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Gregorio v. Hoover

United States District Court, District of Columbia

February 28, 2017



          Emmet G. Sullivan United States District Judge.

         Newton Gregorio, co-founder of the Capital Wesleyan Church (“Capital”), brings this action individually and as the Pastor and Minister in Charge of Capital against the Chesapeake District of the Wesleyan Church (“Chesapeake”) and Stanley K. Hoover, Chesapeake's Superintendent. Mr. Gregorio asserts claims of breach of contract, unjust enrichment, wrongful eviction, defamation, and age discrimination. Defendants have moved to dismiss Mr. Gregorio's complaint for lack of subject matter jurisdiction or, in the alternative, for failure to state a claim upon which relief may be granted. Upon consideration of the motion, the response and reply thereto, the applicable law, and for the reasons discussed below, defendants' motion to dismiss is GRANTED IN PART and DENIED IN PART.

         I. Background

         The facts alleged in the complaint are as follows. In 1995, Newton Gregorio and his wife, Lynette Gregorio, co-founded the Capital Inner City Outreach Ministry, which they later incorporated as the Capital Wesleyan Church. Compl., ECF No. 1-1 ¶ 6. Capital adopted and affiliated itself with Wesleyan religious doctrines and principles but retained its organizational, administrative, and pastoral independence vis-à-vis the national Wesleyan Church and the national Church's mid-Atlantic regional subsidiary, the Chesapeake District of the Wesleyan Church. Id. ¶¶ 6-8.

         Despite that independence, Chesapeake procured a loan in the amount of $110, 000 from the Wesleyan Investment Foundation (“WIF”) to be used for the purchase of property at 383114th Street, Northwest, Washington, D.C., and Capital and Chesapeake co-signed the promissory note related to that loan. Id. ¶ 7. The Deed of Trust, however, was in Chesapeake's name only, and Chesapeake holds title to the property. Id. ¶¶ 7, 9. At some point, Capital and Chesapeake “entered into an agreement” related to the 383114th Street property that provided that Chesapeake would secure and arrange the financing to purchase the property; that Capital would be responsible for repaying the loan; that Chesapeake would hold title to the property while the loan was in repayment “to protect against Capital's default on the loan”; and that, when the loan was repaid, Chesapeake would “relinquish the title to the property to Capital free and clear of any encumbrances.” Id. ¶¶ 18, 21. By 2005, Capital, using “the funds of the Capital membership without any contribution from Chesapeake, ” had fully repaid the loan, but since that time Chesapeake has refused to transfer title to Capital. Id. ¶¶ 9, 16, 19, 21.

         Chesapeake also obtained financing to purchase an adjacent property at 3829 14th Street, Northwest, Washington, D.C. and entered into a “special arrangement” with Capital “whereby the property would be owned by Chesapeake, but Capital would be responsible for payment of the [p]romissory [n]ote on the property.” Id. ¶¶ 17, 31.[1] Thus, Mr. Gregorio “raised the funds to pay for” the 3829 14th Street property. Id. ¶ 10. Those payments were made until Chesapeake took action in the spring and summer of 2015 to remove Mr. Gregorio from his positions as Pastor and Minister in Charge of Capital. See Id. ¶ 31.

         Mr. Gregorio had held those positions along with his wife until she passed away in 2011. See Id. ¶¶ 7, 10. After Mr. Gregorio's wife's passing, Stanley K. Hoover, the District Superintendent for Chesapeake, formally appointed Mr. Gregorio as Minister in Charge of Capital. Id. ¶ 10. Although Mr. Gregorio maintains that Mr. Hoover and Chesapeake had no authority to determine who was Minister in Charge of Capital, Mr. Gregorio accepted the appointment and, concurrent with it, accepted a stipend of $1, 500 per month. See Id. ¶¶ 10-11. Mr. Gregorio stopped receiving that stipend in October 2012. Id. ¶ 11.

         On April 29, 2015, Mr. Hoover informed Mr. Gregorio that it was time for Mr. Gregorio to retire because Chesapeake had “younger people” capable of taking his place and that his last day as Minister in Charge would be May 31, 2015. Id. ¶ 12. Mr. Gregorio, however, continued to assert his authority to act as Minister in Charge. Id. Chesapeake and Mr. Hoover responded by changing the locks to the buildings on the 3829 and 383114th Street properties without notice to Mr. Gregorio. Id. ¶ 13. On June 26 and July 2, 2015, Chesapeake and Mr. Hoover sent a letter to law enforcement authorities in the District of Columbia and Maryland stating that Mr. Gregorio “had made illegal and unauthorized entry onto the properties” and informed Mr. Gregorio that he would be subject to arrest if he attempted to enter them again. Id. ¶¶ 14, 38, 40.

         Mr. Gregorio, individually and as Pastor and Minister in Charge of Capital, [2] alleges six counts against Chesapeake and Mr. Hoover: (1) breach of contract based on defendants' failure to convey title to the 383114th Street property to Capital pursuant to the agreement to carry out such a transfer upon Capital's repayment of the WIF loan, id. ¶¶ 17-22; (2) loss of wages based on defendants' failure to pay the promised monthly stipend of $1, 500 starting in October 2012, id. ¶¶ 23-26; (3) unjust enrichment based on defendants' retention of the title to the 383114th Street property despite Capital's repayment of the relevant loan, and unjust enrichment based on defendants' acceptance of Capital's payments on the loan pertaining to the 3829 14th Street property, id. ¶¶ 27-31; (4) wrongful eviction based on defendants changing the locks to the buildings on the properties in order to prevent Mr. Gregorio from accessing them, id. ¶¶ 32-26; (5) defamation based on the letter defendants disseminated to law enforcement authorities that stated that Mr. Gregorio had illegally entered onto the properties, id. ¶¶ 37-41; and (6) age discrimination based on Mr. Hoover forcing Mr. Gregorio to retire from his position at Capital because younger people were able to take his place. Id. ¶¶ 42, 45-47.

         Defendants removed the case to this Court, see Notice of Removal, ECF No. 1, and have moved to dismiss the claims against them because, they argue, this Court lacks subject matter jurisdiction or, in the alternative, because Mr. Gregorio has failed to state a claim upon which relief can be granted. See generally Defs.' Mot. to Dismiss, ECF No. 7. Defendants' motion is now ripe and ready for the Court's adjudication.

         II. Legal Standards

         A. Rule 12(b)(1)

         “A federal district court may only hear a claim over which [it] has subject matter jurisdiction; therefore, a Rule 12(b)(1) motion for dismissal is a threshold challenge to a court's jurisdiction.” Metro. Washington Chapter v. District of Columbia, 57 F.Supp.3d 1, 13 (D.D.C. 2014). To survive a Rule 12(b)(1) motion to dismiss, “the plaintiff bears the burden of establishing jurisdiction by a preponderance of the evidence.” Moran v. U.S. Capitol Police Bd., 820 F.Supp.2d 48, 53 (D.D.C. 2011) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992)). Because Rule 12(b)(1) concerns a court's ability to hear a particular claim, “the court must scrutinize the plaintiff's allegations more closely when considering a motion to dismiss pursuant to Rule 12(b)(1) than it would under a motion to dismiss pursuant to Rule 12(b)(6).” Schmidt v. U.S. Capitol Police Bd., 826 F.Supp.2d 59, 65 (D.D.C. 2011). In so doing, the court must accept as true all of the factual allegations in the complaint and draw all reasonable inferences in favor of the plaintiff, but the court need not “accept inferences unsupported by the facts alleged or legal conclusions that are cast as factual allegations.” Rann v. Chao, 154 F.Supp.2d 61, 64 (D.D.C. 2001). In reviewing a motion to dismiss pursuant to Rule 12(b)(1), the court “may consider such materials outside the pleadings as it deems appropriate to resolve the question whether it has jurisdiction to hear the case.” Scolaro v. D.C. Bd. of Elections & Ethics, 104 F.Supp.2d 18, 22 (D.D.C. 2000); see also Jerome Stevens Pharm., Inc. v. FDA, 402 F.3d 1249, 1253 (D.C. Cir. 2005).

         B. Rule 12(b)(6)

         A motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) tests the legal sufficiency of a complaint. Browning v. Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002). A complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief, in order to give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotation marks omitted). The plaintiff need not plead all of the elements of a prima facie case in the complaint. See Swierkiewicz v. Sorema N.A., 534 U.S. 506, 511-14 (2002).

         Despite this liberal pleading standard, to survive a motion to dismiss, a complaint “must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks omitted). A claim is facially plausible when the facts pled in the complaint allow the court to “draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. The standard does not amount to a “probability requirement, ” but it does require more than a “sheer possibility that a defendant has acted unlawfully.” Id.

         “[W]hen ruling on a defendant's motion to dismiss [pursuant to Rule 12(b)(6)], a judge must accept as true all of the factual allegations contained in the complaint, ” Atherton v. D.C. Office of the Mayor, 567 F.3d 672, 681 (D.C. Cir. 2009) (internal quotation marks omitted), and the court must give the plaintiff the “benefit of all inferences that can be derived from the facts alleged.” Kowal v. MCI Commc'ns Corp., 16 F.3d 1271, 1276 (D.C. Cir. 1994). Even so, the court need not “accept inferences drawn by plaintiffs if such inferences are unsupported by the facts set out in the complaint” or “legal conclusions cast in the form of factual allegations.” Id. Further, “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements” are not sufficient to state a claim. Iqbal, 556 U.S. at 678.

         “In determining whether a complaint states a claim, the court may consider the facts alleged in the complaint, documents attached thereto or incorporated therein, and matters of which it may take judicial notice.” Abhe & Svoboda, Inc. v. Chao, 508 F.3d 1052, 1059 (D.C. Cir. 2007) (internal quotation marks omitted). Among the documents subject to judicial notice on a motion to dismiss are “public records.” Kaempe v. Myers, 367 F.3d 958, 965 (D.C. Cir. 2004).

         C. First Amendment Religious Entanglement Doctrines

         Relying on two doctrines rooted in the First Amendment's Religion Clauses--the ministerial exception and the ecclesiastical abstention doctrine--defendants argue that Mr. Gregorio's claims are inextricably intertwined with religious matters such that this Court, pursuant to Rule 12(b)(1), does not have subject matter jurisdiction over them. See Defs.' Mem. in Supp. of Mot. to Dismiss (“Defs.' Mem. Supp.”), ECF No. 7-1 at 6-7. Although both of these doctrines can warrant dismissal of claims on First Amendment grounds, the ministerial exception “operates as an affirmative defense to an otherwise cognizable claim, not a jurisdictional bar.” Hosanna-Tabor Evangelical Lutheran Church & Sch. v. EEOC, 565 U.S. 171, 195 n.4 (2012). Accordingly, defendants' ministerial exception arguments are properly analyzed under a Rule 12(b)(6), rather than a Rule 12(b)(1), lens. See Cannata v. Catholic Diocese of Austin, 700 F.3d 169, 171 (5th Cir. 2012). However, without definitive guidance otherwise from the Supreme Court or the D.C. Circuit, the Court will analyze defendants' arguments under the ecclesiastical abstention doctrine--which is “related” to but “distinct” from the ministerial exception, see Kavanagh v. Zwilling, 997 F.Supp.2d 241, 248 n.7 (S.D.N.Y. 2014)--under a Rule 12(b)(1) lens, as that approach is consistent with the long-standing practice of treating questions of ecclesiastical entanglement as jurisdictional. See id.

         The ecclesiastical abstention doctrine is grounded in a “long line of Supreme Court cases that affirm the fundamental right of churches to ‘decide for themselves, free from state interference, matters of church government as well as those of faith and doctrine.'” EEOC v. Catholic Univ. of Am., 83 F.3d 455, 462 (D.C. Cir. 1996) (quoting Kedroff v. St. Nicholas Cathedral of Russian Orthodox Church in N. Am., 344 U.S. 94, 116 (1952)). Accordingly, the doctrine “limit[s] the role of civil courts in the resolution of religious controversies that incidentally affect civil rights, ” Serbian E. Orthodox Diocese v. Milivojevich, 426 U.S. 696, 710 (1976), and “severely circumscribes the role that civil courts may play in resolving church property disputes.” Presbyterian Church v. Mary Elizabeth Blue Hull Mem'l Presbyterian Church, 393 U.S. 440, 449 (1969). Even so, “not every civil court decision as to property claimed by a religious organization jeopardizes values protected by the First Amendment.” Id. Thus, “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.” Jones v. Wolf, 443 U.S. 595, 602 (1979) (internal quotation marks omitted). The District of Columbia has adopted the neutral principles approach to resolve church property disputes. Family Fed'n for World Peace v. Hyun Jin Moon, 129 A.3d 234, 249 (D.C. 2015). Under that approach, a court “relies exclusively on objective, well-established concepts of trust and property law familiar to lawyers and judges, ” thereby keeping it free “from entanglement in questions of religious doctrine, polity, and practice.” Jones, 443 U.S. at 603. As long as its analysis avoids judicial entanglement with religious doctrine, a court under the neutral principles approach can appropriately assess various documents, including deeds, corporate charters, and church constitutions. See Md. & Va. Eldership of the Churches of God v. Church of God at Sharpsburg, Inc., 396 U.S. 367, 367-68 (1970) (holding that a court's resolution of a church property dispute did not involve an inquiry into religious doctrine when the court had assessed the language in deeds, the terms of corporate charters, and the terms of a church's constitution).

         The related ministerial exception “precludes application of [employment discrimination laws] to claims concerning the employment relationship between a religious institution and its ministers.” Hosanna-Tabor, 565 U.S. at 188. “The exception . . . ensures that the authority to select and control who will minister to the faithful--a matter strictly ecclesiastical--is the church's alone.” Id. at 194-95 (internal quotation marks and citation omitted). The Supreme Court has expressed no view on whether the exception bars claims other than employment discrimination claims. Id. at 196. In this Circuit, the exception does not bar a breach of contract claim when ...

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