For-profit, secular corporations may not claim a religious exemption from providing employees with certain methods of contraception as required under President Obama’s health-care mandate, a federal appeals court ruled Friday.
In a 2-to-1 decision, the panel of the Third US Circuit Court of Appeals in Philadelphia ruled that although corporations have free speech rights under the Supreme Court’s Citizens United decision, they do not enjoy the protections of the free exercise of religion.
“We simply cannot understand how a for-profit, secular corporation – apart from its owners – can exercise religion,” Judge Robert Cowen wrote for the two-judge majority.
The case is one of 60 lawsuits across the country challenging the contraceptive portion of the employer health-care mandate on religious grounds.
Last month, the full Tenth US Circuit Court of Appeals ruled in a case involving the Hobby Lobby chain of craft stores that for-profit, secular corporations can claim the protections of religious freedom.
That court upheld an injunction blocking the required provision of contraceptive methods that offended the company owners’ religious beliefs.
The sharp disagreement between the appeals court in Philadelphia and the Tenth Circuit in Denver suggests that the dispute may now be on a fast track for review at the US Supreme Court.
Friday’s decision comes in a case filed by the owners of a Pennsylvania furniture company, all members of the same family and all devout Mennonites.
The owners objected to being forced to pay for contraception methods that they consider abortifacients.
The mandate, which took effect in January, forced the owners to choose between violating their religious beliefs or facing the destruction of their business through fines of $95,000 a day.
The company, Conestoga Wood Specialties Corporation, employs 950 workers. It provides a health insurance plan for employees in line with mandated health insurance coverage, but the owners objected on religious grounds to inclusion of certain kinds of contraceptives that involve destruction of a fertilized egg.
The five owners, all members of the Hahn family, have stated that their religion teaches that life begins at conception. “It is a sacred gift from God and only God has the right to terminate human life,” the family said in a 2012 statement.
The statement added: “It is against our moral conviction to be involved in the termination of human life through abortion, suicide, euthanasia, murder, or any other acts that involve taking human life.”
The Obama administration does not recognize an exemption from providing the full range of government-required contraceptives.
In upholding the mandate, the appeals court said that the corporation, Conestoga, was a separate entity from its owners. “Since Conestoga is distinct from the Hahns, the Mandate does not actually require the Hahns to do anything,” Judge Cowen wrote. “All responsibility for complying with the Mandate falls on Conestoga.”
He added: “It is Conestoga that must provide the funds to comply with the Mandate – not the Hahns.”
The court said it recognized that the Hahns were the sole shareholders of the company, but that ultimately they had “an obligation to respect the corporate form.”
In a dissent, Judge Kent Jordan said the majority judges were relegating religious liberty to second-class status.
He rejected the holding that for-profit, secular corporations do not enjoy the protections of religious faith under the First Amendment, and that those protections apply to individuals, not companies.
“To recognize that religious convictions are a matter of individual experience cannot and does not refute the collective character of much religious belief and observance,” Judge Jordan wrote.
“Religious opinions and faith are in this respect akin to political opinions and passions, which are held and exercised both individually and collectively,” he said.
Jordan also took issue with the idea that only those organizations that are specifically and exclusively dedicated to religious purposes enjoy constitutional protection in matters of faith.
“As the government and the Majority see it, religious rights are more limited than other kinds of First Amendment rights,” Jordan said. “All groups can enjoy secular free expression and rights to assemble, but only ‘religious organizations’ have a right to religious liberty.”
He called the government’s position a “power grab,” and said he would hold that Conestoga could invoke the right to religious liberty on its own behalf.
The case is Conestoga Wood Specialties Corporation v. Secretary of the Department of Health and Human Services (13-1144).