## Facts

- Arizona’s state employee health plan initially allowed coverage only for spouses and certain children.
- In 2008, Arizona expanded eligibility by regulation to include “qualified domestic partners” of either sex, allowing same-sex employees to cover their partners.
- In 2009, Arizona enacted Ariz. Rev. Stat. § 38-651(O) (Section O), redefining “dependent” to spouses and certain children, effectively eliminating domestic-partner coverage once existing contracts expired.
- Because same-sex couples could not marry (and Arizona did not recognize same-sex marriages), same-sex employees had no route to restore partner coverage, while opposite-sex couples could marry to qualify.
- Same-sex state employees sued, alleging Section O violated the Equal Protection Clause, and sought a preliminary injunction to prevent termination of partner coverage.
- The district court granted a preliminary injunction, finding likely success on the merits and irreparable harm from loss of health coverage and disruption of medical care.
- The State appealed the preliminary injunction.

## Issues

1. Whether the district court abused its discretion in granting a preliminary injunction based on a finding that plaintiffs were likely to succeed on their Equal Protection Clause challenge to Section O’s practical operation.
2. Whether the threatened loss of partner health coverage and related medical disruption constituted irreparable harm supporting preliminary injunctive relief.

## Decision

- The Ninth Circuit affirmed the preliminary injunction.
- The court held plaintiffs showed a likelihood of success on their equal protection claim because Section O, as applied in combination with Arizona’s marriage restrictions, imposed a disparate burden on gay and lesbian employees without a rational connection to legitimate state interests.
- The court agreed plaintiffs established likely irreparable harm from loss of coverage and potential interruption of medical treatment.
- The balance of equities and the public interest favored maintaining coverage while the merits were litigated.

## Legal Principles

- A preliminary injunction may issue when plaintiffs show likelihood of success on the merits, likelihood of irreparable harm, balance of equities in their favor, and consistency with the public interest.
- Under rational-basis equal protection review, a classification (including one created by a law’s practical effect) must bear a rational relationship to a legitimate governmental purpose.
- A state may not pursue budgetary savings by imposing financial burdens on an unpopular group where the asserted fiscal rationale is arbitrary or disconnected from the classification.
- Administrative convenience does not supply a rational basis when the government has already administered the broader benefit and the asserted simplification does not explain the disparate impact created by coupling benefit eligibility to a status that one group is legally barred from obtaining.
- “Encouraging marriage” is not a rational justification for conditioning benefits on marriage when the affected class is legally unable to marry, leaving no comparable path to eligibility.

## Conclusion

The Ninth Circuit upheld an order blocking enforcement of Arizona’s dependent-definition change because, in context, it selectively withdrew previously available partner health benefits in a manner that disproportionately harmed same-sex couples and was not rationally related to the State’s asserted interests, while the threatened loss of coverage supported injunctive relief.


Diaz v. Brewer, 656 F.3d 1008 (9th Cir. 2011)