Essay

The Good News According to Hobby Lobby

By | July 2, 2014

(Getty/Bloomberg)

(Getty/Bloomberg)

On June 30, the world did not end. For all the drama and hype that the Hobby Lobby case has generated, the Supreme Court decision was modest and quite narrow, as widely predicted by Court watchers. The central question was whether the Religious Freedom Restoration Act (RFRA) protected for-profit corporations from complying with the so-called contraceptive mandate under the Affordable Care Act on grounds that it was a violation of their religious beliefs. The Court’s 5-4 majority opinion, led by Justice Samuel Alito, said yes. As a result, the religious exemption claims of Hobby Lobby’s owners are evaluated by a test including a least restrictive means prong which the mandate failed to satisfy. That means the owners are exempted from having to pay for health insurance coverage for the four contraceptives they challenged. In solomonic fashion, the burden instead is passed on to either the government, or in the interest of efficiency, to the private insurer which would have to provide separate payments for the contraceptive services that are required to be covered, all without imposing any additional costs on the affected employees.

Let me clarify at the outset what the Court did and did not say. The Court did acknowledge that women’s health is a compelling and legitimate government interest, one that Justice Kennedy took care to also point out in his brief concurring opinion. It did interpret RFRA’s definition of persons to include for-profit corporations, but limited it to closely-held corporations. It also noted that the protection is not for the organization per se but for the actual humans associated with the corporation. Lastly, in order to address slippery slope concerns, the Court explicitly stated that the exemption only covers contraception, and does not include exemptions from immunizations or illegal hiring discrimination.

The Court did not say anything definitive on a possible scenario involving a for-profit and publicly traded corporation. Justice Alito wrote that “it seems unlikely that the sort of corporate giants … will often assert RFRA claims.” It also did not say anything about other possible government interests such as vaccinations, explicitly bracketing them out. In fact, it did not say anything beyond the contraception coverage scenario. The decision was contingent on several facts unique to the implementation of the Affordable Care Act (ACA). As a result, for those situations involving religious business owners refusing to photograph same-sex weddings or to bake wedding cakes for LGBT couples, which are now the rage in lower courts, there is not much in this decision to draw on.

And yet, the dissent, written by Justice Ruth Bader Ginsburg and joined by Justices Sotomayor, Kagan, and Breyer, dramatically describes the opinion of the Court as a “minefield.” Why is that? There are three main reasons. First, the corporate personhood issue—the issue that has attracted the most vitriol in mainstream media, thanks to the negative fallout from Citizens United—is a major point of contention.It is easy to caricature corporate claims to free exercise of religion, and the Court did not help its cause by analogizing free exercise to the right against government seizure of property without just compensation. Because it has a separate legal personality, a corporation as corporation could own property. By contrast, it is more difficult to argue how the same corporation could “exercise” religion. In this case, however, because of the corporate form involved and the particular circumstances surrounding Hobby Lobby Inc. and its owners, it was easier to factually substantiate the claim that the corporation was a mere extension of its owners, a fact that even Justice Sotomayor has acknowledged when she joked that the government has picked “great plaintiffs” during oral arguments. It should be noted that Justices Kagan and Breyer did not join the dissent in this part, presumably preserving a possibility that some for-profit corporations might be entitled to claim religious freedom protection.

The majority declared that the fact that a business has decided to incorporate itself and that it seeks profit should not preclude it from claiming RFRA protection. Moreover, it states for-profit corporations could easily further religious aims as a religious nonprofit. The dissent, however, drew a line between nonprofit religious organizations (as churches and nonprofits are arguably corporations in their own right) and commercial corporations, stating that furthering the religious aims are a core feature of religious organizations, but not so for profit-seeking entities. Another main difference is that religious organizations consist mostly of people belonging to the same religious faith while for-profit corporations mostly employ people of diverse beliefs.

The argument, however, that the Court has never recognized for-profit corporate claims is not an argument against barring an exemption. True, this decision opens the door for all sorts of companies, including publicly traded ones, to make claims, but the question as to what kinds of claims would actually be allowed would rest on a particular set of facts and arguments that the ruling is ill-equipped to predict. The ACA, and health care for that matter, is quite unique in this respect, as it should not matter where the coverage comes from as long as women employees get the contraceptives they need. Such a least restrictive means could not be as easily available in other cases, despite doomsday predictions to the contrary.

Second, the slippery slope concern of never-ending exemptions was a specter all over the ruling. The majority took pains to make an explicit statement that the ruling only covered contraceptives, but the dissent nonetheless enumerated religious objections to blood transfusions, antidepressants, and medications obtained from animals, as well as religious beliefs to commit discriminatory hiring, as cases where RFRA exemptions could possibly apply. The fact that there is no legal bulwark against such possibilities is an argument against RFRA itself, not the decision. Again, the Court’s analysis in the case seems tethered to the contraception scenario; other situations would involve a different set of arguments and analysis. If the concern is that it results in an unfair burden, exemptions always impose costs, both tangible and intangible. For example, outside the health care context, taxpayers shoulder extra burdens all the time in accommodating the religious claims of federal prisoners.

Finally, the dissent is concerned that an expansive but quite uncertain view of RFRA gives all sorts of opportunities for courts to start adjudicating which claims are entitled to religious exemptions, which runs the risk that it will favor certain religions over others. To avoid this situation, Justice Ginsburg would have RFRA cover only organizations formed for explicitly religious purposes and which engage only in religious activities. Such a solution is attractive for its simplicity, but in the end it would deny all religious freedom claims. Religious exemptions always toe the fine line between accommodation and impermissible government endorsement.

Having written all of this, what could possibly be the good news? Apart from the fact that it could have been worse, as the dissent already noted, the ruling does not offer any guidance for courts bound by today’s decision. That indeterminacy might just be a feature, not a flaw.

Here’s a bit of a necessary backstory. Until 1990, when the Supreme Court decided a case called Employment Division v. Smith, religious believers had a right to exemptions from general laws that had the incidental effect of burdening their conscience, unless the government could show a compelling interest. All they had to do was show that the government regulation substantially burdened their exercise of religion, and the Court would balance this against the compelling interest of the government. Smith, which upheld the firing of two Native American users of the hallucinogen peyote in sacred ceremonies for violation of federal drug laws, turned things around. Smith held that the government is not required to grant any religious exemptions from a neutral, generally applicable law. The bipartisan outrage and popular backlash that followed the Smith decision prompted Congress to enact RFRA, which aimed to restore the pre-Smith state of things, the very same RFRA that many are now deploring. RFRA would undergo several legal challenges in the subsequent years, but remains applicable against the federal government.

The decade-long saga which saw the court and the political branches, particularly Congress, struggle over what free exercise means in the aftermath of Smith saw a broad constitutional conversation in which courts were not the only major players. Private groups and individual citizens, Congress, and the courts all meaningfully took part in the social construction of what religious freedom means. A limited role for the courts should be welcomed. As the religious makeup of American society substantively changes, so too will the kinds of conversations we have. And such conversations should largely occur as spirited exchanges in the political arena, not imposed top-down as bright-line rules by the Supreme Court. Perhaps this should prompt a reflection on whether we still want to keep RFRA on the books.At the very least what Hobby Lobby does, less final in its form when compared to Smith, is to keep the conversation going.

In the short twenty or so years since Smith, we have come to Hobby Lobby. It is hard to tell what Hobby Lobby portends for the future, but at the moment, it gave something to everyone. Women employees would get access to contraceptives, whether through the government or a private plan, and religious owners would get their exemptions. But this apparent symbolic victory for religious entities could also easily turn into something else. Shortly after the decision, the White House has already urged Congress to take action to assist the women who will be affected by the decision. And although the current political climate might make legislative solutions a farfetched goal, other factors could weigh in. As religious liberty litigation exponentially increases from here forward, lower courts may be inclined to level the playing field and become more reluctant to grant exemptions to both for-profit and nonprofit organizations.

A ruling that seemingly equates Wal-Mart with the Roman Catholic Church understandably generates widespread apprehension. People can avoid churches; they cannot avoid commercial entities as easily. And that feeling is perhaps the root of most of the opposition to this case. There is something inherently appealing and egalitarian about an impersonal corporation that does not arise from or recognize any creed. But at the same time, a commitment to religious liberty should allow, as much as possible if it is to mean anything, for citizens to channel their deeply-held beliefs into whatever venue they find meaningful, including in their economic pursuits.

The core questions at the heart of Hobby Lobby are difficult ones. In an imperfect manner, the Court has sought a middle way that would accommodate competing claims of religious liberty and access to essential health care without the far-ranging pronouncements that many feared. To be fair, the decision could easily spur an avalanche of challenges that would make it harder for women to obtain contraceptives, but until litigation happens, it is hard to accurately predict the precise fallout.

At least for now, the decision should signal that our liberal democratic society has space for various visions of economic life, and ultimately, for a religious freedom that does not end at the church doors.

Anna Su is incoming assistant professor of law at the University of Toronto. Her forthcoming book, to be published from Harvard University Press, is Exporting Freedom: Religious Liberty and American Power.

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