A Second Federal Appeals Court Holds That the Holy See Can Be Sued for Harm Caused by Pedophile Priests
A few weeks ago, I wrote about a Sixth Circuit decision which held that the Foreign Sovereign Immunities Act ("FSIA") did not deprive a court of jurisdiction over certain causes of action against the Holy See for harm caused by bishops, archbishops, and other US supervisory employees who failed to report or warn about pedophile priests. On Tuesday, the Ninth Circuit issued a decision that -- although it refused to find jurisdiction for the acts of the Holy See's US supervisory employees -- found jurisdiction over the Holy See for respondeat superior liability for the conduct of a priest/employee who admitted to acts of sexual abuse on parishioners and students. See Doe v. Holy See, Nos. 06-35563, 06-35587 (9th Cir. Mar. 3, 2009).
This is the second federal appellate decision holding that the Holy See itself may be held to account in US courts for sexual abuse committed by Catholic Church employees in the United States. Given how the financial status of some Catholic dioceses has impacted the progress of sexual abuse litigation in U.S. courts, the cumulative effect of the Sixth and Ninth Circuit's decisions -- providing jurisdiction over the ultimate "deep pocket" defendant -- may be to breathe new life into priest sexual abuse litigation and drive settlement values higher.
In Doe, Father Andrew Ronan had admitted to molesting a minor as parish priest in the Archdiocese of Armagh, Ireland. He was removed from his position and placed in the employ of the Archbishop of Chicago at St. Philip's High School, where he admitted to molesting at least three male students. The Holy See then allegedly placed Father Ronan in a parish priest position in Portland, Oregon. Plaintiff alleged that he came to know Father Ronan as his "priest, counselor, and spiritual advisor," and that using his position of trust and authority, Father Ronan sexually abused Plaintiff on repeated occasions "in several places including the monastery and surrounding areas." Slip. op. at 2250. Doe sued the Holy See, the Archdiocese, the Chicago Bishop, and the Order of Friar Servants (of which Ronan was a member). The Holy See moved to dismiss, claiming that the court lacked jurisdiction over it under the Foreign Sovereign Immunities Act. The District Court held that the "tortious act" exception to the FSIA applied, giving it jurisdiction over all of Doe's claims except the claim for fraud. The District Court also had held that the "commercial activity" exception to the FSIA was inapplicable to the conduct pled in the complaint.
The Ninth Circuit partially affirmed, based on a detailed analysis of the FSIA. The Doe decision is particularly interesting because of the split that arose in the three-judge panel regarding the applicability of the "commercial activity" exception. The majority per curiam opinion holds that the court did not have appellate jurisdiction to consider the "commercial activity" exception argument because it was the subject of Doe's cross-appeal and did not independently meet the requirements of the collateral order doctrine.
The Dissent: The Commercial Activity Exception
But in a well-reasoned dissent, Judge Marsha Berzon argued that the court had appellate jurisdiction to consider the argument because it was an alternative ground upon which they could affirm the District Court's finding of jurisdiction. Slip op. at 2583, 2585-87 (Berzon, J., dissenting). Judge Berzon's dissent lays out the broadest reading yet of jurisdiction over the Holy See, using the "commercial activity" exception. According to Judge Berzon, Father Ronan met all of the requirements for the commercial activity exception: he was employed in a non-sovereign capacity with no sovereign duties, and the plaintiff's negligence claims were based on Father Ronan's employment relationship with the Holy See.
Judge Berzon addressed, in her dissent, the question whether Father Ronan's pastoral duties could really be deemed "commercial activity" under the FSIA. She observed that "a foreign state engages in 'commercial' activities when it 'do[es] not exercise powers peculiar to sovereigns,' but rather 'exercise[s] only those powers that can be exercised by private citizens.'" Slip. op. at 2589 (quoting Argentina v. Weltover, 504 U.S. 607, 614 (1992)). The question, she explained, is not whether the sovereign is acting with profit motives or so-called sovereign objectives, but rather whether the type of activity it engaged in is one by which a private party engages in commerce. Id. Indeed, in Weltover, the government had not made a profit, and the court noted that "'[e]ngaging in a commercial act does not require the receipt of fair value, or even compliance with the common law requirements of consideration.'" Id. (quoting Weltover).
Looking at the employment relationship, then, Judge Berzon explained:
In sum, a foreign state engages in commercial activities when it engages in acts that any private citizen has the power to undertake, regardless of the state's motive or the possibility of making a profit therefrom. Applying the Weltover definition of "commercial activity," this Circuit has repeatedly held that an employment relationship between a foreign sovereign and its employee constitutes commercial activity, so long as the employee is not a civil service, diplomatic, or military employee.
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But on the allegations in the complaint, Ronan was not a civil service, diplomatic, or military employee . . . Providing religious, educational, and counseling services is not a peculiarly governmental function; it is something that non-governmental employers can do.
To reach this conclusion, I do not rely at all on the consideration that "churches receive financial support from their parishioners." Maj. Op. at 2561. The fact that Ronan's provision of pastoral services coincides with and depends upon his parishioners giving donations is neither necessary nor sufficient to show that the Holy See's employment of Ronan is a commercial activity under Weltover's nature-not-purpose test. Instead, the critical factor in the commercial activity analysis in this case is that the Holy See's employment activities alleged in Doe's complaint are not distinctly sovereign in nature -- that they are the sort of functions that private parties, not just sovereign governments, can perform.
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. . . The FSIA's purpose is not to insulate religious institutions from suit; it juxtaposes commercial activities not to religious activities, but to governmental activities. The Holy See differs from other foreign states in the nature of the non-sovereign activities it carries out and, in all likelihood, in the ratio of its non-sovereign activities to its sovereign activities. But it is like other sovereigns in the respect essential here: It engages in a range of non-sovereign activities in the United States, and the FSIA's commercial activity exception lifts the shield of immunity from such non-sovereign activities.
Id. at 2590-93 (citations omitted).
Judge Berzon's dissent drew a sharp rebuttal from Judge Ferdinand Fernandez, who wrote a concurrence because he was "loath to leave her disquisition standing alone." According to Judge Fernandez, "Doe's claim that church functions are simply commercial transactions because parishioners do give donations to the church bespeaks the veriest cynicism about religion and a church's position within religion." Slip op. at 2602 (Fernandez, J., concurring).
Judge Fernandez believed that the fundamental problem with Judge Berzon's analysis stemmed from the fact that the Holy See is an unusual type of foreign sovereign that engages in a significant amount of non-commercial, non-sovereign activities:
I fail to see how engaging in providing religious counseling is "trade and traffic or commerce." Id. Nor, by the way, can a mere private actor give priestly counseling or consolation to a believer. This does not require a focus on purpose; it goes to the very nature of the religious activity itself. . . . Again, Holy See has not acted in the market at all. It has simply provided religious counseling to a church communicant, a service that this unique sovereign entity is designed for.
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. . . We hierophants of the law are adept at redefining ordinary concepts, but it is no more appropriate to declare that religious services are commercial activities than it would be to declare that ponies are small birds.
Id. at 2604-05 (citations omitted).
The Court's Holding: The Tortious Act Exception
As noted above, the majority held that it did not have appellate jurisdiction to consider the "commercial activity" exception to the FSIA. Thus, it confined its analysis to the "tortious act" exception.
To begin with, the court had to determine which acts were attributable to the Holy See in conducting the jurisdictional analysis. It followed the presumption that various organizations have separate juridical status, and thus refused to attribute the actions of the archdiocese or the bishops to the Holy See. Indeed, it noted that the standard it applied is "most similar to the 'alter ego' or 'piercing the corporate veil' standards applied in many state courts to determine whether the actions of a corporation are attributable to its owners." Slip op. at 2569. But the complaint had done an effective job of pleading that the Holy See itself employed Father Ronan and placed him in positions, so the court attributed those acts to the Holy See for the purpose of its jurisdictional analysis. Slip op. at 2563, 2570.
The court then performed its analysis of the tortious act exception. It concluded that:
Doe's respondeat superior claim based on Ronan's actions comes within the tortious act exception. Doe has clearly alleged that Ronan was an employee of the Holy See, acting within the scope of his employment, when he molested Doe. We conclude, however, that Does claims against the Holy See for negligent retention and supervision and failure to warn cannot be brought under the tort exception because they are barred by the FSIA's exclusion for discretionary functions, section 1605(a)(5)(A).
Slip op. at 2571.
In reaching its conclusion -- which differs from the Sixth Circuit's decision on the issue of allowing actions based on negligent supervision and failure to warn -- the Ninth Circuit took care to note that this plaintiff did not plead any policy that was specific and mandatory on the Holy See and failed to describe any documents, promulgations or orders. Slip op. at 2576. In contrast, the Sixth Circuit's plaintiff had described a "1962 Policy," including the document embodying it and the approvals it had received.
But the primary difference between the Ninth Circuit's opinion and the Sixth Circuit's opinion was the finding that the Holy See could be vicariously liable for the actions of the pedophile priest himself.
Cases seeking recovery for priest sexual abuse often have difficulties with statutes of limitations, proof, and the inability to meet the predominance and superiority elements of the class action rule. But if the Sixth and Ninth Circuit's recent opinions mean that the Holy See can now be held into these cases regularly, this has the potential to fundamentally change the course of this type of litigation.