$1 billion in real estate assets of Jehovah’s Witnesses frozen until sexual abuse case is solved?
On June 20th 2012 Judge Robert D. McGuinnes ruled that the $1 billion in real estate assets of the Watch Tower Society are to be frozen pending the outcome of the Watchtower Society’s appeal against the judgment of $21 million in punitive damages in the Candace Conti case. The outcome of the appeal is estimated to take up two years.
Our first reaction was: “This has huge consequences for the financial freedom and clout of the legal entity of the Jehovah’s Witnesses, The Watchtower Bible and Tract Society of New York, because for the next two years, they cannot buy, sell or exchange property without first seeking the permission of the Alameda County Superior Court.”
Silentlambs brought this to our attention:
There have been many comments and some articles written about the freezing of one billion dollars of Watchtower assets following the loss of the Candace Conti court case. Those that have commented on this are technically true in part but in the typical court proceedings this is just a matter of the regular filing of documents to protect the settlement for the plaintiff.
It is considered a typical move in a court proceeding to freeze the assets when the defendant had yet to obtain a bond to cover the settlement. It was apparent WT did not expect to lose and simply were not prepared for this. So the Judge doing his job made the ruling contingent upon WT obtaining a bond to protect the settlement for Ms Conti. The minute the Watchtower obtains the bond the all assets are free and clear to be used any way they wish. So this looks like more of a procedural matter. WT will obtain a bond in a week or so and the order will in a matter of typical court procedure be removed. [...]
So the real estate assets of the Watch Tower Society are only frozen for only a week or so and this ruling will not have huge consequences for the financial freedom and clout of the Watchtower Society.
In a press release on jw-media.org, the Watchtower Society states the following:
Jehovah’s Witnesses will appeal the decision of a California jury in a court case involving alleged acts of child abuse.
The jury rendered a multimillion-dollar damage award to a woman who claimed that she was molested as a child by a member of a local congregation of Jehovah’s Witnesses. At trial, the plaintiff claimed that the policies of the Watchtower Bible and Tract Society contributed to the alleged abuse. “We respectfully disagree with the jury’s decision. This is the first time that an organization was found responsible for the alleged misdeeds of a member who held no position of leadership or authority,” states James McCabe, an attorney representing Watchtower in the case. “We are very sorry for whatever harm this young lady may have suffered. However, the organization is not responsible. We now look to the Court of Appeals for a thorough review of this case.
Here are the court-documents:
Filed on June 19, 2012, DEFENDANTS WATCHTOWER AND NORTH FREMONT CONGREGATION’S EX PARTE APPLICATION TO STAY ENFORCEMENT OF JUDGMENT;
Defendants Watchtower applied for an Order temporarily staying enforcement of any judgment that may in the future be entered in this matter on the verdicts returned by the jury on June 13 and 14, 2012, until ten (10) days after the last day on which a notice of appeal may be filed, and (2) extinguishing any existing liens, levies or attachments and preventing the creation of any new liens, levies or attachments during the pendency of the temporary stay.
Defendants claimed that this matter is necessary because: (1) the Church Defendants intend to file post-trial motions and, therefore, the final judgment may be eliminated, reduced, modified, or otherwise affected; (2) the Church Defendants presently intend to file an appeal should their post-trial motions be denied in whole or in part and, therefore, they will need time to obtain the requisite bond, …
Also filed on June 19, 2012, PLAINTIFF JANE DOE’S LIMITED OPPOSITION TO DEFENDANTS WATCHTOWER BIBLE AND TRACT SOCIETY OF NEW YORK, INC. AND NORTH FREMONT CONGREGATION’S EX PARTE APPLICATION TO STAY ENFORCEMENT OF JUDGMENT.
Plaintiff has no objection to an Order preventing the creation of any new liens, levies, or attachments, provided she is protected from a distribution of assets in avoidance of the judgment.
There are no existing liens, levies, or attachments to extinguish, as a result of which, that part of the Ex Parte request is moot. However, Plaintiff’s willingness to agree to a stay of execution of the judgment to be filed shortly is conditional. To avoid a massive transfer of real estate assets worth, at present, approximately $1 Billion, from Watchtower to another corporate entity of Jehovah’s Witnesses, which would leave Plaintiff with no enforcement right for the Judgment, Plaintiff requests that any stay be subject to the condition that defendant Watchtower Bible and Tract Society of New York, Inc. not transfer, convey, or change title to any of its real property prior to the filing of a bond or undertaking required as a condition of appeal.
Defendant filed on June 19, 2012 a REPLY BRIEF IN SUPPORT OF EX PARTE APPLICATION TO STAY ENFORCEMENT OF JUDGMENT stating:
Plaintiff’s opposition states a willingness to agree to a stay of execution of the judgment on the condition that Defendant Watchtower “not transfer, convey, or change title to any of its real property prior to the filing of a bond or undertaking required as a condition of appeal.” This condition puts the proverbial cart before the horse.
As explained in the ex parte application, a temporary stay of enforcement of the judgment is necessary to protect the Church Defendants because of the uncertainty of the judgment, …
Temporary stays like the one the Church Defendants are requesting here are routinely granted to protect the parties when a judgment is uncertain. While Defendant Watchtower has absolutely no intent to make any fraudulent transfers of real property now or in the future, to the extent any such transfers of real property should occur during the stay to prevent Plaintiff from collecting on any ultimate judgment that may survive the post-trial motions and appeals, remedies would plainly be available to Plaintiff. That said, again, Plaintiff’s claimed concern is premature, plus the Church Defendants have no intention of defrauding Plaintiff out of any judgment that ultimately may be owed to her once all post–trial motions and appeals have run their course. …
Filed June 20, 2012 (Decision of Hon. Robert D. McGuinnes, Judge of the Superior Court) BY THE COURT, ORDER GRANTING DEFENDANTS WATCHTOWER AND NORTH FREMONT CONGREGATION’S EX PARTE APPLICATION TO STAY ENFORCEMENT OF THE JUDGMENT.
After considering the submitted papers, including any response or opposition filed on behalf of Plaintiff, the Court grants the Church Defendants’ application as follows:
GOOD CAUSE APPEARING, IT IS HEREBY ORDERED THAT:
(1) Enforcement of the judgment to be entered on the jury’s special verdicts of June 13 and 14, 2012 shall be temporarily and completely stayed and, pending another order of court [The last five words were handwritten in by the judge]
(2) Any existing liens, levies or attachments pertaining to the forthcoming judgment referenced in (1) above are here by extinguished RDM [RDM handwritten in by the judge]
Then the judge included in his own handwriting a number 3:
(3) The foregoing stay is expressly conditioned upon D’s The Watchtower Bible and Tract Society of New York Inc’s not transferring, conveying or changing title to any real property in its name today pending further order of court