Leach v. Gateway Church

CourtDistrict Court, E.D. Texas
DecidedSeptember 17, 2025
Docket4:24-cv-00885
StatusUnknown

This text of Leach v. Gateway Church (Leach v. Gateway Church) is published on Counsel Stack Legal Research, covering District Court, E.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Leach v. Gateway Church, (E.D. Tex. 2025).

Opinion

United States District Court EASTERN DISTRICT OF TEXAS SHERMAN DIVISION

KATHERINE LEACH, GARRY K. § LEACH, MARK BROWDER, TERRI § BROWDER, on behalf of themselves and § those similarly situated, § § Plaintiffs, § Civil Action No. 4:24-cv-885 v. § Judge Mazzant § GATEWAY CHURCH, ROBERT § MORRIS, THOMAS M. LANE, KEVIN § L. GROVE, STEVE DULIN, § § Defendants. § MEMORANDUM OPINION AND ORDER Pending before the Court is Defendant Gateway Church’s Motion to Dismiss for Lack of Subject Matter Jurisdiction and Failure to State a Claim and Brief in Support (Dkt. #24), and Defendant Robert Morris’s Motion to Dismiss and Supporting Memorandum Brief (Dkt. #58) (the “Motions”). Having considered the Motions and the relevant pleadings, the Court finds the Motions should be DENIED. BACKGROUND A. Factual Background Plaintiffs Katherine Leach, Garry K. Leach, Mark Browder, Terri Browder, on behalf of themselves and those similarly situated (“Plaintiffs”)—former Gateway Church members and tithers—bring this class action lawsuit against Defendants Gateway Church (“Gateway”) and Robert Morris (“Morris”) (collectively, “Defendants”) (Dkt. #9 at pp. 2–3). Plaintiffs have asserted claims against Defendants for fraud, misrepresentation, and breach of contract arising out of their alleged misappropriation of tithe funds (Dkt. #9 at ¶¶ 67–89). Specifically, Plaintiffs allege Defendants induced Plaintiffs to donate money to Gateway by falsely representing fifteen percent (15%) of all donations would be distributed to global missions and Jewish ministry partners (Dkt. #9 at ¶¶ 17–28). Plaintiffs further allege Defendants guaranteed

Plaintiffs a refund of their donated funds if Plaintiffs were dissatisfied with Gateway’s use of such funds (Dkt. #9 at ¶¶ 37–38). Plaintiffs’ efforts to seek transparency and substantiation for Gateway’s use of Plaintiffs’ donations or to otherwise recover any allegedly misappropriated tithe funds have not been successful (Dkt. #9 at ¶¶ 39–41). Defendants deny Plaintiffs’ allegations (Dkt. #24; Dkt. #58). Gateway is one of the largest nondenominational churches in the United States with current

and past membership exceeding 100,000 members (Dkt. #9 at ¶¶ 3, 11, 13). Morris, a Texas resident, was Gateway’s founder and served as Gateway’s Senior Pastor until June 2024 (Dkt. #9 at ¶¶ 19, 48; Dkt. #24 at p. 14). Gateway was organized under Title 2, Chapter 2 of the Texas Business Organizations Code as a Texas nonprofit religious organization (Dkt. #9 at ¶ 47; Dkt. #24­3 at p. 4). However, Gateway is not just a Texas church (Dkt. #9 at ¶ 5). In addition to their “Online Campus,” Gateway has various physical campuses, nine of which are in Texas and one in Wyoming (Dkt. #9 at ¶¶ 4–5; Dkt. #24 at p. 13 n.3).

Gateway’s tithing members have supported Gateway since its founding, and Gateway uses a platform, PushPay, to process its tithing members’ donations (Dkt. #9 at p. 4; Dkt. #24-2 at ¶¶ 6–8). Through PushPay, donors or tithers self-report their residency information, which Gateway gathers and retains pursuant to tax reporting requirements (Dkt. #24 at p. 10; Dkt. #24-2 at ¶ 7). Based on records kept since 2019, Gateway receives donations from over 20,000 donors per year (Dkt. #24-2 at ¶ 6). From 2019 to 2024, on average, about 90% of the individuals who donated to Gateway in one calendar year self-reported as Texas residents (Dkt. #24-2 at ¶ 6). Because Gateway’s membership exceeds 100,000 members since its founding, Plaintiffs

allege the proposed class will consist of “tens of thousands of persons,” including members that do not reside in Texas (Dkt. #9 at ¶¶ 3–4). Plaintiffs have initially defined the proposed class as follows: (a) “All persons who donated money to Gateway Church in reliance upon the 15% promise for the funds to go to Global Mission work,” and (b) “All persons who want their money back pursuant to the guarantee of Gateway and Robert Morris” (Dkt. #9 at ¶ 54). B. Procedural Background

On November 25, 2024, Gateway filed its Motion to Dismiss (Dkt. #24). On December 16, 2024, Plaintiffs filed their Response (Dkt. #30). On December 19, 2024, the Court received the Brief of First Liberty Institute as Amicus Curiae in Support of Gateway Church’s Motion to Dismiss (Dkt. #34). On December 23, 2024, Defendant Gateway filed its Reply (Dkt. # 37). On February 18, 2025, under the same grounds as Gateway’s Motion, Morris filed his Motion Dismiss (Dkt. #58). On March 25, 2025, Plaintiffs filed their response (Dkt. #70). On April 15, 2025, Morris filed his Reply (Dkt. #71).

The Motions to Dismiss are ripe for adjudication. LEGAL STANDARD I. 12(b)(1) Motion to Dismiss Federal Rule of Civil Procedure 12(b)(1) authorizes dismissal of a case for lack of subject matter jurisdiction when the district court lacks statutory and constitutional power to adjudicate the case. Home Builders Ass’n of Miss., Inc. v. City of Madison, 143 F.3d 1006, 1010 (5th Cir. 1998). If a Rule 12(b)(1) motion is filed in conjunction with other Rule 12 motions, the Court will consider the jurisdictional attack under Rule 12(b)(1) before addressing any attack on the legal merits. Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001).

In deciding the motion, the Court may consider “(1) the complaint alone; (2) the complaint supplemented by the undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the [C]ourt’s resolution of disputed facts.” Lane v. Halliburton, 529 F.3d 548, 557 (5th Cir. 2008) (quoting Barrera-Montenegro v. United States, 74 F.3d 657, 659 (5th Cir. 1996)). The Court will accept as true all well-pleaded allegations set forth in the complaint and construe those allegations in the light most favorable to the plaintiff. Truman v. United States, 26

F.3d 592, 594 (5th Cir. 1994). Once a defendant files a motion to dismiss under Rule 12(b)(1) and challenges jurisdiction, the party invoking jurisdiction has the burden to establish subject matter jurisdiction. See Menchaca v. Chrysler Credit Corp., 613 F.2d 507, 511 (5th Cir. 1980). The Court will grant a motion to dismiss for lack of subject matter jurisdiction only if it appears certain that the claimant cannot prove a plausible set of facts to support a claim that would entitle it to relief. Lane, 529 F.3d at 557. II. 12(b)(6) Motion to Dismiss

The Federal Rules of Civil Procedure require that each claim in a complaint include a “short and plain statement . . . showing that the pleader is entitled to relief.” FED. R. CIV. P. 8(a)(2). Each claim must include enough factual allegations “to raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). A Rule 12(b)(6) motion allows a party to move for dismissal of an action when the complaint fails to state a claim upon which relief can be granted. FED. R. CIV. P. 12(b)(6). When considering a motion to dismiss under Rule 12(b)(6), the Court must accept as true all well-pleaded facts in the plaintiff’s complaint and view those facts in the light most favorable to the plaintiff. Bowlby v.

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Leach v. Gateway Church, Counsel Stack Legal Research, https://law.counselstack.com/opinion/leach-v-gateway-church-txed-2025.