Case 3:16-cv-00386-PDW-ARS Document 124 Filed 01/19/21 Page 1 of 57
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF NORTH DAKOTA
`EASTERN DIVISION
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`The Religious Sisters of Mercy, et al.,
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`Plaintiffs,
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`vs.
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`Alex M. Azar II, Secretary of the United
`States Department of Health and Human
`Services, et al.,
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`Defendants.
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`MEMORANDUM AND ORDER
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`Case No. 3:16-cv-00386
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`Catholic Benefits Association, et al.,
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`Plaintiffs,
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`vs.
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`Alex M. Azar II, Secretary of the United
`States Department of Health and Human
`Services, et al.,
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`Defendants.
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`Case No. 3:16-cv-00432
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`In these consolidated cases, a coalition of entities affiliated with the Catholic Church and
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`the State of North Dakota challenge the implementation of Section 1557 of the Patient Protection
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`and Affordable Care Act (“ACA”), a statute that prohibits certain forms of discrimination in
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`healthcare. The Plaintiffs contend that the Department of Health and Human Services (“HHS”)
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`and, derivatively, the Equal Employment Opportunity Commission (“EEOC”) interpret Section
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`1557 and related antidiscrimination laws in a way that compels them to perform and provide
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`insurance coverage for gender transitions and abortions.
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`The Catholic Plaintiffs move for summary judgment and injunctive relief under the
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`Religious Freedom Restoration Act of 1993 (“RFRA”). North Dakota joins some of them in an
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`Administrative Procedure Act (“APA”) challenge and separately seeks reprieve under the
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`Spending Clause of the Constitution. For the reasons below, the Court concludes that the RFRA
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`entitles the Catholic Plaintiffs to permanent injunctive relief from the provision or coverage of
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`gender-transition procedures. The other claims either run afoul of jurisdictional limitations or do
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`not warrant summary judgment.
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`I.
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`BACKGROUND
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`The Court begins with the statutory framework of Section 1557. Next is an overview of
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`the implementing regulations and resulting litigation. An introduction of the parties follows. Last
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`is a summary of these cases’ recent procedural developments.
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`A.
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`Statutory Framework
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`Enacted in March 2010, the ACA is “a comprehensive national plan to provide universal
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`health insurance coverage.” Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519, 583 (2012).
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`Fundamentally, the ACA is designed to broaden access to healthcare and insurance coverage.
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`King v. Burwell, 576 U.S. 473, 478-79 (2015). Part and parcel with that objective is the ACA’s
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`ban on discrimination in healthcare.
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`Codified at 42 U.S.C. § 18116, Section 1557 of the ACA prohibits any federally funded or
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`administered health program or activity from engaging in discrimination. Rather than specifically
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`listing the prohibited grounds for discrimination, Section 1557 coopts four preexisting civil rights
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`statutes: (1) Title VI of the Civil Rights Act of 1964 (42 U.S.C. § 2000d et seq.) (race, color, or
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`national origin); (2) Title IX of the Education Amendments of 1972 (20 U.S.C. § 1681 et seq.)
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`(sex); (3) the Age Discrimination Act of 1975 (42 U.S.C. § 6101 et seq.) (age); and (4) the
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`Rehabilitation Act of 1973 (29 U.S.C. § 794) (disability). In kind, Section 1557 adopts the
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`enforcement mechanisms available under each incorporated statute. 42 U.S.C. § 18116(a). The
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`2
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`Secretary of HHS holds discretionary authority to promulgate implementing regulations. Id. §
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`18116(c).
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`The lone prohibited ground relevant for these cases stems from Title IX, which forbids
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`discrimination “on the basis of sex.” 20 U.S.C. § 1681(a). Two exceptions merit mention up front.
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`First, Title IX is inapplicable “to an educational institution which is controlled by a religious
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`organization” if application “would not be consistent with the religious tenets of such
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`organization.” Id. § 1681(a)(3); see also 20 U.S.C. § 1687. Second, Title IX cannot “require or
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`prohibit any person, or public or private entity, to provide or pay for any benefit or service,
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`including the use of facilities, related to an abortion.” 20 U.S.C. § 1688.
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`For enforcement, Section 1557 (by way of Title IX) greenlights administrative agencies to
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`revoke federal funding for an offending health program or activity. 20 U.S.C. § 1682. Agencies
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`may also pursue “any other means authorized by law,” including civil enforcement proceedings,
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`debarment from doing business with the federal government, lawsuits under the False Claims Act,
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`and even criminal penalties.1 See id. In addition, Section 1557 supports a private right of action
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`for damages and attorney’s fees. See Rumble v. Fairview Health Servs., No. 14-cv-2037
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`(SRN/FLN), 2015 WL 1197415, at *7 n.3 (D. Minn. Mar. 16, 2015) (concluding that Section 1557
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`provides a private right of action because each incorporated statute does so).
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`1 Applicants for federal financial assistance from HHS must complete Form 690, which certifies
`that the applicant will comply with antidiscrimination laws like Section 1557 and Title IX. See 45
`C.F.R. §§ 86.4, 92.4. Subsequent failure to comply with those laws may trigger the False Claims
`Act, exposing an offender to civil penalties of up to $11,000 per false claim “plus 3 times the
`amount of damages which the Government sustains because of” any false claim. 31 U.S.C. §
`3729(a)(1). Further, an individual who makes a materially false statement in connection with the
`delivery of or payment for healthcare benefits or services is subject to criminal monetary penalties,
`up to five years’ imprisonment, or both. 18 U.S.C. § 1035.
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`3
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`B.
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`Regulations and Litigation
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`1.
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`The 2016 Rule
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`More than six years after the ACA became law, HHS promulgated a rule interpreting
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`Section 1557. See Nondiscrimination in Health Programs and Activities, 81 Fed. Reg. 31,376
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`(May 18, 2016) (“2016 Rule”). The 2016 Rule applied broadly. HHS defined “covered entity” to
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`encompass any “entity that operates a health program or activity, any part of which receives
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`Federal financial assistance.” Id. at 31,466 (formerly codified at 45 C.F.R. § 92.4). And a “health
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`program or activity” meant “the provision of health-related services, health-related insurance
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`coverage, or other health-related coverage.” Id. at 31,467. For entities “principally engaged” in
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`those endeavors, the regulation extended to “all of [their] operations.” Id. Due to near-ubiquitous
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`participation in Medicaid and Medicare, HHS estimated that the 2016 Rule would apply to “almost
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`all practicing physicians in the United States” and to over 133,000 hospitals, clinics, and other
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`healthcare facilities. Id. at 31,445-46. The agency also predicted that the regulation would apply
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`to the approximately 180 insurers that offered health plans through ACA or state-based
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`marketplaces. Id. at 31,445.
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`Making the incorporation of Title IX plain, the 2016 Rule prohibited discrimination “on
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`the basis of . . . sex.” Id. at 31,469 (formerly codified at 45 C.F.R. § 92.101(a)). HHS then defined
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`that phrase to include “discrimination on the basis of . . . termination of pregnancy, . . . sex
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`stereotyping, and gender identity.” Id. at 31,467 (formerly codified at 45 C.F.R. § 92.4). Drilling
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`down further, the 2016 Rule defined “gender identity” as “an individual’s internal sense of gender,
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`which may be male, female, neither, or a combination of male and female, and which may be
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`different from an individual’s sex assigned at birth.” Id. And “sex stereotypes” in part meant “the
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`expectation that individuals will consistently identify with only one gender and that they will act
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`in conformity with the gender-related expressions stereotypically associated with that gender.” Id.
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`at 31,468. The regulation left “termination of pregnancy” undefined.
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`HHS contextualized those definitions with specific examples of discriminatory conduct.
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`To start, the 2016 Rule prohibited a covered healthcare provider from refusing to offer medical
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`services for gender transitions2 if that provider offered comparable services to others. Id. at 31,471
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`(formerly codified at 45 C.F.R. § 92.206). HHS used this example: “A provider specializing in
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`gynecological services that previously declined to provide a medically necessary hysterectomy for
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`a transgender man would have to revise its policy to provide the procedure for transgender
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`individuals in the same manner it provides the procedure for other individuals.” Id. at 31,455. The
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`same concept theoretically applied for abortions. So if an obstetrician performed dilation and
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`curettage procedures for miscarriages, then the 2016 Rule barred a later refusal to perform those
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`procedures for abortions. See Doc. No. 95, ¶ 134. As for covered entities’ health plans, HHS
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`declared that any “categorical . . . exclusion or limitation on coverage for all health services related
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`to gender transition is unlawful on its face.” 81 Fed. Reg. at 31,429; see also id. at 31,471-72
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`(formerly codified at 45 C.F.R. § 92.207(b)(4)-(5)). Put differently, the 2016 Rule prohibited
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`covered insurers and third-party administrators3 (“TPAs”) from offering or administering health
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`plans with gender-transition exclusions. Doc. No. 97, ¶ 133. The regulation likewise banned
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`healthcare providers from issuing such exclusions in their employee health plans. Id. ¶ 135.
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`2 HHS noted that “[t]he range of transition-related services, which includes treatment for gender
`dysphoria, is not limited to surgical treatments and may include . . . hormone therapy and
`psychotherapy, which may occur over the lifetime of the individual.” 81 Fed. Reg. at 31,435-36.
`3 Self-insured entities often contract with TPAs to administer their group health plans. TPAs “are
`generally not responsible for the benefit design of the self-insured plans they administer.” 81 Fed.
`Reg. at 31,432.
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`Meanwhile, the 2016 Rule imported applicable statutory exceptions for discrimination
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`based on race, color, national origin, age, and disability. 81 Fed. Reg. at 31,470 (formerly codified
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`at 45 C.F.R. § 92.101(c)). For sex discrimination, though, HHS conspicuously omitted Title IX’s
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`religious and abortion-neutrality exemptions. See id. The agency deflected comments calling for
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`the religious carve-out’s inclusion by positing that “Section 1557 contains no religious exemption”
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`and that “a blanket religious exemption could result in a denial or delay in the provision of health
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`care and in discouraging individuals from seeking necessary care.” Id. at 31,380.
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`HHS rejected the abortion-neutrality exemption too, explaining that separate ACA
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`provisions could shield objecting providers and insurers. Id. In particular, HHS cited to Section
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`1303 of the ACA. That statute provides that a qualified health plan is not required to include
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`abortion coverage as an essential health benefit. 42 U.S.C. § 18023(b)(1)(A)(i). Section 1303
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`additionally bars qualified health plans offered through an ACA exchange from discriminating
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`against an individual healthcare facility or provider because of an unwillingness to provide, pay
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`for, provide coverage of, or refer for abortions. Id. § 18023(b)(4). Myriad other federal laws offer
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`similar protection. The Weldon Amendment, which consistently appears in HHS appropriations
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`legislation, prevents federal agencies from discriminating against healthcare entities based on
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`(identical to Section 1303) refusal to provide, pay for, provide coverage of, or refer for abortions.
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`See Consolidated Appropriations Act of 2019, Pub. L. No. 115-245, Div. B, § 507(d)(1), 132 Stat.
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`2981, 3118 (2018). The Coats-Snowe Amendment prohibits the federal government from
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`discriminating against healthcare entities that decline to perform, refer for, or undergo training for
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`abortions. 42 U.S.C. § 238n(a)(1). And the Church Amendments guarantee that a recipient of
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`certain sources of federal funds cannot be compelled to perform or assist in sterilization procedures
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`or abortions if “contrary to [the recipient’s] religious beliefs or moral objections.” 42 U.S.C. §
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`300a-7(b)(1).
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`Having jettisoned the Title IX exemptions, HHS settled on a narrower exclusion. The 2016
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`Rule excepted applications that “would violate applicable Federal statutory protections for
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`religious freedom and conscience.” 81 Fed. Reg. at 31,466 (formerly codified at 45 C.F.R. §
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`92.2(c)). More specifically, HHS explained that the RFRA “is the proper means to evaluate any
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`religious concerns about the application of Section 1557 requirements.” Id. at 31,380. HHS went
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`on to note that it would evaluate “individualized and fact specific” RFRA claims “on a case-by-
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`case basis.” Id. To obtain an exception, in other words, a provider objecting on religious grounds
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`needed to convince HHS that the regulation circumstantially violated the RFRA. Doc. No. 95, ¶
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`51. Otherwise, an objecting provider’s last resort rested in federal court. Id.
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`The 2016 Rule had implications for employers outside the healthcare context as well. Title
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`VII of the Civil Rights Act of 1964 bans all employers with 15 or more employees—whether
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`receiving federal funding or not—from engaging in sex discrimination.4 42 U.S.C. §§ 2000e-2(a),
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`2000e(b). The EEOC holds primary responsibility for interpreting and enforcing Title VII. See
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`Griggs v. Duke Power Co., 401 U.S. 424, 433-34 (1971). HHS coordinated with the EEOC to
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`expand the 2016 Rule’s reach to otherwise noncovered entities through Title VII’s analogous ban
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`on sex discrimination. See 81 Fed. Reg. at 31,432.
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`Understanding that relationship demands more explanation. Recall that HHS designated
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`health plans with categorical exclusions for gender-transition services as facially discriminatory.
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`Id. at 31,429. That meant health insurers and TPAs receiving federal financial assistance could
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`4 Title VII similarly mandates an employer to reasonably accommodate employees’ religious
`beliefs unless doing so results in undue hardship on the employer’s business. See 42 U.S.C. §
`2000e(j); 29 C.F.R. § 1605.2(c).
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`not issue or administer such exclusions without potential exposure to Section 1557 liability—even
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`if the entities they contracted with fell entirely outside the regulation’s scope. Id. at 31,432. As a
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`corollary, employers that wished to exclude coverage for gender-transition services in their group
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`health plans faced a disincentive to do so if contracting with a covered entity. Id.
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`The situation became especially precarious for TPAs. The Employee Retirement Income
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`Security Act of 1974 (“ERISA”) compels TPAs to administer health plans as written. 29 U.S.C.
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`§ 1104(a)(1)(D). So if a self-insured employer designed a health plan on its own with a categorical
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`gender-transition exclusion, ERISA would require that employer’s TPA to administer the plan by
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`its terms. 81 Fed. Reg. at 31,432. But the 2016 Rule would have simultaneously found the TPA’s
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`administration of the same plan unlawfully discriminatory. Id. at 31,429. Recognizing that
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`dichotomy, HHS committed to “adjusting” enforcement by initially determining “whether
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`responsibility for the decision or other action alleged to be discriminatory rests with the employer
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`or with the [TPA].” Id. at 31,432. If the latter, HHS would commence enforcement proceedings
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`as usual. Id. If the former, however, jurisdictional limitations prevented the agency from pursuing
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`enforcement unless the employer already qualified as a covered health program or activity. Id.
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`That jurisdictional gap is where the EEOC entered the picture. HHS explained the
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`coordinated response this way:
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`Where, for example, [HHS] lacks jurisdiction over an employer responsible for
`benefit design, [HHS] typically will refer or transfer the matter to the EEOC and
`allow that agency to address the matter. The EEOC has informed [HHS] that,
`provided the filing meets the requirements for an EEOC charge, the date a
`complaint was filed with [HHS] will be deemed the date it was filed with the EEOC.
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`Id. By the time HHS promulgated the 2016 Rule, the EEOC had already interpreted Title VII to
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`protect against gender-identity discrimination as an inherent form of sex discrimination. See Macy
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`v. Holder, EEOC Appeal No. 0120120821, 2012 WL 1435995, at *7 (Apr. 20, 2012). In plain
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`terms, then, HHS indicated that the EEOC would pursue Title VII enforcement actions against
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`nonhealthcare employers with gender-transition exclusions in their group health plans. See Doc.
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`No. 97, ¶ 165.
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`2.
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`Litigation Challenging the 2016 Rule
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`The 2016 Rule quickly drew legal challenges. One month after the regulation took partial
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`effect, a group of states and religious healthcare providers brought suit in the Northern District of
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`Texas. Franciscan All., Inc. v. Burwell, Case No. 7:16-cv-00108, Doc. No. 1 (N.D. Tex. Aug. 23,
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`2016). Similar coalitions sued in this district not long after. Religious Sisters of Mercy v. Burwell,
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`Case No. 3:16-cv-00386, Doc. No. 1 (D.N.D. Nov. 7, 2016); Cath. Benefits Assoc. v. Burwell,
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`Case No. 3:16-cr-00432, Doc. No. 1 (D.N.D. Dec. 28, 2016). This Court eventually consolidated
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`the Religious Sisters of Mercy and Catholic Benefits Association cases. Doc. No. 37.
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`On December 31, 2016, the Franciscan Alliance court entered a nationwide preliminary
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`injunction. 227 F. Supp. 3d 660, 695 (N.D. Tex. 2016). The court’s order barred enforcement of
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`the 2016 Rule insofar as it prohibited discrimination based on “gender identity” and “termination
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`of pregnancy.” Id. The court first concluded that the regulation violated the APA by
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`impermissibly expanding the scope of sex discrimination under Title IX to encompass gender
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`identity. Id. at 689. Next, the court faulted HHS’s decision to omit Title IX’s religious and
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`abortion-neutrality exemptions. Id. at 691. The court then determined that the regulation’s
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`mandate for healthcare entities to perform and insure gender-transition and abortion procedures
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`imposed a substantial burden on the private plaintiffs’ exercise of religion. Id. at 692. Finally, the
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`court found that HHS failed to show that the 2016 Rule satisfied strict scrutiny under the RFRA.
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`Id. at 693.
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`In the meantime, this Court stayed enforcement of the 2016 Rule against the named
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`Plaintiffs. Doc. No. 23. The Court later clarified that the stay only prevented enforcement of the
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`regulation’s “prohibitions against discrimination on the bases of gender identity and termination
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`of pregnancy.” Doc. No. 36. Further, the Court acknowledged the extant nationwide preliminary
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`injunction in Franciscan Alliance. Id.
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`With key aspects of the 2016 Rule on hold and the onset of a new presidential
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`administration, HHS resolved to return to the drawing board. In late May 2017, the Defendants
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`requested a voluntary remand and stay in these cases to permit the agency “to assess the
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`reasonableness, necessity, and efficacy” of the challenged regulation. Doc. No. 45. HHS also
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`expressed a desire “to address certain issues identified by” the Franciscan Alliance court in its
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`preliminary injunction decision. Id. The Court granted the Defendants’ motion and imposed a
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`stay on August 24, 2017. Doc. No. 56. The Franciscan Alliance court ordered a similar stay. Civil
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`Action No. 7:16-cv-00108-O, 2017 WL 3616652, at *5 (N.D. Tex. July 10, 2017).
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`Over a year passed while a draft of a new proposed rule circulated through the federal
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`bureaucracy. See Doc. Nos. 57, 58, 59, 61, 62, 64. Then in December 2018, the Franciscan
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`Alliance litigation restarted. Case No. 7:16-cv-00108, Doc. No. 126 (N.D. Tex. Dec. 17, 2018).
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`The plaintiffs in that case promptly moved for summary judgment and permanent injunctive relief.
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`See, e.g., id., Doc. No. 136 (N.D. Tex. Feb. 4, 2019).
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`In June 2019, while those motions remained pending, HHS issued a Notice of Proposed
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`Rulemaking that sought to revise the 2016 Rule. See Nondiscrimination in Health and Heath
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`Education Programs or Activities, 84 Fed. Reg. 27,846 (proposed June 14, 2019) (“NPRM”).
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`Among other things, the NPRM proposed to repeal the 2016 Rule’s definition of “on the basis of
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`sex” in its entirety. Id. at 27,857. But HHS then pointed out that the United States Supreme Court
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`had recently granted three petitions for writs of certiorari—consolidated and later decided as
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`Bostock v. Clayton County, 590 U.S. ___, 140 S. Ct. 1731 (2020)—in part to determine whether
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`Title VII’s proscription of sex discrimination equated to a bar on gender-identity discrimination.
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`84 Fed. Reg. at 27,855; see also 139 S. Ct. 1599 (2019) (mem.) (granting certiorari and
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`consolidating cases). The NPRM acknowledged that “[b]ecause Title IX adopts the substantive
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`and legal standards of Title VII, a holding by the U.S. Supreme Court on the definition of ‘sex’
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`under Title VII will likely have ramifications for the definition of ‘sex’ under Title IX.” 84 Fed.
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`Reg. at 27,855 (footnote omitted). With Bostock looming, HHS declined to propose a new
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`definition of “sex” in the NPRM. Id. at 27,857. The agency instead demurred to “allow the Federal
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`courts, in particular, the U.S. Supreme Court, to resolve any dispute about” that term’s “proper
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`legal interpretation.” Id. at 27,873.
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`Four months after HHS rolled out the NPRM, the Franciscan Alliance court granted
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`summary judgment for the plaintiffs. 414 F. Supp. 3d 928 (N.D. Tex. 2019). The court adhered
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`to the reasoning in its preliminary injunction decision and concluded that the 2016 Rule violated
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`both the RFRA and the APA. Id. at 942-43. Yet the court stopped short of entering a nationwide
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`permanent injunction against enforcement of the 2016 Rule’s prohibitions on discrimination based
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`on gender identity and termination of pregnancy. Id. at 946. Instead, the court elected to vacate
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`those portions of the regulation and remand to HHS for further consideration. Id. Neither party
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`appealed on the merits. But the plaintiffs appealed the denial of injunctive relief to the Fifth Circuit
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`Court of Appeals, where briefing wrapped up in early December. See Franciscan All., Inc. v. Azar,
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`USCA No. 20-10093 (5th Cir. Jan. 24, 2020).
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`3.
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`The 2020 Rule
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`HHS finalized a new rule interpreting Section 1557 on June 12, 2020. See Section 1557
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`of the Patient Protection and Affordable Care Act, U.S. Dep’t of Health & Human Servs., https://
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`www.hhs.gov/civil-rights/for-individuals/section-1557/index.html (last visited Jan. 19, 2021).
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`Publication in the Federal Register occurred one week later. Nondiscrimination in Health and
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`Health Education Programs or Activities, 85 Fed. Reg. 37,160 (June 19, 2020) (“2020 Rule”). The
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`2020 Rule marks a significant shift from HHS’s original Section 1557 interpretation.
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`In scope, the 2020 Rule applies more narrowly than its predecessor in two respects. First,
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`HHS redefined “health program or activity” to eliminate blanket regulatory application to entities
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`“principally or otherwise engaged in the business of providing health insurance.” 45 C.F.R. §
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`92.3(c). Health insurers remain subject to Section 1557 for the specific parts of their operations
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`that receive federal financial assistance. See id. § 92.3(b) (“For any entity not principally engaged
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`in the business of providing healthcare, the requirements applicable to a ‘health program or
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`activity’ under this part shall apply to such entity’s operations only to the extent any such operation
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`receives Federal financial assistance.”). The revision indicates only that the entirety of federally
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`funded insurers’ operations no longer automatically qualifies for regulation merely by virtue of
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`selling or administering health insurance plans. See 85 Fed. Reg. at 37,172. And second, whereas
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`the 2016 Rule extended to all HHS-administered programs, the 2020 Rule applies exclusively to
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`the agency’s programs administered under Title I of the ACA. 45 C.F.R. § 92.3(a). That means
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`some programs administered by, for example, the Centers for Medicare and Medicaid Services
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`and the Centers for Disease Control and Prevention likely now fall outside Section 1557’s reach.
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`See 85 Fed. Reg. at 37,170-71.
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`True to the NPRM, the 2020 Rule repealed the definition of “on the basis of sex” in full.
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`Id. at 37,167. HHS reverted to stating that discrimination is barred on the ground prohibited by
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`Title IX without supplemental definition. See 45 C.F.R. § 92.2(b)(2). Still, HHS took the position
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`that the “extension of sex-discrimination protections to encompass gender identity was contrary to
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`the text of Title IX.” 85 Fed. Reg. at 37,168. The agency repeatedly leaned on the Solicitor
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`General’s amicus curiae brief in Bostock to support that stance. See id. at 37,178, 37,194, 37,195.
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`That notwithstanding, HHS reaffirmed its expectation that Bostock—however decided—would
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`impact the meaning of “on the basis of sex” under Title IX. Id. at 37,168. HHS suggested that the
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`repeal “would not preclude application of the [Bostock] Court’s construction” of the phrase. Id.
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`In a similar vein, HHS dispensed with the 2016 Rule’s prohibition on categorical gender-
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`transition exclusions in covered entities’ health plans. Id. at 37,201. The agency asserted a lack
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`of “statutory authority to require the provision or coverage of such procedures under Title IX
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`protections from discrimination on the basis of sex.” Id. at 37,198. HHS further concluded that
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`the coverage mandate had improperly preempted legitimate medical debate, explaining that “the
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`medical community is divided on many issues related to gender identity, including the value of
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`various ‘gender-affirming’ treatments for gender dysphoria.” Id. at 37,187.
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`The 2020 Rule also expanded and clarified available exceptions to Section 1557. Id. at
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`37,204. Namely, HHS incorporated the Title IX religious and abortion-neutrality exemptions. See
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`45 C.F.R. § 92.6(b) (stating that any application that would contradict exemptions provided by
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`Section 1557’s four incorporated civil rights statutes, including Title IX, “shall not be imposed or
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`required”). The 2020 Rule additionally set out an explicit, though not exhaustive, list of federal
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`religious freedom and conscience provisions that would override application of Section 1557 in
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`some circumstances. Id. That list included the RFRA, Section 1303 of the ACA, the Weldon
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`Amendment, the Coats-Snow Amendment, and the Church Amendments. Id.
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`4.
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`Bostock and Litigation Challenging the 2020 Rule
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`On June 15, 2020, the Supreme Court decided Bostock—just three days after HHS
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`finalized the 2020 Rule.5 The Court held that firing an employee for being homosexual or
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`transgender constitutes sex discrimination under Title VII because such a decision “necessarily
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`and intentionally discriminates against that individual in part because of sex.” Bostock, 140 S. Ct.
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`at 1744. In so holding, the Court assumed that “sex” referred “only to biological distinctions
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`between male and female.” Id. at 1739. Even with that assumption, the Court deemed it
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`“impossible to discriminate against a person for being homosexual or transgender without
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`discriminating against that individual based on sex.” Id. at 1741.
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`Bostock arrived with caveats, however. The Court warned that its decision did not
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`“prejudge” any “other federal or state laws that prohibit sex discrimination.” Id. at 1753. Indeed,
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`a dissent from Justice Alito went so far as to identify Section 1557 as having the potential to
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`“emerge as an intense battleground under the Court’s holding.” Id. at 1781 (Alito, J., dissenting).
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`And the Court separately expressed continued commitment to safeguarding employers’ religious
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`convictions. Id. at 1753-54 (majority opinion). Referencing the RFRA by name, the Court
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`categorized it as “a kind of super statute” that “might supersede Title VII’s commands in
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`appropriate cases.” Id. at 1754.
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`A flurry of litigation commenced in the wake of Bostock. Almost immediately, five cases
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`sprung up seeking to prevent enforcement of the 2020 Rule and to revive various aspects of the
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`2016 Rule. See Whitman-Walker Clinic, Inc. v. U.S. Dep’t of Health & Human Servs., Case No.
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`5 Bostock preceded the 2020 Rule’s publication in the Federal Register by four days.
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`1:20-cv-01630 (D.D.C. June 22, 2020); Walker v. Azar, Case No. 1:20-cv-02834 (E.D.N.Y. June
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`26, 2020); Boston All. of Gay, Lesbian, Bisexual & Transgender Youth v. U.S. Dep’t of Health &
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`Human Servs., Case No. 1:20-cv-11297 (D. Mass. July 9, 2020); Washington v. U.S. Dep’t of
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`Health & Human Servs, Case No. 2:20-cv-01105 (W.D. Wash. July 16, 2020); New York v. U.S.
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`Dep’t of Health & Human Servs., Case No. 1:20-cv-05583 (S.D.N.Y. July 20, 2020). Briefing on
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`dispositive motions is ongoing in two of those cases, while district courts have decided preliminary
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`injunction motions in the other three.
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`In Boston Alliance and New York, where dispositive motions remain pending, the
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`plaintiffs challenge the 2020 Rule’s repeal of specific protections against discrimination based on
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`gender identity and termination of pregnancy, as well as its incorporation of Title IX’s religious
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`and abortion-neutrality exemptions. See Case No. 1:20-cv-11297, Doc. No. 1, ¶¶ 166-80 (D. Mass.
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`July 9, 2020); Case No. 1:20-cv-05583, Doc. No. 1, ¶ 86 (S.D.N.Y. July 20, 2020). As for
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`Washington, the court denied a preliminary injunction motion and dismissed that case for lack of
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`standing. CASE NO. C20-1105JLR, --- F. Supp. 3d ----, 2020 WL 5095467 (W.D. Wash. Aug.
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`28, 2020). The court centrally reasoned that, after Bostock, the plaintiffs failed to show an
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`imminent risk of injury because the 2020 Rule possibly protected against gender-identity
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`discrimination under a straightforward reading of Title IX’s “on the basis of sex” language—even
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`without the 2016 Rule’s definitional provision. Id. at *7.
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`In the two remaining cases, the district courts entered partially overlapping preliminary
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`injunctions. Walker v. Azar, Case No. 20-CV-2834 (FB) (SMG), --- F. Supp. 3d ----, 2020 WL
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`4749859, at *10 (E.D.N.Y. Aug. 17, 2020); Whitman-Walker Clinic, Inc. v. U.S. Dep’t of Health
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`& Human Servs., Civil Action No. 20-1630 (JEB), --- F. Supp. 3d ----, 2020 WL 5232076, at *45
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`(D.D.C. Sept. 2, 2020). Both courts determined that the 2020 Rule violated the APA by failing to
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`consider Bostock prior to publication. See Walker, 2020 WL 4749859, at *9; Whitman-Walker,
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`2020 WL 5232076, at *26. Yet the chosen remedies differed slightly.
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`The Walker court’s order reinstates the 2016 Rule’s definition of “on the basis of sex” to
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`encompass “gender identity” and “sex stereotyping.” 2020 WL 4749859, at *10. The court also
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`later enjoined the repeal of the former 45 C.F.R. § 92.206, which essentially repeats the prohibition
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`against discrimination based on gender identity in the pr