Nonprofits in Michigan score victory for religious liberty

On Friday, a federal appeals court panel in Cincinnati greenlighted an effort by a religious medical nonprofit and a Roman Catholic parish and school to challenge a Michigan public accommodation law interpreted by courts to cover sexual orientation and gender identity.

Michigan’s Christian Healthcare Centers filed a complaint against the law in August 2022. Grand Rapids–based Sacred Heart of Jesus Parish and St. Joseph Parish later filed separate cases against the law. All three argue that enforcement of the law would violate their First Amendment rights to free speech and free exercise of religious beliefs.

Both the medical center and Sacred Heart of Jesus Parish, which operates Sacred Heart Academy, a classical Roman Catholic pre-kindergarten through 12th-grade school, require employees to subscribe to statements of faith which affirm Biblical beliefs about marriage and sexuality. The groups do not allow using pronouns inconsistent with biological sex, and at the school, students must use restrooms, locker rooms, and showers, and play on athletic teams, that correspond to their biological sex.

In March 2023, a federal judge threw out the challenge to the Elliott-Larsen Civil Rights Act (ELCRA) for lack of standing. U.S. District Judge Jane Beckering concluded that the plaintiffs had not yet suffered an infringement of their rights, and “mere allegations of a ‘subjective chill’ are alone insufficient to establish an injury-in-fact for standing purposes.”

Judges on the 6th U.S. Circuit Court of Appeals disagreed. Writing for the majority, Circuit Judge Jane Stranch, a Barack Obama appointee, ruled that both Christian Healthcare and Sacred Heart had demonstrated that their intended conduct was arguably prohibited by the law. Both had also demonstrated that there was a credible threat that the state law would be enforced against them.

And while state law provides a limited religious exemption to the public accommodation law, Stranch said the fact that the state refused to disavow enforcement weighed heavily in favor of the plaintiffs’ claim of injury.

The court based its ruling in part on the fact that both nonprofits wanted to publish their religious requirements. Christian Healthcare sought to advertise a Biblical counselor position that required the applicant to agree with certain beliefs such as the “immutability of sex” and “disapproval of same-sex activity and relationships.” Sacred Heart similarly wanted to hire an art teacher and athletic coach who had to agree not to encourage “same-sex relationships” or “transgender-related behavior and activity.”

In contrast, panel judges upheld the district court’s dismissal of St. Joseph Parish, which operates an elementary school in St. John’s, Mich. While it requires employees to practice beliefs similar to Christian Healthcare and Sacred Heart, the court found that St. Joseph opens its facilities to the public and does not seek to publicly communicate its beliefs, as do the other parties. St. Joseph could ask the full appeals court to consider the case or appeal directly to the U.S. Supreme Court.

Circuit Judge Eric Murphy, an appointee of former President Donald Trump, concurred in the opinion but wrote separately to emphasize his belief that the court should determine whether the state law covers the conduct before addressing the standing issue. “The Department [of Civil Rights] asserts that Christian Healthcare and Sacred Heart’s proposed activities do not even arguably fall within the [law], but it then refuses to say that it will not enforce the law against the same activities,” wrote Murphy. “If the conduct and speech do not even arguably fall within the law, how could the department in good faith try to enforce the law against that conduct and speech?”

Kate Anderson is the director of the Center for Parental Rights at Alliance Defending Freedom. “We’re all losing out when religious ministries are forced to shut their doors to those in need because of an unconstitutional threat from the government,” she said. “So when a state like Michigan tries to use their public accommodation law to tell a Catholic church and school that they can’t teach the faith because the state disagrees with it, that’s unconstitutional.”

Anderson said that both the Supreme Court’s 2018 ruling in Masterpiece Cakeshop v. Colorado Civil Rights Commission and last year’s ruling in 303 Creative v. Elenis should guide judges when the case returns to the district court.

In 303 Creative, the court vindicated a Colorado website designer who argued that the Constitution protected her from a state law that would force her to create websites for same-sex weddings because it would compel speech, or expressive activity, that she disagreed with. In Masterpiece Cakeshop, the court chastised Colorado officials who targeted Jack Phillips, a baker who declined to design cakes for same-sex weddings.

“Christian Healthcare Centers and Sacred Heart are being told what they have to say about gender identity and sexual orientation, particularly by using pronouns that violate their religious beliefs,” said Anderson. “That kind of a compulsion of speech the Supreme Court has already said violates the Constitution.”

Anderson added that the case also involved religious targeting. In the 2022 complaint that started the litigation, the plaintiffs pointed to Michigan Attorney General Dana Nessel’s own support for a broad application of the public accommodation law. “The attorney general agrees that failing to use preferred pronouns is an act of gender-identity discrimination, as the policy for her office requires employees to use preferred pronouns and contains no provision for religious accommodations or exceptions,” reads the complaint.

For now, the case heads back to the district court for reconsideration. Cautioning the district court judge that his previously-stated views about the merits of the case were not the law of the case, Stranch directed that “starting from a clean slate, the district court should undertake a full analysis of plaintiff’s motions for injunctive relief.”