U.S. Sixth Circuit - The FindLaw 6th Circuit Court of Appeals Opinion Summaries Blog

6th Cir. Holds That Employer Must Provide Contraception

Okay, there's almost no way this doesn't get to the Supreme Court.

The Patient Protection and Affordable Care Act (PPACA, also known as ACA or Obamacare) requires health plans to cover contraception, sans co-pay. Employers with religious owners argue that this infringes upon their religious liberty. According to the ACLU, 72 cases have been filed nationwide challenging the "mandate."

Here, we have Autocam, an automotive and medical manufacturer, whose owners, the Kennedys, are Catholic, opposed to birth control on religious grounds, and who believe that some of the drugs covered by the mandate are abortifacients.

Parallel Paths to SCOTUS

In case you've missed the other recent circuit court decisions, in identical cases, the Tenth Circuit sided with Hobby Lobby's religious freedom claims, while the Third Circuit sided with the government. Circuit splits, plus a matter of national importance, that is the subject of nationwide litigation, all should push SCOTUS to grant certiorari in the ensuing appeals, though, of course, their jurisdiction is wholly discretionary.

Shareholders' Individual Religious Rights Irrelevant

The Kennedy family, the owners of the company, brought suit under the Religious Freedom Restoration Act, 42 U.S.C. §§ 2000bb, the same statute considered by the Sixth and Third Circuits. Their argument, to put it simply, is that requiring their closely-held, self-insured company to purchase contraception (including alleged abortion-causing drugs) would violate their religious beliefs, and if they refuse, they'll face $19 million dollars in fines.

Alas, their beliefs are not those of the corporation. "[I]ncorporation'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 it, who own it, or whom it employs." The Kennedys' actions with respect to the company are as corporate officers with fiduciary duties to the company. The only rights at issue in this case are the rights of the company itself.

After dismissing the Kennedys' individual claims on standing, the court then addressed the rights of the corporation under the RFRA.

Corporation Cannot Engage in Religious "Exercise"

There, our friends, is the circuit split. The RFRA affords a cause of action to any "person whose religious exercise has been burdened."

The Tenth Circuit held that "as a matter of statutory interpretation . . . Congress did not exclude for-profit corporations from RFRA's protections. This is the classic corporations are people, in the legal sense, argument. Conversely, the Third Circuit held that, "Since [a for-profit, secular corporation] cannot exercise religion, it cannot assert a RFRA claim."

As for the Sixth, they sided with the Third Circuit, holding that "Autocam is not a 'person' capable of 'religious exercise' as intended by RFRA. The RFRA was passed in response to Yoder and Sherbert, two cases involving restrictions on individuals' religious rights. The court also notes that there is no pre-Obamacare case law demonstrating that a corporation has religious rights.

One final note: the court notes that the Dictionary Act, which provides default definitions for the entire U.S. Code, defines "person" to include corporations, unless the context or text of the statute clearly indicates otherwise. The RFRA doesn't define "person," so the court relies on context and legislative history to support its interpretation. We all know how much certain Justices hate the use of legislative history.

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