Title IX's Exemption for Religious Institutions as to Sex, Sexual Orientation, and Gender Identity Is Constitutionally Permissible

The court concludes that the government may institute such an exemption, though doesn't decide whether it must do so.

So holds today's Ninth Circuit opinion in Hunter v. U.S. Dep't of Ed., decided by Judge Milan Smith, joined by Judges Mark Bennett and Anthony Johnstone:

Title IX, a landmark law prohibiting gender discrimination at federally funded educational institutions, carves out an exception for religious institutions whose tenets mandate gender-based discrimination. Plaintiffs are lesbian, gay, bisexual, transgender, and/or nonbinary (LGBTQ+) students who applied to or attended religious institutions and alleged that they experienced discrimination on the basis of their sexuality or gender identity.

They brought suit against the Department of Education (Department), claiming that Title IX's religious exemption violates the equal protection guarantee of the Fifth Amendment and establishes a religion in violation of the First Amendment. They also challenge the Department's implementing regulations of Title IX as arbitrary and capricious under the Administrative Procedure Act (APA)….

This case addresses, among other issues, the question of whether Congress's attempt to balance the important interests of religious freedom and gender-based equality violated the Constitution. Because we hold that Congress did not exceed its constitutional boundaries, we affirm….

Title IX prohibits certain educational institutions from receiving federal funding if they exclude, deny benefits to, or subject to discrimination any person "on the basis of sex." We have recently interpreted this provision to prevent federally funded educational institutions from discriminating against gay or transgender students. See also Bostock v. Clayton County (2020) ("[I]t is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex" in the context of Title VII.). Title IX does not prohibit discrimination, however, when an educational institution "is controlled by a religious organization if the application of [Title IX] would not be consistent with the religious tenets of such organization." …

The court held that the exemption doesn't violate the Establishment Clause:

To determine whether government action violates the Establishment Clause, the panel must "focus[ ] on original meaning and history." Any practice that was "accepted by the Framers and has withstood the critical scrutiny of time and political change" does not violate the Establishment Clause. …  Because no identical exemption existed at the Founding, we must use the historical analogues that are available….

Given the dearth of historical equivalents, … tax exemptions are the most analogous case to Title IX's statutory exemption…. [T]ax exemptions for religious institutions are really "[s]ubsid[ies] of buildings of worship," which is "a universal practice of state and federal government." Just as a school is not required to accept federal funding, a religious institution is not required to own property. Even so, religious institutions are constitutionally exempted from paying property taxes.

Both the statutory exemption to Title IX and property tax exemptions operate as a financial benefit to non-secular entities that similarly situated secular entities do not receive. And they were deemed constitutional without a requirement that the exemption only apply if the tax conflicted with a specific tenet of the religion. Even if Title IX's exemption is a "benefit" instead of a "burden," "[a] variety of benefits have been bestowed by government on religious practices and either have been unchallenged or passed constitutional muster without fatal compromise of principle." Absent additional historical evidence—and Plaintiffs point us to none here—the history of tax exemptions near the time of the Founding suggests that the statutory exemptions that operate as a subsidy to religious institutions do not violate the Establishment Clause according to its original meaning.

Having considered the history of religious exemptions at or near the Founding, the history and tradition test requires us to look next to the "uninterrupted practice" of a law in our nation's traditions. The Department identifies a relevant tradition in "modern legislative efforts to accommodate religious practice." [Examples omitted. -EV] … [These efforts] evince a continuous, century-long practice of governmental accommodations for religion that the Supreme Court and our court have repeatedly accepted as consistent with the Establishment Clause. The examples provided by the Department demonstrate that religious exemptions have "withstood the critical scrutiny of time and political change." And given that this exact law did not exist at the Founding, that more recent (albeit, still lengthy) tradition is of greater salience.

Plaintiffs make several arguments that, despite the long tradition of statutory religious accommodations, the Title IX exemption still violates the Establishment Clause. First, Plaintiffs argue that the exemption prefers religion to irreligion, impermissibly "singling out religious institutions for special benefits." We disagree. In Amos, the Supreme Court held that Title VII's similar exemption for religious institutions from religious non-discrimination in employment, even when the job function is secular, does not violate the Establishment Clause. While Amos was decided under Lemon and does not reference historical practices or understandings, it does make the logical point that no religious accommodation could stand if we held that this type of accommodation prefers religion over irreligion. Given that the government "sometimes must" accommodate religion, the exemption does not prefer religion to irreligion for simply carving religious behavior out of the statute….

Second, Plaintiffs argue that the exemption "discriminates between religious sects and is available only to some religious groups—those whose tenets are inconsistent with an application of Title IX." This argument fails. The statute facially applies to any religious organization for which the religious tenets would not be consistent with the application of Title IX. And there is no evidence in the record that the exemption here "was drafted with the explicit intention of including particular religious denominations and excluding others." Under Plaintiffs' view, the only constitutional alternative would be to exempt any religious institution from the statute without regard to its tenets—a less narrowly tailored law. The Constitution does not require such a result.

Third, Plaintiffs contend that the exemption impermissibly "conscripts federal employees as ecclesiastical inquisitors, charged with ascertaining the 'religious tenets' of each school and determining whether a particular application of Title IX is consistent with the teachings of that denomination."

The Department must "accept the ecclesiastical decisions of church tribunals as it finds them." It clearly does so. Here, when a school claims an exemption, the Department must make two determinations—whether the school is controlled by a religious organization and whether Title IX would conflict with the religious tenets of the controlling organization. The Department has, as pleaded in the FAC, "never rejected an educational institution's assertion that it is controlled by a religious organization" and "never denied a religious exemption when a religious educational institution asserts a religious objection."

We are not persuaded that this type of facially neutral religious accommodation violates the Establishment Clause.

And the court held that the exemption didn't violate equal protection principles:

Plaintiffs contend that the Title IX exemption violates [the Fifth Amendment's] equal protection guarantee because it "targets Americans for disfavored treatment based on their sex, including targeting based on sexual orientation and gender identity." They claim that the exemption is facially discriminatory, motivated by discriminatory animus, and unconstitutional as applied to Plaintiffs. Specifically, they argue that we should apply intermediate scrutiny and hold that the exemption does not meet that high standard. Defendants, on the other hand, argue that we should apply rational basis review, which they contend the exemption easily withstands.

Because the exemption would survive the more demanding intermediate scrutiny standard, we need not decide which standard applies. A statute passes intermediate scrutiny when it "serve[s] important governmental objectives" and is "substantially related to achievement of those objectives." The exemption seeks to accommodate religious educational institutions' free exercise of religion. The free exercise of religion is "undoubtedly, fundamentally important."

The exemption substantially relates to the achievement of limiting government interference with the free exercise of religion. As the Department states, the "statutory limitations on its application ensure a substantial fit between [ends and] means." It only exempts educational institutions (a) controlled by religious institutions and (b) only to the extent that a particular application of Title IX would not be consistent with a specific tenet of the controlling religious organization. The exemption does not give a free pass to discriminate on the basis of sex to every institution; it contains limits that ensure that Title IX is not enforced only where it would create a direct conflict with a religious institution's exercise of religion. Thus, the exemption substantially relates to a "fundamentally important" governmental interest.

{We decline to address the Religious Schools' argument that the exemption is required by the First Amendment's Free Exercise clause.}

The court also rejected plaintiffs' claims under the Administrative Procedure Act related to the Department's rules implementing the exemption; for more, read the whole opinion.

Ashley C. Honold argued the case for the Justice Department, Christopher P. Schandevel (Alliance Defending Freedom) for intervenor educational institutions, and Gene C. Schaerr (Schaerr Jaffe LLP) for intervenor Council for Christian Colleges & Universities. Note that I'm a part-part-part-time academic affiliate for the Schaerr Jaffe firm, but I wasn't involved in this case (and indeed just learned of the firm's participation in it when reading the opinion). They were joined on the briefs by too many other lawyers for me to list.