Will For-Profits Suffer Legal Loss?

When a Supreme Court justice issued an order the day after Christmas, it gave us a window into a crucial religious liberty issue that has been brewing for some time. The question is whether a closely-held, for-profit religious organization can exercise religious freedom rights.

On December 26, Justice Sonia Sotomayor denied a request for a temporary injunction that had been filed by Hobby Lobby Stores, a family-owned for-profit company that has been fighting to be exempted from the strictures of the ObamaCare/HHS mandate that requires all employers to provide insurance access to abortion medications for their employees. The owners of Hobby Lobby are objecting to that mandate on religious grounds, but Sotomayor wrote that “[t]his Court has not previously addressed” the issue of closely-held, for-profit companies possessing religious liberty rights, although the High Court has ruled that commercial businesses do have other rights within the First Amendment genus, such as in the free speech realm. In the HHS mandate cases, federal judges have side-stepped the precise legal issue; instead ruling in the cases of both Domino’s Pizza and Tyndale House Publishing that they have legal “standing” to raise religious objections in their lawsuits.

The Supreme Court will eventually have to address this issue as it is a river with countless tributaries. Take as an example ENDA (Employment Nondiscrimination Act), the bill that would make it difficult or impossible for many Christian organizations to turn down homosexuals in hiring decisions unless strong religious liberty exemptions are built into it. NRB has opposed ENDA for that very reason. In my past testimony before both the House and the Senate, I pointed out the “exemption” in ENDA is similar to language already tested in one federal case, and the court there ruled that a closely-held commercial business could not enforce the religious beliefs of its owner. If the Supreme Court takes this issue up and decides wrongly, then a host of for-profit religious organizations will be without any semblance of religious freedom, including broadcasting networks, bookstores, adoption agencies, hospitals, and mental health counseling centers, to name just a few.

The “corporate status” of organizations is often described as a legal fiction, though those various corporate categories have been created for sound policy and precedential reasons. Nevertheless, to say that huge commercial organizations can possess free speech rights but that family-owned businesses cannot possess comparable rights to religious conscience would seem to be a grotesque form of science fiction. 

By Craig Parshall
Senior Vice President & General Counsel, NRB
Director, John Milton Project for Free Speech

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Published: January 10, 2013