Is There Room for a Compromise in the Hobby Lobby Case?

A few questions from Justice Kennedy hint at a verdict that would find that Hobby Lobby does have religious-freedom rights, but that it nevertheless needs to abide by Obamacare.

Lyle Denniston of SCOTUSblog has a slightly different take on the Hobby Lobby oral argument than I do. In a column posted on Constitution Daily (the always-thoughtful blog of the National Constitution Center in Philadelphia), he suggests that Kennedy may be the key vote in the case. The Sphinx of Sacramento, he suggests, may vote that for-profit corporations may sue for violations of their Free Exercise rights, but that in this case, Hobby Lobby and the other plaintiffs have not demonstrated a “substantial burden” on their rights.  
Denniston is someone whose ideas should be taken with the utmost seriousness. He has spent 54 years in the Supreme Court press room and knows more than almost anyone living about how cases arise and how they are resolved.  He was the only colleague who, immediately after the “train wreck” argument over the Affordable Care Act, confidently predicted that the Court would uphold the individual mandate.
From the point of view of the ACA, Denniston’s analysis is more optimistic than my own, which I posted Tuesday. It seemed to me that Kennedy (alone among the Court’s conservatives) displayed some sympathy for the employees who will be deprived of some of their statutory health-insurance benefits if Hobby Lobby wins, but I thought his question to Solicitor General Donald Verrilli Jr. (could a for-profit corporation sue if a new law “forced [it] in principle to pay for abortions”?) and Verrilli’s answer (“[U]nder our theory . . .  the for-profit corporation wouldn't have an ability to sue”) was likely to have settled the case in Kennedy’s mind.
Denniston astutely points to comments Kennedy made questioning whether the “contraceptive mandate” is a “mandate” at all. Under the ACA, Hobby Lobby or any other corporation can choose not to provide health insurance; that choice triggers a requirement to pay a $2,000 per employee tax.
(Representing Hobby Lobby, Paul Clement called this a “penalty”; Justice Sonia Sotomayor jumped in to correct him: “It's called a tax.” The Chief Justice, whose vote saved the ACA in 2012 over precisely this issue of names, brought down the house when he chimed in, “she’s right about that.”)
Isn’t the tax, Kennedy asked, roughly comparable to the cost of providing health insurance?  Clement pointed out that the company would then have to pay higher wages so that employees could finance their own health insurance.  Financially, Kennedy suggested, that might still be a “wash” for the employer.
From that point of view, the “mandate” might not be a burden, or if it is one, not a “substantial” one. I personally think that the ACA requirement is not a “substantial burden,” for a different reason. As a matter of Supreme Court precedent, when use of funds for a religiously objectionable purpose comes out of the “the genuinely independent and private choices” of others, there is no burden on the objector. That precedent arises under the Establishment Clause, but the logic is the same—and Hobby Lobby’s claim that it can be excused from “facilitating” those independent decisions should fail.  (The redoubtable Ed Whelan of National Review Online, by the way, called this argument “badly confused” a few weeks ago. I deeply resent this—I paid a lot for my law school education, and my brilliant, hardworking professors confused me extremely well.)
I think that the coverage requirement is clearly constitutional, but an opinion like the one Denniston imagines would clearly be better than a broad statement of corporate Free Exercise rights against any involvement in what Clement called “religiously sensitive” subjects. That would be especially true if it was coupled with a limitation of the corporate right to family held “close” corporations, as Roberts suggested from the bench. (Even Clement admitted that Exxon might have trouble demonstrating religious sincerity.)

Kennedy was the only conservative Justice who showed even the slightest awareness that the case concerned the rights of actual human beings at all.  Justice Antonin Scalia, interpreting the Religious Freedom Restoration Act broadly, suggested that the statute did not allow the Court to "balance the interest of the religious objector against the interest of other individuals."

Clement’s argument obliterated the employees as anything but, in essence, thieves.  He compared the contraceptive-coverage requirement to a statute in which “Congress comes in and says I have to give all of my books, including all of my Bibles, to you.” In that metaphor, contraception is something being taken from the employers, rather than compensation being paid to the employees for their labor. In addition, contraceptive coverage, like a Bible, has no meaning but a religious one. That it might mean better health, or even life and death, to the covered employee is simply irrelevant.

The valence of this Court is so far right that this kind of comparison doesn’t get called out. Any advocate who tried such a dismissive comparison of the religious-freedom rights of Hobby Lobby, however, would be cut off at the knees.