Conestoga Wood Specialties Corp. v. Secretary of the United States Department of Health & Human Services , 724 F.3d 377 ( 2013 )

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 13-1144
_____________
CONESTOGA WOOD SPECIALTIES CORPORATION;
NORMAN HAHN; NORMAN LEMAR HAHN; ANTHONY
H. HAHN; ELIZABETH HAHN; KEVIN HAHN,
Appellants
v.
SECRETARY OF THE UNITED STATES DEPARTMENT
OF HEALTH AND HUMAN SERVICES;
SECRETARY UNITED STATES DEPARTMENT OF
LABOR; SECRETARY UNITED STATES DEPARTMENT
OF THE TREASURY; UNITED STATES DEPARTMENT
OF HEALTH AND HUMAN SERVICES;
UNITED STATES DEPARTMENT OF LABOR;
UNITED STATES DEPARTMENT OF THE TREASURY
_______________
On Appeal from the United States District Court
for the Eastern District of Pennsylvania
(D.C. No. 5-12-cv-06744)
District Judge: Honorable Mitchell S. Goldberg
_______________
Argued May 30, 2013
BEFORE: JORDAN, VANASKIE and COWEN,
Circuit Judges
(Filed: July 26, 2013)
Charles W. Proctor, III, Esq. (Argued)
Law Offices of Proctor, Lindsay & Dixon
1204 Baltimore Pike, Suite 200
Chadds Ford, PA 19317
Randall L. Wenger, Esq.
Independence Law Center
23 North Front Street
Harrisburg, PA 17101
Counsel for Appellants
Michelle Renee Bennett, Esq.
United States Department of Justice
Civil Division, Federal Programs Branch
20 Massachusetts Avenue, N.W., Rm. 7130
Washington, DC 20530
Alisa B. Klein, Esq. (Argued)
Mark B. Stern, Esq.
United States Department of Justice
Civil Division
950 Pennsylvania Avenue, N.W., Rm. 7531
Washington, DC 20530
2
Counsel for Appellees
Angela C. Thompson, Esq.
P.O. Box 163461
Sacramento, CA 95816
Counsel for United States Justice Foundation
Amicus on Behalf of Appellants
Ayesha N. Khan, Esq.
Gregory M. Lipper, Esq.
Americans United for the Separation of
Church and State
1301 K Street, N.W.
Suite 850, East Tower
Washington, DC 20005
Counsel for Americans United for Separation of
Church and State; Union for Reform Judaism;
Central Conference of American Rabbis;
Hindu American Foundation;
Women of Reform Judaism
Amici on Behalf of Appellees
Travis S. Weber, Esq.
Boyle Litigation
4660 Trindle Road, Suite 200
Camp Hill, PA 17011
Counsel for Democrats For Life of America;
3
Bart Stupak
Amici on Behalf of Appellants
Mailee R. Smith, Esq.
Americans United for Life
655 Fifteenth Street, N.W.
Suite 410
Washington, DC 20005
Counsel for Association of American
Physicians and Surgeons; American Association
of Pro Life Obstetricians and Gynecologists;
Christian Medical Association;
Catholic Medical Association;
Physicians for Life; National Catholic Bioethics;
National Association of Pro Life Nurses
Amici on Behalf of Appellants
Bruce H. Schneider, Esq.
Stroock, Stroock & Lavan
180 Maiden Lane, 38th Floor
New York, NY 10038
Counsel for American Society for Reproductive
Medicine; Society for Adolescent Health and
Medicine; American Medical Women‘s Association;
National Association of Nurse Practitioners in
Women‘s Health; Society of Family Planning; James
4
Trussell; Susan F. Wood; Don Downing; Kathleen
Besinque; American Society for Emergency
Contraception; Association of Reproductive Health
Professionals; American College of Obstetricians and
Gynecologists; Physicians for Reproductive Choice
and Health
Amici on Behalf of Appellees
Lisa S. Blatt, Esq.
Arnold & Porter
555 Twelfth Street, N.W.
Washington, DC 20004
Counsel for Center for Reproductive Rights; American
Public Health Association;
Guttmacher Institute; National Family Planning and
Reproductive Health Association; National Latina
Institute for Reproductive Health;
National Womens Health Network; Reproductive
Health Technologies Project; R Alta Charo
Amici on Behalf of Appellees
Kimberlee W. Colby, Esq.
Christian Legal Society
Center for Law & Religious Freedom
8001 Braddock Road, Suite 302
Springfield, VA 22151
Counsel for Institutional Religious Freedom Alliance;
C12 Group; Christian Legal Society; Ethics and
Religious Liberty Commission of the Southern
5
Baptist Convention; Association of Christian Schools;
Association for Gospel Rescue Missions; National
Association of Evangelicals; Patrick Henry College;
Prison Fellowship Ministries
Amici on Behalf of Appellants
Sarah Somers, Esq.
National Health Law Program
101 East Weaver Street
Carrboro, NC 27510
Counsel for Asian Pacific American Legal Center;
Black Women‘s Health Imperative; Campaign to End
Aids; Forward Together; Housing Works; Mexican
American Legal Defense and Educational Fund;
National Health Program; National Hispanic Medical
Association; National Women and AIDS Collective;
Sexuality Information & Education Council of the
United States; IPAS; HIV Law Project
Amici on Behalf of Appellants
Brendan M. Walsh, Esq.
Pashman Stein
21 Main Street
Court Plaza South, Suite 100
Hackensack, NJ 07601
Counsel for Orrin G. Hatch; James M. Inhofe; Daniel
R. Coats; Mitch McConnell; Rob Portman; Pat Roberts
Amici on Behalf of Appellants
6
Deborah J. Dewart, Esq.
620 East Sabiston Drive
Swansboro, NC 28584
Counsel for Liberty Life and Law Foundation
Amicus on Behalf of Appellants
Jason P. Gosselin, Esq.
Richard M. Haggerty, Jr., Esq.
Drinker, Biddle & Reath
18th and Cherry Streets
One Logan Square, Suite 2000
Philadelphia, PA 19103
Counsel for New Jersey Family Policy Council
Amicus on Behalf of Appellants
Steven W. Fitschen, Esq.
The National Legal Foundation
2224 Virginia Beach Blvd., Suite 204
Virginia Beach, VA 23454
Counsel for National Legal Foundation; Bradley P.
Jacob; Texas Center for Defense of Life
Amici on Behalf of Appellees
Charles E. Davidow, Esq.
Paul, Weiss, Rifkind, Wharton & Garrison
2001 K Street, N.W., Suite 600
Washington, DC 20006
7
Counsel for National Organization for Women
Foundation; National Women‘s Law Center;
Population Connection; Service Employees
International Union; Ibis Reproductive Health;
MergerWatch; Naral Pro Choice America; Planned
Parenthood Association of the Mercer Area Inc.;
Planned Parenthood of Central Pennsylvania; Planned
Parenthood of Delaware Inc.; Planned Parenthood of
Northeast Middle Pennsylvania and Bucks County;
Planned Parenthood of Southeastern Pennsylvania;
Planned Parenthood of Western Pennsylvania; Raising
Women‘s Voices for the Health Care We Need;
Women‘s Law Project; American Association
University Women
Amici on Behalf of Appellees
Emily M. Bell, Esq.
Clymer, Musser, Brown & Conrad
408 West Chestnut Street
Lancaster, PA 17603
Counsel for Breast Cancer Prevention Institute
Coalition on Abortion Breast Cancer;
Polycarp Research Institute;
Amici on Behalf of Appellants
Daniel Mach, Esq.
American Civil Liberties Union
915 15th Street, N.W., 6th Floor
Washington, DC 20005
8
Counsel for American Civil Liberties Union;
American Civil Liberties Union of Pennsylvania;
Anti Defamation League; Catholics for a Free Choice;
Hadassah; Women‘s Zionist Organization of America
Inc. Interfaith Alliance Foundation; National Coalition
of American Nuns; National Council of Women Inc.
Religious Coalition for Reproductive Choice Religious
Institute; Unitarian Universalist Association;
Unitarian Universalist Women‘s Federation
Amici on Behalf of Appellees
Thomas W. Ude, Esq.
Lambda Legal Defense & Education Fund, Inc.
120 Wall Street, 19th Floor
New York, NY 10005
Counsel for Lambda Legal Defense & Education Fund
Inc.
Amicus on Behalf of Appellees
______________
OPINION
_______________
COWEN, Circuit Judge.
Appellants Conestoga Wood Specialties Corporation
(―Conestoga‖), Norman Hahn, Elizabeth Hahn, Norman
Lemar Hahn, Anthony Hahn, and Kevin Hahn (collectively,
―the Hahns‖) appeal from an order of the District Court
9
denying their motion for a preliminary injunction. In their
Complaint, Appellants allege that regulations promulgated by
the Department of Health and Human Services (―HHS‖),
which require group health plans and health insurance issuers
to provide coverage for contraceptives, violate the Religious
Freedom Restoration Act, 42 U.S.C. § 2000bb (―RFRA‖) and
the Free Exercise Clause of the First Amendment of the
United States Constitution. 1 The District Court denied a
preliminary injunction, concluding that Appellants were
unlikely to succeed on the merits of their claims. See
Conestoga Wood Specialties Corp. v. Sebelius, No. 12-CV-
6744, 2013 WL 140110 (E.D. Pa. Jan. 11, 2013). Appellants
then filed an expedited motion for a stay pending appeal with
this Court, which was denied. See Conestoga Wood
Specialties Corp. v. Sec’y of the United States Dep’t of Health
& Human Servs., No. 13-1144, 2013 WL 1277419 (3d Cir.
Feb. 8, 2013). Now, we consider the fully briefed appeal from
the District Court‘s denial of a preliminary injunction.
Before we can even reach the merits of the First
Amendment and RFRA claims, we must consider a threshold
issue: whether a for-profit, secular corporation is able to
1
The Complaint also alleges that the regulations
violate the Establishment Clause, the Free Speech Clause, the
Due Process Clause, and the Administrative Procedure Act.
While the District Court‘s opinion addressed some of these
additional claims, Appellants have limited their appeal to
whether the regulations violate the RFRA and the Free
Exercise Clause.
10
engage in religious exercise under the Free Exercise Clause of
the First Amendment and the RFRA. As we conclude that for-
profit, secular corporations cannot engage in religious
exercise, we will affirm the order of the District Court.
I.
In 2010, Congress passed the Patient Protection and
Affordable Care Act, Pub. L. No. 111-148 (March 23, 2010)
(―ACA‖). The ACA requires employers with fifty or more
employees to provide their employees with a minimum level
of health insurance. The ACA requires non-exempt group
plans to provide coverage without cost-sharing for
preventative care and screening for women in accordance with
guidelines created by the Health Resources and Services
Administration (―HRSA‖), a subagency of HHS. See 42
U.S.C. § 300gg-13(a)(4).
The HRSA delegated the creation of guidelines on this
issue to the Institute of Medicine (―IOM‖). The IOM
recommended that the HRSA adopt guidelines that require
non-exempt group plans to cover ―[a]ll Food and Drug
Administration approved contraceptive methods, sterilization
procedures, and patient education and counseling for women
with reproductive capacity.‖ 2 These recommended guidelines
2
See Women‘s Preventive Services: Required Health
Plan Coverage Guidelines, available at
www.hrsa.gov/womensguidelines (last visited July 25, 2013).
11
were approved by the HRSA. On February 15, 2012, HHS,
the Department of the Treasury, and the Department of Labor
published final rules memorializing the guidelines. See 77
Fed. Reg. 8725 (Feb. 15, 2012).3 Under the regulations, group
health plans and health insurance issuers are required to
provide coverage consistent with the HRSA guidelines in plan
years beginning on or after August 1, 2012, unless the
employer or the plan is exempt. 4 Appellants refer to this
requirement as the ―Mandate,‖ and we use this term
throughout this opinion. Employers who fail to comply with
the Mandate face a penalty of $100 per day per offending
employee. See 26 U.S.C. § 4980D. The Department of Labor
and plan participants may also bring a suit against an employer
that fails to comply with the Mandate. See 29 U.S.C. § 1132.
II.
3
These regulations were updated on July 2, 2013. See
78 Fed. Reg. 39870 (July 2, 2013). The recent changes have
no impact on this litigation.
4
The exemptions encompass ―grandfathered‖ plans,
which are plans that were in existence on March 23, 2010, see
45 C.F.R. § 147.140 and ―religious employers,‖ see 45 C.F.R.
§ 147.130(a)(1)(iv)(B). Additionally, the ACA requirement
to provide employer sponsored health insurance to employees
is entirely inapplicable to employers that have fewer than 50
employees. See 26 U.S.C. § 4980H(a), (c)(2)(A).
12
The Hahns own 100 percent of the voting shares of
Conestoga. Conestoga is a Pennsylvania for-profit corporation
that manufactures wood cabinets and has 950 employees. The
Hahns practice the Mennonite religion. According to their
Amended Complaint, the Mennonite Church ―teaches that
taking of life which includes anything that terminates a
fertilized embryo is intrinsic evil and a sin against God to
which they are held accountable.‖ (Am. Compl. ¶ 30.) 5
Specifically, the Hahns object to two drugs that must be
provided by group health plans under the Mandate that ―may
cause the demise of an already conceived but not yet attached
human embryo.‖ (Id. at ¶ 45.) These are ―emergency
contraception‖ drugs such as Plan B (the ―morning after pill‖)
and ella (the ―week after pill‖). The Amended Complaint
alleges that it is immoral and sinful for Appellants to
intentionally participate in, pay for, facilitate, or otherwise
support these drugs. (Id. at ¶ 32.) Conestoga has been subject
to the Mandate as of January 1, 2013, when its group health
plan came up for renewal. As a panel of this Court previously
5
In addition, on October 31, 2012, Conestoga‘s Board
of Directors adopted ―The Hahn Family Statement on the
Sanctity of Human Life,‖ which provides, amongst other
things, that ―The Hahn Family believes that human life begins
at conception (at the point where an egg and sperm unite) and
that it is a sacred gift from God and only God has the right to
terminate human life. Therefore, it is against our moral
conviction to be involved in the termination of human life
through abortion, suicide, euthanasia, murder, or any other
acts that involve the taking of human life.‖ (Id. at ¶ 92.)
13
denied an injunction pending appeal, Conestoga is currently
subject to the Mandate, and in fact, Appellants‘ counsel
represented during oral argument that Conestoga is currently
complying with the Mandate.
III.
We review a district court‘s denial of a preliminary
injunction for abuse of discretion, but review the underlying
factual findings for clear error and questions of law de novo.
Am. Express Travel Related Servs. v. Sidamon-Eristoff, 669
F.3d 359, 366 (3d Cir. 2012). The District Court had
jurisdiction over this case under 28 U.S.C. § 1331. This Court
has appellate jurisdiction under 28 U.S.C. § 1292(a)(1).
―A party seeking a preliminary injunction must show:
(1) a likelihood of success on the merits; (2) that it will suffer
irreparable harm if the injunction is denied; (3) that granting
preliminary relief will not result in even greater harm to the
nonmoving party; and (4) that the public interest favors such
relief.‖ Kos Pharms, Inc. v. Andrx Corp., 369 F.3d 700, 708
(3d Cir. 2004). A plaintiff seeking an injunction must meet all
four criteria, as ―[a] plaintiff‘s failure to establish any element
in its favor renders a preliminary injunction inappropriate.‖
NutraSweet Co. v. Vit-Mar Enters., Inc., 176 F.3d 151, 153
(3d Cir. 1999). This is the same standard applied in the
District Court, and, on appeal, no party has questioned its
14
accuracy. 6 We will first consider whether Appellants are
likely to succeed on the merits of their claim, beginning with
the claims asserted by Conestoga, a for-profit, secular
corporation.
IV.
A.
First, we turn to Conestoga‘s claims under the First
Amendment. Under the First Amendment, ―Congress shall
make no law respecting the establishment of religion or
prohibiting the free exercise thereof.‖ The threshold question
for this Court is whether Conestoga, a for-profit, secular
corporation, can exercise religion. In essence, Appellants
offer two theories under which we could conclude that
Conestoga can exercise religion: (a) directly, under the
Supreme Court‘s recent decision in Citizens United, and (b)
indirectly, under the ―passed through‖ method that has been
articulated by the Court of Appeals for the Ninth Circuit. We
will discuss each theory in turn.
6
The dissent has undertaken a scholarly survey of the
proper standard for obtaining a preliminary injunction
throughout the country. However, Appellants never took an
appeal of the preliminary injunction standard applied by the
District Court. (See Appellants‘ Br. at 4-6 (statement of
issues presented for review).) Moreover, the dissent
acknowledges that it ―may be true‖ that the plaintiff‘s failure
to satisfy any element in its favor renders a preliminary
injunction inappropriate. (Dissenting Op. at 9.)
15
In Citizens United, the Supreme Court held that ―the
Government may not suppress political speech on the basis of
the speaker‘s corporate identity,‖ and it accordingly struck
down statutory restrictions on corporate independent
expenditure. Citizens United v. Fed. Election Comm’n, 558
U.S. 310, 365 (2010). Citizens United recognizes the
application of the First Amendment to corporations generally
without distinguishing between the Free Exercise Clause and
the Free Speech Clause, both which are contained within the
First Amendment. Accordingly, whether Citizens United is
applicable to the Free Exercise Clause is a question of first
impression. See Hobby Lobby Stores, Inc. v. Sebelius, 133 S.
Ct. 641, 643 (2012) (Sotomayor, Circuit Justice) (―This court
has not previously addressed similar RFRA or free exercise
claims brought by closely held for-profit corporations and
their controlling shareholders . . . .‖).
While ―a corporation is ‗an artificial being, invisible,
intangible, and existing only in contemplation of law,‘ . . . a
wide variety of constitutional rights may be asserted by
corporations.‖ Consol. Edison Co. of N.Y., Inc. v. Pataki, 292
F.3d 338, 347 (2d Cir. 2002) (quoting Dartmouth Coll. v.
Woodward, 17 U.S. (4 Wheat.) 518, 636 (1819) (Marshall,
C.J.)) In analyzing whether constitutional guarantees apply to
corporations, the Supreme Court has held that certain
guarantees are held by corporations and that certain guarantees
are ―purely personal‖ because ―the ‗historic function‘ of the
particular guarantee has been limited to the protection of
individuals.‖ First Nat’l Bank of Boston v. Bellotti, 435 U.S.
765, 778 n.14 (1978) (internal citation omitted). The Bellotti
16
Court observed:
Corporate identity has been determinative in
several decisions denying corporations certain
constitutional rights, such as the privilege
against compulsory self-incrimination, Wilson
v. United States, 221 U.S. 361, 382–386, 31 S.
Ct. 538, 545–546, 55 L. Ed. 771 (1911), or
equality with individuals in the enjoyment of a
right to privacy, California Bankers Assn. v.
Shultz, 416 U.S. 21, 65–67, 94 S. Ct. 1494,
1519–1520, 39 L. Ed. 2d 812 (1974); United
States v. Morton Salt Co., 338 U.S. 632, 651–
652, 70 S. Ct. 357, 368–369, 94 L. Ed. 401(1950), but this is not because the States are free
to define the rights of their creatures without
constitutional limit. Otherwise, corporations
could be denied the protection of all
constitutional guarantees, including due process
and the equal protection of the laws. Certain
―purely personal‖ guarantees, such as the
privilege against compulsory self-incrimination,
are unavailable to corporations and other
organizations because the ―historic function‖ of
the particular guarantee has been limited to the
protection of individuals. United States v.
White, 322 U.S. 694, 698–701, 64 S. Ct. 1248,
1251–1252, 88 L. Ed. 1542 (1944). Whether or
not a particular guarantee is ―purely personal‖
or is unavailable to corporations for some other
reason depends on the nature, history, and
17
purpose of the particular constitutional
provision.
Id. Thus, we must consider whether the Free Exercise Clause
has historically protected corporations, or whether the
―guarantee is ‗purely personal‘ or is unavailable to
corporations‖ based on the ―nature, history, and purpose of
[this] particular constitutional provision.‖ Id.In Citizens United, the Supreme Court pointed out that
it has ―recognized that First Amendment protection extends to
corporations.‖ Citizens United, 558 U.S. at 342. It then cited
to more than twenty cases, from as early as the 1950‘s,
including landmark cases such as New York Times Co. v.
Sullivan, 376 U.S. 254 (1964), in which the Court recognized
that First Amendment free speech rights apply to corporations.
See id. The Citizens United Court particularly relied on
Bellotti, which struck down a state-law prohibition on
corporate independent expenditures related to referenda issues.
Bellotti held:
We thus find no support in the First or
Fourteenth Amendment, or in the decisions of
this Court, for the proposition that speech that
otherwise would be within the protection of the
First Amendment loses that protection simply
because its source is a corporation that cannot
prove, to the satisfaction of a court, a material
effect on its business or property. [That
proposition] amounts to an impermissible
legislative prohibition of speech based on the
18
identity of the interests that spokesmen may
represent in public debate over controversial
issues and a requirement that the speaker have a
sufficiently great interest in the subject to
justify communication.
Bellotti, 435 U.S. at 784. Discussing Bellotti’s rationale,
Citizens United stated that the case ―rested on the principle
that the Government lacks the power to ban corporations from
speaking.‖ Citizens United, 558 U.S. at 347; see also Pac.
Gas & Elec. Co. v. Pub. Utils. Comm’n of Cal., 475 U.S. 1, 8
(1986) (―The identity of the speaker is not decisive in
determining whether speech is protected‖ as ―[c]orporations
and other associations, like individuals, contribute to the
‗discussion, debate, and the dissemination of information and
ideas‘ that the First Amendment seeks to foster.‖) (quoting
Bellotti, 435 U.S. at 795).
Citizens United is thus grounded in the notion that the
Court has a long history of protecting corporations‘ rights to
free speech. Citizens United overruled Austin v. Michigan
Chamber of Commerce, 494 U.S. 652 (1990), a case in which
the Court had ―uph[eld] a direct restriction on the independent
expenditure of funds for political speech for the first time in
[this Court‘s] history.‖ Citizens United, 558 U.S. at 347(quoting Austin, 494 U.S. at 695 (Kennedy, J., dissenting)).
The Citizens United Court found that it was ―confronted with
conflicting lines of precedent: a pre-Austin line that forbids
restrictions on political speech based on the speaker‘s
corporate identify and a post-Austin line that permits them.‖
Id. at 348. Faced with this conflict, the Court decided that
19
Austin was wrongly decided, based on the otherwise
consistent line of cases in which corporations were found to
have free speech rights.
We must consider the history of the Free Exercise
Clause and determine whether there is a similar history of
courts providing free exercise protection to corporations. We
conclude that there is not. In fact, we are not aware of any
case preceding the commencement of litigation about the
Mandate, in which a for-profit, secular corporation was itself
found to have free exercise rights. 7 Such a total absence of
caselaw takes on even greater significance when compared to
the extensive list of Supreme Court cases addressing the free
speech rights of corporations.
After all, as the Supreme Court observed in Schempp,
the purpose of the Free Exercise Clause ―is to secure religious
liberty in the individual by prohibiting any invasions thereof
by civil authority.‖ Sch. Dist. of Abington Twp. v. Schempp,
374 U.S. 203, 223 (1963) (emphasis added). And as the
District Court aptly noted in its opinion, ―[r]eligious belief
takes shape within the minds and hearts of individuals, and its
protection is one of the more uniquely ‗human‘ rights provided
7
We acknowledge that the Court of Appeals for the
Tenth Circuit, in an eight judge en banc panel, in six separate
opinions, recently held that for-profit, secular corporations
can assert RFRA and free exercise claims in some
circumstances. See Hobby Lobby Stores, Inc. v. Sebelius, No.
12-6294, 2013 WL 3216103 (10th Cir. June 27, 2013). We
respectfully disagree with that Court‘s analysis.
20
by the Constitution.‖ Conestoga, 2013 WL 140110, at *7.
We do not see how a for-profit ―artificial being, invisible,
intangible, and existing only in contemplation of law,‖ Consol.
Edison Co., 292 F.3d at 346 (quoting Dartmouth Coll., 17 U.S.
at 636 (Marshall, C.J.)), that was created to make money could
exercise such an inherently ―human‖ right.
We are unable to determine that the ―nature, history,
and purpose‖ of the Free Exercise Clause supports the
conclusion that for-profit, secular corporations are protected
under this particular constitutional provision. See Bellotti¸ 435
U.S. at 778 n.14. Even if we were to disregard the lack of
historical recognition of the right, we simply cannot
understand how a for-profit, secular corporation—apart from
its owners—can exercise religion. As another court
considering a challenge to the Mandate noted:
General business corporations do not, separate
and apart from the actions or belief systems of
their individual owners or employees, exercise
religion. They do not pray, worship, observe
sacraments or take other religiously-motivated
actions separate and apart from the intention
and direction of their individual actors.
Hobby Lobby Stores, Inc. v. Sebelius, 870 F. Supp. 2d 1278,
1291 (W.D. Okla. 2012), rev’d en banc, No. 12-6294, 2013
WL 3216103 (10th Cir. June 27, 2013); see also Hobby Lobby
Stores, Inc., 2013 WL 3216103, at *51 (Briscoe, C.J.,
concurring in part and dissenting in part) (questioning
―whether a corporation can ‗believe‘ at all, see Citizens
21
United, 130 S.Ct. at 972 (‗It might also be added that
corporations have no consciences, no beliefs, no feelings, no
thoughts, no desires.‘) (Stevens, J., concurring in part and
dissenting in part).‖).
In urging us to hold that for-profit, secular corporations
can exercise religion, Appellants, as well as the dissent, cite to
cases in which courts have ruled in favor of free exercise
claims advanced by religious organizations. See, e.g.,
Gonzalez v. O Centro Espirita Beneficente Uniao Do Vegetal,
546 U.S. 418 (2006); Church of the Lukumi Babalu Aye, Inc.
v. Hialeah, 508 U.S. 520 (1993). None of the cases relied on
by the dissent involve secular, for-profit corporations. We will
not draw the conclusion that, just because courts have
recognized the free exercise rights of churches and other
religious entities, it necessarily follows that for-profit, secular
corporations can exercise religion. As the Supreme Court
recently noted, ―the text of the First Amendment . . . gives
special solicitude to the rights of religious organizations.‖
Hosanna-Tabor Evangelical Lutheran Church & Sch. v.
EEOC, 132 S. Ct. 694, 706 (2012). That churches—as means
by which individuals practice religion—have long enjoyed the
protections of the Free Exercise Clause is not determinative of
the question of whether for-profit, secular corporations should
be granted these same protections.
Appellants also argue that Citizens United is applicable
to the Free Exercise Clause because ―the authors of the First
Amendment only separated the Free Exercise Clause and the
Free Speech Clause by a semi-colon, thus showing the
continuation of intent between the two.‖ (Appellants‘ Br. at
22
34.) We are not persuaded that the use of a semi-colon means
that each clause of the First Amendment must be interpreted
jointly.
In fact, historically, each clause has been interpreted
separately. Accordingly, the courts have developed different
tests in an effort to apply these clauses. For example, while
the various clauses of the First Amendment have been
incorporated and made applicable to the states by the Due
Process Clause of the Fourteenth Amendment, the Supreme
Court did so at different times. Incorporation of the clauses of
the First Amendment began with Gitlow v. New York, 268
U.S. 652, 666 (1925), where the Court noted that ―we may and
do assume that freedom of speech and of the press—which are
protected by the First Amendment from abridgment by
Congress—are among the fundamental rights and ‗liberties‘
protected by the due process clause of the Fourteenth
Amendment from impairment by the States.‖ More than ten
years later, in De Jonge v. Oregon, 299 U.S. 353 (1937), the
Court incorporated the right of peaceable assembly. In doing
so, the Court cited to Gitlow, and noted that ―[t]he right of
peaceable assembly is a right cognate to those of free speech
and free press and is equally fundamental.‖ Id. at 364. The
language is important—even though the Free Speech Clause
and the Petition Clause appear next to one another in the First
Amendment, the Court did not find that Gitlow had already
decided that the Petition Clause was incorporated, but rather
cited Gitlow as precedent to expand the incorporation doctrine
to cover the Petition Clause.
Several years later, in Cantwell v. Connecticut, 310
23
U.S. 296 (1940), the Supreme Court incorporated the Free
Exercise Clause. The Cantwell Court did not cite to Gitlow as
authority for incorporating the Free Exercise Clause; in other
words, it did not automatically follow that the Free Exercise
Clause was incorporated just because the Free Speech Clause
was incorporated. Seven years after Cantwell, in Everson v.
Board of Education, 330 U.S. 1 (1947), the Court incorporated
the Establishment Clause. In Everson, the Court cited to
Cantwell and noted that the Court‘s interpretation of the Free
Exercise Clause should be applied to the Establishment
Clause. Id. at 15. But notably, it took seven years for the
Court to hold this; and following the same pattern, Cantwell
did not automatically incorporate the Establishment Clause.
Thus, it does not automatically follow that all clauses of the
First Amendment must be interpreted identically.
Second, Appellants argue that Conestoga can exercise
religion under a ―passed through‖ theory, which was first
developed by the Court of Appeals for the Ninth Circuit in
EEOC v. Townley Engineering & Manufacturing Company,
859 F.2d 610 (9th Cir. 1988), and affirmed in Stormans, Inc. v.
Selecky, 586 F.3d 1109 (9th Cir. 2009). In Townley and
Stormans, the Ninth Circuit held that for-profit corporations
can assert the free exercise claims of their owners.
In Townley, the plaintiff was a closely-held
manufacturing company whose owners made a ―covenant
with God requir[ing] them to share the Gospel with all of
their employees.‖ Townley, 859 F.2d at 620. Townley, the
plaintiff corporation, sought an exemption, on free exercise
grounds, from a provision of Title VII of the Civil Rights Act
24
that required it to accommodate employees asserting religious
objections to attending the company‘s mandatory devotional
services. Although the plaintiff urged the ―court to hold that
it is entitled to invoke the Free Exercise Clause on its own
behalf,‖ the Ninth Circuit deemed it ―unnecessary to address
the abstract issue whether a for profit corporation has rights
under the Free Exercise Clause independent of those of its
shareholders and officers.‖ Id. at 619-20. Rather, the court
concluded that, ―Townley is merely the instrument through
and by which Mr. and Mrs. Townley express their religious
beliefs.‖ Id. at 619. As ―Townley presents no rights of its
own different from or greater than its owners‘ rights,‖ the
Ninth Circuit held that ―the rights at issue are those of Jake
and Helen Townley.‖ Id. at 620. The court then examined the
rights at issue as those of the corporation‘s owners, ultimately
concluding that Title VII‘s requirement of religious
accommodation did not violate the Townleys‘ free exercise
rights. Id. at 621.
The Ninth Circuit subsequently applied Townley‘s
reasoning in Stormans. There, a pharmacy brought a Free
Exercise Clause challenge to a state regulation requiring it to
dispense Plan B, an emergency contraceptive drug.
Stormans, 586 F.3d at 1117. In analyzing whether the
pharmacy had standing to assert the free exercise rights of its
owners, the court emphasized that the pharmacy was a
―fourth-generation, family-owned business whose
shareholders and directors are made up entirely of members
of the Stormans family.‖ Id. at 1120. As in Townley, it
―decline[d] to decide whether a for-profit corporation can
assert its own rights under the Free Exercise Clause and
25
instead examine[d] the rights at issue as those of the corporate
owners.‖ Id. at 1119. The court concluded that the pharmacy
was ―an extension of the beliefs of members of the Stormans
family, and that the beliefs of the Stormans family are the
beliefs of‖ the pharmacy. Id. at 1120. Because the pharmacy
did ―not present any free exercise rights of its own different
from or greater than its owners‘ rights,‖ the Ninth Circuit
held, as it had in Townley, that the company had ―standing to
assert the free exercise rights of its owners.‖ Id.Appellants argue that Conestoga is permitted to assert
the free exercise claims of the Hahns, its owners, under the
Townley/Stormans ―passed through‖ theory. After carefully
considering the Ninth Circuit‘s reasoning, we are not
persuaded. We decline to adopt the Townley/Stormans theory,
as we believe that it rests on erroneous assumptions regarding
the very nature of the corporate form. In fact, the Ninth
Circuit did not mention certain basic legal principles
governing the status of a corporation and its relationship with
the individuals who create and own the entity. It is a
fundamental principle that ―incorporation‘s basic purpose is to
create a distinct legal entity, with legal rights, obligations,
powers, and privileges different from those of the natural
individuals who created‖ the corporation. Cedric Kushner
Promotions, Ltd. v. King, 533 U.S. 158, 163 (2001). The
―passed through‖ doctrine fails to acknowledge that, by
incorporating their business, the Hahns themselves created a
distinct legal entity that has legally distinct rights and
responsibilities from the Hahns, as the owners of the
corporation. See Barium Steel Corp. v. Wiley, 108 A.2d 336,
341 (Pa. 1954) (―It is well established [under Pennsylvania
26
law] that a corporation is a distinct and separate entity,
irrespective of the persons who own all its stock.‖). The
corporate form offers several advantages ―not the least of
which was limitation of liability,‖ but in return, the
shareholder must give up some prerogatives, ―including that of
direct legal action to redress an injury to him as primary
stockholder in the business.‖ Kush v. Am. States Ins. Co., 853
F.2d 1380, 1384 (7th Cir. 1988). Thus, under Pennsylvania
law—where Conestoga is incorporated—―[e]ven when a
corporation is owned by one person or family, the corporate
form shields the individual members of the corporation from
personal liability.‖ Kellytown Co. v. Williams, 426 A.2d 663,
668 (Pa. Super. Ct. 1981).
Since Conestoga is distinct from the Hahns, the
Mandate does not actually require the Hahns to do anything.
All responsibility for complying with the Mandate falls on
Conestoga. Conestoga ―is a closely-held, family-owned firm,
and [we] suspect there is a natural inclination for the owners of
such companies to elide the distinction between themselves
and the companies they own.‖ Grote v. Sebelius, 708 F.3d
850, 857 (7th Cir. 2013) (Rovner, J., dissenting). But, it is
Conestoga that must provide the funds to comply with the
Mandate—not the Hahns. We recognize that, as the sole
shareholders of Conestoga, ultimately the corporation‘s profits
will flow to the Hahns. But, ―[t]he owners of an LLC or
corporation, even a closely-held one, have an obligation to
respect the corporate form, on pain of losing the benefits of
that form should they fail to do so.‖ Id. at 858 (Rovner, J.,
dissenting). ―The fact that one person owns all of the stock
does not make him and the corporation one and the same
27
person, nor does he thereby become the owner of all the
property of the corporation.‖ Wiley, 108 A.2d at 341. The
Hahn family chose to incorporate and conduct business
through Conestoga, thereby obtaining both the advantages and
disadvantages of the corporate form. We simply cannot ignore
the distinction between Conestoga and the Hahns. We hold—
contrary to Townley and Stormans—that the free exercise
claims of a company‘s owners cannot ―pass through‖ to the
corporation.
B.
Next, we consider Conestoga‘s RFRA claim. Under the
RFRA, ―[g]overnment shall not substantially burden a
person‘s exercise of religion even if the burden results from a
rule of general applicability [unless the burden] (1) is in
furtherance of a compelling governmental interest; and (2) is
the least restrictive means of furthering that compelling
governmental interest.‖ 42 U.S.C. §§ 2000bb-1(a)-(b). As
with the inquiry under the Free Exercise Clause, our
preliminary inquiry is whether a for-profit, secular corporation
can assert a claim under the RFRA. Under the plain language
of the statute, the RFRA only applies to a ―person‘s exercise
of religion.‖ Id. at § 2000bb-1(a).
Our conclusion that a for-profit, secular corporation
cannot assert a claim under the Free Exercise Clause
necessitates the conclusion that a for-profit, secular
corporation cannot engage in the exercise of religion. Since
Conestoga cannot exercise religion, it cannot assert a RFRA
claim. We thus need not decide whether such a corporation is
28
a ―person‖ under the RFRA.
V.
Finally, we consider whether the Hahns, as the owners
of Conestoga, have viable Free Exercise Clause and RFRA
claims on their own. For the same reasons that we concluded
that the Hahns‘ claims cannot ―pass through‖ Conestoga, we
hold that the Hahns do not have viable claims. The Mandate
does not impose any requirements on the Hahns. Rather,
compliance is placed squarely on Conestoga. If Conestoga
fails to comply with the Mandate, the penalties—including
fines, see 26 U.S.C. § 4980D, and civil enforcement, see 29
U.S.C. § 1132—would be brought against Conestoga, not the
Hahns. As the Hahns have decided to utilize the corporate
form, they cannot ―move freely between corporate and
individual status to gain the advantages and avoid the
disadvantages of the respective forms.‖ Potthoff v. Morin, 245
F.3d 710, 717 (8th Cir. 2001) (quoting Kush, 853 F.2d at
1384). Thus, we conclude that the Hahns are not likely to
succeed on their free exercise and RFRA claims.
VI.
As Appellants have failed to show that they are likely to
succeed on the merits of their Free Exercise Clause and RFRA
claims, we need not decide whether Appellants have shown
that they will suffer irreparable harm, that granting preliminary
relief will not result in even greater harm to the Government,
and that the public interest favors the relief of a preliminary
injunction. See NutraSweet Co., 176 F.3d at 153 (―A
29
plaintiff‘s failure to establish any element in its favor renders a
preliminary injunction inappropriate.‖). Therefore, we will
affirm the District Court‘s order denying Appellants‘ motion
for a preliminary injunction.
* * *
We recognize the fundamental importance of the free
exercise of religion. As Congress stated, in passing the RFRA
and restoring the compelling interest test to laws that
substantially burden religion, ―the framers of the Constitution,
recognizing free exercise of religion as an unalienable right,
secured its protection in the First Amendment to the
Constitution.‖ 42 U.S.C. § 2000bb(a). Thus, our decision
here is in no way intended to marginalize the Hahns‘
commitment to the Mennonite faith. We accept that the Hahns
sincerely believe that the termination of a fertilized embryo
constitutes an ―intrinsic evil and a sin against God to which
they are held accountable,‖ (Compl. ¶ 30), and that it would be
a sin to pay for or contribute to the use of contraceptives
which may have such a result. We simply conclude that the
law has long recognized the distinction between the owners of
a corporation and the corporation itself. A holding to the
contrary—that a for-profit corporation can engage in religious
exercise—would eviscerate the fundamental principle that a
corporation is a legally distinct entity from its owners.
30
Conestoga Wood Specialties Corp., et al. v. U.S. Dep’t of
Health & Human Servs., et al., (No. 13-1144)
JORDAN, Circuit Judge, dissenting.
Having previously dissented from the denial of a stay
pending appeal in this case, I now have a second opportunity
to consider the government‟s violation of the religious
freedoms of Conestoga Wood Specialties Corporation
(“Conestoga”) and its owners, the Hahns, a family of devout
Mennonite Christians who believe in the sanctity of human
life. The Hahns do not want to be forced to pay for other
people to obtain contraceptives and sterilization services,
particularly the drugs known as “Plan B” (or the “morning
after pill”) and “Ella” (or the “week after pill”), which they
view as chemical killers of actual lives in being. Sadly, the
outcome for the Hahns and their business is the same this
time as it was the last time they were before us. My
colleagues, at the government‟s urging, are willing to say that
the Hahns‟ choice to operate their business as a corporation
carries with it the consequence that their rights of conscience
are forfeit.
That deeply disappointing ruling rests on a cramped
and confused understanding of the religious rights preserved
by Congressional action and the Constitution. The
government takes us down a rabbit hole where religious rights
are determined by the tax code, with non-profit corporations
able to express religious sentiments while for-profit
corporations and their owners are told that business is
business and faith is irrelevant. Meanwhile, up on the
surface, where people try to live lives of integrity and
purpose, that kind of division sounds as hollow as it truly is. I
do not believe my colleagues or the District Court judge
whose opinion we are reviewing are ill-motivated in the least,
but the outcome of their shared reasoning is genuinely tragic,
and one need not have looked past the first row of the gallery
during the oral argument of this appeal, where the Hahns
were seated and listening intently, to see the real human
suffering occasioned by the government‟s determination to
either make the Hahns bury their religious scruples or watch
while their business gets buried. So, as I did the last time this
case was before us, I respectfully dissent.
I. Background
Five members of the Hahn family – Norman,
Elizabeth, Norman Lemar, Anthony, and Kevin – own 100
percent of Conestoga, which Norman founded nearly fifty
years ago and which, as noted by the Majority, is a
Pennsylvania corporation that manufactures wood cabinets.
(Maj. Op. at 12.) The Hahns are hands-on owners. They
manage their business and try to turn a profit, with the help of
Conestoga‟s 950 full-time employees. It is undisputed that
the Hahns are entirely committed to their faith, which
influences all aspects of their lives. They feel bound, as the
District Court observed, “to operate Conestoga in accordance
with their religious beliefs and moral principles.” Conestoga
Wood Specialties Corp. v. Sebelius, No. 12-6744, 2013 WL
140110, at *3 (E.D. Pa. Jan. ll, 2013). One manifestation of
that commitment is the “Statement on the Sanctity of Human
Life” adopted by Conestoga‟s Board of Directors on October
31, 2012, proclaiming that
[t]he Hahn Family believes that human life
begins at conception (at the point where an egg
2
and sperm unite) and that it is a sacred gift from
God and only God has the right to terminate
human life. Therefore it is against our moral
conviction to be involved in the termination of
human life through abortion, suicide,
euthanasia, murder, or any other acts that
involve the deliberate taking of human life.
Id. at *18 n.5.
Accordingly, the Hahns believe that facilitating the use
of contraceptives, especially ones that destroy a fertilized
ovum,1 is a violation of their core religious beliefs. (Am.
1
Their concern seems aimed particularly at
contraceptives that work after conception (see Am. Compl. at
9 (noting concern over mandated “drugs or devices that may
cause the demise of an already conceived but not yet attached
human embryo, such as „emergency contraception‟ or „Plan
B‟ drugs (the so called „morning after‟ pill)”), and the
concern apparently increases the further along in the
development of the fertilized egg that the contraceptive action
of a drug or device takes place (see id. at 10 (discussing
objections to “a drug called „ella‟ (the so called „week after‟
pill), which studies show can function to kill embryos even
after they have attached to the uterus, by a mechanism similar
to the abortion drug RU-486”). Being forced to assist in the
acquisition and use of abortifacients is obviously of great
concern to them. (See Appellants‟ Opening Br. at 10-11
(“[T]he Hahns believe that it would be sinful and immoral for
them to intentionally participate in, pay for, facilitate, or
otherwise support any contraception with an abortifacient
effect through health insurance coverage they offer at
3
Conestoga.”).)
At oral argument, counsel for the government insisted
that “abortifacient” is a “theological term,” and that, “for
federal law purposes, a device that prevents a fertilized egg
from implanting in the uterus,” like Plan B and Ella, “is not
an abortifacient.” (Oral Arg. at 37:13-37:45.) There was
something telling in that lecture, and not what counsel
intended. One might set aside the highly questionable
assertion that “abortifacient” is a “theological” and not a
scientific medical term, which must come as a surprise to the
editors of dictionaries that include entries like the following:
“abortifacient [MED] Any agent that induces abortion.”
McGraw-Hill Dictionary of Scientific and Technical Terms,
6th ed. (2003). And one could further ignore what appears to
be an ongoing debate on whether drugs like Ella are
technically abortifacients. (See Amicus Br. of Ass‟n of Am.
Physicians & Surgeons at 11 (arguing that “the low
pregnancy rate for women who take ella four or five days
after intercourse suggests that the drug must have an
„abortifacient‟ quality”); D.J. Harrison & J.G. Mitroka,
Defining Reality: The Potential Role of Pharmacists in
Assessing the Impact of Progesterone Receptor Modulators
and Misoprostol in Reproductive Health, 45 Annals
Pharmacotherapy 115, 116 (Jan. 2011) (cited in Ass‟n of Am.
Physicians & Surgeons et al. Amicus Br. at 10 n.15)
(concluding that, based on data, “it can be reasonably
expected that the [FDA-approved] dose of ulipristal [Ella]
will have an abortive effect on early pregnancy in humans”).)
Though the Hahns‟ objections to contraception may be more
intense as a zygote matures and implants, the point of this
case, after all, is not who among contending doctors and
scientists may be correct about the abortion-inducing qualities
4
Compl. ¶ 30, 32.) Conestoga, at the Hahns‟ direction, had
previously provided health insurance that omitted coverage
for contraception. (Am. Compl. ¶ 3.) Then came the Patient
of Ella or other drugs that the government wants to make the
Hahns and their business buy for employees through forced
insurance coverage. Whether a fertilized egg, being acted
upon by a drug or device, is aborted after implantation or is
never implanted at all is not pertinent to the Hahns‟ belief that
a human life comes into being at conception and therefore the
destruction of that entity is the taking of a human life. That
belief is the point of this case, and the government is in no
position to say anything meaningful about the Hahns‟
perspective on when life begins. But counsel‟s comment
during argument does say something meaningful about the
government‟s desire to avoid anything that might smack of
religion in this case involving questions of religious freedom.
The government evidently would like to drain the debate of
language that might indicate the depth of feeling the Hahns
have about what they are being coerced to do. “Keep the
conversation as dry and colorless as possible,” is the message.
Don‟t let anything that sounds like “abortion” come up, lest
the weight of that word disturb a happily bland consideration
of corporate veils and insurance contracts. Like it or not,
however, big issues – life and death, personal conscience,
religious devotion, the role of government, and liberty – are
in play here, and the government‟s effort to downplay the
stakes is of no help. It does, however, highlight the
continuing importance of the First Amendment, which “is an
effort, not entirely forlorn, to interpose a bulwark between the
prejudices of any official, legislator or judge and the stirrings
of the spirit.” EEOC v. Townley Eng’g & Mfg. Co., 859 F.2d
610, 624 (9th Cir. 1988) (Noonan, J., dissenting).
5
Protection and Affordable Care Act (the “ACA”) and related
regulations, and the Hahns‟ previous decisions about
employee benefits were no longer something the government
would tolerate. Under rules effectively written by an entity
called the “Institute of Medicine,”2 corporations like
Conestoga must purchase employee health insurance plans
2
To attribute the rules to government personnel is
unduly generous. As the Majority obliquely observes (see
Maj. Op. at 11), the rules in question here are not the product
of any legislative debate, with elected representatives
considering the political sensitivities and constitutional
ramifications of telling devout Mennonites to fund the
destruction of what they believe to be human lives. They are
not even the result of work within an administrative agency of
the United States. They are instead the result of the ACA
assigning regulatory authority to a subunit of the Department
of Health and Human Services (“HHS”) known as the Health
Resources and Services Administration, 42 U.S.C. § 300gg-
13(a)(4), which in turn turned the drafting over to the Institute
of Medicine. (See Maj. Op. at 11.) What the Majority does
not do is identify what the Institute of Medicine is. It is not
an agency of the United States government, or of any other
public entity. It is a private organization that, according to its
website, “works outside of government to provide unbiased
and authoritative advice to decision makers and the public.”
See About the IOM, http://www.iom.edu/About-IOM.aspx
(last visited July 25, 2013). That self-serving declaration of
its qualifications will not be of much comfort to those who
wonder how a private organization, not answerable to the
public, has ended up dictating regulations that the government
insists overrides the Appellants‟ constitutional rights to
religious liberty.
6
that include coverage for “[a]ll Food and Drug
Administration [(“FDA”)] approved contraceptive methods,
sterilization procedures, and patient education and
counseling” – including so-called emergency contraceptives
such as Plan B and Ella – “for all women with reproductive
capacity, as prescribed by a provider.” 77 Fed. Reg. 8725,
8725 (Feb. 15, 2012) (alterations in original) (internal
quotation marks omitted). This is what has been dubbed the
“contraception mandate” (the “Mandate”), and it brooks no
exception for those, like the Appellants, who believe that
supporting the use of certain contraceptives is morally
reprehensible and contrary to God‟s word. 3 If the Hahns fail
to have Conestoga submit to the offending regulations, the
company will be subject to a “regulatory tax” – a penalty or
fine – that will amount to about $95,000 per day and will
rapidly destroy the business and the 950 jobs that go with it. 4
3
There are plenty of other exceptions, however, as I
will discuss later. See infra Part III.A.2.b.i.
4
According to 26 U.S.C. § 4980D(a), “[t]here is … a
tax on any failure of a group health plan to meet the
requirements of chapter 100 (relating to group health plan
requirements).” The $95,000 estimate of the penalty takes
account only of Conestoga‟s 950 employees. The actual
penalty could amount to much more, given that the statute
subjects noncompliant companies to a $100 per-day penalty
for “any failure” to provide the mandated coverage “with
respect to each individual to whom such failure relates.” Id.
§ 4980D(b)(1). Presumably, “„individual‟ means each
individual insured” by the company, Hobby Lobby Stores,
Inc. v. Sebelius, __ F.3d __, 2013 WL 3216103, at *5 (10th
Cir. 2013) (en banc), including employees‟ family members.
Regardless, dead is dead, and Conestoga would as surely die
7
(See Maj. Op. at 13 (noting that “Conestoga is currently
complying with the Mandate”).)
Conestoga and the Hahns now argue that the Mandate
is forcing them, day by day, to either disobey their religious
convictions or to incur ruinous fines. That Hobson‟s choice,
they say, violates both the First Amendment and the
Religious Freedom Restoration Act of 1993 (“RFRA”), 42
U.S.C. § 2000bb-1. I agree.
II. Standard of Review
To qualify for preliminary injunctive relief, a litigant
must demonstrate “(1) a likelihood of success on the merits;
(2) that it will suffer irreparable harm if the injunction is
denied; (3) that granting preliminary relief will not result in
even greater harm to the nonmoving party; and (4) that the
public interest favors such relief.” Kos Pharm., Inc. v. Andrx
Corp., 369 F.3d 700, 708 (3d Cir. 2004). “We review the
denial of a preliminary injunction for an abuse of discretion,
an error of law, or a clear mistake in the consideration of
proof,” and “any determination that is a prerequisite to the
issuance of an injunction is reviewed according to the
a rapid death under the weight of $95,000 per-day fines as it
would under even higher fines.
In the alternative, Conestoga presumably could drop
employee health insurance altogether, and it would then face
a reduced fine of $2,000 per full-time employee per year
(totaling $1.9 million). See 26 U.S.C. § 4980H. Neither
party has briefed that option, and it is unclear what additional
consequences might follow from such action, including
upward pressure on wages, etc.
8
standard applicable to that particular determination.” Id.
(alterations and internal quotation marks omitted). We
therefore “exercise plenary review over the district court‟s
conclusions of law and its application of law to the facts … .”
Id. (internal quotation marks omitted). Highly relevant to this
case, “a court of appeals must reverse if the district court has
proceeded on the basis of an erroneous view of the applicable
law.” Id. (internal quotation marks omitted).
The Majority gives short shrift to the dispute over the
standard of review that emerged during the earlier appeal in
this case. My colleagues say simply that “[a] plaintiff‟s
failure to establish any element in its favor renders a
preliminary injunction inappropriate.” (Maj. Op. at 14
(quoting NutraSweet Co. v. Vit-Mar Enters., Inc., 176 F.3d
151, 153 (3d Cir. 1999)) (alteration in original) (internal
quotation marks omitted)). That may be true, but it fails to
address the problem that arose from the District Court‟s
erroneous application of a more rigid standard than our case
law requires. In explaining away the numerous decisions
around the country that have decided that the government
should be preliminarily enjoined from enforcing the Mandate,
the Court claimed that those other decisions were the result of
“a less rigorous standard” for the granting of preliminary
injunctive relief than the standard in this Circuit. Conestoga
Wood Specialties Corp., 2013 WL 140110, at *4. More
specifically, the Court said that those decisions “applied a
„sliding scale approach,‟ whereby an unusually strong
showing of one factor lessens a plaintiff‟s burden in
demonstrating a different factor.” 5 Id. It then contrasted that
5
See Korte v. Sebelius, No. 12-3841, 2012 WL
6757353, at *2 (7th Cir. Dec. 28, 2012) (noting that “[t]he
9
approach with what it characterized as this Court‟s approach,
saying, “the Third Circuit … has no such „sliding scale‟
standard, and Plaintiffs must show that all four factors favor
preliminary relief.” Id. The Majority hardly mentions the
District Court‟s mistaken belief that our standard is more
more the balance of harms tips in favor of an injunction, the
lighter the burden on the party seeking the injunction to
demonstrate that it will ultimately prevail,” and granting
preliminary injunction pending appeal); Grote v. Sebelius,
708 F.3d 850, 853 n.2 (7th Cir. 2013) (adopting the reasoning
of Korte and applying the same “sliding scale” standard);
Monaghan v. Sebelius, __ F. Supp. 2d __, 2012 WL 6738476,
at *3 (E.D. Mich. Dec. 30, 2012) (“Courts ... may grant a
preliminary injunction even where the plaintiff fails to show a
strong or substantial probability of success on the merits, but
where he at least shows serious questions going to the merits
and irreparable harm which decidedly outweighs any
potential harm to the defendant if the injunction is issued.”);
Am. Pulverizer Co. v. U.S. Dep’t of Health & Human Servs.,
No. 12-3459, 2012 WL 6951316, at *5 (W.D. Mo. Dec. 20,
2012) (applying a sliding scale standard and concluding that
“the balance of equities tip strongly in favor of injunctive
relief in this case and that Plaintiffs have raised questions
concerning their likelihood of success on the merits that are
so serious and difficult as to call for more deliberate
investigation”); Tyndale House Publishers, Inc. v. Sebelius,
904 F. Supp. 2d 106, 113 (D.D.C. 2012) (applying a sliding
scale standard by which, “[i]f the movant makes an unusually
strong showing on one of the factors, then it does not
necessarily have to make as strong a showing on another
factor” (alteration in original) (internal quotation marks
omitted)).
10
daunting than the standard employed by other courts, nor that
the District Court failed to apply binding precedent in which
we have adopted the functional equivalent of a sliding scale
standard.
It is true that we have not used the label “sliding scale”
to describe our standard for preliminary injunctions, as
numerous other circuit courts of appeals have.6 But we have
6
At least six circuits have explicitly adopted a “sliding
scale” approach for evaluating a motion for a preliminary
injunction. See McCormack v. Hiedeman, 694 F.3d 1004,
1016 n.7 (9th Cir. 2012) (“[T]he „sliding scale‟ approach to
preliminary injunctions remains valid: A preliminary
injunction is appropriate when a plaintiff demonstrates that
serious questions going to the merits were raised and the
balance of hardships tips sharply in the plaintiff‟s favor.”
(alteration and internal quotation marks omitted)); Davis v.
Pension Benefit Guar. Corp., 571 F.3d 1288, 1291-92 (D.C.
Cir. 2009) (“The four factors have typically been evaluated
on a „sliding scale.‟ If the movant makes an unusually strong
showing on one of the factors, then it does not necessarily
have to make as strong a showing on another factor.”); Cavel
Int’l, Inc. v. Madigan, 500 F.3d 544, 547 (7th Cir. 2007)
(endorsing a “„sliding scale‟ approach” pursuant to which “if
the appeal has some though not necessarily great merit, then
the showing of harm of … [great] magnitude … would justify
the granting of an injunction pending appeal provided … that
the defendant would not suffer substantial harm from the
granting of the injunction”); In re Microsoft Corp. Antitrust
Litig., 333 F.3d 517, 526 (4th Cir. 2003) (“In applying th[e]
four-factor test, the irreparable harm to the plaintiff and the
harm to the defendant are the two most important factors.
11
said that, “in a situation where factors of irreparable harm,
interests of third parties and public considerations strongly
favor the moving party, an injunction might be appropriate
even though plaintiffs did not demonstrate as strong a
likelihood of ultimate success as would generally be
required.” Constructors Ass’n of W. Pa. v. Kreps, 573 F.2d
811, 815 (3d Cir. 1978). On another occasion, we observed
that “[a]ll of [the four preliminary injunction] factors often
are weighed together in the final decision and the strength of
the plaintiff‟s showing with respect to one may affect what
will suffice with respect to another.” Marxe v. Jackson, 833
F.2d 1121, 1128 (3d Cir. 1987). And again, we have said,
“proper judgment entails a „delicate balancing‟ of all
elements.” Eli Lilly & Co. v. Premo Pharm. Labs., Inc., 630
F.2d 120, 136 (3d Cir. 1980) (quoting Kreps, 573 F.2d at 815)
Emphasis on the balance of these first two factors results in a
sliding scale that demands less of a showing of likelihood of
success on the merits when the balance of hardships weighs
strongly in favor of the plaintiff, and vice versa.” (alteration
and internal quotation marks omitted)); Gately v.
Commonwealth of Massachusetts, 2 F.3d 1221, 1232 (1st Cir.
1993) (noting “the general principle that irreparable harm is
subject to a sliding scale analysis, such that the showing of
irreparable harm required of a plaintiff increases in the
presence of factors … which cut against a court‟s traditional
authority to issue equitable relief”); Fla. Med. Ass’n, Inc. v.
U.S. Dep’t of Health, Educ. & Welfare, 601 F.2d 199, 203 n.2
(5th Cir. 1979) (when evaluating a motion for a preliminary
injunction, “a sliding scale can be employed, balancing the
hardships associated with the issuance or denial of a
preliminary injunction with the degree of likelihood of
success on the merits”).
12
(internal quotation marks omitted). 7 If those precedents are
not the expression and application of a sliding scale, allowing
7
As noted, see supra note 6, six circuits have used the
label “sliding scale” to describe their approach to reviewing
requests for preliminary injunctions. Almost all of the
remaining circuits have, like us, adopted an approach that, if
not in name, mirrors the so-called sliding scale approach. See
Lankford v. Sherman, 451 F.3d 496, 503 (8th Cir. 2006) (“No
single factor is dispositive, as the district court must balance
all factors to determine whether the injunction should
issue.”); Doe v. Sundquist, 106 F.3d 702, 707 (6th Cir. 1997)
(“We are mindful that even when a plaintiff‟s probability of
success on the merits of a claim is not very high, a
preliminary injunction may be appropriate if the plaintiff is in
serious danger of irreparable harm absent an injunction. Thus
we have observed that the degree of likelihood of success that
need be shown to support a preliminary injunction varies
inversely with the degree of injury the plaintiff might
suffer.”); Roso-Lino Beverage Distribs., Inc. v. Coca-Cola
Bottling Co. of N.Y., Inc., 749 F.2d 124, 125 (2d Cir. 1984)
(per curiam) (“In our circuit a preliminary injunction will be
issued when there is a showing of (a) irreparable harm and (b)
either (1) likelihood of success on the merits or (2)
sufficiently serious questions going to the merits to make
them a fair ground for litigation and a balance of hardships
tipping decidedly toward the party requesting the preliminary
relief.” (internal quotation marks omitted)); Otero Sav. &
Loan Ass’n v. Fed. Reserve Bank of Kansas City, Mo., 665
F.2d 275, 278 (10th Cir. 1981) (“The Tenth Circuit has
adopted the Second Circuit‟s liberal definition of the
„probability of success‟ requirement. When the other three
requirements for a preliminary injunction are satisfied, it will
13
the strength of a showing on one factor to compensate for a
weaker but still positive showing on another, I confess I do
not know what to make of them. The District Court ignored
the import of Kreps, Marxe, and Eli Lilly, despite our saying
that a party can succeed in gaining injunctive relief if the
threatened harm is particularly great and offsets a showing on
“likelihood of success” that is less than might ordinarily be
required. The Court thus erred, and we should say so.
Unlike the Majority, which tacitly endorses the District
Court‟s application of an incorrect and unduly restrictive
standard of review, I would apply the standard mandated by
our own case law and used in the vast majority of our sister
circuits.8
ordinarily be enough that the plaintiff has raised questions
going to the merits so serious, substantial, difficult and
doubtful, as to make them a fair ground for litigation and thus
for more deliberate investigation.” (internal quotation marks
omitted)).
Only one circuit appears to have rejected a balancing
approach outright. The Eleventh Circuit “has not recognized”
a sliding scale approach where there are “sufficiently serious
questions going to the merits [that] make them a fair ground
for litigation and [where there is] a balance of hardships
tipping decidedly toward the party requesting preliminary
relief.” Snook v. Trust Co. of Ga. Bank of Savannah, N.A.,
909 F.2d 480, 483 n.3 (11th Cir. 1990) (internal quotation
marks omitted).
8
I have discussed the correct standard of review at
length only to emphasize that, in view of the particularly
heavy and irreparable harm that the Hahns and Conestoga are
now suffering and will continue to suffer as a result of the
14
III. Discussion
The Majority, like the District Court, evaluates only
one of the four preliminary injunction factors: the likelihood
of the Hahns‟ and Conestoga‟s success on the merits.9
Holding that the “Appellants have failed to show that they are
Majority‟s holding, see infra Part III.B, this case clearly
meets the requirements for a preliminary injunction. But
even under the stricter standard applied by the District Court,
I would still hold, for the reasons I provide in the remainder
of this dissent, that the Hahns and Conestoga have made the
necessary showing. See Hobby Lobby, 2013 WL 3216103, at
*8 (“[W]e need not resolve whether this relaxed standard
would apply here, given that a majority of the court holds that
Hobby Lobby and Mardel have satisfied the likelihood-of-
success prong under the traditional standard.”).
9
The government has not asserted that the Anti-
Injunction Act, which precludes judicial consideration of suits
seeking to “restrain[] the assessment or collection of any
[federal] tax,” 26 U.S.C. § 7421(a), applies to this case. As a
result, that line of argument is waived. See Hobby Lobby,
2013 WL 3216103, at *35 (Gorsuch, J., concurring) (“[A]
waivable defense … is all the [Anti-Injunction Act]
provides.”). At any rate, I would hold with the en banc ruling
of the United States Court of Appeals for the Tenth Circuit
that the Anti-Injunction Act does not apply in a case like this.
See id. at *7 (“[The for-profit corporate appellants] are not
seeking to enjoin the collection of taxes or the execution of
any IRS regulation; they are seeking to enjoin the
enforcement, by whatever method, of one HHS regulation
that they claim violates their RFRA rights.”).
15
likely to succeed on the merits of their Free Exercise Clause
and RFRA claims,” the Majority “[does] not decide whether
Appellants have shown that they will suffer irreparable harm,
that granting preliminary relief will not result in even greater
harm to the Government, [or] that the public interest favors
the relief of a preliminary injunction.” (Maj. Op. at 29.) My
colleagues thereby avoid addressing, let alone weighing, the
additional factors. I believe that they are wrong about the
likelihood of success that both the Hahns and Conestoga
should be credited with, and I am further persuaded that the
remaining three factors, particularly the showing of
irreparable harm, weigh overwhelmingly in favor of relief, as
I will endeavor to explain.
A. Likelihood of Success on the Merits
This case is one of many filed against the government
in recent months by for-profit corporations and their owners
seeking protection from the Mandate. Conestoga Wood
Specialties Corp., 2013 WL 140110, at *5. So far, most of
those cases have reached the preliminary injunction stage
only, and a clear majority of courts has determined that
temporary injunctive relief is in order. 10 I join that consensus,
10
See Gilardi v. U.S. Dep’t of Health & Human Servs.,
No. 1:13-cv-00104-EGS, slip op. at 1 (D.C. Cir. Mar. 29,
2013) (granting on court‟s own motion injunction pending
appeal after first denying plaintiffs‟ motion on March 21,
2013); Annex Med., Inc. v. Sebelius, No. 13-1118, slip op. at 6
(8th Cir. Feb. 1, 2013) (granting injunction pending appeal);
Grote v. Sebelius, 708 F.3d 850, 855 (7th Cir. 2013) (same);
Korte, 2012 WL 6757353, at *2 (granting motion for
injunction pending appeal because appellants “have
16
established both a reasonable likelihood of success on the
merits and irreparable harm, and [because] the balance of
harms tips in their favor”); O’Brien v. U.S. Dep’t of Health &
Human Servs., No. 12-3357, slip op. at 1 (8th Cir. Nov. 28,
2012) (granting “[a]ppellants‟ motion for stay pending
appeal,” without further comment); Hobby Lobby Stores, Inc.
v. Sebelius, No. 5:12-cv-01000-HE, slip op. at 3 (W.D. Okla.
July 19, 2013) (enjoining government “from any effort to
apply or enforce, as to plaintiffs, the substantive requirements
imposed in 42 U.S.C. § 300gg-13(a)(4) and at issue in this
case, or the penalties related thereto”); Beckwith Elec. Co. v.
Sebelius, No. 8:13-cv-0648, 2013 WL 3297498, at *19 (M.D.
Fla. June 25, 2013) (holding that religious rights are “not
relinquished by efforts to engage in free enterprise under the
corporate form,” and granting motion for preliminary
injunction); Geneva Coll. v. Sebelius, No. 2:12-cv-00207,
2013 WL 3071481, at *12 (W.D. Pa. June 18, 2013) (granting
motion for preliminary injunction); Hartenbower v. U.S.
Dep’t of Health & Human Servs., No. 1:13-CV-02253 (N.D.
Ill. Apr. 18, 2013) (granting unopposed motion for
preliminary injunction); Hall v. Sebelius, No. 13-0295 (D.
Minn. Apr. 2, 2013) (granting unopposed motion for
preliminary injunction); Tonn & Blank Constr., LLC v.
Sebelius, No. 1:12-CV-325 (N.D. Ind. Apr. 1, 2013) (granting
unopposed motion for preliminary injunction); Bick Holding,
Inc. v. Sebelius, No. 4:13-cv-00462-AGF (E.D. Mo. Apr. 1,
2013) (granting unopposed motion for preliminary
injunction); Lindsay v. U.S. Dep’t of Health & Human Servs.,
No. 13-c-1210, slip op. at 1 (N.D. Ill. Mar. 20, 2013)
(preliminary injunction granted with “agreement of the
parties”); Monaghan v. Sebelius, __ F. Supp. 2d __, 2013 WL
1014026, at *11 (granting preliminary injunction because
17
“[t]he Government has failed to satisfy its burden of showing
that its actions were narrowly tailored to serve a compelling
interest,” and plaintiffs therefore “established at least some
likelihood of succeeding on the merits of their RFRA claim”);
Sioux Chief Mfg. Co. v. Sebelius, No. 13-0036, slip op. (W.D.
Mo. Feb. 28, 2013) (granting unopposed motion for
preliminary injunction); Triune Health Grp., Inc. v. U.S.
Dep’t of Health & Human Servs., No. 12-06756, slip op. at 1
(N.D. Ill. Jan. 3, 2013) (granting motion for preliminary
injunction); Sharpe Holdings, Inc. v. U.S. Dep’t of Health &
Human Servs., No. 2:12-CV-92-DDN, 2012 WL 6738489, at
*7 (E.D. Mo. Dec. 31, 2012) (holding that “plaintiffs are
entitled to injunctive relief that maintains the status quo until
the important relevant issues have been more fully heard”);
Am. Pulverizer, 2012 WL 6951316, at *5 (granting
preliminary injunction because “the balance of equities tip
strongly in favor of injunctive relief in this case and [because]
Plaintiffs have raised questions concerning their likelihood of
success on the merits that are so serious and difficult as to call
for more deliberate investigation”); Tyndale, 904 F. Supp. 2d
at 129 (granting preliminary injunction to publishing
corporation and its president because they had “shown a
strong likelihood of success on the merits of their RFRA
claim,” and because the other preliminary injunction factors
favored granting the motion); Legatus v. Sebelius, 901 F.
Supp. 2d 980, 999 (E.D. Mich. 2012) (granting preliminary
injunction to for-profit, family-owned and operated
corporation and holding that “[t]he harm in delaying the
implementation of a statute that may later be deemed
constitutional must yield to the risk presented here of
substantially infringing the sincere exercise of religious
beliefs”); Newland v. Sebelius, 881 F. Supp. 2d 1287, 1299
18
(D. Colo. 2012) (granting preliminary injunction, holding that
“[t]he balance of the equities tip strongly in favor of
injunctive relief in this case”). But see Eden Foods, Inc. v.
Sebelius, No. 13-1677, slip op. at 2 (6th Cir. June 28, 2013)
(denying injunction pending appeal and stating that it is “not
persuaded, at this stage of the proceedings, that a for-profit
corporation has rights under the RFRA” and that burden to
company‟s owner “is too attenuated”); Autocam Corp. v.
Sebelius, No. 12-2673, slip op. at 3 (6th Cir. Dec. 28, 2012)
(denying motion for injunction pending appeal); Mersino
Mgmt. Co. v. Sebelius, No. 13-cv-11296, slip op. at 2 (E.D.
Mich. July 11, 2013) (denying motion for preliminary
injunction); Armstrong v. Sebelius, No. 13-cv-00563 (D.
Colo. May 10, 2013) (denying motion for preliminary
injunction); MK Chambers Co. v. U.S. Dep’t of Health &
Human Servs., No. 13-11379, 2013 WL 1340719, at *7 (E.D.
Mich. Apr. 3, 2013) (denying request for a temporary
restraining order); Briscoe v. Sebelius, No. 13-00285, 2013
WL 755413, at *5 (D. Colo. Feb. 27, 2013) (relying on
recently overturned Hobby Lobby decisions to deny
temporary restraining order).
In addition to those cases, the Fourth Circuit recently
declined to rule on a challenge to the contraception Mandate
in a case remanded to it by the Supreme Court, because the
plaintiffs “did not challenge these regulations, or make any
argument related to contraception or abortifacients, in the
district court, in their first appeal … , or in their Supreme
Court briefs.” Liberty Univ., Inc. v. Lew, No. 10-2347, slip
op. at 58, __ F.3d __ (4th Cir. July 11, 2013).
The Sixth Circuit‟s order denying preliminary
injunctive relief in Autocam is of little persuasive value. In
its order, the court acknowledged “conflicting decisions,” but
19
and note also the recent en banc decision of the United States
Court of Appeals for the Tenth Circuit holding that two for-
profit companies had “established [that] they are likely to
succeed on their RFRA claim” and that the Mandate
threatened them with irreparable harm. 11 Hobby Lobby
Stores, Inc. v. Sebelius, __ F.3d __, 2013 WL 3216103, at *24
(10th Cir. June 27, 2013) (en banc).
it denied injunctive relief because the district court in that
case issued a “reasoned opinion” and because “the Supreme
Court[] [had] recent[ly] deni[ed] … an injunction pending
appeal in Hobby Lobby.” Autocam, No. 12-2673, slip op. at 2
(citing Hobby Lobby Stores, Inc. v. Sebelius, 133 S. Ct. 641(Dec. 26, 2012) (Sotomayor, J., as Circuit Justice). The
Supreme Court opinion the Autocam court referred to was an
in-chambers decision by Justice Sotomayor, acting alone,
denying the plaintiffs‟ motion for an injunction pending
appellate review. Hobby Lobby Stores, 133 S. Ct. 641. She
denied the motion under the particular standard for issuance
of an extraordinary writ by the Supreme Court, id. at 643,
which differs significantly from our standard for evaluating a
motion for a preliminary injunction. Under that more
demanding standard, the entitlement to relief must be
“„indisputably clear.‟” Id. (quoting Lux v. Rodrigues, 131 S.
Ct. 5, 6 (Sept. 30, 2010) (Roberts, C.J., as Circuit Justice)).
The Autocam court‟s reliance on her opinion is therefore
misplaced, and its decision is otherwise devoid of
explanation.
11
The Hobby Lobby court remanded the case for a
determination regarding the remaining two preliminary
injunction factors. Id. at *26.
20
To demonstrate a likelihood of success on the merits, a
“plaintiff need only prove a prima facie case, not a certainty
that he or she will win.” Highmark, Inc. v. UPMC Health
Plan, Inc., 276 F.3d 160, 173 (3d Cir. 2001). “[L]ikelihood
of success” means that a plaintiff has “a reasonable chance, or
probability, of winning.” Singer Mgmt. Consultants, Inc. v.
Milgram, 650 F.3d 223, 229 (3d Cir. 2011) (en banc). It
“does not mean more likely than not.” 12 Id. In the sense
pertinent here, the term “likelihood” embodies “[t]he quality
of offering a prospect of success,” or showing some promise.
Oxford English Dictionary, Vol. I, at 1625 (compact ed.,
1986) (emphasis added). The Appellants have shown the
requisite prospect of success.
1. Conestoga’s Right to Assert RFRA and
First Amendment Claims
I begin where the Majority begins and ends, with the
issue of Conestoga‟s claim to religious liberty.13 This may be
thought of as a question of standing, and, though it was not
couched that way in the briefing or argument before us, it has
been addressed as such by other courts. E.g., Hobby Lobby,
12
Indeed, because the showing necessary for an
injunction falls well below certainty, we have held that “this
„probability‟ ruling” is insufficient to establish that a party
has “prevail[ed]” based solely on its being awarded a
preliminary injunction. Milgram, 650 F.3d at 229.
13
As I am addressing the Majority‟s reasoning, I begin
with this point rather than the statutory question of whether
Conestoga is a “person” under RFRA. As I explain below,
see infra note 23, I believe that it is.
21
2013 WL 3216103, at *6; Tyndale House Publishers, Inc. v.
Sebelius, 904 F. Supp. 2d 106, 114-19 (D.D.C. 2012);
Legatus v. Sebelius, 901 F. Supp. 2d 980, 987-90 (E.D. Mich.
2012). However it may be framed, the government‟s
assertion and the Majority‟s conclusion that Conestoga lacks
any right to the free exercise of religion is flawed because the
Constitution nowhere makes the “for-profit versus non-profit”
distinction invented by the government, and the language and
logic of Supreme Court jurisprudence justify recognizing that
for-profit corporations like Conestoga are entitled to religious
liberty.
The Majority declares that there is no “history of
courts providing free exercise protection to corporations.”
(Maj. Op. at 20.) As my colleagues see it, “„[r]eligious belief
takes shape within the minds and hearts of individuals, and its
protection is one of the more uniquely human rights provided
by the Constitution‟” (id. at 20-21 (quoting Conestoga Wood
Specialties Corp., 2013 WL 140110, at *7)), so religion must
be “an inherently „human‟ right” that cannot be exercised by
a corporation like Conestoga (id. at 21). That reasoning fails
for several reasons. First, to the extent it depends on the
assertion that collective entities, including corporations, have
no religious rights, it is plainly wrong, as numerous Supreme
Court decisions have recognized the right of corporations to
enjoy the free exercise of religion. 14 See, e.g., Church of the
14
The Majority thinks it important that corporations
lack the anthropomorphic qualities of individual religious
devotion – “„[t]hey do not pray, worship, observe sacraments
or take other religiously-motivated actions separate and apart
from the intention and direction of their individual actors.‟”
(Maj. Op. at 21 (quoting Hobby Lobby Stores, Inc. v.
22
Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520,
525-26 (1993) (recognizing the petitioner as a corporation
whose congregants practiced the Santeria religion, and
concluding that city ordinances violated the corporation‟s and
its members‟ free exercise rights); Corp. of Presiding Bishop
of the Church of Jesus Christ of Latter-day Saints v. Amos,
Sebelius, 870 F. Supp. 2d 1278, 1291 (W.D. Okla. 2012),
rev’d en banc, No. 12-6294, 2013 WL 3216103 (10th Cir.
June 27, 2013)); see also id. (citing Hobby Lobby, 2013 WL
3216103, at *51 (Briscoe, C.J., concurring in part and
dissenting in part) (questioning “whether a corporation can
„believe‟ at all”)); id. at 21-22 (citing Citizens United v. Fed.
Election Comm’n, 558 U.S. 310, 466 (2010) (Stevens, J.,
concurring in part and dissenting in part) (“It might also be
added that corporations have no consciences, no beliefs, no
feelings, no thoughts, no desires.”)).) Of course, corporations
do not picket, or march on Capitol Hill, or canvas door-to-
door for moral causes either, but the Majority would not
claim that corporations do not have First Amendment rights
to free speech or to petition the government. Corporations
have those rights not because they have arms and legs but
because the people who form and operate them do, and we
are concerned in this case with people, even when they
operate through the particular form of association called a
corporation. See infra note 17. It is perhaps no accident that
the only support my colleagues put forward to show that a
corporation‟s lack of body parts deprives it of religious liberty
is a district court case that has been reversed, a dissent in a
court of appeals case, and a dissent in a Supreme Court case.
An argument that has lost three times is not necessarily wrong
for that record, but maybe the record says something about
the argument.
23
483 U.S. 327, 330 (1987) (recognizing the petitioner as a
corporation in a case concerning free exercise rights); Bob
Jones Univ. v. United States, 461 U.S. 574, 604 n.29 (1983)
(allowing two corporations that operated schools but could
not be characterized as “churches or other purely religious
institutions” to assert free exercise rights).
Taking the argument to be somewhat narrower, though
– that it is only for-profit corporations that are sealed off from
First Amendment religious liberty – it still fails. There is no
reason to suppose that a profit motive places a corporation
further away from what is “inherently human” than other
sorts of motives, so the distinction the Majority draws has no
intrinsic logic to recommend it. It also places far too much
weight on a supposed lack of precedent. While authority is
admittedly scanty, that is in all probability because there has
never before been a government policy that could be
perceived as intruding on religious liberty as aggressively as
the Mandate, so there has been little reason to address the
issue.15 And, in any event, there is an obvious counterpoint to
the Majority‟s observation: there may not be directly
supporting case law, but the “conclusory assertion that a
corporation has no constitutional right to free exercise of
religion is [also] unsupported by any cited authority.”
McClure v. Sports & Health Club, 370 N.W.2d 844, 850
15
The press reports are not in the record, but one
would have to have been cut off from all media to miss the
uproar created by the Mandate. See, e.g., Ethan Bronner, A
Flood of Suits Fights Coverage of Birth Control, New York
Times, Jan. 26, 2013, at A1 (describing “a high-stakes clash
between religious freedom and health care access that appears
headed to the Supreme Court”).
24
(Minn. 1985). In fact, it appears that, far from rejecting the
proposition that for-profit corporations may have religious
liberty interests, the Supreme Court has reserved the issue for
a later time. Cf. First Nat’l Bank of Boston v. Bellotti, 435
U.S. 765, 777 (1978) (declining to “address the abstract
question whether corporations have the full measure of rights
that individuals enjoy under the First Amendment”); Amos,
483 U.S. at 345 n.6 (Brennan, J., concurring in the judgment)
(noting that “[i]t is also conceivable that some for-profit
activities could have a religious character,” and leaving open
the issue of whether for-profit enterprises could have a
religious exemption from Title VII of the Civil Rights Act of
1964); id. at 349 (O‟Connor, J., concurring in the judgment)
(expressly leaving open the same question).
The Majority slips away from its own distinction
between for-profit and non-profit entities when it tries to
support its holding with a citation to the Supreme Court‟s
observation that the Free Exercise Clause “„secure[s]
religious liberty in the individual by prohibiting any invasions
thereof by civil authority.‟” (Maj. Op. at 20 (quoting Sch.
Dist. of Abington Twp. v. Schempp, 374 U.S. 203, 223 (1963))
(emphasis omitted).) If that out-of-context clause really
meant, as the Majority argues, that the right was limited to
individuals, then all groups would be left in the cold, not just
for-profit corporations. But that is manifestly not what the
quoted language means. Not only does the Majority‟s
interpretation fly in the face of the already cited authority
establishing that groups of people have free exercise rights as
surely as each individual does, it falters simply as a matter of
reason. To recognize that religious convictions are a matter
of individual experience cannot and does not refute the
collective character of much religious belief and observance.
25
Religious opinions and faith are in this respect akin to
political opinions and passions, which are held and exercised
both individually and collectively. “An individual‟s freedom
to speak, to worship, and to petition the government for the
redress of grievances could not be vigorously protected from
interference by the State unless a correlative freedom to
engage in group effort toward those ends were not also
guaranteed.” Roberts v. U.S. Jaycees, 468 U.S. 609, 622
(1984). And just as the Supreme Court has described the free
exercise of religion as an “individual” right, see Schempp,
374 U.S. at 223, it has previously said the same thing of the
freedom of speech, see Gitlow v. New York, 268 U.S. 652,
666 (1925) (calling freedom of speech a “fundamental
personal right[]”), and still, notwithstanding that occasional
characterization, there are a multitude of cases upholding the
free speech rights of corporations. E.g., Citizens United v.
Fed. Election Comm’n, 558 U.S. 310, 342 (2010)
(recognizing that “First Amendment protection extends to
corporations” and listing cases to that effect). Indeed, the
Supreme Court has specifically “rejected the argument that
political speech of corporations or other associations should
be treated differently under the First Amendment simply
because such associations are not „natural persons.‟” Id. at
343 (quoting Bellotti, 435 U.S. at 776). It thus does nothing
to advance the discussion to say that the Free Exercise Clause
secures religious liberty to individuals. Of course it does.
That does not mean that associations of individuals, including
corporations, lack free exercise rights.
I am not suggesting that corporations enjoy all of the
same constitutionally grounded rights as individuals do. They
do not, as the Supreme Court noted in First National Bank of
Boston v. Bellotti, saying, “[c]ertain purely personal
26
guarantees … are unavailable to corporations and other
organizations because the historic function of the particular
guarantee has been limited to the protection of individuals.”
435 U.S. at 778 n.14 (internal quotation marks omitted); see
Cal. Bankers Ass’n v. Shultz, 416 U.S. 21, 65-67 (1974)
(declining to extend to a corporation the right to privacy to
the same extent as individuals); Wilson v. United States, 221
U.S. 361, 382-86 (1911) (finding that the privilege against
self-incrimination does not apply to corporations). The
question in a case like this thus becomes “[w]hether or not a
particular guarantee is „purely personal.‟” Bellotti, 435 U.S.
at 778 n.14. And that, in turn, “depends on the nature,
history, and purpose of the particular constitutional
provision.” Id.Contrary to the Majority‟s conclusion, there is nothing
about the “nature, history, and purpose” of religious exercise
that limits it to individuals. Quite the opposite; believers have
from time immemorial sought strength in numbers. They lift
one another‟s faith and, through their combined efforts,
increase their capacity to meet the demands of their doctrine.
The use of the word “congregation” for religious groups
developed for a reason. Christians, for example, may rightly
understand the Lord‟s statement that, “where two or three are
gathered together in my name, there am I in the midst of
them,” Matt. 18:20, to be not only a promise of spiritual
outpouring but also an organizational directive. It thus cannot
be said that religious exercise is a purely personal right, one
that “cannot be utilized by or on behalf of any organization,
such as a corporation.” United States v. White, 322 U.S. 694,
699 (1944). It is exercised by organizations all the time.
27
Wait, says the government in response to such
reasoning; don‟t get carried away by facts; any collective
right to religious exercise must be limited to organizations
that are specifically and exclusively dedicated to religious
ends. As the government and the Majority see it, religious
rights are more limited than other kinds of First Amendment
rights. All groups can enjoy secular free expression and
rights to assembly, but only “religious organizations” have a
right to religious liberty. (See Appellee‟s Br. at 17
(“[W]hereas the First Amendment freedoms of speech and
association are „right[s] enjoyed by religious and secular
groups alike,‟ the First Amendment‟s Free Exercise Clause
„gives special solicitude to the rights of religious
organizations.‟” (quoting Hosanna-Tabor Evangelical
Lutheran Church & Sch. v. EEOC, 132 S. Ct. 694, 706, 713
(2012))); Maj. Op. at 18, 22 (acknowledging that “First
Amendment free speech rights apply to corporations,” but
declining to “draw the conclusion that, just because courts
have recognized the free exercise rights of churches and other
religious entities, it necessarily follows that for-profit, secular
corporations can exercise religion”).) Of course, that view
leaves it to the government to decide what qualifies as a
“religious organization,” which ought to give people serious
pause since one of the central purposes of the First
Amendment is to keep the government out of the sphere of
religion entirely. Cf. Illinois ex rel. McCollum v. Bd. of Educ.
of Sch. Dist. No. 71, 333 U.S. 203, 212 (1948) (“[T]he First
Amendment rests upon the premise that both religion and
government can best work to achieve their lofty aims if each
is left free from the other within its respective sphere.”).
Assuming, however, that the government had the
competence to decide who is religious enough to qualify as a
28
“religious organization,”16 there is no reason to suppose that
the Free Exercise guarantee is as limited as the government
16
Some wading into those waters has become
inevitable. A handful of federal statutes create exemptions
for “a religious corporation, association, educational
institution, or society.” 42 U.S.C. § 2000e-1(a) (Title VII);
see also id. § 12113(d)(1), (2) (similar language in the
Americans with Disabilities Act). In LeBoon v. Lancaster
Jewish Community Center Ass’n, 503 F.3d 217 (3d Cir.
2007), we examined whether a Jewish community center
qualified as a “religious organization” for purposes of Title
VII to determine whether it was exempt from compliance
with the religious discrimination provisions of Title VII‟s
Section 702. Under a multi-factor test, we determined that
the community center qualified as a “religious corporation,
organization, or institution,” because (1) “religious
organizations may engage in secular activities without
forfeiting protection under Section 702”; (2) “religious
organizations need not adhere absolutely to the strictest tenets
of their faiths to qualify for Section 702 protection”; (3)
“religious organizations may declare their intention not to
discriminate … without losing the protection of Section 702”;
and (4) “the organization need not enforce an across-the-
board policy of hiring only coreligionists.” Id. at 229-30.
In contrast to that rather broad view of whether an
organization qualifies for a religious exemption under Title
VII, the definition of the term “religious employer” in the
Mandate was notably cramped. See 45 C.F.R.
§ 147.130(a)(1)(iv)(B) (defining “religious employers” as
“organization[s] that meet[] all of the following criteria: (1)
The inculcation of religious values is the purpose of the
organization. (2) The organization primarily employs persons
29
claims or the Majority accepts. Our Constitution recognizes
the free exercise of religion as something in addition to other
kinds of expression, not because it requires less deference, but
arguably because it requires more. At the very least, it stands
on an equal footing with the other protections of the First
Amendment. See Prince v. Massachusetts, 321 U.S. 158, 164
(1944) (“[I]t may be doubted that any of the great liberties
insured by the First Article can be given higher place than the
others. All have preferred position in our basic scheme. All
are interwoven there together.”); Cantwell v. Connecticut,
310 U.S. 296, 310 (1940) (“[T]he people of this nation have
ordained in the light of history, that … these liberties
[religious faith and political belief] are, in the long view,
essential to enlightened opinion and right conduct on the part
of the citizens of a democracy. The essential characteristic of
these liberties is, that under their shield many types of life,
character, opinion and belief can develop unmolested and
unobstructed.”). The values protected by the religious
freedom clauses of the First Amendment “have been
zealously protected, sometimes even at the expense of other
interests of admittedly high social importance.” Wisconsin v.
Yoder, 406 U.S. 205, 214 (1972).
who share the religious tenets of the organization. (3) The
organization serves primarily persons who share the religious
tenets of the organization. (4) The organization is a nonprofit
organization as described in section 6033(a)(1) and section
6033(a)(3)(A)(i) or (iii) of the Internal Revenue Code of
1986, as amended.”). HHS recently promulgated a new rule
which purports to broaden the definition of “religious
employer” to some extent. See 78 F.R. 39870-01.
30
In spite of that history of zealous protection, the
Majority relegates religious liberty to second-class status,
saying that, because Supreme Court case law incorporated the
Free Exercise and Free Speech Clauses into the Fourteenth
Amendment‟s Due Process clause at different times, “it does
not automatically follow that all clauses of the First
Amendment must be interpreted identically.” (Maj. Op. at
24.) Implicit in the Majority‟s position is that the Free
Exercise Clause may be afforded less protection than the Free
Speech Clause, and that is indeed the effect of the Majority‟s
ruling. I wholeheartedly disagree with that inversion of the
special solicitude historically shown for the free exercise of
religion. And to any who might try to obfuscate what has
happened today by saying, “different doesn‟t mean worse,”
please note: courts in this Circuit and elsewhere have never
questioned the First Amendment rights of corporations
advancing abortion rights, Planned Parenthood of Se. Pa. v.
Casey, 947 F.2d 682, 705-06 (3d Cir. 1991) (considering
whether a statute requiring physicians to disclose certain
information to women seeking abortions violated the First
Amendment rights of Planned Parenthood, a corporation),
rev’d in part on other grounds, 505 U.S. 833 (1992); Planned
Parenthood Ass’n of Hidalgo Cnty. Tex., Inc. v. Suehs, 692
F.3d 343, 349 (5th Cir. 2012) (considering whether a state
“restriction on promoting elective abortions” violated Planned
Parenthood‟s First Amendment rights), while today‟s ruling
denies First Amendment protection to one opposed to
abortifacients, because that opposition is grounded in
religious conviction.
Given the special place the First Amendment plays in
our free society, the Supreme Court in Bellotti instructed that,
instead of focusing on “whether corporations „have‟ First
31
Amendment rights and, if so, whether they are coextensive
with those of natural persons,” “the question must be
whether” the activity at issue falls within an area “the First
Amendment was meant to protect.” 435 U.S. at 776. In other
words, the operative question under the First Amendment is
what is being done – whether there is an infringement on
speech or the exercise of religion – not on who is speaking or
exercising religion. Hence, in the political speech context
that it then faced, the Bellotti Court emphasized that, “[i]f the
speakers here were not corporations, no one would suggest
that the State could silence their proposed speech. It is the
type of speech indispensable to decisionmaking in a
democracy, and this is no less true because the speech comes
from a corporation rather than an individual.” Id. at 777.
Likewise here, the right to object on religious grounds to
funding someone else‟s reproductive choices is no less
legitimate because the objector is a corporation rather than an
individual.
But even if it were appropriate to ignore the Supreme
Court‟s advice and focus on the person asserting the right
rather than on the right at stake, there is a blindness to the
idea that an organization like a closely held corporation is
something other than the united voices of its individual
members. The Majority detects no irony in its adoption of
the District Court‟s comment that “„[r]eligious belief takes
shape within the minds and hearts of individuals, and its
protection is one of the more uniquely human rights provided
by the Constitution‟” (Maj. Op. at 20-21 (quoting Conestoga
Wood Specialties Corp., 213 WL 140110, at *7)), while it is
simultaneously denying religious liberty to Conestoga, an
entity that is nothing more than the common vision of five
individuals from one family who are of one heart and mind
32
about their religious belief.17 Acknowledging “the Hahns‟
commitment to the Mennonite faith” (id. at 30), on one hand,
while on the other acting as if the Hahns do not even exist and
are not having their “uniquely human rights” trampled on is
more than a little jarring.
And what is the rationale for this “I can‟t see you”
analysis? It is that for-profit corporations like Conestoga
were “created to make money.” (Id. at 21.) It is the profit-
making character of the corporation, not the corporate form
itself, that the Majority treats as decisively disqualifying
Conestoga from seeking the protections of the First
Amendment or RFRA. (See id. at 22 (“We will not draw the
conclusion that, just because courts have recognized the free
exercise rights of churches and other religious entities, it
necessarily follows that for-profit, secular corporations can
exercise religion.”).) That argument treats the line between
profit-motivated and non-profit entities as much brighter than
it actually is, since for-profit corporations pursue non-profit
goals on a regular basis. 18 More important for present
17
We are dealing here with a closely held corporation,
and we need not determine whether or how a publicly traded
corporation, with widely distributed ownership, might
endeavor to exercise religion. Those issues can be left for
another day.
18
It is commonplace for corporations to have mission
statements and credos that go beyond profit maximization.
When people speak of “good corporate citizens” they are
typically referring to community support and involvement,
among other things. Beyond that, recent developments in
corporate law regarding “Benefit” or “B” corporations
significantly undermine the narrow view that all for-profit
33
corporations are concerned with profit maximization alone.
As one academic has said, “[o]n a secular level, society
appears to have already recognized this, giving form to the
yearning of investors, customers, employees, and officers to
combine and form businesses consistent with their particular
values and convictions. This is evidenced by developments
both in the marketplace and in state legislatures, such as the
promulgation of „Benefit Corporation‟ statutes and the „B
Corporation‟ movement.” Ronald J. Colombo, The Naked
Private Square at 57-58, 51 Houston L. Rev. (forthcoming
2013), available at
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2173801
&download=yes; see also Margaret Blair, The Four
Functions of Corporate Personhood at 31, Public Law &
Legal Theory, Working Paper No. 12-15, available at
http://ssrn.com/abstract=2037356 (noting that corporations
“support the building, preserving, and sustaining of human
institutions. … [L]arge corporations nearly always have
broader purposes than just the enrichment of shareholders,
purposes such as providing safe and reliable products, good
jobs for employees, new treatments for diseases, investment
options for small investors, financing for housing or college,
or access to communication networks that link individuals
around the globe, make vast amounts of information available
to them, and give them an outlet for self-expression. While
investors in these institutions expect, and deserve, to get a
return on their investment, profits for shareholders are clearly
not the only value being created by such enterprises.”);
Christopher Lacovara, Strange Creatures: A Hybrid
Approach to Fiduciary Duty in Benefit Corporations, 2011
Colum. Bus. L. Rev. 815 (discussing “[b]enefit corporations,
or „B-Corps,‟ [which] represent a new corporate legal form
34
purposes, however, the kind of distinction the majority draws
between for-profit corporations and non-profit corporations
has been considered and expressly rejected in other First
Amendment cases.
In Citizens United v. Federal Election Commission, for
example, the Supreme Court said, “[b]y suppressing the
speech of manifold corporations, both for-profit and
nonprofit, the Government prevents their voices and
viewpoints from reaching the public and advising voters on
which persons or entities are hostile to their interests.” 558
U.S. at 354 (emphasis added); see also Perry v. Los Angeles
Police Dep’t, 121 F.3d 1365, 1371 (9th Cir. 1997) (“Once it
is decided that the activity here is expressive activity, fully
protected by the First Amendment, the fact that plaintiffs are
not nonprofit organizations does not affect the level of
protection accorded to their speech.”); Transp. Alts., Inc. v.
City of New York, 218 F. Supp. 2d 423, 444 (S.D.N.Y. 2002)
(“[D]rawing distinctions between organizations based on for-
profit or non-profit sponsorship in determining how much to
charge to hold an event [in a public park] runs afoul of the
First Amendment.”). Because the First Amendment protects
speech and religious activity generally, an entity‟s profit-
seeking motive is not sufficient to defeat its speech or free
exercise claims. See Hobby Lobby, 2013 WL 3216103, at
designed to accommodate the dual profit-making and public
benefit goals of the social enterprise movement”). There is
absolutely no evidence that Conestoga exists solely to make
money. It is operated, rather, to accomplish the specific
vision of its deeply religious owners. While making money is
part of that vision, the government has effectively conceded
that Conestoga has more than profit on its corporate agenda.
35
*15 (“We see no reason the Supreme Court would recognize
constitutional protection for a corporation‟s political
expression but not its religious expression.”).
The forceful dissent of Judge John T. Noonan, Jr., in
EEOC v. Townley Eng’g & Mfg. Co., 859 F.2d 610 (9th Cir.
1988), put the point plainly:
The First Amendment, guaranteeing the free
exercise of religion to every person within the
nation, is a guarantee that [for-profit
corporations may] rightly invoke[]. Nothing in
the broad sweep of the amendment puts
corporations outside its scope. Repeatedly and
successfully, corporations have appealed to the
protection the Religious Clauses afford or
authorize. Just as a corporation enjoys the right
of free speech guaranteed by the First
Amendment, so a corporation enjoys the right
guaranteed by the First Amendment to exercise
religion.
The First Amendment does not say that
only one kind of corporation enjoys this right.
The First Amendment does not say that only
religious corporations or only not-for-profit
corporations are protected. The First
Amendment does not authorize Congress to
pick and choose the persons or the entities or
the organizational forms that are free to exercise
their religion. All persons – and under our
Constitution all corporations are persons – are
free. A statute cannot subtract from their
freedom.
36
Id. at 623 (Noonan, J., dissenting) (internal citation omitted).
Oddly, the government‟s opposing view, adopted by
the Majority, appears to be itself a species of religion, based
on the idea that seeking after filthy lucre is sin enough to
deprive one of constitutional protection, and taking “[t]he
theological position … that human beings should worship
God on Sundays or some other chosen day and go about their
business without reference to God the rest of the time.” Id. at
625. There is certainly in the text of the Constitution no
support for this peculiar doctrine, and what precedent there is
on the role of religion in the world of commerce is to the
contrary. See United States v. Lee, 455 U.S. 252, 254 (1982)
(allowing Amish business owner to raise a free exercise
defense to his alleged failure to pay social security taxes for
his employees); Braunfeld v. Brown, 366 U.S. 599, 601
(1961) (allowing Jewish “merchants” in Philadelphia to
challenge the city‟s Sunday-closing laws because the laws
allegedly infringed on their free exercise of religion). As the
Tenth Circuit sitting en banc noted in Hobby Lobby, the
Supreme Court‟s decisions establish that Free Exercise rights
do not evaporate when one is involved in a for-profit
business. Hobby Lobby, 2013 WL 3216103, at *14 (citing
Lee and Braunfeld).19
19
The government emphasizes that, in Amos, “the
Supreme Court held that a gymnasium run by the Mormon
Church was free to discharge a building engineer who failed
to observe the Church‟s standards,” but that, in so doing, “the
Court stressed that the Church did not operate the gym on a
for-profit basis.” (Appellee‟s Br. at 18.) During oral
argument, counsel for the government relied on that
characterization of Amos to imply for the first time that
37
granting any free exercise rights to a for-profit corporation
would inevitably trigger Establishment Clause problems, as
any accommodation to the corporation would come at the
expense of similarly situated corporations that had not
received a religious exemption. As I have already noted, see
supra Part III.A.1, Amos did not turn on a for-profit versus
non-profit distinction, and, in fact, the Court left open any
question regarding the Establishment Clause impact of
granting a religious exemption to a for-profit corporation.
More fundamentally, the government mistakes the
scope of the Establishment Clause. Under the so-called
“endorsement” test for evaluating Establishment Clause
challenges, courts look to “whether the challenged
governmental practice either has the purpose or effect of
„endorsing‟ religion.” Cnty. of Allegheny v. ACLU, 492 U.S.
573, 592 (1989). “Of course, the word „endorsement‟ is not
self-defining,” id. at 593, but the Supreme Court “has long
recognized that the government may (and sometimes must)
accommodate religious practices and that it may do so
without violating the Establishment Clause,” Hobbie v.
Unemployment Appeals Comm’n of Fla., 480 U.S. 136, 144-
45 (1987); see also Lee v. Weisman, 505 U.S. 577, 627-28
(Souter, J., concurring) (arguing that government “may
„accommodate‟ the free exercise of religion by relieving
people from generally applicable rules that interfere with their
religious callings,” without “necessarily signify[ing] an
official endorsement of religious observance over disbelief”).
Otherwise, the enforcement of laws that “cut[] across
religious sensibilities, as [they] often do[],” would “put[]
those affected to the choice of taking sides between God and
government,” id., a choice that will often place a substantial
burden on religious devotion, see infra Part III.A.2.a. “In
38
So, to recap, it is not the corporate form itself that can
justify discriminating against Conestoga, and it is not the
pursuit of profits that can justify it. Yet somehow, by the
miracle-math employed by HHS and its lawyers, those two
negatives add up to a positive right in the government to
discriminate against a for-profit corporation. Thus, despite
the Supreme Court‟s insistence that “no official, high or petty,
such circumstances, accommodating religion reveals nothing
beyond a recognition that general rules can unnecessarily
offend the religious conscience when they offend the
conscience of secular society not at all.” Weisman, 505 U.S.
at 628. If the Supreme Court were of a contrary mind, then
Amos, Yoder, Sherbert, and a host of other cases in which the
Court granted exemptions under the Free Exercise Clause
would have been decided differently.
Thus, it cannot be, as the government seems to
suggest, that a decision to accommodate the Hahns‟ and
Conestoga‟s constitutionally protected religious liberties
would result in an impermissible endorsement of their
religion. The Establishment Clause does not prohibit what
the Free Exercise Clause demands. To be sure, the
government may, under certain circumstances, “cross[] the
line from permissible accommodation to unconstitutional
establishment.” Id. at 629 (concurring in majority holding
that school-mandated prayer at graduation ceremony violated
the Establishment Clause). But granting an exemption to
Conestoga and the Hahns in this case would do nothing more
than “lift a discernible burden on the[ir] free exercise of
religion,” id., and “Government efforts to accommodate
religion are permissible when they remove burdens on the
free exercise of religion,” Cnty. of Allegheny, 492 U.S. at 601
n.51.
39
can prescribe what shall be orthodox in politics, nationalism,
religion, or other matters of opinion or force citizens to
confess by word or act their faith therein,” W. Va. Bd. of
Educ. v. Barnette, 319 U.S. 624, 642 (1943), the government
claims the right to force Conestoga and its owners to facilitate
the purchase and use of contraceptive drugs and devices,
including abortifacients, all the while telling them that they
do not even have a basis to speak up in opposition.20
Remarkable.
I reject that power grab and would hold that Conestoga
may invoke the right to religious liberty on its own behalf.21
20
Conestoga is silenced because it is a for-profit
corporation, and the Hahns must likewise sit down and be
quiet because, by the government‟s reasoning, the Mandate
really does not affect them. (See Appellee‟s Br. at 22
(arguing that “[t]he contraceptive-coverage requirement does
not compel the [Hahns] as individuals to do anything,” but,
rather, “[i]t is only the legally separate corporation that has
any obligation under the mandate” (internal quotation marks
omitted) (third alteration in original)).)
21
Because of that conclusion, I need not consider at
length the alternative argument that, even if Conestoga itself
is without First Amendment protection, it may assert the free
exercise claims of its owners, the Hahns. Suffice it to say that
there is persuasive precedent for that approach in the context
of close corporations. See Commack Self-Serv. Kosher
Meats, Inc. v. Hooker, 680 F.3d 194, 200 (2d Cir. 2012)
(allowing a kosher deli to press Free Exercise and
Establishment Clause claims on behalf of its owners);
Stormans Inc. v. Selecky, 586 F.3d 1109, 1120 & 1120 n.9
40
(9th Cir. 2009) (“We have held that a corporation has
standing to assert the free exercise right of its owners. …
[A]n organization that asserts the free exercise rights of its
owners need not be primarily religious … .”); Townley, 859
F.2d at 620 n.15 (holding that “it is unnecessary to address
the abstract issue whether a for profit corporation has rights
under the Free Exercise Clause independent of those of its
shareholders and officers” because the corporation in question
“presents no rights of its own different from or greater than its
owners‟ rights,” and allowing the corporation “standing to
assert [its owners‟] Free Exercise rights”); Tyndale House
Publishers, Inc. v. Sebelius, 504 F. Supp. 2d 106, 116 (D.D.C.
2012) (“[T]he beliefs of Tyndale and its owners are
indistinguishable.”); Legatus v. Sebelius, 901 F. Supp. 2d
980, 988 (E.D. Mich. 2012) (“For the purposes of the pending
motion, however, Weingartz Supply Co. may exercise
standing in order to assert the free exercise rights of its
president, Daniel Weingartz, being identified as „his
company.‟”); State ex rel. McClure v. Sports & Health Club,
Inc., 370 N.W.2d 844, 850-51 (Minn. 1985) (holding that a
“conclusory assertion that a corporation has no constitutional
right to free exercise of religion is unsupported,” and
allowing a free exercise claim because the corporation‟s
owners “are the ones asserting the first amendment right to
the free exercise of religion”).
The Majority forecloses that line of argument, insisting
that, although “[t]he corporate form offers several advantages
„not the least of which was limitation of liability,‟ … the
shareholder must give up some prerogatives” in return (Maj.
Op. at 27), including, apparently, his religious convictions.
That conclusion rests on a mistaken idea that the business
purposes for which corporate law has developed and that
41
2. The Appellants’ RFRA Claim
Turning to the merits of the Appellants‟ RFRA claim, I
am satisfied that both Conestoga and the Hahns have shown a
likelihood of success. RFRA has been called the “most
important congressional action with respect to religion since
the First Congress proposed the First Amendment,” Douglas
Laycock & Oliver S. Thomas, Interpreting the Religious
Freedom Restoration Act, 73 Tex. L. Rev. 209, 243 (1994),
and it exists specifically to provide heightened protection to
the free exercise of religion. The statute was produced by an
“extraordinary ecumenical coalition in the Congress of
liberals and conservatives, Republicans and Democrats,
Northerners and Southerners, and in the country as a whole, a
very broad coalition of groups that have traditionally
defended … the various religious faiths … as well as those
who champion the cause of civil liberties.” Religious
Freedom Restoration Act of 1990: Hearing Before the
underpin the legal fiction of a corporation being separate from
its owners must mean that the people behind the corporate
veil are to be ignored for all purposes. That notion breezes
past the very specific business objectives for which the
corporate veil exists, namely, “to facilitate aggregations of
capital,” Entel v. Guilden, 223 F. Supp. 129, 131 (S.D.N.Y.
1963), and “to limit or eliminate the personal liability of
corporate principals,” Goldman v. Chapman, 844 N.Y.S.2d
126, 127 (N.Y. App. Div. 2007). Nothing in the history of
the important doctrine of a corporation‟s separate identity
justifies the limitation on civil rights that the Majority
endorses. See Hobby Lobby, 2013 WL 3216103, at *27
(Hartz, J., concurring) (“What does limiting financial risk
have to do with choosing to live a religious life?”).
42
Subcomm. On Civil & Constitutional Rights of the H. Comm.
on the Judiciary, 101st Cong. 13 (1991) (statement of Rep.
Solarz, chief sponsor of H.R. 5377).
Those diverse voices came together in response to the
Supreme Court‟s decision in Employment Division,
Department of Human Resources of Oregon v. Smith, 494
U.S. 872 (1990), in which, while upholding a law that banned
the use of peyote even for sacramental purposes, the Court
held that the First Amendment‟s Free Exercise Clause does
not require judges to engage in a case-by-case assessment of
the religious burdens imposed by facially constitutional laws.
Id. at 883-90. Congress quickly decried Smith as having
“virtually eliminated the requirement that the government
justify burdens on religious exercise imposed by laws neutral
toward religion.” 42 U.S.C. § 2000bb(a)(4). The stringent
standard of review imposed by RFRA on government action
reflects Congress‟s judgment that “governments should not
substantially burden religious exercise without compelling
justification.” Id. § 2000bb(a)(3). It is intended “to restore
the compelling interest test as set forth in Sherbert v. Verner,
374 U.S. 398 (1963) and Wisconsin v. Yoder, 406 U.S. 205(1972) … in all cases where free exercise of religion is
substantially burdened” by the Federal government, id.§ 2000bb(b)(1),22 and we are to look to pre-Smith free
22
Although the Supreme Court held RFRA
unconstitutional as applied to state and local governments
because it exceeded Congress‟ power under § 5 of the
Fourteenth Amendment, see City of Boerne v. Flores, 521
U.S. 507 (1997), it “continues to apply to the Federal
Government,” Sossamon v. Texas, __ U.S. __, 131 S. Ct.
1651, 1656 (2011).
43
exercise jurisprudence in assessing RFRA claims, see Vill. of
Bensenville v. FAA, 457 F.3d 52, 62 (D.C. Cir. 2006).
In short, RFRA restores the judicial standard of review
known as “strict scrutiny,” which is “the most demanding test
known to constitutional law.” City of Boerne v. Flores, 521
U.S. 507, 534 (1997). The statute prohibits the Federal
government from “substantially burden[ing] a person‟s
exercise of religion even if the burden results from a rule of
general applicability,” 23 id. § 2000bb-1(a), except when the
23
Having determined (erroneously) that corporations,
even closely held ones, do not enjoy religious liberty, the
Majority declined to “decide whether such a corporation is a
„person‟ under the RFRA.” (Maj. Op. at 28-29.) I believe
that it is. Although the statute itself does not define “person,”
the fallback definition section in the United States Code
provides that “unless the context indicates otherwise … the
word[] „person‟ … include[s] corporations, companies,
associations, firms, partnerships, societies, and joint stock
companies, as well as individuals … .” 1 U.S.C. § 1; see also
Mohamad v. Palestinian Auth., 132 S. Ct. 1702, 1707 (2012)
(explaining that the word “person” often includes
corporations, and that Congress and the Supreme Court often
use the word “individual” “to distinguish between a natural
person and a corporation”); Monell v. Dep’t of Soc. Servs.,
436 U.S. 658, 687 (1978) (“[B]y 1871, it was well understood
that corporations should be treated as natural persons for
virtually all purposes of constitutional and statutory
analysis.”). Given that corporations can assert religious
exercise claims, see supra Part III.A.1, the District Court
erred in concluding that “context indicates” that a for-profit
corporation is not a “person” for purposes of RFRA.
44
government can “demonstrat[e] that application of the burden
to the person – (1) is in furtherance of a compelling
governmental interest; and (2) is the least restrictive means of
furthering that compelling governmental interest,” id.
§ 2000bb-1. The term “exercise of religion” “includes any
exercise of religion, whether or not compelled by, or central
to, a system of religious belief.” Id. § 2000cc-5(7)(A),
incorporated by 42 U.S.C. § 2000bb-2(4). A person whose
religious practices are burdened in violation of RFRA “may
assert that violation as a claim or defense in a judicial
proceeding and obtain appropriate relief.” Id. § 2000bb-1(c).
a. Substantial Burden
Under RFRA, “a rule imposes a substantial burden on
the free exercise of religion if it prohibits a practice that is
both sincerely held by and rooted in the religious beliefs of
the party asserting the claim.” United States v. Ali, 682 F.3d
705, 710 (8th Cir. 2012) (internal quotation marks omitted).
Within the related context of the Religious Land Use and
Institutionalized Persons Act of 2000, a “substantial burden”
exists where: (1) “a follower is forced to choose between
following the precepts of his religion and forfeiting benefits
otherwise generally available to other [persons] versus
abandoning one of the precepts of his religion in order to
Conestoga Wood Specialties Corp., 2013 WL 140110, at *10.
See generally Hobby Lobby, 2013 WL 3216103, at *12
(“[T]he government has given us no persuasive reason to
think that Congress meant „person‟ in RFRA to mean
anything other than its default meaning in the Dictionary Act
– which includes corporations regardless of their profit-
making status.”).
45
receive a benefit”; or (2) “the government puts substantial
pressure on an adherent to substantially modify his behavior
and to violate his beliefs.” Washington v. Klem, 497 F.3d
272, 280 (3d Cir. 2007).
The substantial burden test derives from the Supreme
Court‟s decisions in Sherbert and Yoder. In Sherbert, the
Court held that a state‟s denial of unemployment benefits to a
Seventh-Day Adventist for refusing to work on Saturdays
substantially burdened the exercise of her religious belief
against working on Saturdays. The state law at issue in that
case
force[d] her to choose between following the
precepts of her religion and forfeiting benefits,
on the one hand, and abandoning one of the
precepts of her religion in order to accept work,
on the other hand. Governmental imposition of
such a choice puts the same kind of burden
upon the free exercise of religion as would a
fine imposed against appellant for her Saturday
worship.
Sherbert, 374 U.S. at 404. And in Yoder the Court held that a
compulsory school attendance law substantially burdened the
religious exercise of Amish parents who refused to send their
children to high school. The burden in Yoder was a fine of
between five and fifty dollars. The Court held that burden to
be “not only severe, but inescapable,” requiring the parents
“to perform acts undeniably at odds with fundamental tenets
of their religious belief.” Yoder, 406 U.S. at 218.
46
The District Court here failed to appreciate the
applicability of those precedents. It held, for two reasons,
that the burden imposed by the Mandate on Conestoga and
the Hahns was insubstantial. First, it said that Conestoga, as a
for-profit corporation, lacks religious rights and so can suffer
no burden on them, and, relatedly, that any harm to the
Hahns‟ religious liberty is “too attenuated to be substantial”
because it is Conestoga, not they, that must face the Mandate.
Conestoga Wood Specialties Corp., 2013 WL 140110, at *12;
see also id. at *14 (“Conestoga‟s corporate form … separates
the Hahns from the requirements of the ACA, as the
Women‟s Preventive Healthcare regulations apply only to
Conestoga, a secular corporation without free exercise rights,
not the Hahns. Whatever burden the Hahns may feel from
being involved with a for-profit corporation that provides
health insurance that could possibly be used to pay for
contraceptives, that burden is simply too indirect to be
considered substantial under the RFRA.”). That line of
argument is fallacious, for the reasons I have just discussed
and will not repeat. See supra Part III.A.1.
Relying on the recently reversed panel decision in
Hobby Lobby, the District Court‟s second line of argument
was that “the Hahns have not demonstrated that [the
Mandate] constitute[s] a substantial burden upon their
religion,” Conestoga Wood Specialties Corp., 2013 WL
140110, at *12, because “the ultimate and deeply private
choice to use an abortifacient contraceptive rests not with the
Hahns, but with Conestoga‟s employees,” id. at *13. As the
District Court saw it, “any burden imposed by the regulations
is too attenuated to be considered substantial” because “[a]
series of events must first occur before the actual use of an
abortifacient would come into play,” including that “the
47
payment for insurance [must be made] to a group health
insurance plan that will cover contraceptive services …; the
abortifacients must be made available to Conestoga
employees through a pharmacy or other healthcare facility;
and a decision must be made by a Conestoga employee and
her doctor, who may or may not choose to avail themselves to
these services.” Id. at *14. “Such an indirect and attenuated
relationship,” the Court held, “appears unlikely to establish
the necessary substantial burden.” Id. at *12 (quoting Hobby
Lobby, No. 12-6294, slip op. at 7, rev’d en banc, __ F.3d __,
2013 WL 3216103 (10th Cir. 2013)) (internal quotation
marks omitted).
The problem with that reasoning is that it
fundamentally misapprehends the substance of the Hahns‟
claim. As the Seventh Circuit rightly pointed out when
granting an injunction in the Mandate case before it, “[t]he
religious-liberty violation at issue here inheres in the coerced
coverage of contraception, abortifacients, sterilization, and
related services, not – or perhaps more precisely, not only – in
the later purchase or use of contraception or related services.”
Korte v. Sebelius, No. 12-3841, 2012 WL 6757353, at *3 (7th
Cir. Dec. 28, 2012); see also Tyndale House Publishers, Inc.
v. Sebelius, 904 F. Supp. 2d 106, 123 (D.D.C. 2012)
(“Because it is the coverage, not just the use, of the
contraceptives at issue to which the plaintiffs object, it is
irrelevant that the use of the contraceptives depends on the
independent decisions of third parties.”); Grote Indus., LLC v.
Sebelius, __ F. Supp. 2d __, 2012 WL 6725905, at *6 (S.D.
Ind. Dec. 27, 2012) (“We acknowledge that Plaintiffs object
not just to the use of contraceptives, but to the coverage
itself.”). In requiring them to provide the offending insurance
coverage, the Mandate requires the Hahns and Conestoga to
48
take direct actions that violate the tenets of their Mennonite
faith, with the threat of severe penalties for non-compliance.
They face the “inescapable choice” between facilitating the
provision of “drugs and services that they believe are immoral
(and thereby commit[ting] an immoral act),” or “suffer[ing]
severe penalties for non-compliance with the Mandate.”
(Appellants‟ Opening Br. at 26-27.) As explained in Sherbert
and Yoder, religious exercise is substantially burdened by a
law that puts substantial pressure on a person to commit an
act discouraged or forbidden by that person‟s faith, and the
Hahns‟ Mennonite faith forbids them not only from using
certain contraceptives, but from paying for others to use them
as well. Cf. United States v. Indianapolis Baptist Temple, 224
F.3d 627, 629 (7th Cir. 2000) (“The Free Exercise Clause …
provides considerable … protection for the ability to practice
(through the performance or non-performance of certain
actions) one‟s religion.”).
Even if Conestoga‟s and the Hahns‟ only religious
objection were the ultimate use of the offending
contraceptives by Conestoga employees, however, the fact
that the final decision on use involves a series of sub-
decisions does not render the burden on their religious
exercise insubstantial. Nothing in RFRA suggests that
indirect pressure cannot violate the statute. See 42 U.S.C.
§ 2000bb-1(a) (prohibiting not “direct” burdens, but
“substantial” ones). Indeed, even though a burden may be
characterized as “indirect,” “the Supreme Court has indicated
that indirectness is not a barrier to finding a substantial
burden.” Tyndale, 904 F. Supp. 2d at 123. The claimant in
Thomas v. Review Board of Indiana Employment Security
Division, 450 U.S. 707 (1981), quit his job because, based on
his religious beliefs, he could not work in a factory that
49
produced tank turrets. The state denied him unemployment
benefits and argued that his objection was unfounded because
he had been willing to work in a different factory that
produced materials that might be used for tanks. The
Supreme Court held that, in determining whether Thomas‟s
religious beliefs were burdened, it could not second-guess his
judgment about what connection to armament production was
unacceptably close for him: “Thomas drew a line, and it is not
for us to say that the line he drew was an unreasonable one.”
Id. at 715. “While the compulsion may be indirect,” the
Court reasoned, “the infringement upon free exercise is
nonetheless substantial.” Id. at 718. The Court further
instructed that “[c]ourts should not undertake to dissect
religious beliefs” when analyzing substantial burden
questions. Id. at 715. The Appellants here are entitled, just
as much as Thomas was, to make judgments about when their
connection with the acquisition and use of contraceptives
becomes close enough to contravene their faith.
Moreover, if the indirectness of the ultimate decision
to use contraceptives truly rendered insubstantial the harm to
an employer, then no exemptions to the Mandate would be
necessary. The harm to the Catholic Church by one of its
employees‟ decision to use an abortifacient would be equally
as indirect, and, by the District Court‟s logic, would pose
equally as insubstantial a burden on the Church‟s free
exercise rights. But the Mandate does provide an exemption
for so-called “religious employers,” see supra note 16, and
the regulation itself thus allows that an employee‟s choice
that only indirectly affects an employer can result in
substantial harm to the employer. 24
24
The same logic applies to the District Court‟s
50
It is true, as the Supreme Court cautioned in United
States v. Lee, that “every person cannot be shielded from all
the burdens incident to exercising every aspect of the right to
practice religious beliefs. When followers of a particular sect
enter into commercial activity as a matter of choice, the limits
they accept on their own conduct as a matter of conscience
and faith are not to be superimposed on the statutory schemes
which are binding on others in that activity.” 455 U.S. at 261.
But even in Lee, the Court held that the requirement to pay
Social Security taxes substantially burdened a for-profit
Amish employer‟s religious exercise. 25 The Court held that,
statement that there is no difference to employers if, on one
hand, their employees purchase contraceptives with salary or,
on the other, they obtain them free of charge through
company-provided health insurance. Conestoga Wood
Specialties Corp., 2013 WL 140110, at *13; see also
Autocam, No. 1:12-cv-1096, slip op. at 11 (noting that
plaintiffs will be “paying indirectly for the same services
through wages” that their employees may choose to use “for
contraception products and services”). If that were the case,
no exemptions would be required, even for religious
employers. In a free society, there is a world of difference
between paying money with no strings attached as
compensation for an employee‟s work and being forced to
fund insurance coverage that expressly provides for goods
and services believed to be morally reprehensible.
25
The Supreme Court in Lee did not use the phrase
“substantial burden,” but, since Lee, the Court has
consistently described its holding in that case as establishing
that the government may substantially burden religious
exercise only if it can show that the regulation in question
51
“[b]ecause the payment of the taxes or receipt of benefits
violates Amish religious beliefs, compulsory participation in
the social security system interferes with their free exercise
rights.” Id. at 257. Although the Court held that religious
adherents who enter the commercial marketplace do not have
an absolute right to receive a religious exemption from all
legal requirements that conflict with their faith, id. at 261, the
fact that the Court concluded that there was a substantial
burden and proceeded to apply strict scrutiny illustrates that
the government does not have carte blanche to substantially
burden the religious exercise of for-profit corporations and
their owners.
Thus, I would hold that the District Court erred in
concluding that the Mandate does not substantially burden
Conestoga‟s and the Hahns‟ free exercise of religion.
b. Strict Scrutiny
If government action “substantially burdens” religious
exercise, it will be upheld under RFRA only if it “is in
furtherance of a compelling governmental interest,” and “is
satisfies strict scrutiny – that is, that the regulation furthers a
compelling governmental interest in the least restrictive
means possible. In Hernandez v. Commissioner, 490 U.S.
680 (1989), for example, the Court described the holding in
Lee in the following manner: “[O]ur decision in Lee
establishes that even a substantial burden would be justified
by the „broad public interest in maintaining a sound tax
system,‟ free of „myriad exceptions flowing from a wide
variety of religious beliefs.‟” Id. at 699-700 (quoting Lee,
455 U.S. at 260) (emphasis added).
52
the least restrictive means” of accomplishing that interest. 42
U.S.C. § 2000bb-1. Neither the Majority nor the District
Court addressed that strict scrutiny test, because they
disposed of the case on other grounds. The Supreme Court
has said that strict scrutiny must not be “„strict in theory, but
fatal in fact.‟” Adarand Constructors, Inc. v. Pena, 515 U.S.
200, 237 (1995). And it has recently noted that “the opposite
is also true”: “[s]trict scrutiny must not be strict in theory but
feeble in fact.” Fisher v. Univ. of Texas at Austin, slip op. at
13, 570 U.S. __ (2013). Only the feeblest application of strict
scrutiny could result in upholding the Mandate on this record.
i. Compelling Interest
Compelling interests are those “of the highest order,”
Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah,
508 U.S. 520, 546 (1993), or “paramount interests,” Thomas
v. Collins, 323 U.S. 516, 530 (1945). The government
maintains that the Mandate advances two compelling
governmental interests: “public health and gender equality.”
(Appellee‟s Br. at 34.) In particular, it states that the “health
services at issue here relate to an interest – a woman‟s control
over her procreation – that is so compelling as to be
constitutionally protected from state interference.”
(Appellee‟s Br. at 34-35.)
Preserving public health and ending gender
discrimination are indeed of tremendous societal significance.
The government can certainly claim “a compelling interest in
safeguarding the public health by regulating the health care
and insurance markets.” Mead v. Holder, 766 F. Supp. 2d 16,
43 (D.D.C. 2011). And, as it is of undoubted “importance,
both to the individual and to society, [to] remov[e] the
53
barriers to economic advancement and political and social
integration that have historically plagued certain
disadvantaged groups, including women,” Roberts v. U.S.
Jaycees, 468 U.S. 609, 626 (1984), there is a compelling
interest in “[a]ssuring women equal access to … goods,
privileges, and advantages” enjoyed by men, id.Assuming for the sake of discussion that the Mandate
may actually advance those interests, it must nevertheless be
observed that the mere “invocation” of a “general interest in
promoting public health and safety [or, for that matter, gender
equality] … is not enough” under RFRA. Gonzales v. O
Centro Espirita Beneficente Uniao do Vegetal, 546 U.S. 418,
438 (2006). The government must show that the application
of the Mandate to the Hahns and Conestoga in particular
furthers those compelling interests. 42 U.S.C. § 2000bb-
1(b)(1); see Tyndale, 904 F. Supp. 2d at 125 (providing that
the government “must show that requiring [appellants] to
provide the contraceptives to which they object … will
further the government‟s compelling interests in promoting
public health and in providing women equal access to health
care”); see also O Centro, 546 U.S. at 430 (“RFRA requires
the Government to demonstrate that the compelling interest
test is satisfied through application of the challenged law „to
the person‟ – the particular claimant whose sincere exercise
of religion is being substantially burdened.” (quoting 42
U.S.C. § 2000bb-1(b))). Courts are required to “look[]
beyond broadly formulated interests justifying the general
applicability of government mandates and scrutinize[] the
asserted harm of granting specific exemptions to particular
religious claimants.” Id. at 431; see also Yoder, 406 U.S. at
236 (“[I]t was incumbent on the State to show with more
particularity how its admittedly strong interest in compulsory
54
education would be adversely affected by granting an
exemption to the Amish.”). The government must “offer[]
evidence that granting the requested religious
accommodations would seriously compromise its ability to
administer” its contraceptive Mandate. O Centro, 546 U.S. at
435. It has failed to do that.
The government‟s arguments against accommodating
the Hahns and Conestoga are “undermined by the existence of
numerous exemptions [it has already made] to the …
mandate.” Newland v. Sebelius, 881 F. Supp. 2d 1287, 1297
(D. Colo. 2012). By its own choice, the government has
exempted an enormous number of employers from the
Mandate, including “religious employers” who appear to
share the same religious objection as Conestoga and the
Hahns, leaving tens of millions of employees and their
55
families untouched by it.26 “[A] law cannot be regarded as
protecting an interest of the highest order when it leaves
26
The sheer number of employers exempted from the
Mandate distinguishes this case from United States v. Lee. In
that case, the Supreme Court held that, although the
“compulsory participation in the social security system
interfere[d] with [the plaintiff Amish employer‟s] free
exercise rights,” 455 U.S. at 257, the social security system
nonetheless satisfied strict scrutiny as applied to the Amish
employer, regardless of Congress‟s having exempted from
social security taxes “self-employed members of other
religious groups with similar beliefs,” id. at 255 (citation
omitted). As the Court described it, that provision exempted
only a “narrow category” of “[s]elf-employed persons” who
are members of “a religious community” that, like the Amish,
“ha[s] its own „welfare‟ system,” id. at 261, a small group to
say the least.
By way of comparison, the Supreme Court held in O
Centro that the government had failed to make a showing that
a ban on the use of a hallucinogenic substance served a
compelling interest as applied to a Native American tribe that
used the substance as part of its religious services. 546 U.S.
at 439. The Court relied heavily on similar religious
exemptions granted with respect to the use of peyote by
“hundreds of thousands” of members of the Native American
Church, and found that such broad exemptions weighed
heavily against finding a compelling interest. Id. at 433-34.
With respect to the Mandate, as a result of the multiple
and wide-reaching exemptions, millions of individuals –
perhaps upwards of 190 million, see Newland, 881 F. Supp.
2d at 1298 (“The government has exempted over 190 million
health plan participants … from the preventive care coverage
56
appreciable damage to that supposedly vital interest
unprohibited.” Church of the Lukumi Babalu Aye, 508 U.S.
at 547 (alteration and internal quotation marks omitted). So,
when the government‟s proffered compelling interest applies
equally to employers subject to a law and those exempt from
it, “it is difficult to see how [the] same findings [supporting
the government‟s interest] alone can preclude any
consideration of a similar exception” for a similarly situated
plaintiff. O Centro, 546 U.S. at 433; see also Republican
Party of Minn. v. White, 536 U.S. 765, 780 (2002) (noting
that the purpose of a law is undermined when it is “so
woefully underinclusive as to render belief in [its] purpose a
challenge to the credulous”). The Mandate is a classic
example of such arbitrary underinclusiveness. It cannot
legitimately be said to vindicate a compelling governmental
interest because the government has already exempted from
its reach grandfathered plans, employers with under 50
employees, and what it defines as “religious employers” (see
Maj. Op. at 12 n.4), thus voluntarily allowing millions upon
millions of people – by some estimates 190 million – to be
covered by insurance plans that do not satisfy the supposedly
vital interest of providing the public with free contraceptives.
See Geneva Coll. v. Sebelius, No. 12-cv-00207, 2013 WL
3071481, at *10 (W.D. Pa. June 18, 2013) (“In light of the
myriad exemptions to the mandate‟s requirements already
granted, the requirement is woefully underinclusive and
therefore does not serve a compelling government interest.”
(internal quotation marks omitted)).
mandate.”) – will fall outside the government‟s interest in
increasing access to contraceptives. This case is thus even
further removed than O Centro from the narrow exemption
involved in Lee.
57
ii. Least Restrictive Means
Nor can the government affirmatively establish that the
Mandate is the least restrictive means of advancing its
interests in health and gender equality. Statutes fail the “least
restrictive means” test when they are “overbroad” or
“underinclusive.” Church of the Lukumi Babalu Aye, 508
U.S. at 546. The underinclusiveness here is manifest, as just
described. Moreover, the least restrictive means test is aimed
at uncovering “the extent to which accommodation of the
[plaintiff] would impede the state‟s objectives,” and
“[w]hether the state has made this showing depends on a
comparison of the cost to the government of altering its
activity to allow the religious practice to continue unimpeded
versus the cost to the religious interest imposed by the
government activity.” S. Ridge Baptist Church v. Indus.
Comm’n, 911 F.2d 1203, 1206 (6th Cir. 1990) (internal
quotation marks omitted). If the government “has open to it a
less drastic way of satisfying its legitimate interests, it may
not choose a [regulatory] scheme that broadly stifles the
exercise of fundamental personal liberties.” Anderson v.
Celebrezze, 460 U.S. 780, 806 (1983) (internal quotation
marks omitted).
The Hahns and Conestoga argue that the government
could directly further its interest in providing greater access to
contraception without violating their religious exercise by, for
example,
(1) offer[ing] tax deductions or credits for the
purchase of contraceptive services; (2)
expand[ing] eligibility for already existing
58
federal programs that provide free
contraception; (3) allow[ing] citizens who pay
to use contraceptives to submit receipts to the
government for reimbursement; or (4)
provid[ing] incentives for pharmaceutical
companies that manufacture contraceptives to
provide such products to pharmacies, doctor‟s
offices, and health clinics free of charge.
(Appellants‟ Opening Br. at 51.) In response, the government
argues that the Appellants misunderstand the least-restrictive-
means test and that their proposed alternatives “would require
federal taxpayers to pay the cost of contraceptive services for
the employees of for-profit, secular companies.” (Appellees‟
Br. at 40.)
It is the government that evidently misunderstands the
test, for while the government need not address every
conceivable alternative, it “must refute the alternative
schemes offered by the challenger,” United States v. Wilgus,
638 F.3d 1274, 1288-89 (10th Cir. 2011),27 ultimately settling
on a policy that is “necessary” to achieving its compelling
goals, Fisher, slip op. at 10, 570 U.S. __. And it must seek
out religiously neutral alternatives before choosing policies
that impinge on religious liberty. Cf. Thompson v. W. States
Med. Ctr., 535 U.S. 357, 373 (2002) (“The Government
27
As the Tenth Circuit said in Wilgus, the government
need not “refute each and every conceivable alternative
regulation scheme.” Wilgus, 638 F.3d at 1289. But it “must
support its choice of regulation, and it must refute the
alternative schemes offered by the challenger” – “both
through the evidence presented in the record.” Id.59
simply has not provided sufficient justification here. If the
First Amendment means anything, it means that regulating
speech must be a last – not first – resort. Yet here it seems to
have been the first strategy the Government thought to try.”).
In those responsibilities, the government has utterly failed. It
has made no showing that any of the Appellants‟ alternative
ideas would be unworkable. Cf. Fisher, slip op. at 11, 570
U.S. __ (stating, in the context of racial preferences, that
“[t]he reviewing court must ultimately be satisfied that no
workable race-neutral alternatives would produce the …
benefits” sought). In fact, the government already provides
free contraception to some women, and there has been no
showing that increasing the distribution of it would not
achieve the government‟s goals. Because the government has
not refuted that it could satisfy its interests in the wider
distribution of contraception through any or all of the means
suggested by Conestoga and the Hahns, without burdening
their rights to religious liberty, the government has not shown
that the Mandate is the least restrictive means of addressing
those interests. It may be that the government‟s political
interests are better satisfied by forcing the Hahns to the
pharmacy counter than by trying to persuade voters to support
other means to fund free contraceptives, but political
expediency is not synonymous with “least restrictive means.”
Accordingly, the government has not met the burdens
of strict scrutiny, and I would hold that Conestoga and the
Hahns have established a likelihood of succeeding on the
merits of their RFRA claim.
3. The Appellants’ First Amendment Claim
Conestoga and the Hahns also bring a separate claim
60
under the First Amendment. As previously discussed, the
Supreme Court in Smith held that the Free Exercise Clause is
not implicated when the government burdens a person‟s
religious exercise through laws that are neutral and generally
applicable. 494 U.S. at 879. In contrast, “[a] law burdening
religious practice that is not neutral or not of general
application must undergo the most rigorous of scrutiny.”
Church of the Lukumi Babalu Aye, 508 U.S. at 546.
“Neutrality and general applicability are interrelated, and …
failure to satisfy one requirement is a likely indication that the
other has not been satisfied.” Id. at 531.
In my view, the Mandate is not generally applicable,
and it is not neutral. “A law fails the general applicability
requirement if it burdens a category of religiously motivated
conduct but exempts or does not reach a substantial category
of conduct that is not religiously motivated and that
undermines the purposes of the law to at least the same
degree as the covered conduct that is religiously motivated.”
Blackhawk v. Pennsylvania, 381 F.3d 202, 209 (3d Cir.
2004). Here, as already noted, the government has provided
numerous exemptions, large categories of which are unrelated
to religious objections, namely, the exemption for
grandfathered plans and the exemption for employers with
less than 50 employees. And it seems less than neutral to say
that some religiously motivated employers – the ones picked
by the government – are exempt while others are not. 28
Finally, it is utterly arbitrary to say that religious liberties
depend on whether a company hires 49 or 50 employees.
28
Because I have already discussed the “non-profit
versus for-profit” distinction at length, see supra Part III.A.1,
I will not repeat my reasons for rejecting it in this context.
61
Under the First Amendment, therefore, the Mandate is to be
subjected to strict scrutiny. As discussed above in relation to
the RFRA claim brought by Conestoga and the Hahns, see
supra Part III.A.2.b, the Mandate does not pass that daunting
test, and, accordingly, they have demonstrated a reasonable
likelihood of succeeding on their First Amendment claim.
B. Irreparable Harm
Focusing only on the question of likelihood of success
on the merits, neither the District Court nor the Majority
evaluated whether Conestoga and the Hahns have
demonstrated irreparable harm. It is a painful topic to
confront, as it brings to the fore the immediate and
unconscionable consequences of the government‟s
overreaching.
“Irreparable harm is injury for which a monetary
award cannot be adequate compensation.” Int’l Dairy Foods
Ass’n v. Amestoy, 92 F.3d 67, 71 (2d Cir. 1996) (internal
quotation marks omitted). “It is well-established that „[t]he
loss of First Amendment freedoms, for even minimal periods
of time, unquestionably constitutes irreparable injury.‟” Hohe
v. Casey, 868 F.2d 69, 72 (3d Cir. 1989) (quoting Elrod v.
Burns, 427 U.S. 347, 373 (1976)) (alteration in original). In
fact, “[w]hen an alleged deprivation of a constitutional right
is involved, most courts hold that no further showing of
irreparable injury is necessary.” 11A Charles Alan Wright,
Arthur R. Miller & Mary Kay Kane, Federal Practice and
Procedure § 2948.1 (2d ed. 1995). That principle applies
with equal force to a violation of RFRA because RFRA
enforces First Amendment freedoms. See Kikumura v.
Hurley, 242 F.3d 950, 963 (10th Cir. 2001) (“[C]ourts have
62
held that a plaintiff satisfies the irreparable harm analysis by
alleging a violation of RFRA.”); Jolly v. Coughlin, 76 F.3d
468, 482 (2d Cir. 1996) (“Courts have persuasively found that
irreparable harm accompanies a substantial burden on an
individual‟s rights to the free exercise of religion under
RFRA.” (citations omitted)). Threats to First Amendment
rights are often seen as so potentially harmful that they justify
a lower threshold of proof to show a likelihood of success on
the merits. Playboy Entm’t Grp., Inc. v. United States, 945 F.
Supp. 772, 783 (D. Del. 1996) (“In a case … in which the
alleged injury is a threat to First Amendment interests, the
finding of irreparable injury is often tied to the likelihood of
success on the merits.”), aff’d, 520 U.S. 1141 (1997).
Because the government demanded that the Hahns and
Conestoga capitulate before their appeal was even heard, 29
and because the District Court denied preliminary injunctive
relief, the severe hardship has begun. (See Maj. Op. at 13
(noting that “Conestoga is currently complying with the
Mandate”).) Faced with ruinous fines, the Hahns and
Conestoga are being forced to pay for the offending
29
Given the government‟s recent decision to delay the
implementation of other aspects of the ACA, see Zachary A.
Goldfarb & Sandhya Somashekhar, White House Delays
Health-Care Rule that Businesses Provide Insurance to
Workers, Washington Post, July 2, 2013, available at
http://www.washingtonpost.com/politics/white-house-delays-
health-care-rule-that-businesses-provide-insurance-to-
workers/2013/07/02/f87e7892-e360-11e2-aef3-
339619eab080_story.html, one wonders why it could not give
religious believers some breathing room during court
consideration of the Mandate.
63
contraceptives, including abortifacients, in violation of their
religious convictions, and every day that passes under those
conditions is a day in which irreparable harm is inflicted. See
Elrod, 427 U.S. at 373 (“The loss of First Amendment
freedoms, for even minimal periods of time, unquestionably
constitutes irreparable injury.”). The Majority‟s ruling
guarantees that grievous harm will go on and, as the days pile
up, worsen. See Conestoga Wood Specialties Corp. v. U.S.
Dep’t of Health & Human Servs., No. 13-1144, 2013 WL
1277419, at *6-*11 (3d Cir. Jan. 29, 2013) (Jordan, J.,
dissenting).
C. The Remaining Injunction Factors
Conestoga and the Hahns have also met the remaining
preliminary injunction factors. A preliminary injunction
would not result in greater harm to the government but would
merely restore the status quo between the parties. “One of the
goals of the preliminary injunction analysis is to maintain that
status quo, defined as the last, peaceable, noncontested status
of the parties.” Kos Pharm., Inc. v. Andrx Corp., 369 F.3d
700, 708 (3d Cir. 2004) (alteration and internal quotation
marks omitted). The last uncontested status between the
parties was prior to January 1, 2013, the date the Mandate
became effective against the Appellants. “Granting an
injunction would restore that state of affairs.” Opticians
Ass’n of Am. v. Indep. Opticians of Am., 920 F.2d 187, 197
(3d Cir. 1990). Moreover, the harm to Conestoga and the
Hahns caused by the denial of the preliminary injunction
vastly outweighs the harm to the government were an
injunction to be granted. Again, any infringement on a
person‟s First Amendment rights – even if only for a short
time – constitutes irreparable injury. See Elrod, 427 U.S. at
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373. Although a preliminary injunction in this case might
“temporarily interfere[] with the government‟s goal of
increasing cost-free access to contraception and sterilization,”
that interest “is outweighed by the harm to the substantial
religious-liberty interests on the other side.” Korte v.
Sebelius, No. 12-3841, 2012 WL 6757353, at *5 (7th Cir.
Dec. 28, 2013); see also Monaghan v. Sebelius, __ F. Supp.
2d __, 2012 WL 6738476, at *8 (E.D. Mich. Dec. 30, 2012)
(“The harm of delaying the implementation of a statute that
may later be deemed constitutional is outweighed by the risk
of substantially burdening the free exercise of religion.”).
In addition, a preliminary injunction would not harm
the public interest. On the contrary, “[a]s a practical matter,
if a plaintiff demonstrates both a likelihood of success on the
merits and irreparable injury, it almost always will be the case
that the public interest will favor the plaintiff.” Am. Tel. &
Tel. Co. v. Winback & Conserve Program, Inc., 42 F.3d 1421,
1427 n.8 (3d Cir. 1994). And “[t]he public as a whole has a
significant interest in ensuring … [the] protection of First
Amendment liberties.” Jones v. Caruso, 569 F.3d 258, 278
(6th Cir. 2009). An injunction would simply put Conestoga‟s
employees in the same position as the tens of millions of
employees and their families whose employers have already
been exempted from the Mandate.
IV. Conclusion
This is a controversial and, in some ways, complex
case, but in the final analysis it should not be hard for us to
join the many courts across the country that have looked at
the Mandate and its implementation and concluded that the
government should be enjoined from telling sincere believers
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in the sanctity of life to put their consciences aside and
support other people‟s reproductive choices. The District
Court‟s ruling should be reversed and a preliminary
injunction should issue.
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