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Supreme Court Has Narrowly Limited The Power Of Labor Unions To Collect Dues; Supreme Court Rules In Favor Of Hobby Lobby

Aired June 30, 2014 - 10:00   ET


ALISON KOSIK, CNN BUSINESS CORRESPONDENT: So it sounds like maybe they are thinking maybe, it wasn't such a good idea.

CAROL COSTELLO, CNN ANCHOR: Yes, maybe they should ask first, right, the next time. There will be a next time. We all know that, right? Alison Kosik, thanks so much. The next hour of CNN NEWSROOM starts now.

We are following two big stories this hour in the NEWSROOM. First up, a key decision about birth control, Obamacare and religious freedom. Can Hobby Lobby refuse to pay for emergency contraception because it's a Christian owned company? The Supreme Court expected to decide at any minute now.

Plus, how much will General Motors pay the victims of crashes caused by faulty ignition switches? We'll find out in moments. Should there be criminal charges as well?

Good morning to you. I'm Carol Costello. Thank you so much for joining me. We are watching the U.S. Supreme Court at this hour and a block buster ruling that can be handed down at any moment with the current term about to end, justices have only today to release their decision.

The most highly watch involves Obamacare and Hobby Lobby, specifically whether the new mandate Obamacare could force the retailer to provide emergency contraception as part of its health coverage. The company says that would compromise its religious beliefs.

CNN justice correspondent, Pamela Brown is inside the courtroom awaiting that decision. With me now though are senior White House correspondent, Jim Acosta and also here are CNN senior legal analyst, Jeffrey Toobin. Here too, George Washington University constitutional law professor, Jonathan Turley and CNN chief political analyst, Gloria Borger. Good morning to all of you.

Good morning. Jim, I want to start with you, is the White House worried about this case?

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, I think judging by the way Donald Verrilli, the U.S. solicitor general was sort of batted around during the arguments in this case back in March, I think they have an indication that this may not go their way. You know, look, the Obama administration's argument here is sort of the reverse of Mitt Romney's corporations are people too line. They are sort of arguing that corporations are not people. That they don't have the same religious freedoms, and so Hobby Lobby and other for-profit companies would have to be required to provide contraception coverage under that mandate in Obamacare. It's interesting that we should also point out that Hobby Lobby is not objecting to all forms of contraception, just certain types like the morning after pill.

But Carol, I had a chance to ask the president about this contraception mandate back in March after he met with the pope in Rome and he said, you know, the pope did not raise this issue in their meeting, but Vatican officials did and the president at that time said he told Vatican officials that basically non-profit organizations here in the United States would have that freedom of religion to deny that type of coverage to their employees, if they are affiliated with a hospital or that sort of thing.

But he didn't talk about Hobby Lobby. He didn't talk about for-profit corporations. So it is an issue for the Supreme Court to decide here. It's going to be interesting to see how it comes down. Important to note though, Carol, is that a decision against the contraception mandate in Obamacare would not drag down all of Obamacare, but it would offer opponents of the law an important moral victory. Something they've been looking for a long time -- Carol.

COSTELLO: All right, Jonathan to you because Jeffrey Toobin is not joining us. He must be inside the Supreme Court as well along with Pamela Brown. But Jonathan, the Supreme Court already ruled that corporations are people with political rights so why wouldn't the court rule that corporations have religious liberties.

JONATHAN TURLEY, CONSTITUTIONAL LAW PROFESSOR, GEORGIA WASHINGON UNIVERSITY: Well, that's exactly the question that's going to perplex these justices. This is the flipside of Citizens United. In some ways, the administration was at a disadvantage because they were fighting the premise of Citizens United that corporations don't have all of these aspects of personhood.

The accordance Citizens United say that corporations have free speech rights as persons and so this is the other side of that coin. If they have those free speech rights as persons, how about the religious rights of persons? But the implications of this goes beyond the ACA.

There's a host of challenges from business against discrimination laws and other types of laws where they say you are forcing me to do something that's against my religious beliefs. So the ripple effect of a decision against the Obama administration in this case would actually be quite far reaching.

COSTELLO: Explain what you mean by far reaching. Would it mean for example if I get pregnant and I'm single that someone with religious beliefs would say we don't want you to work for us because you are violating what we feel that's in the bible? Could they do something like that?

TURLEY: Well, I think that would be a bridge too far for most of the justices of the court, certainly for a regular corporation and not a non-for-profit corporation. But where I think you would see that impact is we've had challenges, for example, from bakeries that have said that they don't want to make cakes for same-sex weddings in a challenge to discrimination laws.

The question is if these companies now are like persons, does the outcome of those cases change? So far they have been going heavily against people who are raising those objections. So a lot is going to depend on how the court does this. They could find that corporations have religious rights, but they could also say this isn't a substantial burden on those rights or that the government has a compelling interest. So there's a lot of side roads that the court could take here.

COSTELLO: Gloria, the Kaiser Family Foundation's latest poll shows the majority of Americans feel for-profit companies should be required to provide contraception even if it violates owner's religious beliefs? So will this ruling have an impact on let's say voters in 2016?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Yes, you know, I think it could. I mean, obviously the issue of contraception came up during the last presidential campaign. I think the issue of the Supreme Court is always an issue during presidential campaigns and if Democrats were to lose a case like this, they could try and appeal to women using this case.

And by the way there are lots of other challenges to the Affordable Care Act that are pending on tax issues, for example, that could also be used in a presidential campaign. Let's face it, Carol, everything the court does is political. These days, every decision can be viewed through a political lens.

And this one in particular, but I just want to add one thing to something Jonathan said because there may be a way for the court here to kind of come out with a more Talmudic decision, if you will, that would sort of say, OK, Hobby Lobby you have your rights but maybe there would be a way for these employees to get their birth control through federal subsidies, not through your company.

Maybe your company doesn't have to pay for it, but maybe the government would. So there is -- there is another way they could approach this that would in fact be less politically explosive.

COSTELLO: Well, the other part, Jonathan that's interesting. Hobby Lobby doesn't object to all contraception, right, just emergency contraception for specific kinds that Hobby Lobby says can cause abortion, in essence, right? But science doesn't support that. So if the court rules in Hobby Lobby's favor, isn't it say that religion can make those decisions over science?

TURLEY: That's a very interesting element to the case. Although we also have to remember that this case has been consolidated with another case and that case involves a Mennonite family that runs a business and that family is against contraception generally, and so because they are consolidated, you really have the full range of options for the court.

And so you are absolutely right that that would -- that raises a question that works to the benefit of the government, but the consolidation with those other cases is probably going to make it a wash.

COSTELLO: Jim, just a last question for you. So if Hobby Lobby is only objecting to these four drugs or four methods of emergency contraception because two of them involved IUDs, why not exempt companies with strong religious ownership and be done with it?

ACOSTA: Well, the Obama administration has offered that as a possibility to non-profit organizations. That is part of the case involving the sisters out in Denver who have a separate case against the contraception mandate. They don't like being told to submit a piece of paper to the federal government asking to be exempted from that part of the law.

But one other thing we should touch on, Carol, there's another political component to this. If the Supreme Court rules against the Obama administration, it will be once again the Supreme Court saying that the administration has sort of put an unconstitutional burden on the American people.

That it's been operating or doing things outside the constitution. Remember, just last week, the Supreme Court said the president could not make some recess appointments. Those pro-forma appointments, it feeds into the Republican narrative. Republicans make this case in the fall. The president isn't always winning these constitutional battles up at the Supreme Court.

It could add some political ammunition for the Republican side of things heading into the midterms this fall if they want to make the case that this president, his entire administration is not following the constitution, and this Hobby Lobby case could fall into their court and be used as sort of a political tool heading into the fall. It is a possibility that could shape the fall campaign and fire up the Republican base -- Carol.

COSTELLO: Absolutely. And I'm just hearing that the Supreme Court has handed down a decision on union fees. This is another very important case that some say could destroy unions in this country. Jonathan, explain please.

TURLEY: I've been asking for people to pay attention to Harris V. Quinn for weeks because Hobby Lobby sucks the oxygen out of the room. But this is a very important case. What is involved is a group of home care workers who essentially been charged union dues, they have been effectively forced to pay the union for representation even though they are not union members.

And the union's argument is that under the law in Illinois, they had to negotiate for these people even though they weren't in a union and got them a very good deal, but these people say, yes, but you are still forcing us to associate with unions, you are forcing to speak through unions without our consent. Now the worrisome thing for the unions is that Justice Samuel Alito does not have a lead opinion from the January arguments and usually each of the justices get those opportunities. Alito is the last person the union wants to write this opinion. A couple of years ago, he wrote an opinion that was a serious blow at least symbolically to unions and they fear he could be writer here. If it's Sam Alito, it is a bad day for unions.

COSTELLO: OK, we are reading through that decision. So I'm not going to say what it is until we cross our Ts and dot all our Is. So we're going to do it over the break. All of you stick around. We'll be right back.


COSTELLO: All right, we have a ruling in the union fee case that we were talking about. The U.S. Supreme Court has handed a blow to unions across the country. Jeffrey Toobin, you've read through the ruling. What does it say?

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, it's a little tricky and it's a blow to labor unions, but it's not as big a blow as some people thought. Let me explain the context if I could. Labor unions, often, they have a contract that covers all the workers, all the workers in a given area, and not all those workers sometimes choose to join the union.

The question in this case was in the workers who are home health care workers in Illinois, the ones who don't want to be a part of the union can they be forced to pay some of union dues. Even though they are beneficiaries of the contract, but they don't want to be in the union.

And the court said these workers in particular cannot be forced to pay their union dues. What's significant about the case is that the Supreme Court did not view these workers as public employees. They are home health care workers. They are sort of independent contractors, sort of government employees, so the decision is really just limited to these home health care workers.

It's not about all public employees and labor unions were particularly worried about a decision that would apply to all government workers, so it's a narrow decision, a loss for the unions, but it's not as catastrophic as many labor union people feared.

COSTELLO: OK, let's bring in Rana Foroohar, CNN's global economic analyst and assistant managing editor for "Time" magazine. Welcome. So is Jeffrey right from the union perspective, it's not as good as it -- not as bad as it could have been but we'll take it.

RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: It's yet another blow to unions which frankly have suffered many blows in the last 30 years. It's interesting. Union membership is way down from its peak. This will be another hit to that. It's also interesting, the areas for growth were actually in service areas like this, in health care, in retail. So it's a blow to the areas that were really growth areas for unions as the traditional areas of membership like manufacturing have gone by the wayside in the last 30 years.

COSTELLO: I want to bring in constitutional scholar, Jonathan Turley once again. What stands out to you?

TURLEY: I think it is a fairly significant blow. I think Jeff is right that it could have gone further, but I think that the last observation is really the key one, the nature of the labor force is changing and these workers are really the future worker that we're seeing in the emerging markets. These homeworkers are -- share a lot of attributes of the new emerging workforce.

And for unions it's a big blow because that was their growth area, and it's going to be very difficult now to extend these contracts to get these type of dues. It's a blow in the sense that they lose those dues, but it's also a potential blow in terms of the new market and the new employee and how they will fit into this arrangement.

There's also a concern this is now the second blow to the unions in the last few years, and I think the unions feel that they are getting hit on all sides, not just by the economy but also legally in these opinions.

COSTELLO: We understand, Jonathan, just so you know, there has been a ruling issued -- a decision it will be handed down in the Hobby Lobby case as well. I guess it's no surprise the Supreme Court held this decision to release last, right?

TURLEY: Well, you know, that's the funny thing about the Supreme Court is they have a real sense of theater and they do hold the matinee item for last. Hobby Lobby is a fascinating case and it is really one of those threshold cases that defines so many others. It's something that everyone has been waiting for. So it sort of like a "Rolling Stones" concert, people just camp out and wait and the justices know that.

COSTELLO: Well, they certainly attracted a crowd today. Again, the Hobby Lobby decision has been handed down. Pamela Brown is inside the courtroom. Jeffrey Toobin is reading for the decision. We are going to take a break. We'll be back with much more and hopefully we'll find out what that Hobby Lobby decision is when we come back.


COSTELLO: We're hearing there has been a decision about Hobby Lobby and contraceptive care under Obamacare. We're reading through that decision right now. With me now are senior White House correspondent, Jim Acosta, George Washington University constitutional law professor, Jonathan Turley, chief political correspondent with the Christian Broadcasting Network, David Brody, and Rana Foroohar, our global economic analyst, and CNN chief political analyst, Gloria Borger.

Good morning to all of you. I want to start with you, Jonathan Turley, so a decision has been made. Everybody is talking about some sort of compromise or narrow ruling. Will it come down to what the Chief Justice John Roberts kind of decided? TURLEY: Well, of course, Chief Justice Roberts is the one that snatched defeat away from the act last time. He was the deciding vote that decided the question for the individual mandate, something that he remains very controversial about with conservatives. The question is whether he's going to do that again here.

The difference is that this really isn't a lethal threat to the ACA, but it would cause great complications in the management of that act. The other one to watch is Justice Kennedy who remains the ultimate swing voter.

COSTELLO: Let's see if that is the case. Jeffrey Toobin has read through this decision. What is it, Jeffrey?

TOOBIN: Well, let me be honest. I have not read through the decision yet. I'm getting the gist of it so far. It is a 5-4 decision in favor of Hobby Lobby. Hobby Lobby does not have to pay for the disputed birth control techniques. However, as far as we can tell and we're going to be sorting this out through the course of the morning.

Justice Alito's opinion says this only applies to what he calls closely held companies. Remember, Hobby Lobby is a privately held company where the religious beliefs of the founders inform the whole operations of the company. One of the big issues here is a lot of big businesses in America are privately held, so the question was would this decision apply to them?

What Justice Alito holds in his opinion is that Hobby Lobby as a closely held company does not have to pay for these disputed birth control techniques, but it does not appear to be a blanket ruling that says any privately held company can suddenly decide it has religious beliefs and decide what kinds of health care to pay for and not to pay for. So that's --

COSTELLO: So when you say closely held company, that means all of these family members, involve the green family, that owns Hobby Lobby, they are all religious. They run their business that way. They close their business on Sundays. They play religious music in their stores. We are religious and we want to practice our business that way.

TOOBIN: Right. There are many privately held companies that are not controlled by a similar family or a single small group of people. They have more widely spread out ownership and they also don't have any collective religious beliefs. So those companies would not be covered by the Hobby Lobby decision.

So there appears to be an effort by Justice Alito and the court to say we are only allowing companies that are closely held by a small group of people, usually presumably a family, that they have actual religious beliefs. A large company with diverse owners could not claim exclusion from the contraceptive mandate under this decision.

COSTELLO: Let's head out to the U.S. Supreme Court. A lot of demonstrators there this morning. Pamela Brown, what's the reaction?

PAMELA BROWN, CNN JUSTICE CORRESPONDENT: There's been a huge reaction out here, Carol. At the Supreme Court, you can see behind me, demonstrators and these were demonstrators behind me who were in favor of religious freedom rights, in favor of Hobby Lobby and as soon as that decision came down, when the justices, the majority of the conservative justices ruled in favor of Hobby Lobby, they started cheering claiming victory.

I can tell you we've been out here all morning, Carol, and this is bringing heated rhetoric from all sorts of contentious issues. We're talking Obamacare. We're hearing from demonstrators on both side of that issue. Abortion, religious liberty rights. There's a huge crowd out here today making their voices heard. This is a big win for Hobby Lobby.

The justices essentially saying that this company cannot be required to cover certain types of contraception. Hobby Lobby objected to four types of contraception that the owners equated to abortion and they said it would be a violation of their religious freedom rights to provide coverage of these certain types of contraception to its employees.

And today the justices is saying under this 20-year-old federal law called RIFRA that Hobby Lobby does not have to be required by the government to cover certain types of contraception to its employees. I want to emphasize that this is specific to closely held companies. So as it appears, as we continue to read through this large ruling right here, it appears that only closely held companies can be exempt from this.

Similar to religious nonprofits and then churches, but it doesn't necessarily apply to publicly traded companies, big companies. Hobby Lobby was a family-owned company. It started back in the 70s. The owners are Evangelical Christians. So it's important to take this ruling in that context. This is the first big test of Obamacare since it was found constitutional here two years ago.

So, of course, this could open the flood gates to more lawsuits, challenging other provisions in the Affordable Care Act and it will be interesting to see how the Obama administration reacts to this because the contraceptive mandate was a key provision. This was a big blow to the Obama administration. A big win for Hobby Lobby.

During the oral arguments, the Obama administration argued that if companies like Hobby Lobby are allowed to be exempt from offering certain types of contraception coverage to its employees and perhaps that could open the gate for other companies who wanted to cover things like medical marijuana. They are not according to this ruling not be required to provide four types of contraception to their employees -- Carol.

COSTELLO: I want to go to Russell Moore. He is the president of the Ethics and Religious Liberty Commission of the Southern Baptist Convention. Russell, are you pleased with the ruling?

RUSSELL MOORE, PRESIDENT OF THE ETHICS AND RELIGIOUS LIBERTY COMMISSION: I am elated, and I am watching people who are erupting in applause and literally dancing on the steps of Supreme Court and I'm doing so myself with them in spirit because this is a great victory for religious liberty in this country, not only for Hobby Lobby, but for everyone, regardless of religious conviction. It is the court saying that the government cannot pave over people's consciences. I think it's a tremendously good win and a good day for all Americans.

COSTELLO: Jonathan Merritt, he is a senior columnist for "Religious News Service" that the Supreme Court ruled that this only applies to narrowly held companies. Does that make you feel better about the ruling overall?

JONATHAN MERRITT, SENIOR COLUMNIST, "RELIGIOUS NEWS SERVICE": I wasn't against Hobby Lobby in this case. I was torn on it. There were some particularly liberals who were arguing that if the ruling was broad that it would open Pandora's box, that you would have sort of a domino effect that companies from Walmart, FedEx, whoever wanted to could just say we have religious convictions and can save money on covering contraceptives.

I do think that we're going to see this adjudicated in various ways in upcoming days. Our CNN correspondent just mentioned will there be cases seeking to exempt blood transfusions, vaccinations, those sorts of things, I think it will be interesting going forward to see what kind of cases come forward based on this ruling.

COSTELLO: Yes, we are going to be talking a lot more about this. I want to go back out to the scene because it looks like a pretty raucous scene, Pamela Brown. Just give us a flavor of what's happening there in Washington.

BROWN: Yes, Carol, the energy is palpable out here. I've never seen a crowd like this before in front of the Supreme Court. You have to put this in perspective too. This was the biggest case of the term for the Supreme Court and this is the final day of the public session and here we are with this ruling that the justices ruling in favor of Hobby Lobby. We have three contentious issues converging with this decision: abortion, Obamacare, religious freedom.