July 22, 2013 — A federal judge on Friday granted retail chain Hobby Lobby a preliminary injunction against the federal contraceptive coverage rules, Reuters reports. The ruling gives the Department of Justice until Oct. 1 to decide whether to appeal a June 27 ruling from a federal appeals court to let Hobby Lobby challenge the mandate on religious grounds (Stempel, Reuters, 7/19).
The contraceptive coverage rules, which are being implemented under the Affordable Care Act (PL 111-148), require most employers to offer the coverage to their workers. Houses of worship are exempt from the requirement, and religiously affiliated not-for-profits are eligible for an accommodation that ensures they do not have to pay for or directly provide the coverage to their employees. As a for-profit business, Hobby Lobby is not eligible for an exemption or accommodation under the final rule (Women's Health Policy Report, 7/2).
Details of Friday's Hearing
U.S. District Judge Joe Heaton explained on Friday that the stay is justified because of "substantial" public policy issues involved in the case, the number of similar lawsuits and the size of the penalties Hobby Lobby would incur for failing to comply with the rules.
"There is a substantial public interest in ensuring that no individual or corporation has their legs cut out from under them while these difficult issues are resolved," Heaton said during Friday's hearing (Reuters, 7/19).
Heaton's ruling follows a June 27 decision by the 10th U.S. Circuit Court of Appeals that determined the company's religious-based arguments appear to hold merit. "Because the contraceptive-coverage requirement places substantial pressure on Hobby Lobby and Mardel [another plaintiff in the case] to violate their sincere religious beliefs, their exercise of religion is substantially burdened," the circuit court judges concluded (Women's Health Policy Report, 6/28).
Heaton expressed surprise that the appeals court seemed to extend a person's constitutional religious exercise rights to businesses, adding that it was in the public's interest to issue an injunction in order to resolve "substantial unanswered questions" (Talley, AP/ABC News, 7/19).
Kyle Duncan -- general counsel with the Becket Fund for Religious Liberty and lead attorney for Hobby Lobby -- said in a statement the ruling "is a major victory for not only Hobby Lobby, but the religious liberty of all for-profit businesses." According to the Becket Fund, 43 lawsuits have been filed challenging the contraceptive coverage rules, and nine of the 12 for-profit businesses challenging the law that have heard rulings on the merits of their claims have been granted injunctions.
The Department of Justice did not immediately comment (Bunis, CQ HealthBeat, 7/19).