United States: Religious Institutions Update: December 2015

Lex Est Sanctio Sancta

Nathan A. Adams IV is a Partner in our Tallahassee office.

Timely Topics

Captive insurance companies can be a win-win for organizations with excellent claim records that would rather accrue their insurance premiums than pay them to a third-party insurer. Put simply, captive insurers are insurance companies formed by the insured with the specific objective of insuring risks emanating from the parent company or group of companies. The advantages can be substantial: For example, after "endowing" the captive insurer, the parent no longer has to make annual premium payments unless the captive has an unexpected payout period or takes on additional risks. Like ordinary insurers, captive insurers must convince regulators that their business is sound from an actuarial and financial perspective. Typically, captive insurance companies hire outside specialists to assist with this. They retain the underwriting profit and investment income, preserve control over how the company pays losses and settles claims, can develop their own forms and rates based on group experience, and, where necessary, may seek reinsurance to protect against remote risks. Captive insurers can tailor their products to the exact risks and strengths of your organization, whereas commercial insurers lump your risks into the risk profiles of other organizations that may prove quite different. By retaining control over settling claims, captives wrest control from third parties over these claims and are able to benefit directly from enhanced loss prevention programs. Not all types of insurance can be insured through captives, not all states authorize captives for every type of organization and not all risk profiles or organization sizes make sense for captives. Smaller organizations may want to join together in associations to benefit from them. Captives also require experienced and sophisticated management from at least outside vendors. But when the elements for captive insurance are satisfied, it is an excellent way to benefit from good risk-compliance programs and to steward resources. Holland & Knight is glad to assist if you would like more information about captive insurance companies.

Department of Justice May Not Enjoin School Voucher Program Based on Federal Desegregation Order

In Brumfield v. La. State Bd. of Educ., No. 14-31010, 2015 WL 6989319 (5th Cir. Nov. 10, 2015), the court ruled that the district court was without subject matter jurisdiction to modify a federal desegregation order to gain oversight and some level of control over Louisiana's Student Scholarships for Educational Excellence Act (Act). The federal order, put in place in 1975 because of Louisiana's historical practice of subsidizing racially discriminatory private schools, was converted into a consent decree in 1985, incorporating a process for private schools to be certified as non-discriminatory to be eligible for state assistance. Under the court's continuing jurisdiction over the consent decree, the U.S. Department of Justice (DOJ) sought to compel discovery of information about the voucher program, then to alter the order to enjoin Louisiana from awarding any vouchers to students who currently attend public school districts subject to ongoing desegregation orders. The only evidence in the record showed that the Act has no negative effect on school desegregation. Under the Act, students whose family income is below 250 percent of the federal poverty line and who are entering kindergarten or previously attended a school receiving a grade of "C" or lower, with preference of students in "D" and "F" schools, receive scholarships to attend public and private schools. DOJ convinced the district court to enter an order creating a process for continuing federal oversight of the voucher program. Intervenors who are parents of students who participate in the program moved to vacate the order by arguing, inter alia, that the judgment was void under Rule 60(b)(4) for lack of jurisdiction. They appealed the denial of their motion, as if it were tantamount to a refusal to dissolve an injunction. Describing the DOJ's motion as "disturbing" as a transparent attempt to "regulate the program without any legal judgment against the state," the appellate court reversed the district court on the ground that its order was outside the scope of its continuing jurisdiction for three reasons: (1) the voucher program's potential impact on desegregation orders for public schools in separate federal desegregation cases is distinct from eliminating public funding for discriminatory private schools; (2) the voucher program aid is for students rather than private schools; and (3) even if the voucher program aids private schools, it is not being given to discriminatory private schools. Judge Costa dissented on the grounds that the appeal was improper and "vigilance about retrenchment in the area of school desegregation" is reasonable.

Removing Evangelical Proselytizers for Objectionable Speech Violated Constitution

In Bible Believers v. Wayne Cnty., Mich., No. 13-1635, 2015 WL 6500505 (6th Cir. Oct. 28, 2015), an en banc court ruled that a municipality violated the Free Speech and Free Exercise rights of an evangelical group when the sheriff and deputies required them to leave the Arab International Festival, where they were proselytizing with T-shirts and banners proclaiming, for example, "Islam is a Religion of Blood and Murder." The court ruled that the police effectuated a "heckler's veto" and failed to intervene to control a group of adolescents who were throwing objects at the group. The court ruled, "If there is a bedrock principle underlying the First Amendment, it is that the government may not prohibit the expression of an idea simply because society finds the idea itself offensive or disagreeable." The parties agreed that the festival constituted a traditional public forum. They disagreed over whether the evangelical group was involved in incitement to violence or fighting words. The court rejected both arguments; it found the group's speech did not contain a single word encouraging violence or lawlessness and was not directed at any individual. Rather, the court found that it was the hecklers who posed the threat and ruled that an officer may not "sit idly on the sidelines – watching as the crowd imposes, through violence, a tyrannical majoritarian rule – only later to claim that the speaker's removal was necessary for his or her own protection." Because the defendants cut off the group's protected speech, placed undue burden on their exercise of religion and treated them disparately from other speakers at the festival on the basis of the views that they espoused, the court ruled that the defendants' violated their constitutional rights and are entitled to damages.

New Mexico Supreme Court Strikes Schoolbook Loan Program Benefiting Private Schools

In Moses v. Skandera, No. S-1-SC-34,974, 2015 WL 7074809 (N.M. Nov. 12, 2015), the New Mexico Supreme Court reversed the lower courts' ruling that New Mexico's Instructional Material Law (ILM) satisfies Article XII, Section 3 of the New Mexico Constitution. Pursuant to the ILM, the legislature appropriates funds, and private schools are allocated a percentage based on the number of students enrolled in their schools. The schools select and purchase nonreligious materials, then loan them to the students. The New Mexico Supreme Court found a violation of Article XII, Section 3, which states: "The schools, colleges, universities and other educational institutions provided for by this constitution shall forever remain under the exclusive control of the state, and no part of the proceeds arising from the sale or disposal of any lands granted to the state by congress, or any other funds appropriated, levied or collected for educational purposes, shall be used for the support of any sectarian, denominational or private school, college or university." The court referred to this language as an elaboration on the Blaine amendment required as a condition of admitting New Mexico to the union. The court found that the ILM at least indirectly benefits private schools by freeing them from the obligation of buying instructional materials and, thus, is unconstitutional.

Surveillance Program Singling out Muslims Under Constitutional Scrutiny

In Hassan v. City of N.Y., 804 F. 3d 277 (3d Cir. Oct. 13, 2015), the court found that plaintiffs state a claim for violation of the Equal Protection Clause, Free Exercise Clause and Establishment Clause against the New York City Police Department (NYPD) for implementing a wide-ranging surveillance program targeting Muslim individuals, businesses and institutions in the wake of the September 11, 2001, terrorist attacks. The program allegedly involves camera and video surveillance of mosques and worshippers; informants infiltrating mosques (so-called "mosque crawlers" and "rakers"), colleges and universities, and Muslim student groups; intelligence gathering; and reporting on "locations of concern." The plaintiffs argued that because of the program's stigmatizing and reputational consequences, it has adversely affected their worship and religious activities. The court agreed with the plaintiffs that the program is facially discriminatory because it intentionally singles out Muslims for different treatment, and rejected as an insufficient justification the city's claim that the motive was national security and public safety, not animus. Agreeing with two other courts of appeal, the court decided that classifications based on religious affiliation trigger heightened scrutiny under the Equal Protection Clause, but declined to decide whether this is intermediate or strict scrutiny.

Christian Science Nursing Facilities Denied Medicare Reimbursement

In Hill v. Burwell, No. 14-2135(JEB), 2015 WL 6736779 (D.D.C. Nov. 3, 2015), the court affirmed two decisions by the Administrator of the Centers for Medicare & Medicaid Services (CMS) that concluded four Christian Science nursing facilities were not entitled to reimbursement for the provision of specific types of nonmedical care to religious patients. The Medicare statute allows Medicare-certified religious nonmedical healthcare institutions, all of which during the period under review were Christian Scientist, to receive reimbursement for running "approved educational activities" that "contribute to the quality of patient care" rendered by that provider. 42 C.F.R. §413.85. Critical to the dispute, CMS defines approved educational activities as "formally organized or planned programs of study of the type that: (1) are operated by providers...; (2) enhance the quality of health care at the provider; and (3) meet the requirements of ... licensure or accreditation." The fiscal intermediary for Medicare denied reimbursement to the facilities because it concluded that the Commission for Accreditation of Christian Science Nursing Organizations/Facilities, Inc. was not providing adequate accreditation because it lacked specific standards. The court agreed.

Taxpayers Opposed to Tourism Incentives for Noah Project Not Allowed to Intervene

In Ark Encounter, LLC v. Stewart, No. 15-13-GFVT, 2015 WL 6680837 (E.D. Ky. Oct. 30, 2015), the court ruled four taxpayers lacked a substantial interest in the plaintiffs' lawsuit against the state due to their exclusion from a tourism incentive program created under the Kentucky Tourism Development Act. Plaintiffs seek to participate in the program to develop a multi-acre, paid-admission complex consisting of buildings, exhibits and amenities centered on Noah, the Ark and the Genesis flood account. Plaintiffs opposed the taxpayers' intervention on the grounds that the incentives at issue are entirely funded from sales taxes paid by persons who visit the project. By contrast, the taxpayers argue that the tax rebates would "effectively compel" them to subsidize a religious ministry against their will. The court ruled that their interest in the case is no different from that of Kentucky taxpayers at large and, thus, is inadequate.

Church Not Liable for Battery by Treasurer's Husband on Pedestrian

In Rodriguez v. Judge, 132 A.D.3d 966, 2015 N.Y. Slip Op. 07828 (N.Y. App. Div. - 2d Dep't Oct. 28, 2015), the court ruled that a church was not vicariously liable when the church treasurer's husband, while on the way to services with her, assaulted and battered a pedestrian using a gate pole procured from the church premises allegedly with her assistance. The court found that the treasurer was not acting in furtherance of church business at the time, the church owed no duty to and had no relationship with the pedestrian, and the husband's use of the pole to commit the battery was an unforeseeable, superseding and intervening cause of plaintiff's injuries.

Churches Lack Standing to Challenge Texas Election Code

In Joint Heirs Fellowship Church v. Akin, No. 14-20630, 2015 WL 6535336 (5th Cir. Oct. 29, 2015), the court per curiam affirmed the district court's determination that three churches involved in efforts to recall elected officials in Houston and San Antonio lack standing to challenge provisions of the Election Code governing corporate contributions to political committees, defining "political committee" and defining "contribution" and "expenditure." The court gave as the reason a limiting interpretation by the Texas Ethics Commission indicating that it will not enforce the statutes to prohibit the churches' proposed activities.

Former Parishioners Ruled Trespassers at Deconsecrated Parish

In Roman Catholic Archbishop of Boston v. Rogers, 88 Mass.App. Ct. 519, 39 N.E. 3d 736 (Mass. App. Oct. 14, 2015), the appellate court affirmed the trial court's order declaring former parishioners of a deconsecrated parish trespassers and permanently enjoining them from entering the church property. The parishioners maintained an around-the-clock, seven-days-per-week vigil since the decree of suppression entered in October 2004. In February 2015, the Archbishop notified the defendants that they must end their vigil and leave the church or face legal action. The appellate court agreed that the matter could be decided under "neutral principles of law" and that it was not obligated and could not entertain the defendants' claim that they are equitable owners of the church under canon law.

Religious Institutions in the News

The share of U.S. adults who say they believe in God declined from 92 percent to 89 percent between 2007 and 2015.

The U.S. Supreme Court agreed to review another challenge to the contraceptive mandate contained in the Affordable Care Act (ACA).

Peacemaker arbitration has come under criticism.

Australian Catholic bishops face court action and fines for sending home with parochial school children a booklet advocating traditional views on marriage.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.