Supreme Court Presages Broad Religious Exemptions to State and Local Non-Discrimination Provisions

Supreme Court Presages Broad Religious Exemptions to State and Local Non-Discrimination Provisions

Fulton v. City of Philadelphia, Pa., 141 S. Ct. 1868 (2021).

I. Introduction

In Fulton, both the district court and court of appeals held in favor of the defendants, citing Employment Division v. Smith as controlling precedent regarding “neutral laws of general applicability.” Fulton v. City of Philadelphia, 320 F. Supp. 3d 661, 704 (E.D. Pa. 2018), aff’d, 922 F.3d 140 (3d Cir. 2019), rev’d and remanded sub nom. Fulton v. City of Philadelphia, Pa., 141 S. Ct. 1868 (2021); Fulton v. City of Philadelphia, 922 F.3d 140, 147 (3d Cir. 2019), rev’d and remanded sub nom. Fulton v. City of Philadelphia, Pa., 141 S. Ct. 1868 (2021). Unhappy with both outcomes, the plaintiff appealed to the Supreme Court, arguing that the City of Philadelphia’s non-discrimination requirements burdened its free exercise of religion. Fulton, 141 S. Ct. at 1874. The plaintiff demanded a full reconsideration of Smith. Id.

Fulton v. City of Philadelphia, Pa. presages broad expansions to religious exemptions to state and local non-discrimination provisions, especially those that protect the LGBTQ community.

In its Fulton opinion, the Supreme Court departed dramatically from the lower courts’ reasoning, holding that Smith did not apply at all. Id. at 1881. In doing so, the Court sidestepped the plaintiff’s demand to reconsider Smith. See id.

However, the Supreme Court’s trajectory is clear: Six of the nine Justices are in favor of reconsidering Smith. See id. Three were not in favor of revisiting Smith here in Fulton. See id. at 1883. Yet, in a fiery concurrence, Justices Alito, Thomas, and Gorsuch bemoaned the Court’s hesitance to overturn Smith in Fulton and provided a comprehensive legal roadmap for doing so in a future opinion. See id. at 1883 (Alito, J., concurring).

II.      Background

A. Factual Background

The Department of Human Services of Philadelphia County, Pa. (“DHS”), is charged with establishing a foster care system “to address the well-being” of children who are “unable to remain in their own homes.” Fulton, 320 F. Supp. 3d at 669. To carry out its duty, DHS contracts with private foster care agencies, including Catholic Social Services (“CSS”). Id.

In November 2015, DHS and CSS entered into a services contract to define, in part, CSS’s role in providing for “general, kinship, and teen parent/baby resource home care.” Id. at 670. CSS received “significant public funds” for its work. Id. Under the contract, CSS screened, trained, and certified foster parents. Id. The contract contained two non-discrimination provisions: The services contract defined its own non-discrimination provision and incorporated the City’s Fair Practices Ordinance, which prohibited discrimination in public accommodations based on sexual orientation. Fulton, 922 F.3d at 148.

On March 9, 2010, a reporter contacted DHS Commissioner Cynthia Figueroa, alleging that two foster care providers, including CSS, “had certain policies of refusing same-sex couples.” Fulton, 320 F. Supp. 3d at 672. After a discussion with the reporter, Commissioner Figueroa contacted CSS, as well as other faith- and nonfaith-based agencies to determine their policies regarding certifying same-sex couples. Id.

Figueroa spoke with CSS Secretary and Executive Director James Amato, who explained that based on “the teachings of the Catholic Church,” CSS would not “certify same-sex couples as prospective foster parents,” nor provide same-sex couples “with a home study as part of a same-sex couple’s application for adoption.” Id. By contrast, CSS would provide a home study for LGBTQ individuals “committed to living single.” Id.

On March 15, 2018, after an in-person meeting with Amato and CSS’s legal counsel, Figueroa decided that it was in the best interest of foster children to stop referring them to CSS until she could look more closely at the agency’s policies. Id. at 673. The same day, the Philadelphia City Council passed a resolution authorizing the Committee on Public Health and Human Services to “investigate [DHS] policies on contracting with social services agencies that either discriminate against prospective LGBTQ foster parents and allow non-LGBTQ foster parents to discriminate against children.” Id.

In the meantime, DHS and the City of Philadelphia offered CSS two different renewal contracts so CSS could continue providing uninterrupted support to foster children and families. Id. at 674. The first proposed to renew CSS’s contract with the same terms as its original agreement with the City but required that CSS stop discriminating against LGBTQ couples. Id.  Under the second proposed contract, some form of financial support would still be provided to CSS, even if CSS could not agree to certify same-sex couples. Id. at 674-75.

Even so, CSS refused both, and on May 17, 2018, CSS and three foster families (collectively “CSS”) filed suit in the U.S. District Court for the Eastern District of Pennsylvania (Philadelphia) against the City of Philadelphia, DHS, and the Philadelphia Commission on Human Relations (collectively “DHS”). Id. at 668.

B. Procedural Background

CSS’s initial complaint asserted sixteen causes of action, including “Defendants’ alleged violations of Plaintiff’s religious . . . rights.”1 Id. On June 5, 2018, CSS filed a motion for a preliminary injunction to compel DHS to resume referrals to its foster program. Id. Because CSS’s contract with DHS was scheduled to expire on June 30, 2018, the district court agreed to an expedited briefing timeline. Id.

On July 18, 2018, the district court declined to grant CSS’s request for a preliminary injunction. Id. at 704. Here, the court found that both DHS’s services contract and the Fair Practices Ordinance incorporated into the contract were neutral and generally applicable under Smith. Id. at 682-83. The court concluded that both contract provisions were neutral, citing lack of evidence that either was “drafted or enacted” with discriminatory intent. Id. at 683. Further, the court concluded that DHS applied the contract provisions neutrally given that DHS “would not permit any foster agency under contract, faith-based or not, to turn away potential foster parents for the foster parents’ characteristics.” Id. at 684. Because the court deemed both contract provisions neutral and generally applicable under Smith, the court then applied rational basis review to determine whether DHS’s non-discrimination provisions were rationally related to a legitimate interest. Id. at 703-04.

Here, CSS claimed that DHS had “targeted CSS for religious reasons,”2 but the court dismissed the argument, citing “insufficient evidence” of religious animus in the record. Id. at 686, 690. On the contrary, the court found that DHS provided “at least six permissible governmental objectives . . . furthered by seeking CSS’s compliance with the services contract.” Id. at 704-05. The court concluded that the contract, “as applied by Defendants . . . would likely survive rational basis review.” Id. at 686. Ultimately, the court declined to grant CSS’s request for a preliminary injunction, citing DHS’s “manifold,” legitimate government and public interests. Id. at 703-04.

On appeal, the third circuit affirmed unanimously. Fulton, 922 F.3d at 147. Like the district court, the court of appeals found that Smith applied because DHS’s contract provisions were neutral and generally applicable. Id. The court found that the plaintiffs’ religious views did not merit an exception from these non-discrimination policies. Id. Consistent with the district court, the court of appeals declined to apply strict scrutiny because CSS “failed to make a persuasive showing that the City targeted it for its religious beliefs, or is motivated by ill will against its religion, rather than sincere opposition to discrimination on the basis of sexual orientation.” Id.

Again, the plaintiffs appealed. The Supreme Court granted certiorari on February 24, 2020. Fulton v. City of Philadelphia, Pa., 140 S. Ct. 1104 (2020).

III. Analysis

The Supreme Court considered only whether DHS’s non-discrimination policies violated CSS’s alleged free exercise right to discriminate against same-sex couples. Fulton, 141 S. Ct. at 1874. Here, the Court declined to apply Smith, concluding that DHS’s non-discrimination policies were not neutral and generally applicable because they provided for a system of individualized exemptions. Id. at 1877. The Court concluded that Sherbert applied instead. Id. Under Sherbert and other Supreme Court decisions—which were all primarily related to unemployment issues—the government may not refuse to grant an exception based on “religious hardship” without a compelling reason. Id. Here, DHS’s services contract with CSS granted DHS’s commissioner “sole discretion” over exceptions to the non-discrimination policy. Id. at 1878.

DHS argued that the citywide Fair Practices Ordinance, as incorporated into the contract, applied to all “public accommodations,” including CSS. Id. at 1881. The district court had already concluded that CSS qualified as a public accommodation. Id. Unlike the contract itself, the Fair Practices Ordinance did not provide for any exceptions to its non-discrimination policy, and hence should trigger Smith. Id. However, the Supreme Court dismissed the district court’s finding that the lower court did “not take into account the uniquely selective nature of the [foster care] certification process.” Id. Therefore, the Court concluded both the contract provisions and the City’s Fair Practices Ordinance triggered Sherbert rather than Smith. Id. Unlike rational basis under Smith, under Sherbert, courts apply strict scrutiny. Id. This test determines whether the government action at issue was narrowly tailored to fulfill a compelling interest. See id. at 1877.

To survive strict scrutiny, DHS asserted “that its non-discrimination policies serve[d] three compelling interests: maximizing the number of foster parents, protecting the City from liability, and ensuring equal treatment of prospective foster parents and foster children.” Id. at 1881. The Court characterized the city’s justifications as “broadly formulated interests” and insufficient to deny CSS an exception to its contractual non-discrimination clause. Id.

The Court concluded that “[t]he refusal of Philadelphia to contract with CSS for the provision of foster care services unless it agrees to certify same-sex couples as foster parents cannot survive strict scrutiny and violates the First Amendment.” Id. at 1882. The Supreme Court unanimously reversed the court of appeals and remanded the case for further proceedings consistent with its opinion. Id.

IV. Implications

The Supreme Court offers a relatively terse consideration of the issue before it. See id. at 1868. More interesting than the opinion itself are two concurrences, both of which urge the Court to reconsider Smith once and for all. Id. at 1882-83. To summarize, six of the nine Justices agree that Smith should be overruled. Id. Three—Justices Barrett, Kavanaugh, and Breyer—indicated that a workable alternative to Smith must be identified before doing so. Id. Three—Justices Alito, Thomas, and Gorsuch—indicated that the Court should have overruled Smith in Fulton, not only because of the “dangers,” Smith poses to free exercise, but because a workable standard to replace Smith already exists: the pre-Smith standard requiring that any “law that imposes a substantial burden on religious exercise can be sustained only if it is narrowly tailored to serve a compelling government interest.” Id. at 1883, 1924.

The Justices’ sweeping concurrence posits that the Court should carve out broad free exercise exemptions for any religious conduct, even if the conduct is burdened only incidentally by government action. Id. They argue, in part, that religious liberty should be valued higher than other rights, including the right to non-discrimination, because religious liberty is enshrined in the First Amendment. See id. at 1888. By contrast, non-discrimination rights spring from the Fifth and Fourteenth Amendment’s Due Process clauses. See id. The court of appeals seemed to anticipate the ramifications of such a world in its opinion:

CSS’s theme devolves to this: the City is targeting CSS because it discriminates against same-sex couples; CSS is discriminating against same-sex couples because of its religious beliefs; therefore the City is targeting CSS for its religious beliefs. But this syllogism is as flawed as it is dangerous. It runs directly counter to the premise of Smith that, while religious belief is always protected, religiously motivated conduct enjoys no special protections or exemption from general, neutrally applied legal requirements. That CSS’s conduct springs from sincerely held and strongly felt religious beliefs does not imply that the City’s desire to regulate that conduct springs from antipathy to those beliefs. If all comment on religiously motivated conduct by those enforcing neutral, generally applicable laws against discrimination is construed as ill will against the religious belief itself, then Smith is a dead letter, and the nation’s civil rights laws might be as well.

Fulton, 922 F.3d at 159.

Justices Alito, Thomas, and Gorsuch are more than ready to overturn Smith, evidenced by their thorough consideration of stare decisis factors which would justify overruling precedent. Fulton, 141 S. Ct. at 1912.

V. Conclusion

Fulton v. City of Philadelphia, Pa. represents the culmination of a line of Supreme Court opinions justifying, or calling for the justification of, discriminatory acts in the name of free exercise of religion. See, e.g., Hosanna-Tabor Evangelical Lutheran Church & Sch. v. E.E.O.C., 565 U.S. 171 (2012) (holding that questions regarding “ministers” are “exclusively ecclesiastical questions”), Burwell v. Hobby Lobby Stores, Inc., 573 U.S. 682 (2014) (holding that business owners can invoke religious beliefs to deny contraceptive care in employee health insurance plans), Our Lady of Guadalupe Sch. v. Morrissey-Berru, 140 S. Ct. 2049 (2020) (holding that teachers at a Catholic school could not sue for employment discrimination). The current Supreme Court is poised to overturn Smith as soon as the opportunity arises. Fulton, 141 S. Ct. at 1888. Yet, legal scholars are apprehensive of overturning Smith in favor of a broad “free-exercise right to flout laws that protect other people,” which “would entangle judges in endless claims about which religions deserve this special treatment[.]Smith demands that religious individuals “follow the rules that apply to everyone.” This is also called “equality.”

*Landing image by Elyssa Fahndrich on Unsplash

1 This case summary focuses on CSS’s free exercise claim, as the Supreme Court deals exclusively with this claim in its opinion.

2 Here, CSS claimed that the City of Philadelphia showed “ill will” toward religion, like in Masterpiece Cake Shop and Lukumi. The court of appeals would later be unequivocal: “The evidence CSS offers of religious bias or hostility appears significantly less than what was present in Lukumi or even in Masterpiece.” Fulton, 922 F.3d at 148.

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