Conestoga Wood Specialities Corp. v. Sebelius
917 F. Supp. 2d 394
E.D. Pa.2013Background
- ACA requires large employers to provide health insurance including contraceptive coverage under HRSA/IOM guidelines.
- HRSA adopted IOM guidelines; interim final regulations adopted; penalties for noncompliance under 26 U.S.C. §§ 4980D, 4980H and related statutes.
- Exemptions exist for grandfathered plans and religious employers; a safe harbor for certain non-profits was announced but not for Conestoga.
- Conestoga Wood Specialties is a closely-held, for-profit Pennsylvania corporation; Hahns are Mennonite and oppose abortifacient contraception on religious grounds; plan excludes contraception coverage.
- Plaintiffs seek declaratory and injunctive relief; district court discusses standing and likelihood of success on First Amendment and RFRA claims; preliminary injunction denied.
- Complete list of defendants includes key federal agencies (HHS, DOL, Treasury) and secretaries in official capacities; decision issued January 11, 2013.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to sue | Plaintiffs allege injury traceable to the mandate | Injuries possibly self-inflicted; grand fathering later eligibility | Plaintiffs have Article III standing |
| Conestoga free exercise rights under First Amendment | Citizens United extends free exercise to corporations; Conestoga may sue | For-profit secular corporations lack free exercise rights | Conestoga cannot assert Free Exercise rights; no likelihood of success on this claim |
| RFRA substantial burden on Hahns' religion | Regulations compel conduct conflicting with beliefs; substantial burden | Burden is too attenuated and not substantial; Conestoga cannot exercise religion | Hahns' RFRA claim fails; no substantial burden |
| Establishment Clause compliance | Religious exemption discriminates among denominations and creates entanglement | Exemption is permissible neutral accommodation; not excessive entanglement | Religious employer exemption does not violate Establishment Clause |
| Free Speech concerns (compelled funding) | Mandated coverage compels funding of speech about contraception | Regulation concerns conduct, not speech; viewpoint neutral | Free Speech claim unlikely to succeed; no compelled viewpoint speech |
Key Cases Cited
- Citizens United v. FEC, 558 U.S. 310 (U.S. 2010) (recognizes corporate free speech rights; not extending free exercise rights to corporations)
- U.S. v. Lee, 455 U.S. 252 (U.S. 1982) (government can regulate religious practice within constitutional limits)
- Hosanna-Tabor Evangelical Lutheran Church & Sch. v. EEOC, 132 S. Ct. 694 (U.S. 2012) (ministerial exception; religious organizations’ special protections)
- Tyndale House Publishers, Inc. v. Sebelius, 904 F. Supp. 2d 106 (D.D.C. 2012) (RFRA/substantial burden analysis in contraceptive mandate context)
- Legatus v. Sebelius, 901 F. Supp. 2d 980 (E.D. Mich. 2012) (RFRA/substantial burden; criticized here for reasoning on private pass-through)