Susan Thompson-Gaines of Arlington, Va., left, with her husband David Gaines, stand outside the Supreme Court holding signs opposing businesses challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks

Susan Thompson-Gaines of Arlington, Va., left, with her husband David Gaines, stand outside the Supreme Court holding signs opposing businesses challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks


This image is available for Web and print publication. For questions, contact Sally Morrow.

WASHINGTON (RNS) When two corporations — one owned by evangelicals and one owned by Mennonites — filed suit over the Affordable Care Act, they described their complaint in stark and fairly simple terms: The government is forcing them to either break the law or betray their faith.

But at the Supreme Court on Tuesday (March 25), nothing was so clear as the justices explored the murky territory where an employer’s religious rights collide with the interests of its employees or the government.

On the one side is the Hobby Lobby arts-and-crafts chain and Conestoga Wood Specialties cabinetry company, both owned by devout families. On the other is the federal government, which argues that the landmark 2010 health care law gives women a statutory right to choose among 20 methods of birth control.

The court, judging from the justices’ questions, is clearly divided on this potential earthquake of a religious rights case. It could be yet another instance where Justice Anthony Kennedy provides the swing vote — in this case whether a corporation has religious rights, and whether those rights in this case have been trampled.

Barbara Green, a member of the Hobby Lobby family, speaks to the press outside the Supreme Court after the court heard cases of two businesses, including Hobby Lobby, challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks

Barbara Green, a member of the Hobby Lobby family, speaks to the press outside the Supreme Court after the court heard cases of two businesses, including Hobby Lobby, challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks


This image is available for Web and print publication. For questions, contact Sally Morrow.

Hobby Lobby, owned by the Green family, and Conestoga, owned by the Hahns, object to paying for the full range of birth control drugs and devices as required by the Affordable Care Act. To them, a handful of the methods they must cover could cause abortion. Including these methods in their companies’ insurance package is, in their eyes, sinful.

Justice Elena Kagan took up the government’s case from the bench, avowing that the families’ religious convictions were beyond doubt. But she suggested that exempting them from the law would open the door to exemptions for a slew of employers who didn’t want to cover a host of medical services — from vaccinations to blood transfusions — because they conflicted with their religious beliefs.

Kagan suggested that the corporate owners have a choice other than breaking the law and betraying their religious principles. It’s an option, she said, “that nobody talks about . . . Hobby Lobby could choose not to provide insurance.” Under the health care law, the companies would have to pay a tax instead, but it would be comparable to the costs of insurance, she said.

Carolyn Hahn, left, and her husband, Anthony Hahn, president and CEO of Conestoga Wood Specialties Corp., leave the Supreme Court on Tuesday (March 25) after oral arguments in a case in which Conestoga challenged the contraception mandate of the Affordable Care Act. RNS photo by Adelle M. Banks

Carolyn Hahn, left, and her husband, Anthony Hahn, president and CEO of Conestoga Wood Specialties Corp., leave the Supreme Court on Tuesday (March 25) after oral arguments in a case in which Conestoga challenged the contraception mandate of the Affordable Care Act. RNS photo by Adelle M. Banks


This image is available for Web and print publication. For questions, contact Sally Morrow.

 

Paul D. Clement, the lawyer for the companies, countered that such a tax would better be described as a penalty, and that the corporations would suffer for it, having to raise wages to compensate for their lack of a health care plan. “It certainly feels punitive,” he said.

Clement, a former U.S. solicitor general, leaned heavily on the language of the other law that’s central to this case: the 20-year-old Religious Freedom Restoration Act, which requires the government to meet the most stringent legal test before impinging on religious rights. The government must prove a compelling interest before it abridges religious rights, and then also show that it has chosen the least restrictive means possible to meet its goal.

One alternative is that a third party picks up the cost, Clement said. Why can’t the government, he asked, step in and pay for the methods of birth control to which these corporations object? That’s essentially what it does for employers with 50 or fewer employees. “They can do the same thing for objecting religious employers,” he said.

And don’t worry about company after company stepping up to claim exemptions the Green and Hahn families are entitled to, Clement said. With them, their religious sincerity is obvious. But an onslaught of corporations claiming exemptions under RFRA? “That’s not going to happen in the real world,” he said.

Rev. Frank Pavone of Priests for Life, left, leads a prayer beside Rev. Patrick Mahoney right, in front of the Supreme Court, as they support businesses challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks

Rev. Frank Pavone of Priests for Life, left, leads a prayer beside Rev. Patrick Mahoney right, in front of the Supreme Court, as they support businesses challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks


This image is available for Web and print publication. For questions, contact Sally Morrow.

But Kagan retorted that courts have long avoided getting into the business of judging religious sincerity.

Solicitor General Donald B. Verrilli, who argued the government’s case, tried to poke holes in Clement’s position by first questioning whether the companies have a right to sue under RFRA in the first place. He argued that a corporation does not have religious rights.

If the court decided that companies do have religious rights, it would be “such a vast expansion of what Congress thought it was doing” in passing RFRA in 1993.

But Chief Justice John Roberts suggested that though the companies themselves might not have a religious conviction, that doesn’t mean they don’t have the right to be protected from religious discrimination. He made a comparison:

“Every court of appeal to have looked at the situation (has) held that corporations can bring racial discrimination claims as corporations,” Roberts said. “Now does the government have a position on whether corporations have a race?”

“Yes,” Verrilli replied. “We think those are correct and that this situation is different.”

Margot Riphagen of New Orleans, dressed as a pack of birth control pills, demonstrated outside the Supreme Court, which heard cases of two businesses challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks

Margot Riphagen of New Orleans, dressed as a pack of birth control pills, demonstrated outside the Supreme Court, which heard cases of two businesses challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks


This image is available for Web and print publication. For questions, contact Sally Morrow.

Looming in the background of the case was the court’s 2010 Citizens United ruling, in which the court decided that corporations have free speech rights. Supporters of the families behind Hobby Lobby and Conestoga have argued that surely other First Amendment rights extend to corporations as well.

Justice Antonin Scalia brought up a potential weak point in the government’s case: that because it has granted exemptions to the Affordable Care Act, the administration cannot prove that the law is designed to advance a “compelling interest.” Businesses with 50 or fewer employees don’t have to comply, and neither do churches.

As for a compelling interest, “you can’t argue that here because the government has made a lot of exemptions,” Scalia said.

Verrilli said that’s a misconception. Yes, churches are exempt, but churches and other houses of worship have always enjoyed special treatment under the law.

Other religiously affiliated groups are mistakenly considered exempt, he said, when they have been accommodated: Their employees can still receive birth control.

Deodonne Bhattarai of Washington, D.C., who is 7 1/2 months pregnant, demonstrated in front of the Supreme Court, which heard cases of two businesses challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks

Deodonne Bhattarai of Washington, D.C., who is 7 1/2 months pregnant, demonstrated in front of the Supreme Court, which heard cases of two businesses challenging the contraception mandate of the Affordable Care Act on Tuesday (March 25). RNS photo by Adelle M. Banks


This image is available for Web and print publication. For questions, contact Sally Morrow.

As for employers with 50 or fewer employees, the Affordable Care Act exempts them now, Verrilli said. But that’s typical of important federal laws, such as the ACA and the Americans with Disabilities Act: It takes time before the law is applied to all.

“The right of the third-party employees are at center stage here,” Verrilli said, but they are not always treated that way. “They’re left on the sidelines.”

The court’s decision in the twin cases, Sebelius v. Hobby Lobby Stores Inc. and Conestoga Wood Specialties Corp. v. Sebelius, is expected by late June.

KRE/AMB END MARKOE

 

 

20 Comments

  1. Its kinda funny that for the most part Corporate America has been against Hobby Lobby. They find the shredding of the corporate veil distressing and potentially destructive to corporate existence.

    http://www.salon.com/2014/03/25/4_things_you_need_to_know_about_the_hobby_lobby_scotus_case/

    “.,..what a group of corporate and criminal law scholars had to say about the issue in a brief filed in opposition to Hobby Lobby:

    The essence of a corporation is its “separateness” from its shareholders. It is a distinct legal entity, with its own rights and obligations, different from the rights and obligations of its shareholders. This Court has repeatedly recognized this separateness.

    Shareholders rely on the corporation’s separate existence to shield them from personal liability. When they voluntarily choose to incorporate a business, shareholders cannot then decide to ignore, either directly or indirectly, the distinct legal existence of the corporation when it serves their personal interests.

    he separateness between shareholders and the corporation that they own (or, in this case, own and control) is essential to promote investment, innovation, job generation, and the orderly conduct of business. This Court should not adopt a standard that chips away at, creates idiosyncratic exceptions to, or calls into question this legal separateness.”

    In the same brief, these experts note how Hobby Lobby is effectively asking to have it both ways — protection from liability and an à la carte menu of individual rights:

    Hobby Lobby and Conestoga argue that they should be exempt from federal law because of the religious values of their controlling shareholders, while seeking to maintain the benefits of corporate separateness for all other purposes. These corporations have benefited from their separateness in countless ways and their shareholders have been insulated from actual and potential corporate liabilities since inception. Yet now they ask this Court to disregard that separateness in connection with a government regulation applicable solely to the corporate entity. Hobby Lobby and Conestoga want to argue, in effect, that the corporate veil is only a one-way street: its shareholders can get protection from tort or contract liability by standing behind the veil, but the corporation can ask a court to disregard the corporate veil on this occasion. Hobby Lobby and Conestoga cannot have it both ways.

    • You are right that these corporations want it both ways. The problem is that they will probably receive the specialized treatment they seek. This Court has not been shy about trampling on the rights of individuals, only to secure the rights of specific corporations. Indeed, there is really no need for Alito and Thomas to even bother showing up any longer. Their observations (not that anyone is actually certain whether Thomas has vocal cords) are uninspired, self-interested, and represent the very definition of bias. The only decision they ever make is how to restate the same perspective. Fortunately, for them, they need not fill their heads with facts or burden themselves with genuine thought. Such activities are far too time consuming. We would do just as well by having cardboard cutouts of their faces in the Court chambers, with a looped recording blaring the phrase, “we love corporations.” They want corporations to be seen as “individuals”, whenever it comes to the receipt of benefits. On the other hand, they are limited liability business structures when it comes to the imposition of burdens. They have been giving corporations the right to have it both ways for as long as they have been on the Court. I think my dog could make more reasoned decisions on issues than these two gigantic rubber stamps.

  1. […] The statement also said the two men discussed immigration reform and “the exercise of the rights to religious freedom, life and conscientious objection” among American Catholics — a veiled reference to Obama’s support of abortion rights and his strained relations with the American hierarchy over the administration’s contraception mandate under the Affordable Care Act, which went to the Supreme Court on Tuesday. […]

  2. […] The statement also said the two men discussed immigration reform and “the exercise of the rights to religious freedom, life and conscientious objection” among American Catholics — a veiled reference to Obama’s support of abortion rights and his strained relations with the American hierarchy over the administration’s contraception mandate under the Affordable Care Act, which went to the Supreme Court on Tuesday. […]

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