Monday, June 30, 2014
From Anne Tucker (who is off filming academic videos this afternon--whatever that means!):
Today’s Supreme Court decision in Burwell v. Hobby Lobby Stores Inc. et al. exempted closely held corporations from complying with the contraceptive mandate in the Affordable Care Act. There is plenty to debate about the opinion—corporations are persons under RFRA and can exercise religion as well as a host of choice quotes from the SCOTUS about “modern corporate law”—and I will leave that fun for another time. I want to highlight three initial reactions:
- There is no definition of closely held in today’s opinion. Will we draw lines based on state corporate codes and elections to be S corp? Will we rely upon the IRS definition of a closely held company? It is unclear. There is NOTHING in the opinion that prevents today’s ruling from applying to publically traded, closely held corporations like Wal-Mart. The line drawing engaged by the SCOTUS in Hobby Lobby is not such a neatly drawn, tight circle, but is a wide net. I discussed this briefly in a HuffPost Live segment earlier today—here.
- This is a statutory, not a constitutional ruling. On its face. Of course Congress could amend RFRA and exclude corporations, but there are exactly zero people holding out hope for that solution, at least in our present climate. The language of the opinion, however, gives strong dicta supporting religious rights and identities of corporations, whether for profit or not. [“Any suggestion that for-profit corporations are incapable of exercising religion because their purpose is simply to make money flies in the face of modern corporate law.”]
- Today, the Court weighed in on the moral dilemma of performing an “innocent” act (i.e., providing health care coverage) that enables an “immoral” act (i.e., using an IUD whether for family planning or medical reasons). May companies object to coverage that includes screening for sexually transmitted diseases because unwed employees may use it ensure safe, premarital sex? The answer would seem to be yes. Of course, we can imagine that the Court would find a compelling interest here like they did with contraceptives, but what about the least restrictive means? In Hobby Lobby, the Court found the existing program for the government to pay for contraceptives (for exempted nonprofit entities) as evidence of a less restrictive alternative. So the government pays for the thing that for-profit corporations don’t want to pay for. In other words, we now subsidize corporate religious beliefs. And if you are a corporation do you want to pay for something that competitors don’t have to? The sincerity of the belief might be an issue, but if corporate law teaches us one thing, it is how to build a record.
Formatting changes/errors are all mine.
Great work, Anne!