Property, intangible

In 2012, the South Carolina Diocese of The Episcopal Church declared that it disassociated from parent The Episcopal Church, a hierarchical church. The common understanding is that it was because of the ordination of gay clergy and acceptance of same-sex unions, although the disassociating diocese differs with that characterization. As a result there are two South Carolina dioceses, each claiming to be the one true Episcopal diocese.

As described by the court, we have

• The Episcopal Church (TEC), owner of federal trademark registrations and intervenor
• The Historic Diocese, the member diocese of TEC before the dispute and the owner of state trademark registrations, headed by defendant Lawrence until the schism
• The Episcopal Church in South Carolina (TECSC), the diocese affiliated with TEC after the schism, headed by named plaintiff vonRosenberg as appointed by TEC
• The Disassociated Diocese, the diocese now headed by Lawrence
• Member parishes of the Disassociated Diocese

Lawsuits ensue in both federal and state court. The state court suit is over ownership of property and the federal lawsuit is for trademark infringement, dilution, and related claims.

Ultimately the South Carolina Supreme Court held in 2017 that TECSC is the true owner of the diocesan property. The state Supreme Court deferred to the federal court on the trademark claims, however the South Carolina Supreme Court decision was the beginning and end of the question of ownership of the trademarks:

At the outset, as held above, it is settled by a majority of the South Carolina Supreme Court that TECSC is the lawful successor to the Historic Diocese. This issue has already been litigated, directly determined and necessary to support a judgment, and therefore Defendants are collaterally estopped from relitigating this issue. Therefore, for legal purposes of intellectual property, Plaintiff TECSC is the successor to the [H]istoric Diocese.

Furthermore, this Court independently holds that TECSC is the lawful successor of the Historic Diocese since this Court is mandated to accept as binding the decision of the highest ecclesiastical body in a hierarchical religious organization. TEC is a hierarchical church. Plaintiffs have submitted unrebutted evidence that TEC is a three-tiered, hierarchical church composed of the “Church’s General Convention at the topmost tier, regional dioceses in the middle tier” and congregations on the bottom tier. This matter is not for dispute, and every other court to assess the issue, including the Fourth Circuit, has determined that TEC is hierarchal.

Therefore, since TEC is hierarchical, “[i]t is axiomatic that the civil courts lack any authority to resolve disputes arising under religious law and polity, and they must defer to the highest ecclesiastical tribunal within a hierarchical church applying its religious law.” …

In sum, this dispute, regarding church polity and administration of TEC’s administrative structure is precisely the type of case in which the Court must defer to a religious institutions’ highest ecclesiastical tribunal, which here removed Defendant Lawrence as the head of the Historic Diocese. Therefore, it was for TEC to determine which Bishop was leading the Historic Diocese and the Court is mandated to defer to TEC’s designation of Bishop vonRosenberg, and later Provisional Bishop Adams, as the head of the Historic Diocese, and thus the TECSC as the successor to the Historic Diocese.

Various challenges to the validity of the mark all failed. If you’re interested in the characterization of denominational names as generic or descriptive, the court does an excellent job of explaining trademark significance in relation to religion, explaining when a use is generic and when it’s not. The case is also a recommended read if you’re interested in the law regarding courts’ deference to religious organizations.

Interestingly, the Historic Diocese predates The Episcopal Church. This allowed the Disassociated Diocese to claim that it had senior rights to TEC. The claim failed for two reasons. Because TEC didn’t recognize the Disassociated Diocese as the successor, the Disassociated Diocese couldn’t tack to this use by the Historic Diocese. The claim also failed because of “merger,” a principle that a user can no longer claim earlier use after joining another organization using the same mark.

Therefore TEC was owner of the federal registrations and TECSC was the owner of the state trademark registrations. The Disassociated Diocese is permanently enjoined from using the TEC and TECSC marks. They can use “episcopal,” which denotes an organization governed by bishops, but cannot use it in a confusing way. Examples of coexisting uses of “episcopal” are the Reformed Episcopal Church, the African Methodist Episcopal Church, and the Christian Methodist Episcopal Church. However, the Disassociating Diocese has renamed as The Anglican Diocese of South Carolina and says that they are likely to appeal.

However, while individual parishes (who are also defendants) are enjoined from using the TEC and TECSC marks, summary judgment of infringement for individual parishes names was denied because TEC and TECSC had not proved that the individual parish names (for example, The Vestry and Church Wardens of the Episcopal Church of the Parish of St. Matthew’s, Holy Trinity Episcopal Church, and Christ St. Paul’ s Episcopal Church) were confusingly similar.

The Right Reverend Charles G. vonRosenberg v. The Right Reverend Mark J. Lawrence, No. 2:13-587-RMB (D.S.C. Sep. 19, 2019) (diocese decision).

The Right Reverend Charles G. vonRosenberg v. The Right Reverend Mark J. Lawrence, No. 2:13-587-RMB (D.S.C. Sep. 19, 2019) (parish decision).

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