The Edmond Sun

November 20, 2012

Federal judge denies Hobby Lobby request

Mark Schlachtenhaufen
The Edmond Sun

EDMOND — A judge has denied a Hobby Lobby request that would have exempted the Oklahoma City-based retailer from federal contraceptive health insurance rules.

On Sept. 12, Hobby Lobby, a Christian-owned and operated arts and crafts retailer, filed suit seeking a preliminary injunction, an exemption from a rule in the Patient Protection and Affordable Care Act that requires businesses with more than 50 employees to cover what the company calls “abortion-inducing” drugs.

Fines for businesses with more than 50 employees not participating in the required coverage begin Jan. 1. Hobby Lobby says it could face fines of up to $1.3 million a day, $26 million a year. Founded by David Green in 1970, Hobby Lobby operates 524 stores with more than 13,000 full-time employees. The family also operates Mardel, a Christian book, homeschooling and teacher supply retailer.

The plaintiffs sought a preliminary injunction in which they asked the court on Nov. 1 to prohibit the federal government from enforcing the mandate against them. In essence, they sought an exemption.

Kyle Duncan, general counsel for the Becket Fund for Religious Liberty, said the plaintiffs disagree with this decision and will immediately appeal it.  

“Every American, including family business owners like the Greens, should be free to live and do business according to their religious beliefs,” Duncan said. “The Green family needs relief now and we will seek it immediately from the federal appeals court in Denver.”

The Green family has no moral objection to the use of preventive contraceptives and will continue covering preventive contraceptives for its employees, Duncan said.

The Green family’s religious convictions prohibit them from providing or paying for the abortion-inducing drugs, the “morning after” and “week after” pills, which would violate their most deeply held religious belief that life begins at conception. Duncan said.

In a 28-page order filed Monday in the Western District of Oklahoma U.S. District Judge Joe Heaton stated that the lawsuit is one of many challenging various aspects of the Affordable Care Act.

In this case, the issues presented by the parties were whether the preventative services coverage provision passes muster under the U.S. Constitution, and whether it violates the Religious Freedom Restoration Act of 1993.

“Hobby Lobby and Mardel, as secular, for-profit companies, do not satisfy the ACA’s definition of a ‘religious employer’ and are ineligible for the protection of the safe-harbor provision,” the judge stated in the order. “Their health plans also are not grandfathered under the Act.”

The mandate takes effect on Jan 1, when the plan year begins. The plaintiffs argued, in part, that they would be harmed by unjust fines levied by the federal government.

Judge Heaton stated that a preliminary injunction is an extraordinary remedy and should “not be used unless the movant’s right to relief is ‘clear and unequivocal,’” citing Heideman v. South Salt Lake City.

To obtain an injunction, a plaintiff must establish that they will suffer irreparable injury that outweighs whatever damage the proposed injunction may cause the opposing party, that the injunction would not be adverse to the public interest and that there is substantial likelihood of success on the merits, the judge stated.

The judge agreed with the plaintiffs that the questions presented are “serious, substantial, difficult and doubtful.” But an additional limitation on the applicability of the “less rigorous fair-ground-for-litigation standard” exists.

Judge Heaton concluded that the plaintiffs did not show a “clear and unequivocal” right to injunctive relief in light of the applicable standards, that they have not made the necessary showing of a likelihood of success on the merits to warrant a preliminary injunction and they have not demonstrated a probability of success on their First Amendment claims.

The plaintiffs also failed to demonstrate a probability of success on their Religious Freedom Act claims, the judge stated. Hobby Lobby and Mardel are not “persons” for purposes of the law and the Greens have not established that compliance with the mandate would “substantially burden” their religious exercise. | 341-2121, ext. 108