South Ridge Baptist Church v. Industrial Com'n of Ohio

• Decision Date: 17 August 1990
• Docket Number: No. 88-3091,88-3091
• Parties: SOUTH RIDGE BAPTIST CHURCH, Plaintiff-Appellant, v. INDUSTRIAL COMMISSION OF OHIO, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 1203

911 F.2d 1203

SOUTH RIDGE BAPTIST CHURCH, Plaintiff-Appellant, v. INDUSTRIAL COMMISSION OF OHIO, et al., Defendants-Appellees.

No. 88-3091.

United States Court of Appeals, Sixth Circuit.

Argued Nov. 9, 1988.

Decided Aug. 17, 1990.

Daniel J. Loomis (argued), Cleveland, Ohio, for plaintiff-appellant.

Merl H. Wayman (argued), Columbus, Ohio, for defendants-appellees.

Before WELLFORD and BOGGS, Circuit Judges, and ENGEL, ^* Senior Circuit Judge.

ENGEL, Senior Circuit Judge.

This case presents the question of whether a state violates the free exercise and establishment clauses of the first amendment, U.S. Const.Amend. I, in compelling a church to pay premiums into a public workers' compensation program on behalf of its employees, where the church believes that such payments are sinful. We ultimately hold that although interesting and delicate, this question has effectively been answered in the negative by the Supreme Court. We accordingly affirm the summary judgment against the church, although on somewhat different reasoning than that below.

Ohio's workers' compensation program, Ohio Rev.Code Secs. 4123.01 et seq., is the ordinary public insurance scheme which replaces common law liability of employers to injured employees by insurance benefits from a state-administered fund. The fund and the state's costs in administering it are financed by premiums, payable twice yearly by each employer and assessed according to the number of its employees and the accident risk of the relevant employment. Secs. 4123.01, 4123.35(A), 4123.54. Participation in the program is mandatory for all employers of at least one person in the state, Secs. 4123.01(B), 4123.35(A), but with two exceptions relevant here. First, "employees" is defined not to include ministers of churches. Sec. 4123.01(A)(2)(a). Second, an employer may elect to self-insure and pay benefits directly to its injured employees, if it can satisfy financial solvency criteria and secure the approval of the Industrial Commission. Sec. 4123.35(B); Ohio Admin.Code Sec. 4121-9-03. The workers' compensation program is administered by appellees Ohio Bureau of Workers' Compensation and the Industrial Commission of Ohio.

Appellant South Ridge Baptist Church is a non-profit religious corporation located in Conneaut, Ohio. In affidavits submitted on its behalf, the Church characterizes itself as "an independent, fundamental, Bible-believing, Bible-teaching and preaching church" which "strive[s] to be absolutely obedient to fundamental doctrines of the Bible and seek[s] to operate and live in accordance with historical Baptist doctrine and marks of the New Testament church.... Foundational to our religious beliefs, we hold as a religious belief that the Bible is the very Word of the living God and is the supreme and final authority in religious faith and practice." Aside from its minister, the Church employs several employees. On the basis of several Biblical verses, the Church believes that to participate in the state's workers' compensation program would be to violate God's command that Jesus is the head of the Church and that its funds are God's, to be spent for Biblical purposes. The Church further believes that it has a Scriptural duty to assist its people who have been injured or fallen ill.

On April 13, 1983, the Bureau notified the Church that it must submit a payroll report and remit premiums to the Bureau. After refusing compliance with the notice and lodging objections with the Bureau, the Church filed a complaint on May 27, 1983 in the United States District Court for the Northern District of Ohio alleging that the Ohio workers' compensation statute violated 42 U.S.C. Sec. 1983 by unconstitutionally infringing the Church's rights under the free exercise and establishment clauses. The Church sought (1) a declaration that the Ohio workers' compensation statute, as applied to the Church and similarly situated churches, ¹ violates the free exercise and establishment clauses and analogous provisions of the Ohio Constitution, thereby mandating the Church's exemption from the program; ² and (2) a corresponding injunction against enforcement of the statute.

Venue was properly transferred to the United States District Court for the Southern District of Ohio on July 1, 1986. On July 31, 1987, defendants filed a motion to dismiss under Fed.R.Civ.P. 12(b)(6). Considering this a motion for summary judgment, the district court granted defendants' motion on December 28, 1987. 676 F.Supp. 799 (S.D.Ohio 1987). The court rejected the Church's claim that the workers' compensation statutes violated the Church's free exercise rights, holding that compulsory participation in the program promoted the compelling state interests of compensating injured workers and protecting the solvency of the state-wide compensation system. Further, the court held that the scheme was the least restrictive means available for achieving those state interests because Ohio Rev.Code Sec. 4123.35 allows a qualified employer to opt for self-insurance. The Church had never pursued that option. The district court also held that the workers' compensation system's recordkeeping and reporting requirements did not violate the establishment clause of the first amendment by excessively entangling church and state. In granting summary judgment, the court likewise denied class certification. The Church has appealed.

I.

Under Fed.R.Civ.P. 56(c), a moving party is entitled to summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."

[T]he plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial. In such a situation, there can be "no genuine issue as to any material fact," since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial. The moving party is "entitled to a judgment as a matter of law" because the nonmoving party has failed to make a sufficient showing on an essential element of her case with respect to which she has the burden of proof. "[T]h[e] standard [for granting summary judgment] mirrors the standard for a directed verdict under Federal Rule of Civil Procedure 50(a)...." Anderson v. Liberty Lobby, Inc. [477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986) ].

Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). The moving party bears the burden of proving absence of a material issue of fact, and evidence produced must be viewed in a light most favorable to the nonmoving party. Adickes v. S.H. Kress Co., 398 U.S. 144, 157, 159, 90 S.Ct. 1598, 1608, 1609, 26 L.Ed.2d 142 (1970); see also Adams v. Union Carbide Corp., 737 F.2d 1453 (6th Cir.1984). There is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party. Anderson v. Liberty Lobby, Inc., 477 U.S. at 249, 106 S.Ct. at 2510. Summary judgment is improper if "there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Id. at 250, 106 S.Ct. at 2511.

II.

When determining whether a governmental regulation impermissibly burdens individual rights under the free exercise clause of the first amendment, three factors must be weighed: the magnitude of the burden on defendant's exercise of religion; the existence of a compelling state interest justifying the burden; and the extent to which accommodation of the defendant would impede the state's objectives. U.S. v. Schmucker, 815 F.2d 413, 417 (6th Cir.1987) (citing United States v. Lee, 455 U.S. 252, 256-60, 102 S.Ct. 1051, 1054-57, 71 L.Ed.2d 127 (1982), and other cases). "The mere fact that the petitioner's religious practice is burdened by a governmental program does not mean that an exemption accommodating his practice must be granted. The state may justify an inroad on religious liberty by showing that it is the least restrictive means of achieving a compelling state interest," Thomas v. Review Board, Indiana Employment Security Division, 450 U.S. 707, 718, 101 S.Ct. 1425, 1432, 67 L.Ed.2d 624 (1981), that is to say, "that it is essential to accomplish an overriding governmental interest." Lee, 455 U.S. at 257-58, 102 S.Ct. at 1055-56 (citing Thomas and other cases); see also Hobbie v. Unemployment Appeals Commission of Florida, 480 U.S. 136, 107 S.Ct. 1046, 94 L.Ed.2d 190 (1987); Wisconsin v. Yoder, 406 U.S. 205, 92 S.Ct. 1526, 32 L.Ed.2d 15 (1972); Sherbert v. Verner, 374 U.S. 398, 83 S.Ct. 1790, 10 L.Ed.2d 965 (1963). Whether the state has made this showing depends on a comparison of "the cost to the government of altering its activity to allow the religious practice to continue unimpeded versus the cost to the religious interest imposed by the government activity." Schmucker, 815 F.2d at 417.

In the present case, the Bureau does not contest the sincerity of religious grounding of the Church's belief that its funds are God's alone and should be used according to God's wishes; that God commands them to use the funds to further the Church's various ministries; and that to use some of the funds to pay mandatory premiums into the state workers' compensation fund instead would be sinful. The Bureau likewise does not contest on appeal the district court's sound conclusion that the mandatory participation burdens the Church's free exercise of religion. For its part, the Church concedes that the workers' compensation program...