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For a comparison case that more closely tracks the analysis I suggested would have been proper in my prior post on Judge Sutton’s opinion for the Sixth Circuit in Platinum Sports Ltd v. Snyder, see Judge Kanne’s opinion for the Seventh Circuit in Wisconsin Right to Life, Inc. v. Schober. The key reasoning is contained in the following four paragraphs:

Right to Life submits that the threat of enforcement inherent in the statute chilled its participation in the July 2003 special election and will continue to chill its speech unless the federal courts provide injunctive relief. “A plaintiff who mounts a pre-enforcement challenge to a statute that he claims violates his freedom of speech need not show that the authorities have threatened to prosecute him; the threat is latent in the existence of the statute.” Majors v. Abell, 317 F.3d 719, 721 (7th Cir. 2003) (internal citations omitted); see Virginia v. Am. Booksellers Ass’n Inc., 484 U.S. 383, 393 (1988). The instant case, however, presents a unique circumstance because the statute at issue has been declared unconstitutional by a district court and that ruling was not appealed.

Although it is highly unusual to seek injunctive relief when a judgment that was not appealed has already rendered a challenged statute unconstitutional, Right to Life’s argument in favor of Article III standing is not “frivolous,” as the Board contends. Right to Life presents a two-step argument. First, Right to Life points out that the injunction entered against the Board to prevent enforcement of the statute against theWisconsin Realtors Ass’n plaintiffs did not extend to Right to Life. Indeed, district courts lack the authority to enjoin the “enforcement of contested statutes or ordinances except with respect to the particular federal plaintiffs.” McKenzie v. City of Chicago, 118 F.3d 552, 555 (7th Cir. 1997) (quoting Doran v. Salem Inn, Inc., 422 U.S. 922, 931 (1975)); see also Fed. R. Civ. P. 65(d) (“Every order granting an injunction . . . is binding only upon the parties to the action . . . .”). Right to Life is correct in asserting that the injunction against enforcement granted in the Wisconsin Realtors Ass’n case does not protect it, a non-party to the Wisconsin Realtors Ass’ncase.

The second step of Right to Life’s argument is that the declaratory judgment granted in the Wisconsin Realtors Ass’n case does not limit the power of the Board to bring prosecutions under the statute. Certainly, the statute cannot be repealed by a district-court opinion; only the Wisconsin legislature can repeal the statute. Furthermore, a district court’s declaration that the statute is unconstitutional does not automatically stop state officials from trying to enforce the statute. Coupled with the Board’s refusal to issue an advisory opinion, Right to Life reasons that this is enough to present a live controversy to the federal courts.

Right to Life’s argument, however, fails to tie this theoretical harm to an actual and imminent threat of enforcement. The Board did not appeal the Wisconsin Realtors Ass’n case. Implicitly, the Board has conceded that the statute is unconstitutional. The State’s Attorney General conceded before the Wisconsin Realtors Ass’n litigation that the statute was unconstitutional in its petition to the Wisconsin Supreme Court to determine the constitutionality of Act 109. Right to Life makes no effort to satisfy its burden of persuasion by showing that any Wisconsin official, let alone the Board, has ever tried to enforce a statute in these circumstances.

The only seemingly relevant difference between this case and Platinum Sports is that the plaintiffs in the later cases in Platinum Sports were represented by the same lawyer. But this difference makes no difference. For a while, some circuit courts had applied a “virtual representation” doctrine under which representation by the same lawyer might have made a difference in the preclusion analysis. But the Supreme Court rejected the doctrine of virtual representation in Taylor v. Sturgell, 553 U.S. 880 (2008).

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Thanks to a recent post by Jonathan Adler at Volokh Conspiracy, I read with great interest last week Judge Sutton’s opinion for the Sixth Circuit in Platinum Sports Ltd. v. Snyder. The underlying claim was a First Amendment challenge to a Michigan ordinance restricting signs for sexually oriented businesses, but the opinion affirms dismissal on the non-merits ground of lack of standing. The decision addresses difficult issues surrounding “facial challenge” doctrine and standing to challenge a law that the relevant enforcement officials agree is unconstitutional and have agreed not to enforce. If this were a casenote outline, I would probably classify this decision as “right outcome; wrong reasoning.” But I’m not sure and it raises important questions worth considering, so here’s an analysis.

The basic situation consists of three cases: (1) Attorney A, representing Client X, files a complaint seeking declaratory and injunctive relief against Governor, alleging that a state law is unconstitutional–on its face and as applied–under the First Amendment; (2)  Attorney A, representing Client Y, files a second complaint seeking declaratory and injunctive relief against Governor and Attorney General, making the same constitutional challenge; and (3) Attorney A, now representing Client Z and seeking to represent a class of approximately 400 similarly situated businesses covered by the claim, files a complaint seeking declaratory and injunctive relief against Governor and Attorney General, making the same constitutional challenge as in the first two cases.

The timeline of relevant events in these cases is as follows:

  • April 25, 2011: Complaint in case (1) is filed.
  • July 14, 2011: Hearing in case (1) on motion for preliminary injunction and motion to dismiss.
  • July 20, 2011: Complaint in case (2) is filed.
  • July 26, 2011: District court is case (1) grants preliminary injunction and denies motion to dismiss.
  • August 25, 2011, Case (1) and case (2) are terminated by a final judgment in Plaintiffs’ favor, together with injunctions against enforcement of the statute.
  • October 21, 2011: Complaint in case (3) is filed.

The Sixth Circuit held in Platinum Sports, Inc. v. Snyder that the plaintiff business in case (3) lacked standing because it suffered no cognizable injury. I think that bottom-line conclusion is correct, but for a different reason than provided in Judge Sutton’s opinion for the court.

Let’s begin with common ground. The mere “on-the-books existence” of a statute is not enough to create legally cognizable injury. The statute must have some kind of injurious effect that a federal court is capable of redressing. Federal courts do not take statutes off the books. They enter judgments and remedies that prevent enforcement of laws. Judge Sutton’s statement of these relevant principles seems just right: “[T]he question is whether the claimant has an ‘actual and well-founded fear that the law will be enforced against them.’ Virginia v. Am. Booksellers Ass’n, Inc., 484 U.S. 383, 393 (1988). Absent some ‘credible threat’ of enforcement, no injury exists. Babbitt v. United Farm Workers Nat’l Union, 442 U.S. 289, 298 (1979).”

The Platinum Sports opinion reasons that there was no credible threat of enforcement against the plaintiff in case (3) at the time the complaint was filed because the statute had already been declared facially unconstitutional and its enforcement had been enjoined in an order agreed to by the Governor and the Attorney General. The assessment that there was no credible threat of enforcement is probably right, but not for the reason given in the opinion.

The opinion’s analysis turns on an explication of facial challenge doctrine:

A party who brings a facial challenge to a law “seeks to vindicate not only his own rights, but those of others who may also be adversely impacted by the statute in question.” City of Chicago v. Morales, 527 U.S. 41, 55 n.22 (1999). A successful facial challenge invalidates a law in all of its applications, “forbidd[ing]” any enforcement of it. Broadrick v. Oklahoma, 413 U.S. 601, 613 (1973). The upshot is that a State may not enforce such a law against anyone.

But what constitutes a “successful facial challenge”?

Consider the order in case (2) (which is the same in all material respects as the order in case (1)): “IT IS HEREBY ORDERED that judgment declaring that M.C.L. 252.318a violates U.S. Const., Amend. I (the First Amendment to the United States Constitution) is entered for Plaintiff and Defendants are permanently ENJOINED from enforcing M.C.L. 252.318a.”

Suppose that the defendants believe that the district court’s understanding of the First Amendment in cases (1) and (2) is wrong. Do the judgments and injunctions in those cases protect all other SOBs in the state against enforcement of the law?

The Sixth Circuit found the answer to this question in facial challenge doctrine, stating: “[T]he district court’s orders [in cases (1) and (2)] declared the laws facially unconstitutional, necessarily prohibiting their enforcement against anyone, including the plaintiff [in case 3].” Judge Sutton’s opinion for the court appears to assume that the injunctions in these cases authoritatively prohibit enforcement against anybody else, but the reason for this assumption is unclear:

In this instance, the district court entered a stipulated final judgment declaring the two laws facially unconstitutional and enjoining the Governor and Attorney General from enforcing either law. Nor is there any reason to fear the Governor or Attorney General will sidestep these orders. They agreed to their entry. If any doubt remained about the point, the Governor and Attorney General eliminated it in this case. In their appellate brief, they have recognized the “provisions to be unconstitutional,” Br. at 22, and have promised that they “will not be enforced,” id. at 16. Anything in this world is possible, we suppose. But the legal possibility that this Governor or this Attorney General will enforce these laws in the face of these injunctions is: zero.

While the opinion states that the “legal possibility” of enforcement is “zero,” that is distinct from a claim about “legal permissibility.” The opinion appears to assume that facial challenge doctrine can somehow expand the binding legal effect of a judgment or remedy. But  facial challenge doctrine cannot expand the binding legal effect of a judgment or remedy because the theory of constitutional infirmity underlying a particular judgment does not itself bind except through embodiment in a remedy or through preclusion or precedent.  In order to know the binding legal effect of the district court’s ruling in cases (1) and (2), it is therefore necessary to know the preclusive effect of the underlying judgment and the terms and permissible reach of the injunction issued. The declaration of facial unconstitutionality can only reach as far as these other doctrines permit it to reach. (Another means by which judicial declarations of law can bind in courts is through stare decisis, but that doctrine has no application here because a district court ruling has no precedential effect for other cases.)

To see why this distinction is important, suppose that the AG (enjoined in cases (1) and (2) beginning in August 2011) had sent a letter in September 2011 threatening enforcement of the ordinance against Z (the plaintiff in case (3)). Would Z have had standing to file a federal lawsuit seeking declaratory and injunctive relief on October 21, 2011? Yes, Z would have had standing. The injunctions in cases (1) and (2) protect X and Y (the plaintiffs in those cases), but these injunctions do not themselves eliminate the threat of enforcement against Z. See Doran v. Salem Inn, Inc., 422 U.S. 922, 931 (1975) (“[N]either declaratory nor injunctive relief can directly interfere with enforcement of contested statutes or ordinances except with respect to the particular federal plaintiffs, and the State is free to prosecute others who may violate the statute.”). (It may also be worth adding that, not only would Z have had standing, but that if Z had wanted a federal forum for its lawsuit, Z should have filed suit quickly after receiving the threat letter because the initiation of an enforcement action in state court can result in Younger abstention.)

There was no threat letter here, so why does any of this make a difference? The comparison reveals that the real legal basis for the absence of any threat of enforcement is not the “successful facial challenge” in case (1) or (2), but the defendants’ agreement that the statute is unconstitutional and their promise (rather than their legal obligation) not to enforce the statute. The fact that they made this agreement in connection with a stipulated judgment and an order to pay over $20,000 in attorneys’ fees makes their commitment to non-enforcement credible.

This discussion of the reasoning underlying the no-standing dismissal in Platinum Sports is not just idle nitpicking about a minor issue. The effectiveness of agreement about unconstitutionality to preclude standing by eliminating threatened enforcement goes to the very fundamentals of pre-enforcement adjudication of constitutional challenges to constitutionally questionable laws. Consider, for example, a pre-enforcement challenge to a State’s partial-birth abortion prohibition in which the sole theory of constitutional infirmity is that the statute is unconstitutional as applied to performance of the constitutionally protected D&E procedure. (Such a limited claim would be unusual but not completely implausible given the Supreme Court’s statement of a preference for as-applied challenges in this area.) Suppose the Attorney General’s position is that the statute does not criminalize the D&E procedure, but even if it did, the State would never use the statute to prosecute for the performance of a D&E because the Attorney General agrees that the statute would be unconstitutional as applied to D&Es. Suppose that no prosecutor can initiate a prosecution without the AG’s approval. If an agreement not to enforce precludes standing, then there would be no standing to bring this challenge. Or would there be?

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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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According to Wikipedia, the Roach Motel is a type of trap for cockroaches that lures them into a sticky substance in which they become immobilized. According to Randy Barnett, Judge Sutton’s view of facial challenges in Thomas More Law Center v. Obama commits Judge Sutton to viewing individuals who possess health insurance as roaches in the sticky sweet trap of federal power–“[h]aving once voluntarily chosen to get insurance, they can be mandated never to stop.”

Suppose one agrees with Professor Barnett that citizens are not to be treated like cockroaches. What does that imply for the validity of the requirement in federal law that individuals obtain or maintain a minimum level of health insurance? Nothing, one would think. And so it is. Whether an individual has previously purchased health insurance would seem to be irrelevant to whether the federal government can require that individual to be insured. Judge Sutton does not necessarily disagree with this proposition. Indeed, it is the activity/inactivity distinction–which Judge Sutton rejects–that makes one’s prior purchase of health insurance relevant to the constitutional analysis.

Judge Sutton undermines the activity/inactivity distinction by arguing that it is within Congress’s power to regulate those who possess health insurance that they previously purchased. At most, then, the plaintiffs’ theory of invalidity shows that the mandate is overbroad. Yet Judge Sutton concludes that the form of alleged overbreadth–a flawed generalization that groups together all of the uninsured–is not of the sort that violates the Commerce Clause. He then invokes, as a fallback argument, the idea that facial invalidation would be inappropriate “even if the Constitution prohibit Congress from regulating all of the self-insured together.” Again, this is a fallback argument. The principal argument is that Congress may permissibly regulate all of the self-insured together.

Because the turn to facial challenge doctrine is a fallback argument, it is descriptively inaccurate for Barnett to assert that Sutton’s view of facial challenges “allowed him to avoid the hardest issues posed by the mandate: compelling citizens into a market – here the insurance market – who are not currently in that market.” Judge Sutton faced that issue, and resolved it against the challengers.

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In a prior post, I argued that Judge Sutton’s analysis in Thomas More Law Center v. Obama reveals how the challengers to the individual mandate rely on a theory of invalidity that has a flaw similar in structure to the challenge rejected by the Supreme Court in Gonzales v. Raich. If accepted, the challengers’ Congress-can’t-force-you-into-commerce theory would demonstrate that the requirement to possess insurance or pay a penalty is beyond Congress’s power only with respect to some individuals who do not already possess the requisite kind of insurance. The challenged statutory provision, however, applies both to those who already possess the requisite kind of insurance and also to those who do not. The Congress-can’t-force-you-into-commerce theory of invalidity can therefore be understood as a carve-out theory of invalidity.

Randy Barnett argues that Judge Sutton’s use of facial challenge doctrine to reject the plaintiffs’ challenge depends on logic that would eliminate any “justiciable way to adjudicate whether Congress has exceeded its Commerce Clause powers.” Barnett is right that this would be “a radical conclusion” that the Supreme Court would not adopt. But he is wrong that Judge Sutton’s analysis leads to this conclusion. The problem is not the absence of any way to challenge the constitutionality of the individual mandate, but rather the difficulty of winning on such a challenge given the applicable substantive law.

A key question in determining the success of a facial challenge (understood here as a challenge that seeks to demonstrate the unconstitutionality of a particular statutory provision in all its applications) is the applicable substantive law. Judge Sutton’s analysis reveals the plainitffs’ theory of constitutional invalidity to be an overbreadth theory akin to one rejected by the Supreme Court in Raich.

The nature of the plaintiffs’ Commerce Clause overbreadth theory can be revealed by contrast with First Amendment overbreadth doctrine. That doctrine can ground a successful facial challenge to a law that reaches both protected and unprotected speech. If the unconstitutional sweep of the law is too broad relative to the constitutional sweep of the law, then the law may not be validly applied to any speech. The law is completely unconstitutional.

One feature of Commerce Clause doctrine that should be particularly clear after Raich is that the relationship between the valid reach of legislative power considered, first, on an application-by-application basis and, second, on the basis of the reach of a statute as a whole, is the opposite of First Amendment overbreadth doctrine. Whereas overbreadth allows one to reason from the invalidity of some applications to the invalidity of all applications, Commerce Clause doctrine allows one way of reasoning from the validity of the set of all applications to the validity of some subset of applications.

Consider Raich itself. The Court analyzed the CSA as comprehensive drug-control legislation to regulate the interstate market in a fungible commodity, and refused to excise an individual component of that larger scheme. The validity of the CSA’s application to the challengers’ intrastate, non-commercial activity followed from the fact that Congress’s inability to reach the challengers’ activity “would leave a gaping hole in the CSA.” In other words, the Supreme Court in Raich viewed Congress’s inability to apply its law to a subset of activities that would be outside Congress’s power when considered apart from a comprehensive regulatory scheme as a reason for concluding that Congress did have the authority to reach those activities as part of a comprehensive regulatory scheme.

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Ilya Somin, Jonathan Adler, and Randy Barnett have criticized Judge Sutton’s reliance on the distinction between facial and as-applied challenges in upholding the minimum-essential-coverage provision of the Affordable Care Act. Before I had the chance to read Judge Sutton’s opinion carefully, my initial reaction was also critical of this aspect of Judge Sutton’s opinion. After Raich, it seemed difficult to conceive of a non-facial analysis of constitutionality under the substantial effects prong of the Commerce Clause, when Congress seeks to justify an exercise of legislative power as an essential part of a larger scheme that regulates interstate commerce.* It now seems to me, however, that Judge Sutton’s analysis reveals how the challengers to the individual mandate make a similar mistake to one made in Raich, although in a different guise.

The challengers in Raich did not challenge Congress’s authority to enact any particular provision of the Controlled Substances Act, but argued that “the CSA’s categorical prohibition of the manufacture and possession of marijuana as applied to the intrastate manufacture and possession of marijuana for medical purposes pursuant to California law exceeds Congress’ authority under the Commerce Clause.” The Court rejected this attempt to carve out a subset of the regulated activities as beyond Congress’s power. The Court drew from Wickard the principle that “Congress can regulate purely intrastate activity that is not itself ‘commercial,’ in that it is not produced for sale, if it concludes that failure to regulate that class of activity would undercut the regulation of the interstate market in that commodity.” As applied to the challengers’ activities in Raich, the Court held that “Congress had a rational basis for believing that failure to regulate the intrastate manufacture and possession of marijuana would leave a gaping hole in the CSA.” This reasoning clearly forecloses any attempt to view the challengers’ as-applied claim apart from the reach of the statute more broadly; Congress could reach intrastate activity as part of “comprehensive legislation to regulate the interstate market in a fungible commodity.” Confronted with comprehensive drug-control legislation, the Court concluded that it would “refuse to excise individual components of that larger scheme.”

The Court distinguished the challenge in Raich from those in Lopez and Morrison on the ground that the parties in those earlier cases “asserted that a particular statute or provision fell outside Congress’ commerce power in its entirety.” This distinction is “pivotal,” said the Court in Raich, because “we have often reiterated that ‘[w]here the class of activities is regulated and that class is within the reach of federal power, the courts have no power ‘to excise, as trivial, individual instances’ of the class.'” (Raich, quoting Perez, quoting Wirtz.)

The “individual mandate” challengers learned this lesson from Raich and challenged an entire statutory provision: 26 U.S.C. 5000A. But here’s where it gets interesting. The theory of invalidity that they advance–at least so far as Judge Sutton understood that theory–is a carve-out theory like that advanced in Raich. The terminological distinction between “individual mandate,” as the challengers call the provision, and “minimum essential coverage provision,” as the government refers to it, does much of the work. The “mandate” is to possess insurance of a certain sort. A penalty attaches to the failure to possess insurance. This requirement, by its terms, applies both to those who already have the requisite insurance (and are required to maintain it) as well as those who do not have the requisite insurance (and are required to obtain it). The challengers’ theory, as Judge Sutton understands it, aims only at the latter category. Although the challengers do not purport to seek “to excise, as trivial, individual instances of the class” of regulated activities, their theory of invalidity reaches only a subset of the regulated class of activities.

Put another way, the challenged provision does not simply require those without insurance to go out and buy it. It also requires those with insurance to keep it. And Judge Sutton concludes that it is not beyond Congress’s power to require those with insurance to maintain it. It is only at this point that the distinction between facial and as-applied challenges does any work in Judge Sutton’s analysis. The work it does is this: Because a facial challenge must fail if the challenged provision is constitutional in some applications, a theory that (at most) demonstrates the invalidity only of some applications of the individual mandate must result in rejection of the facial challenge. On this approach, a reviewing court need only determine whether the facial challengers’ theory would demonstrate the unconstitutionality of a provision across the board if accepted. If it would not do so, then the facial challenge must be rejected.

*(That analysis may be better conceptualized as an inquiry into whether a particular exercise of legislative power is necessary and proper to a regulation of interstate commerce, but the difference is unimportant for the facial vs. as-applied analysis, so we can leave this distinction to the side for now.)

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