D.C. court: Contraceptive mandate violates religious business owners' rights

Adding to the list of divergent high-level rulings on the contraceptive mandate, the D.C. Circuit Court of Appeals ruled Friday that the mandate does violate the free exercise rights of religious business owners. The court, hearing an appeal from the Catholic owners of Freshway Foods and Freshway Logistics, granted a preliminary injunction to the owners and sent the case back to the district court.

The American Center for Law and Justice (ACLJ), which is handling the lawsuit, said it would appeal the mixed decision to the U.S. Supreme Court because the D.C. Circuit’s ruling only applied to the owners, not to the company. The ruling “failed to protect the rights of the companies involved,” the group said in a statement.

More than half a dozen circuit court cases have gone in favor of religious business owners challenging the mandate, but the 6th Circuit has twice ruled against such challengers. Still, cases are in a preliminary stage—most courts haven’t addressed cases on their merits. The U.S. Supreme Court is likely to take up at least one of these religious business owner cases this term.

The D.C. Circuit’s opinion, split 2-1, said the Catholic owners of Freshways—brothers Francis and Philip Gilardi—found themselves “on the horns of an impossible dilemma” because they morally oppose contraceptives, abortion, and sterilization. The court said the mandate is “as directed to the Gilardis, a palpable and discernible infringement on free exercise.” The Gilardis’ companies face $14 million in fines for not abiding by the mandate, which requires businesses to offer coverage for contraceptives, abortion, and sterilization under their employee health insurance plans.

“The burden is too remote and too attenuated, the government says, as it arises only when an employee purchases a contraceptive or uses contraceptive services,” the court wrote. “We disagree with the government’s foundational premise. The burden on religious exercise does not occur at the point of contraceptive purchase; instead, it occurs when a company’s owners fill the basket of goods and services that constitute a healthcare plan. In other words, the Gilardis are burdened when they are pressured to choose between violating their religious beliefs in managing their selected plan or paying onerous penalties.”

For a law infringing on religious exercise rights to be constitutional, the government must have a “compelling interest” and use the “least restrictive means” to accomplish that interest. The court said the contraceptive mandate did not meet either criteria.

The practical result of the ruling is unclear, because the court said the business itself did not qualify for a preliminary injunction, but the owners did. The lawyer for the Gilardis, Francis Manion of the ACLJ, said just a couple hours after the ruling that he was still trying to parse what exactly that meant.

“It basically didn’t decide it, but did,” Manion said. “It’s almost like an invitation to have the Supreme Court consider the question.”

The question of whether religious business owners or the businesses themselves have free exercise protections is new to courts. Hobby Lobby has already asked the high court to consider its case, even though it won at the 10th Circuit, which adds to the likelihood that the Supreme Court would take up the case.