In trying to defend President Obama’s unlawful HHS mandate, the Department of Justice has resorted to the extraordinary claim that the owner of property has no religious-liberty rights in his use or control of property if the property is a corporation engaged in a “secular” business. (See DOJ brief at 18-21, 35 (contending, inter alia, that burden on religious exercise of owners of family business is “not cognizable” under RFRA and the First Amendment if the business is a “legally separate, secular corporation”).)
Never mind that nothing in the jurisprudence of religious liberty supports that claim. Never mind that there’s no coherent basis for believing that the religious-liberty rights of business owners should turn on whether or not they operate through the corporate form. Never mind that even the Ninth Circuit (see slip op. at 8453-8454 & n. 9) has recognized that the owners of a corporation engaged in business activity have free-exercise rights in carrying out their business. (See generally ADF Reply at 3-6.)*
Note that the question whether the owners of a corporation, including the owners of an incorporated family business, have free-exercise rights in how they conduct their business is distinct from the question whether the corporation itself has free-exercise rights. The latter may be a less obvious question, though the Ninth Circuit’s sound position that the corporation has standing to assert the free-exercise rights of its owners may render it immaterial.
Judge John L. Kane Jr., a senior federal district judge (appointed by President Carter) in Colorado, will announce his ruling tomorrow on the motion for preliminary injunction that the owners of a family business have filed—on behalf of themselves as individuals as well as on behalf of their corporation—against the HHS mandate (in Newland v. Sebelius). Let’s hope that Judge Kane sees through DOJ’s nonsense.
* Further, DOJ fatally undermines its own position when it points out that a “group health care plan is a legally separate entity from the company that sponsors it.” (Brief at 19 n. 12.) If legal separation were dispositive, that would mean that even the owners of an unincorporated business would have no religious-liberty rights against the HHS mandate since the mandate formally applies only against the business’s group health care plan.
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