UPDATE Friday 5:46 pm: Facing a Monday deadline, two Oklahoma corporations run by devoutly religious families got a temporary court order Friday afternoon, barring the government from enforcing the mandate to provide birth control health insurance for their employees, under the new federal health care law.  A federal district judge issued a temporary stay until he can hold a hearing, set for July 19, on whether to impose a more lasting order.

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Ruling that some money-making corporations are “persons” that can have their own religious beliefs and exercise them, a divided en banc Tenth Circuit Court decided Thursday that two Oklahoma business firms may be able to escape having to provide full birth-control insurance for their employees.  This was the first ruling by a federal appeals court on the so-called “contraceptive mandate” in the new federal health care law.  The decision did not immediately block the mandate, but hinted strongly at that outcome.

With some sixty lawsuits unfolding nationwide that challenge the mandate — some by profit-making firms, others by non-profit colleges, schools, and other institutions — the issue is almost certain to reach the Supreme Court at its next Term.

It required six separate opinions by the Circuit Court, totaling 165 pages, to decide the case of Hobby Lobby Stores, Inc. v. Sebelius (Circuit docket 12-6294).  On the treatment of for-profit corporations as religious persons, the Court split five to three.  The decision found that corporations, if they are owned by religiously devout individuals who control the company’s affairs, are protected by the federal Religious Freedom Restoration Act — a 1993 law.

While the ruling did not confer constitutional status as religious persons on profit-making companies, it borrowed from First Amendment religious theory to help fill out the meaning of the twenty-year-old federal law.

The religious person conclusion was based on the majority’s view that corporations absorb, as their own, the religious views of their owners, and then conduct their businesses as a way to express those convictions.  The majority did not give a precise definition of a RFRA corporate person, but its description seemed to closely track the characteristics of the two firms involved in the case.  The dissenting judges complained that the majority had based its rulings upon supposition, not legal evidence.

The Circuit Court returned the case to a federal district judge in Oklahoma, to weigh whether to bar the government from enforcing the mandate against the two Christian-oriented firms.  To ensure that the judge acted quickly, the Circuit Court ordered its ruling into effect “forthwith” — that is, just as soon as it emerged.   Four of the eight judges would have approved a preliminary ban on enforcement against the two firms, but they did not have a majority since the fifth judge who supported them on the RFRA point wanted further review by the Oklahoma judge.

The case involves Hobby Lobby Stores, a nationwide chain of 500 arts-and-crafts retail outlets, and an affiliated firm, Mardel, Inc., which operates thirty-five stores dealing in Christian literature.  Both are profit-making corporations, owned by the Green family, who run their businesses according to strongly held religious convictions.

The new federal health care law requires companies with fifty employees or more with employee benefit plans to provide health insurance for twenty different forms of contraceptive or pregnancy screening, ranging from oral contraceptives to surgical sterilization.  The two Oklahoma corporations, and their family owners, object on religious grounds only to those mandated methods that would lead to the death of an embryo.  They believe that human life begins when sperm fertilizes an egg.

While the firms and the families do not object to their workers paying with their own money for any contraceptive method, they oppose having to provide insurance coverage through their health plan for those methods to which they object.

The en banc Circuit Court acted four days before Hobby Lobby and Mardel said they would be obliged to start providing the full range of mandated coverage, or else face federal fines — payable to the IRS — that could run to a total of at least $1.3 million a day, or almost $475 million a year.  If the firms now sought to drop their health insurance completely, the Circuit Court said, they would face penalties of $26 million per year.

Those financial prospects were part of the reasoning the majority used in concluding that, as religious persons under RFRA, the two corporations would suffer “irreparable harm.”  That is one of the factors in deciding whether to issue a preliminary injunction to block enforcement of the mandate at issue.  The Circuit Court split on some of the others, leading to the decision to return the case to district court to explore those further.

 

 

Posted in Cases in the Pipeline, Featured

Recommended Citation: Lyle Denniston, Contraceptive mandate ruling (UPDATED), SCOTUSblog (Jun. 27, 2013, 7:14 PM), http://www.scotusblog.com/2013/06/contraceptive-mandate-ruling/