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Hush-Hush Money

After more than seventeen years of litigation, Lawrence Wollersheim knows that talk isn't cheap--not when you're talking to lawyers and your life's work happens to involve badmouthing the Church of Scientology. But the price of silence is even higher. Too high, in Wollersheim's estimation, which is why he says he...
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After more than seventeen years of litigation, Lawrence Wollersheim knows that talk isn't cheap--not when you're talking to lawyers and your life's work happens to involve badmouthing the Church of Scientology. But the price of silence is even higher. Too high, in Wollersheim's estimation, which is why he says he walked away from an alleged settlement offer by the church that would have netted him and a few colleagues $12 million in exchange for abandoning their crusade against Scientology.

Wollersheim is one of the founders of the Fight Against Coercive Tactics Network (FACTNet), a Boulder-based computer archive that's been embroiled in a copyright dispute with Scientology organizations in a federal courtroom in Denver for the past two years. The lawsuit was triggered by a FACTNet boardmember's efforts to publicize Scientology's secret, upper-level scriptures by distributing excerpts on the Internet ("Nightmare on the Net," March 6). Wollersheim recently went public with his version of the church's efforts to settle the case, posting a ten-page account of the negotiations on FACTNet's Web page. The manifesto has provoked widespread discussion of the supposed $12 million offer in the electronic newsgroup alt.religion.scientology, a cyberspace forum for Scientology dissidents.

"Because of the bad faith involved, I cannot hold back what went on," Wollersheim says. "The general public and people who may be considering other Scientology settlement offers need to know what is going on behind closed doors."

Church officials, though, have another word for what happened in their out-of-court discussions with FACTNet: extortion. "The church absolutely denies making any $12 million offer," says Michael Rinder, a member of the board of directors of the Church of Scientology International. "That's a total and utter lie."

Rinder, whom Wollersheim says he met with several weeks ago in Los Angeles at the start of the negotiations, likens Wollersheim's tactics to those of Autumn Jackson, the woman recently convicted of trying to extort millions from entertainer Bill Cosby. "We believe Mr. Wollersheim has been engaged for some time in an attempt to extort the church," he says. "We have an ongoing complaint with federal authorities about the matter."

Wollersheim, though, insists that the church's representatives had agreed to a figure of $12 million at the start of settlement discussions two months ago. The negotiations broke down over the next six weeks, he says, as his adversaries sought to impose increasingly restrictive conditions on the settlement, including a requirement that the FACTNet litigants--Wollersheim, boardmember Arnie Lerma and ex-boardmember Robert Penney--no longer speak out against the church or assist in any anti-Scientology litigation.

At present, Wollersheim is the only participant commenting on the supposed details of the offer. Settlement negotiations are usually deemed confidential; even one of Wollersheim's own attorneys, who was supposedly present for the talks, says he "can't confirm or deny" that any discussions took place. (Lerma, who wasn't present for the discussions, says that he can't confirm the amount offered but that he has seen documents from the church specifying the conditions Wollersheim describes.) Although the details are very much in dispute, such a hush-hush deal wouldn't be unheard of in the annals of Scientology, the controversial, far-flung religious empire founded by science-fiction writer L. Ron Hubbard in 1954.

Over the years the church has quietly purchased the silence of several of its most ardent critics, for sums reportedly stretching into six and seven figures. Several years ago Boston attorney Michael Flynn, who'd represented a number of dissidents in their cases against Scientology, entered into a "global settlement" with the church on behalf of himself and his clients; Flynn no longer litigates against the church or publicly comments on its operations. Other opponents, such as the Cult Awareness Network, have been driven into bankruptcy by lawsuits filed by the church or its members and have seen their assets acquired by Scientology supporters.

Wollersheim's legal battles with Scientology began in 1980, shortly after he left the church. He filed suit in California, claiming the group used coercive methods to keep him in the fold and harassed him after he left. During the years the case dragged through the courts, he says, Scientology's attorneys approached his side with various offers of settlement.

"The first offer they made me, back around 1983, was $500,000," he says. "All I had to do was admit that everything they did to me was religious. My attorney said, 'We will never call what you did to another human being legitimate religious practices.'"

In 1986 a jury awarded Wollersheim $30 million in damages against Scientology's California organization. The award was reduced to $2.5 million on appeal; he has yet to collect. Church entities have since sued him three times. All three cases were dismissed, and in one the judge awarded Wollersheim's side nearly half a million dollars in attorney's fees and costs. (That award was abruptly paid a few months ago, much to Wollersheim's surprise.)

The FACTNet case dates back to the summer of 1995, when church officials obtained federal search warrants and seized computers and documents from the homes of boardmembers Wollersheim, Lerma and Penney, charging that the three were engaged in the unauthorized distribution of copyrighted materials and had violated the church's "trade secrets" by posting Hubbard's closely guarded "Advanced Technology" writings on the Internet. In the past two years the case has piled up thousands of pages of motions and pleadings and dozens of boxes of exhibits while exhausting $2 million in insurance coverage that FACTNet had obtained shortly before the raids.

In a separate action in Virginia, Lerma was found liable for copyright violation for posting the materials and fined a mere $2,500. Attorneys for Religious Technology Corporation, which holds the copyrights to Hubbard's unpublished work, claim that decision (and an injunction against further postings) offers the relief they sought in the FACTNet suit; they recently withdrew their copyright claims in the case. But the suit continues over FACTNet's alleged infringement of previously published Scientology materials; Wollersheim argues that RTC dropped its copyright and trade-secret claims only because his side plans to challenge the legitimacy of Hubbard's secret writings, which some critics believe to be partially authored by others.

Wollersheim suggests that the so-called settlement offer was prompted by the effort his attorneys made last spring to reopen the probate case of L. Ron Hubbard, who died in seclusion in 1986, in order to examine the process by which various copyrights were transferred to RTC and other church entities. Although that effort was rebuffed by a California judge, Wollersheim vows to pursue the matter, as well as counterclaims against the church for the 1995 raid on his home and the damage it inflicted on his organization. He must have struck a nerve somewhere, he contends; by virtue of his judgment against the church in California, he says, "I'm the only one, other than the Hubbard family members, that can challenge the probate."

The FACTNet founder says he went into settlement talks with Rinder and others in a sincere effort to settle all his past and pending litigation against the church, but the conditions sought by the church were unacceptable. By his account, they included not only a "gag order" that would have prevented him from commenting on Scientology in the future but a requirement that he make "false and self-incriminating public statements" repudiating his criticism of the group. Worst of all, he says, church officials wanted FACTNet closed and its archives destroyed; having compiled what he describes as a "massive library" of inside information about the church, including accounts of alleged mistreatment by ex-members and reports of suspicious deaths, Wollersheim refused.

"To allow a free-speech organization to be bought by an organization trying to censor information and destroy a library," he says, "would be cognitive dissonance to the level of insanity."

Scientology critics on the Internet have expressed mixed reactions to Wollersheim's claim of having turned down $12 million. Some have praised him for taking a stand, but others have expressed doubts about his version of events and characterized his account as a fundraising ploy. Wollersheim directs skeptics to FACTNet's Web page (, where he's launched a "Free Speech Revolt" campaign urging people to boycott movies featuring "celebrity promoters of Scientology" such as Tom Cruise and John Travolta and to donate to a variety of anti-Scientology causes.

"This is not a situation where we want people to come and bring us money in any exclusive way," he says. "I would rather have them boycotting these movies, picketing their organizations and downloading our page and putting it up in a safe spot. We're laying the foundation for somebody else in the future."

In the absence of a settlement, the intensely acrimonious FACTNet case will continue to slouch toward trial, testing the limits of endurance of all involved. In court filings, Wollersheim attorney Graham Berry has complained about private investigators hired by the other side harassing members of his legal team and support staff. While denying any misconduct, RTC's attorneys have sought contempt rulings against Berry and claimed that FACTNet has abused the discovery process.

U.S. District Court Judge John Kane has found the sniping so irksome that he gave both sides a thorough tongue-lashing in a hearing last spring, telling them to "stop screwing around and act like lawyers." He threatened to take the accusations of misconduct to a federal prosecutor for presentation to a grand jury--and if the charges proved unfounded, to impose sanctions on the accusers.

"If you want to fight every step of the way, you'll pay for it," Kane warned. "You'll pay every pound of it, every penny's worth...There is no reason why people should approach litigation in this fashion. I'm not stating who's at fault. I've heard enough of this case at this point to say a plague on all your houses."

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