Do Corporations Have Protected Rights Regarding Religious Expression?

Reply Tue 25 Mar, 2014 04:30 pm
A divided Supreme Court seemed inclined to agree Tuesday that the religious beliefs of business owners may trump a requirement in President Obama’s Affordable Care Act that they provide their employees with insurance coverage for all types of contraceptives.

With both snow and demonstrators gathering on the sidewalk outside, it was difficult to predict a precise outcome from the spirited 90-minute argument.

But a majority of the justices seemed to agree that the family-owned businesses that objected to the requirement were covered by a federal statute that gives great protection to the exercise of religion. That would mean the government must show the requirement is not a substantial burden on their religious expression, and that there was no less intrusive way to provide contraceptive coverage to female workers.

Reply Tue 25 Mar, 2014 05:16 pm
From this AMs Lancaster News. A summary of the Conestoga Wood Specialties case also before the USSC

Conestoga Wood vs. Obamacare: Questions and answers

By JEFF HAWKES | Staff Writer
Only 108 men and four women have had the privilege of serving as a Supreme Court justice.
They're an elite few, yes. But the big ideas they tackle shouldn't intimidate the rest of us. And that goes for the facts and law involved in Conestoga Wood Specialties Corp. v. Kathleen Sebelius.

The challenge for the justices will be weighing the conflicting values of religious liberty and public health.

For a glimpse into how they might achieve a balance, we should pay attention to questions asked at today's oral arguments.

To get ready, here's a look at the background and issues the court is likely to consider.

Sure, you can't don the robe. But with a little help you can begin to think like a Supreme Court justice.

Why did Conestoga Wood sue the federal government?

For-profit Conestoga Wood, based in East Earl, is entirely owned by Norman Hahn and his family. They are conservative Mennonites who believe life begins at conception.

Their convictions clash with the Obama administration's requirement that large employers provide their workers with health plans that cover the 20 contraceptive methods approved by the Food and Drug Administration. Four of the methods are emergency contraceptives that some say may destroy a fertilized egg.

The Hahns filed suit because they object to the government forcing them to pay for coverage that violates their religious belief.

What will happen to Conestoga Wood if it loses?

The Hahn family hasn't said what it will do if the Supreme Court sides with the government.

What is known is, if they offer a health plan but refuse to cover emergency contraceptives, the 1,053-employee company would be subject to a fine of $100 per worker per day. That amounts to $105,300 a day, or more than $38 million a year.

Another option is for Conestoga Wood to drop employee health coverage altogether. In that case the annual fine is $2,000 per employee, or $2.1 million for the entire workforce. Workers would have to buy their own coverage.

What happens if the government loses?

The Hahn family won't have to cover emergency contraceptives, and their workers and the workers' dependents will have to pay out-of-pocket for them.

Meanwhile, other for-profit companies whose owners have religious convictions may seek exemptions from health care or other regulations they believe infringe on their beliefs.

That means more lawsuits with courts having to expand this new area of case law.

Didn't the government anticipate that some employers would object to covering contraception?

Actually, it did.

The Obama administration has, in fact, found ways to exempt pro-life churches and faith-based nonprofits, such as hospitals and schools, from the contraception provision.

But the government did not offer a similar exemption to for-profit companies, even those, like Conestoga Wood, that are entirely owned by members of a pro-life faith.

Is that because a for-profit company might seek an exemption just to avoid the cost of contraceptive coverage?

Actually, money isn't the issue. Experts say an employer would see no savings on a health plan lacking contraception coverage.

The government has never suggested that companies are being disingenuous about their motives for wanting an exemption.

Then why doesn't the government just give for-profits like Conestoga Wood an exemption?

Well, let's count the reasons. First, the government notes that the regulation is on Conestoga Wood Specialties Corp., not on the individual owners.

It points out that a corporation exists to give its owners certain protections under the law. The government says owners can't claim the corporate shield doesn't exist whenever having it is inconvenient.

"Few norms," it says, "are more deeply ingrained into the fabric of American law than the principle that 'a corporation and its stockholders are deemed separate entities.'"

Second, the government sees a distinction between a church or faith-based institution and a for-profit company engaged in secular commerce.

Third, the government points out that workers may not share an employer's religious belief. The government says it's not fair to grant a company a religious exemption when the result is the employees and their dependents will have to shoulder a health care-related financial burden.

"A commercial employers' ability to freely exercise his religion in the workplace reaches its limit," it says, "when it collides with the rights of his employees."

Fourth, the government warns that a win for Conestoga Wood could open the floodgates to other faith-based objections to medical coverage, ranging from immunizations to blood transfusions. It says the result would be "a patchwork of unpredictably incomplete coverage."

Doesn't the government have a point? Corporations, after all, don't have souls.

Of course, the government has a point, but Conestoga Wood's attorneys are quick to fire back.

They note, for example, that while a corporation doesn't pray and can't be baptized, religious people routinely form corporate bodies to promote their faith. Furthermore, federal law, including the key law governing this case, routinely includes corporation in its definition of "person."

They also say that, for purposes of assessing a burden on religious practice, the distinction between for-profit and nonprofit shouldn't apply.

Conestoga Wood, in response to the argument that their workers' rights and needs are being overlooked, says the mere fact that a regulation benefits a third party is not proof of a compelling need for the regulation.

It adds, "If third-party harm were a trump card against exemptions, it would mean that the harm to religious exercise would always be deemed acceptable, no matter how insignificant the government’s interest or how many alternative means of serving it are available."

So if both sides have good points, are the justices just going to flip a coin?

Who knows what goes on in the Supreme Court's chambers. But dithering justices do have a road map to guide them to a decision. It's called the federal Religious Freedom Restoration Act, and it sets out how a judge is to decide whether a law restricts religious freedom.

Under RFRA, the government may, in fact, impose a "substantial burden" on one's religious exercise. But it has to justify the burden.

It tries to do that by first showing that there's a "compelling" need for the law. Then it must show that there's not a less burdensome way on aggrieved believers to achieve the law's ends.

Does the government have a compelling reason for wanting Conestoga Wood to cover emergency contraception?

The government says preventing unintended pregnancies is an important health goal, particularly for women for whom a pregnancy would complicate a health condition.

Conestoga Wood counters that if access to contraception was so important, the government wouldn't have let religious groups and small employers off the hook.

Its brief says the government cannot claim a "paramount" need for the contraception provision when it allows millions of women to go uncovered.

Well, couldn't the government find a way to expand access to contraception provision without burdening religious employers?

Some experts think the court's opinion may hinge on this question.

Attorneys for Conestoga Wood say the government could easily find another way to increase access to contraception. They suggest alternatives such as expanding safety-net programs, offering a tax credit or harnessing the Affordable Care Act's online marketplace.

The government counters that the easiest way to make contraception affordable is to require it as part of an employer's health plan. Other ways, such as those proposed by Conestoga Wood, the government says, will make it harder for women to get contraception.

How strong is Conestoga Wood's case?

Clearly, Conestoga Wood has a reasonable chance of prevailing, or else the Supreme Court would have just let the lower court's ruling against the company stand.

That said, many experts say the case is too close to call. The only consensus seems to be that the court will split.

A decision is expected in June.

0 Replies
Reply Tue 25 Mar, 2014 05:17 pm
A transcript of today's oral arguments is available at supremecourt.gov:
0 Replies
Peter Frouman
Reply Tue 25 Mar, 2014 09:48 pm
I am a bit appalled at the extent to which "religious freedom" is constantly being used to justify, excuse and permit violating the basic human rights of others. Thanks to decades of lobbying by Christian Scientists and other religious organizations, many states now have laws on the books that permit a religious defense or exemption to criminal charges of child abuse, neglect and even manslaughter. Religious freedom should not give anyone the right to kill or seriously injure their child yet, in many U.S. states, that is the law. In Idaho, there is a cemetery filled with the graves of over 100 children who died as a result of child abuse and neglect based on religous beliefs and practices. Those responsible for their deaths could not be prosecuted because Idaho law has a religious exemption for criminal injury to a child. Some of their parents moved to Idaho after Oregon repealed religious exemptions for criminally negligent homicide and other crimes.

This case is not as extreme as these employers merely seek to use their religious beliefs as a basis for controlling how their employees use compensation provided by the employer in exchange for their labor. Health insurance benefits are essentially a form of compensation. Imagine if Muslim and Jewish employers argued that religious freedom gave them the right to prohibit their employees from using their compensation to buy pork meat (the consumption of which is prohibited by religious law) or if Breatharian employers argued that they had the right to forbid their employees from using their compensation to obtain food and water. Surely, no one would take such arguments seriously but in this case, a very similar and just as ridiculous argument is being taken seriously.

There is no medical treatment or healthcare that is not strongly objected to by some religious group. Taken to its logical conclusion, a ruling that employers can provide their employees with health insurance plans that don't cover forms of healthcare (e.g. - birth control pills) to which the employer has a religious objection would also permit Scientology health care plans that don't include any mental health coverage, Jehovah's Witnesses health care plans that exclude blood transfusions and Christian Science plans that don't provide any healthcare at all. In any case, employers who don't want to provide health care insurance plans that cover healthcare they object to on religious grounds (e.g. - contraception, blood transfusions, mental health care or even medical treatment in a hospital that serves pork products in its cafeteria) have a very easy way out: simply do not offer their employees any healthcare coverage. The annual penalty of $2000 per employee is certainly much less than the actual cost of a health care insurance plan.
Reply Wed 26 Mar, 2014 08:52 am
@Peter Frouman,
I see the main problem with the current case in the same way as you. Employers are interfering with the health care decisions of their employees based on religious views that the employees may not share.
Reply Wed 26 Mar, 2014 10:22 am
@Peter Frouman,
Peter Frouman wrote:
I am a bit appalled at the extent to which "religious freedom" is constantly being used to justify, excuse and permit violating the basic human rights of others.

I agree. And I agree with the rest of your argument as well.
Reply Wed 26 Mar, 2014 10:32 am
I fully agree to your well stated opinion.
0 Replies
Reply Wed 26 Mar, 2014 10:44 am
The USSC will have to expand their deliberation from this limited case to the expanded issue that Peter Frouman has presented.

I can see that, should "Hobby Lobby" and "Conestoga Wood" prevail, we can expect the reopening of many issues regarding the " Establishment Clause" of the 1st Amendment.
Free expression of ones religion is not a license for its components, unless the Fed Govt is now going to endorse these practices at the expense of all the population that is NOT Mennonite .
In Wisconsin v Yoder, the Amish hd already established a parochial school system that they pay for and still they pay municipal school taxes, As do Catholics
Reply Wed 26 Mar, 2014 11:13 am

Are corporations separate entities from their owners? Either they are or they are not. You can't have it both ways. When owners become responsible for the religious viewpoint of a corporation why should they not also become responsible for other aspects of the corporation. Can we sue owners for debts of the corporation? Can we sue them for other actions of the corporations?

At what point do we separate the personal actions of the owners from the corporate entity?
0 Replies
Reply Wed 26 Mar, 2014 11:18 am
That's a good question. Corporations are considered to legally be persons for many purposes--notably for making campaign contributions. However, are the companies referred to here corporations, or are they sole proprietorships, or are they S-corporations, a sole proprietorship which is incorporated for the purpose of enjoying the advantages of reduced liability?
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Reply Wed 26 Mar, 2014 05:35 pm
The Washington Post, as quoted by wandeljw, wrote:
A divided Supreme Court seemed inclined to agree Tuesday that the religious beliefs of business owners may trump a requirement in President Obama’s Affordable Care Act that they provide their employees with insurance coverage for all types of contraceptives.

So the press keeps telling me; I think the Supreme Court would be crazy to do that. The core principle of corporate law is the separation of ownership and control: A corporation is created by public law as a legal person in its own right, separate from the natural persons who own it. Granted, there is no doubt that the US constitution gives the owners of a corporation the right to freely exercise their religion, as well as protection against government establishments of religion. But to argue that corporations and limited-liability companies can inhere these protections from their owners seems absurd to me under the first principles of corporate law. I'm well aware that politics can taint a court's opinions. But as a purely legal matter, I fail to see how this is a 5:4 case.
Reply Wed 26 Mar, 2014 05:48 pm
If the corporate veil is pierced for this, why not for other things? Let's see those individuals on the board pay the taxes of the corporation. What the hell.
Reply Fri 4 Apr, 2014 01:10 pm
I see that the "Hobby Lobby's" 401-K investment portfolio is full of pharmas that produce contraceptive formulations and devices, as well as birth control devices.

Never try to sound too pious because some damn cubby reporter will find the chinks in your armor.
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Reply Mon 7 Apr, 2014 08:06 pm
Hobby Lobby verdict may be a surprise

The prognosticators have already declared that, during the Hobby Lobby v. Sebelius oral argument, the Supreme Court justices looked poised to extend religious liberty protections to for-profit corporations. Believe them if you want. But two important wrinkles in the oral argument that haven’t excited comment might tell us a lot about both the court’s potential holding and the tenor of the possible dissent.

The first and most interesting twist came in an aside by Chief Justice John Roberts. Solicitor General Donald Verrilli was arguing that if Hobby Lobby, a for-profit corporation controlled by a trust, could assert religious liberty rights under the Religious Freedom Restoration Act, then all sorts of for-profit corporations might begin claiming religious exemptions. Roberts responded that there was a solution: If the court restricted its Hobby Lobby decision to closely held Chapter S corporations, it would “avoid all the problems” of the parade of horribles advanced by Verrilli.

The suggestion that, at least for the moment, only closely held firms could claim they were exercising religious liberty has all the earmarks of classic Roberts jurisprudence: It would be cautious, restricting the decision to only the case before the court. It would minimize drastic headlines about the court repeating its errors in the Citizens United decision that gave corporations free-speech rights, because this rights extension would be narrower. And it would potentially open the door for significant extension by lower courts. By leaving the question of publicly traded corporations open, the court would not preclude the corporations’ claiming the same rights exercised by closely held ones.

Apart from all these clever, lawyerly advantages, such a restrictive holding might also be legally plausible. My own view is that for-profit corporations should not be considered persons when it comes to fundamental liberties that we enjoy by virtue of our human autonomy. But as some of my religiously inclined students have strongly argued to me, there may be little difference between a sole proprietor acting in the sphere of his profession and an individual exercising his religious liberty in other spheres of life.

Classical Protestantism of the type associated with John Locke, the English father of modern American religious liberty, recognized a difference between actions that are inherently religious and those that are “indifferent” to salvation. I am confident that the founding fathers would have agreed with Locke and therefore with the distinction between doing business and doing religion. But times have changed. Many Catholics and Jews, not to mention some contemporary Protestants, may not recognize this distinction as meaningful, preferring every sphere of life to be treated as pervasively religious.

If my students are right, then the sole owner of a business - or the employee - perhaps ought to have religious liberty rights on the shop floor. But those rights certainly should not be extended to the shareholders of a publicly traded for-profit corporation. It may just have been possible to claim, as Justice Anthony Kennedy did in Citizens United, that people associate with each other in corporations to advance their speech interests. But people don’t buy shares in for-profit firms to exercise their religion - unless that religion is capitalism itself. If the Supreme Court is to create a religious liberty right for corporations, it would be logical to restrict it to closely held ones.

On the other side of the coin, Justice Sonia Sotomayor made a terrific point in oral argument that the parties had not raised — and it deserves to be the centerpiece of a dissent if there is no majority for it. Sotomayor noted that both parties assumed that Hobby Lobby would be burdened by having to pay a penalty or fine if it chose not to extend contraceptive coverage to its employees.

As she observed, however, under the Supreme Court’s holding in the case establishing the constitutionality of the individual mandate of the Affordable Care Act, the court characterized the mandate as a tax, not a penalty. (At this point in the oral argument, Roberts, the author of that controversial holding, drew laughs by interjecting, “She’s right about that.”)

Justice Elena Kagan then chimed in. If the result of noncoverage is a tax, rather than a penalty, she suggested, then Hobby Lobby faces a choice, not a “burden” as required by the religious freedom act. It can either choose to end health-care coverage for all its employees and pay the $2,000 per employee tax, or it can provide contraceptive coverage. This, Kagan said, amounted to the government saying, “You can do this thing or if this thing violates your religion you can do another thing.”

Clement had no good answer to the Sotomayor-Kagan onslaught. Justice Antonin Scalia tried to help him out by saying that Hobby Lobby would have to pay its employees more if it did not offer health-care coverage. But as Kennedy immediately asked, “Why is that a problem?” If the $2,000 penalty approximated the cost of providing health-care coverage, Kennedy proposed, Hobby Lobby would not be substantially burdened. Pressed, Clement claimed that that Hobby Lobby as a matter of faith felt that it must provide health-care coverage to its employees. But this far-fetched argument was legally irrelevant insofar as you have no right to fulfill your religious duties without incurring private costs.

If Kennedy were to go with Sotomayor and Kagan on this point, the case would very likely come out 5-4 for the government. If he backs Roberts, the case is extremely likely to go for Hobby Lobby. Betting on which way Kennedy will turn in close cases is rarely a moneymaking proposition. But either way, the oral argument actually offered more light than heat. It’s nice when the court does its job.
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Reply Fri 11 Apr, 2014 02:35 pm
There is an interesting legal analysis at justia.com:

The Sebelius v. Hobby Lobby Stores case argued before the Supreme Court last week raises the question whether the Hobby Lobby chain of arts and crafts stores is entitled, under the Constitution or the federal Religious Freedom Restoration Act (RFRA) to be exempt from the requirement in Obamacare that employers who provide health insurance to their employees include in the insurance policy certain forms of contraceptives, the use of which for some persons (including the owners of Hobby Lobby) is forbidden by religious principles. Many commentators, ourselves included, predict that Hobby Lobby will win the case, and be found to be exempt from the Obamacare requirements by virtue of RFRA.

Yet at the oral argument, many Justices, especially Justices Ginsburg and Sotomayor but also Chief Justice Roberts, pressed Hobby Lobby’s lawyer, Paul Clement, on just how far his religious-exemption argument might extend. Right out of the gate, Justice Sotomayor asked him about religiously-inspired objections to vaccines and blood transfusions. Moving beyond healthcare mandates to other federal regulations of employers, Justice Kagan asked, a few moments later: “So another employer comes in and that employer says, ‘I have a religious objection to sex discrimination laws’; and then another employer comes in, ‘I have an objection to minimum wage laws;’ and then another, child labor laws. And [under] all of that [the federal government can win only if it satisfies] the exact same test [for RFRA you describe today,] which you say is this unbelievably high test?

If, as we expect, Hobby Lobby prevails, it will be very important for the preservation of other important legal principles and public policies that the Court not rule in Hobby Lobby’s favor on too broad a basis. In the space below, then, we try to identify how an opinion in Hobby Lobby’s favor should—and should not—be crafted.

- See more at: http://verdict.justia.com/2014/04/11/narrow-proper-way-court-rule-hobby-lobbys-favor#sthash.BglITiXt.dpuf
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Reply Fri 2 May, 2014 12:42 pm
Complicity and Contraception: Rethinking Hobby Lobby’s Claim of ‘Substantial Burden on the Exercise of Religion’
Published April 30, 2014 | By Kyle Edwards

Within the next month, the United States Supreme Court will decide whether for-profit corporations shall receive an exemption from providing certain types of contraceptives that are otherwise mandated for healthcare coverage by federal law to employees on the basis of the religious objections of the corporations’ owners. The two cases considered in tandem by the Supreme Court, Sebelius v Hobby Lobby Stores, Inc., and Conestoga Wood Specialties Corporation v Sebelius (Hobby Lobby from here on out), feature a Christian-owned arts and crafts chain and a Mennonite Christian-owned furniture manufacturer, the owners of which object to four specific forms of birth control that they claim cause abortions.

In making their argument for an exemption, the claimants rely mainly on the Religious Freedom Restoration Act (RFRA) passed by Congress in 1993. The RFRA states, “Government shall not substantially burden a person’s exercise of religion…” unless “that application of the burden to the person – 1) is furtherance of a compelling governmental interest; and 2) is the least restrictive means of furthering that compelling governmental interest.” This sets up three tests for judging the permissibility of a government act: the substantial burden test, the compelling interest test, and the least restrictive means test. For the claimants in Hobby Lobby to be successful under the RFRA, the Supreme Court would need to decide first that the government’s ‘contraception mandate’ is indeed a ‘substantial burden’ and second that the provision of contraception is both a compelling government interest and that employer based health insurance is the least restrictive method for securing that interest.

Scholars and journalists have taken various approaches in responding to the range of questions related to these three tests. However, I argue here that Hobby Lobby’s exemption claim can be denied without diving into this spectrum by showing that it fails to meet the first test: the government does not place a substantial burden on the exercise of religion by Hobby Lobby and Conestoga Wood in its ‘contraception mandate.’

The basic belief that Hobby Lobby’s claim for an exemption rests upon is that “offering these [four types of contraceptives] in their health plan makes them complicit in abortion” (pg. 35). The argument I wish to advance is quite straightforward: offering these contraceptives as part of a broad health plan – even granting the scientifically disputed claim that they prevent implantation of the embryo and thus cause abortion – does not make the corporation complicit in the act of abortion. The claimants, I will seek to show, operate on a flawed understanding of decision-making and moral responsibility for action in believing that they are complicit in abortion by offering their employees a healthcare plan that includes access to the contraceptives in question.

To begin, consider that the coverage of contraception is a component of the broader mandate that group health plans cover ‘preventive health services,’ which is in turn a requirement of the general mandate that employers cover health insurance for their employees or pay a ‘shared responsibility payment.’ As the name of the payment suggests, we have decided that large employers have a basic responsibility to provide their employees with broad healthcare coverage, which includes both treatment and prevention, as key partners of the government in the quest to provide universal healthcare coverage in the US. This dedication to universal coverage reflects the importance, if not primacy, of health in pursuing our plans and goals in life, especially our ability to contribute meaningfully to society, our families, and our own welfare as members of the workforce.

This ‘shared responsibility,’ however, is limited to the provision of broad and – importantly – indeterminate healthcare coverage. The specific determination of what that provision of healthcare will entail is properly conceived as a private decision made by a patient in consultation with her doctor. Health decisions, specifically in this case decisions about contraception, are deliberated, decided, and acted upon by two moral agents only within the context of a private consultation: the patient and doctor. Consequently, moral responsibility for these actions – whether the decision is for abstinence, condoms, a hormonal birth control pill, or an IUD – falls squarely and solely on these individuals.

0 Replies
Reply Sun 1 Jun, 2014 09:11 am
interesting post!
0 Replies
Reply Mon 9 Jun, 2014 06:10 pm
The debate over religious tolerance
By Christopher Shea, Chronicle of Higher Education, June 9, 2014

Should religious believers be exempt from laws the rest of Americans must follow, if those laws conflict with the teachings of their faith? The Supreme Court is expected to render a decision soon in Sebelius v. Hobby Lobby Stores, a case in which that question is very much at issue. The owners of the craft-store chain, who are Christian, claim a religious exemption from the Affordable Care Act, arguing that to be forced to pay for insurance that covers certain kinds of birth control, like Plan B, which they believe can cause abortions, would violate their First Amendment right to freely exercise their faith.

Much of the debate surrounding that case has focused on whether a corporation can claim the rights of an individual citizen, and whether a religious exemption should be granted even if other people (female employees of Hobby Lobby) will be harmed.

There has been less attention paid to the justness of such exemptions in general.

Religious freedom is sometimes called the "first freedom," because the imperative that "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof" opens the First Amendment. But a growing number of legal scholars say that granting believers privileges denied to other people with strong ethical views no longer makes sense, if it ever did.
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Reply Tue 10 Jun, 2014 03:38 pm
It might not be in anyone's interest to take Corporation Law advice from one who opines that corporate officers are exempt from personal liability in regards to the corporation. I was at the sheriff sale of a home of a Dot-com corporate officer who found out how liable you can be. Based on the points below, judgments can widely vary as judges have much latitude in interpretation of law. And even winning on appeals can be a questionable victory when the lawyer's bill comes due.

"The courts have not yet provided a bright-line rule governing the personal liability of corporate officers. But there are a number of instances in which officers can be held liable for misconduct [among other things]...How does the oft-mentioned “business judgment rule” fare as a protective weapon? Not very well lately. A recent appellate ruling determined that California’s “business judgment rule” does not insulate corporate officers from liability. "

See more at: http://www.greenbergglusker.com/news/articles/When-Corporate-Officers-Are-Personally-Liable-#sthash.Xm6p6VLs.dpuf

Information on this topic can be found on several thousand web sites, including the A2K tome of all valid knowledge WIKIPEDIA!
0 Replies
bobsal u1553115
Reply Tue 10 Jun, 2014 03:42 pm
In reality or in the opinion of a Scalia Supreme Court? If Democrats can hold onto the White House the court will change.
0 Replies

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