SC Court Issues Temporary Restraining Order to Keep ECUSA from Stealing Diocese’s Identity
Late this afternoon (5:11 p.m. EST), the Circuit Court of South Carolina in Dorchester County (the Hon. Diane S. Goodstein presiding) issued a Temporary Restraining Order (“TRO”) which declares:
No individual, organization, association or entity, whether incorporated or not, may use, assume, or adopt in any way, directly or indirectly, the registered names and the seal or mark of The Protestant Episcopal Church in the Diocese of South Carolina as are set out below or any names or seal that may be perceived to be those names and seal or mark. The registered names and mark that are subject to this order are: the seal of the Diocese of South Carolina as described in its registration with the South Carolina Secretary of State; the name “The Protestant Episcopal Church in the Diocese of South Carolina”, as registered with the South Carolina Secretary of State; the name “The Diocese of South Carolina”, as registered with the South Carolina Secretary of State; and the name “The Episcopal Diocese of South Carolina”, as registered with the South Carolina Secretary of State. Again, this seal and these names are those registered by this Plaintiff corporation [Bishop Lawrence’s Diocese of South Carolina] with the South Carolina Secretary of State.
The order was issued following an ex parte hearing before Judge Goodstein yesterday, and after Bishop Lawrence’s Diocese posted a bond set by the court at $50,000. A hearing may be held “ex parte” in cases of urgency, in order to prevent immediate harm from occurring. The opposing side does not need to be present; indeed, the Episcopal Church (USA) has not yet entered an appearance in the case, and does not seem to have been represented at the hearing.
The purpose of the bond is to ensure that any damages that may be caused by the Court’s issuance of the TRO without first hearing from the opposite side will be covered; such bonds are required by law as a condition of the issuance of a TRO, and the amount is fixed by the Court in each instance based upon individual circumstances.
The immediate urgency requiring the ex parte hearing, from the point of view of Bishop Lawrence and his Diocese, was the scheduled meeting this Saturday of the Episcopal remnant in South Carolina which desires to organize a new diocese within the Episcopal Church (USA) to replace the one that has withdrawn. In issuing notices for the meeting, the national Church and those working in concert with it have claimed the right to use the names and seal described in the Court’s order, which belong (by South Carolina law) to Bishop Lawrence’s Diocese.
The Court’s reasoning for issuing the order states in part:
The Diocese of South Carolina has three registered names and one registered mark and, as shown by affidavit, the Defendant, or others appearing to act in its name or under its control, have allegedly and repeatedly used these names and mark, including those so similar that they are to be the Diocese of South Carolina. This use has clear ability to cause confusion over the identity of the corporate entity of The Diocese of South Carolina. The Diocese of South Carolina has been using these registered names and mark in the ordinary course of its business as the Diocese of South Carolina, both before and after its association with the Defendant. By affidavit Plaintiff states its concern that a meeting scheduled to be held January 26, 2013, by those purporting to be this corporate entity but who in reality are not the corporate entity of the Plaintiff, could intentionally affect the corporate status of those uninformed that the actors are not, in reality, the corporation. In order to avoid any confusion, this Order is issued.
The issue at bar is whether the taking of action by those not authorized with corporate authority will so infringe on the rights of the Diocese of South Carolina, that the Diocese of South Carolina will suffer immediate and irreparable harm for which the law cannot adequately remedy. The Court is convinced this burden has been met. The use of the names and marks of the Diocese of South Carolina can affect its good will, its third party relationships and create confusion among those with whom it deals in the ordinary course of its business. In short, the ongoing business of the Diocese of South Carolina could be irreparably injured if corporate changes occur in its name, implemented by those without actual corporate authority.
The order goes into effect immediately, so it will essentially force the remnant group meeting this Saturday to adopt a different name for the entity it will form, and by which it will be known. The governing documents which are scheduled for approval (a Constitution and Canons based on the former diocesan version before changes were approved in 2011 and 2012) will need to be changed to remove all references to “the Protestant Episcopal Church in the Diocese of South Carolina” and “the Episcopal Diocese of South Carolina.” The order will remain in effect until February 1, when a hearing will be held starting at 9:00 a.m. in the Richland County courthouse on a preliminary (“temporary”) injunction, pending the trial and final resolution of the case. (I am not sure why it is not to be held in the Dorchester County courthouse at St. George; perhaps some South Carolina attorney will enlighten us on injunction procedures there.)
This order, despite its temporary nature, represents a huge advantage gained in the lawsuit which Bishop Lawrence’s Diocese brought early this month, after all attempts had failed to get the remnant Episcopalians to cease voluntarily their appropriations of the diocesan names and corporate seal. (The Diocese announced yesterday that fifteen other parishes had joined in the lawsuit, and that thirteen more are considering joining it later, which would bring the total number of plaintiffs to 44. Perhaps this ruling will provide the spur they need to make their decision.)
The Court has found, based just on the showing presented ex parte by Bishop Lawrence and his capable attorneys, that the plaintiff Diocese made “a prima facie showing . . . as to the likelihood of [its] success on the merits.” In other words, the Diocese showed to the Court sufficient indicia of its ownership of the registered marks (the names and corporate seal) that the Court believes it will prevail in the ultimate lawsuit.
And that represents a substantial uphill burden for ECUSA and its attorneys to overcome. They start off on the wrong foot with the Court, because the remnant group under their direction simply arrogated the names and seal to their own use, without first going into a court to make their case. (Of course, they were under the disability that they will not be legally recognizable in a South Carolina court until after their organizational meeting this Saturday.)
Implicit in the Court’s ruling is an even weightier and more significant finding: that the Diocese of South Carolina has the legal right, under South Carolina law, to withdraw from ECUSA and retain its corporate and individual identity. That finding, once it is formalized in this case, will put the final lie to 815’s mantra that “People may leave the Church, but Dioceses may not.”
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