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Wednesday, January 02, 2013

The Citizens United Link to the Affordable Care Act Litigation

It’s not too often that I try to draw a line between my own field of Election Law and the much less familiar field involving the Religion Clauses. That’s a universe I tend to leave to the very capable hands of folks like Rick GarnettMichael Helfand, and Paul Horwitz. But recent litigation did part of the work, and it raised important issues that, I think, the Supreme Court is ultimately going to need to consider. And it has to do with who, or what, is a person.

In 2010, the Supreme Court handed down its opinion in Citizens United v. FEC, which, among other things, struck down limitations on corporate independent expenditures in the Bipartisan Campaign Reform Act of 2002. One important element of the opinion was the conclusion that the identity of the speaker—in that case, a for-profit corporation—could not be subjected to special restrictions on political expenditures.

This conclusion, according to one justice, prompted pithy bumper stickers regarding corporate personhood. But it’s important to note that even the dissent agreed on larger point: that corporations have First Amendment rights. It’s just that the dissent argued that Congress had a compelling reason to single out for-profit corporations (because of, among other things, their perpetual life, and their ability to aggregate wealth through special tax structures); the majority found no such compelling reason to single out one corporate form over others.

And the dispute was, uniquely, about for-profit corporations. The Supreme Court had previously accepted expenditure limitations placed upon for-profit corporations but routinely rejected similar limitations for media corporations and non-profit “ideological” corporations. In Citizens United, the Court, revisiting its precedent, rejected the argument that Congress had articulated any meaningful distinction that merited a set of rules restricting expenditures for for-profit corporations.

A similar debate is brewing in the context of the Patient Protection and Affordable Care Act. Employers offering health insurance plans must include coverage for FDA-approved contraceptives (including what the FDA calls “emergency contraceptives,” sometimes known as “abortifacients”), sterilization procedures, and other reproduction-related services.

A very small set of “religious employers” is exempt. But there are many more for-profit corporations owned and operated by religious adherents. These corporations may not fit the narrow exemption for “religious employers,” and religious adherents have argued vociferously that even ostensibly “secular” businesses fall under the scope of the Free Exercise Clause and the Religious Freedom Restoration Act (“RFRA”). (There are, of course, nuances between constitutional interpretation and statutory interpretation, which may yield different results.)

Do they? District courts in Colorado, the District of Columbia, and Missouri have punted on the issue. A district court in Oklahoma did the same, in part; but, it also found that, absent precedent that “secular, for-profit corporations” have free exercise rights, plaintiffs failed in their Free Exercise Claims. It also suggested that RFRA applied to “religious organizations, not general business corporations.” Justice Sotomayor, in denying an injunction, specifically noted that the Supreme Court has not addressed “similar RFRA or free exer­cise claims brought by closely held for-profit corporations and their controlling shareholders.”

Well, do they? Can the Supreme Court ascribe a telos to for-profit corporations? Does it matter that Hobby Lobby is closed on Sundays? That Mardel Christian bookstores are “dedicated to renewing minds and transforming lives”? If there’s a possible theological dimension to Division I FBS football, would we (or should we) care?

Jonathan Adler isn’t necessarily persuaded. Ed Whelan is. And Josh Blackman is asking questions.

The same questions arose in Citizens United, and they arise here again. There, no one really disputed that media and non-profit ideological corporations had First Amendment protection. Here, no one really disputes that, say, a religious group called O Centro Espirita Beneficiente Uniao Do Vegetal has First Amendment protection.

When it comes to for-profit corporations, however, there are hints (and this is my modest prediction) that the Court’s refusal to inquire into the purpose or form of the corporation in the election law context may very well apply to the religious liberties context. The burdens placed upon corporations are likely to face the same scrutiny, regardless of the purpose or the form of the corporation. And that means, businesses like Hobby Lobby, under the Court’s precedent in Citizens United, would be treated as any other individual, church, or non-profit organization making a Free Exercise claim.

But, would anyone hazard to make a bolder claim?

Posted by Derek Muller on January 2, 2013 at 10:17 AM in First Amendment, Law and Politics, Religion | Permalink


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Thanks for this. We've done some empirical work related to the issue of employers as political speakers regarding the ACA here: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2138828

Posted by: Elizabeth Weeks Leonard | Jan 4, 2013 6:40:09 AM

As others have written elsewhere, it's hard to claim that the contraception mandate is a neutral law of general applicability when it exempts over 50 million employees, about a third of the U.S. workforce, from its coverage. Indeed, the exemptions appear to be so broad as to undercut the compelling governmental interest rationale. However, plaintiffs continue to have standing problems.

Posted by: James | Jan 2, 2013 9:51:12 PM

Not to nitpick, but Citizens United, the firm, actually was a nonprofit. The CU holding pertains to a federal law restricting political spending out of the general treasury funds of corporations, whether for-profit or not. And (as Larry Ribstein pointed out) the Court's rationale (to the extent it was coherent at all) actually made more sense for for-profits; since nonprofit agency slack is so great, the claim that nonprofit firms' spending represents donor or member interests is implausible. All of which is to say that I don't see a meaningful doctrinal distinction based on the for-profit/nonprofit difference. (Which is not to say that CU necessarily invalidates a separate set of tax law rules restricting nonprofit politicking; I refer interested readers to my ssrn page.). My view is that Empl. Div. v. Smith easily resolves the cases you're writing about, and nothing in RFRA upends that, but admittedly I haven't thought closely about the RFRA question since litigating it in 05 or so.

Posted by: BDG | Jan 2, 2013 6:32:32 PM

Corporate speech is based on the notion (fictitious, critics would argue) that the corporation's expression is different and separate from that of the shareholders or directors, that the entity is more than just a vehicle for individual expression. In addition, protection for corporate speech was predicated (at least in the pre-CU jurisprudence) in part on the right of the public to receive information and the public still needs to hear this information, even it has a corporate source.

Neither of those ideas is present in the Free Exercise context. The concerns of faith and religious liberty are those of the individuals running the company (especially where it is a closely held company), not the company itself.

Of course, this is a normative point. Descriptively, you're probably right.

Posted by: Howard Wasserman | Jan 2, 2013 11:27:14 AM

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