Same-Sex Marriage on the Cusp: Remaining Issues and a Look into the Future ABA Annual Meeting 2015 Prof. William P. LaPiana, New York Law School Prof. Lee-ford Tritt, University of Florida College of Law Julie Wilensky, Lewis, Feinberg, Lee & Jackson, P.C. Moderator: Amy Morris Hess, University of Tennessee College of Law Same-Sex Marriage Prior to 2004, same-sex marriage was not performed in any U.S. jurisdiction. There are three components to the legalization of samesex marriages: (1) the licensing of same-sex marriages; (2) the recognizing the legal validity of those licenses; and (3) recognizing same-sex marriages from other jurisdictions. Pre-Obergefell Geography of Same-Sex Marriage On June 25, 2015, thirty-eight states and the District of Columbia had legalized same-sex marriage: Alabama, Alaska, Arizona, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Minnesota, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming. 27 were by court decision. 8 by state legislature. 3 by popular vote. In addition, eight Native American tribal jurisdictions permitted same-sex marriages. All these jurisdictions recognized the validity of their licenses, except for Kansas, where the state government refused to recognize same-sex marriages (except for the Secretary of the Kansas Department of Health and Environment and clerks in two counties who are under federal court order not to enforce the state's same-sex marriage ban). Kansas also failed to recognize same-sex marriages from other jurisdictions. In Missouri, only Jackson County, St. Louis County, and the city of St. Louis issued marriage licenses to samesex couples. Missouri did recognize same-sex marriages established in other jurisdictions. Some probate judges in Alabama issued licenses; others did not. 1
Pre-Obergefell Geography of Same-Sex Marriage On Mar. 3, 2015, the Alabama Supreme Court ordered the state's 68 probate judges to stop issuing marriage licenses to same-sex couples, despite an earlier federal court ruling that struck down the state's gay marriage ban and the US Supreme Court's decision to allow same-sex marriages to proceed in the state On June 25, 2015, thirteen states banned same-sex marriage: Arkansas, Georgia, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Tennessee, and Texas. 12 by Constitutional Amendment and state law. 1 by Constitutional Amendment only. Of these 13 states, there are 8 states where gay marriage bans were overturned but appealed: Arkansas, Kentucky, Michigan, Mississippi, Missouri, Nebraska, South Dakota, Texas. Only two states had no marriage rulings Georgia and North Dakota. On June 25, 2015 and on June 26, 2015 Recent History of Same-Sex Marriage Litigation: The United States Supreme Court in Windsor said nothing about the status of state same-sex marriage bans under the federal constitution. More precisely, the court did not say that the denial of a marriage license to a same-sex couple violates the equal protection clause of the Fourteenth Amendment. The Court declined the opportunity to address the question in Hollingsworth v. Perry (570 U.S., 133 S.Ct. 2652 (2013)) 2
Recent History of Same-Sex Marriage Litigation, continued: After the decision in Windsor, four federal Circuit Courts of Appeal upheld District Court decisions invalidating prohibitions on same-sex marriage: Latta v. Otter, 771 F.3d 456 (9th Cir. 2014) Baskin v. Bogan, 766 F.3d 648 (7 th Cir. 2014), cert. denied, 135 S. Ct. 316 (Oct. 6, 2014) Bostic v. Schaefer, 760 F.3d 352 (4th Cir. 2014), cert. denied, 135 S. Ct. 286, 314, and 352 (Oct. 6, 2014). Bishop v. Smith, 760 F.3d 1070 (10th Cir. 2014), cert. denied, 135 S. Ct. 271 (Oct. 6, 2014) Kitchen v. Herbert, 755 F.3d 1193 (10th Cir. 2014), cert. denied, 135 L. Ed. 2d 138 (Oct. 6, 2014) The denial of certiorari by the United States Supreme Court on October 6, 2014 brought legal same-sex marriages to all of the states in those circuits. SCOTUS Litigation: Obergefell and Consolidated Cases Only one Circuit Court of Appeals case upheld a ban on same-sex marriage: DeBoer v. Snyder, 772 F.3d 388 (6th Cir. 2014), The United States Supreme Court granted certiorari in the case on January 16, 2015 sub nom. Bourke v. Beshear, S.Ct., 83 U.S.LW. 3315, 2015 WL 213651 limited to the following questions: 1) Does the Fourteenth Amendment require a state to license a marriage between two people of the same sex? 2) Does the Fourteenth Amendment require a state to recognize a marriage between two people of the same sex when their marriage was lawfully licensed and performed out-of-state? Federal Treatment of Same-sex Marriages: The majority opinion in Windsor invalidates the statutory provision defining marriage for federal purposes only with respect to lawful marriages. The various marriage substitutes are not equivalent to marriage for federal purposes either before or after Windsor, with the exception for Social Security purposes. At least (in part) for purposes of Social Security benefits, legal relationships granting the partners the right to inherit from one another are treated as marriages. The Social Security Administration has produced a chart showing all the states various marriage equivalent arrangements, the dates for which they are effective and which ones give inheritance rights and therefore qualify the partners for spousal Social Security benefits 3
June 26, 2015 On June 26, 2015 the United States Supreme Court issued its decision in Obergefell v. Hodges, U.S., S. Ct., 2015 WL 2473451, 2015 U.S. Lexis 4250 The denial of marriage to same-sex couples was found to violate the Constitution and same-sex marriage and legal recognition of same-sex marriage became the law of the land Federal Treatment of Same-sex Marriages: Although same-sex marriage is now the law of the land, they have only recently been able to be performed in all U.S. jurisdictions. What is a marriage for purposes of federal recognition of marriages entered into before Obergefell? Once a same-sex couple validly marries, are they married for federal purposes until the marriage ends by death or dissolution or does it matter where they live when they interact with the federal government? 1. Place of Celebration. 2. Place of Domicile. Federal Treatment of Same-sex Marriages: Department of Treasury and the IRS. Place of Celebration. Rev. Rul 2013-17, 2013-38 IRB 201 Department of Labor. The place of celebration standard applies with respect to spousal benefits and consents mandated by ERISA, which governs many employee benefit plans, including tax-qualified retirement plans. EBSA Technical Release 2013-4. New regulations effective in March 2015 changed the standard for the Family Medical Leave Act to place of celebration. Social Security Administration. Place of residence standard (but recognizes certain non-marital relationships ) 4
Federal Treatment of Same-sex Marriages: Federal Employment Benefits (Office of Personnel Management). Place of Celebration. Department of Defense. Place of Celebration Department of Veteran Affairs. Place of residence. Department of State and US Citizenship and Immigration Services. Place of celebration. Department of Justice. Place of celebration. Employee Benefits: Effect of Obergefell, Windsor, and Post-Windsor Federal Guidance For same-sex spouses, Windsor significantly changed the landscape of federal employee benefits law (ERISA), federal tax law, and related regulations IRS Revenue Ruling 2013-17 (Aug. 29, 2013) Dep t of Labor Technical Release 2013-04 (Sept. 18, 2013) IRS Notice 2014-19 (Apr. 4, 2014) Windsor leveled the floor; Obergefell completes dismantling of legal framework that previously supported discrimination against same-sex couples in employee benefits Obergefell simplifies plan administration by providing nationally uniform marriage access and recognition, facilitating ERISA s goal of promoting nationally uniform plan administration Employee Benefits: Effect of Obergefell, Windsor, and Post-Windsor Federal Guidance ERISA-governed pension benefits: As a result of Windsor, spousal pension benefits mandated by ERISA and IRC became mandated for same-sex spouses, regardless of whether a couple s state of residence recognized same-sex marriage Examples: spousal consents to beneficiary or form of benefit, default form of benefit for defined benefit plans (joint and survivor annuity), qualified domestic relations orders, default beneficiaries for 401(k) plans, rollovers 5
Employee Benefits: Effect of Obergefell, Windsor, and Post-Windsor Federal Guidance ERISA-governed health benefits: ERISA doesn t mandate that health plans cover any spouses, opposite- or same-sex State insurance law regulates insured plans and may require coverage Potential employment discrimination claims of sex discrimination under Title VII/Equal Pay Act If ERISA plan covers same-sex spouses: Since Windsor, providing health benefits for same-sex spouses no longer has the significant federal tax consequences that were there when DOMA Section 3 in effect (can use pre-tax dollars to pay premiums) Also: COBRA rights, equal treatment of spousal claims under flexible spending accounts, HIPAA special enrollment rights Spouses: Plan Terms ERISA claims for benefits under plan terms Example: employer refuses to provide health coverage to same-sex spouses, but plan language does not define spouse in way that excludes same-sex spouses ERISA breach of fiduciary claims participant communication issues Example: summary plan description given to participants doesn t disclose that the plan excludes same-sex spouses from health coverage Employment discrimination claims (Title VII/Equal Pay Act) Plan explicitly limits health benefits to opposite-sex spouses Hall v. BNSF; Cote v. Wal-Mart Obergefell eliminates a plan s rationale that limiting coverage to opposite-sex spouses is to be consistent with a particular state s definition of spouse Spouses: Retroactivity Have arisen where plan participant in same-sex marriage died or retired before Windsor and spouse was denied benefit due to plan s failure to recognize the marriage Rare, but issues have come up Plan can comply with tax law without recognizing same-sex marriages before Windsor, but IRS guidance does not provide relief from claims under ERISA s civil enforcement provision based on events before Windsor 6
Spouses: Retroactivity Retroactivity issues haven t been fully litigated Retroactivity arguments: Generally, Supreme Court s application of new rule of federal law to parties before it (as in Windsor and in Obergerfell) is given full retroactive effect as to all events, even if events took place before the decision Harper v. Va. Dep t of Taxation Precedents for retroactivity in the benefits context Hurvich v. Califano OPM granting survivor benefits for same-sex spouses of federal employees who died before Windsor Spouses: Retroactivity Cases have applied Windsor to earlier events, but did not explicitly address retroactivity Cozen O Connor v. Tobits In re Fonberg Pending cases raising retroactivity issues Schuett v. FedEx (N.D. Cal.) Employee in same-sex marriage died 6 days before Windsor, pension plan defined spouse by incorporating DOMA, FedEx denied the surviving spouse an ERISA-mandated survivor annuity Lawsuit brings ERISA claims; EEOC charge pending Hudson v. OPM (N.D. Cal.) Lawsuit seeks back pay to reimburse costs of alternate health coverage for same-sex spouse of federal employee denied health benefits before Windsor Spouses: Marriage Duration Some spousal benefits have a marriage-duration requirement Federal Employees Retirement System Social Security benefits ERISA-governed pension plans providing spousal annuities Plans permitted to have a one-year marriage duration requirement Issues arise as same-sex marriage becomes increasingly available Couples previously prevented from marrying by state laws found to be unconstitutional; same-sex married couples previously or currently in civil unions/registered domestic partnerships with each other 7
State Tax Issues Obergefell should eliminate discrepancies between federal and state tax requirements for same-sex married couples Between Windsor and Obergefell, states that did not recognize same-sex marriages took varying approaches to as to whether same-sex married couples could or were required to file joint state returns Retroactive state tax issues may arise Other Issues Dissolution of Marriage no longer an issue Drafting Retroactivity Marriage-Duration Requirements Construction Issues for Older Documents: Dispositive Intent Rules of Construction Ambiguity/Extrinsic Evidence Competing Public Policy Issues 8