Appeals court dismisses LDS tithing fraud class action as too late

Overview

Updated 6 days ago

A federal appeals court on August 31 affirmed that a class-action lawsuit accusing the Church of Jesus Christ of Latter-day Saints of hiding how it spends tithing money was filed too late. The 10th Circuit ruled the plaintiffs should have known about the church's alleged financial misuse after a 2019 IRS whistleblower report made national headlines.

The ruling doesn't decide whether the church committed fraud. It says the three-year statute of limitations expired years before the suit was filed. That likely closes the book on civil tithing cases, leaving only the IRS's long-running whistleblower review.

Why it matters

Tithing donors who believe the LDS Church misused funds have no civil remedy after the 10th Circuit ruled whistleblower reports put plaintiffs on notice.

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Key Indicators

$1.4B

Donated funds plaintiffs say went to City Creek Mall

The class action alleged the church used tithing money for a shopping mall, not charity.

$100B+

Ensign Peak Advisors portfolio size

The church's investment arm manages this portfolio, per the 10th Circuit opinion.

$5M

SEC fine against church in 2023

The Securities and Exchange Commission fined Ensign Peak without requiring an admission of wrongdoing.

3 years

Utah statute of limitations for fraud

Plaintiffs filed in October 2023; the clock had started before October 2020.

Voices

Curated perspectives — historical figures and your fellow readers.

Ever wondered what historical figures would say about today's headlines?

People Involved

David Nielsen

Whistleblower, former Ensign Peak Advisors employee

Reported to IRS in 2019; case still open

James Huntsman

Former LDS Church member and individual plaintiff

Lost lawsuit on the merits

Daniel Chappell, John Oaks, Masen Christensen

Class action plaintiffs

Suit dismissed as filed too late

Harris Hartz

10th Circuit Judge

Wrote unanimous opinion

Organizations Involved

The Church of Jesus Christ of Latter-day Saints

Religious Organization

Defendant in tithing lawsuits

A global church with more than 17 million members and financial assets exceeding $100 billion.

Ensign Peak Advisors

Nonprofit Investment Firm

Manages church's portfolio

The LDS Church's investment arm, created to manage its savings and portfolio.

U.S. Securities and Exchange Commission

Federal regulatory agency

Fined church in 2023

Federal regulator that enforces securities laws and oversees investment firms.

Timeline

December 2019 September 2026

8 events Latest: September 3rd, 2026 · 1 week ago

Tap a bar to jump to that date

September 2026
Salt Lake Tribune reports on ruling
Latest Media

The Tribune reported the appeals court affirmed dismissal, asking whether this ends the whistleblower's allegations.
September 3rd, 2026
August 2026
10th Circuit affirms dismissal
Legal

A three-judge panel ruled unanimously that widespread media coverage put plaintiffs on notice, rejecting their argument that they only learned of the issue from 60 Minutes.
August 31st, 2026
April 2025
District court dismisses class action as too late
Legal

A federal judge ruled the plaintiffs filed about eight months after the three-year statute of limitations expired.
April 2025
October 2023
Class action filed in Utah
Legal

Chappell, Oaks, and Christensen filed a proposed class action in Utah federal court, alleging fraud and unjust enrichment.
October 2023
May 2023
60 Minutes airs tithing investigation
Media

A 60 Minutes segment detailed the whistleblower's allegations, introducing many donors to the claims for the first time.
May 2023
February 2023
SEC fines LDS Church $5 million
Regulatory

The SEC fined Ensign Peak Advisors $5 million over underreporting of the church's investment portfolio, without admitting wrongdoing.
February 2023
January 2020
National media coverage of whistleblower report
Media

The Washington Post, Wall Street Journal, Forbes, Fox News, and CNN covered the report, making it widely known.
January 2020
December 2019
Whistleblower report filed with IRS
Whistleblower

Former Ensign Peak employee David Nielsen filed a report alleging the LDS Church underreported assets and misused tithing funds.
December 2019

Scenarios

Supreme Court denies cert in tithing class action

Likely Resolves by Q2 2027

Discussed by: By Common Consent blog, legal observers

The plaintiffs have 14 days to request an en banc rehearing, then 90 days to petition the Supreme Court. Given the unanimous panel and the narrow procedural basis, both are long shots. If cert is denied, the class action ends.

IRS imposes penalty on LDS Church over tithing

Unlikely Resolves by End of 2028

Discussed by: Watchdog groups, whistleblower's attorneys

David Nielsen's 2019 IRS whistleblower report claims the church underreported assets and directed donations to commercial ventures. A watchdog group alleges the church may owe $90 million in taxes. A penalty would signal the IRS validated the whistleblower's claims.

New tithing suit filed after 2026 ruling

Unlikely Resolves by End of 2027

Discussed by: Plaintiffs' attorneys (hypothetical)

A donor who can show they only learned of the alleged fraud recently could file a new suit within three years of discovery. But the 10th Circuit's 'objective discovery' standard makes this very hard. The court said the whistleblower report was widely known.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

1997-2000

Bishop Estate (1997-2000)

The Bishop Estate, which funds Hawaii's Kamehameha Schools, held $10 billion in charitable assets. In 1997, the state attorney general began investigating its five trustees for misusing funds for personal and political purposes.

Then

Courts removed all five trustees and ordered restitution; the trust was restructured.

Now

The case became a template for how large charitable trusts can be held accountable through legal action, even when no criminal charges are filed.

Why this matters now

Both cases involve enormous charitable institutions accused of diverting donor funds. The Bishop Estate was remedied through court action; the LDS Church's tithing suits were barred by the statute of limitations.

2004-2007

Vioxx litigation (2004-2007)

Merck faced thousands of lawsuits over its painkiller Vioxx, which was linked to heart attacks. Courts allowed many claims to proceed because Merck had allegedly concealed data about the risks, meaning the statute of limitations didn't start until plaintiffs discovered the concealment.

Then

Merck paid $4.85 billion to settle claims, and the drug was pulled from the market.

Now

The cases established that concealed wrongdoing can delay the statute of limitations, but public information can also start the clock.

Why this matters now

In Vioxx, concealment delayed the clock. In the LDS case, the 10th Circuit said the 2019 whistleblower report was so widely publicized that it started the clock, even if plaintiffs missed the coverage.

2009-2012

UBS whistleblower case (2009-2012)

In 2009, UBS paid a $780 million settlement and turned over client data to the U.S. after a whistleblower exposed its cross-border tax evasion. The whistleblower, Bradley Birkenfeld, received a $104 million award, the largest in IRS history.

Then

UBS paid the penalty and disclosed thousands of account holders; Birkenfeld received a record award.

Now

The case demonstrated that a single IRS whistleblower can force a major institution to change its financial practices.

Why this matters now

David Nielsen's whistleblower report to the IRS follows the same mechanism. But unlike UBS, the LDS Church has not faced a tax penalty, and the civil suits stemming from the report have now been dismissed.