Food firms battling Obamacare may benefit from Hobby Lobby ruling

By Jim Webster

© Copyright Agri-Pulse Communications, Inc.



WASHINGTON, July 9, 2014 - Food companies that sought exemption from provisions of the Affordable Care Act (ACA) may benefit from the recent Supreme Court's ruling in favor of Hobby Lobby.

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The high court ruled that requiring certain employers to pay for contraceptives to which they are morally opposed due to religious beliefs violates the 1993 Religious Freedom Restoration Act. The decision is a landmark in the debate over mandates regarding private companies' health care coverage required in the ACE, better known as Obamacare. 

The Supreme Court ruling said only “closely held” corporations with 50 or more employees can deny contraceptive coverage on religious grounds. Businesses with fewer than 50 employees are not covered by the ruling, because the health care law never required them to provide contraceptive coverage.

The owners of Eden Foods, an organic food company based in Clinton, Michigan, and the owners of Freshway Foods and Freshway Logistics - brothers Francis Gilardi Jr. and Philip Gilardi - hold similar beliefs as the owners of Hobby Lobby and own companies that qualify as “closely held” corporations. They filed a lawsuit in 2013, objecting to the Obamacare provision requiring them to provide certain contraceptives under their health care plans for employees. 

After it ruled in Hobby Lobby's case that the Obamacare provision violates federal law, the Supreme Court ordered other similar cases, including Eden Foods and Freshway Foods, to be reheard by lower courts. 

Eden Foods sued the Obama administration in 2013 over the health care provision, and it will now have its case reheard in the U.S. Sixth Circuit Court of Appeals, which had ruled that corporations do not have exemptions from the law based on religion. 

Freshway Foods, a fresh fruit and vegetable processor, and Freshway Logistics, which provides distribution services for Freshway customers, are based in Sidney, Ohio.

According to last year's Circuit Court opinion regarding the Gilardi brothers, they would have to pay a penalty of over $14 million per year, or go against their faith and provide the contraceptives in question. 

The American Center for Law and Justice (ACLJ) represents the Gilardi brothers. ACLJ Senior Counsel Ed White said the DC Circuit Court ruled last year that the Gilardi brothers as individuals were exempt from the law, but not their companies. After the circuit court issues a decision in light of the Hobby Lobby ruling, the case will go back to trial court, White said.

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