For-profit corporations, free exercise, and the HHS mandate.

• Author: Gaylord, Scott W.
• Position: Dept. of Health and Human Services - II. The Free Exercise Clause Protects For-Profit and Non-Profit Corporations Alike... through Conclusion, with footnotes, p. 620-657

2. THE FREE EXERCISE CLAUSE PROTECTS FOR-PROFIT AND NON-PROFIT CORPORATIONS ALIKE BECAUSE, AS BELLOTTI AND WHITE DEMONSTRATE, THE RIGHT TO FREE EXERCISE IS NOT A "PURELY PERSONAL" RIGHT BUT "SERVES SIGNIFICANT SOCIETAL INTERESTS"

   The First Amendment states that "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof." (164) The Supreme Court has interpreted the Free Exercise Clause to protect the right to, among other things, believe and propound one's religious beliefs, whatever they might be. (165) Consequently, the First Amendment prohibits "governmental regulation of religious beliefs as such." (166) The government therefore is precluded from compelling affirmation of particular religious beliefs, (167) punishing the promulgation of religious beliefs that the government takes to be false, (168) discriminating against religious believers based on their religious beliefs or status as a religious person, (169) and weighing in on one side of a dispute over religious dogma or authority. (170)

   As its name suggests, though, the Free Exercise Clause protects more than religious belief and expression: "[The First] Amendment embraces two concepts[]--[the] freedom to believe and freedom to act." (171) As its name suggests, the free exercise clause is more expansive than the merely private "worship" or "freedom of conscience" language that Madison had originally proposed when drafting early versions of the First Amendment. (172) "Exercise" includes not only paradigmatic religious activity, such as worshipping, celebrating sacraments, proselytizing, and observing dietary or dress requirements, (173) but also declining to work on Saturday (174) and refusing to help build materials for war. (175) Similarly, as the federal courts have unanimously held in the HHS mandate cases, free exercise permits individuals and religious non-profits to refuse to provide coverage for certain types of contraception and sterilization procedures. (176)

   Under Bellotti, though, this is only a minimum. The First Amendment protects religious exercise generally; it is not limited to a privileged class of individual "persons" who seek to act on their religious beliefs--and for good reason. (177) For many believers, religious practice cannot be restricted to the private expression of religion in one's home or place of worship. Their faith permeates all aspects of their lives, leading them to form groups and associations that embody and promote the values that are central to their faith. (178) The Supreme Court has expressly acknowledged this "right to associate for the purpose of engaging in those activities protected by the First Amendment--speech, assembly, petition for the redress of grievances, and the exercise of religion. The Constitution guarantees freedom of association of this kind as an indispensable means of preserving other individual liberties." (179)

   Not surprisingly, then, the First Amendment limits the government's ability to interfere with any and all forms of religious exercise and speech. It does not restrict these fundamental constitutional protections to natural persons in their individual speech activity or exercise of religion:

   The First Amendment does not say that only one kind of corporation enjoys this right [to exercise religion]. The First Amendment does not say that only religious corporations or only not-for-profit corporations are protected. The First Amendment does not authorize Congress to pick and choose the persons or the entities or the organizational forms that are free to exercise their religion. (180) That the First Amendment protects speech and the free exercise of religion regardless of who is invoking that protection is apparent from Bellotti. Instead of focusing on "whether corporations 'have' First Amendment rights and, if so, whether they are coextensive with those of natural persons," Bellotti instructs that "the question must be whether" the religiously motivated activity falls within an area "the First Amendment was meant to protect." (181) That is, the operative question under the First Amendment is what is being done--whether there is an infringement on speech or the exercise of religion--not on who is speaking or exercising religion: "First Amendment protection extends to corporations ... [, and the Court] has thus rejected the argument that ... corporations or other associations should be treated differently under the First Amendment simply because such associations are not natural persons." (182) Hence, the Bellotti Court emphasized that "[i]f the speakers here were not corporations, no one would suggest that the State could silence their proposed speech. It is the type of speech indispensable to decisionmaking in a democracy, and this is no less true because the speech comes from a corporation rather than an individual." (183)

   Consistent with Bellotti, the Court has recognized that a non-profit corporation can invoke the Free Exercise Clause, even when it is not a pervasively "religious organization" such as a church. (184) In Bob Jones University v. United States, the Court held that two religious schools, which were not "churches or other purely religious institutions," (185) could assert free exercise claims on behalf of the corporations, not merely on behalf of the individuals who comprised them. (186) The Court permitted the schools to pursue their claim that the IRS violated the Free Exercise Clause by rescinding their tax-exempt status as a result of allegedly discriminatory admissions policies. Similarly, last term in Hosanna-Tabor Evangelical Lutheran Church and School v. E.E.O.C., the Court acknowledged that another religious organization, this time a church and school, could invoke the protection of the Free Exercise Clause. (187) Although the Court noted that "the text of the First Amendment itself ... gives special solicitude to the rights of religious organizations[,]" (188) it did not limit the Free Exercise Clause to such religious organizations or distinguish its prior holding in Bob Jones University. Rather, the Court focused on the only issue before it: whether a religious organization has the "freedom to select its own ministers." (189) The Court held that it did. (190)

   Moreover, because the First Amendment protects speech and religious activity generally, having a profit-seeking motive is not sufficient to defeat a business's speech or free exercise claim. (191) On two separate occasions, the Court has upheld the right of sole proprietorships, which are profit-seeking enterprises, to invoke the protection of the Free Exercise Clause. In United States v. Lee, the Court held that an Amish business owner, who ran a farm and carpentry shop, could raise a free exercise defense to his alleged failure to pay social security taxes for his employees. (192) Because the Old Order Amish "believe it sinful not to provide for their own elderly and needy," (193) the employer "objected] on religious grounds to receipt of public insurance benefits and to payment of taxes to support public insurance funds." (194) Likewise, in Braunfeld v. Brown, "merchants" in Philadelphia challenged the city's Sunday-closing laws because the laws allegedly infringed on their free exercise of religion. (195) The merchants were Orthodox Jews who observed the Sabbath on Saturday. As a result of the Sunday-closing laws and their faith, the merchants could not open their stores on the weekends. (196) Given their desire to live out their religious beliefs in their businesses, they argued that the law violated the Free Exercise Clause because it "impairfed] the ability of all appellants to earn a livelihood." (197) In addressing their claims on the merits, the Court acknowledged that the profit motive of the plaintiffs did not subvert their right to bring a free exercise claim. (198)

   As discussed in the following subsections, taken together these cases highlight three reasons why the Third Circuit and the federal district courts erred in holding that corporations cannot invoke the protection of the Free Exercise Clause: (i) the Free Exercise Clause is not a "purely personal" right; (ii) just as freedom of speech is not limited to corporations in the "speech business," free exercise applies to for-profit corporations as well as non-profits in the "religion business;" and (iii) limiting free exercise to non-profit religious organizations discriminates against religious groups and individuals who seek to live their faith through their for-profit corporations.

   1. Because, as the Supreme Court Previously Acknowledged, Non-Profit Corporations Can Exercise Religion, the Free Exercise Clause Is Not a "Purely Personal" Right That Applies "Only to Natural Individuals"

      Following the district court's reasoning in Hobby Lobby Stores, Inc. v. Sebelius, (199) several federal courts have held that "the exercise of religion [is] a 'purely personal' guarantee that cannot be extended to corporations." (200) Drawing on a footnote in Bellotti, (201) these courts note that the Supreme Court has refused to extend certain constitutional rights, such as the privilege against self-incrimination and the right to privacy, to corporations. (202) They also recognize that under Bellotti whether a constitutional provision is purely personal "depends on the nature, history, and purpose of the particular provision." (203) But, instead of analyzing the cases that discuss "purely personal" rights or evaluating "the nature, history, and purpose" of the Free Exercise Clause, several of these courts rely on isolated sentences in Wallace v. Jaffree (204) and Schempp (205) to support their conclusion that for-profit corporations cannot exercise religion: "[The purpose of the free exercise clause] is to secure religious liberty in the individual by prohibiting any invasions thereof by civil authority." (206) Presumably, because these district courts view free exercise as an individual...