Medina v. Catholic Health Initiatives
147 F. Supp. 3d 1190
D. Colo.2015Background
- Plaintiff Janeen Medina (a former CHI employee) brought a putative class action under ERISA challenging Catholic Health Initiatives’ (CHI) designation of its defined‑benefit plan (the CHI Plan) as a “church plan.”
- The CHI Plan was created in 1997 and the IRS issued a private letter ruling in 2002 treating it as a church plan; CHI is the civil counterpart to a canonical public juridic person (Catholic Health Care Federation, CHCF) and is listed in The Official Catholic Directory.
- The Plan is administered by the CHI & Affiliates Defined Benefit Plan Subcommittee (DB Plan Subcommittee), whose members are appointed by CHI’s Board of Stewardship Trustees (BOST) and whose expenses are paid by CHI.
- Plaintiff argues CHI is not a church (or church‑controlled/associated) and that less than “substantially all” (i.e., <85%) of covered employees are church employees, so the church‑plan exemption does not apply.
- Defendants contend the Plan qualifies under 29 U.S.C. § 1002(33)(C) because the Subcommittee’s principal function is plan administration and it is associated with/controlled by the Catholic Church; defendants also argue the exemption is constitutional.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the CHI Plan is a "church plan" under 29 U.S.C. §1002(33) | Medina: CHI is not a church or church‑controlled/associated, so the exemption does not apply | CHI: The Plan is sponsored/maintained by entities controlled by or associated with the Catholic Church (CHCF/CHI), and the Subcommittee administers the Plan | Court: Plan qualifies as a church plan under §1002(33)(C); summary judgment for CHI |
| Whether the Plan administrator (DB Subcommittee) is controlled by or associated with a church | Medina: Subcommittee is not church‑controlled/associated; it is effectively a secular committee | CHI: Subcommittee’s principal function is plan administration; it is appointed by BOST, bound to Church mission/ERDs, and funded by CHI, thus associated/controlled | Court: Subcommittee is plainly “associated” (shares common religious bonds); association suffices under §1002(33)(C) |
| Whether "substantially all" plan participants are church employees (85% test) | Medina: Too many participants (not church employees), focusing on Centura employees, so the Plan fails the 85% test | CHI: Historically very few non‑church employers; Centura is a church‑affiliated joint venture listed in Official Catholic Directory; CHI maintains policies to keep non‑exempt employers minimal | Court: Evidence supports that the Plan meets the “substantially all” requirement; Centura and other parties are church‑affiliated; Plan status stands |
| Whether applying the church‑plan exemption here violates the Establishment Clause | Medina: Recognizing exemption here improperly favors religion | CHI: Congress enacted the exemption to avoid entanglement; exemption has secular purpose and does not meaningfully advance religion | Court: Exemption passes Lemon (purpose, effect, entanglement) and does not violate the Establishment Clause |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment burden rules)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (genuine dispute standard)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (materiality and summary judgment standard)
- Chronister v. Baptist Health, 442 F.3d 648 (8th Cir. 2006) (church‑plan principles and association analysis)
- Lown v. Continental Cas. Co., 238 F.3d 543 (4th Cir. 2001) (factors for association with a church)
- Continental Can Co. v. Chicago Truck Drivers, 916 F.2d 1154 (7th Cir. 1990) ("substantially all" 85% guidance)
- Lemon v. Kurtzman, 403 U.S. 602 (Establishment Clause test)
- Corporation of the Presiding Bishop v. Amos, 483 U.S. 327 (accommodation of religion and statutory exemptions)
- Walz v. Tax Comm’n of City of New York, 397 U.S. 664 (entanglement/degree analysis)