An expert in insurance and constitutional law examines the integral role your religious organization plays in your community and how changing laws can affect you and your mission.
Attorney
Leader of Insurance and
Reinsurance Working Group
Co-Leader of Litigation Team
Godfrey & Kahn, S.C.
How do cases on same-sex marriage and gender identity make it to the U.S. Supreme Court?
Friedman: The Court tends to look at how things are playing out politically and socially in the states before it takes up an issue. It tends to wait until lower courts — whether the state supreme courts or federal circuit courts — have looked at an issue, and have come out on opposite sides of that issue. Once a state Supreme Court and a federal court disagree, or when two federal circuit courts disagree, then the Court looks at an issue.
What case determined the same-sex marriage ruling?
Friedman: On June 26, 2015, the Supreme Court issued its decision in Obergefell v. Hodges, which declared that same-sex couples can marry nationwide. The Court also said that any law limiting that right is unconstitutional and void. There were 13 states that had recently enacted legislation that defined marriage solely as a union between one man and one woman that were directly affected.
What subjects were addressed — and what subjects were not addressed — with this ruling?
Friedman: The Court decided that states are required to license marriages of same-sex couples. Furthermore, states are required to recognize the marriages of same-sex couples that were licensed in other states. Any laws to the contrary are unconstitutional under the U.S. Constitution.
The Court did not address whether members of the clergy are required to perform same-sex marriages. It has not yet looked at whether the Obergefell decision has a direct impact on existing anti-discrimination or public accommodation laws, and it hasn’t looked at any impact Obergefell may have on existing insurance coverages and claims under insurance.
What is the likelihood of a change in the law?
Friedman: Obergefell is likely to be the law for quite some time. The President, for example, has no ability to change the Supreme Court’s interpretation of the U.S. Constitution, and neither can Congress. The Supreme Court is the final arbiter on the interpretation of the U.S. Constitution. It would take either a constitutional amendment through a Constitutional Convention, or an amendment when it comes to the states, to change the law at this time.
Changes in the membership of the Supreme Court can have an influence on decisions of constitutional magnitude, but it’s unlikely any change in the near future would affect Obergefell.
What areas of risk or potential claims exist for churches?
Friedman: A claim could certainly arise from a request to perform a marriage ceremony for a same-sex couple. While they may have Obergefell on their side, if the officiant — a minister for example — refused to perform that ceremony, he or she certainly would have protections under the free exercise clause of the First Amendment to the U.S. Constitution or under federal law, particularly the Religious Freedom Reformation Act, or RFRA. So, while there could be a claim, there certainly are some strong defenses.
On the flip side, it’s also possible that a minister who was to perform a ceremony for a same-sex couple may face a potential breach of fiduciary duty claim if his or her congregation felt that the decision of the minister were contrary to church doctrine.
It’s also possible that claims could arise out of either the permission or refusal to permit the use of the facilities of a religious organization for a same-sex marriage ceremony or reception. Whether that’s a valid claim or not, is probably based on whether the organization’s property is considered a place of public accommodation.
Finally, religious organizations could potentially face claims — or, at least, face some risk — when they make decisions about whether to provide employment benefits for a same-sex spouse of an employee of the religious organization.
How have states responded to these potential risks
and claims?
Friedman: Some states have actually tried to challenge at the state level the U.S. Supreme Court’s decision, claiming they have a right to do so under federalism or states’ rights. There is legislation pending in Mississippi called the “Religious Liberty Bill” that would not go quite so far as to try to overturn Obergefell, but it would provide protections against liability for discrimination based on religious beliefs. For example, if a minister chose not to perform a same-sex marriage ceremony, or if a florist chose not to sell flowers for a same-sex wedding, this legislation would protect those individuals who are exercising their religious beliefs.
“The right of same-sex couples to marry is the law in the United States. It is unsettled whether same-sex couples have a right to religious marriage ceremony. Finally, it is unsettled whether same-sex couples have a right to use facilities and services for their weddings if the vendors or the owners of the facilities object on religious grounds.” — James A. Friedman
Some jurisdictions have gone the other direction. They not only are comfortable with the U.S. Supreme Court’s decision in Obergefell, but they have made a decision that they will incorporate protections of same-sex marriage in their own laws. The state of Nevada has passed legislation to that effect.
In conclusion, what are some established knowns about same-sex marriage?
Friedman: The right of same-sex couples to marry is the law in the United States.
It is unsettled whether same-sex couples have a right to a religious marriage ceremony.
Finally, it is unsettled whether same-sex couples have a right to use facilities and services for their weddings if the vendors or the owners of the facilities object on religious grounds.
What occurred in the case surrounding transgender law?
Friedman: First, there are the federal laws. Title IX of the Education Amendments of 1972, passed by Congress, signed by the President, prohibits gender discrimination in education. President Obama — in particular, his Department of Justice and Department of Education — issued written interpretations of Title IX that prohibit discrimination based on a student’s gender identity. That started quite a ruckus.
A transgender student in Virginia, who in his court pleadings goes by the initials GG, sued his school board for the right to use the school bathrooms that aligned with his gender identity rather than those which aligned with his birth certificate gender. Subsequently, several states sued the federal government, challenging the Obama administration’s interpretation of Title IX for not only gender but also gender identity.
How did states respond to this?
Friedman: On the state and local level, a number of states and municipalities have passed laws or ordinances that prohibit discrimination based on gender identity. In North Carolina, there was HB 2, a statute that required people to use bathrooms consistent with the sex identified on the birth certificate as opposed to their gender identity. The U.S. Justice Department sued North Carolina when President Obama was in office.
What is the current state of Title IX?
Friedman: The Trump administration — again, the Department of Justice and Education — issued a new written interpretation of Title IX, withdrawing the support of transgender students to use bathrooms corresponding with their gender identity. The Justice Department also withdrew its lawsuit against the state of North Carolina challenging HB 2. Based on the new administration’s interpretation of Title IX, the states that had challenged it dropped their lawsuits. Most recently, North Carolina partially repealed HB 2, the bathroom law.
What was the response from businesses and corporations?
Friedman: More than 50 large corporations — including some very conservative companies like Walmart — filed a brief supporting GG’s challenge to his Virginia school district. Some of these companies have publicly stated their support their transgender employees and customers. The state of North Carolina has reported that it lost almost $200 million in revenue from canceled conventions, concerts and sporting events in 2016 alone based on HB 2.
A number of states started to follow North Carolina’s lead and pursued legislation against transgender people using the bathroom of their choice. Those states saw the repercussions in North Carolina and backed off.
Many businesses are trying to find a solution to this concern. They’re beginning to move to single-occupancy and unisex bathrooms to avoid issues on both sides of the transgender bathroom question.
What types of risks within religious organizations could this law pose?
Friedman: Permitting a transgender person to use the bathroom of his or her choosing could create problems for people who are against that concept. Similarly, prohibiting transgender persons from using the bathroom of his or her choosing could lead to claims.
Hiring, firing and disciplining employees based on transgender status could be a problem. There is no U.S. Supreme Court decision at this time saying that that is a violation of the U.S. Constitution, but it’s certainly possible that somebody could challenge it, either under the U.S. Constitution or under state and local laws. Refusing to permit the use of facilities outside of the educational institutions by transgender persons could lead to challenges, not based on Title IX but based on other federal, state and local anti-discrimination laws.
How can you avoid potential risks and claims?
Friedman: It’s important that religious organizations are familiar with not only the federal constitution and the U.S. Supreme Court’s decisions, but also with state and local anti-discrimination laws. You have an obligation to follow all federal, state and local laws. With respect to potential defenses, the 1st Amendment Free Exercise Clause is a very strong protection for religious organizations and people of faith, as is the federal statute I mentioned earlier: RFRA, the Religious Freedom Reformation Act.
A church also needs to understand whether it is likely to be considered a place of public accommodation. If all that religious organization does is have religious ceremonies and other religious gatherings, then it is unlikely that it is considered a place of public accommodation. However, if members of the public hold meetings there, or weddings, etc., then it’s possible that a church or other religious organization could be considered a place of public accommodation and could be subject to certain anti-discrimination laws.
Religious organizations should make sure that their bylaws and policies and other rules are consistent with church doctrine, and that they are enforced. Make sure to align the use of any facilities by members and/or non-members to these rules, bylaws and policies.
What should you do if you are faced with a question regarding same-sex marriage or transgender law?
Friedman: Document your decision-making, and the reasons you had for making the decision. You may want to consult with your attorney for difficult decisions.
Consult with your insurance professionals to see whether potential claims would be covered. Insurance coverage is always a very solid risk mitigation strategy. Make sure you understand the coverage that you do have. Understand that every claim and every coverage decision is unique, and each claim is based on the facts, and every coverage decision is based on the specific policy language applied to those facts.
What kind of coverage is available that can possibly mitigate these risks?
Friedman: Some policies provide coverage for legal defense only. Some of the claims that we’ve discussed would not create significant damages for the person who is potentially aggrieved, but they may seek injunctive relief or declaratory relief from a court. You may not be asked to pay much indemnity, but you will be forced to defend the lawsuit. There are insurance policies and riders for insurance policies that will provide defense coverage even if they do not indemnify against certain types of liability.
Take a look at any umbrella or excess policies. They don’t always just protect on a higher layer of coverage; sometimes they fill in gaps as well. Make sure you understand what you have in that regard.
Again, insurance coverage is critical, but there are many ways to potentially manage and mitigate risk.
— Reporting by Joyce Guzowski
