Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-13-03160/USCOURTS-ca8-13-03160-0/pdf.json

Nature of Suit Code: 470
Nature of Suit: Civil (Rico)
Cause of Action: 

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United States Court of Appeals

For the Eighth Circuit

___________________________

No. 13-3160

___________________________

Hutterville Hutterian Brethren, Inc., a South Dakota nonprofit corporation; George

Waldner, Sr.; Tom Waldner; Kenneth Waldner, individually and as officers and

directors of Hutterville Hutterian Brethren, Inc.

lllllllllllllllllllll Plaintiffs - Appellants

v.

Jeffrey T. Sveen; Rodrick L. Tobin; Harvey C. Jewett; Siegel, Barnett & Schutz,

L.L.P., a South Dakota limited liability partnership

lllllllllllllllllllll Defendants - Appellees

____________

Appeal from United States District Court 

for the District of South Dakota - Aberdeen

____________

 Submitted: September 23, 2014

 Filed: January 13, 2015

____________

Before RILEY, Chief Judge, LOKEN and KELLY, Circuit Judges.

____________

RILEY, Chief Judge.

This case publishes a new chapter in the legal struggle for control of Hutterville

Hutterian Brethren, Inc. (Hutterville), a South Dakota religious nonprofit corporation

whose members have split into factions, mirroring a larger division in the Hutterite

religion. Though both factions claim the right to control Hutterville, the South

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Dakota Supreme Court has ruled this issue is not constitutionally determinable by

secular courts under either the federal constitution or the state constitution because

the questions of corporate governance cannot be answered without delving into

disputes of ecclesiastical polity and hierarchy which “are shielded from judicial

1

scrutiny under the First Amendment.” HuttervilleHutterianBrethren, Inc. v. Waldner

(Hutterville I), 791 N.W.2d 169, 179-80 (S.D. 2010) (no jurisdiction to answer

governance issues); see also Wipf v. Hutterville Hutterian Brethren, Inc. (Hutterville

II), 808 N.W.2d 678, 686 (S.D. 2012) (no jurisdiction to mandate corporate

dissolution). With the South Dakota Supreme Court effectively leaving a legal

stalemate, the leaders of one faction brought the present suit against several attorneys

and a law firm who allegedly conspired with leaders of the other faction to

“manufacture” the apparent religious schism and improperly place the conspiring

faction leaders in command of Hutterville. The district court dismissed the case, 2

reasoning it could not determine the presence of standing under Article III of the

United States Constitution without reaching the same religious impasse that halted

the South Dakota state courts. Equipped with appellate jurisdiction, see 28 U.S.C.

§ 1291, we affirm.

I. BACKGROUND

A. History

As the South Dakota Supreme Court explained, the Hutterite religion

descends—like the Amish and Mennonite religions—fromthe Anabaptist movement

Strictly defined, “ecclesiastical” relates specifically to Christianity, see New 1

Oxford American Dictionary 549 (3d ed. 2010) (defining the term as “of or relating

to the Christian Church or its clergy”), but we use the term in a more colloquial sense

to mean “of orrelating to the formal and established institutions or government of any

religion,” Merriam Webster’s Third New International Dictionary 718 (1993).

The Honorable Lawrence L. Piersol, United States District Judge for the

2

District of South Dakota.

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in sixteenth-century Germany and takes its name from its founder, Jacob Hutter, who

was burned at the stake in Innsbruck in 1536. See Hutterville II, 808 N.W.2d at 680;

Decker ex rel. Decker v. Tschetter Hutterian Brethren, Inc., 594 N.W.2d 357, 359

(S.D. 1999). In the 1870s and 80s, the Hutteritesfled religious persecution in Europe,

relocating in Canada and the northern United States, where their colonies remain

today. See Decker, 594 N.W.2d at 359. One of the more distinguishing

characteristics of the Hutterite faith is what the South Dakota Supreme Court referred

to as a “community of goods”—Hutterites must disavow individual property

ownership in favor of a communal lifestyle within each colony. See Hutterville II,

808 N.W.2d at 680.

As the Waldners explain, the Hutterian Brethren Church (Hutterian Church)

is organized into three conferences—the Dariusleut, Lehrerleut, and Schmiedeleut

Conferences—with each Hutterite colony belonging to one of these conferences. 

Hutterville Colony (the congregation associated with Hutterville, the corporation) is

a South Dakota colony historically belonging to the Schmiedeleut Conference. See

id. Consistent with the community-of-goods principle, members of Hutterville

Colony live a communal lifestyle with all of the colony’s real and personal property

belonging to Hutterville. See id. Hutterville itself is a South Dakota nonprofit

corporation, managed by an elected board and elected officers, who operate

Hutterville as a communal farm for the colony. Formed with the stated purpose of

promoting the Hutterite faith and Hutterian Church, Hutterville conductsthe colony’s

business and owns all property in lieu of individual property ownership.

In 1983, when Hutterville and HuttervilleColony firstformed, Reverend Jacob

Kleinsasser was the Senior Elder (i.e., the spiritual and ecclesiastical leader) of the

Schmiedeleut Conference. See Decker, 594 N.W.2d at 360. According to the

complaint, this position made Rev. Kleinsasser “the final arbiter or decision-maker

regarding issues affecting the members of the Church.”

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Around 1992, a large group of Hutterite ministers repudiated Rev.

Kleinsasser’s leadership in response to accusations of impropriety, and these

ministers opted instead to follow Reverend Joseph Wipf. See id. The remaining

ministers supported Rev. Kleinsasser. See id. Colonies following Rev. Wipf

(forming the Schmiedeleut “Group 2”) solidified their division in 1993 by ratifying

a new constitution which purported to institute new conference leadership. See

Hutterville II, 808 N.W.2d at 680. Rev. Kleinsasser’s colonies (forming the

Schmiedeleut “Group 1”) refused to adopt the 1993 constitution, preserving their

position in favor of Rev. Kleinsasser. See id. As the South Dakota Supreme Court

explained, “[e]ach Group maintained that it was the true Schmiedeleut.” Id.

(emphasis added) (quotations omitted).

Meanwhile, according to the complaint, Reverend George Waldner,

Sr.—Hutterville Colony’s minister and ecclesiastical leader, as well as Hutterville’s

president and one of its directors—remained loyal to Rev. Kleinsasser and insisted

that Hutterville Colony belong to Group 1 of the Schmiedeleut Conference. Not

everyone in the Hutterville Colony agreed, and the members of Hutterville split into

Group 1 (Waldner faction) and Group 2 (Wipf faction) supporters. See id.

Fifteen yearslater, the tensions ofthisinternalsplit boiled over. The complaint

alleges that through a series of “sham” corporate meetings in late 2008 and early

2009, a number of Wipf faction members were improperly elected to replace Waldner

faction officers and directors. Among these was Johnny Wipf, who claimed to have

been elected president to replace Rev. Waldner. Rev. Waldner and his faction

challenged the validity of these elections and claimed Waldner faction members still

maintained control. At loggerheads over who controlled the corporation, each faction

began having its own member and board meetings and conducted business in the

name of the company, all the while condemning the other faction’s purported officers

and directors as fraudulent imitators.

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B. Hutterville’s State Court Litigation

In August of 2009, Johnny Wipf and other Wipf faction members brought suit

in South Dakota state court against Rev. Waldner, Tom Waldner, and Kenneth

Waldner (Waldners), “seeking a declaration that[the Wipf faction members] were the

properly elected directors of Hutterville.” Hutterville I, 791 N.W.2d at 172. Using

Hutterville’s bylaws and articles of incorporation, the state trial court determined the

Wipf faction members were its duly elected directors and officers. See id. After the

unfavorable decision, Rev. Waldner, who remained minister ofthe Hutterville church,

and Rev. Kleinsasser signed a “Resolution of Action Taken by Hutterian Church

Group I,” which states: 

The undersigned, being duly authorized by Hutterian Church Group I to

act on its behalf, hereby declare thatJohnny Wipf, Alvin Hofer and Jake

Hofer Sr., residents of Hutterville Hutterian Colony, are hereby

excommunicated/removed as Members of the Hutterian Church,

effective as of August 19, 2009. As a result of such excommunication,

the said Johnny Wipf, Alvin Hofer and Jake Hofer Sr. shall no longer be

considered Members of Hutterian Church Group I, nor shall they be

entitled to attend services or participate in Church activities.

See id. at 172. According to the Waldner faction, excommunication from the local

church made these Wipf faction members ineligible for corporate membership in

Hutterville and unable to hold a director or officer position. See id. at 173.

Challenging the validity of the excommunication, the Wipf faction asked the

state trial court to declare that the excommunication did not affect its conclusion that

the Wipf faction members were the duly elected directors and officers of Hutterville. 

See id. at 172-73. Before a hearing could be held on the issue, the Waldners “moved

to dismiss [the Wipf faction’s] complaint for lack of subject matter jurisdiction.” Id.

at 173. The state trial court agreed jurisdiction was lacking and dismissed the Wipf

faction’s lawsuit because the matter required the court to decide disputed religious

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questions. See id. at 174. Accepting the Waldners’ argument, the South Dakota

Supreme Court affirmed, reasoning the federal constitution and the South Dakota

constitution prohibit state courts from resolving disputes of religious doctrine and

ecclesiastical polity, despite the presence of a secular claim. See id. at 179-80. The

court rejected the argument that control of the Hutterville corporation could be

determined by a neutral reading of its articles of incorporation and bylaws because

fundamental questions—such as status as a corporate member, director, or

officer—were “inseparable” fromdisputed religious questions of churchmembership

and leadership. Id. at 179.

In a second state action, the Wipf faction alleged deadlock and misapplication

of corporate assets were causing irreparable harm to Hutterville’s business and

requested the dissolution of Hutterville and appointment of a receiver to wind up its

business. See Hutterville II, 808 N.W.2d at 681. The trial court agreed and appointed

a receiver, HarveyC. Jewett. See id.; see also Wipf v. Hutterville Hutterian Brethren,

Inc. (Hutterville III), 834 N.W.2d 324, 328 (S.D. 2013). The South Dakota Supreme

Court reversed, concluding “the underlying religious controversies over church

leadership so pervade the dissolution of the religious corporation that the dissolution

is beyond a secular court’s jurisdiction.” Hutterville II, 808 N.W.2d at 686.

Before this ruling, Jewett moved for approval of his accounting and for

payment of his fees and expenses. See Hutterville III, 834 N.W.2d at 329. The trial

court approved Jewett’s actions and accounting. See id. In the ensuing months, the

Waldners challenged aspects of the circuit court’s approval of Jewett’s accounting,

but the trial judge stood by its initial ruling and, on October 25, 2012, terminated the

receivership and discharged Jewett. See id. at 330-31. On appeal, the South Dakota

Supreme Court affirmed the trial court, concluding the Waldners’ allegations that

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Jewett was an interested party had been forfeited by a failure to object, reasoning any

3

procedural errors in his appointment were harmless, concluding judicial immunity

protected Jewett from liability, and rejecting on the merits the Waldners’ claims of

Jewett’s bad faith. See id. at 334-36.

C. This Lawsuit

In April 2012, as the factions were contesting the trial judge’s ruling on

Jewett’s accounting, the Waldners filed the present action against Jewett, Siegel

Barnett, and two Siegel Barnett attorneys named Rodrick L. Tobin and Jeffrey T.

Sveen (collectively, attorneys), asserting claims under both the Racketeer Influenced

and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961-1968, and state law. The

Waldners raise these claims in both their individual capacities and in Hutterville’s

name in their “official” capacities as purported corporate directors and officers.

The Waldners allege the attorneys, despite their fiduciary and ethical duties to

Hutterville, worked with the Wipf faction to “manufacture” a dispute by which to

“wrest control” of Hutterville, its business, and its assets “from its duly elected

officers and directors” and in favor of the attorneys’ Wipf faction collaborators. In

particular, the Waldners allege SiegelBarnett attorneys met with Wipf faction leaders

and explained that they would not be able to help the Wipf faction openly, but would

“work behind the curtain” to help the Wipf faction take control of Hutterville. While

representing Hutterville, the attorneys purportedly assisted the Wipf faction in

making its sham elections appear legitimate by creating genuine-looking corporate

minutesfor numerous Wipf faction corporate meetings. The attorneys also allegedly

instructed or advised the Wipf faction to take numerous actions depriving the

Waldner faction of effective control of much of Hutterville’s property. For example,

The Waldners also claim “Jewett ha[d] been a member of” Siegel, Barnett &

3

Schutz, LLP law firm (Siegel Barnett) “for approximately 30 years” and was

“associated with” the firm at the time of his receivership appointment.

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the Siegel Barnett attorneys allegedly “encouraged and assisted Wipf . . . to open a

bank account at Great Western Bank [despite Hutterville’s relationship with U.S.

Bank], and to deposit into that account the proceeds of the sale of crops grown and

livestock raised on Hutterville property.” Additionally, the Waldnersmaintain Jewett

held “himself out . . . as an ‘independent’ receiver, with loyalty only to the Court that

appointed him,” when in fact he was affiliated with Siegel Barnett and was “[a]cting

in concert with Sveen, Tobin, and Siegel Barnett” to aid the Wipf faction’s takeover

and “to break down any resistence to [his] unlawful receivership.”

The Waldners assert that by assisting the Wipf faction while purporting to

represent Hutterville, the attorneys altered documentsto impede official proceedings;

helped transport stolen property known to have been taken unlawfully or through

fraud; and committed numerous acts of wire, mail, bank, and common law fraud. The

Waldners aver these actions constituted a pattern of predicate acts of racketeering

activity and allege the attorneys violated all four subsections of 18 U.S.C. § 1962. 

The Waldnersfurther allege that by assisting the Wipf faction, the attorneys breached

their fiduciary duties to Hutterville and its duly elected agents (i.e., the Waldners),

committed common law fraud, and violated S.D. Codified Laws § 20-10-1.

The attorneys jointly filed a motion to dismiss under Fed. R. Civ. P. 12(b)(1)

and (6). Granting the motion, the district court dismissed without prejudice all of the

claims made in Hutterville’s corporate name, reasoning that for the Waldnersto have

standing in their purported official capacities, it must be known which faction truly

controls Hutterville. Citing the South Dakota Supreme Court decisions, the district

court concluded this inquiry was impermissible because determining the “true”

officers, directors, and members of Hutterville required the court to resolve religious

and ecclesiastical disputes beyond the province of secular courts. The district court

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also dismissed with prejudice the Waldners’ individual claims against Jewett and the

other defendants “for lack of any property right to make these types of property

damages claims due to their individual renunciation of individual property.” 

Specifically referring to the Waldners’ individual capacity claims against Jewett, the

district court also noted dismissal was warranted “as[Jewett] has been determined by

the South Dakota Supreme Court to partake of judicial immunity as a receiver.” The

Waldners timely appealed.

II. DISCUSSION

Religious disputes can often stray outside the ecclesiastical arena into areas of

secular concern. See, e.g., Jones v. Wolf, 443 U.S. 595, 602, 605 (1979) (“The only

question presented by this case is which faction of the formerly united . . .

congregation is entitled to possess and enjoy the [real] property [in question].”);

Kedroff v. St. Nicholas Cathedral of Russian Orthodox Church in N. Am., 344 U.S.

94, 95 (1952) (deciding disputed right to use and occupy a church); Watson v. Jones,

80 U.S. (13 Wall.) 679, 681 (1871)(considering church property dispute between two

intra-church groups). In these instances, secular courts can enter the fray when called

upon to do so, but theymay not resolve disputes of religious doctrine or ecclesiastical

polity, because such a resolution would violate the First and Fourteenth Amendments

to the United States Constitution. See Jones, 443 U.S. at 602, 605; accord Serbian

E. Orthodox Diocese for U.S. & Can. v. Milivojevich, 426 U.S. 696, 708-09 (1976). 

Such issues are reserved for “the highest ecclesiastical tribunal within a church of

hierarchical polity” whose conclusions on these issues “shall not [be] disturb[ed]” by

secular courts. Milivojevich, 426 U.S. at 709; accord Jones, 443 U.S. at 602. 

However, a court need not defer to an ecclesiastical tribunal on secular questions and

permissibly may resolve a matter “by applying ‘neutral principles of law.’” Church

of God in Christ, Inc. v. Graham, 54 F.3d 522, 525-26 (8th Cir. 1995) (quoting Jones,

443 U.S. at 602).

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Following these principles, the South Dakota Supreme Court has twice

declared itself incapable of resolving Hutterville’s corporate governance dispute

because religious questions pervade the analyses. See Hutterville II, 808 N.W.2d at

686; Hutterville I, 791 N.W.2d at 179-80. This religious impasse proves decisive

here too.

A. Standing for Claims in Hutterville’s Name4

We must first address the presence of Article III standing for the Waldners’

official capacity claims. See Brown v. Medtronic, Inc., 628 F.3d 451, 455 (8th Cir.

2010). To establish constitutional standing, the “person invoking the power of a

federal court must” “prove that he has suffered a concrete and particularized injury

that is fairly traceable to the challenged conduct, and is likely to be redressed by a

favorable judicial decision.” Hollingsworth v. Perry, 570 U.S. ___, ___, 133 S. Ct.

2652, 2661 (2013). “[E]ach element must be supported in the same way as any other

matter on which the plaintiff bears the burden of proof, i.e., with the manner and

degree of evidence required at the successive stages of the litigation.” Lujan v.

Defenders of Wildlife, 504 U.S. 555, 561 (1992). Where, as here, the case has

progressed only to “the pleading stage, general factual allegations of injury resulting

from the defendant’s conduct may suffice, for on a motion to dismiss we ‘presum[e]

that general allegations embrace those specific facts that are necessary to support the

claim.’” Id. (alteration in original) (quoting Lujan v. Nat’l Wildlife Fed’n, 497 U.S.

871, 889 (1990)).

The district court questioned whether Hutterville could show an injury-in-fact

if the Waldners were not in control of the corporation. The district court explained

that determining the existence of injury-in-fact “entails the fundamental question of

Because the Waldners’ official capacity claims effectively are claims by 4

Hutterville itself, see Hafer v. Melo, 502 U.S. 21, 25 (1991), we address them assuch

and refer to all claims in Hutterville’s name as the “official capacity claims.”

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whether the [Waldners] can bring claims on behalf of [Hutterville], the corporate

entity that holds the property of the colony.” The district court concluded the First

Amendment would not permit the court to resolve this question. The attorneys

similarly propose a First Amendment problem is inevitable because any injury to

Hutterville “depends upon which faction has authority to speak and act for it” and

“Johnny Wipf, the leader of the Wipf faction, has made clear that his faction has not

authorized [this] litigation.”

These are not questions of Article III standing. As the Waldners point out, the

corporate control issue has “inextricably bound up” the jurisdictional question of

injury with the merits of their claims, both of which are premised upon the attorneys

acting in concert with Hutterville’s false agents to obtain Hutterville property. The

Waldners are correct that for purposes of standing, we cannot question who controls

Hutterville or acts as its authorized agents. Such questions attack the Waldners’

ability to prove their cause of action, yet “standing in no way depends on the merits

of the plaintiff’s contention that particular conduct is illegal.” Warth v. Seldin, 422

U.S. 490, 500 (1975). “It is crucial . . . not to conflate Article III’s requirement of

injury in fact with a plaintiff’s potential causes of action, for the concepts are not

coextensive.” Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 591 (8th Cir. 2009).

It remainsto be seen whether the Waldners can prove Sveen, Wipf, and the rest

acted unlawfully, and “[i]f [the Waldners’] allegations of misconduct on the part of

[the attorneys] have merit, and that is the hypothesis upon which we must proceed at

this stage of the case, [the Waldners] clearly ha[ve] standing in the constitutional

sense.” Novartis Seeds, Inc. v. Monsanto Co., 190 F.3d 868, 871 (8th Cir. 1999)

(emphasis added); see also Vietnam Veterans of Am. v. Shinseki, 599 F.3d 654, 658

(D.C. Cir. 2010) (“[T]he merits must be assumed when considering standing.”);

Braden, 588 F.3d at 592 (“We must assume . . . [plaintiff’s] allegations are true.”). 

The complaint details numerousinjuries to the corporation—including the conversion

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of its property and livestock, redirection of payments owed to Hutterville, and the

unapproved re-titling of Hutterville-owned vehicles—inflicted by the purported

conspiracy in favor of the allegedly expelled Wipf faction members. In one such

instance, the complaint alleges Sveen, as part of the conspiracy, instructed Wipf to

record a warranty deedWipf “had fraudulently executed as Hutterville’s ‘president,’”

which “purported to convey from Hutterville to himself as trustee and for no

consideration, all the real property described therein.” As alleged in the complaint,

the injury is undoubtedly concrete and particularized; it is directly attributable to

Sveen and Wipf’s participation in the alleged conspiracy; and redress is readily

available in the form of damages or equitable relief. Assuming the merits, the three

prongs of Article III standing have been pled. See Perry, 570 U.S. at ___, 133 S. Ct.

at 2661; Lujan, 504 U.S. at 560-61.

While wrong to dress the issue as one of Article III standing, the district court

correctly recognized a crucial defect in the Waldners’ claims.

B. Corporate Governance

We agree with the Waldners that the “only question” raised by the attorneys’

arguments is “who may authorize the corporation to act.” “[W]hether the person

bringing the suit has authority to use the courts of that jurisdiction” is a “question of

capacity to sue.” Moore v. Matthew’s Book Co., 597 F.2d 645, 647 (8th Cir. 1979)

(per curiam). For corporations in federal court, capacity to sue depends on state law. 

See Fed. R. Civ. P. 17(b)(2). In Moore, we held that a single trustee lacked capacity

to sue as the trustee of a corporation whose charter had been forfeited, because state

law gave “the trustees” the power to sue in the corporate name. Moore, 597 F.2d at

647 (emphasis added) (quotations omitted). Because the trustee was “merely a

trustee, not the trustee,” the trustee “lacked capacity to sue” “[w]ithout joinder of the

other trustees.” Id. In a similar sense, whether the Waldners are directors and

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officers of Hutterville naturally determines whether they have “official capacities” by

which to sue in Hutterville’s name.5

As a South Dakota nonprofit corporation, see S.D. Codified Laws § 47-23-

28(3), Hutterville has the “power to sue and be sued, complain and defend, in its

corporate name.” Id. § 47-22-53. Given this form, it “can act only through

individuals acting as [its] agents,” which comes down to the board of directors—its

“ultimate governing body.” Nelson v. WEB Water Dev. Ass’n, Inc., 507 N.W.2d

691, 695 (S.D. 1993) (quotations omitted). Here, we confront the foreshadowed

religious question: Which faction’s members are Hutterville’s rightful directors, that

is, Hutterville’s governing body?

The Waldners have shown corporate control is also a core premise of their

causes of action, intertwined with the merits of both their official and individual

capacity claims. See supra section II.A. The Waldners concede their RICO claims

6

Authorities suggesting “a third party may not object” “to an officer’s lack of 5

authority to initiate a lawsuit” “if [the] corporation does not object,” 9 Carol A. Jones,

Fletcher Cyclopedia of the Law of Corporations § 4216 (2008 rev. vol.); see, e.g.,

Farmers Union Oil Co. of New England v. Maixner, 376 N.W.2d 43, 46 (N.D. 1985);

Vill. of Brown Deer v. City of Milwaukee, 114 N.W.2d 493, 497 (Wis. 1962), are not

to the contrary, because it is undisputed the purported Wipf faction officers and

directors condemn the Waldners’ use of Hutterville’s name in bringing the present

lawsuit.

We do not consider the Waldners’ individual capacity claims to the extent they 6

allege harmonly to Hutterville’s corporate assets and business, because the Waldners

lack standing to assert such claims even if we assume they can prove they are

Hutterville’s duly elected officers and directors. See Alternate Fuels, Inc. v. Cabanas,

538 F.3d 969, 973 (8th Cir. 2008) (“[A] corporate officer cannot maintain a personal

action against a third party for harm caused to the corporation, unless the officer

alleges a direct injury not derivative of the company’s injury.”).

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depend on the Waldners’ rightful control, explaining that no predicate act of

racketeering activity can be proven unless the Waldner faction—and not the Wipf

faction—holds rightful control of Hutterville’s director and officer positions. See

Gallagher v. Magner, 619 F.3d 823, 841 (8th Cir. 2010) (requiring a “predicate act”

of racketeering activity under 18 U.S.C. § 1961(1)); see also Sedima, S.P.R.L. v.

Imrex Co., 473 U.S. 479, 495 (1985). A review of the Waldners’ complaint shows

their individual capacity state law claims similarly depend on which faction has

rightful control. As the Waldners make clear, the goal of this appeal is to obtain for

Hutterville “the opportunity to conduct discovery and prove at an evidentiary hearing

that there is no bona fide ‘religious dispute,’ and that the [Waldners] are, in fact,

Hutterville’s officers and directors.” (Second emphasis added).

Thus, the question of who rightly controls Hutterville is the unavoidable nub

of the Waldners’ official and individual capacity claims, whether framed in terms of

capacity to sue (for the official capacity claims) or the merits.

7

C. First Amendment and Judicial Estoppel

Knowing that to resolve the disputes in this case this court must decide who

controls Hutterville, we turn to whether the First Amendment will permit such an

inquiry. The district court answered this question in the negative, reasoning the

governance issue “is deeply intertwined with the religious dispute of who is properly

The Waldners argue they, like the plaintiff in Drevlow v. Lutheran Church,

7

Mo. Synod, 991 F.2d 468, 472 (8thCir. 1993), should be given an evidentiary hearing

or “an opportunity to prove [their] secular allegations at trial.” Unlike Drevlow, the

path to the Waldners’ requested relief necessarily leads through the religious dispute. 

See id. at 471-72 (“At the present stage of this litigation we are unable to predict that

the evidence offered at trial will definitely involve the district court in an

impermissible inquiry” because “[t]he [defendant] Synod has not offered any

religious explanation for its actions which might entangle the court in a religious

controversy.”).

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a member of the true church and therefore also a member of the colony and a voting

member of Hutterville.” The Waldners counter that church membership is central to

the governance question but that there is no live dispute because, in their view,

“Hutterville has always been a . . . Group 1 Hutterite Church Colony, and the Group

1 Church hierarchy conclusively determined that Wipf is not a member and has no

right to speak or act for Hutterville.” They therefore claim, “Because civil courts are

bound by and cannot question the Church’s determination of its own membership,

there is no ‘religious dispute.’” The Waldners demand “the opportunity to prove . . .

that any claimed ‘religious dispute’ is a sham and a fraud and that they are, in fact,

Hutterville’s officers and directors or were unlawfully removed.”

The Waldners’ current arguments contradict the position they took before the

South Dakota Supreme Court. Rather than argue the state court did have jurisdiction

and should decide the governance question in their favor (as they argue here), the

Waldners in state court argued the question was untouchable and could not be

resolved by a secular court in either faction’s favor. In Hutterville I, the Waldners

maintained a court could not determine “who controls Hutterville Hutterian Brethren,

Inc.” without determining “the identity of [Hutterville church’s] decision making

body” or members. Brief of Appellees, Hutterville I, 791 N.W.2d 169 (No. 25553),

2010 WL 5516994, at *12, 19-20. Both questions, the Waldners asserted, were

“religious in nature and reserved to the church.” Id. at *20. Because “the parties

dispute[d] the validity of the church’s excommunication of [the Wipf faction

members] and who the true senior elders of the church [we]re,” the Waldners

reasoned that inquiry into the governance question entailed an unconstitutional

intrusion by the court. Id. In Hutterville II, the Waldners similarly argued, “[T]he

decision as to who are members of Hutterville Hutterian Brethren, Inc., cannot be

decided without extensive inquiry into religious doctrine and beliefs of the Hutterian

faith and South Dakota courts have no constitutional basis to interfere.” Brief of

Appellant, Hutterville II, 808 N.W.2d 678 (No. 25877), 2011 WL 7497040, at *20. 

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In both instances, the South Dakota Supreme Court agreed, ruling it could not

determine church leadership or who was a member of Hutterville Colony’s church. 

See Hutterville II, 808 N.W.2d at 686; Hutterville I, 791 N.W.2d at 179-80. 

Having twice succeeded in foreclosing judicial determination and recognition

of the proper directors and officers of Hutterville, the Waldners bring this federal

action questioning the legitimacy of the Wipf faction’s claim to Hutterville and

asserting the legitimacy of their own offices. We will not permit the Waldners now

to claim the religious questions are a “sham” or that these issues have been resolved

all along. Nor will we permit the Waldners “the opportunity to prove . . . that they

are, in fact, Hutterville’s officers and directors or were unlawfully removed.” “[T]he

doctrine of judicial estoppel ‘generally prevents a party from prevailing in one phase

of a case on an argument and then relying on a contradictory argument to prevail in

another phase.’” EEOC v. CRST Van Expedited, Inc., 679 F.3d 657, 679 (8th Cir.

2012) (quoting New Hampshire v. Maine, 532 U.S. 742, 749 (2001)). In applying the

doctrine, we look to three non-exclusive factors:

“First, a party’s later position must be clearly inconsistent with its earlier

position. Second, courts regularly inquire whether the party has

succeeded in persuading a court to accept that party’s earlier position,

so that judicial acceptance of an inconsistent position in a later

proceeding would create the perception that either the first or the second

court was misled. Absent success in a prior proceeding, a party’s later

inconsistent position introduces no risk of inconsistent court

determinations, and thus poses little threat to judicial integrity. A third

consideration is whether the party seeking to assert an inconsistent

position would derive an unfair advantage or impose an unfair detriment

on the opposing party if not estopped.”

Id. (quoting New Hampshire, 532 U.S. at 750-51). The Waldners successively

convinced the South Dakota Supreme Court that (1) the question of which faction has

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authority to direct Hutterville required determinations of church membership, the

validity of excommunications, and the proper designation ofthe “true” Schmiedeleut,

and (2) inquiry into these questions were impermissible for secular courts. See

Hutterville I, 791 N.W.2d at 175-80. 

The Waldners do not contend these questions have been resolved since that

time. When questioned at oral argument in this case, the Waldners could not identify

any intervening ecclesiastical decisions which might have settled the questions. Nor

do they identify newly discovered evidence resolving the governance issues in a way

that permits the court to circumvent religious inquiries. At most, the Waldners argue

the attorneys “invented, orchestrated and engineered a shamand fraudulent‘religious

dispute’ to conceal their scheme and to shield themselvesfromscrutiny and liability.” 

The Waldners fail to explain what it means to have a “fraudulent” religious dispute,

and even if correct that the attorneys orchestrated the dispute between Hutterville’s

factions, this does not negate the religious questions they previously

highlighted—i.e., which excommunications were valid and which isthe true church. 

These issues, the Waldners once argued, are both unavoidable and unanswerable, and

we fail to see how the origin of the dispute makes these inquiries now any less

necessary or any less controlled by religious matters.

III. CONCLUSION

We affirm the judgment and rulings of the district court, dismissing the official

capacity claims without prejudice and the individual capacity claims with prejudice.

______________________________

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