LITIGATION UPDATE, 2 JULY 2020

There was a noteworthy development in the church litigation yesterday. The Episcopal diocese of South Carolina filed "Appellees' Brief" with the United States Court of Appeals for the Fourth Circuit. This was the EDSC response to the brief of the party making the appeal, the disassociated organization calling itself the Anglican Diocese of South Carolina. The ADSC filed its brief with the federal appeals court on April 30, 2020.
[Note. Yesterday's brief is on the Internet, but is behind the pay wall of "Pacer." I cannot copy it here.]

A short recap:

Sept. 19, 2019, U.S. District Court Judge Richard Gergel issued "Order and Opinion" recognizing 1-the Episcopal Church diocese as the only legal heir of the historic (pre-schism) diocese, 2-Church ownership of names, marks, emblems under the Lanham Act (trademark), and 3-the Episcopal Church as hierarchical. Furthermore, Gergel issued a permanent injunction banning the new organization from publicly claiming to be in any way the successor of the historic diocese.

Oct. 7, 2019, ADSC announced it would appeal the Sept. 19 decision to the U.S. Court of Appeals.

Dec. 18, 2019, Judge Gergel denied a stay to ADSC pending the appeal. He also ordered enforcement of the permanent injunction of Sept. 19.

Jan. 14, 2020, the U.S. Court of Appeals, Fourth Circuit, denied ADSC's petition for a stay pending the appeal.

Apr. 30, 2020, ADSC submitted "Brief of Appellants" to the U.S. Court of Appeals.

July 1, 2020, EDSC submitted "Appellees' Brief" to the U.S. Court of Appeals.

In an appeal of a judge's order, the onus is on the party making the appeal to prove that the original order was erroneous and must be changed by the higher court. In my reading of ADSC's brief of April 30, I found nothing to show why Gergel's decision should be overturned. It was the same old arguments we have heard from day one, all those seven and a half years ago: the diocese properly seceded from the Episcopal Church, the diocese is the only legitimate heir of the historic diocese, the diocese owns the state trademarks, episcopal church is a generic term, the diocese did not violate the injunction. The paper presented only weak, unconvincing evidence supporting these assertions. The brief certainly presented nothing to compel a court to overturn Gergel's powerful decision.

The EDSC brief of yesterday effectively emphasized several important points that supported Gergel's Sept. 19 decision. In my view, the key point of Gergel's decision, and of yesterday's brief, is the declaration that the Episcopal Church is an hierarchical institution. This means it is protected by the First Amendment from interference by the civic state. Since TEC is hierarchical, it has authority over the dioceses. When the officers of the pre-schism diocese left TEC, the Church reorganized the historic diocese under new officers. The people who left TEC have no right to claim ownership of the historic diocese. Moreover, a majority of justices of the South Carolina Supreme Court declared that the Church diocese was the heir of the historic diocese and the new organization had no right to it.

In yesterday's brief the lawyers wrote:

the First Amendment independently requires this Court to accept the hierarchical Church's determination that TECSC is the continuing Historic Diocese... (p. 31)

The EDSC lawyers went on to lay out four main arguments in their brief supporting Judge Gergel's decision:

1-Under the First Amendment and the SCSC decision, the Church diocese is the only owner of the service marks.

2-The disassociated organization violated the Lanham Act by using marks owned by TEC.

3-The disassociated organization violated state laws by using marks that belonged to the historic diocese.

4-The district court was right to issue and to enforce an injunction stopping the disassociated organization from using marks that did not belong to them.

Still, it seems to me the whole case of the Church side rests on hierarchy. If the appeals court upholds Gergel, this will seal the deal. Under federal jurisprudence, and federal takes precedence over state, the Episcopal Church will be recognized in the courts as an hierarchical institution. This would mean it has control over its dioceses. Of course, if ADSC loses in the appeals court, it could appeal its loss to the U.S. Supreme Court. So far, SCOTUS has shown no interest in wading into Episcopal Church business.

What next in the federal appeals court? Next, the ADSC will have an opportunity to make a reply to yesterday's paper of EDSC. The deadline for this is July 22, 2020. I will return with commentary on this when it appears.

After that, the appeals court in Richmond VA will decide whether to hold a hearing or to go straight to a decision. If it holds a hearing, it would be livestreamed by audio. In each of the last few times the appeals court took up the church cases from SC, a panel of three judges heard oral arguments and issued a written decision later. So far, all decisions from the U.S. Court of Appeals have been favorable to the Episcopal Church. There is no reason to think this will change. Judge Gergel wrote his Sept. 19 decision to make it virtually appeal-proof. He cited case after case in which the Fourth Circuit had already decided on certain a propos points. In other words, he has already done the work for the appeals judges.

In my view, there is very little chance the appeals court will change Gergel's landmark decision. The sooner the Church gets over this roadblock, the better. Of course, the losing side will not go down easily. They are throwing up every roadblock imaginable to forestall the inevitable. Eventually they will run out of options. The breakaways have already lost the war, which they themselves started, whether they want to recognize reality or not. The Episcopal Church won in state and federal courts.