SALT LAKE CITY — A federal appeals court has sided with The Church of Jesus Christ of Latter-day Saints and overturned a lower court ruling that left the faith on the hook for a sexual abuse lawsuit settlement.
In a ruling handed down on Tuesday, a three-judge panel of the 10th U.S. Circuit Court of Appeals ruled that the church's insurance companies are obligated to cover the settlement.
The Church settled a lawsuit filed in West Virginia alleging that Michael Jensen sexually abused children there. Jensen's father and grandfather were considered prominent members of the Church, the judges wrote in their ruling. The victims sued the Church alleging it failed to take precautions that might have prevented the abuse. Right before the case was to go to trial in 2013, the Church settled with the victims and their families.
In 2023, the Church sued its insurance providers, National Union Insurance and ACE Property & Casualty Co., after they refused to cover the sex abuse settlements. In 2025, U.S. District Court Judge Tena Campbell ruled that the insurance companies were not in breach of contract by refusing to pay out on the settlements the Church made.
The LDS Church then appealed to the 10th Circuit Court of Appeals in Denver. In the ruling, the judges unanimously sided with the Church over their insurers, but added: "It’s enough to say that the church was potentially liable for failing to take reasonable precautions between 2007 and 2011 that could have prevented Jensen’s sexual abuse of the settling victims."
Still, the judges declared that the insurance companies should have to cover the settlement payouts when there's dispute over whether numerous instances of abuse are considered one "occurrence" or "multiple occurrences." The Church argued it was one, while the insurers argued it was several.
10th Circuit Court Judge Gregory Phillips wrote that when Utah law is ambiguous, it favors coverage by an insurer.
"Under Utah law, the court’s job is to ask whether the insurer wrote a policy that can reasonably be interpreted in two ways. If so, then the insurer has invited insureds to play 'heads I win tails you lose' with that ambiguous provision," he wrote. "Ambiguous provisions thus carry a high price. To avoid that high price, insurance-policy drafters can clarify those provisions—to the benefit of the insurer, the insured, and the courts."
The Church of Jesus Christ of Latter-day Saints declined to comment to FOX 13 News about the ruling.
