Dismissal reversed on claims against church defendants based on alleged cover-up of sexual abuse of minors.

Where plaintiffs alleged that “church entities were negligent regarding the sexual abuse of minors” by a clergyman, and the allegations included claims of fraudulent concealment through an investigation that was actually a “whitewash,” dismissal based on the statute of limitations was reversed. Further, dismissal of plaintiffs’ claim for negligent infliction of emotional distress based on the entities disclosing plaintiffs’ names to the media was also reversed, as the Court concluded that defendants did have a duty to plaintiffs and the act of releasing plaintiffs’ names was sufficiently outrageous to sustain the tort claim.

In Doe v. Woodland Presbyterian, No. W2021-00353-COA-R3-CV, 2022 WL 1837455 (Tenn. Ct. App. June 3, 2022), the three plaintiffs were former members or attendees of Woodland Presbyterian Church, and all three alleged that former paster Stanford had sexually assaulted them in the 1990s when they were minors. Plaintiffs filed this suit in May 2020 against Stanford and several church entities, asserting claims for negligence and negligent infliction of emotional distress. (The claims against Stanford were not at issue on appeal). Plaintiffs asserted, among other things, that church leaders knew Stanford was having young boys spend the night at his home, that defendants “failed to have policies in place that would prevent Pastor Stanford from being alone with minors on church-owned property,” and that defendants failed to have proper policies and training. Further, plaintiffs alleged that when the current pastor was contacted about the abuse allegations in June 2019, he stated that he believed the allegations because he had heard similar stories, and that the situation had been “fully investigated.” Plaintiffs asserted that they later learned that this alleged investigation was a ”whitewash” and attempt to cover up the abuse.

Defendants filed motions to dismiss, which the trial court granted, finding that the claims were barred by the statute of limitations. The trial court noted that plaintiffs were minors when the abuse occurred, and that they “would have had at least a year from the time that they turned 18 to…pursue their claims,” but that such time period had long since passed. The trial court ruled that because plaintiffs knew what happened when they were minors, reported it then, and “knew what investigation was or was not done then,” the statute of limitations began to run when they turned 18. In addition, as to two defendants, the trial court found that it lacked personal jurisdiction over them. On appeal, the ruling regarding personal jurisdiction was affirmed, but dismissal based on the statute of limitations was reversed.

The Court of Appeals addressed three issues in its opinion. First, it considered the dismissal based on a lack of personal jurisdiction over Presbyterian Church (U.S.A.) and Evangelical Presbyterian Church. Both of these defendants were corporate entities at the top of the church’s hierarchical structure. Neither were incorporated nor had their principal place of business in Tennessee, and both argued that “Plaintiffs failed to point to any specific actions they undertook in the state of Tennessee to make them subject to personal jurisdiction here.” Looking to Tennessee law, the Court noted that “[a] parent corporation’s general involvement with the subsidiary corporation’s performance, finance and budget decisions, and general policies and procedures does not provide a basis for attributing one corporation’s contacts with the forum to the other for the purposes of personal jurisdiction.” (internal citation).

After considering a similar case decided by the Western District of Tennessee federal court, the Court of Appeals affirmed the ruling that the trial court did not have personal jurisdiction over these two defendants. The Court explained:

Plaintiffs simply did not allege that Presbyterian Church (U.S.A.), A Corporation or Evangelical Presbyterian Church did anything in the state of Tennessee so as to make it fair and just for a Tennessee court to exercise personal jurisdiction over them. The presumption of corporate separateness is recognized in Tennessee, and there is no dispute that these are distinct corporate entities. For purposes of establishing personal jurisdiction, Plaintiffs have merely alleged an “ecclesiastical structure” similar to “many religious institutions.” That is insufficient to assert personal jurisdiction over out-of-state defendants. Plaintiffs alleged nothing in the way of continuous, systematic, and substantial conduct by these defendants in the state of Tennessee. Plaintiffs alleged that Presbyterian Church (U.S.A.), A Corporation commissioned a study on sexual abuse in the church in the 1990s, but they did not make any Tennessee-specific allegations. None of these alleged facts suggest anything like the minimum, sufficient contacts necessary to establish personal jurisdiction. Based upon the allegations contained in Plaintiffs’ complaint, Presbyterian Church (U.S.A.), A Corporation and the Evangelical Presbyterian Church lack sufficient minimum contacts with Tennessee such that the Trial Court’s exercise of personal jurisdiction over these non-resident defendants would be unfair. We affirm the Trial Court’s dismissal of Presbyterian Church (U.S.A.), A Corporation and the Evangelical Presbyterian Church on personal jurisdiction grounds.

(internal citations omitted).

Next, the Court analyzed whether the trial court erred by dismissing the claims against the remaining defendants on the basis that “the statute of limitations expired and that no tolling provisions applied to prevent the running of the statute of limitations.” In its opinion, the Court quoted extensively from Redwing v. Catholic Bishop for the Diocese of Memphis, 363 S.W.3d 436 (Tenn. 2012), a case with similar allegations and statute of limitations issues. In Redwing, the Tennessee Supreme Court “articulated the doctrines of equitable estoppel and fraudulent concealment,” and ultimately decided that under facts very similar to those at issue here, dismissal at the motion to dismiss stage was not appropriate. The Supreme Court essentially ruled that more facts were needed to determine when the statute of limitations began to run in that case and whether and for how long it was tolled. In this case, the Court of Appeals came to a similar result.

The Court reasoned:

We agree with Plaintiffs that Redwing is highly instructive and controlling to the appeal at bar. Both Redwing and the present case concern allegations of an institutional cover-up of child sexual abuse perpetrated by a clergyman and a question of whether the applicable statute of limitations was tolled. Just like the plaintiff in Redwing, Plaintiffs “knew [they were] abused, knew the identity of the abuser, and knew the abuser was an employee of the employer.” Based upon their complaint, Plaintiffs knew they were abused at the time; knew Stanford abused them; and knew Stanford was Woodland’s pastor. However, our Supreme Court in Redwing determined that this factual scenario was not dispositive of whether the statute of limitations had run. The High Court traced the development of the discovery rule, which replaced the harsher accrual rule that preceded it. Without a tolling theory, or application of the discovery rule, Plaintiffs’ 2020 lawsuit for events alleged to have occurred in the 1990s would be time-barred given the applicable one-year statute of limitations which would have begun to run upon Plaintiffs’ attaining majority age. Plaintiffs do assert such theories; they assert both fraudulent concealment and equitable estoppel.

As this case was disposed of at the motion to dismiss stage, we examine Plaintiffs’ complaint to determine whether Plaintiffs have successfully alleged fraudulent concealment. Plaintiffs alleged, among many other things, that “[i]n the summer of 2019, the Plaintiffs were told by former Woodland Presbyterian pastor John Sowers that a ‘full investigation’ was done at the time the complaints were made in the 1990s”; that “[t]he Plaintiffs recently learned that the ‘full investigation’ was a complete ‘whitewash’ ”; that “[u]pon information and belief efforts were undertaken to conceal and hide this illegal and heinous activity”; and that “[defendants] and their agents and employees were aware of the risks of clergy abuse in the Presbyterian Church in the early 1990s prior to their abuse but failed to implement policies that would protect its own members, including them.” Plaintiffs’ allegations that “efforts were undertaken to conceal and hide this illegal and heinous activity” and that the investigation was a “whitewash,” factual allegations we are bound to accept as true at the motion to dismiss stage, are supportive of fraudulent concealment.

In Redwing, our Supreme Court articulated the elements necessary to establish fraudulent concealment… In line with those elements, Plaintiffs’ complaint alleges (1) that the institutional defendants in question failed to disclose and/or concealed material facts regarding the injury or the wrongdoer despite a duty to do so; (2) that Plaintiffs could not have discovered the institutional conduct despite reasonable care and diligence in view of the “whitewash”; (3) that the institutional defendants in question knew or should have known of the sexual abuse in the church to include Plaintiffs’ allegations against Stanford; and (4) that the institutional defendants in question concealed material information from Plaintiffs by means of a “whitewash.” In addition, Plaintiffs allege they discovered in June 2019 new information about their experiences when John Doe 3 contacted Pastor Matt Miller at Woodland and was told Miller believed Plaintiffs because he had heard stories supporting their claims. Whether Plaintiffs can substantiate their claims is another matter, but at this stage they have alleged that [defendants] are liable for Woodland’s conduct based upon principles of agency and vicarious liability. Plaintiffs’ factual allegations related to agency and vicarious liability as well as these defendants’ own negligence, while not richly detailed as to the Presbyterian Church’s structure, are sufficient to withstand the institutional defendants’ motions to dismiss for failure to state a claim.

Plaintiffs’ allegations are not identical to those in Redwing, but they are sufficiently analogous. We are obliged to adhere to our Supreme Court’s precedents, and Redwing has never been overruled. Plaintiffs have successfully alleged that the applicable one-year statute of limitations did not begin to run until June 2019 due to fraudulent concealment.

(internal citations omitted).

Finally, the Court of Appeals addressed the dismissal of plaintiffs’ claim for negligent infliction of emotional distress, which was based on defendants releasing plaintiffs’ names to the media in 2019. The Court first considered defendants’ argument that it did not have a duty to plaintiffs, with the Court setting out seven factors to be considered when analyzing whether a duty exists, including the foreseeability of harm, the “social value of the activity engaged in by the defendant,” and the “feasibility of alternative conduct that is safer.” The Court reasoned:

We have little difficulty concluding that releasing Plaintiffs’ names to the media could, foreseeably, cause them significant emotional distress. We also are hard-pressed to identify the importance or social value attendant to Woodland’s releasing the names of alleged sexual abuse victims to the media, or how that would be useful to Woodland. On the contrary, the socially useful or valuable activity would be that of encouraging victims of sexual abuse and alleged institutional cover-up to come forward, not chilling disclosure by releasing their names to the media so they might well have to relive their experiences exposed in the public eye. As to safer, more feasible and useful alternative conduct, it is unclear how the conduct alleged was either useful or necessary to begin with so as to warrant an alternative—based on Plaintiffs’ complaint, Woodland could simply have refrained from releasing Plaintiffs’ names to the media. We conclude that Woodland owed Plaintiffs a duty of reasonable care in safeguarding Plaintiffs’ identities. In addition, while Plaintiffs’ not alleging that the media further disseminated their names may be relevant to damages, it is not dispositive as to whether a duty existed. Our conclusion that Woodland owed Plaintiffs a duty of care in 2019 in no way derives from Plaintiffs’ former membership or attendance of, or religious relationship with, Woodland. Our conclusion would be the same if Woodland were a secular organization facing the same allegations.

Having determined that there was a duty, the Court next looked at defendants’ argument that the conduct was not sufficiently “extreme or outrageous to sustain a claim of negligent infliction of emotional distress,” an argument quickly rejected by the Court of Appeals. The Court pointed out that while some emotional distress cases are premised on scenarios that produced significant physical harm, “Tennessee law does not preclude the possibility that a negligent infliction of emotional distress claim may be based upon the kind of conduct asserted here.” Accordingly, dismissal of this claim was reversed.

The facts alleged here closely mirrored those alleged in Redwing, and the Court of Appeals decided to follow the Supreme Court’s lead and ruled accordingly. While the negligence claims in this case, which were largely based on conduct that occurred twenty-plus years ago, survived the motion to dismiss, it is unclear how the reasoning herein might be applied in a context outside a religious abuse cover-up scenario.

This opinion was released two months after oral arguments in this case.

Note:  Chapter 65, Sections 1 and 10, and Chapter 80, Section 7 of Day on Torts: Leading Cases in Tennessee Tort Law has been updated to include this decision.

Day on Torts: Leading Cases in Tennessee Tort Law contains summaries of leading cases on over 500 topics and citations to more than 1500 additional cases.  The 500,000+ word book  (and two others, Tennessee Law of Civil Trial and Compendium of Tennessee Tort Reform Cases) is available by subscription at www.birddoglaw.com and is continually updated as new decisions and statutes impact Tennessee law.  Click on the link to see the book’s Table of Contents.

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