Klein v. Or. Bureau of Labor & Indus.

• Decision Date: 28 December 2017
• Docket Number: A159899
• Parties: Melissa Elaine KLEIN, dba Sweetcakes by Melissa; and Aaron Wayne Klein, dba Sweetcakes by Melissa, and, in the alternative, individually as an aider and abettor under ORS 659A.406, Petitioners, v. OREGON BUREAU OF LABOR AND INDUSTRIES, Respondent.
• Court: Oregon Court of Appeals

289 Or.App. 507

410 P.3d 1051

Melissa Elaine KLEIN, dba Sweetcakes by Melissa; and Aaron Wayne Klein, dba Sweetcakes by Melissa, and, in the alternative, individually as an aider and abettor under ORS 659A.406, Petitioners,

v.OREGON BUREAU OF LABOR AND INDUSTRIES, Respondent.

A159899

Court of Appeals of Oregon.

Argued and submitted March 2, 2017.

December 28, 2017

Adam R.F. Gustafson, Washington, D.C., argued the cause for petitioners. With him on the briefs were Tyler Smith, Anna Harmon, and Tyler Smith & Associates; Herbert G. Grey ; C. Boyden Gray, Derek S. Lyons, and Boyden Gray & Associates, Washington DC; and Matthew J. Kacsmaryk, Kenneth A. Klukowski, Cleve W. Doty, and First Liberty Institute, Texas.

Carson Whitehead, Assistant Attorney General, argued the cause for respondent. With him on the brief were Ellen F. Rosenblum, Attorney General, Benjamin Gutman, Solicitor General, and Leigh A. Salmon, Assistant Attorney General.

Stefan C. Johnson and Lambda Legal Defense and Education Fund, Inc., California, filed the brief amicus curiae for Rachel Bowman-Cryer, Laurel Bowman-Cryer, and Lambda Legal Defense and Education Fund, Inc.

Peter Meza and Hogan Lovells U.S. LLP, Colorado; Jessica L. Ellsworth, Laura A. Szarmach, and Hogan Lovells U.S. LLP, Washington, DC; Nicole E. Schiavo and Hogan Lovells U.S. LLP, New York; and Seth M. Marnin, Michelle N. Deutchman, David L. Barkley, Anti-Defamation League, New York, filed the brief amicus curiae for Anti-Defamation League, Bend the Arc: A Jewish Partnership for Justice, Hindu American Foundation, Interfaith Alliance Foundation, Hadassah: The Women's Zionist Organization of America, Inc., Keshet, Metropolitan Community Churches, Global Justice Institute, More Light Presbyterians, People for the American Way Foundation, African American Ministers Leadership Council, The National Council of Jewish Women, T'ruah: The Rabbinic Call for Human Rights, Union for Reform Judaism, Religious Action Center, Women of Reform Judaism, Central Conference of American Rabbis, and Women's League for Conservative Judaism.

P. K. Runkles-Pearson, Alexander M. Naito, and Miller Nash Graham & Dunn LLP; Mathew W. dos Santos, Kelly K. Simon, and ACLU of Oregon, Inc.; Jennifer J. Middleton and Johnson Johnson & Schaller PC, filed the brief amicus curiae for ACLU Foundation of Oregon, Inc.

Julia E. Markley, Courtney R. Peck, and Perkins Coie LLP; Richard B. Katskee, Carmen Green, and Americans United for Separation of Church and State, filed the brief amicus curiae for Americans United for Separation of Church and State.

Before DeVore, Presiding Judge, and Garrett, Judge, and James, Judge.^*

GARRETT, J.

Melissa and Aaron Klein, the owners of a bakery doing business as Sweetcakes by Melissa (Sweetcakes), seek judicial review of a final order of the Bureau of Labor and Industries (BOLI) finding that the Kleins' refusal to provide a wedding cake to the complainants, a same-sex couple, violated ORS 659A.403, which prohibits a place of public accommodation from denying "full and equal" service to a person "on account of * * * sexual orientation." The order further concluded that the Kleins violated another of Oregon's public accommodations laws, ORS 659A.409, by communicating an intention to unlawfully discriminate in the future. BOLI's order awarded damages to the complainants for their emotional and mental suffering from the denial of service and enjoined the Kleins from further violating ORS 659A.403 and ORS 659A.409.

In their petition for judicial review, the Kleins argue that BOLI erroneously concluded that their refusal to supply a cake for a same-sex wedding was a denial of service "on account of" sexual orientation within the meaning of ORS 659A.403 ; alternatively, they argue that the application of that statute in this circumstance violates their constitutional rights to free expression and to the free exercise of their religious beliefs. The Kleins also argue that they were denied due process of law because BOLI's commissioner did not recuse himself in this case after making public comments about it, that the damages award is not supported by substantial evidence or substantial reason, and that BOLI erroneously treated the Kleins' public statements about this litigation as conveying an intention to violate public accommodation laws in the future.

As explained below, we reject the Kleins' construction of ORS 659A.403 and conclude that their denial of service was "on account of" the complainants' sexual orientation for purposes of that statute. As for their constitutional arguments, we conclude that the final order does not impermissibly burden the Kleins' right to free expression under the First Amendment to the United States Constitution. We conclude that, under Employment Division, Oregon Department of Human Resources v. Smith , 494 U.S. 872, 110 S.Ct. 1595, 108 L. Ed. 2d 876 (1990), the final order does not impermissibly burden the Kleins' right to the free exercise of their religion because it simply requires their compliance with a neutral law of general applicability, and the Kleins have made no showing that the state targeted them for enforcement because of their religious beliefs. For substantially the same reasons for which we reject their federal constitutional arguments, we reject the Kleins' arguments under the Oregon Constitution. We also reject the Kleins' arguments regarding the alleged bias of BOLI's commissioner and their challenge to BOLI's damages award. We agree with the Kleins, however, that the evidence does not support BOLI's conclusion that they violated ORS 659A.409. Accordingly, we reverse the order as to that determination and the related grant of injunctive relief. BOLI's order is otherwise affirmed.

I. BACKGROUND

We will discuss the relevant evidence and factual findings in greater detail within our discussion of particular assignments of error, but the following overview provides context for that later discussion.¹ The complainants, Rachel Bowman-Cryer and Laurel Bowman-Cryer, met in 2004 and had long considered themselves a couple. In 2012, they decided to marry.

As part of the wedding planning, Rachel and her mother, Cheryl, attended a Portland bridal show.² Melissa Klein had a booth at that bridal show, and she advertised wedding cakes made by her bakery business, Sweetcakes. Rachel and Cheryl visited the booth and told Melissa that they would like to order a cake from her. Rachel and Cheryl were already familiar with Sweetcakes; two years earlier, Sweetcakes had designed, created, and decorated a wedding cake for Cheryl's wedding, paid for by Rachel.

After the bridal show, on January 17, 2013, Rachel and Cheryl visited the Sweetcakes bakery shop in Gresham for a cake-tasting appointment, intending to order a wedding cake. At the time of the appointment, Melissa was at home providing childcare, so her husband, Aaron, conducted the tasting.

During that tasting, Aaron asked for the names of the bride and groom. Rachel told him that there were two brides and that their names were Rachel and Laurel. At that point, Aaron stated that he was sorry, but that Sweetcakes did not make wedding cakes for same-sex ceremonies because of his and Melissa's religious convictions. Rachel began crying, and Cheryl took her by the arm and walked her out of the shop. On the way to their car, Rachel became "hysterical" and kept apologizing to her mother, feeling that she had humiliated her.

Cheryl consoled Rachel once they were in their car, and she assured her that they would find someone to make the wedding cake. Cheryl drove a short distance away, but then turned around and returned to Sweetcakes. This time, Cheryl reentered the shop by herself to talk with Aaron. During their conversation, Cheryl told Aaron that she had previously shared his thinking about homosexuality, but that her "truth had changed" as a result of having "two gay children." In response, Aaron quoted a Bible passage from the Book of Leviticus, stating, "You shall not lie with a male as one lies with a female; it is an abomination." Cheryl left and returned to the car, where Rachel had remained, "holding [her] head in her hands, just bawling."

When Cheryl returned to the car, she told Rachel that Aaron had called her "an abomination," which further upset Rachel. Rachel later said that "[i]t made me feel like they were saying God made a mistake when he made me, that I wasn't supposed to be, that I wasn't supposed to love or be loved or have a family or live a good life and one day go to heaven."

When Rachel and Cheryl arrived home, Cheryl told Laurel what had happened. Laurel, who had been raised Catholic, recognized the "abomination" reference from Leviticus and felt shame and anger. Rachel was inconsolable, which made Laurel even angrier. Later that same night, Laurel filled out an online complaint form with the Oregon Department of Justice (DOJ), describing the denial of service at Sweetcakes.

In addition to the DOJ complaint, Laurel eventually filed a complaint with BOLI, as did Rachel, alleging that the Kleins had refused to make them a wedding cake because of their sexual orientation. BOLI initiated an investigation.

Meanwhile, the controversy had become the subject of significant media attention. The Kleins were interviewed by, among others, the Christian Broadcast Network (CBN) and later by a radio talk show host, Tony Perkins. In the CBN interview, which was broadcast in September 2013, the Kleins explained that they did not want to participate in celebrating a same-sex marriage, wanted to live their lives in the service of God, and that, although they did not want to see their bakery business go "belly up," they had "faith in the Lord and he's taken care of us up to this point and I'm sure he will in the future." The CBN broadcast also showed a handwritten sign, taped to the inside of the bakery's front window, which stated:

"Closed but still in business. You can reach me by email or facebook. www.sweetcakesweb.co

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