Opinion ID: 2576193
Heading Depth: 4
Heading Rank: 2

Heading: Legitimate Business Interests

Text: As a further ground for holding that the Unruh Act did not ban marital status discrimination, Beaty invoked the second prong of the Harris analysis and found that the insurer's denial to the plaintiffs of the umbrella coverage it issued to married couples was justified by legitimate business interests. (See Harris, supra, 52 Cal.3d at pp. 1162-1165, 278 Cal.Rptr. 614, 805 P.2d 873.) Likewise, BHCC, relying on Beaty, also argues that its restriction of the spousal benefit to married couples serves legitimate business interests. In its discussion of the second prong of Harris, Beaty found that the legal unity of interest and the shared responsibilities attendant upon a marriage both minimized the economic risk to the insurer in providing such coverage to married couples and provide[d] a fair and reasonable means of determining eligibility for services or benefits. ( Beaty, supra, 6 Cal.App.4th at p. 1464, 8 Cal.Rptr.2d 593.) By contrast, an insurer could reasonably conclude that the relationship of an unmarried couple lacks the assurance of permanence necessary to assess with confidence the risks insured against in a joint umbrella policy. ( Ibid. ) As discussed, these same concerns have been echoed in other decisions rejecting claims by unmarried couples to such benefits and services. (E.g., Elden v. Sheldon, supra, 46 Cal.3d at pp. 275-276, 250 Cal.Rptr. 254, 758 P.2d 582; Norman v. Unemployment Ins. Appeals Bd., supra, 34 Cal.3d at p. 9, 192 Cal.Rptr. 134, 663 P.2d 904; Harrod v. Pacific Southwest Airlines, supra, 118 Cal.App.3d at p. 158, 173 Cal.Rptr. 68.) These concerns, however, do not apply to registered domestic partners. Registered domestic partners occupy a legal status that, like marital status, is formalized, public and verifiable. (§§ 297, 298, 298.5, 299.) The Declaration of Domestic Partnership that registered domestic partners are required to file with the Secretary of State (§ 297, subd. (b)) provides an easily verifiable method of determining whether a couple is in a registered domestic partnership. Therefore, a business is no longer required to undertake a `massive intrusion' [citation] into [the couples'] private lives [and] inquire into their sexual fidelity and emotional and economic ties ( Beaty, supra, 6 Cal.App.4th at p. 1465, 8 Cal.Rptr.2d 593) to determine whether these unions possess a sufficient assurance of permanence and legal unity of interests to extend benefits formerly reserved for spouses. Moreover, because the substantive rights and responsibilities granted to and imposed upon domestic partners are the same as those granted to and imposed upon spouses (§ 297.5), a business extending such benefits would have the same assurance against loss or fraud that it would have in the case of spouses. In light of this analysis, we find unpersuasive the various business interests BHCC claims are served by its policy of denying family membership benefits to any but married couples. BHCC claims that extending that benefit to members' friends might lead to overuse of its facilities, create a disincentive for such friends to apply for membership and would discourage its legitimate goal of creating a family-friendly environment by welcoming the immediate family of married members. French, however, is not simply Koebke's friend, but her registered domestic partner, with rights and responsibilities similar to that of a spouse. Extending the spousal benefit to her would not create the stampede on the fairway that BHCC appears to envision. BHCC also argues that denying French the spousal benefit contributes to the creation of a family-friendly environment. While creating a family-friendly environment may be a legitimate business interest, that policy is not served when a business discriminates against the domestic partner of one of its members. Rather, by so doing, the business violates the policy favoring domestic partnerships which, like the policy favoring marriage, seeks to promote and protect families as well as reduce discrimination based on gender and sexual orientation. Accordingly, we conclude that, while promoting a family-friendly environment may be a legitimate business interest, that interest is not furthered by excluding families formed through domestic partnership.