Burwell v. Hobby Lobby Stores, Inc., 573 U.S. 682 (2014), is a landmark decision in United States corporate law by the United States Supreme Court allowing privately held for-profit corporations to be exempt from a regulation that its owners religiously object to, if there is a less restrictive means of furthering the law's interest, pursuant to the Religious Freedom Restoration Act of 1993. It is the first time that the Court has recognized a for-profit corporation's claim of religious belief, but it is limited to privately held corporations. The decision does not address whether such corporations are protected by the Free Exercise Clause of the First Amendment of the Constitution.
For such companies, the Court's majority directly struck down the contraceptive mandate, a regulation adopted by the United States Department of Health and Human Services (HHS) under the Affordable Care Act (ACA) requiring employers to cover certain contraceptives for their female employees, by a 5–4 vote.See:
The Court said that the mandate was not the least restrictive way to ensure access to contraceptive care, noting that a less restrictive alternative was being provided for religious non-profits, until the Court issued an injunction 3 days later, effectively ending said alternative, replacing it with a government-sponsored alternative for any female employees of privately held corporations that do not wish to provide birth control.See: The ruling is considered to be part of the political controversy regarding the Affordable Care Act in the United States.
Background Federal law Religious Freedom Restoration Act The United States Supreme Court ruled in Employment Division v. Smith (1990) that a person may not defy neutral laws of general applicability even as an expression of religious belief. "To permit this," wrote Justice Scalia, citing the 1878 Reynolds v. United States decision, "would make the professed doctrines of religious belief superior to the law of the land, and in effect to permit every citizen to become a law unto himself. " He wrote that generally applicable laws do not have to meet the standard of strict scrutiny, because such a requirement would create "a private right to ignore generally applicable laws". Strict scrutiny would require a law to be the least restrictive means of furthering a compelling government interest.
In 1993, the US Congress responded by passing the Religious Freedom Restoration Act (RFRA), requiring strict scrutiny when a neutral law of general applicability "substantially burden[s] a person's exercise of religion". The RFRA was amended in 2000 by the Religious Land Use and Institutionalized Persons Act (RLUIPA) to redefine exercise of religion as any exercise of religion, "whether or not compelled by, or central to, a system of religious belief", which is to be "construed in favor of a broad protection of religious exercise, to the maximum extent permitted by the terms of this chapter and the Constitution". The Supreme Court upheld the constitutionality of the RFRA as applied to federal statutes in Gonzales v. O Centro Espirita in 2006.
Affordable Care Act Of those Americans who have health insurance, most are covered by employer-sponsored health insurance. In 2010, Congress passed the Affordable Care Act (ACA), which relies on the Health Resources and Services Administration (HRSA), part of the Department of Health and Human Services (HHS), to specify what kinds of preventive care for women should be covered in certain employer-based health plans. HHS exempted religious employers (churches and their integrated auxiliaries, associations of churches, and any religious order), non-profit organizations that object to any required contraception, employers providing grandfathered plans (that have not had specific changes before March 23, 2010), and employers with fewer than 50 employees. The HRSA decided that all twenty contraceptives approved by the U.S. Food and Drug Administration (FDA) should be covered. Companies that refuse are fined $100 per individual per day, or they can replace their health coverage with higher wages and a calibrated tax.
Hobby Lobby Stores and Conestoga Wood Specialties Hobby Lobby is an arts and crafts company founded by billionaire David Green and owned by the Evangelical Christian Green family with about 21,000 employees. It provided health insurance covering the contraceptives Plan-B and Ella until it dropped its coverage in 2012, the year it filed its lawsuit. The Hobby Lobby case also involved Mardel Christian and Educational Supply, which is owned by Mart Green, one of David's sons.
Hobby Lobby's case was consolidated with another case by Conestoga Wood Specialties, a furniture company owned by the Mennonite Hahn family that has about 1,000 employees, represented by the Alliance Defending Freedom.
Specific contraceptives contested by plaintiffs The plaintiffs believed that life began at conception, and objected to their businesses providing health insurance coverage to their female employees of four FDA-approved contraceptives that the plaintiffs believed prevented implantation of a fertilized egg. The plaintiffs believed the following forms of birth control constituted an abortion: Emergency contraceptive pills levonorgestrel (sold under the brand name Plan B among others) ulipristal acetate (sold under the brand name Ella among others) Intrauterine devices (IUDs) copper IUDs (sold under the brand name ParaGard among others) Hormonal IUDs (sold under the brand names Mirena and Skyla among others)
Lower court history In September 2012, Hobby Lobby filed a lawsuit in the United States District Court for the Western District of Oklahoma against enforcement of the contraception rule based on the RFRA and the Free Exercise Clause of the First Amendment. On November 19, 2012, U.S. District Judge Joe L. Heaton denied Hobby Lobby's request for a preliminary injunction. On December 26, 2012, Justice Sonia Sotomayor issued an in-chambers opinion denying an injunction pending appeal. In March 2013, the United States Court of Appeals for the Tenth Circuit granted a hearing of the case. In June, the appeals court ruled that Hobby Lobby Stores, Inc. is a person who has religious freedom. Circuit Judge Timothy Tymkovich wrote for the five-judge en banc majority, over a three-judge dissent.Recent Cases: Tenth Circuit Holds For-Profit Corporate Plaintiffs Likely to Succeed on the Merits of Substantial Burden on Religious Claim, 127 Harv. L. Rev. 1025 (2014). Neil Gorsuch voted with the majority and also wrote an opinion on the case. The court ordered the government to stop enforcement of the contraception rule on Hobby Lobby and sent the case back to the district court, which granted preliminary injunction in July. In September, the government appealed to the U.S. Supreme Court.
Two other federal appeals courts ruled against the contraception coverage rule, while another two upheld it.
The case was previously titled Sebelius v. Hobby Lobby. Sylvia Burwell was automatically substituted as petitioner when she was approved by the United States Senate as the Secretary of Health and Human Services after being nominated by President Barack Obama to replace Kathleen Sebelius following Sebelius' resignation on April 10, 2014.
U.S. Supreme Court consideration
Acceptance and briefs On November 26, the Supreme Court accepted and consolidated the case with Conestoga Wood Specialties v. Sebelius. Two dozen amicus briefs support the government, and five dozen support the companies. American Freedom Law Center's brief argues that birth control harms women because men will only want them "for the satisfaction of [their] own desires." Another brief argues that the contraception rule leads to "the maximization of sexual activity". Two of the briefs oppose each other on the constitutionality of the RFRA. Two briefs that do not formally take sides oppose each other on whether the right to religion applies to corporations. One of those briefs argues that if shareholders are separated by the corporate veil from corporate liabilities, then their religious values are also separate from the corporation. It mentions the ruling in Domino's Pizza, Inc. v. McDonald made against the African American owner of JWM Investments whose contracts were breached due to racial discrimination. The brief argues that if JWM Investments could not suffer discrimination through its owner, then Hobby Lobby could not suffer religious burden through its owner. Two briefs were filed by LGBT groups concerned that future anti-discrimination laws would be pre-emptively harmed if employers could claim to be religiously exempt.
Argument and deliberation Oral arguments were held on March 25, 2014, for 30 minutes more than the usual one hour. The three women in the court focused their questioning on Hobby Lobby's lawyer, Paul Clement, while the men focused on the administration's lawyer, Solicitor General Donald B. Verrilli Jr. Justice Sotomayor quoted the ruling from United States v. Lee (1982) saying that an employer can't deprive employees of a statutory right because of religious beliefs. Clement replied that Lee does not apply because it was a challenge against a tax rather than against a significant burden. Sotomayor said that instead of paying the burden of the penalty, Hobby Lobby could replace its health care with the equivalent expense of higher wages and a calibrated tax, which the government would use to pay for the employees' health care. Near the end of Clement's argument, Justice Kennedy expressed concern for the rights of the employees who may not agree with the religious beliefs of their employers. When Verrilli argued that the ruling in Cutter v. Wilkinson requires the court to weigh the impact on third parties in every RFRA case, Justice Scalia said that the RFRA does not require the court to balance the interest of the religious objector to the interest of other individuals. Verilli returned to Lee, saying that granting an exemption to an employer should not impose the employer's religious faith on the employees.
Opinion of the Court
Majority opinion
On June 30, 2014, Associate Justice Samuel Alito delivered the judgment of the court. Four justices (Roberts, Scalia, Kennedy, and Thomas) joined him to strike down the HHS mandate, as applied to closely held corporations with religious objections, and to prevent the plaintiffs from being compelled to provide contraception under their healthcare plans. The ruling was based on statutory grounds, citing the RFRA, because the mandate was not the "least restrictive" method of implementing the government's interest. The ruling did not address Hobby Lobby's claims under the Free Exercise Clause of the First Amendment.