The National Catholic Review

Advocates for religious freedom won a major victory in the Supreme Court of the United States on June 30. Justice Samuel Alito’s opinion for the court in Burwell v. Hobby Lobby Stores holds that the Religious Freedom Restoration Act (RFRA) requires the federal government to accommodate the claims of the owners of for-profit, closely-held corporations who say that their religious beliefs forbid participating in or administering insurance plans that cover contraceptives, such as IUDs, that prevent implantation of the fertilized ovum.

Writing for himself, the Chief Justice, and Justices Scalia, Thomas and Kennedy, Justice Alito’s majority opinion resolves three important statutory issues under R.F.R.A.:

1.  RFRA protects religious believers who elect to organize their business activities in the corporate form.

Hobby Lobby holds that religious believers do not forfeit their federal statutory right under RFRA “to exercise their religion” when they organize and operate as “closely-held,” for-profit, business corporations. Expressly rejecting the government’s position that only private individuals and non-profit corporations can plausibly argue that they have a right “to exercise their religion,” the court holds that “[b]usiness practices that are compelled or limited by the tenets of a religious doctrine fall comfortably within” both the constitutional and statutory definitions of the phrase “exercise of religion.”

In the court’s view, “[a] corporation is simply a form of organization used by human beings to achieve desired ends,” including business, politics, education, religion or charity. Because corporations “cannot do anything at all” without the human beings who bring it to life, attempts to discuss the rights of business corporations “ ‘separate and apart from’ the human beings who own, run, and are employed by them” cannot be justified.

Justice Ruth Bader Ginsburg’s dissent on this point was joined only by Justice Sonya Sotomayor. They would hold as a matter of principle that forfeiture of one’s right “to religious exercise” is simply one of the costs of doing business in the corporate form. Why, they ask, should an “individual [who] separates herself from the entity [by incorporating] and [thereby] escapes personal liability for the entity’s obligations” ever be permitted to claim that her personal religious freedom is infringed by government regulations of corporate conduct (p. 19)?

Justices Ginsburg and Sotomayor also fear the practical effect of the court’s ruling. Quoting Forbes’ “America’s Largest Companies, 2013, they correctly observe that “ ‘closely-held’ is not synonymous with small,” and complain (also correctly) that the court’s holding exposes millions of workers to the risk that their corporate employers and co-workers will try to use the court’s holding in Hobby Lobby to negate their right to contraceptive coverage under the Affordable Care Act. Justice Alito dismisses that possibility as “unlikely.”

Because they would have ruled that Hobby Lobby’s and Conestoga’ s religious liberty claim failed on its merits, Justices Stephen Breyer and Elena Kagan refused to join this part (III-C-1) of the Ginsburg-Sotomayor dissent.

2.  RFRA ensures that believers who enter the commercial marketplace as buyers and sellers of goods and services “for profit” have exactly the same right under federal law to bring their beliefs and values to bear on their business practices as those who make money in the “marketplace of ideas.”

Though Hobby Lobby is a statutory case, RFRA is no ordinary statute. Congress adopted R.F.R.A. in 1993 and President Clinton signed it because there was a bipartisan consensus that religious freedom claims made by minority or unpopular religious groups are not taken seriously, either by the Supreme Court itself, or by the politicians and bureaucrats who decide the nature and scope of religious exemptions. State legislatures that have adopted state versions of RFRA have drawn the same conclusions.

The contraceptive mandate involved in Hobby Lobby was exactly the type of government policy that R.F.R.A. was designed to cover. After Congress refused to address the “religious exemption” issue in the Affordable Care Act, the task of deciding which groups would have to pay for contraceptives and which would be accommodated fell first to the Obama administration.

Because there is no political incentive for any administration to antagonize its base by accommodating unpopular, but sincerely held, conscientious objection claims, the administration understandably took the default, “liberal” position that “for profit” corporations could claim no right “to exercise religion.” The “war against women” rhetoric employed by the administration and other groups was used thereafter to demonize opposition.

Hobby Lobby is thus a ringing reaffirmation of the principle of equal protection of the laws. There are many “for profit” businesses, both large and small, whose owners explicitly bring their beliefs and values to bear as they shape the culture and social priorities of their businesses. Among them are the founders of Google and the Ochs-Sulzberger family that owns The New York Times.

Before Hobby Lobby it was assumed that The Times had a constitutional right to shape its “for profit” editorial policies in the “marketplace of ideas” in any manner that advances its mission and is otherwise consistent with existing law. After Hobby Lobby, vendors like the Green family, who sell art and craft supplies and Christian books, and the Hahn family, who sell custom wood cabinets, have the same rights as Google and the Ochs-Sulzbergers to bring their values to bear on their “for profit” business practices.

3.  RFRA requires that the courts and executive branch accommodate good-faith (but politically unpopular) religious beliefs and practices

The most important question left open by the Hobby Lobby decision is its practical dimension: When and how must the government accommodate good faith religious beliefs and practices that are “substantially burdened” by government programs and edicts? As might be expected, the majority limited its answer to the specific claims made by Hobby Lobby and Conestoga Wood Products, leaving the dissenters to speculate on the “parade of horribles” that would necessarily follow a decision in Hobby Lobby’s favor.

The dissenters’ answer was clear and unequivocal: religious beliefs that would limit access to abortion and contraception should never be accommodated by employers. Justices Ginsburg gave three reasons for her categorical “no.”

First, and most important for Justice Ginsburg, access to employer-provided contraceptives “without cost sharing” is one of the key means by which Congress and the Executive Branch sought to protect “the ability of women to participate equally in the economic and social life of the Nation.” When they arise in the workplace, conscientious objection claims should be viewed as direct attacks on the equality and reproductive health rights of working women. Accepting such views as the basis of legitimate religious exemption claims under RFRA will, in her opinion, encourage others to demand “so-called ‘conscience’” exemptions from laws that forbid discrimination on the basis of race, sex and sexual orientation.

Second, Justice Ginsburg and the dissenters view any accommodation of the “so-called ‘conscience’” rights at issue in Hobby Lobby as an unwarranted (and potentially unconstitutional) effort by religiously motivated business owners to “override significant interests of the [their] employees and covered dependents.” The dissenters would hold that both RFRA and the Constitution require the court to “balance” the religious claims of believers against the financial, liberty and equality interests asserted by those who prevailed on those arguments in the political process. Otherwise, asks Justice Ginsburg, “how does the court divine which religious beliefs are worthy of accommodation and which are not?” It is such a good question that the majority reserves it for consideration in a future case.

Third, Justice Ginsburg and the other dissenting justices would have held that refusal of employers and co-workers to pay for the contraceptives—and, by implication, the abortions and perhaps the lethal injections—of their employees, fellow-workers and their dependents is simply “too attenuated” to qualify as a “substantial burden” on anyone’s right “to exercise religion.”

Money is fungible, say the dissenters, and the use to which women put that money once it has been placed into the “undifferentiated funds that finance a wide variety of benefits under comprehensive health plans” is simply not the business of those who are compelled to put up the money.

Summing up:

Stripped to its essentials, the Hobby Lobby case is about money and control. A “single payer” program similar to Medicaid would (at least in theory) use tax receipts to cover all “necessary” drugs and medical services. Well-settled first amendment case law would leave conscientious objectors with no recourse in such a program.

The “individual mandate” embedded in the ACA was also designed to cover all “necessary” drugs and medical services, but Congress had to pay for them by forcing individuals and businesses to use their own hard-earned money to buy these services for themselves and others. In National Federation of Independent Business v. Sebelius (NIFB), a five-justice majority led by Chief Justice John Roberts upheld the “individual mandate” as a valid exercise of Congress’ power to tax. By implication it also upheld the power of Congress to levy tax penalties on those who refuse to comply.

Hobby Lobby asks whether Congress intended to impose those tax penalties on religious believers who operate closely held, for-profit corporations in the commercial marketplace. Reading the A.C.A. in light of RFRA, a five-justice majority that includes the chief justice holds that it did not.

There is a good deal of irony in this outcome. Catholics have supported the concept of universal health care for generations, and supporters of the ACA inside and outside of Congress took great pains to reassure progressive Catholics and evangelical Protestants that both religious freedom and pro-life aversion to public funding for abortions would be respected.

When the Obama Administration decided to use the “essential services” mandate to force employers and co-workers to pay for F.D.A.-approved birth control drugs and devices that have abortifacient effects, the stage was set for a major confrontation. When the administration decided to give the narrowest possible reading to the rights of religious organizations, the Catholic Church and Christian business professionals felt betrayed. They fought back.

In Hobby Lobby, the administration lost. Tax fines are the only effective tool the federal government can use to compel universal compliance with the “essential services” mandate. They are now off the table and will be for the foreseeable future.

And it’s not over. More cases are in the pipeline. Stay tuned.

Robert A. Destro is a professor of law and the director of the Interdisciplinary Program in Law & Religion at the Catholic University of America's Columbus School of Law in Washington, D.C.  

Comments

Michael Barberi | 7/11/2014 - 7:31pm

It is questionable if the Hobby Lobby decision is a victory for religious liberty. Granted some for-profit and non-profit corporations can be exempt from the contraceptive mandate on religious grounds, but employees of such organizations can obtain access to contraceptive products and services at no cost through the employer's insurance company or third party payor. In essence, taxpayers will be paying for contraceptive coverage for these employees.

The owners of these exempt organizations may have peace of mind in this decision, but I doubt that employees of these organizations will view the accommodation offered an impediment to free contraceptive products and services that they believe are not immoral.

There are two other court cases that are more important, namely, the Little Sisters of the Poor and the case before the U.S. Court of Appeals in W.D.C. challenging premium subsidies through Federal exchanges. If the former case is upheld, the contraceptive accommodation will be severely undermined and ineffective. If the latter case is upheld, the lifespan of the ACA will be short.

Marie Rehbein | 7/11/2014 - 4:47pm

Basically, the idea here is that money matters most. If I object to someone using a product that I suspect might be harming her unborn child, I do not have a right to prevent her access to that product in any way other than to follow my money to make sure none of it goes to providing the product. What the Supreme Court seems to have decided in recent rulings isn't the religious freedom issue; rather it has determined that money is speech and that we are entitled to use it to express our opinions.

Louis Candell | 7/11/2014 - 5:47am

There needs to be a complete, repeat, complete separation of church and state. In my opinion, the recent opinion of the SCOTUS in the Hobby Lobby case goes beyond any protection of freedom of religion. Because this decision not only allows certain citizens (in this case, the fictional "corporate person") to exercise a religious belief, it results in forcing those not holding that belief to become subject to the religious view of another. Thus, it is the establishment of a specific religious belief as law of the land. I see this as a violation of the 1st amendment.

Tim O'Leary | 7/11/2014 - 3:35pm

But it is atheists and secularists who are trying to impose their morality and beliefs on Christians. The 1st amendment states: "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof..." Therefore, if atheists/secularists have the benefit of the 2nd part, they need to have the obligation of the 1st. In other words, if atheists cannot be prohibited from practicing their belief of irreligion, then they cannot be permitted to establish their irreligion. It is the atheists who are special pleading, trying to have their freedom to exercise and trying to establish their beliefs on others.

This dispute is not going to go away, and the secularists can never win in a democracy, except in the short term, because demographics are always against them, and democracy follows demographics in the end. But, the best way to protect all and to have peace is to get the government out of the way. Start by getting the government out of schools.

Rick Fueyo | 7/4/2014 - 8:13pm

"Hobby Lobby holds that religious believers do not forfeit their federal statutory right under RFRA “to exercise their religion” when they organize and operate as “closely-held,” for-profit, business corporations. Expressly rejecting the government’s position that only private individuals and non-profit corporations can plausibly argue that they have a right “to exercise their religion,” the court holds that “[b]usiness practices that are compelled or limited by the tenets of a religious doctrine fall comfortably within” both the constitutional and statutory definitions of the phrase “exercise of religion.”'

Though this note faithfully follows the reasoning of the majority opinion, it is a highly disingenuous and tendentious recitation of the law. Any first-year law student knows that a corporation is a separate legal entity, legally distinct from those who hold its shares. That is one of the two primary distinctions for a corporation from a partnership or sole proprietorship. It is hornbook law that a corporation has a separate legal existence and is perpetual, not tied to its shareholders, founders, etc.

To frame the issue as individuals entering the marketplace in groups and maintaining their beliefs would be a legally frivolous argument subject to sanctions if the Supreme Court had not just stated it. It goes against over a century of corporate law, and is actually inconsistent with the tenants of capitalism, which understood at it's core, as distinct from free enterprise, holds that a corporation can amass capital from various investors, who have no greater liability than the amount of their investment. That's distinct from a partnership, in which each individual partner is liable for all of the debts of the business, not just those in proportion to his or her investment. Famously, the corporation is the baby born the lawyer's office, with no rights other than those granted by the state that birthed them in its code.

The justices have done something new with this opinion. Before, at least as a Christian, you had to believe in the salvific power of Jesus Christ to obtain salvation and perpetual life. Now, you just have to be incorporated.

And I'd be curious if the Greens or other owners of such corporations will hold that the corporations are just an extension of them individually if the corporation is sued and they are named as individual parties. I suspect they will move to dismiss, stating that there's no basis for personal liability, and oppose any attempt to "pierce the corporate veil", what lawyers call attempts to set aside the corporation and reach the individual for liability purposes. When it suits them, the corporation will be a shield. But when it doesn't, suddenly their personal conscience will be impinged by the actions the corporation, which will be indistinguishable from their individual existence.

Again, this opinion is nonsense on stilts for anyone with a basic legal understanding.

Tim O'Leary | 7/11/2014 - 4:22pm

Rick - just stating that the ruling is obviously wrong means you are not paying attention to all the legal scholars who agree with the Hobby Lobby decision. If it was one of the 9-0 decisions that Obama has lost, you might have had a point, but in a 5-4 decision, you are just blustering, rather than convincing those who disagree with you and who by their credentials probably know the law better than you, like Prof. Destro, the five justices on the court and the many appellate lawyers and judges. They can't all have failed to pick up the basic law you claim they missed in law school. It might help your sense of objectivity if you really listened to their arguments. Also, here is an insightful article that tries to understand how spart people on both sides can come to such different conclusions. Who is the real Hobby Lobby Bully by Megan McArdle - http://www.bloombergview.com/articles/2014-07-07/who-s-the-real-hobby-lo...

As regards corporate rights, do you think the NYT has no right to free expression because it is a corporation, or that any incorporated Church has no right to practice its religion?

Joseph McGuire | 7/10/2014 - 10:28pm

I have to agree. Hurray for my boss's religious freedom. Where's mine?

Bill Mazzella | 7/2/2014 - 12:02pm

Controllers like Hobby Lobby and the Catholic Bishops of the US now have the SCOTUS to foster their religious beliefs since they cannot persuade their employees or followers to agree with them. This is the first time the court has ruled such on religious grounds. Organized religion has always been destructive when the government lets it enforce their laws. This is a partisan victory. Again using religion as a political football. This is far from a victory for relgious liberty. It is an act of partisanship. It will be interesting to see all the other religious cases that will come before SCOTUS.

Franklin Barrett | 7/3/2014 - 4:12pm

With all due respect Bill, I don't think you (a) read Destro's blog article and (b) actually understand the holding of the case. As a student of law, I think the Professor's analysis is spot on. For anyone to suggest that this is a "partisan" victory is completely ignorant of the religious demographics of either leading party.