Bibiji Kaur Puri v. Sopurkh Kaur Khalsa ( 2017 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
BIBIJI INDERJIT KAUR PURI; No. 13-36024
RANBIR SINGH BHAI; KAMALJIT
KAUR KOHLI; KULBIR SINGH D.C. No.
PURI, 3:10-cv-01532-MO
Plaintiffs-Appellants,
v. OPINION
SOPURKH KAUR KHALSA;
PERAIM KAUR KHALSA; SIRI
RAM KAUR KHALSA; SIRI KARM
KAUR KHALSA; KARTAR SINGH
KHALSA; KARAM SINGH
KHALSA; ROY LAMBERT;
SCHWABE, WILLIAMSON &
WYATT, an Oregon Professional
Corporation; LEWIS M.
HOROWITZ; LANE POWELL PC,
an Oregon Professional
Corporation; UNTO INFINITY,
LLC, an Oregon Limited
Liability Company; SIRI SINGH
SAHIB CORPORATION, an Oregon
non-profit corporation; DOES, 1
through 5,
Defendants-Appellees.
2 PURI V. KHALSA
Appeal from the United States District Court
for the District of Oregon
Michael W. Mosman, Chief District Judge, Presiding
Argued and Submitted March 10, 2016
Portland, Oregon
Filed January 6, 2017
Before: Raymond C. Fisher, Marsha S. Berzon
and Paul J. Watford, Circuit Judges.
Opinion by Judge Fisher
SUMMARY*
First Amendment
The panel vacated the district court’s dismissal, as
foreclosed by the Free Exercise and Establishment Clauses of
the First Amendment, of claims concerning a dispute over the
control of two nonprofit entities associated with the Sikh
Dharma religious community.
The panel held, based only on the pleadings, that the
claims were not barred by the First Amendment’s ministerial
exception. The panel held that the ecclesiastical abstention
doctrine did not apply because the claims could be resolved
by application of neutral principles of law without
*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
PURI V. KHALSA 3
encroaching on religious organizations’ right of autonomy in
matters of religious doctrine and administration.
The panel addressed additional issues in a concurrently
filed memorandum disposition.
COUNSEL
Surjit P. Soni (argued) and Leo E. Lundberg, Jr., The Soni
Law Firm, Pasadena, California; R. Scott Palmer, Watkinson
Laird Rubenstein Baldwin & Burgess P.C., Eugene, Oregon;
for Plaintiffs-Appellants.
Paul J.C. Southwick (argued) and John F. McGrory, Jr., Davis
Wright Tremaine LLP, Portland, Oregon, for Defendants-
Appellees Unto Infinity, LLC; Siri Singh Sahib Corporation;
Kartar Singh Khalsa; Karam Singh Khalsa; Peraim Kaur
Khalsa; Siri Karm Kaur Khalsa; and Sopurkh Kaur Khalsa.
Janet M. Schroer (argued), Portland, Oregon; Ralph E.
Cromwell, Jr., Byrnes Keller Cromwell LLP, Seattle,
Washington; for Defendants-Appellants Schwabe,
Williamson & Wyatt.
Susan E. Watts (argued), Portland, Oregon; Joseph C.
Arellano, Kennedy Watts Arellano LLP, Portland, Oregon,
for Defendants-Appellees Lane Powell PC and Lewis M.
Horowitz.
Leslie S. Johnson, Kent & Johnson LLP, Portland, Oregon,
for Defendant-Appellee Siri Ram Kaur Khalsa.
4 PURI V. KHALSA
Stephen C. Voorhees and Candice R. Broock, Kilmer
Voorhees & Laurick PC, Portland, Oregon, for Defendant-
Appellee Roy Lambert.
Susan Bower and Rebecca M. Auten, Assistant Attorneys
General; Anna M. Joyce, Solicitor General; Ellen F.
Rosenblum, Attorney General; Oregon Department of Justice,
Salem, Oregon; for Amicus Curiae State of Oregon.
OPINION
FISHER, Circuit Judge:
This appeal concerns a dispute over the control of two
nonprofit entities associated with the Sikh Dharma religious
community. The plaintiffs, the widow and children of the late
spiritual leader of the Sikh Dharma faith, brought claims
against various individuals and entities alleging several
interlocking conspiracies and fraudulent activities designed
to exclude them from certain management positions and to
convert millions of dollars in assets from entities under the
individual defendants’ control for personal benefit. The
district court dismissed the plaintiffs’ complaint, concluding
their claims were foreclosed by the Free Exercise and
Establishment Clauses of the First Amendment.1 We vacate
1
This opinion addresses only the defendants’ First Amendment
defense to the plaintiffs’ direct claims. The plaintiffs also brought several
derivative claims on behalf of Siri Singh Sahib Corporation and Unto
Infinity, LLC. In a concurrently filed memorandum disposition, we affirm
dismissal of those derivative claims. The memorandum disposition also
addresses the parties’ remaining arguments regarding the plaintiffs’ direct
claims.
PURI V. KHALSA 5
the district court’s dismissal because we conclude, based only
on the pleadings, that the plaintiffs’ claims are not barred by
the First Amendment’s ministerial exception and can be
resolved by application of neutral principles of law without
encroaching on religious organizations’ right of autonomy in
matters of religious doctrine and administration.
BACKGROUND
This case comes to us on the pleadings, so we accept the
plaintiffs’ factual allegations as true. Our review is limited to
the facts alleged in the plaintiffs’ first amended complaint
(“complaint”) and the attached exhibits incorporated by
reference therein. See Elvig v. Calvin Presbyterian Church,
375 F.3d 951, 953 (9th Cir. 2004).
Yogi Harbhajan Singh Khalsa, also known as Yogi
Bhajan, was a spiritual leader and entrepreneur who spread
Sikhism and Kundalini Yoga in the United States beginning
in the 1960s. In 1971, he was designated the Siri Singh
Sahib, the Sikh leader for the Western Hemisphere. Yogi
Bhajan founded or inspired the creation of numerous for-
profit and nonprofit entities that were held and controlled by
Siri Singh Sahib of Sikh Dharma (SSSSD), a California
corporation sole of which he was the only shareholder.2
Three of these entities are particularly relevant to this case:
Siri Singh Sahib Corporation, Unto Infinity, LLC, and Sikh
Dharma International.
2
Under California law, a corporation sole is a corporation “formed
. . . by the bishop, chief priest, presiding elder, or other presiding officer
of any religious denomination, society, or church, for the purpose of
administering and managing the affairs, property, and temporalities
thereof.” Cal. Corp. Code § 10002.
6 PURI V. KHALSA
Yogi Bhajan formed Siri Singh Sahib Corporation (SSSC)
as an Oregon nonprofit religious corporation “to act as the
successor legal organization to [SSSSD]” following his death
or incapacity, “and in such capacity to conduct and/or
facilitate religious, charitable and educational activities.”
SSSC would become “the guardian of those assets of
[SSSSD] which are conveyed to it,” and would replace
SSSSD as the sole member of Unto Infinity, LLC. Yogi
Bhajan was the sole director, or “trustee,” of SSSC at its
founding, but the SSSC articles of incorporation provided that
following his death or incapacity, “the directors shall be those
persons designated in writing by [Yogi Bhajan],” with such
written designation to be “delivered to, and held in
confidence by, the attorney for the corporation.” The articles
also set out certain religious criteria for directors:
No individual will be eligible to be designated
or elected as a trustee unless he or she . . . is
currently qualified as a minister of Sikh
Dharma; . . . is an active participant in
Dasvandh [tithing]; . . . [and] is then living,
and participating in the affairs of the Sikh
community, in a manner consistent with the
teachings and values of [Yogi Bhajan], and
accepts the directives and proclamations of
[Yogi Bhajan] as Siri Singh Sahib of Sikh
Dharma, as such teachings, values, directives,
and proclamations are understood by the Siri
Sikdar Sahib/a of Sikh Dharma . . . .
Yogi Bhajan formed Unto Infinity, LLC (UI), as an
Oregon nonprofit limited liability company to serve as a
member or shareholder of various for-profit and nonprofit
entities. Under UI’s operating agreement, SSSSD was to be
PURI V. KHALSA 7
the sole member of UI until Yogi Bhajan’s death or
incapacity, at which time SSSC would assume that role, and
UI would become the sole member of Sikh Dharma
International. Acting by virtue of his exclusive control over
SSSSD, Yogi Bhajan appointed himself and four others to the
UI board of managers, which would “exercise full and
exclusive control over the affairs of the Company, subject to
restrictions on that authority under the Oregon Limited
Liability Company Act.” The UI operating agreement set
forth the same religious eligibility criteria for its board of
managers as the SSSC articles established for its directors.
Yogi Bhajan formed Sikh Dharma International (SDI) as
a California nonprofit religious corporation “organized to
advance the religion of Sikh Dharma and as an association of
religious organizations teaching principles of Sikh Dharma,
including by ordination of ministers of divinity and operation
of places of worship.” SDI’s sole member is UI.
Yogi Bhajan died in October 2004. He was survived by
the plaintiffs in this case – his wife, Bibiji Inderjit Kaur Puri
(“Bibiji”), and their three children, Ranbir Singh Bhai
(“Ranbir”), Kamaljit Kaur Kohli and Kulbir Singh Puri.
They allege the general counsel and five board members of
UI and SSSC conspired to exclude them from participating in
the management of those organizations.
First, the plaintiffs assert they have been improperly
excluded from the SSSC board of trustees. They allege Yogi
Bhajan, acting pursuant to the SSSC articles of incorporation,
designated all four of them to become board members
following his death or incapacity and furnished the written
designation to defendant Roy Lambert, attorney for SSSC.
Lambert allegedly failed to produce the designation following
8 PURI V. KHALSA
Yogi Bhajan’s death, and the defendants then held board
meetings without providing notice to the plaintiffs and
without the plaintiffs’ attendance, in violation of SSSC
bylaws and Oregon law. Second, the plaintiffs allege the UI
board of managers added Bibiji as a manager of UI on July
26, 2004, prior to Yogi Bhajan’s death, by unanimous written
consent, but the defendants failed to inform her of her
election and denied her the rights and duties of board
membership.
In support of their claims, the plaintiffs point to various
emails and corporate documents, attached to their complaint
and incorporated by reference, that they allege confirm their
allegations of wrongful exclusion from the SSSC and UI
boards. On July 26, 2004, all five members of the UI board
of managers apparently adopted a resolution increasing the
membership of the board to six and electing Bibiji “to fill the
new position as manager of the Corporation.” In October
2004, defendant Sopurkh Kaur Khalsa (“Sopurkh”), president
of the UI board of managers, left a voicemail message for
plaintiff Ranbir explaining that she and Lambert were
“proceeding on getting you guys on the Board” of SSSC and
UI. Sopurkh followed up by email with a “Memo of
Understanding” acknowledging that Bibiji was “already on
[the] board” of UI and confirming that all four plaintiffs
would be added to the SSSC and UI boards. In September
2005, Sopurkh apparently changed course, explaining to
Bibiji that the previous Memo of Understanding
“inadvertently omitted a statement regarding the corporate
involvement of you and your children,” and the “[m]emo was
not intended to indicate either current board membership for
you and your children or agreement that you and your
children would ultimately be elected to the listed boards.”
Sopurkh furnished a “revised Memo of Understanding which
PURI V. KHALSA 9
corrects the prior error,” clarifying that the memo constituted
her “understanding of the family’s request to be included in
the various boards in our organization.” The revised
document nonetheless reiterated Bibiji was “already on [the]
board” of UI. Two months later, when Lambert sent an email
listing “the board of [SSSC] as designated by [Yogi Bhajan],”
two of the plaintiffs’ names appeared on the list.
The plaintiffs’ complaint seeks a judgment that Bibiji
“has been a Manager of UI from and after July 26, 2004” and
that all four plaintiffs “be appointed to the Board of Trustees
of SSSC.” They also seek damages for lost compensation
they would have received for their services on the boards.
After the defendants moved to dismiss for failure to state a
claim upon which relief can be granted, see Fed. R. Civ. P.
12(b)(6), the plaintiffs moved for leave to file a second
amended complaint. The district court granted the
defendants’ motions to dismiss, denied the motion for leave
to amend and entered a judgment of dismissal with prejudice.
The plaintiffs timely appealed.
STANDARD OF REVIEW
We review de novo a district court’s dismissal for failure
to state a claim upon which relief can be granted. See
Daniels-Hall v. Nat’l Educ. Ass’n, 629 F.3d 992, 998 (9th
Cir. 2010). We accept as true all well-pleaded allegations of
material fact and construe them in the light most favorable to
the plaintiffs. See id. We also review de novo a district
court’s legal determinations, including constitutional rulings,
and its determinations on mixed questions of law and fact that
implicate constitutional rights. See Berger v. City of Seattle,
569 F.3d 1029, 1035 (9th Cir. 2009) (en banc).
10 PURI V. KHALSA
DISCUSSION
The question before us is whether the Free Exercise and
Establishment Clauses of the First Amendment preclude a
civil court from granting relief on the plaintiffs’ claims,
which seek declaratory and injunctive relief in the form of
placement on the management boards of organizations
associated with the Sikh Dharma religious community as well
as damages for lost compensation due to their previous
exclusion from those boards. The defendants raise the
“ministerial exception” as an affirmative defense, and
contend even if that exception does not apply, the plaintiffs’
claims still cannot be decided by a civil court because the
requested relief would infringe on the sphere of autonomy
constitutionally guaranteed to religious organizations.
I.
A.
The Supreme Court has long recognized religious
organizations’ broad right to control the selection of their
own religious leaders. See, e.g., Gonzalez v. Roman Catholic
Archbishop of Manila, 280 U.S. 1, 16 (1929). Recently, the
Court “confirm[ed] that it is impermissible for the
government to contradict a church’s determination of who
can act as its ministers,” and formally recognized “a
‘ministerial exception,’ grounded in the First Amendment,
that precludes application of [employment discrimination
laws] to claims concerning the employment relationship
between a religious institution and its ministers.” Hosanna-
Tabor Evangelical Lutheran Church & Sch. v. EEOC, 132 S.
Ct. 694, 704–05 (2012). This ministerial exception “ensures
that the authority to select and control who will minister to
PURI V. KHALSA 11
the faithful – a matter ‘strictly ecclesiastical’ – is the church’s
alone.” Id. at 709 (citation omitted) (quoting Kedroff v. Saint
Nicholas Cathedral of Russian Orthodox Church in N. Am.,
344 U.S. 94, 119 (1952)). The Court explained:
Requiring a church to accept or retain an
unwanted minister, or punishing a church for
failing to do so, intrudes upon more than a
mere employment decision. Such action
interferes with the internal governance of the
church, depriving the church of control over
the selection of those who will personify its
beliefs. By imposing an unwanted minister,
the state infringes the Free Exercise Clause,
which protects a religious group’s right to
shape its own faith and mission through its
appointments. According the state the power
to determine which individuals will minister
to the faithful also violates the Establishment
Clause, which prohibits government
involvement in such ecclesiastical decisions.
Id. at 706.
Although the Supreme Court has not articulated the scope
of the ministerial exception beyond employment
discrimination claims, see id. at 710, our court has framed the
exception as applicable “to any state law cause of action that
would otherwise impinge on the church’s prerogative to
choose its ministers or to exercise its religious beliefs in the
context of employing its ministers.” Bollard v. Cal. Province
of the Soc’y of Jesus, 196 F.3d 940, 950 (9th Cir. 1999); see
also Werft v. Desert Sw. Annual Conference of United
Methodist Church, 377 F.3d 1099, 1100 n.1 (9th Cir. 2004).
12 PURI V. KHALSA
Thus, any claim “with an associated remedy . . . [that] would
require the church to employ [a minister]” would “interfer[e]
with the church’s constitutionally protected choice of its
ministers,” and thereby “would run afoul of the Free Exercise
Clause.” Bollard, 196 F.3d at 950. The ministerial exception
also bars relief for “consequences of protected employment
decisions,” such as damages for “lost or reduced pay,”
because such relief “would necessarily trench on the Church’s
protected ministerial decisions.” Elvig, 375 F.3d at 966; see
also Hosanna-Tabor, 132 S. Ct. at 709 (“An award of such
relief would operate as a penalty on the Church for
terminating an unwanted minister, and would be no less
prohibited by the First Amendment than an order overturning
the termination.”).
B.
The ministerial exception is an affirmative defense. See
Hosana-Tabor, 132 S. Ct. at 709 n.4. It applies to claims that
impinge on protected employment decisions regarding “a
religious organization and its ministers,” Elvig, 375 F.3d at
955 (quoting Bollard, 196 F.3d at 945), and when applicable,
it flatly prohibits courts from “[r]equiring a church to accept
or retain an unwanted minister, or punishing a church for
failing to do so,” Hosanna-Tabor, 132 S. Ct. at 706.
As an affirmative defense, the ministerial exception can
serve as the basis for dismissing a complaint at the pleadings
stage under Rule 12(b)(6) only when the elements of the
defense appear on the face of the complaint. See Jones v.
Bock, 549 U.S. 199, 215 (2007) (citing 5B Charles Alan
Wright & Arthur R. Miller, Federal Practice and Procedure
§ 1357 (3d ed. 2004)); Rivera v. Peri & Sons Farms, Inc.,
735 F.3d 892, 902 (9th Cir. 2013). Therefore, if it is apparent
PURI V. KHALSA 13
on the face of the plaintiffs’ complaint that the defendants’
refusal to seat the plaintiffs on the disputed boards is a
“protected employment decision[]” under the ministerial
exception, see Elvig, 375 F.3d at 963, the plaintiffs’ claims
are altogether barred, and a civil court can neither order the
defendants to employ the plaintiffs nor award damages
against the defendants for past or future failure to do so.
The defendants argue the complaint should be dismissed
under the ministerial exception because it seeks relief for a
protected employment decision made by a religious
organization concerning its ministers. Specifically, they
contend the complaint alleges both that SSSC and UI are
“religious organizations” covered by the exception, and that
the disputed board positions are “ministerial” because they
can be occupied only by individuals meeting certain
“religious requirements,” including that they be Sikh
ministers. The plaintiffs do not dispute SSSC and UI are
religious organizations within the meaning of the ministerial
exception, but they argue the board positions are not
ministerial because, on the face of the complaint, it is not
apparent their duties involve conveying the church’s message
or carrying out its religious mission.3
As a threshold matter, it is not clear that the ministerial
exception could ever apply to the type of positions at issue
here. This is a dispute over seats on the boards of corporate
entities that are apparently affiliated with a church, but are
3
The plaintiffs also argue the religious requirements for SSSC board
membership do not apply to them, relying on an exhibit attached to their
disallowed second amended complaint. We do not reach this argument
because, even assuming the plaintiffs are subject to the religious
requirements, we conclude the ministerial exception does not apply.
14 PURI V. KHALSA
not themselves churches. Thus, the positions are far afield
from the “paradigmatic application of the ministerial
exception” to ordained ministers employed by a church, such
as Roman Catholic priests who “minister to the faithful” as
that term is generally understood. See Alcazar v. Corp. of the
Catholic Archbishop of Seattle, 627 F.3d 1288, 1291 (9th Cir.
2010) (en banc). Neither the Supreme Court nor this court
has applied the ministerial exception to the governing boards
of church-affiliated organizations, let alone to those whose
responsibilities are largely secular, as the complaint alleges
here. There is, therefore, reason to question whether the
exception is even potentially implicated.
At the same time, neither the Supreme Court nor this
court has ever expressly limited the ministerial exception to
particular types of positions, and both courts have expressly
declined to adopt any bright line rule defining the scope of
the exception. As the Supreme Court has made clear, there
is no “rigid formula for deciding when an employee qualifies
as a minister” within the meaning of the ministerial
exception. Hosanna-Tabor, 132 S. Ct. at 707. Our en banc
court echoed that view in Alcazar, where we “declined to
adopt any particular test” for “determining whether a
particular church employee . . . should be considered a
‘minister’” for First Amendment purposes. 627 F.3d at 1291.
Certain language in Hosanna-Tabor, moreover, suggests a
fairly broad application of the exception. The Court
explained “[t]he ministerial exception is not limited to the
head of a religious congregation,” and insulates a religious
organization’s “selection of those who will personify its
beliefs.” Hosanna-Tabor, 132 S. Ct. at 706–07. The Court
further suggested the exception extends to “the Church’s
choice of its hierarchy” when that choice implicates “a
religious group’s right to shape its own faith and mission.”
PURI V. KHALSA 15
Hosanna-Tabor, 132 S. Ct. at 705–06. We too have
suggested a potentially broad reach for the exception. See
Bollard, 196 F.3d at 947 (referring to the ministerial
exception as protecting “a church’s freedom to choose its
representatives”). In practice, there may be little difference
between deciding whether a defendant has established the
affirmative defense of the ministerial exception with respect
to a hiring decision for a particular employment position in a
particular case and deciding categorically whether the
exception applies to hiring decisions for an entire type or
class of employment positions, such as governing boards of
church-affiliated organizations. As explained below, the
former analysis considers, among other things, “the nature of
the religious functions performed” and “[t]he amount of time
an employee spends on particular activities.” Hosanna-
Tabor, 132 S. Ct. at 709. Any categorical analysis likely
would turn on very similar inquiries.
Ultimately, we do not attempt to resolve the question of
whether the ministerial exception ever applies to the type of
positions at issue here. We need not categorically define the
scope of the ministerial exception, because even if it is
potentially available in a case such as this one, it is clear the
defendants here have failed to make out the defense at this
juncture. For the purpose of the following analysis, therefore,
we only assume without deciding that the exception is
potentially implicated with respect to the type of positions in
dispute in the case before us.
The Supreme Court has provided some guidance on the
circumstances that might qualify an employee as a minister
within the meaning of the ministerial exception. First, an
employee is more likely to be a minister if a religious
organization holds the employee out as a minister by
16 PURI V. KHALSA
bestowing a formal religious title. See id. at 707. Although
an ecclesiastical title “by itself, does not automatically ensure
coverage, the fact that an employee has been ordained or
commissioned as a minister is surely relevant.” Id. at 708. A
second consideration is the “substance reflected in that title,”
such as “a significant degree of religious training followed by
a formal process of commissioning.” Id. at 707–08. Third,
an employee whose “job duties reflect[] a role in conveying
the Church’s message and carrying out its mission” is likely
to be covered by the exception, even if the employee devotes
only a small portion of the workday to strictly religious duties
and spends the balance of her time performing secular
functions. Id. Finally, an employee who holds herself out as
a religious leader is more likely to be considered a minister.
Id.
Based on the pleadings here, some circumstances weigh
in favor of considering the board positions ministerial. The
complaint alleges that a “mission and purpose” of SSSC and
UI is “to benefit the Sikh Dharma community and to advance
and promote [Yogi Bhajan’s] teachings,” and it is “surely
relevant” that their board members must be ordained
ministers of Sikh Dharma and must meet certain other
religious criteria. See id. at 708.
But, based on the face of the complaint, a number of other
circumstances weigh against applying the ministerial
exception. First, and most importantly, the pleadings do not
allege the board members have any ecclesiastical duties or
privileges. In assessing the responsibilities attendant to the
board positions, it is relevant that the entities involved are not
themselves churches, but rather corporate parents of a church.
SSSC’s primary responsibility appears to be holding title to
church property, and UI, in addition to being the sole member
PURI V. KHALSA 17
of SDI – i.e., the direct corporate parent of the Sikh Dharma
church – owns and controls a portfolio of for-profit and
nonprofit corporations, including a major security contractor
and a prominent tea manufacturer. Although the complaint
alleges the board members have “fiduciary duties to UI and
SSSC to hold assets in trust for the benefit of the Sikh
Dharma community,” it is not clear on the face of the
complaint that these duties are “religious” or “reflect[] a role
in conveying the Church’s message and carrying out its
mission.” Id.
No religious duties comparable to those found relevant in
Hosanna-Tabor appear in the pleadings here. In Hosanna-
Tabor, the Supreme Court observed the plaintiff was
“expressly charged . . . with ‘lead[ing] others toward
Christian maturity’ and ‘teach[ing] faithfully the Word of
God, the Sacred Scriptures, in its truth and purity and as set
forth in all the symbolical books of the Evangelical Lutheran
Church.’” Id. “In fulfilling these responsibilities, [the
plaintiff] taught her students religion[,] . . . led them in
prayer[,] . . . took her students to a school-wide chapel
service, and . . . took her turn leading it, choosing the liturgy,
selecting the hymns, and delivering a short message based on
verses from the Bible.” Id. The Court concluded, “[a]s a
source of religious instruction, [the plaintiff] performed an
important role in transmitting the Lutheran faith to the next
generation.” Id. By contrast, none of the allegations here
support a similar conclusion.
Although the Court has cautioned against relying too
heavily on “the relative amount of time . . . spent performing
religious functions,” it has recognized that “the nature of the
religious functions performed” and “[t]he amount of time an
employee spends on particular activities” are relevant
18 PURI V. KHALSA
considerations. Id. at 709. We, too, have “look[ed] to the
function of the position . . . in deciding whether the
ministerial exception applies,” Elvig, 375 F.3d at 958, and
have held, for instance, that the exception does not apply “to
lay employees of a religious institution if they are not serving
the function of ministers,” Bollard, 196 F.3d at 947. The
pleadings do not allege the board members “serv[e] the
function of ministers.” Id.
Second, the pleadings do not allege the board members
are held out as religious leaders, either by their respective
employers or by the board members themselves. A board
member of UI or SSSC has the job title of “manager” or
“trustee,” respectively, and the pleadings do not suggest these
apparently secular titles hold any ecclesiastical significance
in the Sikh Dharma faith. Although a board member must be
“qualified as a minister of Sikh Dharma,” and although we
have held “[t]he paradigmatic application of the ministerial
exception is to the employment of an ordained minister,”
Alcazar, 627 F.3d at 1291, this paradigm applies to
employment by a church, as a minister. An employee’s
status as an ordained minister, standing alone, does not
trigger the ministerial exception when that individual is
employed in a secular capacity by an entity other than a
church. Cf. id. at 1292 (“[T]he ministerial exception may not
apply to a seminarian who obtains employment with a church
outside the scope of his seminary training.”).
UI and SSSC are not churches, and although their board
members must be independently qualified as Sikh ministers,
they are not employed or held out by the organizations as
ministers. Nor is there any indication the board members
hold themselves out as religious leaders. These factors weigh
against viewing the board members as “representatives” of
PURI V. KHALSA 19
the church or as being “close to the heart of the church.”
Alcazar, 627 F.3d at 1291 (quoting Bollard, 196 F.3d at
946–47).
Finally, the pleadings do not show the board positions are
religious in substance, whether by requiring “significant
religious training,” by signifying ecclesiastical merit, or
otherwise. Hosanna-Tabor, 132 S. Ct. at 707–08. In
Hosanna-Tabor, the Court gave substantial weight to the six
years of rigorous religious training required to become a
called teacher, encompassing “college-level courses in
subjects including biblical interpretation, church doctrine, and
the ministry of the Lutheran teacher.” Id. at 707. The Court
also observed that a teacher could receive her call “only upon
election by the congregation, which recognized God’s call to
her to teach.” Id. Although it is possible that carrying out the
disputed board positions here involves similarly substantial
religious training and recognition, the record before us does
not reveal what is entailed in becoming “qualified as a
minister of Sikh Dharma” and “accept[ing] the directives and
proclamations of [Yogi Bhajan] . . . as such teachings, values,
and directives are understood by the Siri Sikdar Sahib/a of
Sikh Dharma,” nor does the record establish any functional
connection between the duties of a board member and the
religious criteria for selection. Therefore, in construing the
allegations of material fact in the light most favorable to the
plaintiffs, see Daniels-Hall, 629 F.3d at 998, we do not
assume the board positions are substantively religious on this
motion to dismiss.
Absent any allegation that board members have
ecclesiastical duties or are held out to the community as
religious leaders, and with scant pleadings on the religious
requirements for the positions, we agree with the plaintiffs
20 PURI V. KHALSA
that it is not apparent on the face of the complaint that the
disputed board positions are “ministerial.” Whereas the
ministerial exception typically applies to those who are
employed by a church to minister to the faithful, this case
appears to concern board members who, in that capacity, are
neither employed by a church nor employed to minister to the
faithful. We do not foreclose the defendants from ultimately
establishing that the ministerial exception applies, but the
factual allegations in the complaint are too far removed from
the core of the exception for us to conclude at this stage of the
proceedings that the exclusion of the plaintiffs from the board
positions is a “protected employment decision” falling within
the ministerial exception affirmative defense.
II.
Given the defendants cannot at this point rely on the
ministerial exception to bar the plaintiffs’ claims, we next
consider whether other principles of the Free Exercise and
Establishment Clauses nonetheless preclude the courts’
involvement in the internal affairs of UI and SSSC under
what we have previously termed the “doctrine of
ecclesiastical abstention.” Paul v. Watchtower Bible & Tract
Soc’y of N.Y., Inc., 819 F.2d 875, 878 n.1 (9th Cir. 1987).
The plaintiffs do not dispute UI and SSSC are religious
organizations protected by the religion clauses of the First
Amendment, but they contend the district court can resolve
this case without encroaching on that protection.
A.
Long before it formally recognized a ministerial
exception, the Supreme Court developed a doctrine, grounded
originally in common law but later in the First Amendment,
PURI V. KHALSA 21
“limiting the role of civil courts in the resolution of religious
controversies that incidentally affect civil rights.” Serbian E.
Orthodox Diocese for U.S. & Can. v. Milivojevich, 426 U.S.
696, 710 (1976). Under this doctrine of ecclesiastical
abstention, “a State may adopt any one of various approaches
for settling church . . . disputes so long as it involves no
consideration of doctrinal matters.” Jones v. Wolf, 443 U.S.
595, 602 (1979) (quoting Md. & Va. Eldership of Churches
of God v. Church of God at Sharpsburg, Inc., 396 U.S. 367,
368 (1970) (Brennan, J., concurring)). The Supreme Court
has recognized two principal approaches to deciding church
disputes without “jeopardiz[ing] values protected by the First
Amendment.” Presbyterian Church in U.S. v. Mary
Elizabeth Blue Hull Mem’l Presbyterian Church, 393 U.S.
440, 449 (1969).
The first, derived from Watson v. Jones, 80 U.S.
(13 Wall.) 679 (1872), and its progeny, is simply to “accept[]
the decision of the established decision-making body of the
religious organization.” Maktab Tarighe Oveyssi Shah
Maghsoudi, Inc. v. Kianfar, 179 F.3d 1244, 1248 (9th Cir.
1999).
[W]here resolution of the disputes cannot be
made without extensive inquiry by civil courts
into religious law and polity, the First and
Fourteenth Amendments mandate that civil
courts shall not disturb the decisions of the
highest ecclesiastical tribunal within a church
. . . but must accept such decisions as binding
on them, in their application to the religious
issues of doctrine or polity before them.
22 PURI V. KHALSA
Milivojevich, 426 U.S. at 709. But, recognizing that
deference can sometimes lead to entanglement of civil courts
in ecclesiastical issues and that some church disputes can be
resolved by application of solely secular legal rules, the Court
has also articulated an alternative to the Watson approach it
has termed the “neutral principles of law” approach. See
Jones, 443 U.S. at 602, 605.
1.
The Court first considered judicial intervention in church
disputes in Watson, when it was asked to resolve which of
two factions rightfully controlled the property of a local
Presbyterian church. See 80 U.S. (13 Wall.) at 681. Ruling
on common law grounds, the Court concluded “a broad and
sound view of the relations of church and state under our
system of laws” requires civil courts to defer to the
determinations of a church’s highest ecclesiastical authority
on “questions of discipline, or of faith, or ecclesiastical rule,
custom, or law.” Id. at 727.
The Court later applied the Watson rule to an individual’s
claim of entitlement to a chaplaincy in the Roman Catholic
Church. See Gonzalez, 280 U.S. at 10–11. Although the
plaintiff was entitled to the position under the terms of a will
establishing the chaplaincy, the archbishop had declined to
appoint the plaintiff because he lacked the qualifications for
the position as prescribed by canon law. Id. at 17–18. The
Court explained:
Because the appointment is a canonical act, it
is the function of the church authorities to
determine what the essential qualifications of
a chaplain are and whether the candidate
PURI V. KHALSA 23
possesses them. In the absence of fraud,
collusion, or arbitrariness, the decisions of the
proper church tribunals on matters purely
ecclesiastical, although affecting civil rights,
are accepted in litigation before the secular
courts as conclusive, because the parties in
interest made them so by contract or
otherwise.
Id. at 16.
The Supreme Court subsequently adopted the holdings of
Watson and Gonzalez as a constitutional rule insofar as they
pertained to the “[f]reedom to select the clergy,” explaining
that a church’s freedom to do so, “where no improper
methods of choice are proven, . . . must now be said to have
federal constitutional protection as a part of the free exercise
of religion against state interference.” Kedroff, 344 U.S. at
116; see also id. at 116 n.23 (quoting Gonzalez, 280 U.S. at
16–17). Under this principle of noninterference, extended to
cover judicial action in Kreshik v. Saint Nicholas Cathedral,
363 U.S. 190, 191 (1960) (per curiam), civil courts may not
“[b]y fiat . . . displace[] one church administrator with
another” and thereby “pass[] the control of matters strictly
ecclesiastical from one church authority to another.” Kedroff,
344 U.S. at 119. Doing so would “intrude[] for the benefit of
one segment of a church the power of the state into the
forbidden area of religious freedom contrary to the principles
of the First Amendment.” Id.
The Supreme Court’s early church dispute cases
embraced “a spirit of freedom for religious organizations, an
independence from secular control or manipulation – in short,
power to decide for themselves, free from state interference,
24 PURI V. KHALSA
matters of church government as well as those of faith and
doctrine.” Id. at 116. This deferential doctrine recognizes
that “First Amendment values are plainly jeopardized when
church [disputes are] made to turn on the resolution by civil
courts of controversies over religious doctrine and practice.”
Presbyterian Church, 393 U.S. at 449.
This does not mean, however, that civil courts have no
role in disputes involving religious organizations. Unlike the
ministerial exception, which completely bars judicial inquiry
into protected employment decisions, the ecclesiastical
abstention doctrine is a qualified limitation, requiring only
that courts decide disputes involving religious organizations
“without resolving underlying controversies over religious
doctrine.” Kianfar, 179 F.3d at 1248 (quoting Presbyterian
Church, 393 U.S. at 448).
2.
The Court introduced the neutral-principles approach in
the context of a property dispute between two local churches
that sought to withdraw from the national Presbyterian
Church in the United States. See Presbyterian Church,
393 U.S. at 441–43. Presbyterian Church held that Georgia’s
departure-from-doctrine rule, an alternative to the Watson
approach never endorsed by the Court but nonetheless
followed by some states, “require[d] the civil courts to engage
in the forbidden process of interpreting and weighing church
doctrine” and was therefore unconstitutional. Id. at 451. In
so holding, the Court recognized “the First Amendment
severely circumscribes the role that civil courts may play in
resolving church property disputes.” Id. at 449. But the Court
continued:
PURI V. KHALSA 25
It is obvious, however, that not every civil
court decision as to property claimed by a
religious organization jeopardizes values
protected by the First Amendment. Civil
courts do not inhibit free exercise of religion
merely by opening their doors to disputes
involving church property. And there are
neutral principles of law, developed for use in
all property disputes, which can be applied
without ‘establishing’ churches to which
property is awarded.
Id.
A year later, in Maryland & Virginia Eldership, the Court
approved the Maryland high court’s use of the neutral-
principles approach to resolve a church property dispute
between a regional church and two secessionist
congregations. See 396 U.S. at 367–68 (per curiam). The
Maryland Court of Appeals “relied upon provisions of state
statutory law governing the holding of property by religious
corporations, upon language in the deeds conveying the
properties in question to the local church corporations, upon
the terms of the charters of the corporations, and upon
provisions in the constitution of the General Eldership
pertinent to the ownership and control of church property.”
Id. at 367 (footnote omitted) (citing 254 A.2d 162 (Md.
1969)). The Court rejected the petitioners’ argument that this
application of neutral state law principles “deprived the
General Eldership of property in violation of the First
Amendment” and dismissed the appeal for want of a
substantial federal question, because “the Maryland court’s
resolution of the dispute involved no inquiry into religious
doctrine.” Id. at 367–68.
26 PURI V. KHALSA
In a concurrence to the per curiam opinion in Maryland
& Virginia Eldership later drawn on by a majority of the
Court in Jones v. Wolf, see 443 U.S. at 602–03, Justice
Brennan explained, “a State may adopt any one of various
approaches for settling church property disputes so long as it
involves no consideration of doctrinal matters, whether the
ritual and liturgy of worship or the tenets of faith.” Md. &
Va. Eldership, 396 U.S. at 368 (Brennan, J., concurring).
“Thus the States may adopt the approach of Watson v. Jones,
and enforce the property decisions made” by a church’s
highest ecclesiastical authority. Id. at 368–69 (citation
omitted) (citing Watson, 80 U.S. (13 Wall.) at 722, 724). But
“the use of the Watson approach is consonant with the
prohibitions of the First Amendment only if the appropriate
church governing body can be determined without the
resolution of doctrinal questions and without extensive
inquiry into religious policy.” Id. at 370. Alternatively,
“‘[n]eutral principles of law, developed for use in all property
disputes,’ provide another means for resolving litigation over
religious property.” Id. (citation omitted) (quoting
Presbyterian Church, 393 U.S. at 449). For example, when
“the identity of the governing body or bodies that exercise
general authority within a church is a matter of substantial
controversy,” courts can avoid becoming impermissibly
entangled in that ecclesiastical dispute by “determin[ing]
ownership by studying deeds, reverter clauses, and general
state corporation laws.” Id. at 369–70.
In Jones, the Court definitively held that “civil courts,
consistent with the First and Fourteenth Amendments to the
Constitution, may resolve [church property] dispute[s] on the
basis of ‘neutral principles of law.’” 443 U.S. at 597. The
Court observed:
PURI V. KHALSA 27
The primary advantages of the neutral-
principles approach are that it is completely
secular in operation, and yet flexible enough
to accommodate all forms of religious
organization and polity. The method relies
exclusively on objective, well-established
concepts of trust and property law familiar to
lawyers and judges. It thereby promises to
free civil courts completely from
entanglement in questions of religious
doctrine, polity, and practice.
Id. at 603. The Court recognized “the application of the
neutral-principles approach is [not] wholly free of difficulty”
as it may, for instance, “require[] a civil court to examine
certain religious documents, such as a church constitution, for
language of trust in favor of the general church.” Id. at 604.
“In undertaking such an examination, a civil court must take
special care to scrutinize the document in purely secular
terms, and not to rely on religious precepts.” Id.
Furthermore, “there may be cases where the deed, the
corporate charter, or the constitution of the general church
incorporates religious concepts in the provisions relating to
the ownership of property,” and, “[i]f in such a case the
interpretation of the instruments of ownership would require
the civil court to resolve a religious controversy, then the
court must defer to the resolution of the doctrinal issue by the
authoritative ecclesiastical body.” Id. (citing Milivojevich,
426 U.S. at 709). Despite these challenges, the Court
concluded “[o]n balance, . . . the promise of nonentanglement
and neutrality inherent in the neutral-principles approach
more than compensates for what will be occasional problems
in application.” Id.
28 PURI V. KHALSA
Property disputes have proved especially amenable to
application of the neutral-principles approach. See Kianfar,
179 F.3d at 1249. But we are unaware of any authority or
reason precluding courts from deciding other types of church
disputes by application of purely secular legal rules, so long
as the dispute does not fall within the ministerial exception
and can be decided “without resolving underlying
controversies over religious doctrine.” Presbyterian Church,
393 U.S. at 449; see also Milivojevich, 426 U.S. at 710 (“This
principle applies with equal force to church disputes over
church polity and church administration.”). Indeed, “we must
be careful not to deprive religious organizations of all
recourse to the protections of civil law that are available to all
others,” because “[s]uch a deprivation would raise its own
serious problems under the Free Exercise Clause.” Kianfar,
179 F.3d at 1248.
B.
1.
The Supreme Court has made clear that “a State may
adopt any one of various approaches for settling church . . .
disputes so long as it involves no consideration of doctrinal
matters.” Jones, 443 U.S. at 602 (quoting Md. & Va.
Eldership, 396 U.S. at 368 (Brennan, J., concurring)). It is
thus constitutionally permissible for a court to apply either
the Watson approach (deferring to a church’s highest
ecclesiastical authority) or the neutral-principles approach to
such disputes, as long as the court decides the dispute
“without resolving underlying controversies over religious
doctrine.” Kianfar, 179 F.3d at 1248 (quoting Presbyterian
Church, 393 U.S. at 449). But we are not without further
PURI V. KHALSA 29
guidance in deciding the proper approach for cases litigated
in federal court.
First, Jones suggested a clear preference for the neutral-
principles approach, noting that its “promise[] to free civil
courts completely from entanglement in questions of religious
doctrine, polity, and practice” outweighed occasional
difficulties in its application. Jones, 443 U.S. at 603–04.
Following Jones, we held that where a religious entity has
adopted civil “legal structures, it is incumbent upon the civil
court . . . to apply to those structures the secular law that
governs them.” See Kianfar, 179 F.3d at 1250.4
Second, where both approaches are available as a
constitutional matter, we have made clear a court may apply
the neutral-principles approach even though the Watson
approach would lead to a contrary result. See id. at 1249
(discussing the Supreme Court’s approval of a state approach
that required a decision “by neutral principles even though
the outcome might contravene the decision of the hierarchical
church” (citing Jones, 443 U.S. at 604–06)).
4
This holding follows from a principle announced in Watson itself.
See Jones, 443 U.S. at 603 n.3 (“[E]ven in Watson v. Jones, . . . the
Court[] stated that, regardless of the form of church government, it would
be the ‘obvious duty’ of a civil tribunal to enforce the ‘express terms’ of
a deed, will, or other instrument of church property ownership.” (quoting
Watson, 80 U.S. (13 Wall.) at 722–23)). The Court’s endorsement of the
neutral-principles approach in Jones significantly buttressed this principle,
and further supported its application where the “legally cognizable
form[s]” or structures are embedded within church-related documents,
such as corporate charters or even church constitutions. See Jones,
443 U.S. 603, 606.
30 PURI V. KHALSA
Third, the Watson approach is not appropriate when “the
nature of the religious organization or the identity of its
decision-making body is disputed on the basis of religious
doctrine.” Id. at 1248–49. Where the “locus of control . . .
[is] ambiguous,” Watson deference “would appear to require
‘a searching and therefore impermissible inquiry into church
polity.’” Jones, 443 U.S. at 605 (quoting Milivojevich,
426 U.S. at 723).
Finally, our general preference in federal cases for
resolving claims by applying neutral principles is further
supported here by the fact that most claims in this case are
based on state law. Oregon law would call for application of
the state’s neutral-principles approach if this matter were
before a state court. See Hope Presbyterian Church of Rogue
River v. Presbyterian Church (U.S.A.), 291 P.3d 711, 720–21
(Or. 2012) (outlining a neutral-principles approach after
“reexamin[ing] the proper methodology for resolving church
property disputes in Oregon” in light of the “new legal
context for evaluating church property disputes under the
First Amendment” provided by Jones).5
5
The Supreme Court has not outlined one specific neutral-principles
approach, and there may be significant variation in the approaches of
various states. See Jones, 443 U.S. at 599–610; see also Church of God
in Christ, Inc. v. Graham, 54 F.3d 522, 526–27 (8th Cir. 1995) (applying
Missouri’s neutral-principles approach and refusing to apply an element
of Michigan’s disparate approach). Additionally, other federal circuit
courts have considered the appropriate state law to apply to resolve church
property disputes when sitting in diversity. See Scotts African Union
Methodist Protestant Church v. Conference of African Union First
Colored Methodist Protestant Church, 98 F.3d 78, 92–94 (3d Cir. 1996)
(applying New Jersey law, as predicted by federal court, to follow the
state’s neutral-principles approach); Askew v. Trs. of Gen. Assembly of
Church of the Lord Jesus Christ of the Apostolic Faith Inc., 684 F.3d 413,
419 (3d Cir. 2012) (noting “Pennsylvania courts opt to apply neutral civil
PURI V. KHALSA 31
In light of the preference to apply neutral principles to
enforce secular rights where possible, the Oregon state law
character of most of the claims in this case, and Oregon’s
adoption of the neutral-principles approach, we proceed to
determine whether such an approach may be constitutionally
applied in this case.
2.
It appears a neutral-principles approach “may resolve . . .
the disputed . . . issues without significant constitutional
difficulties,” and is a proper means of resolving this dispute.
Kianfar, 179 F.3d at 1249. The plaintiffs do not seek
recourse to civil courts for resolution of a controversy over
religious doctrine. Nor do they ask civil courts to decide
whether a religious organization properly applied
ecclesiastical rules in settling a leadership dispute, as was true
in Milivojevich, 426 U.S. at 708, and of the one request for
relief we held could not be decided by neutral principles in
Kianfar, 179 F.3d at 1250. Rather, the plaintiffs here ask the
courts to decide what amounts to a secular factual question:
under Oregon law and the secular governing documents of
UI, an Oregon nonprofit limited liability company, and SSSC,
an Oregon nonprofit religious corporation, were the plaintiffs
elected or designated to the disputed board positions? This
question is quintessentially “susceptible to decision by neutral
principles.” Id. at 1249.
law principles whenever possible to resolve such cases” before
determining that such approach was improperly applied to an
ecclesiastical question). Here, as in Kianfar, we do not seek to resolve
which neutral-principles approach may be properly applied. Rather, our
review is limited to the threshold constitutional question of whether the
issues raised can be decided at all without violating the First Amendment.
See Kianfar, 179 F.3d at 1248.
32 PURI V. KHALSA
At this stage, the parties do not contest whether the
plaintiffs meet the religious eligibility requirements for the
disputed board positions, and the defendants “do not offer a
religious justification” for their failure to seat the plaintiffs on
the boards. Bollard, 196 F.3d at 947. The dispute, which
“concern[s] the [d]efendants’ actions, not their beliefs,” turns
entirely on “what the [defendants] did, . . . and the texts
guiding [their] actions can be subjected to secular legal
analysis.” Elvig, 375 F.3d at 963, 968. As in Bollard, “[t]his
is a restricted inquiry. Nothing in the character of th[e]
defense will require a jury to evaluate religious doctrine or
the ‘reasonableness’ of the religious practices followed . . . .
Instead, the jury must make [only] secular judgments . . . .”
Bollard, 196 F.3d at 950; see also Elvig, 375 F.3d at 963. As
this dispute has been presented to us, it appears the district
court can resolve it “by relying on state statutes . . . and the
terms of corporate charters of religious organizations.”
Kianfar, 179 F.3d at 1249 (citing Md. & Va. Eldership,
396 U.S. at 367). Thus, there is “no danger that, by allowing
this suit to proceed, we will thrust the secular courts into the
constitutionally untenable position of passing judgment on
questions of religious faith or doctrine.” Bollard, 196 F.3d at
947. Under these circumstances, the availability of the
neutral-principles approach obviates the need for
ecclesiastical abstention.
C.
Even if ecclesiastical abstention would otherwise preclude
resort to civil courts, the plaintiffs contend this dispute is
susceptible to judicial review under the so-called “fraud or
collusion” exception. See Askew, 684 F.3d at 418, 420 (“A
doctrinally grounded decision made during litigation to
insulate questionable church actions from civil court review
PURI V. KHALSA 33
may indeed raise an inference of fraud or bad faith,” and
“[u]nder those circumstances, the integrity of the judicial
system may outweigh First Amendment concerns such that a
civil court may inquire into the decision.”). Because we hold
it is not apparent from the complaint that ecclesiastical
abstention applies, we have no occasion to address the fraud
or collusion exception here.
CONCLUSION
“[A]pplying any laws to religious institutions necessarily
interferes with the unfettered autonomy churches would
otherwise enjoy, [but] this sort of generalized and diffuse
concern for church autonomy, without more, does not exempt
them from the operation of secular laws.” Bollard, 196 F.3d
at 948. As this case has been presented to us, the defendants
have not established that the plaintiffs’ claims are barred by
the ministerial exception, and the ecclesiastical abstention
doctrine does not apply because the dispute is amenable to
resolution by application of neutral principles of law. Thus,
the district court erred in dismissing the plaintiffs’ claims
under the First Amendment.
For the reasons stated here and in the concurrently filed
memorandum disposition, the judgment of the district court
is vacated in part and affirmed in part, and the case is
remanded to the district court.
VACATED IN PART, AFFIRMED IN PART AND
REMANDED.
Each party shall bear its own costs on appeal.