Posted on by Marc O. DeGirolami

EDNY: Contraception Mandate Violates RFRA

The United States District Court for the Eastern District of New York has issued a decision holding that the HHS contraception mandate violates the Religious Freedom Restoration Act (see here for a previous post on this case). Certain plaintiffs in the case are Catholic non-profit organizations that qualify for the “accommodation” offered by government. Other plaintiffs are Diocesan–the lead plaintiff is the Roman Catholic Archdiocese of New York–and qualify for the exemption. All plaintiffs are self-insured. The exempted plaintiffs’ claims were dismissed.

The remainder of this post will focus on the non-exempted but “accommodated” plaintiffs (for more on exactly who falls into this group, see Points 2B and 3 in this post), whose claims succeeded. The government’s “accommodation” is to allow non-exempted non-profits to fill out a self-certification indicating that they have religious objections to providing the objected-to products to their employees. In the case of self-insured, non-exempted non-profits (such as these plaintiffs) the government demands that such organizations notify a third-party administrator (TPA) of their self-certification, at which time this TPA assumes the obligation of providing the objected-to products to the employees (there is an important wrinkle here that I will note at the end of this post).

In granting the plaintiffs’ motion for summary judgment, the court first held that plaintiffs satisfied the substantial burden prong of the RFRA test. In so holding, it applied a “substantial pressure” standard to evaluate whether plaintiffs suffered a “substantial burden”: “Rather than whether the pressure is indirect or direct, it seems that the more important distinction for the case at bar is between government action that pressures an individual to act inconsistently with his beliefs, and government action that discourages a plaintiff from acting consistently with those beliefs.” The court held that the self-certification requirement imposed by the “accommodation” on non-exempted non-profits was a substantial burden and rejected the government’s proposed test that a court should evaluate whether the burden was “de minimis” or should evaluate whether the self-certification is “too attenuated” to constitute a substantial burden.

The court also found that the government had not provided a compelling interest in mandating contraception coverage in the fashion it has selected. The government offered “the promotion of public health, and ensuring that women have equal access to health-care services” as its compelling interests. Though the court accepted these interests as important in the abstract, it rejected the government’s claim that granting exemptions to these plaintiffs would undermine the government’s ability to administer its regulation so as to achieve its aims uniformly.

Critically, it distinguished United States v. Lee–a case rejecting an Amish plaintiff’s request for exemption from paying taxes into Social Security–on the ground that the whole contraceptive mandate system would not collapse if exemptions were granted in these cases and the government’s application of the mandate is not uniform. Lee is a case on which proponents of the mandate have been placing great emphasis, but the death spiral dynamics at issue in Lee do not seem present here, in large part because of the government’s own exemptions. Here is the key language from the decision:

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Posted on by Marc O. DeGirolami

Does RFRA’s Least Restrictive Means Test Violate the Constitution?

Those pressing the claim that an exemption in the contraception mandate cases before the Supreme Court would violate the Establishment Clause face a few challenges–doctrinal, textual, and historical. The one that interests me in this post is that the test they favor is in considerable tension with the RFRA framework. Under the interpretation of the Establishment Clause being pressed, it seems to me that the least restrictive means test that represents the third prong of the strict scrutiny standard in RFRA and RLUIPA is constitutionally suspect.

Recall the theory: religious accommodations are unconstitutional if they shift “significant burdens” onto a “focused and identifiable class of third parties.” For the moment, leave aside the “focused and identifiable” component. We know that under RFRA, the religious claimant must allege a substantial burden on religious exercise. If it does so, the burden shifts to the government to show that the substantial burden on religious exercise it has imposed is justified by a compelling governmental interest. But the government must also show that it is using the least restrictive means to achieve its interest. So, for example, the government cannot simply say that the contraception mandate is supported by its compelling interest in good health care, full stop. Its statement of its interest is invariably focused and refined by the need to demonstrate that it has used the narrowest means available–that means which least burdens the religious claimant–to achieve its interest. And the least restrictive means component of the RFRA test is, in fact, one of the points on which it has been argued that the government’s case for the contraception mandate is weakest.

Suppose one accepts the claim that any “significant” burden resulting from cost shifting onto third parties triggers an Establishment Clause claim (again, for the moment, set to the side the question of what constitutes a “focused and identifiable” group). It seems to me that one would also be saying that the least restrictive means test is at least presumptively constitutionally suspect. The more narrowly tailored a means is so as to avoid burdens on religious objectors, the more probable it becomes that the means selected will burden third party interests. There may perhaps be rare occasions when an accommodation imposes no costs at all on third parties. But very often this will look like a sliding scale: as the imposition on the religiously burdened party decreases, the imposition on third parties increases. And by the time that one gets to the least restrictive means, the sliding scale is very much calibrated against the third party interests. By that point, it will have become highly probable–in some cases verging on certain–that the means chosen will impose “significant” burdens on third parties.

Take these cases.

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Posted on by Marc O. DeGirolami

On the Claim That Exemptions From the Contraception Mandate Violate the Establishment Clause

I am glad to see that in the wake of the cert. grants for Hobby Lobby and Conestoga Wood, there has been a frothing up of interest in the issues presented by these cases, issues that we here have been discussing for quite some time at CLR Forum. In this post, I want to address one such new claim.

Professors Nelson Tebbe and Micah Schwartzman (T&S) recently argued that an exemption from the contraception mandate under RFRA for employers like Hobby Lobby or Conestoga Wood would violate the Establishment Clause. They elaborate on their claim here and here. Many of the arguments are derived from this paper by Professor Fred Gedicks and Rebecca Van Tassell. The core of the argument is that granting an exemption from the mandate would privilege or favor religion inasmuch as it would shift the burden of purchasing contraception to third parties–i.e., the employees of the exempted corporations. The key to understanding the argument is their reliance on a Burger Court case, Estate of Thornton v. Caldor, which involved an exemption for employees from working on their Sabbath day. A Presbyterian who wished not to work on Sunday sued Caldor after the company dismissed him from a management position because he would not work Sunday. Because the law took absolutely no account of the secular interests of third parties (the employers), the law was found to violate the Establishment Clause. The “unyielding weighting in favor of Sabbath observers” resulted in a major burden on employers. T&S rely especially on this quote of Judge Learned Hand cited in Thornton: “The First Amendment … gives no one the right to insist that, in pursuit of their own interests, others must conform their conduct to his own religious necessities.” T&S (as well as Gedicks and Van Tassell) note that the principle of Thornton was restated in dicta in a more recent case, Cutter v. Wilkinson, which involved the application of RLUIPA. Justice Ginsburg, in dicta, said that in applying RLUIPA, “courts must take adequate account of the burdens a requested accommodation may impose on nonbeneficiaries.”

I think the argument is interesting, but mistaken. In truth, I have never understood Thornton very well at all and find it to be a difficult case. So I’ll start with a few basic points about exemptions and RFRA.

First, any exemption in this context will be directed toward benefiting some religious practice, and by being so directed, it will necessarily not benefit all others–i.e., “third parties.” If all choices to protect a specific form of religious exercise violate the Establishment Clause, then all exemptions for religion are Establishment Clause violations. The only thing that would be left for legislators is a law like RFRA, which accommodates religious exercise generally. Could it really be the case that the only thing the Establishment Clause permits is all or nothing? I don’t think so, and the Court has never said so. Professor Schwartzman, in other contexts, has questioned whether religion is a special category at all. If that argument were accepted and given constitutional force, then even laws like RFRA would be unconstitutional, because if the choice to protect religious exercise over non-religious ethical belief advances religion, then both specific and general accommodations are unconstitutional. The Court has not adopted that view. As Corporation of the Presiding Bishop of Church of Jesus Christ of Latter Day Saints v. Amos (1987) put it, “This Court has long recognized that the government may (and sometimes must) accommodate religious practices, and that it may do so without violating the Establishment Clause.”

Second, all exemptions burden third parties in one way or another. An exemption from laws proscribing peyote smoking imposes social costs of various kinds on third parties. An exemption from compulsory school attendance laws does so as well. An exemption for prisoners from wearing prison uniforms will burden prison officials and guards, and ultimately, everyone who is invested in a uniform system of penal justice. Indeed, one could go much further: all rights have costs that fall on third parties (you pick the context–the speech clause, Miranda rights, etc.). Thornton does not say that any time there is any shifting of burdens, the Establishment Clause is violated. Chief Justice Burger’s opinion was much, much narrower than that. It left open the possibility that a more carefully crafted Sabbath exemption law would be constitutional. That is more or less the upshot of Sherbert v. Verner (which was treated as good law by Thornton), where the Court held that a Seventh-day Adventist could not be denied unemployment compensation benefits because she refused to work on the Sabbath. In affirming that case, the Thornton Court is also affirming that it is perfectly constitutional for a state to exempt employees from Sabbath work on religious grounds, thereby imposing the costs of that exemption on third parties. All that Thornton is saying is that a law which imposes extremely severe burdens on secular interests through an “unyielding weighting of” religious interests over those other interests, and which takes no account of the secular interests at all, is constitutionally problematic. Consider an example. Under the Connecticut law at issue in Thornton, a school that is open only 5 days a week would have to provide Sabbath day exemptions to any teacher that asked for it. The burden on the school might be so severe as to impede its ability to function–compelling it even to close. The Thornton Court said that it had to “take pains not to compel people to act in the name of any religion.” (emphasis mine). It’s that kind of extreme burden on secular interests that rendered this law unconstitutional. Another obvious example might be an accommodation that interfered with a third party’s religious freedom–compelling the third party to engage in religious activities. Yet while the Court has said that “[a]t some point, accommodation may devolve into ‘an unlawful fostering of religion,'” Amos, only an extreme and absolute imposition on third party interests would justify that conclusion.

Third, both Thornton and a case like Texas Monthly v. Bullock seem to suggest that the burden imposed on secular interests must be state-imposed. Here the question is somewhat complicated inasmuch as the “burden” on employees is said to result from the combination of private claims and state power. Nevertheless, what these cases concerned is the alleviation of burdens on religious or secular beliefs imposed by the state.

Fourth, T&S wonder why nobody has made much of the Establishment Clause claim. But I think there is a good reason. RFRA incorporates certain limits to accommodation. That is, it would be a very rare RFRA (or RLUIPA) accommodation indeed which was constitutionally problematic under Thornton, because all RFRA (and RLUIPA) accommodations need to satisfy the substantial burden, compelling interest, least-restrictive-means threshold. The law at issue in Thornton, according to the Court required an accommodation “no matter what burden or inconvenience this imposes” on third parties. But the standard for RFRA accommodations is not, “you must grant the accommodation no matter what burden or inconvenience this imposes.” Accommodations must pass the government compelling interest threshold. If they do, they seem very much not to be violations of the Establishment Clause rule laid out in Thornton. In fact, many of the arguments about third party harms that T&S make have already been briefed by mandate advocates as part of the RFRA calculus. So they haven’t been ignored. They just haven’t been analyzed under the Thornton Establishment Clause framework, because Congress already saw to that in the statutes.

But let’s consider the Establishment Clause precedents on their own.

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Posted on by Mark Movsesian

Ron Colombo on Yesterday’s Cert Grants

At Constitution Daily, Hofstra’s Ron Colombo, a past guest here at CLR Forum, has a helpful essay on the contraception mandate cases on which the Court granted cert yesterday. Ron argues that for-profit corporations like Hobby Lobby, the respondent in one of the cases, have standing to raise a free exercise claim:

Hobby Lobby … is owned and operated by a family deeply devoted to its Christian faith.  The company’s statement of purpose commits it to “[h]onoring the Lord in all we do by operating the company in a manner consistent with Biblical principles.”  Unlike so many companies today that put profits over people, Hobby Lobby pledges to “[s]erving [its] employees and their families by establishing a work environment and company policies that build character, strengthen individuals, and nurture families.” . . .

So the question becomes:  does the First Amendment provide the protections necessary for businesses such as Hobby Lobby to exist?  Or, to frame things differently:  are individuals free under the U.S. Constitution to follow the dictates of their consciences into the private sector, and to start businesses with practices that are religiously informed?  Businesses around which workers, customers, and investors with shared religious values and beliefs can coalesce?

As should become readily apparent, the recognition of “corporate free exercise rights” ultimately redounds to the protection of individuals.  For it is through religiously expressive corporations that many people wish to live out their faiths.  Can it really be the case that the Constitution effectively consigns these individuals to careers and options only in the world of non-profits?  Is the most significant modern means of harnessing private initiative, the business corporation, somehow carved out from the First Amendment’s religious liberty protections?

You can read Ron’s essay here.

Posted on by Marc O. DeGirolami

Supreme Court Agrees to Hear For-Profit Contraception Mandate Cases

The Supreme Court has granted certiorari on two cases involving for-profit corporations which brought claims pursuant to the Constitution and the Religious Freedom Restoration Act against the federal government’s contraception mandate (which is part of the Patient Protection Affordable Care Act). The two cases that the Court agreed to hear were the Hobby Lobby case out of the Tenth Circuit and the Conestoga Wood case out of the Third Circuit.

Note that these cases solely involve the issue of for-profit corporations. They do not concern the question of the “accommodation” granted to certain religious non-profit corporations which the government has decided are not exempt from the mandate. As this breakdown indicates, the Tenth Circuit found en banc that the corporation had free exercise rights which had been violated (it did not decide the issue of the rights of the individual owners), while the Third Circuit panel rejected all claims. One last note of interest (for now): neither of these corporations is owned by Catholics. Hobby Lobby’s ownership is Evangelical, while Conestoga Wood Specialties’ ownership is Mennonite.

Posted on by Marc O. DeGirolami · 2 Comments

Seventh Circuit Enjoins Enforcement of Contraception Mandate Against For-Profits

In an extensive decision, a divided panel of the U.S. Court of Appeals for the Seventh Circuit has enjoined the enforcement of the HHS contraception mandate against several for-profit corporations as well as the individual owners of those corporations. The majority held that “the corporate plaintiffs are ‘persons’ under RFRA and may invoke the statute’s protection; the contraception mandate substantially burdens the religious-exercise rights of all the plaintiffs; and the government has not carried its burden under strict scrutiny.” Since RFRA does not itself define “person,” the majority reached the conclusion that corporations are “persons” under RFRA by consulting the Dictionary Act and finding that nothing in the text of RFRA indicates that the Dictionary Act definition would be a “poor fit” with the statutory scheme (this is the standard announced in a 1993 Supreme Court case).  In both O Centro and Lukumi Babalu, the Supreme Court enforced the free exercise rights of corporations, so the relevant context did not indicate that the Dictionary Act definition of “person” was inapposite here. The court proceeded through a very thorough analysis of the strict scrutiny inquiry. Judge Rovner dissented.

I’ll use the occasion to update my running tally of where we are now in the circuit courts of appeals with respect to this class of litigation:

  • Circuits that have rejected claims in which for-profit corporations are plaintiffs as to the corporations and the individual owners: Third Circuit, Sixth Circuit.
  • Circuits that have accepted claims in which for-profit corporations are plaintiffs as to the corporations and the individual owners: Seventh Circuit.
  • Circuits that have accepted claims in which for-profit corporations are plaintiffs as to the corporations but not the individual owners: Tenth Circuit.
  • Circuits that have accepted claims in which for-profit corporations are plaintiffs as to the individual owners but not the corporations: D.C. Circuit.
Posted on by Marc O. DeGirolami

D.C. Circuit Holds that Owners of For-Profit Corporations Are Injured by Contraception Mandate

This news is a little late in coming, but readers here should know that the United States Court of Appeals for the D.C. Circuit, in a 2-1 panel decision (as to this specific issue), has reversed the district court’s denial of a preliminary injunction barring enforcement of the federal government’s contraception mandate against the owners of a for-profit business. Though the panel was unanimous as to the issue of the individual plaintiffs’ standing to bring a claim under RFRA, only two judges (Judge Brown and Judge Randolph) held that the plaintiffs had satisfied the standard to obtain a preliminary injunction against the government. The court also held, 2-1, that corporations themselves do not have standing to exercise religion and so it dismissed those RFRA claims.

I recommend this thorough analysis and critique of the opinion by Kevin Walsh. For the record, and by my count (though I may have erred in my counting, and please write me if so), we now have the following breakdown among the federal circuit court of appeals:

  • Circuits that have rejected claims in which for-profits are plaintiffs on behalf of the corporation and the individual owners: Third Circuit, Sixth Circuit.
  • Circuits that have accepted claims in which for-profits are plaintiffs on behalf of the corporation but not the individual owners: Tenth Circuit.
  • Circuits that have accepted claims in which for-profits are plaintiffs on behalf of the individual owners but not the corporation: D.C. Circuit.
Posted on by Marc O. DeGirolami

Hobby Lobby Supports Cert. Grant

Via the very good Josh Blackman, I learn that Hobby Lobby, the corporation that successfully challenged the contraception mandate before the Tenth Circuit, is supporting the government’s petition for certiorari. As Professor Blackman says, “You don’t see this too often.” The formidable Paul Clement to argue for Hobby Lobby.

Posted on by Marc O. DeGirolami

Sixth Circuit Holds that “Secular, Profit-Seeking” Corporations are Not “Persons” under RFRA

In a terse and unsatisfying opinion, the United States Court of Appeals for the Sixth Circuit has held that “secular, profit-seeking” corporations have no standing to sue under the Religious Freedom Restoration Act. The plaintiffs, Roman Catholic owners of a closely held corporation that manufactures automotive and medical products, alleged that the HHS Contraception Mandate violated their religious free exercise under RFRA. After holding that the individual plaintiffs did not have standing, the court said this about the corporation’s standing:

Looking to RFRA’s relevant context, we find strong indications that Congress did not intend to include corporations primarily organized for secular, profit-seeking purposes as “persons” under RFRA. Again, Congress’s express purpose in enacting RFRA was to restore Free Exercise Clause claims of the sort articulated in Sherbert and Yoder, claims which were fundamentally personal . . . .

While the Supreme Court has recognized the rights of sole proprietors under the Free Exercise Clause during this period, it has never recognized similar rights on behalf of corporations pursuing secular ends for profit . . . .

Moreover, the Supreme Court has observed that the purpose of the Free Exercise Clause “is to secure religious liberty in the individual by prohibiting any invasions thereof by civil authority.” Sch. Dist. of Abington Twp., Pa. v. Schempp, 374 U.S. 203, 223 (1963) (emphasis added); see also Conestoga, 2013 WL 3845365, at *5 (“[W]e simply cannot understand how a for-profit, secular corporation–apart from its owners–can exercise religion.”).

Where to begin? The court recognizes that its emphasis on religious freedom that is “personal” or “individual” has, in fact, been totally irrelevant in many, many cases involving the Free Exercise Clause and RFRA in which the plaintiff corporations have prevailed. So why emphasize it? The distinction can do nothing by itself to justify the outcome, and the court seems to say as much.

“Personal” vs. “Group or Corporate” is doing no work here. Instead, there are two phrases that ground the decision: “secular” and “profit-seeking.” And, as I have said before, if courts are to deny religious freedom claims by corporations on these grounds–on the ground of a distinction between the secular and the religious, on the one hand, or of a distinction between profit-seeking and non-profit-seeking, on the other–then they will need to develop a theory of what “secular” means, and what “religious” means, and why the distinction matters in law. Or, they will need to make arguments about what precisely the difference is between “for profit” and “nonprofit” in this context and why it matters.

I should say straightaway that there may well be a discussion to be had, and arguments to be made, about the legal significance of the distinction between the “secular” and the “religious.” I recommend especially much of Steven D. Smith’s recent work on this issue, including this article. But there is not a single word in this decision about that distinction. Likewise, there is nothing about the conceptual distinction between for-profit and nonprofit in this specific context and its import (there is, at the end of the decision, a dubious interpretation of RFRA’s legislative history, but there is nothing of the sort of conceptual work that would be necessary to sustain a holding of this kind).

The Sixth Circuit joins the Third Circuit in reaching this result. Both courts are at odds with the Tenth Circuit. The case is Autocam Corp. v. Sebelius.

Posted on by Marc O. DeGirolami

Third Circuit Denies Rehearing En Banc in Corporate Free Exercise Case

Yesterday, the U.S. Court of Appeals for the Third Circuit denied rehearing en banc in Conestoga Wood Specialties Corp. v. Secretary of the U.S. Department of Health and Human Services. The vote was 7 to 5.

In light of the many problems with Judge Cowen’s opinion for the panel majority as well as the circuit split that is developing over the issue of corporate free exercise of religion (for constitutional and statutory purposes) and the dichotomous confusions that the issue is generating (religious vs. secular, for-profit vs. non-profit), it would not be surprising if one or more of these cases found their way to the Supreme Court relatively soon. On the other hand, these kinds of predictions have an uncanny way of being wrong.