LGBTQ+ Cases at Fourth Circuit Primed to Influence Future Fights

A pair of cases being argued to the full Fourth Circuit on Thursday will likely influence how other courts assess legal challenges aimed at laws that restrict the right of transgender people to access gender-affirming health care.

The appeals concern a relatively narrow issue—whether a North Carolina employee health plan and West Virginia’s Medicaid program unlawfully discriminate against participants and dependents by excluding payment for some transgender-related health care.

But how the judges shape the arguments could affect nearly all litigation concerning LGBTQ+ rights, including cases involving gender-affirming care bans for minors, school bathroom policies, and limits on transgender athletes’ participation in school sports, Omar Gonzalez-Pagan, an attorney and health-care strategist at Lambda Legal, said.

The US Court of Appeals for the Fourth Circuit’s decision will bind federal courts only in Maryland, North Carolina, South Carolina, Virginia, and West Virginia, but judges in other states may find it persuasive, said Quinn Yeargain, a professor at Widener University Commonwealth Law School who studies and writes about these issues.

The Fourth Circuit has “one of the most informed, intelligent, and strongest benches” in the country, they said.

Groups that have opposed expanding LGBTQ+ rights, including Alliance Defending Freedom, declined to comment ahead of the oral arguments.

Early Review

Separate three-judge panels of the Fourth Circuit heard oral arguments on appeals from lower court decisions that struck down the plan exclusions, but the court ordered en banc review on its own motion before the panels ruled.

That’s unusual, and the judges never explained their decision. It might reflect their understanding of the importance of the issues presented, Yeargain said. Or the court may have been seeking to promote judicial economy by aligning the cases’ timing, Gonzalez-Pagan said.

The court’s move is consequential: These are the first LGBTQ+ rights lawsuits at the federal appeals level to get en banc review before a panel judgment, Yeargain said. They’re also the first to be reviewed on the merits, with fully developed records, they said.

To date, most appeals in other circuits have been directed at pretrial rulings, like preliminary injunctions. The Fourth Circuit will have the benefit of seeing all the evidence that was presented to the trial courts, Gonzalez-Pagan said. The Sixth and Eleventh circuits, which have issued decisions that would allow gender-affirming care bans to take effect in Tennessee, Kentucky, and Alabama, haven’t “fully engaged with the facts,” he said.

Primary Issue

The equal protection issue is critical in both appeals, according to Katie Eyer, a professor at Rutgers Law School who is an expert on LGBTQ+ rights. The standard of review to be applied has become a central issue in these cases and, more recently, in lawsuits challenging bans on minors’ gender-affirming care, she said.

The states have argued, in part, that the laws should be upheld because they are rationally related to legitimate government interests, Eyer said.

The US Supreme Court, however, has made it clear that once a court determines that a law draws sex-based differences, it must determine if the provision serves important governmental interests by means that are substantially related to—or have a “close fit” with—those interests, she said.

The fact that a law draws sex-based distinctions alone triggers this higher level of intermediate scrutiny, Eyer said. The Eleventh Circuit “ignored this baseline concept” in its decision lifting an injunction that had blocked Alabama’s gender-affirming care ban, she said.

The Eleventh Circuit found that the law didn’t treat girls and boys differently in terms of accessing the care, but that’s “not how constitutional law works,” Eyer said. The Alabama law on its face requires an assessment of a person’s sex to determine if they’ll be barred from accessing certain treatments, she said.

The Fourth Circuit undoubtedly will take note of the Eleventh Circuit’s decision, as well as two from the Sixth Circuit that temporarily allowed gender-affirming care bans to take effect, Gonzalez-Pagan said. But the Fourth Circuit isn’t bound by them and has strong precedent of its own applying a heightened standard of review to an equal protection claim in a bathroom access case, Eyer said.

Statutory Questions

Yeargain said the court could use a doctrine known as “constitutional avoidance"—skip the constitutional question and decide the cases solely on statutory issues.

These questions are easier, Yeargain said. For example, the North Carolina case involves an employee health plan that may be unlawful under Title VII, the employment discrimination law. The US Supreme Court said in 2020’s Bostock v. Clayton County that Title VII prohibits discriminating against an employee just because they’re gay or transgender, so it would be less of an “intellectual stretch” for the Fourth Circuit to decide the case on that ground, Yeargain said.

Additionally, courts have often applied Title VII standards by analogy to determine if a provision is discriminatory under the equal protection clause, Eyer said.

The Medicaid Act’s comparability provision may give the court an out in the West Virginia case, which pays for certain surgeries for cisgender people, but not for transgender people, Gonzalez-Pagan said. Under that provision, Medicaid-covered benefits usually must be provided comparably. Courts have already found that exclusions for transgender-related health care violate this section, he said.

Both cases also claimed the state provisions violated Section 1557 of the Affordable Care Act, which precludes discrimination in health-care programs.

All three attorneys say it’s likely the cases will end up in the US Supreme Court, especially if the Fourth Circuit rules on the equal protection question.

Lambda Legal Defense & Education Fund Inc., Transgender Legal Defense & Education Fund Inc., McDermott Will & Emery LLP, and HWG LLP represent the North Carolina plaintiffs. Bell, Davis & Pitt; and John G. Knepper of Cheyenne, Wyo., represent the North Carolina defendants.

Employment Law Center PLLC, Lambda Legal Defense & Education Fund Inc., and Nichols Kaster PLLP represent the West Virginia plaintiffs. Shuman McCuskey Slicer PLLC represents the West Virginia defendants.

The cases are Fain v. Crouch, 4th Cir. en banc, No. 22-1927, oral arguments scheduled 9/21/23; Kadel v. Folwell, 4th Cir. en banc, No. 22-1721, oral arguments scheduled 9/21/23.