Conestoga Wood Specialties Corp. v. Secretary of the United States Department of Health & Human Services

724 F.3d 377, 2013 WL 3845365, 2013 U.S. App. LEXIS 15238, 121 Fair Empl. Prac. Cas. (BNA) 66
CourtCourt of Appeals for the Third Circuit
DecidedJuly 26, 2013
Docket13-1144
StatusPublished
Cited by34 cases

This text of 724 F.3d 377 (Conestoga Wood Specialties Corp. v. Secretary of the United States Department of Health & Human Services) is published on Counsel Stack Legal Research, covering Court of Appeals for the Third Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Conestoga Wood Specialties Corp. v. Secretary of the United States Department of Health & Human Services, 724 F.3d 377, 2013 WL 3845365, 2013 U.S. App. LEXIS 15238, 121 Fair Empl. Prac. Cas. (BNA) 66 (3d Cir. 2013).

Opinions

OPINION

COWEN, Circuit Judge.

Appellants Conestoga Wood Specialties Corporation (“Conestoga”), Norman Hahn, Elizabeth Hahn, Norman Lemar Hahn, Anthony Hahn, and Kevin Hahn (collectively, “the Hahns”) appeal from an order of the District Court denying their motion for a preliminary injunction. In their Complaint, Appellants allege that regulations promulgated by the Department of Health and Human Services (“HHS”), which require group health plans and health insurance issuers to provide coverage for contraceptives, violate the Religious Freedom Restoration Act, 42 U.S.C. § 2000bb (“RFRA”) and the Free Exercise Clause of the First Amendment of the United States Constitution.1 The District Court denied a preliminary injunction, concluding that Appellants were unlikely to succeed on the merits of their claims. See Conestoga Wood Specialties Corp. v. Sebelius, 917 F.Supp.2d 394 (E.D.Pa.2013). Appellants then filed an expedited motion for [381]*381a stay pending appeal with this Court, which was denied. See Conestoga Wood Specialties Corp. v. Sec’y of the United States Dep’t of Health & Human Servs., No. 13-1144, 2013 WL 1277419 (3d Cir. Feb. 8, 2013). Now, we consider the fully briefed appeal from the District Court’s denial of a preliminary injunction.

Before we can even reach the merits of the First Amendment and RFRA claims, we must consider a threshold issue: whether a for-profit, secular corporation is able to engage in religious exercise under the Free Exercise Clause of the First Amendment and the RFRA. As we conclude that for-profit, secular corporations cannot engage in religious exercise, we will affirm the order of the District Court.

I.

In 2010, Congress passed the Patient Protection and Affordable Care Act, Pub.L. No. 111-148 (March 23, 2010) (“ACA”). The ACA requires' employers with fifty or more employees to provide their employees with a minimum level of health insurance. The ACA requires nonexempt group plans to provide coverage without cost-sharing for preventative care and screening for women in accordance with guidelines created by the Health Resources and Services Administration (“HRSA”), a subagency of HHS. See 42 U.S.C. § 300gg-13(a)(4).

The HRSA delegated the creation of guidelines on this issue to the Institute of Medicine (“IOM”). The IOM recommended that the HRSA adopt guidelines that require non-exempt group plans to cover “[a]ll Food and Drug Administration approved contraceptive methods, sterilization procedures, and patient education and counseling for women with reproductive capacity.”2 These recommended guidelines were approved by the HRSA. On February 15, 2012, HHS, the Department of the Treasury, and the Department of Labor published final rules memorializing the guidelines. See 77 Fed.Reg. 8725 (Feb. 15, 2012).3 Under the regulations, group health plans and health insurance issuers are required to provide coverage consistent-with the HRSA guidelines in plan years beginning on or after August 1, 2012, unless the employer or the plan is exempt.4 Appellants refer to this requirement as the “Mandate,” and we use this term throughout this opinion. Employers who fail to comply with the Mandate face a penalty of $100 per day per offending employee. See 26 U.S-.C. § 4980D. The Department of Labor and plan participants may also bring a suit against an employer that fails to comply with the Mandate. See 29 U.S.C. § 1132.

II.

The Hahns own 100 percent of the voting shares of .Conestoga. Conestoga is a Pennsylvania for-profit corporation that manufactures wood cabinets and has 950 employees. The Hahns practice the Mennonite religion. According to their Amended Complaint, the Mennonite Church “teaches that taking of life which [382]*382includes anything that terminates a fertilized embryo is intrinsic evil and a sin against God to which they are held accountable.” .(Am. Compl. ¶ 30.)5 Specifically, the Hahns object to two drugs that must be provided by group health plans under the Mandate that “may cause the demise of an already conceived but not yet attached human embryo.” (Id. at ¶ 45.) These are “emergency contraception” drugs such as Plan B (the “morning after pill”) and ella (the “week after pill”). The Amended Complaint alleges that it is immoral and sinful for Appellants to intentionally participate in, pay for, facilitate, or otherwise support these drugs. (Id. at ¶ 32.) Conestoga has been subject to the Mandate as of January 1, 2013, when its group health plan came up for renewal. As a panel of this Court previously denied an injunction pending appeal, Conestoga is currently subject to the Mandate, and in fact, Appellants’ counsel represented during oral argument that Conestoga is currently complying with the Mandate.

III.

We review a district court’s denial of a preliminary injunction for abuse of discretion, but review the underlying factual findings for clear error and questions of law de novo. Am. Express Travel Related Servs. v. Sidamon-Eristoff, 669 F.3d 359, 366 (3d Cir.2012). The District Court had jurisdiction over this case under 28 U.S.C. § 1331. This Court has appellate jurisdiction under 28 U.S.C. § 1292(a)(1).

“A party seeking a preliminary injunction must show: (1) a likelihood of success oil the merits; (2) that it will suffer irreparable harm if the injunction is denied; (3) that granting preliminary relief will not result in even greater harm to the nonmoving party; and (4) that the public interest favors such relief.” Kos Pharms., Inc. v. Andrx Corp., 369 F.3d 700, 708 (3d Cir.2004). A plaintiff seeking an injunction must meet all four criteria, as “[a] plaintiff’s failure to establish any element in its favor renders a preliminary injunction inappropriate.” NutraSweet Co. v. Vit-Mar Enters., Inc., 176 F.3d 151, 153 (3d Cir.1999). This is the same standard applied in the District Court, and, on appeal, no party has questioned its accuracy.6 We will first consider whether Appellants are likely to succeed on the merits of their claim, beginning with the claims asserted by Conestoga, a for-profit, secular corporation.

IV.

A.

First, we turn to Conestoga’s claims under the First Amendment. Under the First Amendment, “Congress shall make no law respecting the establishment of religion or prohibiting the free exercise thereof.” The threshold question for this [383]*383Court is whether Conestoga, a for-profit, secular corporation, can exercise religion. In essence, Appellants offer two theories under which we could conclude that Conestoga can exercise religion: (a) directly, under the Supreme Court’s recent decision in Citizens United, and (b) indirectly, under the “passed through” method that has been articulated by the Court of Appeals for the Ninth Circuit. We will discuss each theory in turn.

In Citizens United,

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724 F.3d 377, 2013 WL 3845365, 2013 U.S. App. LEXIS 15238, 121 Fair Empl. Prac. Cas. (BNA) 66, Counsel Stack Legal Research, https://law.counselstack.com/opinion/conestoga-wood-specialties-corp-v-secretary-of-the-united-states-ca3-2013.