The Spectacle Blog

A Corporate Lawyer Explains Hobby Lobby

By on 7.8.14 | 5:09PM

Let a corporate lawyer offer a simple explanation why Hobby Lobby was correctly decided. I’m an individual, right (even tho’ I’m a corporate lawyer)? So I shouldn’t be forced to pay for my employee’s abortion, right? I don’t know anyone on the Left disputing that.

Take it a step further. I shouldn’t be forced to pay for an abortifacient drug for my employee, right? Comes down to the same thing as an abortion.

Now suppose that I worry about the possibility of my business going bankrupt. If that happens, I don’t want to lose my house. I’m especially worried about my main supplier taking me to court, so in my contracts with him I always insert a clause to the effect that, if he sues me, he can’t go after the house. He agrees, and I like the clause so much I include in all my business contracts.

Problem is, I get really tired explaining that clause to every supplier and business with which I deal. So I incorporate as a limited liability company, where the default is a successful litigant can proceed against my business but not my personal assets. Note that all I’ve done is replicated what I had done with each potential litigant by private contract. So if I could have asserted First Amendment rights as a private person, I should also be able to do so when carrying on business as a corporation.

Two caveats here. First, as the Supreme Court noted, this really only works where the corporation is a legal fiction, i.e., the firm is a wholly owned, closely-held corporation. It doesn’t work for public companies with thousands of shareholders.

Second caveat. The analysis doesn’t work for non-consensual creditors, e.g., tort claimants — think the guy I hit with my car, or the government tax collector. But then from a First Amendment perspective there’s no reason why the tort claimant shouldn’t enjoy a greater right to ignore my religious objections. 

Oh yeah, I forgot. Corporations are intrinsically evil. Not much I can say to idiots who believe that.

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