[January 23, 2013]

Babbitt, Johnson, Osborne & Le Clainche and Weil Quaranta, P.A. File Fraud Suit against Church of Scientology Entities on Behalf of Ex-Members, with More in the Wings

A California couple has filed what lawyers say is the first in a series of fraud suits by former Church of Scientology members against five Church entities doing business in Clearwater, FL.

The suit -- filed this morning in United States District Court in the Middle District of Florida by Luis A. Garcia Saz and his wife, Maria Del Rocio Burgos Garcia of Irvine, Calif. (Orange (News - Alert) County) -- accuses the Church of nine counts of fraud and breach of contract over the loss of more than $420,000 invested in Scientology building projects never completed, and counseling services, accommodations and humanitarian initiatives never provided. All along, the suit says, church officials at the highest levels knew they were committing fraud.

Attorneys for the plaintiffs, Theodore Babbitt of Babbitt, Johnson, Osborne & Le Clainche, P.A., of West Palm Beach, and Ronald P. Weil of Weil Quaranta, P.A. of Miami, say they expect this to be the first in a wave of distinct federal suits from ex-Church members around the country, some of which are already in process.

Today's 35-page suit takes specific aim at David Miscavige, who assumed leadership of the Church shortly after the death of founder L. Ron Hubbard in 1986. A copy of the lawsuit has been posted at: www.babbitt-johnson.com. The suit says:

"The Church, under the leadership of David Miscavige, has strayed from its founding principles and morphed into a secular enterprise whose primary purpose is taking people's money."

The suit continues: "In more recent years the Church has added large, high-pressure fundraising drives as its primary source of generating revenue."

The nine-count suit includes five counts of fraud, two counts of unfair and deceptive trade practices and two counts of breach of contract.

The suit places the unfulfilled initiatives and services into three distinct groups:

• Contributions to the Church's "Super Power" building in Clearwater, which the suit alleges amounted to $200 million, less than half of which has been spent on construction, and which, the suit says, remains empty more than 14 years after the 1998 groundbreaking ceremony, despite continuing aggressive fundraising;
• Contributions to global humanitarian initiatives purporting to help eradicate child pornography or aid natural disaster victims "never utilized, vastly underutilized or misappropriated";
• Deposits toward counseling services, accommodations and training that the suit contends were never repaid for services never rendered.

Instead, the suit says, the Church "improperly utilized the contributions and deposits to, among other things, engage ranks of professionals to stifle inquiries into the Church's activities and finances, to intimidate members and ex-members, to finance the lavish lifestyle of Miscavige and to fill the coffers of the Church or its subsidiary/affiliated organizations."

The five entities named in the suit are:

• The Church of Scientology Religious Trust, a nonprofit trust based in Clearwater, established to solicit donations;
• The Church of Scientology FLAG Service Organization, Inc., a Clearwater-based corporation providing ministerial services;
• The Church of Scientology FLAG SHIP Service Organization, a foreign nonprofit ministering religious services aboard a Caribbean ship operating as a religious retreat;
• IAS Administrations, Inc., a Delaware corporation with principal offices in Clearwater and the official membership organization of Scientology, and;
• United States IAS Members Trust, based in Los Angeles but doing substantial business in Clearwater.

(Luis A. Garcia Saz and Maria Del Rocio Burgos Garcia v. the Church of Scientology Religious Trust et al. United States District Court, Middle District of Florida, Case No. 8:13CV220T27TBM, US District Judge James D. Whittemore)

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