.” US v. Seeger, referencing progressive theologian Paul Tillich, Dynamics of Faith (1957) (defining faith as “the state of being ultimately concerned”). See also Welsh v. U.S., 398 U.S. 333 (1970).

Which brings us to Scientology, which is also unconcerned with any Supreme Being but instead, similar to inward-looking Eastern religions, views the soul, or what Scientology founder L Ron Hubbard called the “thetan,” as an immortal being. Per Hubbard, an adherent’s spiritual growth is wholly tied to gaining an increased understanding of one’s thetan, which is accomplished through a series of exercises and courses, often in tandem with another Scientologist called an “auditor” and often with the aid of an electropsychometer (“e-meter”), a sort of lie detector employed by the auditor in these courses.

By the Supreme Court’s increasingly generous definition of religion, broadened to keep pace with a growing pluralistic populace and to comport with the first amendment, it’s difficult to argue that Scientology, as I describe it above, is not a religion.

That said, the relevant question the IRS asks in determining an entity’s tax exempt status isn’t whether the entity is a “religion” but rather whether it’s organized and operated for a “religious purpose.” This distinction is not merely semantic. Though it rarely happens, the IRS can both recognize an entity as a religion and yet still deny it tax exempt status. See Bob Jones University v. US, 416 U.S. 725 (1974) (Court revoked exempt status of religious university which denied admission to applicants engaged in an interracial marriage or dating).

Despite that its tenets easily qualify as “religious” per the US constitution, there are nevertheless countless arguments why Scientology and its myriad corporate fronts should be denied tax exempt status because it is not organized and maintained for a “religious purpose.” 26 U.S.C. § 501(c)(3).

Religious groups risk losing their tax exempt status in a number of ways, such as if its net earnings inure to an individual; if it provides a substantial benefit to a private interest; if it devotes a substantial part of its activities attempting to influence legislation; if it participates or intervenes in any political campaign on behalf or in opposition to a candidate for public office; or if its purposes and activities are illegal or “violate fundamental public policy.” IRS Guidelines, Activities that are Illegal or Contrary to Public Policy.

An easier way to understand this is that the government cannot regulate belief, which is why it must define religion so broadly, but it can regulate activity, i.e., determine the existence of a “religious purpose.”

The most common reason a religion is denied or loses its tax exempt status is where its funding inures to an individual or individuals as opposed to the organization. LAW. This was the basis, in fact, upon which Scientology was first denied exempt status, when it emerged in the course of a trial that L Ron Hubbard was personally enriched by the organization. Founding Church of Scientology v. US, 188 Ct. Cl. 490 (Ct. Cl. 1969) (Court found impermissible a personal compensation scheme whereby the Church of Scientology had personally compensated L Ron Hubbard and his family at least 10% of its gross income).

By 1986, when L Ron Hubbard died, his religion was still not recognized by the IRS as exempt. Seven years later (1993) Hubbard’s successor, David Miscavige, negotiated a deal with the IRS granting it exempt status in exchange for Scientology dropping hundreds of lawsuits it had filed against the organization. Its terms remain officially secret to this day (the most recent unsuccessful attempt to crack it came in Sklars ) but were nevertheless leaked to the Wall Street Journal in 1997.

The IRS originally held the view that Scientology was not organized for a “religious purpose” but then reversed itself without explanation. What changed? By most accounts, the organization has only gotten more sinister under Miscavige, who is widely reported to violently beat subordinates, and live in unmatched luxury while staff members can make as little as $50/week.

But let’s break down why Scientology in its present incarnation isn’t “organized for a religious purpose,” and why, accordingly, it should have it exempt status rescinded: (1) Scientology has an explicitly commercial, non-charitable nature; (2) its revenues inure to a single individual; (3) it forces many of its members to disconnect from their families; (4) it grossly mistreats many of its members; and (5) it harasses and attacks ex-members and critics.

Taking these in turn then…

(1)

Regardless of Scientology’s thetan-concerned religious content, it seems significant that Scientology charges exorbitant amounts to become progressively enlightened. The functional practice more closely resembles psychotherapy, where one pays as one goes, than the community-oriented tithing and donation structure found with most other religions. Scientology attempts to dance around this by labeling all quid pro quo course payments as “donations.” From a business perspective, Scientology is profoundly profitable–staff members are paid a fraction of the federal minimum wage, while parishioners pay hundreds of thousands of dollars for the privilege of being audited.
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Scientology routinely resorts to high-pressure sales tactics to sell courses and solicit donations to various projects, often resulting in the financial ruin of its members. It even exhorts its members to pressure other members if they’re deemed to not be going “up the bridge” quickly enough. Though many religious groups can be financially demanding of their parishioners, among tax exempt religions I have yet to see any group comparable to Scientology. It routinely bankrupts members and declares them suppressive (excommunicates them) if and when they protest.

One high-ranking ex-Scientology official, Debbie Cook, recently estimated that Scientology has $1 billion dollars in reserve. Of that, virtually none goes to any form of social betterment or benefits local communities in any way. Scientology maintains a handful of social betterment groups (Narconon, Criminon, Applied Scholastics, and The Way to Happiness), each which are either run for-profit ventures or exist solely to “safepoint” (create generally good public relations) for L Ron Hubbard and/or Scientology. Narconon (a drug rehabilitation organization utilizing L Ron Hubbard’s scientifically disproven theories regarding toxins) is not only expensive, but is implicated in a trail of ‘patient’ deaths. Narconon Georgia is under state investigation for a massive insurance fraud scheme.

In short, parishioners pay hundreds of thousands of dollars to become Scientologists, money which benefits those parishioners directly; Scientology benefits by not having to pay taxes on those profits; and the general community benefits in no way whatsoever.

(2)

In Foundation Church, supra, the court found that Scientology revenues directly benefited L Ron Hubbard and that the IRS was therefore justified in denying Scientology tax exempt status for failing to organize and maintain a religious purpose. Hubbard’s successor, David Miscavige, has been, if anything, worse in this regard, his personal possessions are a laundry list of obscene wealth: $5,000 tailored suits, $500 Egyptian cotton shirts, the finest Italian leather shoes, personal use of a private jet, a $50,000 Acura RL, a $25,000 Mazda Miata, an $80,000 Range Rover, an $150,000 bulletproof GMC Van, a $25,000 custom-made motorcycle, a $110,000 BMW M6, a $45,000 Acura to use then he’s in Clearwater, Florida, a personal chef, a personal stylist, and so on. Even on Miscavige’s self-granted six-figure salary, the aforementioned perks could not be accounted for without assuming that he’s personally benefiting from Scientology revenues.

The inurement question gets even more lurid when considering how Miscavige’s best friend, Tom Cruise, also has personally benefited from labor performed by Scientology staff members. For example, Cruise’s elaborate wedding to Nicole Kidman was staffed by Scientology members at no cost to Cruise. Miscavige’s wedding gift to the couple was to arrange for a team of twenty Sea Org disciples to dig, hoe, and plant wheat grass and wildflower seed near the Cruises’ bungalow (on Scientology grounds) after Miscavige had learned of the couple’s fantasy of running through a meadow of wildflowers together. Miscavige threw a birthday party for Cruise aboard its cruise ship The Freewinds, estimated to cost $300,000. And Miscavige bestowed countless gifts worth hundreds of thousands of dollars on Cruise, often necessitating cheap, uncompensated Sea Org/staff labor. Cruise, through his lawyers, has issued a blanket denial but such denials are outweighed by numerous corroborated accounts. See generally Andrew Morton, Tom Cruise: An Unauthorized Biography (St. Martin’s Press, 2008).

Inurement is probably the most common basis upon which religious entities lose their tax exempt status. If the IRS cared to look, they’d have little trouble spotting Miscavige and Cruise personally benefiting from Scientology revenues in ways which have no discernible religious connection whatsoever.

(3)

The term “cult,” like “religion,” is, on the one hand, a useful demarcation line for how most people approach the question of whether Scientology is a religion. Religions are good and cults are bad, but why that’s the case is a somewhat subjective matter, similar to how the question of what is and isn’t a religion is difficult because of how everyone perceives religion personally, first, rather than dryly and objectively. My religion is a religion because I’m “good” and cults are “bad,” semantically speaking.

Nevertheless, one commonality of cults and continued evidence of their malignancy is that they tend to break up families, which most agree is an effect detrimental to communities in general. Scientology has alternately denied and defended (and indeed even claimed it as a human right) its well-documented practice of “disconnection,” whereby a member is forced by the organization to disengage from all communication with anyone critical of Scientology (inevitably the most skeptical family member). Scientology even designates a term for these pests: Suppressive Persons (or “SPs”), and a member risks his/her own standing within Scientology if they are “PTS” (Potential Trouble Source) to an SP.

Family represents an important value in America, but so does the principle of autonomy, and there is friction between the two. There is no recognized legal right or obligation for of-age family members to communicate with each other. Nor do we want to set precedents whereby churches’ institutional and its individuals’ autonomy is threatened by government policies. Scientology would argue that to rescind its tax exempt status because its practices break up families would be to religious. There’s some merit to this argument. The more powerful counterargument is simply that taxpayers should not be forced to effectively subsidize the destruction of families.

(4) & (5)

Scientology routinely mistreats its members, and especially its staff members. Ex-Sea Org members have filed lawsuits for labor law violations, forced imprisonment, human trafficking, and forced abortions. These damning accounts are largely corroborated, yet Scientology manages to escape prosecution and liability because the ex-members in question were either deemed to have consented or were deemed “ministers” and thus fell under the “ministerial exception,” which allows religious groups to be exempt from ordinary labor laws. Even if we concede that Sea Org members, after expressing their informed consent, thus waiving most claims they might later bring, it remains true that minors cannot waive such rights. Yet Scientology continues to employ children as Sea Org members (L Ron Hubbard viewed, and thus Scientology views children as undeveloped adults) and continues to abuse them without repercussion.

Scientology also infamously mistreats ex-members who dare criticize it, a group that includes not only former Scientologists but journalists and non-ex-member critics. The Internet is replete with endless stories of Scientology’s aggressive handling of individuals it deems threats, so I won’t bother detailing them here. But to the extent Scientology’s harassment engine is kept afloat and churning by a boundless tax-exempt repository (specifically, the International Association of Scientologists, or “IAS”), yet another basis exists to rescind Scientology’s tax-exempt status for failing to maintain a religious purpose.

In sum, in the United States the question of Scientology’s religiosity is a useless academic exercise because the first amendment has constrained courts (and thus the IRS) to define religion so broadly inclusive as to be meaningless. By the broadest definition, Scientology’s core beliefs easily qualify as religious. However, by the IRS’s more stringent requirement that tax-exempt entities be organized and maintained for a  religious purpose, Scientology fails because its revenues inure to a single individual, leader David Miscavige, its operation is indistinguishable from a for-profit business enterprise, and its practices–disconnection, the abuse of of members, and the ruthless handling of critics–violate public policy.

The defendant, Hosanna-Tabor Evangelical Lutheran Church and School, was the employer of 4th grade teacher and plaintiff Cheyrl Perich from Minnesota, who fell ill with a mystery ailment in June 2004, and had to be hospitalized for several months. Six months later doctors finally diagnosed Perich with narcolepsy and advised her that with proper medication she’d be able to return to work in 2-3 months. The principal and the school board, however, became concerned about Perich’s ability to fully function and requested that she agree to a “peaceful release” whereby the school would cover Perich’s medical insurance premiums through December 2005 (and effectively waive disability). Perich rejected the release proposal and attempted to return to work (she had obtained a work release from her doctor), and was instead fired, purportedly due to her “insubordination” at the board meeting where she rejected the school’s proposal, and due to her threat to sue (which, yes, appears to be something of a tautology).

Perich filed a complaint via the EEOC against Hosanna-Tabor for wrongful termination and under the Americans with Disability Act (“ADA”) and retaliation. She ultimately joined in the complaint herself, becoming a co-plaintiff with the EEOC. After both sides filed for summary judgment, the district court found for Hosanna-Tabor, ruling that the ministerial exception precluded the court from inquiring into her claims and accordingly dismissed the claim for lack of subject matter jurisdiction. After moving to reconsider (which motion was denied), Perich and the EEOC appealed to the 11th Circuit.

In all ministerial exception cases the issue ultimately boils down to a consideration of the relationship between the employer religious entity and the employer—basically: Is the employee a “minister”? If the answer is “yes,” the employer is exempt from virtually all labor law provisions. The rationale for the ministerial exception is that the constitution prohibits court inquiry into the hiring and firing decisions of religion, lest the courts become impermissibly entangled in religious affairs. Similarly, to penalize a religious institution based on hiring and firing decisions grounded in religious criteria violates that religious entity’s free exercise rights.

In deciding whether an employee is a “minister” or “ministerial employee,” the courts have taken a myriad of approaches, most under the guise of what’s been called the “primary duties” test. At the most restrictive end of the test spectrum is the 6th Circuit’s approach in Hosanna-Tabor. Perich did teach some religious classes but she primarily administered a secular curriculum—the Court at one point literally counts the hours in a typical day for Perich, noting that more than six of her seven hour day was spent teaching secular subjects.  Moreover, both the majority and concurrence found persuasive the fact that some Hosanna-Tabor teachers were not even Lutheran yet still gave religious instruction—how can non-adherents possibly be ministers? Additionally, it didn’t hurt that Hosanna-Tabor’s personnel manual includes EEOC policy within, and that the Governing Manual for Lutheran Schools apparently contemplates that teachers are protected by labor laws.

At the opposite end of the primary duties spectrum is a highly deferential test that asks whether some of the employee’s duties are religious in nature and whether the employer based its hiring decision on religious criteria. The 5th and 9th Circuits’ adopt this approach, as typified by the Alcazar v. Corporation of the Catholic Archbishop of Seattle case, upon which basis the Headleys’ cases were dismissed. With Alcazar, the question of duties is mostly subsumed by flipping it around and looking not at what the employee does, but the intent of the employer—why the employee was hired. By eschewing objectivity, Alcazar (decided en banc) hands to religious entities a highly valuable get-out-of-labor-law-free card, by including their hiring decisions—which courts cannot question lest they become entangled in religious affairs—as a part of the test. “Yes, we hired that janitor to deliver the Word of God—why should the state have any say in the matter?” Perhaps this is extreme (a janitor likely performs no religious functions much less some), but it’s a helpful example to point out the tautological nature of the “religious criteria” prong.

The ridiculousness of Alcazar was made apparent in the Headleys suits, which were dismissed when the court analyzed their situations as follows:

 She worked for Defendants, which both are institutions within the Church. She also was able to hold the positions she had with Defendants based largely on religious criteria, namely her commitment to 1,000,000,000 years of service to Scientology and the lifestyle constraints that come with being a member of the Sea Org. See id. 2010 WL 917200, (deciding this factor was met where plaintiff was in a job available only to seminarians of the Catholic Church). Finally, as part of her duties, she performed various religious duties and responsibilities, most notably “auditing” and “cramming.”

In other words, Claire Headley was a minister because Scientology said so. The court declined to entertain what Claire or Marc Headley actually did in terms of work while in the Sea Org, 99% of which could have been performed by non-Scientologists without a hitch, because it had already found that “some” of their duties were Scientological in nature.

If the Supreme Court affirms Hosanna-Tabor (or even if it merely concurs with the result and creates a new test based on the facts (perhaps adopting Judge Helen White’s concurrence, which appears to have kept the “primary” part of the primary duties test, but also looked to whether the employee’s hiring relied upon a religious criteria) it may be necessary for the courts to reexamine the Headleys’ cases based on whatever standard the Supreme Court sets forth, and the result could be quite favorable.

If the Supreme Court were to simply affirm without comment (for the sake of argument–this won’t happen), the question in the Headleys’ cases would become how much time they spent performing secular duties and how much time they spent performing religious duties. And even if the court ultimately agreed with Scientology that every minute of a Sea Org member’s waking day is spent performing religious duties as a member of a religious order, the factual inquiry would nevertheless be fascinating… for critics anyway–Scientology would certainly be terrified to have its treatment of Sea Org members subject to the court’s scrutiny.

Beyond the Scientology implications I’ve mentioned, this case has some pretty heavy real world implications as well, as can be inferred from the huge number of amicus briefs already filed (20 in support of Hosanna-Tabor, 8 in support of the EEOC/Perich). Scotusblog entry for Hosanna-Tabor case here. There are tens of thousands of teachers teaching at parochial and sectarian schools who will be directly affected by the how the Supreme Court winds up ruling.; and my guess is that the vast majority of those teachers are under the perhaps mistaken impression that they’re protected by labor law.

Also worth noting is this 2008 Student Note in appearing in the Harvard Law Review arguing for the more deferential “primary duties” standard–though I disagree with the Note’s thesis, it’s an excellent walk through the most prominent case law (as of 2008 at least, unfortunately prior to Alcazar).

Finally, journalist Jonny Jacobson wrote an excellent post covering similar territory as this one but with a different focus. His post prompted mine, so I just wanted to give it a shout-out.

At age 9, Laura began working for the Church of Scientology’s Sea Org in the most miserable conditions imaginable in a non-third world country. At age 16 she married a fellow Scientologist staff member and soon became pregnant. Scientology forced her to abort her child–Sea Org workers with children aren’t nearly as productive and, accordingly, having them is forbidden.

Laura endured many more years of abuse within the Sea Org, spending long stretches of time on the Rehabilitation Project Force (Scientology’s brand of prison camp). In 2004, at the age of 25, she had finally had enough. Knowing that the quickest way out was to be seen as visibly suicidal, which would cause Scientology to “offload her,” she ingested bleach in view of another Sea Org worker. Laura calculated correctly–her Sea Org days were immediately over (although she remained financially on the hook–Scientology charged her $120,000 for her “job training”–and she remained a Scientologist until 2008). Her husband remained–and remains–in the Sea Org. Before leaving Laura was required to sign numerous documents releasing Scientology from liability on any number of fronts.

Laura tells her story here in a St. Pete Times produced video which was part of its extensive 2009-2010 series on Scientology, The Truth Rundown.

Jonny Jacobson provides a more thorough summary on Laura’s backstory here.

As noted above, in 2009 Laura sued the Church of Scientology in California state court on a variety of bases. (Her second amended complaint can be read here.) Scientology removed the case to federal court and moved to dismiss, arguing that the claims were time-barred. The federal court–reasoning that Laura’s claims had accrued in 2004 and each had a statute of limitations of four years, meaning that Laura needed to file suit four years after leaving Scientology, i.e., by 2008. Laura’s attorneys argued that Scientology should be equitably estopped from asserting a statute of limitations defense where they had engaged in coercive and misleading tactics designed to prevent her from bringing a lawsuit.

The federal district court disagreed, reasoning that even if true, Laura was always aware of the underlying facts which formed the basis for the lawsuit. It remanded to the state court to address the non-federal claims, which, adopting the federal court’s logic, dismissed the remaining claims as time-barred but with leave to amend the complaint, which she did. The amended complaint didn’t change things for the state court, however, which again ruled that Laura’s claims were time barred, and dismissed the complaint, this time without leave to amend. Laura appealed, contending that upon leaving she had been threatened, intimidated, and lied to that documents she signed released Scientology from liability.

In its June 24, 2011 opinion, the California Court of Appeals (Second District) agreed with Laura, finding that she had…

adequately alleged that (1) she was unable to comprehend the wrongfulness of the defendants’ conduct for a period of time and that her causes of action did not accrue until she did so and (2) even after her delayed discovery of her causes of action, the defendants’ threats and intimidation caused her to delay filing her complaint.

Scientology had also argued that the federal court dismissal of her claims collaterally estopped (essentially, legally prevented due to a prior ruling) Laura from litigating those same issues, but the appeals court noted that the federal court’s dismissal came prior to Laura’s second amended complaint, which contained new allegations not precluded by the federal judgment.

The appeals court provides a thorough explanation of the legal principle (“equitable estoppel”) that permits Laura to bring otherwise time-barred claims, but the following definition is the most concise: “Where the delay in commencing action is induced by the conduct of the defendant it cannot be availed of by him as a defense.” In other words, if Scientology in any way caused Laura to delay filing her claims, they cannot assert a statute of limitations defense.

The appeals court then finds that Laura has more than adequately pled facts in her second amended complaint which, if true, prevent Scientology from asserting the statute of limitations as a defense. Those facts are as follows:

1. She was forced to work in harsh conditions and subjected to punishment;
2. At the time she terminated her employment and left the facility in 2004, she was required to sign documents purporting to exculpate defendants and requiring her to keep certain information confidential or suffer penalties and fines;
3. Defendants knew that those documents were contrary to law and unenforceable, and that defendants intended to intimidate her into believing that she had no legal rights against them;
4. She was told at that time that she owed defendants approximately $120,000 for her job training;
5. She remained a loyal Scientology follower until July 2008 and that, as a loyal follower, she was forbidden from reading or thinking anything negative about Scientology;
6. She was threatened with harassment and banishment from her family and friends who remained at the Scientology facilities if she were deemed an enemy of Scientology;
7. After leaving the facility, she made payments on her purported debt for some time because she believed that she was obligated to do so and she reasonably believed that she had no legal rights or claims against defendants because of their representations concerning the documents that she had signed; and
8. She first realized in July 2008 that she might have legal claims against defendants despite the documents she had previously signed, when she happened upon some information on the Internet and her family members then shared their concerns.

[The above is taken directly from the court of appeals decision but I took the liberty of reformatting it for readability purposes.]

It’s helpful to realize at this point that the court is assuming the above facts are true only for the purposes of affirmatively finding whether Laura has adequately pled a cause of action able to survive Scientology’s motion to dismiss. On remand, it will be the trial court’s task to discover “[w]hether plaintiff’s reliance on the alleged threats was reasonable” based on the evidence produced at trial. This effectively means that discovery may now commence in the Laura Decrescenzo v. Church of Scientology International, Inc., et al. lawsuit.

This leaves Scientology in something of a pickle. The last thing they want is a public inquiry into the horrific conditions endured by Sea Org members. As the above video bears out, Laura comes off as credible and highly sympathetic. A trial is incredibly risky. At the same time, settling carries its own risks. As nightmarish as Laura’s story is, it is sadly not uncommon, as anyone who has researched Scientology can and will tell you. To settle would be a tacit admission that Scientology’s standard practices–with nothing more–violate various torts, labor laws, and civil rights norms. It would also be a tacit admission that the form waivers and releases Scientology requires every member to sign are ultimately unenforceable.

So what will Scientology do? If history is a reliable guide, they’ll eagerly pursue Option C–that is, neither settling nor commencing discovery–for as long as they can. But I don’t want to think out loud on Scientology’s behalf with respect to their legal options so I’ll end this here.

There is a good reason this particular allegation triggered the most vehement reaction from Scientology: of all the transgressions documented by Wright, those implicating inurement are the most immediately detrimental to their tax exempt status. Religious entities considered exempt under Internal Revenue Code § 501(c) (3), as is Scientology, may not operate for the benefit of private individuals or interests. The IRS web site explicitly states, “no part of the net earnings of a section 501(c) (3) organization may inure to the benefit of any private shareholder or individual.” [emphasis added]

Few organizations know this better than Scientology, having been denied tax-exempt status on the basis of inurement before. In the decades prior to finally being awarded exempt status in the early 1990s, Scientology waged a war against the IRS. One of the more significant battles in that war was the Founding Church of Scientology v. United States case [188 Ct. Cl. 490 (Ct. Cl. 1969)] in which the Court of Claims found that Scientology’s finances were merely a personal compensation to benefit L Ron Hubbard (nearly 10% of its gross income, in fact). There is no shortage of additional precedent: See, e.g., Basic Bible Church v. Commissioner, 74 T.C. 846 (1980) (Court found inurement where nearly $33,000 received in contributions, more than $31,700 impermissibly benefited pastor for travel, home expenses); Southern Church of Universal Brotherhood Assembled v. Commissioner, 74 T.C. No. 89 (1980) (Court found a substantial amount of church income paid ministers’ and family’s rent and living expenses).

As we know, the Scientology offensive didn’t cease until the IRS finally relented in 1993 and granted them their long sought-after tax exemption. As we also know, both parties have since been notoriously tight-lipped as to the terms and context for the ostensibly “secret” deal. The IRS’s reversal of its stance on Scientology’s tax-exempt status was not only delivered in secret, it came sans any explanation as to what legal basis supported the reversal. Additionally, the IRS has subsequently defended the secrecy of their undisclosed agreement with Scientology (most notably in the Sklar I and Sklar II proceedings against the IRS).

The IRS has never offered an affirmative reason why they abruptly deemed Scientology as worthy of exempt status, after spending so many years arguing the converse. The most reasonable and benign excuse is that the IRS, from a resource standpoint, was worn down by the Scientology litigation machine, which had spawned hundreds of lawsuits, all which were withdrawn pursuant to the 1993 secret agreement. But even if one accepts this as an explanation, it cannot also be the objective basis by which Scientology earned its tax-exempt status. The “secret” agreement, which was leaked to the Wall Street Journal in 1997, simply presumes as fact that Scientology is now, suddenly, an exempt organization, with no further explanation to reconcile why they were not only a year prior.

Even if the IRS is remaining mum as to why Scientology suddenly became worthy of exempt status, we do know the bases by which a 501(c)(3) organization can jeopardize its status: (a) if its net earnings inure to an individual; (b) if it provides a substantial benefit to a private interest; (c) if it devotes a substantial part of its activities attempting to influence legislation; (d) if it participates or intervenes in any political campaign on behalf or in opposition to a candidate for public office; or (e) if its purposes and activities are illegal or “violate fundamental public policy.”

Decent arguments can be made that Scientology jeopardizes their exempt status by participating in nearly all of the aforementioned prohibited activities (save intervening in political campaigns). But proving that Scientology is so engaged is difficult for a number of reasons, the most obvious being that the type of behavior which ordinarily jeopardizes an organization’s exempt status requires documentation–documentation the corporately opaque Scientology will not surrender absent a court order. More importantly, Scientology’s natural adversary, the IRS, has essentially rejected its role as a check against Scientology’s abuse of its exempt status. Scientology doesn’t have to worry about disclosing documentation if the IRS is going to intervene on their behalf time and again. This is why a vigorous investigation of Scientology is needed.

Of all the bases undermining Scientology’s claim for exempt status, inurement would, at first glance, seem the most difficult to prove without extensive discovery into Scientology’s internal finances. Nevertheless, Brousseau’s story and pictures are prima facie evidence of inurement because the nature of the prohibited transactions alleged by Brousseau requires little more documentation than what Brousseau has provided–he served as both the quid and the quo in the transactions that bestowed private benefits upon Miscavige and Cruise. The organization pays Brousseau approximately $50 per week (which is legally squared under the “ministerial exception” to labor law, in order that Brousseau and others like him can perform “religious duties”) and Brousseau in turn performs professional, secular services (which would otherwise cost Miscavige and Cruise thousands) to private individuals, such as Scientology’s Chairman of the Board, and the Chairman’s best buddy, Tom Cruise. Simply put, that is inurement, and the IRS should investigate it, along with the dozens of similar stories.

Courts are wary of delving into the manner in which a religion organizes and conducts itself, largely because courts are prohibited by the first amendment from ruling on questions of religious orthodoxy. This wariness provides some wiggle room for religions being investigated for inurement to redefine potentially violating incidents as falling within a religious rubric. Why should a judge categorically prohibit a religious entity from refurbishing the motorcycle it bought for the head of the church? Viewed in isolation, this might be a close question. But the allegations of inurement have steadily mounted for Scientology and Miscavige and a picture is emerging that the IRS is negligent each day it ignores. One unique aspect of Brousseau’s allegation is that Tom Cruise–who is not a religious official–was a beneficiary of Brousseau’s services. Benefits inuring to Cruise do not implicate even a scintilla of grey legal space such as those benefits inuring to Miscavige, because no religious basis–not even a preposterous one–can justify the need for religious “ministers” to customize Tom Cruise’s motorcycles and S.U.V.

And now a message from our sponsors:

How To File An IRS 501(c)(3) Complaint from on Vimeo.

Note: This post first appeared in modified form on WhyWeProtest.net, and has since enjoyed significant editing and linking help from AnonLover.

But the news is largely good insofar as a jury is now scheduled to decide (amongst other things) whether Hubbard Management Technology is religious in nature. An adverse ruling for Diskeeper will greatly decrease the ability of other Scientology front groups to intrude into various secular spheres.

I don’t have the time to delve too deeply into the Court’s rulings, but I did perform some light research into a matter which seemed odd to me: that being the Court’s having removed punitive damages as an available remedy before trial. In American Airlines v. Sheppard, the state appeals court ruled that California’s “clear and convincing” evidentiary standard for punitive damages “does not impose on a plaintiff the obligation to ‘prove’ a case for punitive damages at summary judgment.” In other words, the Court prematurely ruled on punitive damages, which may yet be borne out at trial. I’m not a California lawyer, however, and so it’s not clear how this will play out.

For now, however, we can look forward to a trial.

Since Everson, we have consistently held the Clause applicable no less to governmental acts favoring religion generally than to acts favoring one religion over others.

The defendant school district in Lee v. Weisman, aware of its constitutional liability, sought to quell it by ensuring that the invocation (to be given by a Rabbi) be "denominationally neutral". The invocation would consist of generalized religious platitudes as opposed to specific denominational creeds.

Souter brilliantly countered this tack, first by offering a clear line of cases holding unconstitutional government preference for religion over irreligion; then by presenting a contratextual analysis of the establishment clause through its historical incarnations, interpreting its meaning by exhaustively comparing the rejected versions to final version:, finally concluding:

Though it accepted much of the Senate’s work on the Bill of Rights, the House rejected the Senate’s version of the Establishment Clause and called for a joint conference committee, to which the Senate agreed. The House conferees ultimately won out, persuading the Senate to accept this as the final text of the Religion Clauses: "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof." What is remarkable is that, unlike the earliest House drafts or the final Senate proposal, the prevailing language is not limited to laws respecting an establishment of "a religion," "a national religion," "one religious sect," or specific "articles of faith." The Framers repeatedly considered and deliberately rejected such narrow language and instead extended their prohibition to state support for "religion" in general.

Souter establishes that the framers repeatedly and deliberately edited the clause to exclude incarnations of a modified or specific "religion," finally settling on "religion" in its most general sense, and argues that the only reasonable inference to be drawn is that their intent was to prohibit the federal government from favoring not only religion x, y, or z, but from favoring religion, period. Souter’s textual reading cannot be easily dismissed because, as he makes clear, the drafters of the Constitution explicitly considered the linguistic implications of each option before settling on the broadest one.

Souter goes on:

While these considerations are, for me, sufficient to reject the nonpreferentialist position, one further concern animates my judgment. In many contexts, including this one, nonpreferentialism requires some distinction between "sectarian" religious practices and those that would be, by some measure, ecumenical enough to pass Establishment Clause muster. Simply by requiring the enquiry, nonpreferentialists invite the courts to engage in comparative theology. I can hardly imagine a subject less amenable tothe competence of the federal judiciary, or more deliberately to be avoided where possible.

If the government is permitted to advance a supposedly non-sectarian, or civil, religion, the Court will inevitably be thrust into the position of deciding whether a particular religious expression is sufficiently watered down and non-ecumenical to pass constitutional muster, and the Constitution plainly prohibits this. Souter explains why:

Nor does it solve the problem to say that the State should promote a “diversity” of religious views; that position would necessarily compel the government and, inevitably, the courts to make wholly inappropriate judgments about the number of religions the State should sponsor and the relative frequency with which it should sponsor each. In fact, the prospect would be even worse than that. As Madison observed in criticizing religious presidential proclamations, the practice of sponsoring religious messages tends, over time, “to narrow the recommendation to the standard of the predominant sect.” Madison’s “Detached Memoranda,” 3 Wm. & Mary Q. 534, 561 (E. Fleet ed. 1946) (hereinafter Madison’s “Detached Memoranda”). We have not changed much since the days of Madison, and the judiciary should not willingly enter the political arena to battle the centripetal force leading from religious pluralism to official preference for the faith with the most votes.

This is a point rarely advanced, but quite important: if government endorses a homogenized version of religious belief, it will effectively "crown a winner" from amongst religious competitors, and further, I’d argue, incentivize said competitors to match the religious message.

Souter then ably confronts the traditional counterargument–i.e., U.S. presidents, dating to around the time of the constitution’s drafting have issued generalized religious proclamations in inaugural addresses and Thanksgiving Day addresses, so therefore the framers could not have viewed the establishment clause as prohibiting state preferences for religion, generally:

The argument ignores the fact, however, that Americans today find such proclamations less controversial than did the founding generation, whose published thoughts on the matter belie petitioners’ claim. President Jefferson, for example, steadfastly refused to issue Thanksgiving proclamations of any kind, in part because he thought they violated the Religion Clauses. [...] During his first three years in office, James Madison also refused to call for days of thanksgiving and prayer, though later, amid the political turmoil of the War of 1812, he did so on four separate occasions. Upon retirement, in an essay condemning as an unconstitutional "establishment" the use of public money to support congressional and military chaplains, he concluded that "[r]eligious proclamations by the Executive recommending thanksgivings & fasts are shoots from the same root with the legislative acts reviewed. Altho’ recommendations only, they imply a religious agency, making no part of the trust delegated to political rulers." [citations omitted]

As for the presidents who, like Washington and Adams, unapologetically introduced public thanksgiving proclamations and prayer, Souter explains that "some Framers simply did not share a common understanding of the Establishment Clause, and, at worst, that they, like other politicians, could raise constitutional ideals one day and turn their backs on them the next." Which goes on to this day, as evidenced by Bush’s and now Obama’s Office of Faith Based Initiatives, amongst a litany of other examples of impermissible government-religion cross-pollination.

By the time Souter wrote his concurrence in Lee v. Weisman, his view on the establishment clause had already become descendent, as Protestants and Catholics had been migrating to Evangelical megachurches, which openly preached sought government endorsement, and politicians wasted no time in openly courting this new, identifiable religious demographic. Indeed, his concurrence was only joined by two other Justices (Stevens, and somewhat mysteriously, O’Connor, whose later opinions would repudiate Souter’s view here), although Souter was also part of the 5-4 majority. But Souter’s more expansive concurrence represented an incisive, sensible view of the establishment clause that likely won’t be seen for some time, to our detriment.

For one thing, Claire’s suit adds a significant defendant not present in Marc’s suit–Scientology’s Religious Technology Center ("RTC"), which sits above the also-named Church of Scientology International ("CSI") on the Scientology org chart. Whereas Marc worked exclusively for Golden Era Productions, an unincorporated entity under the CSI umbrella, Claire worked a variety of jobs including as a secretary for David Miscavige, the effective head of every Scientology entity, and the Chairman of RTC. CSI is considered the "mother church" and most of the management structure falls under it, but RTC controls Scientology’s trademarks and copyrights, and thus serves as the black hole into which the bulk of Scientologists’ money disappears.

More significant than the additional defendant is Claire’s claim that she was "ordered and coerced to have abortions by [Scientology] management." Paragraph 28 of the complaint states:

Plaintiff Headley worked for Defendants CSI and RTC for many years before her escape in 2005. During this time, Plaintiff became pregnant on two occasions. Plaintiff was ordered to terminate these pregnancies by forced abortions. Plaintiff is aware that this was a relatively common practice at Gold Base. Plaintiff has knowledge of approximately twenty other female employees ordered to have abortions.

Alongside the forced abortion allegation, Claire complains of other "unlawful and unfair business practices," namely: (i) "retaliation against Plaintiff’s family business and others for pursuing labor claims"; (ii) human trafficking; and (iii) unlawfully requiring lie detector testing through the use of Scientology’s "e-meter." These claims are not causes of actions in and of themselves, but are rather individual arguments in support of a larger unfair competition claim under California’s Business & Professions Code § 17200 et seq. Claire also employs the forced abortion allegation as a separate common law discrimination claim.

Claire’s forced abortion allegation comes well corroborated.

In a 1986 affidavit, ex-Sea Org member Mary Tabayoyon stated: "The September 28, 1986 Flag Order No. 3905 forbade Sea Org members from having any more new children. The reason given by ED Int. was that the Sea Org simply did not have the time, money and resources to raise children properly."

In a 1998 declaration, Jesse Prince stated: "In late 1991, my wife Monika became pregnant and although we were elated, she was ordered to abort the child. The reason for the abortion order is that Sea Org members were not allowed to have children."

In a 2001 declaration, Tera Hattaway spoke of the coercive techniques used to encourage abortion: "She went on to tell me that the spirit doesn’t enter the baby’s body until the baby is born. She made the point that all I would be “killing” is a piece of meat essentially. We discussed this for a couple of days and she showed me definitions in the L. Ron Hubbard Technical Dictionary to persuade me to have an abortion."

In a 2001 declaration, Astra Woodcraft stated: "Approximately 1½ years before I left, a new rule came out stating that if you got pregnant, you had to either get an abortion, which was heavily pushed, or leave. The rule had previously been that if you got pregnant, you had to get an abortion or be sent to a small and failing lower organization where you had to fend for yourself and your baby."

Scientology generally responds by labeling its accusers liars and apostates, but the excerpts above are but a sample of the countless other ex-members who have stated the same–the corroboration is on a level too vast and broad to dismiss so lightly. These stories share a commonality of motive and purpose: Scientology coerces and forces abortions because pregnant staff members are simply bad for business, due to the added expenses involved in the medical needs for pregnant women, the time lost when the pregnant woman cannot work, and the expense involved in providing day care when the child is born. The one-time cost of an abortion solves the problem.

Claire also alleges human trafficking, also as part of a larger unfair competition claim. Unlike the forced abortions allegation, there is a statutory analogue for human trafficking, namely California Penal Code § 236.1, which states that "[a]ny person who deprives or violates the personal liberty of another with the intent to … obtain forced labor or services, is guilty of human trafficking." Section 236.1 goes on to define "unlawful deprivation or violation of the personal liberty of another" as the "substantial and sustained restriction of another’s liberty accomplished through fraud, deceit, coercion, violence, duress, menace, or threat of unlawful injury to the victim or to another person[.]"[FN1]

While human trafficking has obviously been going on for centuries, United States law has only recently begun to address the topic, mostly in response to women’s groups bringing attention to the women being brought into the United States to work as prostitutes. While the California legislature likely didn’t have Scientology in mind when it passed the statute, it nevertheless appears broad enough that Claire could assert a claim under the CTVPA independently, although California does not explicitly provide civil remedy to trafficked persons. [CORRECTION: California Civil Code 52.5 provides a civil cause of action for human trafficking–see end of post for update] Professor Kathleen Kim, a professor at Loyala Law School created an instructive Powerpoint presentation, entitled "Civil Remedies for Victims of Human Trafficking" in which she extrapolates on the civil options available to victims of human trafficking, noting that the Federal human trafficking statute, upon which the California statute is modeled, provides a private cause of action.

Kim also suggests that civil human trafficking claims could be brought under the Thirteenth Amendment (involuntary servitude); the
Alien Tort Claims Act; RICO; the Fair Labor Standards Act; Title VII of the Civil Rights Act; Contract, tort, or negligence claims; or under state labor codes, which is what Claire Headley has done here, alleging human trafficking as part of her unfair business practices claim.

If the court were to rely on the penal code definition (stated above), Claire would have to show that Scientology "substantially restricted" her liberty through "deceit" or "coercion" because Scientology intended to obtain her forced labor. This does not seem an especially difficult task, although there would be a question as to which burden of proof would be employed (the criminal "beyond a reasonable doubt" burden is more difficult to show than the civil "preponderance of evidence" standard).

Claire’s complaint also departs from Marc’s in one other interesting way in that it specifically requests "A permanent injunction prohibiting Defendants and their agents for ordering and/or coercing abortions with respect to their employees." A similar request for a permanent injunction affecting non-parties going forward is presently at the heart of the Godelman v. Diskeeper lawsuit, presently ongoing in the same court (and which I’ve written about extensively on this blog, for which I’ve received legal threats from Diskeeper’s counsel). In that case, Diskeeper’s Scientologist lawyer, Tim Bowles, objected to an injunction prayer for relief that, if granted, would prohibit Diskeeper from requiring any employee to study, adopt, or apply L Ron Hubbard’s "Managment Tech" or "Study Technology" and thus moved to strike it from the complaint on the basis that it implicated Diskeeper’s religious freedom (despite their somewhat hypocritical argument that Hubbard Management and Study Technology are not religious). . Diskeeper’s motion to strike has not yet been ruled on but it would be interesting to see if Scientology responds to Claire’s request for prospective relief in the same manner.

The forced abortion and human trafficking allegations serve to bolster an otherwise decent claim, although the unfair business practice claim may turn to some degree on the nature of Claire’s work, which isn’t made entirely clear in the complaint (Scientology will want to argue that Claire’s work was religious in nature, so further scrutiny will likely be paid to precisely what Claire did for CSI and RTC). But unlike Marc’s suit, which focuses primarily on minimum wage and overtime pay, if it were found that Scientology engaged in tortious behavior by forcing and coercing abortions or engaging in human trafficking, a religious exemption argument may not be available to them, regardless of what Claire did for each organization. Religious organizations are as liable as secular ones for their tortious acts.

In sum, Claire’s claim would seem to have a decent chance of success at trial, assuming she can prove her allegations to a jury; but if history is an accurate indicator, Scientology will go to significant lengths to make sure it doesn’t get that far. Miles to go before we sleep, but the vehicle is promising for a change.

* [FN1] For a concise summary of the California Trafficking Victims Protection Act, see Michael C. Payne, The Half-Fought Battle; A Call for Comprehensive State Anti-Human Trafficking Legislation and a Discussion of How States Should Construct Such Legislation, 16 Kan. J.L. & Pub. Pol’y 48 (2006).

UPDATE: California Civil Code 52.5 provides a civil cause of action for human trafficking. To summarize the statute, the civil cause of action defines human trafficking identically to California’s Penal Code (section 236.1), and provides a range of remedies (actual (treble), compensatory, and punitive damages, as well as injunctive relief, attorney’s fees and costs). The statute of limitations is five years tolled from the "freedom date," or until the victim turns 26 (8 years past majority), if trafficking occurred while underage. Perhaps quite significantly, the statute of limitations can even be tolled (won’t begin until a later time) if the victim was under a "disability" at the time the trafficking took place–disability could mean "insanity, imprisonment, or other incapacity or incompetence " If the defendant induces the delay in filing (e.g., threats, duress), they’re estopped (legally prevented) from asserting the statute of limitations as a defense. Moreover, if the statute of limitations is suspended due to a disability, the estoppel applies to all other related claims arising out of the trafficking.

Headley also alleges that he was forced by Scientology to sign various documents, under duress, acknowledging that he had no rights as an employee, and that he was not given copies of these documents.

Headley’s claims are hardly shocking to anyone even vaguely familiar with Scientology, who could tell you that the working conditions for a Scientology staff member are routinely reported to be atrocious by ex-members. What is surprising is that someone has finally seen fit to address it, given the extreme hurdles facing anyone who chooses to sue Scientology.

The complaint anticipates Scientology’s likely legal response–in short, that it is a religious organization exempt from ordinary labor laws. The suit’s response to this anticipated defense is that religious organizations are not exempt in all instances from labor laws relating to minimum wage and relies heavily on the US Supreme Court case Alamo Found’n v. Secy. of Labor, 471 US 290 (1985) in support of its argument, which I’ll now briefly describe below.

The Secretary of Labor brought suit against Tony Alamo’s fundamentalist Christian church, alleging that it operated numerous commercial entities and in doing so violated minimum wage, overtime, and recordkeeping provisions of the Fair Labor Standards Act (FLSA). The Alamos operated “service stations, retail clothing and grocery outlets, hog farms, roofing and electrical construction companies, a recordkeeping company, a motel, and companies engaged in the production and distribution of candy,” and staffed these businesses with “drug addicts, derelicts, or criminals before their conversion and rehabilitation.” The Court found that the Alamos were subject to ordinary labor laws because (1) the church was, under the FLSA (specifically 29 USC sec. 203(s)), “an enterprise engaged in commerce or in the production of goods for commerce”; and (2) its workers were “employees” within the meaning of the Act.

The Court rejected the Alamos’ argument that it was not en enterprise within the meaning of the Act because it was a 501(c)(3) tax exempt organization, noting that religious and non-profit organizations are not exempted by FLSA.  The Code of Federal Regulations specifically states that

“where [religious or non-profit] organizations engage in ordinary commercial activities, such as operating a printing and publishing plant, the business activities will be treated under the Act the same as when they are performed by the ordinary business enterprise.“

The Alamos further argued that their church should be exempt because its commercial activities are “infused with a religious purpose,” but the Court noted that the lower courts had correctly disposed of this argument too, where it found that the Alamos’ “businesses serve the general public in competition with ordinary commercial enterprises,” and thus permitting the organization to pay substandard wages would give it an unfair advantage over competitors.

Scientology’s Golden Era Productions shares some similarities with the Alamos’ commercial enterprises but also some differences. It’s not clear whether those differences will lead a court to distinguish Headley’s suit from Alamo. It’s also not clear whether the fact that Headley is not suing under the FLSA but instead makes an unfair competition claim under California’s Business & Professional Code (sec. 17203), and California Labor Law will permit the Court to treat this case differently than similar cases, most/all of which fall under the FLSA (and thus Alamo). From my limited research, there is some interplay between California labor law (which is often described as “complex”) and the FLSA. (I presume that the absence of a FLSA claim is indicative of Headley’s lawyer’s desire to keep the case in California state court as opposed to federal court.)

As to the similarities between Golden Era Productions and Alamo, they both drastically underpaid and overworked their employees while providing them with housing and every other amenity imaginable. However, the individual businesses in Alamo operated in secular spheres–that is, their service stations, retail clothing stores, and motels directly and unfairly competed with corresponding secular entities, for whom the option to underpay its workers did not exist. Scientology will no doubt argue that Golden Era is engaged in promotional activities as opposed to commercial, and there is therefore no risk of unfair competition–it does not compete because it is the only entity that produces in L Ron Hubbard videos, and its adherents the only targeted class, unlike, say, a motel, which would target every demographic.

The response to this, I would think, is to note that the type of work Headley was engaged in at Golden Era–video production–is work also typically performed by secular entities, who otherwise might benefit from being contracted by Scientology for this work, and are thus in fact harmed in an unfair competition sense. The issue is not the content of the business’s output or the output’s target audience, in other words, but rather the type of business and whether there is a secular analogue capable and available to perform the same work.

This notion has some legal precedent too–In Mitchell v. Pilgrim Holiness Church Corp., 210 F.2d 879 (7th Cir. 1954), a religious organization operated and staffed a printing press, from which it printed “pamphlets, leaflets, magazines and other printed material most of which is of a religious nature,” and argued because religious message was not commerce, it should be exempt from the FLSA. The Fifth Circuit concluded that the religious content of the pamphlets was of no consequence, and that “[there is no] intimation that the minimum standard of living as fixed by the Act is not just as necessary to the health and well-being of the defendant’s employees as it is to the health and well-being of the employees of any other printing establishment.”

Mitchell is almost perfectly analogous to Golden Era, which too is a publisher of religious material utilizing underpaid labor.  California is not bound to follow a federal Fifth Circuit decision, of course, but with so little case law speaking directly to this issue, it seems likely that the Court will at least confront Mitchell, if not be persuaded by it. 

On Scientology’s side, there is little support in case law for the argument they will inevitably make, should the case proceed to trial. Mitchell has been distinguished but once, by McClure v. The Salvation Army, 460 F.2d 553, 558 (5th Cir.), cert. denied, 409 U.S. 896 (1972).  McClure did not concern minimum wage provisions, however, but was rather a wrongful termination claim brought by a fired a church minister. The Fifth Circuit determined that the minister was not an employee under Title VI
I of the Civil Rights Act, and further, that finding that the minister was wrongfully terminated would necessitate an impermissible encroachment into the Salvation Army’s right to free exercise or religion. McLure was followed by Werft v. Desert Southwest Annual Conf. of United Methodist Church, 377 F.3d 1099, 1100 n.1 (9th Cir. 2004).  The ministerial exception established in McLure was just recently extended to FLSA scenarios by the Seventh Circuit in Schleicher v. Salvation Army, 2007 U.S. Dist. LEXIS 2836 (7th Cir. 2007), but Schleicher concerned the wages of a minister, and thus not an employee under the FLSA.

Alamo has been distinguished many times, but never again in the context of a religious group seeking to evade labor laws, so the penultimate battle at trial will chiefly be over whether to follow or distinguish Alamo, as I describe above.

Before trial, of course, there will be a slew of motions and creative lawyering by Scientology to delay this trial until the end of time. There is undoubtedly the most serious legal challenge they’ve faced in years and they almost certainly realize it and will act accordingly. One especiallly intriguing pretrial question is whether Scientology will challenge Headley on the basis of the numerous releases and waivers Headley signed. Headley speaks of the releases in his complaint, alleging that they are invalid for lack of consideration and unconscionable, an assertion which is likely correct. Although Headley doesn’t include the releases in his complaint, and I thus have no actual knowledge of them, I have reviewed many other Scientology releases and have noted prior occasions their telltale signs–they all inevitably lack consideration and usually contain unconscionable terms. Headley adds that his were signed under duress, an assertion which I have little trouble believing.  Will Scientology actually produce Headley’s signed releases as evidence of his relinquishing the right to sue? A loss on this front would be a minor devastation as Scientology has relied on these unconscionable releases for years (and although they’ve never really been tested, the releases likely “work” in that many ex-members are probably intimidated into not bringing a suit against Scientology because they assume the release is valid; invalid or not, the releases possess a deterrent quality).

I will be keeping a close eye on this lawsuit as it progresses and write about it as time allows.