FOURTH CIRCUIT VACATES HEALTH-CARE RULINGS
This one is going to have the tea partiers in an uproar, starting with this quote from page 22: This prohibition rests on the recognition that a state possesses no legitimate interest in protecting its citizens from the government of the
Todays opinion, written by Judge Motz on behalf of Judges Davis and Wynn, is in my view an unassailable explanation of why states cant litigate against the federal government in this way. Strictly speaking, the decision is one of standing. The fundamental holding here is that
Over the course of the opinion, there are plenty of barbs directed at the Commonwealth. The undercurrent of each of them is the Supremacy Clause, the result of which is that states cant sue to enforce state law that conflicts with federal law. Here are some of the bon motz (my apologies to her honor for this dreadful pun on her name; but I mean no harm) in the opinion:
- By contrast, the VHCFA regulates nothing and provides for the administration of no state program. Instead, it simply purports to immunize
citizens from federal law. Virginia
- Rather, the only apparent function of the VHCFA is to declare
- [T]he VHCFA, because it is not even hypothetically enforceable against the federal government, raises only abstract questions of political power, of sovereignty, of government.
Virginia Virginiacould enact a statute declaring that no Virginia
- Thus, if we were to adopt
This decision comprises three separate opinions a majority, written by Judge Motz, followed by a concurrence by Judge Wynn and a dissent filed by Judge Davis. The primary issue here is whether the penalty imposed for failure to comply with the individual or employers mandate is a tax or not. If it is, then this action is barred by the Anti-Injunction Act. That act prohibits suits to enjoin the collection of a tax (you have to pay the tax and then sue for a refund). Obviously, no penalties have yet been paid under the Act, since the mandates don’t kick in until 2013. That makes this a jurisdictional issue, too, but this time, the judges don’t agree.
Judge Motz rules that the penalties are taxes, so the AIA bars the litigation; she declines to reach the merits of the underlying legal issue (the constitutionality of the Health Care Act). Judge Davis thinks the courts can reach the merits, and he would rule that the Act is constitutional under Congresss taxing powers. Judge Wynn agrees with Judge Motz that the AIA prohibits this action, but he goes on to express his agreement on the merits with Judge Davis. Accordingly, we have an interesting division of views that all essentially lead to the same conclusion more or less. Two judges feel that the Act is constitutional, and two judges believe the courts cant get to that legal question.
One interesting aspect of this decision is that before reaching the merits, the district court ruled that the AIA didnt bar its consideration of the litigation. On appeal, neither side took issue with that ruling. The plaintiffs obviously didnt, because they didnt want to get thrown out of court on their collective ear. And the Secretary of the Treasury didnt gripe, presumably because he wanted a ruling affirming that the Act was constitutional. You cant get such a ruling if the courts decide that they cant consider the case.
Accordingly, on appeal neither party briefed the AIA issue until the appellate panel directed them to do so. Unsurprisingly, both sides argued in those supplemental briefs that the AIA did not bar the litigation. Despite this veneer of accord between the parties, the appellate court reaches the opposite conclusion, reflecting the fact that parties cannot make binding admissions or stipulations on matters of law.
So, who won today? In a sense, both sides did, although the Secretary would have liked that solid affirmance of the Act. The university and the citizens at least live to fight another day (although probably not in this litigation); todays ruling leaves open the question of whether a citizen, or even an employer like the school, may pay the penalty in 2013 and then file suit to recover the payment. The AIA only prohibits injunctions against the assessment or collection of a tax; it doesnt bar suits to recover taxes already paid.
Of course, theres always the possibility of an appeal on to