LDS Church urges court to toss out James Huntsman’s lawsuit, says his bid for tithing refund is ‘without merit’

Attorneys for the Utah-based faith say many of the former member’s claims read more like “editorial comment” than legal arguments.

(Rick Egan | Salt Lake Tribune file photo) The Church of Jesus Christ of Latter-day Saints Administration Building, on South Temple in Salt Lake City, on Wednesday, March 31, 2021. The church has asked a federal court to reject a fraud lawsuit filed against it by James Huntsman.

Lawyers for The Church of Jesus Christ of Latter-day Saints are asking a federal judge to toss out the high-profile lawsuit brought in March by James Huntsman accusing the faith’s leaders of fraud and demanding the return of millions of dollars in tithing.

The California resident and wealthy brother of former Utah Gov. Jon Huntsman Jr. lacks a valid legal argument to bring the claim to recover his donations, church attorneys argued Wednesday in a new court filing seeking to shut down the case.

Huntsman made those gifts between 1993 and 2017 without placing any conditions on them at the time, church lawyers based in California state, giving him no legal basis to ask for them back now — despite his allegations church leaders acted deceptively in how they spent them.

His claims of fraud, deception and that leaders misled members are also false, church attorneys asserted. They added that the wealthy former Utahn’s case missed a statute of limitations deadline when it was filed and that Huntsman also lacks legal standing to sue the denomination over allegations the funds were misused.

“The church prays that Mr. Huntsman’s complaint be dismissed with prejudice,” lawyers wrote in the seven-page response, calling his highly publicized federal suit “without merit” and “not maintained in good faith.”

The 50-year-old Huntsman sued the Utah-based faith in U.S. District Court in California in late April, saying its leaders “repeatedly and publicly lied” about the use of billions of dollars in member donations, meant for building temples, missionary work and other charitable and educational endeavors.

While they assured faithful Latter-day Saints otherwise, Huntsman asserted, church leaders instead diverted up to $2 billion in tithing funds to two of its private businesses, including City Creek Center, an upscale mall in downtown Salt Lake City.

Those claims are based on a separate whistleblower’s complaint to U.S tax officials in late 2019, alleging the global faith of 16.5 million members kept nearly $100 billion in an account meant for charity work but spent some of the cash on commercial ventures — including payments to bolster City Creek Center.

(Courtesy photo) James Huntsman

Huntsman, the owner of the Los Angeles film distributing company Blue Fox Entertainment and son of the late Utah industrialist-philanthropist Jon Huntsman Sr., is demanding more than $5 million in cash he says he tithed to the church over 24 years as a faithful member, along with legal damages.

Huntsman said in legal filings that he approached church officials “several times” about getting his tithing back but was turned away. In their legal response, church attorneys denied that Huntsman’s tithing over those years “amounted to millions of dollars.”

One legal expert has labeled his lawsuit “performative,” meant more for publicity than pressing a legal cause. Similarly, the church’s response rejected many of Huntsman’s assertions as “editorial comment,” lacking in legal and factual basis.

Sam Brunson, a Latter-day Saint and a tax law professor at Loyola University in Chicago, called the church’s initial reply to Huntsman’s suit “a very solid response, done exactly the way that a response is done.”

“It actually strikes me as being fairly devastating,” Brunson said, “but it’s done without fireworks or theatrics.”

The scholar said he found it notable church officials also were seeking to recoup their legal costs in the response. “This is also them signaling probably to the court and to Huntsman, ‘Hey, this lawsuit is really frivolous.’”

Without elaboration, the church’s response also asserted that Huntsman’s lawsuit is barred under the U.S. Constitution’s First Amendment protections for religious freedom and similar provisions under the California Constitution.

Legal precedent in Utah indicates religious groups can be sued for fraud under certain circumstances.

Huntsman and his Los Angeles attorney in the matter, David Jonelis, have declined to comment on the case. Church officials also declined to comment late Wednesday.

After Huntsman filed his lawsuit, a church spokesperson called the action “baseless” and noted that he had resigned his church membership in 2020.

Huntsman’s lawsuit draws heavily on assertions by IRS whistleblower David Nielsen. The former portfolio manager for Ensign Peak Advisors, an investment arm of the church, accused the faith’s leaders of dodging taxes on the $100 billion “rainy day” fund and making zero charitable expenditures while spending money on City Creek and a church-backed insurance firm that fell into financial trouble.

Church officials repeatedly have denied that tithing funds were used on City Creek Center. And while the church’s legal response filed Wednesday rejected most of Huntsman’s claims with a few words, it goes to greater lengths in rebutting the City Creek allegation.

The filing quotes an April 2003 sermon at the faith’s General Conference by then-Church President Gordon B. Hinckley, announcing the faith’s decision on the shopping mall, near its Salt Lake Temple.

“I wish to give the entire church the assurance that tithing funds have not and will not be used to acquire this property,” Hinckley said. “Nor will they be used in developing it for commercial purposes.”

The legal response noted elsewhere that the church “avers that those statements are true.”

Court documents filed along with the church’s response indicate presiding Judge Stephen Wilson has ordered attorneys for both sides to appear in court June 28 to review the lawsuit, along with the prospects of settling it out of court.

Editor’s note James Huntsman is a brother of Paul Huntsman, chairman of the nonprofit Salt Lake Tribune’s board of directors.