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Hobby Lobby: SCOTUS Says Corporations Have Religious Rights

By William Peacock, Esq. | Last updated on

If we had told you that today's Obamacare birth control mandate would be a matter of statutory interpretation, and that five conservative justices would vote against the mandate in the name of corporations' religious rights, would that at all surprise you?

Today's decision was exactly that: closely held corporations have religious rights under the Religious Freedom Restoration Act (RFRA), and therefore, can't be forced to provide birth control to their employees through Obamacare-mandated health coverage. The decision is based on the text of the statutes themselves, as well as the holding that there are less restrictive means for providing birth control: having someone else pay for it by extending the exception for religious nonprofits to closely held corporations with religious owners.

A Matter of Statutes

In a way, this case was easy to predict. In our preview, we outlined two competing lower court decisions: in Hobby Lobby, the Tenth Circuit used that statutes to hold that a corporation was a person and had religious rights. In a Sixth Circuit case (not one of today's cases, but a parallel mandate challenge), the judges used legislative history. Care to guess where the Supreme Court landed?

The Religious Freedom Restoration Act, by its terms, applies to the religious rights of people. But the statute doesn't define the word "person." The Dictionary Act, which provides default definitions for when statutes fail to do so, includes corporations in the definition of person. The two statute combo was the approach taken by the Tenth Circuit, and unsurprisingly, by the five-justice majority of the Supreme Court.

And under the RFRA, any law that burdens a person's religious rights has to be justified by a compelling state interest and achieved via narrowly tailored means -- strict scrutiny, in other words.

Extend the Exception

In both Justice Samuel Alito's majority opinion and a concurrence by Justice Anthony Kennedy, the justices point out that the Government can simply extend its existing exemption for religious non-profits to closely held corporations with religious beliefs.

Justice Alito, after assuming that guaranteeing cost-free access to the four challenged contraceptive methods is a compelling governmental interest, held:

Although HHS has made this system available to religious nonprofits that have religious objections to the contraceptive mandate, HHS has provided no reason why the same system cannot be made available when the owners of for-profit corporations that have similar religious objections. We therefore conclude that this system constitutes an alternative that achieves all of the Government's aims while providing greater respect for religious liberty. And under RFRA, that conclusion means that enforcement of the HHS contraceptive mandate against the objecting parties in these cases is unlawful.

Justice Kennedy downplayed the real world impact, stating, "the Court's opinion does not have the breadth and sweep ascribed to it by the respectful and powerful dissent." He goes on to reiterate what Justice Alito stated: there is a less restrictive means than a contraceptive mandate: extending an existing program for religious nonprofits, one that requires "insurance companies to cover, without cost sharing, contraception coverage for females who wish it."

Slippery Slope Started?

In dissent, Justice Ruth Bader Ginsburg asks: what about other religious-based exemptions, like transfusions? Alito was careful to limit the majority holding to contraception, noting that "[o]ther coverage requirements, such as immunizations, may be supported by different interests [...] and may involve different arguments about the least restrictive means of providing them."

As Ginsburg notes, that won't provide much help for lower courts in future challenges. This could be the beginning of an exemption-by-exemption battle, and years of litigation, over every conceivable religious objection to a medical procedure.

Or it could be that this was, as Alito and Kennedy asserted, a case made simple by an existing program that is easily extended that provided ready proof that there were least restrictive means available. The calculus may not be as favorable for future plaintiffs.

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