The Hobby Lobby Decision: What does it really say?

Besides the United States’ unexpected, and truly awesome, performance in the World Cup, the topic that has attracted the most attention and commentary this week is the already infamous US Supreme Court Hobby Lobby decision.

Unfortunately, much of the information being disseminated does not accurately report what actually happened in the case or what the Supreme Court actually decided.

So what does the Hobby Lobby decision really say?

Let me break it down for you.

The laws at play:

The Religious Freedom Restoration Act of 1993 (the “RFRA”) prohibits the government from substantially burdening an individual’s exercise of religion, even if the burden arises from a general rule (as opposed to a rule specifically targeting religion or the exercise of religious beliefs). As of 2000, when it was amended by the Religious Land Use and Institutionalized Persons Act of 2000, the RFRA also includes “any exercise of religion, whether or not compelled by, or central to, a system of religious belief.”

The lawsuit:

The owners of three (3) closely held, for-profit corporations sued the federal Department of Health and Human Services (among other agencies).

The lawsuits claimed that the requirement under the Patent Protection and Affordable Care Act of 2010 (the “ACA”) that a corporation must provide employees access to contraceptives designed to prevent the development of an already fertilized egg violates the sincerely held religious belief of the owners (not of the corporation) that life begins at conception. Thus, the owners argued, this portion of the ACA violates their rights under the RFRA and the Free Exercise Clause.

Points to know:

  • The Decision Only Applies to Contraceptives that Prevent an Already Fertilized Egg from Further Development.

The ACA generally requires non-exempt employers to provide twenty (20) separate types of contraceptives approved by the federal Food and Drug Administration. Only four (4) of the twenty (20) contraceptives are designed to prevent an egg that has already been fertilized from attaching to the uterus wall and developing further (i.e., the “morning after pill” and IUDs).

The three (3) lawsuits only objected to those four (4) contraceptives designed to prevent a previously fertilized egg from further development.

The Hobby Lobby decision does not affect the remaining sixteen (16) contraceptives designed to prevent the fertilization of an egg. The Supreme Court’s decision thus does not prevent Hobby Lobby employees from access to those forms of contraceptives, nor does it release Hobby Lobby (and other qualifying corporations) from the responsibility to provide insurance coverage for those remaining sixteen (16) contraceptives.

  •  The Decision Only Applies to For-Profit, Closely Held Corporations.

The Hobby Lobby decision does not exempt all employers from the contraceptive requirements of the ACA; rather, it only applies to closely held corporations. Generally, a “closely held corporation” is one owned by a small number of individuals. The Internal Revenue Service defines “closely held corporation” as a corporation where (i) five (5) or fewer people own more than fifty percent (50%) of the company’s outstanding stock at any time during the last half of the tax year, and (ii) the company is not a personal service corporation. Thus, the employees of publicly traded companies (like Coca-Cola) are not affected by the Hobby Lobby decision.

The Future of Hobby Lobby

The Supreme Court’s majority opinion in Hobby Lobby clearly limits the scope of its decision to closely held, for-profit corporations. Justice Ginsberg’s dissent, however, hints at a potential broader application of the Hobby Lobby decision by identifying other cases from courts across the nation where “commercial enterprises [have sought] exemptions from generally applicable laws on the basis of their religious beliefs.”

Justice Ginsberg questions whether this particular decision will also apply to other religious-based objections to the ACA’s requirements, such as blood transfusions, antidepressants, medications derived from pigs (such as anesthesia, intravenous fluids, or pills coated with gelatin), and vaccinations.

Of course, it is impossible to predict exactly how the Hobby Lobby decision will be applied by state legislatures and courts, or whether publicly traded companies will challenge the ACA under the same arguments as the three (3) closely held corporations. A savvy business owner, however, will remain cognizant of any new developments stemming from the Hobby Lobby decision or other objections to the ACA.

If you are ever in any doubt about how a state or federal law or recent court decision may impact your business, speak to a business attorney at Briskin, Cross & Sanford.  Our business is to know.

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Water, Water, Everywhere – Or Is it Firearms? What Georgia businesses need to know about the Safe Carry Protection Act

Samuel Taylor Coleridge wrote the line “Water, water everywhere/and all the boards did shrink…” in his epic poem “The Rime of the Ancient Mariner,” but is “firearms, firearms, everywhere/and all the businesses did shirk” now more applicable for Georgia businesses?

The Georgia Safe Carry Protection Act (a.k.a., the “Guns Everywhere” law) goes into effect today, July 1, 2014. These new laws substantially expand the rights of licensed gun owners to carry their guns into myriad locations previously barred to those carrying firearms. Some of the new gun-friendly places may surprise you, as they include bars, public housing, government buildings without screening checkpoints, and churches (with the permission of the church’s governing body).

Most importantly for private businesses, the Safe Carry Protection Act reinforces the rights of both licensed and unlicensed gun owners to carry guns in their private (non-company owned) cars and trucks. Practically, both the Act and the 2010 Business Security and Employee Privacy Act not only allow employees to bring firearms onto a private employer’s parking lot but also bar employers from prohibiting concealed guns on their property.

Georgia law also limits the ability of private employers to search locked, privately owned vehicles owned by both employees and their invited guests.

So what is an employer to do?

  1. First, business owners with should determine whether or not their businesses are subject to the new Safe Carry Protection Act and/or the Business Security and Employee Privacy Act, as these laws do not apply to all types of businesses.
  2. Next, companies subject to one or both of these laws then should reevaluate any firearm policies to make sure they comply with Georgia law.
  3. Finally, business owners should contact their commercial insurance representative to ensure that the current policy covers any potential liability created by the Safe Carry Protection Act or the Business Security and Employee Privacy Act.

If, as a business owner, you are ever unsure how a new (or existing) state or federal law, or perhaps a new court decision you may have read or heard about in the news, applies to your business, that would be a great time to pick up the phone and talk to a business attorney at Briskin Cross and Sanford.

Next steps for Aereo in The People vs American Cable Monopolies?

Over the weekend, a letter from Aereo founder and CEO Chet Kanojia appeared on the Aereo website and to any of Aereo’s 500,000 or so customers who logged into the Aereo ap.  While ABC might have thought that it had cut off the hydra’s head after the Supreme Court ruled in its favor last week, Aereo is clearly still pursuing the case in the court of public opinion:

A little over three years ago, our team embarked on a journey to improve the consumer television experience, using technology to create a smart, cloud-based television antenna consumers could use to access live over the air broadcast television.

On Wednesday, June 25, the United States Supreme Court reversed a lower court decision in favor of Aereo, dealing a massive setback to consumers.

As a result of that decision, our case has been returned to the lower Court. We have decided to pause our operations temporarily as we consult with the court and map out our next steps. 

The cornerstone of the Supreme Court 6-3 ruling was the holding, as reported by Scotusblog, that “Aereo publicly performs copyrighted works, in violation of the Copyright Act’s Transmit Clause, when it sells its subscribers a technologically complex service that allows them to watch television programs over the Internet at about the same time as the programs are broadcast over the air.”

If you know anything about the Copyright Act of 1976, you probably know that copyright owners are given a bundle of rights with respect to original works of authorship, among them the exclusive right to perform the copyrighted work publicly. At the heart of this case is whether Aereo, as it claimed, merely rented a small antenna and a digital DVR to each of its customers so that they could grab “free” TV signals off the air and watch them later, or whether Aereo was acting more like a cable company and actually retransmitting copyrighted broadcasts in violation of the Act.

The majority in the Supreme Court decided that it was the latter, relying on Congress’s express emendation of the Copyright Act in 1976 to encompass cable TV companies. The basis for their reasoning was the so-called “transmit” clause, which maintains that the exclusive right to “perform” a work covered by the Copyright Act includes the exclusive right to “transmit or otherwise communicate a performance . . . of the work . . . to the public, by means of any device or process, whether the members of the public capable of receiving the performance . . . receive it in the same place or in separate places and at the same time or at different times.”

Dissenting, Justice Scalia filed an opinion joined by Justices Thomas and Alito expressing the belief that Aereo does not “perform” because Aereo’s subscribers determine their own programming selections just as a copy shop serves consumers by providing machines capable of copying anything that the consumer brings in to copy, whether it is subject to copyright or not, and it would be wrong to blame the technology for the fact that it is capable of facilitating law-breaking uses (is anyone thinking of handguns here?).

Scalia goes on to criticize the Court’s holding as stitching together a few fragments of legislative history and lacking solid foundation:

“What we have before us must be considered a ‘loophole’ in the law. It is not the role of this Court to identify and plug loopholes. It is the role of good lawyers to identify and exploit them, and the role of Congress to eliminate them if it wishes. Congress can do that, I may add, in a much more targeted, better informed, and less disruptive fashion than the crude ‘looks-like-cable-TV’ solution the Court invents today.”

While the Supreme Court ruling may appear to have ended the two-year legal battle between ABC and the feisty tech start-up, Aereo, although it originally said that there was no “plan B,” now claims that while it may be down, it is not out. As Forbes contributor Mark Rogowsky notes, Aereo “didn’t have time to seek changes to federal law. Instead, it took the path of an Uber or AirBnB: operate in a legal grey area and hope the law moves with you or affirms your actions. Unlike those other companies, however, Aereo faced big national entities who could take the matter before the ultimate Court in the land.”

While Fox and the big broadcasters may be delighted with the ruling for the time being (Fox is currently suing Dish Network in a similar case involving its Dish Anywhere app, a case that is up before the Ninth Circuit Court of Appeals next month), the blogosphere is already alight with Aereo alternatives, and it may well be that, having plucked a single dandelion head, ABC’s efforts to put down one upstart in the popular rebellion against astronomical cable fees will merely spread the seeds of innovation beyond even the reach of the large cable monopolies’ power to control.

The End of the “Pomegranate Blueberry Flavored Blend of 5 Juices”

Imagine this…

You are sitting poolside, enjoying a bottle of Minute Maid’s “Pomegranate Blueberry Flavored Blend of 5 Juices” when you happen to look at the ingredients.

It slowly dawns on you the the self-described “Pomegranate Blueberry Flavored Blend of 5 Juices” only in fact contains about 0.3% pomegranate juice and 0.2% blueberry juice.

You are outraged!

How can Minute Maid and its owner, Coca-Cola, get away with such misleading labels?

The good news is that they no longer can, thanks to POM Wonderful, LLC and a unanimous U.S. Supreme Court.

It begins (as it always does) with a lawsuit. POM Wonderful sued Coca-Cola, alleging that Coke’s label for its “Pomegranate Blueberry” juice deceives buyers into believing that the juice primarily contains both pomegranate and blueberry, thus violating Section 43(a) of the Lanham Act (which addresses situations where one company’s false advertising is causing harm to another competing business).

Coke’s response to the lawsuit was simple: its “Pomegranate Blueberry Flavored Blend of 5 Juices” label complied with the Food, Drug and Cosmetic Act (the “FDCA”) regulations, which trump the Lanham Act. Thus, Coke argued, if its label complies with the FDCA, it cannot be liable under the Lanham Act.

In a rare, and, dare we say, juicy unanimous decision, the U.S. Supreme Court sided with POM Wonderful (interestingly, it has been reported that Justice Kennedy stated during oral arguments that he was also misled by Minute Maid’s “Pomegranate Blueberry” label).

Now, a company harmed by a competitor’s false or misleading marketing of a food or beverage product can file a lawsuit under the Lanham Act, even if the marketing labels are regulated by the Food and Drug Administration and comply with the Food, Drug and Cosmetic Act.

The U.S. Supreme Court’s recent decision will have companies in the food and beverage industry scrambling to review, and possibly revise, their labels and marketing materials. Of course, this decision has farther reaching implications than just for Minute Maid and its competitors since the Supreme Court’s decision could conceivably apply to other businesses regulated by federal laws… like alcoholic beverages, transportation, even pharmaceuticals.

If you are concerned that your product label does not properly describe your product, or perhaps a competitor’s label falsely describes your competitor’s product and puts you and other honest businesses at a disadvantage, consult a trademark attorney at Briskin Cross and Sanford… before, not after, someone squeezes your juciebox for you.

Secret Endless Editing of Published Supreme Court Opinions

Stare Decisis is one of the cornerstones of U.S jurisprudence.  Simply put, it means to “stand by things decided.” It is a touchstone of our justice system that requires courts to adhere, under many circumstances, to the principles of previous rulings.

Of course, exactly how (or whether) those previous rulings apply to each new set of facts is often a matter that rests on very slight turns of phrase that the court chooses to express its opinions and shade its intentions.

So what happens if the opinion of the court changes?  I am not talking about a new discussion, a new ruling, or a new case.  What happens if the written opinion of the court somehow… just… well… changes?

An intriguing column by John W. Dean from today’s edition of the Justia online publication Verdict discusses Harvard Law professor Richard Lazarus’ forthcoming article (and the New York Times article discussing it) which highlights the US Supreme Court’s practice of employing “secretive and dubious means” to alter its written and published opinions without public notice:

Secret Endless Editing of Published Supreme Court Opinions | John Dean | Verdict | Legal Analysis and Commentary from Justia.

How unsettling it must be to have fought your way all the way to the Supreme Court, argued your case, received a favorable ruling (or not), and then to see the “law” created by the decision shift subtly over the next days, months and even years as the “Bench Opinion” is trumped by the (potentially “corrected”) “Slip Opinion,” which remains published on the Court’s website until it is replaced by the (again potentially “corrected”) collected and printed opinions for the entire term in the U.S. Reports as much as seven years later.

But even this is not the whole story, for the U.S. Reports comes out first in paperback advance pamphlets called “Preliminary Prints,” which are themselves “corrected” again and finally bound into volumes that may span several sessions.  But wait, there’s more… the “final” bound editions contain errata sheets that may again “correct” former opinions, albeit usually only very slightly.

What does this mean for you?  Maybe not much.  But it does mean that any attorney who quotes Supreme Court precedent in a brief had better make sure he or she is not relying on a phrase or sentiment that has been “corrected out” of a subsequent generation of the opinion.

For the justice system as a whole, Dean suggests that Professor Lazarus’ study, if heeded by the Court, will help increase the institutional integrity of the court to the extent that it prompts “modest reforms” that lead to the elimination of what Dean describes as “secret editorial (and occasionally more than editorial) fixes.”

Labor Department announces new overtime rule for home-health workers

The Wall Street Journal reports this morning that, as of Jan. 1, 2015, home-health workers (sometimes called personal care aides or certified nursing assistants) will no longer be exempt from the minimum-wage and overtime provisions of the Fair Labor Standards Act of 1938.  Labor Department Adds Protections for Home-Health-Care Workers – WSJ.com

In 1974, Congress extended FLSA protections to many domestic workers; however, aides providing “companionship services” for the elderly, sick, or disabled were, like teenage babysitters, specifically exempted from the protections provided by the law until now.  Even though such workers help to feed, dress, bathe, and provide essential care and services for their clients, often enabling those receiving such care to remain in their own homes rather than move into an institutional setting, because the workers provide those services in private homes and not, for example, in a hospital or nursing home, regulations before the current did change did not allow these workers to qualify for overtime pay.  In fact, in 2002, When Evelyn Coke sued her employer for overtime wages after working long hours, round the clock, and argued that the law was not intended to discriminate against her profession in this manner, the United States Supreme Court, on June 11, 2007, disagreed and said that, in fact, this was exactly what the law provided… although adding that the Department of Labor (DOL) could revisit the matter to bring home-care workers under the protections of the FLSA if it wished to do so. (Read the Court’s full opinion at Long Island Home Care v. Evelyn Coke.)

At last, this is what the DOL has done.

While the new ruling means that the two million or so home-health workers, a large number of whom are women and minorities, will now be paid time-and-a-half for time worked over 40 hours per week, the effect of the nominal pay raise will almost certainly have a broader impact on the home-care industry, projected to rise to 3.2 million workers by 2020: home-care companies, many of which run on slender profit margins, may cut hours and hire more aides to avoid paying overtime (and perhaps benefits) to remain competitive; base pay in the industry may fall to minimum wage in order to cut costs so that employees’ net wages do not increase when overtime is factored in; more and more workers may choose to become independent (and therefore unsupervised and difficult to regulate) agents so that they can work longer for less money; or the cost to the elderly, sick, and disabled may simply rise.

In light of the foregoing, there is a real question as to whether this fundamentally fair policy change will end up helping or hurting those it is intended to assist.  The Wall Street Journal quotes both Sen. Tom Harkin (D., Iowa), Chair of the Senate Health, Education, Labor and Pensions Committee and Rep. John Kline (R., Minn.), Chair of the House Education and the Workforce Committee to sum up the divide in Congress over the rule.  It may be, however, that both are right, and the policy shift is at the same time “a long overdue step to provide basic fairness for those who support and care for some of our most vulnerable citizens,” while at the same time it “will raise costs and limit access to in-home care for vulnerable Americans.”

It is a truism that the only constant in business is change itself.  If you are facing regulatory changes and need advice, the employment lawyers at Briskin, Cross & Sanford advise privately held companies, including home healthcare companies, on all aspects of their business.  Whether you are an established company dealing with the impact of new regulations or an entrepreneur starting out on your own, we will be happy to discuss solutions to the legal challenges your business faces.

Batteries, Babies, and Discrimination: Congress changes the meaning of “sex”

Johnson Controls manufactured batteries, which exposed its factory workers to lead.  From 1982 to 1991, Johnson Controls specifically excluded women capable of becoming pregnant from working in any position requiring exposure to lead citing concern for the women’s future, potential, unborn children.  Johnson Controls did not apply this exclusion to men of childbearing age.  A class of women challenged Johnson Controls’ policy, arguing that the policy discriminated against women on the basis of sex and violated Title VII of the Civil Rights Act of 1964.

Johnson Controls’ policy is arguably understandable if the point of the policy was to protect women and their potential children. Any such concern for Johnson Controls’ female employees’ reproductive health did not make this policy legal, however, and in 1991, the Supreme Court found this policy violated Title VII because it discriminated against women based solely on their sex.

Wait a minute…. when did discrimination based on sex extend to a woman’s unborn child?  Until 1978, the prohibition of discrimination based on a person’s sex meant just what it appears: an employer could not refuse to hire or decide to fire an employee just because, well, that employee happened to be a woman or a man.  But in 1978, “sex” took on a whole new meaning when Congress passed the Pregnancy Discrimination Act, which broadened the definition of “sex” to include pregnancy, childbirth, or related medical conditions. The Pregnancy Discrimination Act further requires that pregnant women be treated the same for all employment-related purposes as the employer would treat any other employee similar in his or her ability or inability to work.

So where does this leave employers?  The practical implication of Johnson Controls’ purported good intentions is that employers cannot make any decision based on sex, including decisions intended to protect either women or men.

For any questions regarding whether a workplace policy in your company discriminates based on sex, or for a review of potential policies affecting your employees, feel free to call the employment lawyers at Briskin, Cross & Sanford, LLC.