ROBERT E. TARCZA TARCZA & ASSOCIATES, LLC FIDUCIARY DUTY AND DOMA 2014 LAPERS CONFERENCE

The Defense of Marriage Act (DOMA) Act of Congress, signed into law by Bill Clinton on on September 21, Section 1. Short title This Act may be cited as the "Defense of Marriage Act". Section 2. Powers reserved to the states No State, territory, or possession of the United States, or Indian tribe, shall be required to give effect to any public act, record, or judicial proceeding of any other State, territory, possession, or tribe respecting a relationship between persons of the same sex that is treated as a marriage under the laws of such other State, territory, possession, or tribe, or a right or claim arising from such relationship. *Section 3. Definition of marriage In determining the meaning of any Act of Congress, or of any ruling, regulation, or interpretation of the various administrative bureaus and agencies of the United States, the word 'marriage' means only a legal union between one man and one woman as husband and wife, and the word 'spouse' refers only to a person of the opposite sex who is a husband or a wife. * Struck down by the U.S. Supreme Court in United States v. Windsor, 133 S.Ct (2013) Tarcza & Associates, LLC

Background: -Edith Windsor and Thea Spyer married in Ontario, Canada in Their marriage was recognized as valid by the State of New York. -Spyer died in Windsor asserted and was denied the federal estate tax exemption for surviving spouses because of the Treasury’s application of Section 3 of DOMA. -Windsor paid $363,053 in estate taxes, and the IRS refused to give her a refund. -Both lower courts ruled in favor of Windsor and against the U.S. Treasury. United States v. Windsor: Decided June 26, 2013, finding DOMA’s § 3 Unconstitutional Tarcza & Associates, LLC

U.S. v. Windsor: Significance of DOMA’s § 3: The Definitions of “Marriage” and “Spouse” What did DOMA § 3 do? Amended the Dictionary Act, Title 1, § 7 of the United States Code. Affected the application of over 1,000 federal statutes in which marital or spousal status is addressed as a matter of federal law, i.e., Social Security, housing, taxes, criminal sanctions, copyright, and veterans’ benefits. The Dictionary Act affects the application of federal laws only. States are free to recognize same-sex marriage, but § 3 had provided that same-sex marriage would not be recognized in federal law. Because of DOMA, Windsor was not considered a “surviving spouse” for federal tax purposes, which affected her payment of estate taxes. Tarcza & Associates, LLC

Ruling of the Court: § 3 is unconstitutional. The dual regime whereby a couple is recognized as married for purposes of state law but not for purposes of federal law is unconstitutional as violative of Due Process and Equal Protection provided by the Fifth Amendment. The domain of marriage has been the realm and sole jurisdiction of the states since the time of the adoption of the U.S. Constitution, and it was not one of the powers given to the federal government through the Constitution. (At. pp ) “DOMA seeks to injure the very class New York seeks to protect. By doing so it violates basic due process and equal protection principles applicable to the Federal Government.” At p. 20, citing U.S. Const. Amend. 5. Effect: The federal government must recognize and give full benefits to all marriages that the various states recognize to be legitimate marriages. U.S. v. Windsor: The Supreme Court’s Ruling: Tarcza & Associates, LLC

Case and Controversy/ Standing: ● Section 3, the modification to the Dictionary Act, was the only issue before the Supreme Court. The State of New York recognized Windsor’s marriage directly, not merely acknowledging the authority of another jurisdiction; therefore, the only question before the court was the interplay between New York’s recognition of the marriage and the federal government’s prohibition of it. ● The validity of § 2, the provision permitting states not to recognize same-sex marriages performed in other states, was not before the Court. ● The right of a state to prohibit same-sex marriage was not before the Court. The Supreme Court did not rule that § 2 is unconstitutional ● The constitutionality of § 2 is currently being litigated in the Circuit Courts, along with state prohibitions of same-sex marriage. ● The question of whether the Full Faith and Credit Clause of the Fourth Amendment (which requires each state to recognize the laws of each other state) applies to same-sex marriage was not before by the Supreme Court in Windsor. Absent from the Ruling: Mention of § 2 Tarcza & Associates, LLC

First Circuit: No decisions Maine, Massachusetts, New Hampshire, Rhode Island, Puerto Rico Legal by statute in: Maine Massachusetts New Hampshire Rhode Island Illegal by statute in: Puerto Rico Tarcza & Associates, LLC Puerto Rico’s ban is currently being challenged in Conde v. Rius: 3:14-cv-01253, Dist. Puerto Rico. - Filed March 25, 2014, in Puerto Rico Federal District Court. - Puerto Rico has a statutory prohibition to same-sex marriage. - Couple was legally married in Massachusetts, moved to Puerto Rico. - Currently at District Court level. - Four additional couples joined the litigation in June 2014: two seeking recognition of marriages performed in other states, two seeking to marry in Puerto Rico.

Second Circuit: No decisions Vermont, New York, Connecticut Legal by statute in: Vermont New York Connecticut Tarcza & Associates, LLC

Third Circuit: No decisions Delaware, New Jersey, Pennsylvania, Virgin Islands Legal by statute in: Delaware New Jersey Illegal by statute in: Virgin Islands Pennsylvania* Tarcza & Associates, LLC *Pennsylvania’s statutory ban was struck down by court decision. Same-sex marriages may be performed in and are recognized by Pennsylvania although such marriages are not specifically allowed by statute. Whitewood v. Wolf: M.D. Pennsylvania (May 20, 2014) - Pennsylvania’s statutory ban was found unconstitutional by application of the Due Process and Equal Protection clauses of the Fourteenth Amendment. - The case was not appealed to the Third Circuit. - A stay was requested and denied; rehearing was denied.

Fourth Circuit: Found ban unconstitutional Virginia, Maryland, North Carolina, South Carolina Legal by statute in: Maryland Illegal by statute in: North Carolina South Carolina Virginia* Tarcza & Associates, LLC *Ban has been overturned by a court decision, which has been stayed. Bostic v. Schaefer, Fourth Circuit, July 28, 2014: - Case was filed in the Eastern District of Virginia on July 1, 2013, five days after the Windsor decision came down. - A gay couple challenged Virginia’s statutory and constitutional ban on same-sex marriage after being denied a marriage license. - The district court ruled in favor of the plaintiffs. - The Fourth Circuit upheld the decision of the district court, and found the ban on same- sex marriage to violate the Equal Protection and Due Process provisions of the Fourteenth Amendment. - August 13, 2014, the Court ruled that it would not stay its decision; however, the U.S. Supreme Court issued a stay on August 20, The decision is likely binding on North and South Carolina as well.

Fifth Circuit: Issue under review Louisiana, Texas, Mississippi Legal by statute in: n/a Illegal by statute in: Louisiana Mississippi Texas* Tarcza & Associates, LLC *A district court in Texas has struck down the state’s ban. The decision has been stayed, so no same-sex marriages may be performed currently Robicheaux v. Caldwell, Eastern District of Louisiana: - Challenged DOMA § 2, Louisiana’s refusal to acknowledge same-sex marriages performed in other states, and Louisiana’s own constitutional provision prohibiting same-sex marriage. - Initial plaintiffs were lawfully married in Iowa, later joined by another couple married in Iowa and a gay couple wishing to be married in Louisiana. - The district court upheld Louisiana’s ban. DeLeon v. Perry, Western District of Texas: - Filed October 28, 2013, challenging Texas constitutional and statutory laws banning same-sex marriage, joined by a challenge to DOMA, § 2. - The plaintiffs are two couples, one wishing to be married in Texas, another validly married in Massachusetts and wanting their marriage recognized in Texas. - The district court ruled in favor of the plaintiffs, and stayed the judgment pending the Fifth Circuit’s review.

Robicheaux v. Caldwell, , (La. E.D. 9/3/14). Both Louisiana’s ban on same-sex marriage and Louisiana’s refusal to acknowledge same-sex marriages performed in other states have been upheld by the district court. Judge Feldman of the Eastern District of Louisiana found that “Louisiana has a legitimate interest under a rational basis standard of review for addressing the meaning of marriage through the democratic process.” Id. at 1. “’[I]f a law neither burdens a fundamental right nor targets a suspect class,” the Supreme Court has held, “the legislative classification [will survive] so long as it bears a rational relation to some legitimate end.’” Id. at 6, quoting Romer v. Evans, 517 U.S. 432, 440 (1985). Fundamental rights include “the rights to marry, to have children, to direct the education and upbringing of one’s children, to marital privacy, to use contraception, to bodily integrity, and to abortion.” Id. at 19. Such rights must be analyzed under a “careful description,” which, in this case, means “same-sex marriage” not simply “marriage,” and same-sex marriage is not rooted in the history and traditions of this country. Id. at “[N]either the Supreme Court nor the Fifth Circuit has ever before defined sexual orientation as a protected class, despite opportunities to do so.” Id. at 12, citing Windsor, Romer, supra. The “legitimate end” cited by the decision is “linking children to an intact family formed by their two biological parents.” Citing Justice Kennedy’s dissent in Windsor.” Id. at 15, 23.

Sixth Circuit: Issue under review Kentucky, Michigan, Ohio, Tennessee Legal by statute in: n/a Illegal by statute in: Kentucky* Michigan* Ohio* Tennessee** Tarcza & Associates, LLC *District court decisions have overturned state bans. The decisions have been stayed by the Sixth Circuit. **District court ordered the recognition of the marriages of the three plaintiffs only. The decision has been stayed by the Sixth Circuit. Currently Pending Cases in the Sixth Circuit - Oral arguments in all cases were August 6, 2014: - All of the following same-sex marriage cases currently pending found DOMA § 2 unconstitutional on Equal Protection Clause grounds : DeBoer v. Snyder, E.D. Michigan; Henry v. Himes S.D. Ohio; Obergefell v. Himes, S.D. Ohio; Bourke v. Beshear, Love v. Beshear, W.D. Kentucky (consolidated for appeal); Tanco v. Haslam, M.D. Tennessee

Seventh Circuit: Issue under review Illinois, Indiana, Wisconsin Legal by statute in: Illinois Illegal by statute in: Indiana* Wisconsin* Tarcza & Associates, LLC *Bans have been struck down by district court decisions. Effect of those decisions has been stayed. Four cases currently pending, oral argument August 13-26, All four district court decisions found that bans on same-sex marriage unconstitutionally violate due process and equal protection. The rulings were stayed pending appeal to the Seventh Circuit. - Indiana’s ban on same-sex marriage was struck down by the district court in: Baskin v. Bogan (S.D. Indiana) Lee v. Abbott (S.D. Indiana) Fujii v. Comm’r of the Indiana State Dept. of Revenue. (S.D. Indiana) - Wisconsin’s constitutional and statutory ban on same-sex marriage was struck down by: Wolf v. Walker. (W.D. Wisconsin).

Eighth Circuit: Found Ban Constitutional Arkansas, Iowa, Minnesota, Missouri, Nebraska, North Dakota, South Dakota Legal by statute in: Iowa Minnesota Illegal by statute in: Arkansas Missouri Nebraska North Dakota South Dakota Tarcza & Associates, LLC Citizens for Equal Protection v. Bruning, Eighth Circuit (2006) - Originated in Federal District Court of Nebraska, which found the state’s ban unconstitutional. The Eighth Circuit reversed the district court and reinstated the ban. - Decision creates a split in the Circuit Courts, giving the United States Supreme Court a reason to rule on the issue. - Challenged a 2000 ballot initiative to ban same-sex marriage through statute and constitutional amendment. - Decision was handed down before Windsor, so the Eighth Circuit could revisit the issue, but no case is pending before the Eighth Circuit at present.

Ninth Circuit: Issue under review California, Washington, Oregon, Alaska, Arizona, Hawaii, Idaho, Montana, Nevada, Guam, Northern Mariana Islands Legal by statute in: California Hawaii Washington Illegal by statute in: AlaskaNevada ArizonaOregon** Idaho*Guam MontanaN. Mariana Islands Tarcza & Associates, LLC *District court decisions have overturned the ban and are pending in the Ninth Circuit. The rulings have been stayed. **Marriages may presently be performed in Oregon. A permanent injunction has been issued prohibiting the enforcement of laws that prohibit same-sex marriages. Geiger v. Kitzhaber; Rummell v. Kitzhaber. All stays have been denied. Cases currently pending. Oral arguments set for September 8, 2014: - Sevcik v. Sandoval, Dist. Nevada; Jackson v. Fuddy, Dist Hawaii, both decided before the Windsor decision and are no longer being defended by Nevada and Hawaii. - Sevcik is no longer defended by the state because the Ninth Circuit ruled that discrimination based on sexual orientation must receive heightened scrutiny. - Jackson is not defended because Hawaii has since legalized same-sex marriage by amending its statute. - Latta v. Otter, 1:13–cv–00482, Dist. Idaho (2014) - Idaho’s ban was found to be unconstitutional as violative of the Due Process and Equal Protection provisions of the Fourteenth Amendment

Tenth Circuit: Found ban unconstitutional Colorado, Kansas, New Mexico, Oklahoma, Utah, Wyoming Legal by statute in: New Mexico Illegal by statute in: Colorado* Utah* Kansas Wyoming Oklahoma* Tarcza & Associates, LLC *District court decisions overturning bans have been stayed. Colorado’s case is pending, Utah’s and Oklahoma’s have been affirmed by the Tenth Circuit. Kitchen v. Herbert, Tenth Circuit (2013) - The U.S. District Court for Utah found Utah’s constitutional ban on same-sex marriage to be unconstitutional. - Ruling went into effect immediately, and the United States Supreme Court stayed the decision 17 days later. ● Over 1300 marriages were performed between the December 20, 2013 ruling and the January 6, 2014 stay. ● This action of the United States Supreme Court set a precedent for issuing stays in same-sex marriage cases. Bishop v. United States, Tenth Circuit (2014) - Originated in N.D. Oklahoma. The district court found the ban on same-sex marriage is unconstitutional because it violates Due Process and Equal Protection; the Tenth Circuit upheld the district court’s judgment finding DOMA § 2 and the state’s own ban unconstitutional. Burns v. Hickenlooper, Colorado District Court - Currently pending appeal in the Tenth Circuit after Colorado District Court found Colorado’s ban unconstitutional. - Bound by precedent set by Kitchen and Bishop.

Eleventh Circuit: No Decisions Alabama, Florida, Georgia Legal by statute in: n/a Illegal by statute in: Alabama Florida* Georgia Tarcza & Associates, LLC *District court found ban unconstitutional in Brenner v. Scott, because the law violates Equal Protection and Due Process of the Fourteenth Amendment. The district court issued a stay. Brenner v. Scott, N.D. Florida (8/21/14) - The district court found Florida’s ban unconstitutional and issued a stay of the decision. - The stay will remain in effect until 91 days after the stays are lifted in Bostic v. Schaefer, (CA ); Bishop v. Smith, (CA ); and Kitchen v. Herbert, (CA ). - The decision allowing one of the plaintiffs to be recognized on her deceased spouse’s death certificate was not stayed. - The State of Florida has not yet appealed the ruling. Pending district court cases: Aaron-Brush v. Bentley, N.D. Alabama - Couple seeks recognition of out-of-state marriage. Inniss v. Aderhold, N.D. Georgia - Class action suit challenging the state ban on same-sex marriage and the non-recognition of same-sex marriages performed in other states.

District of Columbia: No Decisions Legal by statute in: District of Columbia Tarcza & Associates, LLC

Louisiana’s Constitutional Provision on Same-sex Marriage Article XII. General Provisions, § 15. Defense of Marriage: Marriage in the state of Louisiana shall consist only of the union of one man and one woman. No official or court of the state of Louisiana shall construe this constitution or any state law to require that marriage or the legal incidents thereof be conferred upon any member of a union other than the union of one man and one woman. A legal status identical or substantially similar to that of marriage for unmarried individuals shall not be valid or recognized. No official or court of the state of Louisiana shall recognize any marriage contracted in any other jurisdiction which is not the union of one man and one woman. Added by Acts 2004, No. 926, §1, approved Sept. 18, 2004, eff. Oct. 19, Tarcza & Associates, LLC

Louisiana Civil Code Article 3520: Marriage A.A marriage that is valid in the state where contracted, or in the state where the parties were first domiciled as husband and wife, shall be treated as a valid marriage unless to do so would violate a strong public policy of the state whose law is applicable to the particular issue under Article B.A purported marriage between persons of the same sex violates a strong public policy of the state of Louisiana and such a marriage contracted in another state shall not be recognized in this state for any purpose, including the assertion of any right or claim as a result of the purported marriage. Acts 1991, No. 923, §1, eff. Jan. 1, 1992; Acts 1999, No. 890, §1.

Fiduciary Duty of Trustees: La. Const. Art. I. Declaration of Rights, § 3. Right to Individual Dignity: Section 3. No person shall be denied the equal protection of the laws. No law shall discriminate against a person because of race or religious ideas, beliefs, or affiliations. No law shall arbitrarily, capriciously, or unreasonably discriminate against a person because of birth, age, sex, culture, physical condition, or political ideas or affiliations. Slavery and involuntary servitude are prohibited, except in the latter case as punishment for crime. “The general rule is that legislation is presumed to be valid and will be sustained if the classification drawn by the statute is rationally related to a legitimate state interest.” City of Cleburne, Tex. v. Cleburne Living Center, 473 U.S. 432, 440 (1985). “Whenever a person disadvantaged by a legislative classification not enumerated in Article I, Section 3 seeks to have the classification declared unconstitutional, that person has the stringent burden of demonstrating that the classification does not suitably further any appropriate governmental interest.” State v. Granger, (La. 5/21/08), 982 So.2d 779, 789. Unless a plaintiff meets the stringent burden of showing that there is no appropriate governmental interest, a statute is presumed to be constitutional. Granger, at 795.

Fiduciary Duty of Trustees: Funds must follow the laws of the state and cannot challenge a state law under the United States Constitution The Louisiana Legislature is the “plan sponsor” of the pension funds. 29 U.S.C. § 1002 (16)(B). As creatures of the Louisiana Legislature, Pension Funds do not have standing to challenge the constitutionality of a statute. “[A] political subdivision, ’created by the state for the better ordering of government, has no privileges or immunities under the federal constitution which it may invoke in opposition to the will of its creator.’” Ysursa v. Pocatello Educ. Ass’n., 555 U.S. 353, 365 (2009), citing Williams v. Mayor of Baltimore, 289 U.S. 36, 40 (1933).

Fiduciary Duty of Trustees: Funds must follow the laws of the state and cannot challenge a state law under the Louisiana Constitution Louisiana Assessors’ Retirement Fund v. City of New Orleans, , (La. 2/7/03), 849 So.2d 1227: “The power of the state and its agencies over municipal corporations within its territory is not restrained by the provisions of the Fourteenth Amendment.” at 1229, citing Warren County, Miss. v. Hester, 219 La. 763, 54 So.2d 12, 18 (La. 1951). “Correspondingly, Article I of the Louisiana Constitution protects only the rights of “persons” and does not protect government entities against unjust government action.” at 1229, citing Morial v. Smith & Wessen Corp., (La. 4/3/01), 785 So.2d 1, 13.