Pastor David Bacon, Pastor Timothy Hepner, Ruth Dold, and Sharon Hvam, individually and as representatives of a class of similarly situated persons, and on behalf of the Evangelical Lutheran Church in America Retirement Plan and the ELCA Retirement Plan for the Evangelical Lutheran Good Samaritan Society v. Board of Pensions of the Evangelical Lutheran Church in America (d/b/a Portico Benefit Services)
Minnesota Court of Appeals
Pastor David Bacon, Pastor Timothy Hepner, Ruth Dold, and Sharon Hvam, individually and as representatives of a class of similarly situated persons, and on behalf of the Evangelical Lutheran Church in America Retirement Plan and the ELCA Retirement Plan for the Evangelical Lutheran Good Samaritan Society v. Board of Pensions of the Evangelical Lutheran Church in America (d/b/a Portico Benefit Services)
Opinion
This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A15-1999
Pastor David Bacon, Pastor Timothy Hepner,
Ruth Dold, and Sharon Hvam, individually and as representatives
of a class of similarly situated persons,
and on behalf of the Evangelical Lutheran Church in America Retirement Plan
and the ELCA Retirement Plan for the Evangelical Lutheran Good Samaritan Society,
Appellants,
vs.
Board of Pensions of the Evangelical Lutheran
Church in America (d/b/a Portico Benefit Services),
Respondent.
Filed July 25, 2016
Reversed and remanded
Reilly, Judge
Hennepin County District Court
File No. 27-CV-15-3425
Charles N. Nauen, Lockridge Grindal Nauen P.L.L.P., Minneapolis, Minnesota; and
Michael A. Wolff (pro hac vice), Schlichter, Bogard & Denton LLP, St. Louis, Missouri
(for appellants)
Brian W. Thomson, Liz Kramer, Kadee J. Anderson, Stinson Leonard Street LLP,
Minneapolis, Minnesota; and
Deborah S. Davidson (pro hac vice), Morgan, Lewis & Bockius LLP, Chicago, Illinois (for
respondent)
Eric D. McArthur (pro hac vice), Sidley Austin LLP, Washington, D.C.; and
Steven L. Severson, Aaron D. Van Oort, Blake J. Lindevig, Faegre Baker Daniels LLP,
Minneapolis, Minnesota (for amicus curiae Church Alliance)
Considered and decided by Reilly, Presiding Judge; Halbrooks, Judge; and Stauber,
Judge.
UNPUBLISHED OPINION
REILLY, Judge
Appellants challenge the district court’s dismissal of their claims relating to
respondent’s management of retirement plans. Appellants assert that the district court erred
by determining that adjudication of their claims would involve excessive entanglement
with religion and thus that the district court lacked jurisdiction over the claims. Because
the court has jurisdiction over appellants’ claims, and some of appellants’ claims can be
resolved using neutral principles of law, we reverse and remand.
FACTS
Appellants (Pastor David Bacon, Pastor Timothy Hepner, Ruth Dold, and Sharon
Hvam) are participants in retirement plans maintained and administered by respondent, the
Board of Pensions of the Evangelical Lutheran Church in America (d/b/a Portico Benefit
Services) (Portico). Pastor Bacon and Pastor Hepner are participants in the Evangelical
Lutheran Church in America Retirement Plan (the ELCA Plan). Dold and Hvam are lay
participants in the Retirement Plan for the Evangelical Lutheran Good Samaritan Society
(the GSS Plan).1 Appellants seek to bring an action, individually and as representatives of
a class, against Portico for breach of fiduciary duty, breach of trust, and fraud and
concealment based on Portico’s administration and management of the Plans.
1
For purpose of this opinion the ELCA Plan and the GSS Plan will be referred to
collectively as the Plans.
2
Portico is a nonprofit corporation incorporated by the Evangelical Lutheran Church
in America (ELCA). The ELCA constitution establishes the responsibilities of Portico.
Portico controls and manages the operation and administration of the Plans and is the
trustee of the Plans.2 The Plans are defined-contribution plans. Plan participants can invest
in 20 funds selected and maintained by Portico. Of the 20 fund options, 8 are deemed
“social purpose funds.” The “social purpose funds invest in ways that are compatible with
the social policies of the ELCA” and use a three-pronged approach to investing which
includes “[s]hareholder advocacy,” “[s]ocial screening,” and “[p]ositive social
investments.”
The plan documents contain Portico’s requisite fiduciary duties as follows:
Each fiduciary shall discharge her/his duties with respect to the
Retirement Plan, solely in the interests of Members, and in
accordance with the following requirements:
(a) For the exclusive purpose of providing benefits to
Members and defraying reasonable expenses of administering
the Retirement Plan,
(b) With the care, skill, prudence, and diligence under
the circumstances then prevailing that a prudent person acting
in a like capacity and familiar with such matters would use in
the conduct of an enterprise of a like character and with like
aims,
(c) By diversifying the investments of the Retirement
Plan so as to minimize the risk of large losses, unless under the
circumstances it is clearly prudent not to do so, and
2
The Plans are “church plans,” and thus not subject to the Employee Retirement Income
Security Act (ERISA). 29 U.S.C. § 1003(b)(2) (2012). The Minnesota Prudent Investor
Act (MPIA) does not exempt church plans. See Minn. Stat. § 501C.0901 (Supp. 2015).
3
(d) In accordance with the provisions of this Retirement
Plan and the [Retirement Plan] Trust.
Appellants allege that Portico breached its fiduciary duty by failing to exercise
reasonable care, skill, and diligence in managing the assets of the Plans, and failing to act
in the exclusive interest of participants in the selection and retention of plan-investment
options. Appellants contend that “Portico selected and retained excessive cost, poorly-
performing ELCA investment funds that generated revenue to itself, while failing to
consider or analyze the use of superior low-cost options that were readily available to the
Plans,” and “[a] reasonable investigation would have revealed to a prudent fiduciary that
the ELCA investments were imprudent, selected and retained for reasons other than the
best interest of Plan participants, and that other alternatives would have better served
participants’ interests.” Additionally, appellants allege that “Portico received
compensation for administrative and recordkeeping services provided to the Plans in the
form of administrative expenses that were assessed against each investment option offered
in the Plans”; that “[t]he compensation that Portico received from the Plans for
administrative and recordkeeping services was and is inappropriate and/or unreasonable
for the services provided to the Plans”; and that “[a]s a result, Portico violated the
Minnesota Prudent Investor Act requirement to ensure that the costs of managing Plan
assets are appropriate and reasonable.”
Appellants allege Portico breached trust by: (1) “failing to exercise care, skill,
prudence, and diligence in the selection and retention of Plan investment options because
it selected and retained excessive cost, poorly-performing ELCA investment funds that
4
generated revenue to itself while failing to consider or analyze the use of superior low-cost
options that were readily available”; (2) “offering ELCA investment funds because they
benefited Portico instead of choosing funds for the exclusive purpose of providing benefits
to participants”; (3) “failing to defray only reasonable expenses of administering the Plans
because the compensation that Portico received from the Plans for administrative and
recordkeeping services was and is unreasonable for the services provided to the Plans”;
(4) “failing to exercise care, skill, prudence, and diligence in monitoring and negotiating
Plan expenses”; and (5) “setting its own compensation in a manner that benefited Portico
at the expense of participants.”
Finally appellants allege fraud and concealment by Portico because “Portico
intentionally concealed the excessive nature of the fees charged to the Plan by falsely
portraying them as competitive, and deliberately using for comparison [purposes] retail
funds that are far more expensive than the institutional rates readily available to large
plans.”
Portico filed a motion to dismiss the suit on the grounds that appellants’ claims are
barred by the Establishment and Free Exercise Clauses of the First Amendment to the U.S.
Constitution and the Freedom of Conscience Clause of the Minnesota Constitution because
Portico was established as a ministry by the ELCA. In October 2015, in a thorough and
thoughtful memorandum of law, the district court determined that it lacked subject-matter
jurisdiction, granted Portico’s motion, and dismissed all of appellant’s claims with
prejudice. This appeal follows.
5
DECISION
Appellants argue the district court erred in dismissing their claims because
resolution of their claims would not involve excessive entanglement in religion. At the
time the appeal was filed, Minnesota courts treated claims of religious entanglement in
violation of the First Amendment to the U.S. Constitution and the Minnesota Constitution
as challenges to the court’s subject-matter jurisdiction. See, e.g., Odenthal v. Minn.
Conference of Seventh-Day Adventists, 649 N.W.2d 426, 434, 441(Minn. 2002). However, after the parties filed their briefs, the Minnesota Supreme Court issued an opinion that clarified Minnesota courts’ analysis of what is commonly referred to as the “ecclesiastical abstention doctrine.” Pfeil v. St. Matthews Evangelical Lutheran Church,877 N.W.2d. 528, 534-35
(Minn. 2016). The supreme court concluded, based on Hosanna- Tabor Evangelical Lutheran Church & Sch. v. Equal Emp’t Opportunity Comm’n,132 S. Ct. 694
, 709 n.4 (2012), that “the ecclesiastical abstention doctrine is not a jurisdictional bar.” Pfeil,877 N.W.2d at 535
. Although in Hosanna-Tabor the United States Supreme Court treated the ecclesiastical abstention doctrine as an affirmative defense on the merits when applied to a state-law tort claim,132 S. Ct. at 709
n.4, the Minnesota Supreme Court noted that there is “some latitude to decide how the doctrine will be applied in Minnesota courts.” Pfeil,877 N.W.2d at 535
. It explained that “one possible option is to treat the doctrine as an affirmative defense on the merits,” but noted that “the doctrine could also function as a form of abstention, as one of its names implies.”Id.
The supreme court
“decline[d] to characterize the doctrine” because the distinction between an affirmative
6
defense and abstention was not briefed on appeal and was “not essential to the disposition”
of the case. Id.
Due to the timing of Pfeil, the parties did not brief the issue of how to treat the
ecclesiastical abstention doctrine. However, at oral argument the parties both suggested
that, in the present case, it would be appropriate to treat Portico’s challenge to the suit based
on the First Amendment to the U.S. Constitution and the Minnesota Constitution as an
affirmative defense on the merits. Portico contends that this court should affirm the district
court’s decision under Minnesota Rule of Civil Procedure 12.02(e) on the basis that
appellants have failed to state a claim on which relief can be granted. Appellants contend
that application of the ecclesiastical abstention doctrine to this case is better suited for
consideration after discovery on summary judgment under Minnesota Rule of Civil
Procedure 56.03.3
We now address the key question on appeal: whether the case can be decided based
on “neutral principles of law,” id.at 533 (quoting Jones v. Wolf,443 U.S. 596, 602-05
,99 S. Ct. 3020, 3025-26
(1979)), or whether resolution of the dispute requires “extensive inquiry by civil courts into religious law and polity.”Id.
(quoting Serbian E. Orthodox Diocese for the U.S. & Can. v. Milivojevich,426 U.S. 696, 709
,96 S. Ct. 2372, 2380
(1976)).
3
At oral argument the parties suggested that ecclesiastical abstention is best viewed as an
affirmative defense on the merits and not a form of abstention. The supreme court in Pfeil
left the resolution of that question for another time as do we.
7
Under the ecclesiastical abstention doctrine,
where resolution of . . . 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 of hierarchical polity, but must accept
such decisions as binding on them, in their application to the
religious issues of doctrine or polity before them.
Id.(quoting Milivojevich,426 U.S. at 709
,96 S. Ct. at 2380
). However, “the autonomy granted to religious institutions by the First Amendment is not boundless,” and “certain situations allow courts to use ‘neutral principles of law’ to resolve controversies involving religious institutions and their parishioners.”Id.
(quoting Jones,443 U.S. at 602-05
,99 S. Ct. at 3025-26
).
[A] court may decide disputes involving religious
organizations, but only if the court is able to resolve the matter
by relying exclusively on neutral principles of law, the court
does not disturb the ruling of a governing ecclesiastical body
with respect to issues of doctrine, and the adjudication does not
“interfere[ ] with an internal church decision that affects the
faith and mission of the church itself.”
Id. at 534 (alteration in original) (quoting Hosanna-Tabor, 132 S. Ct. at 707).
In reaching the conclusion that adjudication of appellants’ claims is barred by the
First Amendment, the district court relied heavily on Basich v. Bd. of Pensions, Evangelical
Lutheran Church in Am., 540 N.W.2d 82(Minn. App. 1995), review denied (Minn. Jan. 25, 1996). In Basich, the Lutheran World Federation declared “that apartheid was so contrary to the Lutheran understanding of believers in Christ that it must be rejected as a matter of faith itself.”540 N.W.2d at 84
. The ELCA then expressed opposition to apartheid and
8
passed a resolution that declared none of the ELCA pension funds would be invested in
companies doing business in South Africa. Id.
Several Lutheran pastors, a lay employee, and a Lutheran congregation (collectively
the Pastors) disagreed with the divestment policy and filed an individual action for breach
of contract and breach of fiduciary duty against the Board of Pensions, ELCA.4 The Pastors
alleged “that the Board of Pensions ha[d] mismanaged funds by investing and divesting
pursuant to social concerns rather than solely in the economic best interests of the plan
participants.” Id.The Pastors argued that a review of their case would not require the court to “entangle itself in issues of Lutheran doctrine.”Id. at 86
. We disagreed and noted that “[w]hile the Board of Pensions is required to prudently invest its holdings, the ELCA created the Board to both provide for pastors’ retirement needs and assist the ELCA in accomplishing doctrinal goals.”Id.
We stated that any review of the Board of Pensions’ policy of divesting funds from companies in South Africa due to apartheid “would entangle the court in reviewing church doctrine and policy.”Id.
Additionally, we reasoned that because the plan document was the primary “contract” between the parties and it provided that “the Board of Pensions shall discharge its duties with the care that a prudent person would use in the conduct of an enterprise of like character with like aims,” “the district court would be required to examine the ELCA’s ‘aims’ before it could determine the breach of contract issue.”Id.
We concluded that “[s]uch inquiry into church motives is forbidden by the Establishment Clause of the United States Constitution.”Id.
We also rejected the
4
Now known as Portico, the same respondent as in the present case.
9
argument that the “case [could] be resolved on neutral principles of contract and trust law,”
because “[t]here are no neutral principles of law that would enable a district court to
distinguish between investments that Lutheran doctrine should find to be morally
acceptable and those that it should find to be morally unacceptable.” Id.We concluded that “the Establishment Clause of the First Amendment deprive[d] the district court of subject matter jurisdiction.”Id.
Appellants argue that Basich does not compel a finding of excessive entanglement
in this case because there is no core religious doctrinal dispute here as there was in Basich.
Conversely Portico argues the district court correctly rejected appellants’ narrow reading
of Basich. We are persuaded by appellants’ argument because the nature of the complaint
in Basich is different from the nature of the complaint in this case. The Pastors in Basich
challenged the Board of Pensions’ divestment of funds from companies with holdings in
South Africa based on social and moral policy decisions. Id. In the instant case, appellants’
claims are not tied to a specific policy decision as was the case in Basich. Many of the
allegations in the complaint allege causes of action that are not tied to religious doctrine.5
5
For example, appellants allege Portico “fail[ed] to defray only reasonable expenses of
administering the Plans because the compensation that Portico received from the Plans for
administrative and recordkeeping services was and is unreasonable for the services
provided to the Plans,” and that Portico “set[] its own compensation in a manner that
benefited Portico at the expense of participants.” We see no core religious doctrinal dispute
in these types of allegations.
10
Further, at oral argument, appellants conceded that Basich bars any challenge based on a
social or moral policy decision of the ELCA.6
Pursuant to Pfeil,
a court may decide disputes involving religious organizations,
but only if the court is able to resolve the matter by relying
exclusively on neutral principles of law, the court does not
disturb the ruling of a governing ecclesiastical body with
respect to issues of doctrine, and the adjudication does not
“interfere[ ] with an internal church decision that affects the
faith and mission of the church itself.”
Pfeil, 877 N.W.2d at 534(alteration in original) (quoting Hosanna-Tabor,132 S. Ct. at 707
). Thus, Pfeil provides three criteria for a court to consider when deciding if it can resolve a dispute involving religious organizations: (1) can the dispute be resolved under neutral principles of law; (2) would the court disturb a ruling of a governing ecclesiastical body; and (3) would adjudication interfere with an internal church decision that affects the faith and mission of the church.Id.
Each criterion is addressed in turn.
First, we address whether the dispute can be resolved under neutral principles of
law. The “point of a neutral principles test is to apply a purely secular perspective to a
dispute, without inquiring into religious doctrine of practice.” Rooney v. Rooney, 669
N.W.2d 362, 368(Minn. App. 2003) (citing Jones,443 U.S. at 604
,99 S. Ct. at 3026
),
review denied (Minn. Nov. 25, 2003). A law is neutral when it can be applied without
6
This opinion is not intended to prohibit a district court from limiting specific claims that
involve core religious doctrinal disputes because they are based on social or moral policy
decisions of the ELCA. However, in the present case we are not persuaded that every
allegation was so tied to a religious policy decision that it compels dismissal at the
pleadings stage due to a finding of excessive entanglement with religion.
11
“requir[ing] any reference to or assessment of a religious component.” Odenthal, 649
N.W.2d at 441.
Appellants argue that their complaint does not require excessive entanglement in
religion because it is based on secular, neutral principles of law, not on any dispute over
core issues of ecclesiastical concern. The ELCA Plan provides the plan “shall be construed
and administered according to the laws of the State of Minnesota to the extent that such
laws are not preempted by the laws of the United States of America.” As such, appellants
contend that Minnesota common law and the MPIA apply. Portico contends that under the
MPIA the applicable standard of care is defined by the plan and trust documents. See
Minn. Stat. § 501C.0901, subd. 1(b) (“The prudent investor rule, a default rule, may be
expanded, restricted, eliminated, or otherwise altered by the trust instrument. A trustee is
not liable to a beneficiary to the extent that the trustee acted in reasonable reliance on the
trust instrument.”). Portico alleges that a Minnesota court cannot adjudicate this case
“without becoming the arbiter of the Church’s Continuing Resolutions, Social Statement,
and Philosophy of Benefits.” However, many of the claims in appellants’ complaint do
not challenge any church resolutions, the social statement, or the philosophy of benefits.
Because the plan documents themselves contain the fiduciary duties, a Minnesota court can
adjudicate many of the claims without reaching the religious documents.
Next we address whether resolution of the dispute would disturb a ruling of a
governing ecclesiastical body. There does not appear to be a specific ruling of a governing
ecclesiastical body at issue in this case. Cf. Basich, 540 N.W.2d at 86 (determining
resolution of the dispute would disturb the ELCA’s determination that the Board of
12
Pensions divest funds from companies with holdings in South Africa). Portico relies
generally on the ELCA’s constitution, social statement, and philosophy of benefits;
however, as discussed above, a Minnesota court may not need to consider them to resolve
the issues in this case.
Finally, we address whether adjudication of appellants’ claims would interfere with
an internal church decision that affects the faith and mission of the church. “Excessive
entanglement is, ultimately, a question of degree.” Black v. Snyder, 471 N.W.2d 715, 721(Minn. App. 1991), review denied (Minn. Aug. 29, 1991). A review of the Minnesota caselaw on which the parties rely is helpful in determining what degree of entanglement is permissible. In Basich we held that excessive entanglement exists when a court must “distinguish between investments that Lutheran doctrine should find to be morally acceptable and those that it should find to be morally unacceptable.”540 N.W.2d at 86
.
In Black, an associate pastor at a Lutheran church filed a discrimination charge
against her supervising pastor alleging that he made unwelcome sexual advances toward
her. 471 N.W.2d at 717-18. Her employment was later terminated, and she sued the church, the ELCA, and her supervising pastor based on five causes of action: sexual harassment and retaliation under the Minnesota Human Rights Act, breach of contract, defamation, and wrongful termination under the Minnesota Whistle Blower Act.Id. at 718
. She sought “damages and injunctive relief ordering public admission of the wrongfulness of her discharge and cleansing of her personnel record.”Id.
We determined
the prohibition of excessive entanglement with internal church affairs prohibited judicial
review of the discharge-related claims; however, we reversed the trial court’s dismissal of
13
the sexual-harassment claim because it did not “involve scrutiny of church doctrine,
interfere in matters of an inherently ecclesiastical nature, or infringe upon the church’s
religious practice.” Id. at 721.
In Hill-Murray Fed’n of Teachers v. Hill-Murray High Sch., lay employees of a
Catholic high school petitioned the Minnesota Bureau of Mediation Services for
determination of an appropriate bargaining unit and certification as exclusive
representative under the Minnesota Labor Relations Act (MLRA). 487 N.W.2d 857, 859- 60 (Minn. 1992). The court noted that “[t]he obligation imposed upon Hill-Murray by the application of the MLRA is the duty to bargain about hours, wages, and working conditions” and “decline[d] to categorize [the] minimal responsibility as excessive entanglement.”Id. at 864
. It reasoned that “[a]llowing lay teachers, almost all of whom are Catholic, to bargain collectively will not alter or impinge upon the religious character of the school.”Id.
It concluded that “[t]he [F]irst [A]mendment wall of separation between church and state does not prohibit limited governmental regulation of purely secular aspects of a church school’s operation.”Id.
In Odenthal, a church member brought a negligence action against his minister
alleging that the minister engaged in improprieties while counseling the church member’s
wife. 649 N.W.2d at 429-33. The Odenthal court held that, “[w]here statutes regulating
unlicensed mental health practitioners provide neutral principles of law to apply in a
negligence action against a member of the clergy, a court may adjudicate the claim without
excessive entanglement with religion,” and “[a]djudication of a negligence claim against a
14
member of the clergy based on neutral standards of conduct set forth in statute does not
violate Article I, Section 16 of the Minnesota Constitution.” Id. at 428-29.
In Doe v. Lutheran High Sch. of Greater Minneapolis, a man who was a secular
teacher and a pastor at a religious high school brought a wrongful-discharge claim against
the school alleging that he was discriminated against based on his sexual orientation. 702
N.W.2d 322, 324-26(Minn. App. 2005), review denied (Minn. Oct. 26, 2005). We noted that “there is no evidence showing that [the teacher] had a position that could be split into secular and nonsecular so that they could be considered separately and, further, analysis of [the teacher’s] claim would require delving into church doctrine.”Id. at 327
. We concluded that analyzing whether the teacher should not have been discharged based on his sexual orientation “intrudes into church doctrine and church administrative matters and engenders a prohibited relationship between the church and the judiciary,” and as such “resolution of [the teacher’s] claims would violate the establishment doctrine of the First Amendment.”Id.
Many issues in the present case can be resolved by an application of a neutral law,
the MPIA. As such, the present case is similar to Hill-Murray where the court determined
the MLRA applied to a religious school, see 487 N.W.2d at 864, and Odenthal where the case could be resolved using the statutes regulating unlicensed mental-health practitioners. See649 N.W.2d at 440-41
. The present case is distinguishable from Basich, Black, and
Doe because it does not require a court to adjudicate the validity of a doctrinal question.
Although Portico and the amicus, the Church Alliance, rely heavily on the ELCA
constitution, a Minnesota court would not need to interpret the ELCA constitution to
15
resolve most, if not all, of the claims in appellants’ complaint. With the exception of a
challenge to the “social purpose funds,” a court could resolve the claims relying on the plan
documents, the MPIA, and the common law of Minnesota. This position is strengthened
when one considers that the plan documents provide that any issues that arise under the
ELCA Plan should be heard in Hennepin County using Minnesota law. While assessing
whether there are alternative “social purpose” investments that would comply with the
“Social Statement on Economic Life” would excessively entangle Minnesota courts with
religion and, therefore, violate the Establishment Clause, see Basich, 540 N.W.2d at 86, it does not follow that resolution of the remainder of appellants’ claims would create excessive entanglement, which is always a matter of degree. See Black,471 N.W.2d at 721
.
Based on an analysis of the facts of this case compared with the facts of precedential
Minnesota excessive-entanglement cases and applying the criteria in Pfeil, it appears this
may be a case where “the autonomy granted to religious institutions by the First
Amendment is not boundless,” because a court could “use ‘neutral principles of law’ to
resolve [the] controvers[y] involving religious institutions and their parishioners.” Pfeil,
877 N.W.2d at 533(quoting Jones,443 U.S. at 602-05
,99 S. Ct. at 3025-26
).
Portico argues this court should “also affirm dismissal of the complaint under the
Minnesota Freedom of Conscience Clause.” See Minn. Const. art. I, § 16. When
determining whether the Freedom of Conscience Clause prohibits a court from hearing a
claim, we balance “the compelling state interest against the least restrictive alternative.”
Doe, 702 N.W.2d at 328. We consider the following factors: “[1] whether the objector’s
16
belief is sincerely held; [2] whether the state regulation burdens the exercise of religious
beliefs; [3] whether the state interest in the regulation is overriding or compelling; and
[4] whether the state regulation uses the least restrictive means.” Id.(alterations in original) (quoting Hill-Murray,487 N.W.2d at 865
). Portico’s argument fails on the second factor because we are not convinced at this stage in the litigation that adjudicating this case in a Minnesota court will burden the exercise of religion. Because Portico has not, at this time, met its burden in establishing that its exercise of religious beliefs is burdened by judicial oversight, we do not reach the balancing test of the third and fourth factors. See Edina Cmty. Lutheran Church v. State,745 N.W.2d 194, 208-10
(Minn. App.
2008) (reaching the balancing test where respondent churches established that their
religious beliefs were sincere and the exercise of their religious beliefs was burdened),
review denied (Minn. Apr. 29, 2008).
In conclusion, we are not persuaded that appellants have “fail[ed] to state a claim
upon which relief can be granted” based on excessive entanglement with religion under the
Establishment or Free Exercise Clauses of the First Amendment to the U.S. Constitution
or the Freedom of Conscience Clause of the Minnesota Constitution. Minn. R. Civ. Pro.
12.02(e). As such, we reverse the district court’s dismissal of appellants’ claims and
remand for proceedings consistent with this opinion.
Reversed and remanded.
17
Reference
- Status
- Unpublished