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Posts Tagged ‘healthcare reform’

Both sides can claim victory of a sort, though their wins come at a price.

The Obama Administration and congressional Democrats won on the mandate’s enforceability. But they now own it politically as a tax.

The States won a real choice on Medicaid expansion. But they may not wish to have to make that choice.

The challengers won real limits on federal regulatory power under the Commerce Clause. But they lost on the ultimate judgment of constitutionality.

The real winner of this decision is Chief Justice Roberts. Today’s decision makes clear that this is the Roberts Court, not the Kennedy Court, as many have called it.

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Following the Supreme Court oral arguments in the health care litigation, there has been much more after-argument augmention of merits analyses than severability analyses. That is unfortunate because an incorrect approach to severability poses a more significant problem of long-term distortion of the federal judicial role in constitutional adjudication. This PPACA severability series is an attempt to continue the conversation about severability.

The primary obstacle to clear thinking about severability is a pernicious metaphor that describes invalidation as excision, which is in turn understood as a legislative function. The operation of this metaphor can be seen, for example, in a recent article by Tom Campbell, Dean and Donald P. Kennedy Chair in Law, and Professor of Economics, Chapman University: Severability of Statutes, 62 Hastings L.J. 1495 (2011).

The major premise of Dean Campbell’s article is that “[c]ourts legislate when they engage in ‘severability analysis,’ allowing part of a law to continue in force after having struck down other parts as unconstitutional.” [1495] More precisely,  “making something into law that was not precisely the text that had been approved by Congress and signed by the President is exactly what a court does when it exercises severability authority.” [1498-99]

From this characterization of severance as creating new legislation, the rest of Dean Campbell’s argument follows. Because a presidential “line-item veto” that would accomplish such legislative handiwork without bicameralism and presentment is impermissible, so too is judicial severance that operates just like a line-item veto. Dean Campbell accordingly calls for “the complete abolition of the severability doctrine.” [1497] According to Dean Campbell’s proposed approach, the unconstitutionality of one provision of a bill enacted into law would result in the invalidation of the entire bill of which that unconstitutional provision was a part.

As I have previously argued, the legislative characterization of the severability function is endemic in modern scholarly discourse and unreflectively implicit in existing doctrine. If one accepts Dean Campbell’s premise that severance creates new legislation, then his proposal makes sense as a way of enforcing the bicameralism and presentment requirements for creating new legislation. Dean Campbell’s proposal therefore presents a challenge to all those who accept an excision-based framework for judicial review.

In my view, however, the major premise is incorrect. A judicial refusal to enforce is not equivalent to amending the law or to exercising a judicial line-item veto. “When a court holds part of a statute unconstitutional, it issues a judgment saying so (and, in some cases, an injunction against its future enforcement). By virtue of precedent and preclusion, this judgment and the reasoning in support of it prevent the unconstitutional part of the statute from having legal effect going forward. Nothing about the actual text of the statute changes as a direct consequence of judicial action.” 85 N.Y.U. L. Rev. at 747.

The real challenge for those who advocate inseverability is to justify the transformation of (A) judicial refusal to give effect as law to one provision in resolving a case, into (B) a command that nobody (in the judiciary or otherwise) should give effect as law to any other provisions of the bill that contained the unconstitutional provision. I do not see how that justification of turning (A) into (B) can be done consistently with traditional separation of powers principles.

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Severability doctrine is not only a “discretionary destructive device” that “calls on judges to act, consciously, like legislators,” but it also results in the creation of law without accountability.

Suppose that the Supreme Court holds the so-called individual mandate unconstitutional and fully severable. When insurance companies are stuck with guaranteed-issue and community ratings for sicker people, but without the revenue that comes from insuring healthier people, who is responsible for that? Congress, because it used an unconstitutional mechanism and did not include an inseverability provision? The Court, because it refused to hold the mandate inseverable from these other provisions? There is no good way to answer these questions, because the judiciary’s action is formally based on perceived congressional intent. Both Congress and the Court are responsible, and neither are.

The problem is not simply the existence of a law that Congress never enacted and the President never signed. A holding of unconstitutionality and inseverability that obliterated the PPACA entirely would raise a similar problem of accountability. When small businesses that benefit from tax credits in the PPACA or individuals that benefit from the ban on lifetime caps are deprived of the benefits that they currently enjoy under the PPACA, who do they blame? A case can be made against both Congress and the Court, and each institution also has a plausible defense.

The Supreme Court has often noted the connection between liberty and accountability. An important aspect of liberty is self-government, and self-government requires accountability. That is an important theme of the Court’s federalism jurisprudence. And it also underlies the Court’s recognition that the separation of powers also promotes individual liberty. Consider, for example, Justice Kennedy’s opinion for the Court last term in United States v. Bond, which stated:

Separation-of-powers principles are intended, in part, to protect each branch of government from incursion by the others. Yet the dynamic between and among the branches is not the only object of the Constitution’s concern. The structural principles secured by the separation of powers protect the individual as well.

Within the excision-based framework of modern severability doctrine, there is simply no way for the judiciary to avoid illegitimate law creation or law destruction. And the federal judiciary’s presence in the legislative realm violates the separation of powers. “We Americans have a method for making the laws that are over us. We elect representatives to two Houses of Congress, each of which must enact the new law and present it for the approval of a President, whom we also elect.” Sosa v. Alvarez-Machain (Scalia, J., concurring in part and concurring in the judgment). Once these laws are made, the federal judiciary has a proper role of deciding on their enforceability in cases or controversies. That judicial role is powerful, but limited. The limits come from the federal judicial power itself. For too long, modern severability doctrine  has located within the judicial power an avowedly legislative function. In future posts, I will lay out an alternative approach–the original approach to partial unconstitutionality–more deeply rooted in traditional understandings of the federal judicial role.

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When it comes to severability determinations–especially in the absence of a severability clause–the output of any hypothetical legislative intent test asking what Congress would have preferred is purely fictive. The doctrinal formula that generates it is a verbal shell with its meat scraped out and its insides filled with the fluid of judicial discretion. This failure of existing doctrine to provide an intelligible legal guidance is one reason to stop using it.

An even more fundamental reason for the Supreme Court to keep its hands off this destructive doctrinal tool is rooted in the separation of powers. Simply put, the doctrine calls on judges to act, consciously, like legislators.

The non-judicial nature of an inseverability holding came through clearly at oral argument in the healthcare litigation, although the Justices did not appreciate it at the time. Consider the following portion of the oral arguments, in which Edwin Kneedler of the DOJ presses the claim that the Supreme Court lacks authority to consider the continued enforceability of statutory provisions that the plaintiffs lack standing to challenge:

MR. KNEEDLER: Thank you, Mr. Chief Justice, and may it please the Court: There should be no occasion for the Court in this case to consider issues of severability, because as we argue, the — the minimum coverage provision is fully consistent with Article I of the Constitution. But if the Court were to conclude otherwise, it should reject Petitioners’ sweeping proposition that the entire Act must fall if this one provision is held unconstitutional. As an initial matter, we believe the Court should not even consider that question. The vast majority of the provisions of this Act do not even apply to the Petitioners, but instead apply to millions of citizens and businesses who are not before the Court -­

CHIEF JUSTICE ROBERTS: How does your proposal actually work? Your idea is that, well, they can take care of it themselves later. I mean, do you contemplate them bringing litigation and saying — I guess the insurers would be the most obvious ones -­ without — without the mandate, the whole thing falls apart, and we’re going to bear a greater cost, and so the rest of the law should be struck down. And that’s a whole other line of litigation?

MR. KNEEDLER: Well, I — I think the continuing validity of any particular provision would arise in litigation that would otherwise arise under that provision by parties who are actually -­

CHIEF JUSTICE ROBERTS: But what cause of action is it? I’ve never heard of a severability cause of action.

MR. KNEEDLER: Well, in the first place, I don’t — the point isn’t that there has to be an affirmative cause of action to decide this. You could — for example, to use the Medicare reimbursement  issue is one of the things that this Act does is change Medicare reimbursement rates. Well, the place where someone adjudicates the validity of Medicare reimbursement rates is through the special statutory review procedure for that. And the same thing is true of the Anti-Injunction Act -­

JUSTICE SCALIA: Mr. Kneedler, there are some provisions which nobody would have standing to challenge. If the provision is simply an expenditure of Federal money, it doesn’t hurt anybody except the taxpayer, but the taxpayer doesn’t have standing. That — that just continues. Even though it is — it should — it is so closely allied to what’s been struck down that it ought to go as well. But nonetheless, that has to continue because there’s nobody in the world that can challenge it. Can that possibly be the law?

MR. KNEEDLER: I think that proves our point, Justice Scalia. This Court has repeatedly said that just because there’s — no one may have standing to challenge — and particularly like tax credits or taxes which are challenged only after going through the Anti-Injunction Act, just because no one has standing doesn’t mean that someone must. * * *

JUSTICE SCALIA: But those are provisions that have been legitimately enacted. The whole issue here is whether these related provisions have been legitimately enacted, or whether they are so closely allied to one that has been held to be unconstitutional that they also have not been legitimately enacted. You can’t compare that to — to cases dealing with a statute that nobody denies is constitutional.

MR. KNEEDLER: This case is directly parallel to the Printz case, in our view. In that case, the Court struck down several provisions of the Brady Act, but went on to say it had no business addressing the severability of other provisions that did not apply to the people before [the Court].

The questions posed by Chief Justice Roberts and Justice Scalia here can be distilled to two:

(1) If the Court doesn’t address severability in this case, won’t that leave a mess that the federal judiciary might not be able to be sort out in further litigation?

(2) Should the federal judiciary permit provisions in the statute that nobody can challenge in court to stay in effect as law even though they are “closely allied to one that has been held to be unconstitutional”?

The correct answers to these two questions are Yes and Yes.

Yes, it would create a mess for the Supreme Court to hold the so-called individual mandate unconstitutional without addressing the continued enforceability of other PPACA provisions. But that mess is not the federal judiciary’s problem except to the extent that the enforceability of those other PPACA provisions can be challenged in a case or controversy by someone that they injure in a judicially cognizable way. True, there is no “severability cause of action.” But a regulated entity can, in some circumstances, seek a declaratory judgment and injunction on the ground that a federal statute purportedly applicable to it does not have the force of law. If it were a valid legal argument to say that a statutory provision, itself perfectly constitutional, should not be enforceable because Congress would not have enacted it in the absence of another statutory provision that is unconstitutional, then someone can raise that argument in an appropriate pre-enforcement claim for declaratory and injunctive relief. Under current severability doctrine, that could be a valid legal argument. It ought not to be, because the fact Congress would not have enacted the provision should not be allowed to undo the fact that Congress did pass the provision. But whether this is a valid legal argument and whether it ought to be are two different questions.

Yes, the federal judiciary should leave alone statutory provisions that cause no legally cognizable injury to the parties properly before a federal court in a case or controversy. The doctrines that define the case or controversy requirement set the boundaries of the judicial domain. Anything outside those boundaries is none of the federal courts’ business.

As Justice Scalia recognized in Hamdi v. Rumsfeld, the Supreme Court sometimes adopts a “Mr. Fix-it Mentality” in which the Court “seems to view it as its mission to “Make Everything Come Out Right, rather than merely to decree the consequences, as far as individual rights are concerned, of the other two branches’s actions and omissions.”  The oral arguments over the severability of the so-called individual mandate reveal a Court tempted to play this role.

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The prospect of the Supreme Court deploying severability doctrine in any high-stakes litigation should fill legalists with dread. And the present challenge to the so-called individual mandate in the Patient Protection and Affordable Care Act is high-stakes litigation.

Severability doctrine is a discretionary destructive device. And when judges wield it to lay waste to legislative handiwork, everyone loses. The only winners are the cynics about law whose cynicism is vindicated by the judiciary’s adventuresome expansion of invalidity beyond unconstitutionality.

My first article-length law review piece, Partial Unconstitutionality, was about severability. I wrote it before the PPACA was enacted and without that legislation in mind. In fact, severability doctrine seemed at the time to be in the backwaters of scholarly and judicial interest. That was typical. Nobody pays attention to severability until it matters, and then the doctrine usually evades scrutiny by remaining in the shadows of the substantive constitutional rulings that occasion its application. Sure, there have been bouts of handwringing about severability–as when the Court was busy striking down New Deal legislation in the 1930s, or when INS v. Chadha‘s constitutional holding threatened over 200 statutes that also contained legislative vetoes in the early 1980s. But life would go on and severability would slink back into the shadows.

The recent oral arguments about the severability of the so-called individual mandate have shone a spotlight on severability. And what we have seen isn’t pretty.

The good news is that the Justices recognize an ugly doctrinal state of affairs. The bad news is that there appears little prospect when working within the assumptions of current doctrine to make it better. Barring some serious rethinking of the doctrine, its use in the health care litigation (if it ends up being used) can only make a bad doctrinal situation worse.

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Perhaps the Solicitor General will have more luck with a different aspect of Printz tomorrow?

One of the more pointed lines of questioning directed toward the Solicitor General regarding the constitutionality of Section 5000A came from Justice Scalia with respect to “Proper” in “Necessary and Proper”:

JUSTICE SCALIA: Wait. That’s — it’s both  “Necessary and Proper.” What you just said addresses  what’s necessary. Yes, has to be reasonably adapted. Necessary does not mean essential, just reasonably adapted. But in addition to being necessary, it has to  be proper. And we’ve held in two cases that something that was reasonably adapted was not proper, because it violated the sovereignty of the States, which was implicit in the constitutional structure. The argument here is that this also is — may be necessary, but it’s not proper, because it violates an equally evident principle in the Constitution, which is that the Federal Government is not supposed to be a government that has all powers; that it’s supposed to be a government of limited powers. And that’s what all this questioning has been about. What — what is left? If the government can do this, what — what else can it not do?

GENERAL VERRILLI: This does not violate the norm of proper as this Court articulated it in Printz or in New York because it does not interfere with the States as sovereigns. This is a regulation that — this
is a regulation -­

JUSTICE SCALIA: No, that wasn’t my point. That is not the only constitutional principle that
exists.

GENERAL VERRILLI: But it -­

JUSTICE SCALIA: An equally evident constitutional principle is the principle that the Federal Government is a government of enumerated powers and that the vast majority of powers remain in the
States and do not belong to the Federal Government. Do  you acknowledge that that’s a principle?

GENERAL VERRILLI: Of course we do, Your Honor.

JUSTICE SCALIA: Okay. That’s what we are talking about here.

Justice Scalia’s expansive invocation of quasi-Printz suggests a distinction that he perceives between HHS v. Florida and Gonzales v. Raich.

There is another aspect of Printz that the Solicitor General will rely on tomorrow with respect to severability. That is the Court’s’ refusal to adjudicate the severability of provisions that only burdened parties not before the court. After holding unconstitutional a provision requiring CLEOs (or Chief Law Enforcement Officers) to perform background checks on firearms purchasers, there remained a severability question whether firearms dealers remained obligated to forward to the CLEO the requisite background information and to wait five days before consummating the sale. These steps seemed a pointless formality after the invalidation of the CLEOs’ obligation to do background checks. But the Court’s opinion refused to address the issue:

These are important questions, but we have no business answering them in these cases. These provisions burden only firearms dealers and purchasers, and no plaintiff in either of those categories is before us here. We decline to speculate regarding the rights and obligations of parties not before the Court.

Relying on this aspect of Printz, the federal government has argued that the Supreme Court has no authority to decide the severability of provisions, even the guaranteed issue and community rating requirements, that do not burden the parties to the case.

Printz aside, I think the federal government is right about this as a matter of first principles. Unfortunately, severability has long been an area where first principles have been ignored. Perhaps tomorrow’s arguments will provide a chance for the Court to come face to face with the many problems of its severability doctrine, including the frankly legislative determinations it authorizes the judiciary to undertake.

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I’ve finally been able to review the transcript of today’s oral arguments in the healthcare litigation. The federal government’s position on the Anti-Injunction Act appeared to make it through today’s oral arguments with fewer dings than the positions of the amicus curiae and the challengers. The government’s position appears attractive to the Justices because adopting it would enable them to reach the merits without throwing too big of a wrench into the general machinery of tax enforcement. The broader theories advanced by the challengers would pose such a threat, while adopting the amicus curiae’s position would not allow the Supreme Court to reach the merits at this time. The federal government’s position is legally convoluted, but its narrow scope apparently covers many legal blemishes.

The amount of time spent on the jurisdictionality of the provision surprised me. An effect of the apparent division on the Court with respect to that issue may be to render more attractive the federal government’s position that the Act is inapplicable. As the Solicitor General’s response to questioning by Justice Ginsburg revealed, the Court need not decide whether the Anti-Injunction Act is jurisdictional if the Court concludes that it is simply inapplicable to this challenge to Section 5000A.

In part for reasons explored in this post from last October, I was surprised that Chief Justice Roberts characterized Helvering v. Davis as the “biggest hurdle” facing the amicus curiae’s claim that the AIA is jurisdictional. As Justice Breyer and Justice Scalia pointed out in their questioning, Davis was a suit in which the remedy sought was ordering the corporation not to pay the tax. It was not a suit restraining the assessment or collection of a tax even though the United States intervened as a defendant.

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I had the privilege this morning to participate as a panelist in the Politico Pro Health Care Breakfast Briefing. My fellow panelists were Walter Dellinger, Tom Goldstein, Neal Katyal, and Nina Totenberg. I enjoyed the morning and think we covered a lot of ground.

Nobody (including me) predicted victory for the challengers. Walter Dellinger predicted (and Neal Katyal agreed) that the Court would uphold the mandate’s constitutionality, that it would not be 5-4, and that Chief Justice Roberts would probably write for the Court. Tom Goldstein also predicted victory for the federal government, but thought that we might see a per curiam opinion. Nina Totenberg predicted that Justice Scalia would vote to hold the minimum coverage provision unconstitutional, but declined to speculate about the outcome overall. I declined to speculate about particular Justices, but expressed the view that the Court would vote to uphold the mandate’s constitutionality if it reached the merits of that issue. As many others have observed, the provision’s challengers go in with what looks to be a 4-1 deficit. The likelihood that they will run the table on the remaining four Justices seems low, especially in light of how the litigation played out in the lower courts. That said, “the experts” were wrong about Lopez and Morrison. Time will tell.

The main issue on which I may have viewed things differently from the other panelists was on the Anti-Injunction Act. While I believe it is more likely than not that the Court will reach the merits of the individual mandate, I think that the textual arguments for the Anti-Injunction Act’s applicability are strong and that the possibility of a majority voting to find the AIA applicable is greater than 20%. My recollection is that at least some of the others (particularly Nina Totenberg and Neal Katyal) thought that the Court would be much more likely to favor prompt review out of a belief that the country needs an answer from the Supreme Court now.

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Over at SCOTUSBlog, Lyle Denniston has a superb preview of the Anti-Injunction Act issues at stake in day one of the health care arguments.

I have previously argued that there is a straightforward argument for the Anti-Injunction Act’s application to bar the current challenges, and that Congress’s failure to enact an exception should count against the challengers’ and the government’s policy arguments for prompt review. The basic point is that Congress does not think it important enough to act to ensure prompt review, and the Supreme Court should not bend the Anti-Injunction Act to reach the same result.

I have also previously argued (in a piece that NYU L. Rev. published in 2010 but that I posted to SSRN only recently) that severability doctrine is in disarray and that a modified version of the pre-severability-doctrine understanding of partial unconstitutionality can help get constitutional adjudication back into shape.

There is a connection in the litigation between the judicial role that follows from failure to apply the Anti-Injunction Act and the difficulties that will confront the Supreme Court if it needs to decide the severability of the minimum essential coverage provision.

When it applies, the Anti-Injunction Act channels judicial involvement to a post-enforcement setting. The constitutional question at issue in a post-enforcement setting is whether the statutory provision giving rise to an obligation to pay an exaction–26 U.S.C. 5000A–is constitutional. If an individual succeeds in demonstrating that the provision is unconstitutional, it does not follow that any other provision of the PPACA is no longer enforceable. The Court need not ask, much less answer, the severability question in such a setting.

The pre-enforcement setting is much different, in a way that underwrites an avowedly legislative conception of judicial review. The challengers ask the Supreme Court to excise the minimum essential coverage provision and then decide whether the rest of the PPACA should continue to be enforceable. The pre-enforcement setting obscures the judicial nature of the “judicial review” sought, risking collapse into constitutional review of the statute more generally, rather than a properly judicial act of deciding what law governs in the course of resolving a case or controversy. In fact, the challengers have gone so far as to assert that they are challenging the requirement to have insurance entirely apart from the penalty attendant upon failure to comply with the requirement. That sounds an awful lot like constitutional court abstract review rather than federal court concrete review.

By underwriting a departure from the concrete review of the anticipated application of a particular statutory provision to a particular person, the pre-enforcement setting of HHS v. Florida transforms the expected judicial function into one of a thumbs-up or thumbs-down on the legislation considered in itself. If the Supreme Court can consider the legislation in itself, the limitation of its constitutional ruling to the minimum essential coverage provision itself looks somewhat arbitrary. Might as well contemplate enjoining the application of other provisions like guaranteed issue and community rating, right?

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The papers from the “Everything But the Merits” symposium on the healthcare litigation held at the University of Richmond School of Law last November (11/11/11) will be published in the March 2012 issue of the University of Richmond Law Review. Draft versions of several are now available on SSRN. The paper with the most immediate relevance to the ongoing litigation is Edward Hartnett’s, which addresses the topic of facial and as-applied challenges.

Here are links to the currently available SSRN versions of the papers:

A. Christopher Bryant (Cincinnati), Constitutional Forbearance

Tobias A. Dorsey (Federal Practice), Sense and Severability

Edward A. Hartnett (Seton Hall), Facial and As-Applied Challenges to the Individual Mandate of the Patient Protection and Affordable Care Act

Elizabeth Weeks Leonard (Georgia), The Rhetoric Hits the Road: State Resistance to Affordable Care Act Implementation

Kevin C. Walsh (Richmond), The Anti-Injunction Act, Congressional Inactivity, and Pre-Enforcement Challenges to Section 5000A of the Tax Code

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I recently posted to SSRN a draft version of the paper that arose out of my participation in the “Everything But the Merits” symposium on the healthcare litigation held at the University of Richmond School of Law last November (11/11/11). The papers from the symposium will be published in the March 2012 issue of the University of Richmond Law Review.

The title of my paper is The Anti-Injunction Act, Congressional Inactivity, and Pre-Enforcement Challenges to Section 5000A of the Tax Code.

Abstract below.

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In the previous post, I asked whether a member of an Indian tribe has standing to bring a constitutional challenge to the minimum coverage provision in § 5000A of the tax code (aka the “individual mandate in Obamacare”). A member of an Indian tribe is in an unusual position under § 5000A. She is obligated to have minimum essential coverage, but she is exempt from the penalty for non-compliance. See 26 U.S.C. § 5000A(e)(3). Assuming that the penalty for non-compliance is the only legal consequence for not having minimum essential coverage, I do not see how she would have standing to bring a constitutional challenge to the requirement that she have minimum essential coverage.

If that is right, then what about Mary Brown? She is one of the private plaintiffs in the constitutional challenge to § 5000A to be decided by the Supreme Court. Ms. Brown’s lawyers have notified the Supreme Court that she has filed a petition for bankruptcy. Although there is not enough public information to make a conclusive determination, Ms. Brown’s financial situation probably qualifies her for a penalty exemption in § 5000A(e). If Ms. Brown does fall within one of the penalty exemptions, are there any arguments to support her standing that differ from those available to the member of an Indian tribe?

One that comes to mind is that financial circumstances are subject to change, whereas tribe membership is stable throughout one’s life. If a person’s qualification for exemption varies from month to month, then that person comes in and out of the legal crosshairs of someone with whom one can have a justiciable controversy. This difference is relevant, because someone permanently exempt has no legal adversity with anyone that would give rise to a justiciable controversy. The sometimes-exempt person, by contrast, sometimes does have such legal adversity.

The justiciability problem posed by a sometimes-exempt person is best thought of as a mootness problem rather than a standing problem. The general rule is that standing is assessed as of the time of filing. If the sometimes-exempt person was not exempt as of the time of filing, and the person otherwise had standing, then a change giving rise to that person’s exemption presents a problem of mootness. That doctrine is more flexible than standing. In Friends of Earth, Inc. v. Laidlaw Environmental Services (TOC), Inc., 528 U.S. 167 (2000), for example, Justice Ginsburg’s opinion for the Court expressed openness to an “argument from sunk costs.”

That is as far as I’ve taken the analysis for now. As always, I welcome suggestions, corrections, and other comments.

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If the government imposes a legal duty on you, but provides no sanctions for non-compliance (and there are no collateral legal consequences of any sort for non-compliance), do you have standing to challenge the imposition of the duty? That is one question posed by Section 5000A of the tax code, the provision in the Affordable Care Act more popularly known as the individual mandate.

Section 5000A requires “applicable individuals” to have “minimum essential coverage,” and it imposes a penalty on some “applicable individuals” who do not have “minimum essential coverage.” That is, there are some people who are required to have insurance but who are exempt from the penalty for not having it Members of Indian tribes, among others, are beneficiaries of this exemption.

Suppose a member of an Indian tribe wanted to sue the federal government to have the insurance requirement declared unconstitutional. Would he have standing to do so? I have trouble seeing how he would. It is not enough to be subject to allegedly illegal conduct. That conduct must cause injury. If non-compliance with the insurance requirement has no consequences for a member of an Indian tribe, then it does not cause any injury. Perhaps the would-be plaintiff can argue that he will buy insurance to comply with the requirement if it is constitutional because he wants to be in compliance with the law, but he will not buy the insurance if the requirement is unconstitutional. But that cannot be enough, because the “injury” of being forced to buy insurance is entirely self-inflicted; nobody is forcing the would-be plaintiff to do anything.

A better way of thinking about the “case” or “controversy” problem with a challenge by a member of an Indian tribe to the minimum essential coverage provision is in advisory opinion terms. The request for a constitutional ruling is purely advisory because there is no proper defendant who can be brought before the court and bound by a judgment. Nobody has anything to enforce against the would-be plaintiff, who simply seeks advice about whether the insurance requirement is constitutional.

This analysis would require alteration if there were some collateral legal consequences for non-compliance with the insurance requirement. But if the penalty in § 5000A is the only means by which the insurance requirement has any legal bite, there appears to be no Article III “case” that a member of an Indian tribe can bring offensively to challenge the insurance requirement.

I cannot think of the closest analogue to this situation, and cheerfully invite suggestions, corrections, contrary arguments, and so on.

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Just under a month ago, counsel for Mary Brown told the Supreme Court in a letter that her opening brief would explain why she still had standing to challenge the minimum essential coverage provision even though she had recently filed for bankruptcy (and thus would be exempt from the penalty for non-compliance). The opening brief, filed today, asserts that Mary Brown has standing, but provides no argument in support of the claim. With respect to Mary Brown’s standing, the brief states as follows:

After the parties filed their certiorari petitions, Petitioner Brown, whose standing had been conceded by the Government in the Eleventh Circuit (id. 8a), filed a voluntary petition for bankruptcy. See Letter from G. Katsas to D. McNerney (Dec. 7, 2011). Private Petitioners do not believe that Brown’s pending bankruptcy undermines her standing; to the contrary, her worsened financial state exacerbates the degree to which future costs from the mandate are “immediately and directly affect[ing]” her “financial strength[] and fiscal planning.” Clinton v. City of New York, 524 U.S. 417, 431 (1998).

If this is the promised argument, it is sorely lacking. Do the challengers plan on making an argument elsewhere, or do they have no argument to make? The argument should start with an explanation of what future costs imposed by law directly affect the planning of someone who appears to be exempt at present from any future cost imposed by Section 5000A.

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According to the Supreme Court’s December 8 briefing schedule in the challenges to the Affordable Care Act, the opening briefs are due today with respect to everything but the Medicaid issue. Here are a two related non-merits issues to look at in today’s filings:

  1. How does the NFIB’s brief address the standing of the individual plaintiffs? The Wall Street Journal reported back in December on the bankruptcy filing of Mary Brown, who was the only plaintiff that the government conceded had standing to challenge Section 5000A (the minimum essential coverage provision). Ms. Brown’s personal circumstances may render her eligible for an exemption from the penalty for non-compliance with the minimum essential coverage requirement in § 5000A. Earlier this week, the Wall Street Journal reported that the NFIB’s lawyers sought to add as individual plaintiffs two more NFIB members. This is an unusual move, and one that the challengers would not have taken without good reason. (That is not to go so far as to say that the additions should be viewed as an implicit concession about a lack of standing without the to-be-added plaintiffs, only that the lawyers viewed the downside of not seeking to add plaintiffs as higher than the downside of doing so.) In a letter filed with the Supreme Court disclosing Ms. Brown’s bankruptcy, the private plaintiffs said that they would explain in their opening brief why Ms. Brown still had standing. Today is the day they will make good on that promise.
  2. How does the court-appointed amicus curiae address the Anti-Injunction Act issue? There are several arguments that Mr. Long can make, and it will be interesting to see his assessment of their relative strength by their positioning in the brief.

These two issues may look unrelated on their face, but there is a connection between the AIA issue and Ms. Brown’s standing. One of the arguments that the challengers have previously advanced is that they are challenging the requirement to have insurance but not the penalty for non-compliance. In their view, the mandate is a “free-standing legal requirement” while the penalty is a means of enforcing it. Presumably, this assertion about the internal separability of §5000A with respect to the mandate and the penalty will also be part of the argument for Ms. Brown’s standing. The argument would presumably be that, although Ms. Brown’s financial hardship exempts her from the penalty (under § 5000A(e)), she is still subject to the legal requirement to have minimum essential coverage.

I’m skeptical that these arguments resting on the internal separability of § 5000A succeed. But I will withhold judgment until I see the best presentation of these arguments in the challengers’ briefs.

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Ruth Marcus of the Washington Post argues in an op-ed that a Supreme Court ruling on the constitutionality of the individual mandate should come sooner rather than later. The argument targets some of the prudential reasoning at the end of Judge Kavanaugh’s dissent in Seven-Sky v. Holder while passing over Kavanaugh’s “technical interpretation of the statute.” Marcus argues that “the arguments of Kavanaugh and other advocates of constitutional can-kicking are unconvincing.” Fine. But whatever one’s prudential views about timing, they cannot overcome what a straightforward textual interpretation of the AIA requires. For that reason, advocates of AIA avoidance should aim their arguments at Congress in seeking an exception from the AIA (as I have previously argued).

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David Rivkin & Lee Casey have an op-ed in the Wall Street Journal that contains some misleading argument about the federal tax Anti-Injunction Act (alternate link here). Here are the key paragraphs:

Finally, the Supreme Court has also agreed to consider one of the highly technical arguments raised in the case, whether the federal Anti-Injunction Act (AIA) prohibits a challenge to the individual mandate before the requirement actually takes effect in 2014. This issue has always been a red herring, arising because the government tried to argue that the individual mandate can be justified under Congress’s power to tax, even if it is insupportable under the power to regulate interstate commerce.

Virtually every lower court to consider ObamaCare—both those that have struck down the law as unconstitutional and those that have upheld it—has agreed that the AIA does not apply here. There is every reason to believe that the Supreme Court will do the same. The AIA was designed to protect federal tax-collection activities, generally requiring that a tax be paid before its legality can be challenged in court. The mandate, of course, is not a tax—but an affirmative regulatory requirement. It is enforced by a penalty. The only connection with the federal tax apparatus is that the penalty will be collected by the Internal Revenue Service from tax refunds otherwise due to violators, and its application here would only postpone challenges to the individual mandate to 2014.

A few problems with these two paragraphs:

(1) The federal tax AIA bar does not arise “because the government tried to argue that the individual mandate can be justified under Congress’s power to tax.” In fact, such an assertion is doubly wrong. First, the issue arises because the statutory text of the ACA requires that the tax penalty be assessed and collected in the same manner as other tax penalties that cannot be challenged pre-enforcement because of the federal tax Anti-Injunction Act. Second, Rivkin & Casey’s opposing counsel disclaim a connection between the constitutional justification of the tax penalty as a tax and the operation of the AIA as a bar. Although one would not know it (and would probably think the opposite) from reading the Rivkin & Casey op-ed, the Supreme Court has held that a challenge to a penalty may be barred by the AIA even if the penalty is not “justified under Congress’s power to tax.”

(2) The split on the AIA in the circuit courts of appeals is 2-1, the same as the split on the unconstitutionality of the individual mandate. If these splits were predictive, then Rivkin & Casey should predict that their challenge will lose on the merits.

(3) The connection between the tax penalty for non-compliance with the insurance requirement and the “federal tax apparatus” is not limited to the means of enforcement. The calculation of the penalty (and therefore the assessment of the amount due on one’s tax return) depends on other elements of an applicable individual’s tax return.

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The D.C. Circuit’s opinion upholding the minimum essential coverage provision is available here. Brad Joondeph has a quick summary at ACA Litigation Blog. More to come here on the Anti-Injunction Act, which split the panel. Judge Kavanaugh’s dissent is, in my estimation, persuasive and powerfully reasoned. The nature of the 2-1 circuit split on the applicability of the Anti-Injunction Act suggests that, at the very least, the issue is a difficult and close one.

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Some challengers to the individual mandate now assert that the federal tax Anti-Injunction Act is not jurisdictional. Instead, they claim, it is a defense. From this characterization, they argue that the government has forfeited the AIA as a bar to the challenges.

The non-jurisdictional characterization of the federal tax AIA faces a number of difficulties, including the text of the statute and its authoritative construction by the Supreme Court as a jurisdictional bar (e.g., Enoch v. Williams Packing & Nav. Co., 370 U.S. 1, 5 (1962) (“The object of § 7421 (a) is to withdraw jurisdiction from the state and federal courts to entertain suits seeking injunctions prohibiting the collection of federal taxes.”); Bob Jones Univ. v. Simon, 416 U.S. 725 (1974) (affirming dismissal for lack of jurisdiction)) . Given these difficulties, it is not surprising to see inventive arguments about “jurisdictionality” appear in the recent cert filings.

One argument advanced by the NFIB in its response to the federal government’s cert petition in Florida v. HHS is that the Supreme Court has previously accepted the federal government’s “express ‘waiver of a defense under’ the AIA’s predecessor statute.” (NFIB BIO at 17, quoting Helvering v. Davis, 301 U.S. 619, 639-40 (1937).) The NFIB’s response does not elaborate too much on this argument–as perhaps may be expected given the setting in which the argument appears.

Although understandable, the absence of elaboration is unfortunate because a look at Helvering v. Davis suggests that the quotation lifted out of it by the NFIB has been misdeployed. The AIA provides that “no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court.” The suit in Helvering v. Davis was not such a suit. It was a shareholder suit against a corporation to prevent the corporation from paying a tax. As described by the Supreme Court:

This suit is brought by a shareholder of the Edison Electric Illuminating Company of Boston, a Massachusetts corporation, to restrain the corporation from making the payments and deductions called for by the act, which is stated to be void under the Constitution of the United States. The bill tells us that the corporation has decided to obey the statute, that it has reached this decision in the face of the complainant’s protests, and that it will make the payments and deductions unless restrained by a decree.

As the foregoing description indicates, the suit was not a suit brought against the federal government for the purpose of preventing the government from assessing or collecting a tax. Rather, the suit was brought against a corporation for the purpose of preventing it from paying a tax. Given the nature of the suit, it is far from obvious what relevance the government’s position as an intervenor defendant in the case has to the AIA’s status as a jurisdictional bar in Florida v. HHS. The plaintiffs in that case seek declaratory and injunctive relief against the federal government to prevent it from enforcing an exaction administered through the machinery of tax enforcement.

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As explained in a prior post, the jurisdictional infirmities exposed by the Fourth Circuit’s rulings in Virginia v. Sebelius and Liberty University v. Geithner should bring renewed attention to the alternative state standing theories in Florida v. HHS not yet addressed by any court. There are two such theories.  This post discusses the first, and a later post will examine the second.

The states’ lead theory is one of indirect injury from the incremental Medicaid expenditures each state will have to make when presently uninsured individuals comply with the mandate by enrolling in Medicaid. See States’ 11th Cir. Br. at 67-69.

The federal government has argued that this allegation of indirect injury is insufficient as a matter of law, that the claimed injury rests on speculation, and that any potential injury from individuals’ compliance with the mandate is neither actual nor imminent. Additionally, relying on Pennsylvania v. New Jersey, 426 U.S. 660 (1976), the federal government has argued that “it is difficult to see how a State can claim injury on the ground that its citizens choose to accept benefits the State offers them under State law. Reply to Mot. to Dismiss at 13.

The distinction between direct and indirect injuries in the state standing context is traceable to Florida v. Mellon, in which Florida sought to challenge a federal tax on the ground that it would “have the result of inducing potential taxpayers to withdraw property from the state, thereby diminishing the subjects upon which the state power of taxation may operate.” 273 U.S. 12, 17-18 (1927). The Court held that Florida could not go forward with the suit because the State was not in immediate danger of sustaining “any direct injury as the result of the enforcement of the act in question.” Id. at 18. In short, the Court drew a line between direct and indirect injury, and held that it lacked jurisdiction because the claimed fiscal injury arising by virtue of the actions of private citizens in response to the federal law was indirect.

While the line between indirect and direct may be hard to identify in certain cases, the distinction seems administrable enough to foreclose the claimed injury to states resulting from individuals’ compliance with the individual mandate. Recall, also, that states are not permitted to sue the federal government as parens patriae. Allowing states to rely on indirect fiscal injury could provide for easy circumvention of that limitation.

In attacking the states’ indirect injury argument as speculative, the federal government has argued that (i) the pre-mandate status quo already imposes costs on the states in the form of uncompensated care; and (ii), moving more people into insurance may result in a net reduction of costs borne by the states even though some of that insurance is state-provided insurance through Medicaid. The federal government has also pointed to circuit court cases denying standing to states on the ground that the complained-of fiscal effects were too attenuated. See Pennsylvania v. Kleppe, 533 F.2d 668, 672 (D.C. Cir. 1976); Iowa v. Block, 771 F.2d 347, 352-54 (8th Cir. 1985).

If the Supreme Court were to consider this speculation argument, it is unclear (from the filings I have reviewed, anyway) whether the factual record would be sufficiently developed to ground a prediction about the effects of the mandate on state fiscs (which are likely to vary from state to state). If the record were to be found insufficiently developed, that would cut against the states because it is their burden to establish standing.

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My impression in thinking about and reading about the Fourth Circuit’s decision in Liberty University v. Geithner is that there are not many people out there who are knowledgeable about the federal tax Anti-Injunction Act and the authoritative precedents interpreting it. I say this not as an authority on the statute, as I assuredly am not. I say it as someone who has tried to stay abreast of the jurisdictional issues surrounding the mandate challenges but who still has lots of catch-up work to do on the federal tax AIA. There are not many out there with pre-existing expertise in this area. Most are learning it as they go, and there’s only so much time in the day. Moreover, many discounted the federal tax AIA after a while and focused on other issues. For example, even after the Fourth Circuit ordered supplemental briefing, I thought it was a signal about the panel’s interest in upholding the mandate as a tax rather than an interest in analyzing the jurisdictional bar, so accustomed had I become to the federal government losing on the issue. Perhaps my perspective is peculiar, but I suspect not.

For those not inclined to spend the weekend tracking down cases interpreting the federal tax AIA (but who believe that the law constrains and that it’s not ideology all the way down), here are some reasons to believe that the Fourth Circuit majority might be right about the AIA:

(1) As Ilya Somin has pointed out and Brad Joondeph has emphasized, a critical piece of Judge Motz’s analysis is the conclusion that “tax” has a broader meaning in the AIA than in analyzing the scope of Congress’s Article I powers. Other courts’ analyses have not adequately accounted for this statutory expansiveness.

(2) The federal government’s initial litigating position was less likely than its later position to be refracted through considerations about how certain arguments would be reported by the media and received by the broader public.

(3) None of the appellate courts had the benefit of an adversarial presentation of the issues. But the Fourth Circuit had the benefit of all the other prior AIA analyses and took the time to address the perceived shortcomings of each.

(4) The Fourth Circuit was able to consider the amicus brief filed (in the D.C. Circuit) on behalf of two former IRS commissioners, which provides a tax-law perspective on the AIA. (UPDATE: For the Fourth Circuit supplemental briefs on the AIA, which all conclude that the AIA does not bar a challenge to the mandate, see here and here (federal government briefs), here (Liberty University’s brief), here (Virginia’s brief), and here (Pacific Legal Foundation/Steven Willis). There are some differences in the way that that the briefs reason toward their conclusion about the AIA, so all are worth examining in forming one’s perspective on the federal taxa AIA arguments. Thanks to Timothy Sandefur for the pointer to the PLF letter brief and to the ACA Litigation Blog for hosting the briefs.)

(5) Judge Motz’s thorough analysis provides plausible legal responses to some of the more policy-influenced arguments put forth by the federal government, the plaintiffs, and the dissent.

(6) The mandate challenges are the kind of case in which “technicalities” like the AIA can be given by short shrift, when the parties on both sides want a merits resolution and judges want to contribute their analysis of the merits (as evidenced by the proliferation of opinions at the appellate level).

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Regardless of what one thinks about the constitutionality of the individual mandate in the Affordable Care Act, there appears to be an emerging bipartisan consensus that (1) its constitutionality should be resolved by the Supreme Court, and (2) the Supreme Court should act sooner rather than later (i.e., by the end of the October 2011 Term rather than in some later term). For example, the news coverage here in Virginia after yesterday’s rulings dismissing Virginia’s challenge and dismissing Liberty University’s challenge included statements urging Supreme Court review by both Republican Governor Bob McDonnell and Democrat Senator Mark Warner (relevant statements quoted below if you don’t want to click through).

In light of yesterday’s rulings, however, there is a real possibility that the Supreme Court could conclude that it lacks jurisdiction to rule on any of the challenges to the individual mandate. Challenges by the states have been dogged by questions about jurisdiction from the outset. The Fourth Circuit’s answer to some of those questions knocked out Virginia’s case. The 26-state mandate challenge in Florida v. HHS has so far dodged jurisdictional bullets because of the presence in that case of private parties, whose standing to challenge the mandate has generally been accepted by the federal courts. But yesterday’s Fourth Circuit ruling in Liberty University v. Geithner has breathed new life into a private-plaintiff jurisdictional problem that the parties to the mandate challenges had left for dead. Specifically, the Fourth Circuit held that the Tax Anti-Injunction Act prohibited individuals subject to the mandate from bringing a pre-enforcement challenge because such a suit was one to restrain the assessment or collection of a tax.

If there is a jurisdictional problem preventing both the private plaintiffs (who are subject to the individual mandate) and the State plaintiffs (who are not subject to the individual mandate) from having a federal court hear their constitutional challenges, then the Supreme Court cannot get to the merits of the mandate challenges any time soon.

One response may be to hope that the Supreme Court reads the Tax Anti-Injunction Act differently from the Fourth Circuit. That response may rest on wishful thinking. I need to study the relevant precedents more closely than I have previously, but Judge Motz’s opinion strikes me as persuasive. (See also the amicus brief filed by two former Commissioners of the IRS, Mortimer Caplin and Sheldon Cohen.)

In any event, there is no need to take a chance and rest the possibility of a mandate-challenge merits decision on speculation about how the Supreme Court will resolve the legal uncertainty about application of the Tax Anti-Injunction Act. The Act sets forth a statutory limitation that Congress can and should change to allow a pre-enforcement challenge to the individual mandate. Importantly, it appears that Congress can make this change effective immediately and can make clear that the change preserves jurisdiction over private-party challenges to the individual mandate that have already been filed. See Hamdan v. Rumsfeld, 548 U.S. 557, 576 (2006) (“We have in the past ‘applied intervening statutes conferring or ousting jurisdiction, whether or not jurisdiction lay when the underlying conduct occurred or when the suit was filed.’”), quoting Landgraf v. USI Film Products, 511 U.S. 244, 274 (1994); see also Landgraf v. USI Film Products, 511 U.S. 244, 274 (1994) (“[I]n Andrus v. Charlestone Stone Products Co.436 U.S. 604, 607-608, n. 6 (1978), we held that, because a statute passed while the case was pending on appeal had eliminated the amount in controversy requirement for federal question cases, the fact that respondent had failed to allege $10,000 in controversy at the commencement of the action was ‘now of no moment.’”). (My assessment of the legal soundness of a “retroactive” jurisdictional cure is based on just a little bit of digging around thus far, and I have not yet vetted the assessment with others, but the foregoing authorities appear to support it. Critical commentary is, of course, welcome on this or any other aspect of the post.)

In sum: The constitutional merits of the challenges to the individual mandate have divided largely (though not cleanly) along party lines, but there appears to be bipartisan agreement that the merits should be decided soon. A legislative fix to the Tax Anti-Injunction Act can eliminate a jurisdictional barrier that presents a serious possibility of causing extensive delay. Congress can and should get rid of that barrier and clear the way to prompt Supreme Court resolution of the constitutional challenges to the individual mandate.

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Statement by Gov. McDonnell (R-VA) on the need for prompt Supreme Court review of the constitutionality of the individual mandate:

“As federal courts across the country continue to come to differing conclusions on the merits of cases arguing the unconstitutionality of the federal health care law, today’s decision further exemplifies why these cases should be expedited to the nation’s highest court.  It is the Supreme Court that will ultimately determine whether the federal mandate on every citizen to purchase health insurance violates the U.S. Constitution.  States and businesses continue to expend time and money and languish in uncertainty as they try to come into compliance with a law that may ultimately be ruled unconstitutional. It is exasperating that the President and the Justice Department oppose a prompt resolution of this case through an expedited appeal.  America needs finality in this case.”

Statement by Sen. Mark Warner (D-VA) on the desirability of prompt Supreme Court review of the constitutionality of the individual mandate:

“This is going to end up getting decided by the Supreme Court and candidly, I hope, the sooner the better. I do believe there are a lot of parts of the health care reform law that make sense. I think there are some parts that need to be corrected.”

[Note: The Warner quotation comes directly from the linked video. The accompanying text misquotes Sen. Warner.]

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If the Fourth Circuit’s interpretation of the Anti-Injunction Act were to be adopted by the Supreme Court, that would knock out all the private party challenges to the individual mandate. That would return attention to the question of whether the states’ challenge to the individual mandate is justiciable.

The Virginia approach of relying on a conflicting state statute has all sorts of problems, including those identified by the Fourth Circuit in Virginia v. Sebelius.

The states in Florida v. HHS have developed additional theories of standing that do not require conflicting state statutes. They have done so because necessity is the mother of invention; the necessity arises from the simple fact that most of the state plaintiffs seeking to challenge the individual mandate do not have an anti-mandate state law like Virginia’s Health Care Freedom Act.

I have argued in an amicus curiae brief in the Eleventh Circuit and in The Ghost that Slayed the Mandate that Florida’s alternative theories do not succeed in establishing the justiciability of the states’ challenge to the individual mandate. The Eleventh Circuit said it did not need to address state standing. The issue was “purely academic,” said they, because at least one private plaintiff had standing and one is enough. I criticized that reasoning in an earlier post that focused on the relationship between inseverability and standing.

I can now add another criticism: It may very well be that there is no subject-matter jurisdiction over the private plaintiffs’ challenges because of the Anti-Injunction Act. If the AIA blocks the private plaintiff challenges, then the only way to reach the merits is by adjudicating the states’ challenge to the individual mandate. The states can likely get around the AIA with South Carolina v. Regan, 465 U.S. 367 (1984). Consequently, the jurisdictional action going forward should focus not only on the AIA but also on the states’ theories for why they can challenge a statutory provision that imposes no obligation on them.

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Now that the Fourth Circuit panel that heard oral argument in Virginia v. Sebelius and Liberty University v. Geithner has disposed of the other two appeals heard that same morning, one can use the panel’s actions in those cases to speculate about the authorship of the opinions in the two challenges to the individual mandate. My best guess is that Judge Motz was assigned to author the principal opinion in Liberty University v. Geithner and that Judge Davis was assigned to author the principal opinion in Virginia v. Sebelius. This is all speculative, of course, but there is a long and glorious tradition of speculating about opinion authorship in appellate cases.

(more…)

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Jonathan Adler and Ilya Somin argue that Judge Sutton’s opinion upholding the individual mandate against a facial challenge is inconsistent with the Supreme Court’s decisions in United States v. Lopez and United States v. Morrison. More particularly, Adler and Somin view Lopez and Morrison as establishing some type of overbreadth doctrine for Commerce Clause challenges. They reason that the provisions held unconstitutional in both cases included within their reach activities that Congress could have permissibly regulated if it had legislated more narrowly. Yet Congress did not legislate more narrowly, and the Court held the entire challenged provisions unconstitutional. From these results, Adler and Somin conclude that constitutionality under the Commerce Clause is all or nothing, on a provision-by-provision basis.

Here is Somin:

Sutton’s analysis rests on a misinterpretation of the plaintiffs’ argument. The key point is not that a given plaintiff hasn’t engaged in economic activity, but that the regulation imposed by Congress does not require any such activity as a prerequisite for covering them. The fact that some of the individuals covered by the mandate could be regulated by a more narrowly drawn law (e.g. — one that covered only people who had already purchased health insurance) does not mean that the present mandate is constitutional as applied to them. Their having previously engaged in economic activity that Congress could regulate is purely coincidental. It is not the reason why the mandate applies to them, under the terms of the law itself.

And Adler:

The traditional test for a facial challenge is whether there is any set of circumstances in which the statute’s application would be constitutional.  As Lopez shows, the proper way to apply this test is not to ask whether the statute reaches otherwise reachable conduct — commercial gun possession, the purchase of insurance, etc.  Rather, the question is whether the class of activities expressly subject to regulation — that is, the conduct which brings an individual within the scope of the statute at issue — is itself within the scope of the Commerce power.  As the Supreme Court has reiterated time and again (albeit mostly in cases upholding statutes against Commerce Clause challenge), what matters is what Congress did, not the specific conduct of the individual challenging the statute’s constitutionality.  This is why Lopez prevailed.

These criticisms neglect the “essential part of a larger regulatory scheme” prong of Commerce Clause analysis. That prong provides that Congress can regulate some activity not otherwise within its reach if that regulation is “an essential part of a larger regulation of economic activity, in which the regulatory scheme could be undercut unless the intrastate activity were regulated” (Lopez). To demonstrate the unconstitutionality of a provision, then, it is not enough to say that it is overbroad, that is, that the provision encompasses conduct not otherwise within the reach of Congress.

After Gonzales v. Raich, one of the confusing features of Lopez is that the provision at issue there seemingly could have been constitutional not only if it were drawn more narrowly, but also if it were drawn more broadly (as Justice O’Connor argued in dissent). As Adler argues in the piece linked to his post, “[a] broad regulatory scheme that regulates economic matters in some regard will be constitutional in its entirety” (p. 764). Similarly, Somin observes in the piece available for download here, that Raich makes it “possible for Congress to shoehorn virtually any regulation of local noneconomic activity by designating it a component of a broad regulatory framework” (pp. 516-17).

Suppose Congress had included the ban on gun possession in school zones within a larger regulatory scheme, and Lopez made the identical argument for unconstitutionality.  That argument could be characterized as an as-applied challenge seeking a carve-out–precisely the sort of argument that Raich foreclosed with respect to the CSA.

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