Saturday, December 29, 2012

7th Circuit: Contraceptive Coverage Mandate Imposes Substantial Free Exercise Burden On Business Owners

The U.S. 7th Circuit Court of Appeals yesterday, in a 2-1 decision, issued an injunction pending appeal preventing enforcement of the Affordable Care Act contraceptive coverage mandate against a small for-profit construction company. The company's Catholic owners say the mandate violates their religious liberty.  In Korte v. Sebelius, (7th Cir., Dec. 28, 2012), the court explicitly disagreed with the 10th Circuit's holding last week in the Hobby Lobby case that the mandate did not impose a substantial burden on religious exercise. (See prior posting.)  The 7th Circuit majority said:
we think this misunderstands the substance of the claim. The religious‐liberty violation at issue here inheres in the coerced coverage of contraception, abortifacients, sterilization, and related services, not—or perhaps more precisely, not only—in the later purchase or use of contraception or related services.... [T]he Kortes have established a reasonable likelihood of success on their claim that the contraception mandate imposes a substantial burden on their religious exercise.
In the case, an Illinois federal district court (see prior posting) had found no substantial burden, in part because the company's current health insurance plan covers contraceptives. Apparently plaintiffs were unaware of this until shortly before they filed the current lawsuit. The 7th Circuit majority said: "it is well‐established that a religious believer does not, by inadvertent nonobservance, forfeit or diminish his free‐exercise rights."

Judge Rovner dissented, concluding that plaintiffs had not shown either irreparable harm or a likelihood of success on the merits, saying:
What the Kortes wish to do is to preemptively declare that their company need not pay for insurance which covers particular types of medical care to which they object, despite the fact that neither the company nor its owners are involved with the decision to use particular services, nor do they write the checks to pay the providers for those services.
American Center for Law and Justice issued a press release announcing the decision. Reuters today reports on the decision.