[Episcopal Church in South Carolina — press release] The lawsuit filed by a breakaway group against the Episcopal Church and its local diocese in eastern South Carolina will be heard in state court, not federal court, U.S. District Court Judge C. Weston Houck ruled June 10.

The Episcopal Church in South Carolina had sought to have the case heard in federal court, citing First Amendment issues raised by the case. The lawsuit will now return to South Carolina Circuit Court and Judge Diane S. Goodstein in Dorchester County, said Thomas S. Tisdale, Jr., chancellor of The Episcopal Church in South Carolina. Judge Houck’s order cannot be appealed.

“We are obviously disappointed with the result, but we are confident in our legal position going forward,” Mr. Tisdale said.

The lawsuit was filed in January by a group of former church leaders and some 34 parishes in eastern South Carolina who say they have “disassociated” from The Episcopal Church, seeking control of the name, seal and properties of the diocese. The group continues to call itself “The Protestant Episcopal Church in the Diocese of South Carolina,” and recognizes Mark Lawrence as its bishop.

Defendants in the suit are the Episcopal Church and its local diocese, which is currently using the name “The Episcopal Church in South Carolina.” Its bishop is the Right Reverend Charles G. vonRosenberg, who was elected by local Episcopalians in January after Presiding Bishop Katharine Jefferts Schori accepted Mark Lawrence’s renunciation of his orders as a bishop in The Episcopal Church.

“We believe that the critical First Amendment issues at the center of this case would have been most appropriately resolved in federal court, but we respect the court’s decision to return this case to state court,” said Matthew D. McGill of the Washington, D.C. office of Gibson, Dunn & Crutcher, who spoke for TECSC in last week’s hearing before Judge Houck.

“The federal court recognized that The Episcopal Church is a hierarchical church and we hope that the state court will recognize the First Amendment right of all such churches to organize and administer their affairs without government interference,” Mr. McGill said. “Our federal litigation against Bishop Lawrence continues and we hope soon will confirm that he is no longer the Bishop of the Diocese because he left the church of which the Diocese is a part.”

A separate federal lawsuit is still before Judge Houck. Filed in March by Bishop Charles G. vonRosenberg against Mark Lawrence, it asks the court to find that only Bishop vonRosenberg, as The Episcopal Church’s recognized bishop, should control the name and marks of the diocese.

The federal suit, vonRosenberg v. Lawrence, cites federal trademark law and a 1976 U.S. Supreme Court decision, Serbian Eastern Orthodox Diocese v. Milivojevich. Under that decision, civil courts may not interfere in decisions made by hierarchical churches, such as The Episcopal Church, about decisions as to who is the true bishop of a diocese.