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The Supreme Court Is Building a Frankenstein Monster

The stage is set to determine whether the U.S. Supreme Court will expand its effort to out-do Dr. Frankenstein.

On November 26, 2013, the court decided to review the case of Hobby Lobby Stores, Inc. v. Kathleen Sebelius, Secretary of Health and Human Services. Hobby Lobby is seeking a religious exemption from providing health care coverage to its employees for contraception medicine under the 2010 Affordable Care Act (so-called "Obamacare," even though it is based on a law developed by Mitt Romney when he was governor of Massachusetts).

The 10th Circuit Court of Appeals ruled that Hobby Lobby Stores has rights to a religious exemption under the federal Religious Freedom Restoration Act, even though it is a corporation, not an actual person.

Congress passed the Religious Freedom Restoration Act (RFRA) in 1993, in response to a 1990 decision by the U.S. Supreme Court that denied unemployment benefits to members of the Native American Church who used peyote as part of their religious ceremonies. RFRA was tailored to protect Native American and all other religious practices from government infringement. RFRA says that the federal government "shall not substantially burden a person's exercise of religion" unless that burden is "the least restrictive means of furthering [a] compelling governmental interest."

Hobby Lobby takes the position that RFRA gives a corporation the same rights to religious freedom it does for individuals, and that that the corporation is "substantially burdened" by the contraceptive-coverage requirement of the Affordable Care Act. The 10th Circuit agreed with Hobby Lobby and overruled the federal district court, which held that even closely held family corporations like Hobby Lobby do not have "religious freedom."

In its ruling, the 10th Circuit conflated the views of Hobby Lobby's owners with the corporation itself. This ignored a basic legal principle: that corporations are entities separate from those who own them.

Humans create corporations precisely because of that principle. For example, perhaps the most important reason to create a corporation is that it limits the financial liability of the owners—including for taxes and civil judgments.

The separation between a corporation and its owners was recognized by the district court: "business corporations…do not pray, worship, observe sacraments or take other religiously-motivated actions separate and apart from the intention and direction of their individual actors." The owners may exercise religion, but not the corporations.

The U.S. Supreme Court has been expanding the "Constitutional rights" of corporations since its 1819 decision that protected the corporation of Dartmouth College against the state of New Hampshire. In that case, the court described a corporation as an "immortal being."

In 1886, the court allowed the Southern Pacific Railroad to claim "equal protection of the law" to challenge the California county of Santa Clara. There, the court described the corporation as a "metaphysical being" equal to a "man, woman, and child" and protected by "our blessed government."

Interestingly, for those who now claim that a corporation has "religious" rights, the 1886 court also said, "the metaphysical being, that is called a corporation, cannot feel." How can a "metaphysical entity," even if it is "immortal," have religion if it "cannot feel"?

The most recent—and perhaps most outrageous—decision in favor of "Constitutional rights" for corporations is the 2010 Supreme Court case of Citizens United v. FEC. That case held that "First Amendment protection extends to corporations." The court said that when a corporation gives money to a political campaign, it is doing the same thing as a human person who speaks out in favor of a candidate. The only thing missing is a decision that says corporations can vote.

It is not a foregone conclusion that the Supreme Court will further extend the rights of corporations. Two other courts of appeal have rejected the 10th Circuit reasoning. The 3rd Circuit rejected a corporation's religious claims under both RFRA and the First Amendment. The 6th Circuit said that corporations are not "person[s]' capable of 'religious exercise' as intended by RFRA."

On the other hand, as the 10th Circuit said, "We see no reason the Supreme Court would recognize constitutional protection for a corporation’s political expression but not its religious expression."

Two judges of the 10th Circuit, including the Chief Judge, criticized the majority's reasoning that Hobby Lobby is a "faith-based corporation": "The majority…does not cite to a single source in support of this new legal category of for-profit corporation. That is because it cannot. As far as I can determine, neither the United States Supreme Court nor any federal circuit court, until now, has ever used the phrase “faith-based company” …[or] recognized a for-profit corporation as having a 'religious mission.'"

The Hobby Lobby case gives the Supreme Court a chance to step back from its long march toward making corporations equal to human beings. If it doesn't do that, it will take another step toward what Dr. Frankenstein was doing: trying to create a living being, and in the process creating a monster. (Ironically, Frankenstein's monster did have feelings and lamented its creation.)

Peter d’Errico graduated from Yale Law School in 1968. He was Staff attorney in Dinebeiina Nahiilna Be Agaditahe Navajo Legal Services, 1968-1970, in Shiprock. He taught Legal Studies at the University of Massachusetts, Amherst, 1970-2002. He is a consulting attorney on indigenous issues.