William Grote, III v. Kathleen Sebe
708 F.3d 850
7th Cir.2013Background
- Grote Family owns Grote Industries, a private, family-run business with a self-funded health-insurance plan covering ~464 U.S. employees.
- Before 2013, the plan did not cover abortifacients, contraception, or sterilization in line with the family’s Catholic beliefs.
- The ACA contraception mandate requires no-cost coverage for FDA-approved contraception and related services; the plan renews annually on January 1, triggering coverage as of January 1, 2013.
- Grote Industries sued October 29, 2012, challenging RFRA and other constitutional claims against enforcement of the contraception mandate; the district court denied a preliminary injunction on December 27, 2012.
- The Seventh Circuit granted an injunction pending appeal in a nearly identical case (Korte v. Sebelius) and consolidated Grote with Korte for briefing and argument; the district court’s reconsideration was denied, and this appeal followed.
- The court now consolidates Grote with Korte and grants the injunction pending resolution of the appeal, enjoining enforcement of the contraception mandate against Grote Family and Grote Industries.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| RFRA substantially burdens religious exercise. | Grote seeks RFRA exemption; burden on faith is direct and substantial. | Government argues burden is not substantial or properly attributable to the owners. | Reasonable likelihood of success on RFRA claim. |
| Irreparable harm and balance of harms support injury pending appeal. | Injunction necessary to prevent ongoing religious-liberty harm and penalties. | No irreparable harm or balance not tipping in plaintiffs’ favor. | Irreparable harm shown; balance of harms favors the injunction. |
| Corporations vs. individuals under RFRA; scope of religious-liberty rights. | Grote Industries’ owners may invoke RFRA to exempt the plan. | Corporate form should limit reliance on RFRA; burden tied to plan and employees. | Corporate form not dispositive; RFRA rights extend to the Grotes in context of plan burden. |
Key Cases Cited
- Citizens United v. Fed. Election Comm'n, 558 U.S. 310 (2010) (corporate rights and political speech; foundational to corporate-liberty analyses)
- United States v. Lee, 455 U.S. 252 (1982) (proper limits of religious exemptions in secular obligations)
- Civil Liberties for Urban Believers v. City of Chicago, 342 F.3d 752 (7th Cir. 2003) (substantial burden concepts from RL UIPA/First Amendment context)
- Board of Regents of Univ. of Wis. Sys. v. Southworth, 529 U.S. 217 (2000) (funding neutrality and private choice principles in university fees)
- Zelman v. Simmons-Harris, 536 U.S. 639 (2002) (private choice and neutrality in government funding, relevant to private employee decisions)