Can corporations practice religion? The Supreme Court will soon answer that question

December 4, 2013

The Supreme Court in WashingtonIt’s been about a year and a half since the Supreme Court ruled on the constitutionality of the Affordable Care Act (ACA) in its 2012 NFIB v. Sebelius decision – thus settling the issue once and for all.

Or have they?

Actually, there’s unlikely to be a new challenge to the constitutionality of the ACA anytime soon, but the Supreme Court did just agree to review a pair of cases that deal with the legality of a new regulation created as a consequence of the health care overhaul.

The cases were consolidated into Sebelius v. Hobby Lobby Stores, Inc., and at issue before the Court is whether the so-called “contraception mandate” – that is, the requirement that employer-provided health care plans cover, “[a]ll Food and Drug Administration approved contraceptive methods, sterilization procedures, and patient education and counseling” – is legal.

The challengers from Hobby Lobby claim that the mandate violates their religious beliefs and thus runs afoul of the Religious Freedom Restoration Act of 1993 (RFRA), which requires the government to more actively accommodate religion instead of merely ensuring freedom of worship, as the First Amendment holds.

The Supreme Court will be reviewing the mandate’s validity under both RFRA and the First Amendment, however, since the second consolidated case, Conestoga Wood Specialties Corp. v. Sebelius, raises both of those issues on appeal to the high court.

The Court’s decision could have major legal implications, but the bulk of which wouldn’t have anything to do with the ACA.  Instead, the impact of this decision will be felt most acutely within the realm of constitutional jurisprudence itself, since it will answer the question, “Can corporations practice religion?”

An affirmative answer to this question could (and likely would) cause major legal upheaval.  It would be the first time that the Court has held that secular, for-profit corporations are entitled to protection under either RFRA or the Free Exercise Clause of the First Amendment.

Such a finding could allow corporations to opt out of a variety of laws that corporations claim to be “religiously objectionable.”

The most immediate impact would be to other government “mandates” under the ACA to employer health plans, such as blood transfusions (objected to by Jehovah’s Witnesses), HPV vaccines, genetic screening, or in vitro fertilization.

Of course, the more creative business owners will no doubt be able to leverage the new ruling to great effect, possibly being able to find exemption from laws relating to taxation and labor regulation, among others.

So, if the Supreme Court has never before recognized that secular, for-profit corporations could practice religion (and thus be entitled to protection from the Free Exercise Clause and RFRA), why would it do so now?

If the Tenth Circuit’s Hobby Lobby opinion could provide any indication, it’s because of 2010’s Citizens United ruling, which the appeals court cited to as rejecting the proposition that “corporations or other associations should be treated differently under the First Amendment simply because such associations are not natural persons.”

What the Tenth Circuit noticeably omitted, however, were the three words that, in the Citizens United opinion, preceded “corporations” in the above quote: “political speech of.”

This omission clearly changes the entire meaning of the quoted text from being “all political speech is equal under the First Amendment” (which the Supreme Court did state) to “all legal entities are equal under the First Amendment” (which the Supreme Court has never stated).

No one can say for certain whether this was an honest mistake or a disingenuous misrepresentation by the Tenth Circuit, but the Supreme Court may have something to say about it.

Who knows?  The Court may decide to adopt this incorrectly cited statement as its own, thereby extending freedom of religion protections to corporations.

On the other hand, it’s a far different legal principle to state that corporations are capable of political speech, just as individuals, than to say that corporations are capable of having firmly held religious beliefs.  I can’t see the Supreme Court being willing to adopt the latter holding at this point, but oral arguments will better inform us of where the Court stands.

Nevertheless, a Court finding that corporations are incapable of practicing religion isn’t necessarily fatal to the challengers’ case; SCOTUS may find narrower grounds to strike down or limit the contraception mandate.

We can be confident about one thing: this case will more likely be a sequel to Citizens United than NFIB.