December 27th, 2012
07:20 PM ET

Hobby Lobby faces millions in fines for bucking Obamacare

By Eric Marrapodi, CNN Belief Blog Co-Editor
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Washington (CNN)– Craft store giant Hobby Lobby is bracing for a $1.3 million a day fine beginning January 1 for noncompliance with the Patient Protection and Affordable Care Act, dubbed Obamacare.

The company opposes providing some contraceptives to employees through its company health care plan on religious grounds, saying some contraceptive products, like the morning after pill, equate to abortion.

After failing to receive temporary relief from the fines from the Supreme Court, Hobby Lobby announced late Thursday through its attorneys that it "will continue to provide health insurance to all qualified employees. To remain true to their faith, it is not their intention, as a company, to pay for abortion-inducing drugs."

In September, Hobby Lobby and affiliate Mardel, a Christian bookstore chain, sued the federal government for violating their owners' religious freedom and ability to freely exercise their religion.

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"All they're asking for is a narrow exemption from the law that says they don't have to provide drugs they believe cause abortions," Hobby Lobby attorney Kyle Duncan, a general counsel for the Becket Fund for Religious Liberty, told CNN affiliate KFOR in November. "Our basic point is the government can't put a corporation in the position of choosing between its faith and following the law."

The lawsuit says the companies' religious beliefs prohibit them from providing insurance coverage for abortion inducing drugs. As of August 2012, the Patient Protection and Affordable Care Act requires employer-provided health care plans to provide "all Food and Drug Administration approved contraceptive methods, sterilization procedures, and patient education and counseling for all women with reproductive capacity," according to the U.S. Department of Health and Human Services.

Churches and houses of worship are exempt from the regulation and a narrow exemption was added for nonprofit religious employers whose employees "primarily share its religious tenets" and who "primarily serve persons who share its religious tenets."

In the face of that opposition, the Department of Health and Human Services tweaked its original rule in February to require health insurers, not employers, to cover the cost of contraception coverage, reasoning that would prevent religious groups from having to finance such coverage. Critics have argued that exemption for nonprofits is far too narrow and a host of nonprofit religious groups have sued the administration over the regulations.

The Internal Revenue Service regulations now say that a group health care plan that "fails to comply" with the Affordable Care Act is subject to an "excise tax" of "$100 per day per individual for each day the plan does not comply with the requirement." It remains unclear how the IRS would implement and collect the excise tax.

The Oklahoma City, Oklahoma, based Hobby Lobby chain has more than 500 stores that employ 13,000 employees across 42 states, and takes in $2.6 billion in sales. The company's attorneys say January begins a new health care plan year for Hobby Lobby and that excise tax from the IRS would amount to $1.3 million a day.

Hobby Lobby is owned by CEO and founder David Green and members of his family. "The foundation of our business has been, and will continue to be strong values, and honoring the Lord in a manner consistent with biblical principles," a statement on the Hobby Lobby website reads, adding that one outgrowth of that is the store is closed on Sundays to give its employees a day of rest. Each year the company also takes out full-page ads in numerous newspapers proclaiming its faith at Christmastime and on Independence Day.

The store is not formally connected to any denomination, but the Green family supports numerous Christian ministries and is behind the Green Collection, one of the largest private collections of biblical antiquities in the world. The family plans to permanently house the collection in Washington at a museum set to open in 2016.

On Friday, attorneys for Hobby Lobby petitioned the Supreme Court to intervene and provide temporary relief from the the fines until the case was decided by the U.S. 10th Circuit Court of Appeals in Denver.

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Wednesday evening, Justice Sonia Sotomayor, who handles emergency appeals from the 10th Circuit Court, said the company failed to meet "the demanding standard for the extraordinary relief," and that it could continue to pursue its challenge in lower courts and return to the higher court, if necessary, after a final judgment.

"Hobby Lobby will continue their appeal before the 10th Circuit. The Supreme Court merely decided not to get involved in the case at this time," Duncan said in a statement.

A spokesperson for the Justice Department declined to comment on the high court's move.

White House officials have long said they believe they have struck an appropriate compromise between religious exemptions and women's health. The White House has not commented specifically on the Hobby Lobby case.

"It's just so sad that Hobby Lobby is facing this choice. What company, even a successful family owned business like Hobby Lobby, how can they afford the government $1.3 million in fines every day? It's just really absurd that government is not giving on this," said Maureen Ferguson, a senior policy adviser for the Catholic Association. Religious liberty groups like hers are watching the Hobby Lobby case closely.

"I am optimistic that these cases will eventually snake their way back up to the Supreme Court and given a full hearing on the merits of the case, I am confident that the Supreme Court will rule in favor of religious liberty," Ferguson said. "But in the meantime there is serious damage being done to businesses like Hobby Lobby and nonprofit charitable organizations."

The Hobby Lobby case is just one of many before the courts over the religious exemption aspects of the law. The case represents by far the biggest for-profit group challenging the health care mandate.

After this piece of the law went into effect in August, religious nonprofits were given "safe harbor" of one year from implementing the law. "In effect, the president is saying we have a year to figure out how to violate our consciences," Cardinal Timothy Dolan, the Archbishop of New York, said in January when the administration announced the move.

Dolan's New York Archdiocese won a victory this month in its legal battle against the administration and the mandate. In May it sued the government in federal court in Brooklyn over the mandate, saying it "unconstitutionally attempts to define the nature of the church's religious ministry and would force religious employers to violate their consciences."

The government moved to have the case dismissed. On December 4, Judge Brian M. Cogan denied the government's motion to dismiss the case, saying the government's promise of changes to how it will implement the law were not enough to merit dismissal. "There is no, 'Trust us, changes are coming' clause in the Constitution," Cogan wrote in in his decision to let the case proceed.

UPDATE: Hobby Lobby's $1.3 million Obamacare loophole

- CNN Belief Blog Co-Editor

Filed under: Belief • Christianity • Church and state

soundoff (5,627 Responses)
  1. Kunst

    If you don't believe in abortion or contraception, don't do them. You have no right to dictate your beliefs to your employees. They do a job for pay. They didn't sell you their freedom.

    December 28, 2012 at 12:21 am |
    • Bootyfunk

      very well said.

      December 28, 2012 at 12:25 am |
    • Athy

      Brilliant and to the point.

      December 28, 2012 at 12:45 am |
    • Jesus

      And although you are right, the main issue here isn't religious freedom. It's about a corporation being able to follow rules & laws. if they can't follow the law, whatever the law may be, they will be punished.

      December 28, 2012 at 11:41 am |
    • David Garza

      And nobody forces the employees to work there. Great argument, huh?

      December 28, 2012 at 7:12 pm |
  2. denver

    Corporations are not people and do not enjoy religious liberty as described by the First Amendment. I really don't understand why this is so hard to grasp. The owners of Hobby Lobby can go to any church they like and pray to any god they choose but the corporation Hobby Lobby can't ignore federal laws.

    Some of the time I'm not sure if this subset of American Christians are really this dumb, or if they simply think they can get away with anything if they profess their faith stridently enough.

    December 28, 2012 at 12:20 am |
    • David Garza

      If "corporations aren't people" and it's no big deal for force them to comply, then wait until Hobby Lobby decides shut down rather than provide morning after abortion pills through their employee insurance plan....thousands of employees will be out of work. But it's OK because they aren't people, either. By your definition they are part of the soulless corporation.

      December 28, 2012 at 7:11 pm |
  3. Kublie

    The government is telling us to do more and more today and if we don't like it there is no recourse. When it goes against our conscience or our faith we should not have to be required to do it. And that includes all faiths not just Christianity. This is not the only problem with Obamacare.

    December 28, 2012 at 12:15 am |
    • denver

      You're simply wrong. We're a society of civil laws. Your conscience has nothing to do with it. Pray to whoever you want, but obey our laws.

      December 28, 2012 at 12:21 am |
    • ram

      That doesn't even make sense. So if it goes against my conscience to avoid running over you I should just be allowed to do it? If you don't believe in your heart that women should be allowed c-sections because you feel it isn't God's way, then you get to let someone die if you are in a position of choosing that? that doesn't even make sense. You don't want to use it just don't use it. There you go. Ethical dilemma solved! But that is a for-profit business and not some church, so they don't get to choose what medicines their workers get.

      December 28, 2012 at 12:30 am |
    • Jesus

      Well my faith says murder is ok. But we have this thing called LAWS in the country, and no matter how much I may or may not want to murder, and no matter if my faith says it's ok or not, it's still AGAINST THE LAW! Religion does not allow you to violate the law. Maybe God would be happier with Hobby Lobby if they followed the law instead of doing whatever they wanted

      December 28, 2012 at 11:43 am |
  4. Kev

    A concern I have is that since Hobby Lobby is not a church or church affiliated organization, but rather a for profit corporation, if Hobby Lobby does win out and can get away with not paying certain health costs due to their religious beliefs, just exactly where would the line be drawn? To what degree could an employer go to to not pay under the guise religious beliefs?

    December 28, 2012 at 12:12 am |
  5. Michael

    More taxes on them mean less taxes on the rest of us. I'm quite okay with allowing them to go this route.

    December 28, 2012 at 12:07 am |
  6. Ken Margo

    I don't read the bible. Is there anything in there about birth control?

    December 28, 2012 at 12:06 am |
    • Moham'd

      yes when you must marry your ugly widow sister-in-law !

      December 28, 2012 at 12:10 am |
  7. Jennifer

    Pick a plan that covers birth control(they all do), or pay full 18 maternity leave!!!!

    December 28, 2012 at 12:00 am |
  8. midwestmatt

    What if their religion suddenly opposes antibiotics? Or surgery? Or any other medical procedure?

    Their beliefs are their own but now they're pushing them off on their employees. What's next? They demand that their employees go to church? Or sign an oath that they're Christians?

    Typical right wing, conservative BS.

    December 28, 2012 at 12:00 am |
    • Joe Stenger

      Since when does "We won't pay for it' mean "you can't have it?"

      December 28, 2012 at 12:06 am |
    • mec

      What an amazingly short sighted complaint of what they are doing. Basically obamacare can come up with whatever medicine it decides is "good" and then everyone has to deal with it. It allows the government dictatorship rights to medications and forcing they get accepted. What if they released a med that's "One week later pill", or a "One month later pill" which is even more abortion-like? What if they release a suicide pill? It's extreme, but basically you put the government again in charge of morality when it comes to drugs. I applaud the company for standing up for what they believe. Mind you, it may cost them customers, and it may even cost them their company, but people have to stand up for what they believe regardless of what liberals want everyone to smile and swallow.

      December 28, 2012 at 12:10 am |
    • TheRationale


      Your response has the depth of a skillet. First of all, if you measure abortions and teen pregnancies against contraceptive use, you'll find that they significantly drop with contraceptive use. So much for wanting fewer "abortions." But put that aside. If you don't want to use it, you don't have to. Your employer should not dictate that your health insurance plan have holes in it. It's entirely not their place. It's absurd to think that Hobby Lobby as someone's employer has any say in their access birth control.

      December 28, 2012 at 12:24 am |
  9. Moham'd

    Workers MUST have the the right to pray 5 times daily at Hobby Lobby !!!

    December 28, 2012 at 12:00 am |
    • Moham'd

      And be fed only halal meat at Hobby Lobby's cafeteria

      December 28, 2012 at 12:01 am |
    • Moham'd

      And get interest free loans at Hobby Lobby

      December 28, 2012 at 12:01 am |
    • Ken Margo

      You can pray all you want. That doesn't cost money. Making people have kids they cant afford cost me money.

      December 28, 2012 at 12:01 am |
    • Moham'd

      I just want my religious rights protected just the same as Hobby Lobby's religious rights (wink wink)

      December 28, 2012 at 12:03 am |
    • Moham'd

      And I forgot to mention that my entrance way to Hobby Lobby building must face a certain direction too !

      December 28, 2012 at 12:05 am |
    • Ken Margo

      I understand what you're saying. You make a good point.

      December 28, 2012 at 12:05 am |
    • Moham'd

      Exactly. And my Wicca friend must have the right to burn that nice smelling candle at the office desk all day !!!

      December 28, 2012 at 12:08 am |
  10. ...

    You would think conservatives would be smart enough to support this, since maternity leave is extremely costly for businesses.

    December 27, 2012 at 11:57 pm |
  11. Tim

    The morning after pill is over the counter; it's called Plan B. You have to get it from a pharmacist, but you do not need a perscription. Insurance probably won't cover it; it costs between $10 and $70, depending on the area.

    December 27, 2012 at 11:55 pm |
    • ram

      And your point?

      December 28, 2012 at 12:33 am |
  12. Brian

    The Europeans went through these debates in the middle ages. They see religion as part of the problem. That's one reason they have universal care.

    December 27, 2012 at 11:52 pm |
  13. Extra Medium

    If the workers are allowed abortion pills, Corporations will lose the future supply of slaves !!

    December 27, 2012 at 11:52 pm |
  14. The Radical Secularist

    "Our basic point is the government can't put a corporation in the position of choosing between its faith and following the law."

    Corporations have faith?

    December 27, 2012 at 11:51 pm |
  15. Duh

    It's so easy to get pregnant that it's hardly a "gift from God." Religious nonsense.

    December 27, 2012 at 11:50 pm |
    • Atheism is not healthy for children and other living things

      Gays can't easily get pregnant so you are worng

      December 27, 2012 at 11:53 pm |
    • Duh

      I was speaking of how easily females can be. Or are you mentally incompetent?

      December 27, 2012 at 11:56 pm |
    • Atheism is not healthy for children and other living things

      Duh, don't you see my handle and tell my mental state, duh again.

      December 27, 2012 at 11:57 pm |
    • ...

      Oh, don't worry, I can tell your mental state all right.

      December 27, 2012 at 11:58 pm |
  16. Brian

    Some of these corporations should have a retroactive abortion.

    December 27, 2012 at 11:50 pm |
    • knightstorm


      December 27, 2012 at 11:51 pm |
    • ...

      Hobby Lobby will go down the tubes soon enough with that massive fine.

      December 28, 2012 at 12:00 am |
  17. Bill Maloney

    Let the Hobby Lobby go under.

    December 27, 2012 at 11:48 pm |
  18. K Brown

    Businesses are not allowed to have religious beliefs. That is a personal thing. A business is required to follow all laws pertaining to businesses and is no way being oppressed by that. You have personal rights to use or not use forms of birth control. Until we can separate humans from businesses we will continue to have these issues. The employer is providing health care coverage, not moral imperatives. I personally don't want my money funding wars, it's against my religion, I don't have any sympathy for their supposed feeling that they are having to pay for something that is against their beliefs. They already do it in many ways, this is just one that has huge ramifications for their employees.

    December 27, 2012 at 11:46 pm |
    • OOO

      And if the argument is that businesses can have personal beliefs, then you have just argued for getting businesses out of healthcare altogether and moving to universal healthcare.

      December 27, 2012 at 11:50 pm |
  19. lol??

    The drumbeat of the Socialists resonates with look it UP. "Definition of SOCIALISM

    : any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods
    a : a system of society or group living in which there is no private property
    b : a system or condition of society in which the means of production are owned and controlled by the state
    : a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done" ......."© 2012 Merriam-Webster, Incorporated".....So NOW WHAT, Bullies? Looked it up in the wrong place?????

    December 27, 2012 at 11:45 pm |
    • knightstorm

      take your bedsheet off, be a man...

      December 27, 2012 at 11:50 pm |
    • OOO

      OK, but what is your point? You sucessfully copied a definition with no logical conclusion drawn.

      December 27, 2012 at 11:52 pm |
    • midwestmatt

      None of what you copied and pasted happens in America.

      Everything single definition of socialism you noted is not occurring, and has not occurred, in the U.S.

      Epic fail.

      You come to CNN to complain because FOX shut their comment section down. I think it's time CNN followed FOX and shut down this so called discourse. It's the fools versus those that received an education.

      December 28, 2012 at 12:04 am |
    • lol??

      Matt, I must have a glitch with my computer. See if you can find this: http://www.dsausa.org/dsa.html

      December 28, 2012 at 12:11 am |
    • lol??

      Google on Socialism in America:............About 29,900,000 results (0.15 seconds)

      December 28, 2012 at 12:16 am |
  20. Dave

    Corporations are NOT PEOPLE. Just follow the law and practice your religion PERSONALLY. Do not try to foist your religious views on your employees or others via your corporation.

    December 27, 2012 at 11:45 pm |
    • Alan

      You do know in 2010 Obama helped corporations to have the same rights as regular individuals and it's also the reason election costs have sky rocketed....

      December 27, 2012 at 11:58 pm |
    • lol??

      from wiki:"...............The basis for allowing corporations to assert protection under the U.S. Consti tution is that they are organizations of people, and that people should not be deprived of their consti tutional rights when they act collectively.[5] In this view, treating corporations as "persons" is a convenient legal fiction......."

      December 28, 2012 at 12:00 am |
    • Tim

      Oh, but they are people in the eyes of the law; but people who cannot easily die or be imprisoned. They are designed to take the risk out of owning a business by placing the responsibility upon the business, not specific individuals. This whole capitalism vs. socialism debate is getting out of hand. America is not purely capitalist, and will never be totally socialist. There are too many saftey nets in place (many of them were created through laws) to protect businesses and their practices to be capitalist. Pure capitalism would have let banks fail during the savings and loans scandle, and in 2008. Socialism will never take a firm grip because of power major corporations, insurance conpanies, and banks have in our economy. This is not either good or bad, this is just how our country works at this time. There will always be a mixture. Neither is evil; these are economic philosophies; ideas. Ideas can only become evil through the practices of humans; however, our concepts of evil greatly differ across the world. If you respond to this, please keep hatred out of your words, that will not further the discussion and only make the response seem unqualified.

      December 28, 2012 at 12:11 am |
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About this blog

The CNN Belief Blog covers the faith angles of the day's biggest stories, from breaking news to politics to entertainment, fostering a global conversation about the role of religion and belief in readers' lives. It's edited by CNN's Daniel Burke with contributions from Eric Marrapodi and CNN's worldwide news gathering team.