Obamacare

The Non-Recusal Tradition

Conservatives and the New York Times may agree on one thing: it’s time for the Supreme Court to get serious about producing a framework where Justices can, and do, regularly recuse themselves from matters in which they’ve had an interest. For my part, I disagree. Though there’s a better case to be made for Thomas’ recusal than for Kagan’s in the upcoming Obamacare case, I don’t think either is necessary.

As to Kagan, the path from the Solicitor General’s office to the high Court is a common one. The Solicitor General tends to attract the best legal talent, the lawyers most comfortable in front of the Supreme Court and at the bleeding edge of executive law, and those most interested in public service. In qualifications and in character, for those individuals, the Supreme Court is a quite natural next step, which is why the path describes so many justices from Taft to Kagan. Consequentially, the conflict of interest problem is one that we’ve confronted before: Justices are expected to check their prior careers at the door, and historically, they do just that. In the famous case of Youngstown Tube & Sheet Co. v. Sawyer, Justice Jackson’s concurrence survives as a strong limit on executive power, despite the fact that, as FDR’s Attorney General, Mr. Jackson advocated precisely the vision of executive power that he later denied President Truman. It’s an irony that Justice Vinson noted in dissent — he conspicuously and repeatedly cites pro-executive opinions Mr. Jackson authored as Attorney General — but not one that Justice Jackson appears to acknowledge at all. And that’s the way it should be. The Attorney General frames the law as his client would prefer it; a Justice of the Supreme Court frames the law as it is.

We have no reason to expect Justice Kagan would conduct herself otherwise. Even if Ms. Kagan had been involved in discussions on the individual mandate’s constitutionality (which seems unlikely — this whole Tenth Amendment resurgence is utterly new, remember), she will know and should be trusted to follow her predecessor’s example. The alternative — requiring recusal in every case an attorney encountered in her previous life — is untenable.

No such precedent exists to judge the propriety of Justice Thomas’ actions. It is literally a creation of the twenty-first century for a Justice of the Supreme Court to actively take a role in forming the political climate necessary for the creation of a case he will later decide. Imagine if Chief Justice Marshall had taken to talk radio to blast John Adams (“Jefferson should rescind those midnight appointments, just to show those Federalist dogs what’s what!”), and then gone on to write the decision in Marbury v. Madison.

We’d certainly have reason to doubt the legitimacy of the result. But I’m unable to frame a rule that would require Thomas’ recusal, and not set us on a slippery slope towards recusing any Justice with expressed political opinions. Since that outcome is neither tenable nor desirable, we should probably admit that when Obamacare comes before the Supreme Court, the mandate’s fate will be decided by all nine justices.

“Obama vs. the Commerce Clause”: an Answer to Richard Epstein

Unlike your average Tea Party “scholar,” who’s managed to convince himself that child labor laws are somehow an ungodly restriction on individual liberty, Professor Richard Epstein is a profoundly intelligent man. Which is why I take his constitutional arguments against ObamaCare deathly seriously. Epstein isn’t one to fantasize about a world where Lochner v. New York remains the law, or to rely on some zombified Tenth Amendment as an independent substantive barrier to federal action. No, unlike the majority of “constitutional conservatives,” Epstein operates in the real world. He’s still wrong.

His argument revolves around a Marshall court case — Gibbons v. Ogden, 22 U.S. 1 (1824) — where the Supreme Court put the Commerce Clause together with the Supremacy Clause to hold that in the realm of interstate commerce, state law yields to federal law. Couldn’t be simpler, or more clearly accurate. Professor Epstein pulls one limitation from the case, and builds out on it:

State inspection laws, health laws, and laws for regulating the internal commerce of a State, and those which respect turnpike roads, ferries, &c. are not within the power granted to Congress. [...]

It is not intended to say that these words comprehend that commerce, which is completely internal, which is carried on between man and man in a State, or between different parts of the same State, and which does not extend to or affect other States. Such a power would be inconvenient, and is certainly unnecessary. Comprehensive as the word ‘among’ is, it may very properly be restricted to that commerce which concerns more States than one.

Emphasis mine — the underlined element represents the linchpin of Epstein’s argument. As he reads it, individual “inaction,” as in the failure to purchase insurance, is a decision that takes place inside the boundaries of a state, whose effects fail to “concern[] more States than one.” Consequentially, Congress may not regulate that decision by means of the individual mandate and therefore, “if Gibbons were still law, ObamaCare wouldn’t stand a chance before the Court.”

It’s an interesting construction of Gibbons‘ meaning in the overall constitutional structure, but one that ignores several other constitutional traditions, some of which also trace their histories to the Marshall Court. Specifically, Epstein overlooks the Necessary and Proper Clause, and fails to parse the distinction between constitutional inquiries concerning Congress’ legislative ends, and the means Congress may deploy to those ends. Gibbons speaks to the goals Congress may pursue, not the tools it may use to accomplish those goals. That latter inquiry, and the one that governs the individual mandate’s constitutionality, is comparatively broader.

Once Congress chooses a valid legislative target, its toolkit is circumscribed only by rationality. Under McCulloch v. Maryland, 17 U.S. 316 (1819), if a national problem properly falls within the Commerce Clause, Congress may deploy “appropriate” solutions to that problem. Per Chief Justice Marshall:

Let the end be legitimate, let it be within the scope of the constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consist with the letter and spirit of the constitution, are constitutional.

Emphasis mine, again. This is an issue of argument framing. Let’s assume that Epstein properly reads Gibbons. Still, the target of congressional action that must occur “among” rather than “within” the states isn’t the individual decision to opt out of the insurance markets — it’s the interstate insurance system itself. From there, Congress derives its power to mandate individual decisions taking place within state borders based on the Necessary & Proper Clause, provided such regulation is a rational means to the constitutional end. To be sure, it’s a strange thing that Congress may target instrastate activity in support of an interstate commerce issue, but that’s a power even more settled than the admittedly aberrational Wickard v. Filburn — which Epstein also has to wish away for his argument to hold together. Per no lesser a conservative light than Justice Scalia, in his concurrence Gonzales v. Raich, 545 U.S. 1 (2005), which bothers to cite all of Epstein’s favorite cases before concluding:

Our cases show that the regulation of intrastate activities may be necessary to and proper for the regulation of interstate commerce in two general circumstances.

ObamaCare is nothing so controversial as Epstein, or conservative America, would like to think. This is going to be a 6-3 decision at least, provided the government’s advocates frame it in the right way, and avoid Epstein’s trap. Which they will.

Reading the Supreme Court’s Grant in the “ObamaCare” Litigation

SCOTUSblog offers full analysis of the Court’s order (PDF) granting certiorari, to which we add only limited points. First, take into consideration the length of the argument — five and a half hours, broken over several days:

The allotment of 5 1/2 hours for oral argument appeared to be a modern record; the most recent lengthy hearing came in a major constitutional dispute over campaign finance law in 2003, but that was only for 4 hours.   The length of time specified for the health care review was an indication both of the complexity of the issues involved, and the importance they hold for the constitutional division of power between national and state governments.   (In its earlier years, the Court customarily held days of oral argument on important cases; the modern Court, however, ordinarily limits oral argument to one hour per case.)

Any appellate lawyer will tell you, the length of time for argument provides a reliable indication of not just how important the case is, or its complexity, but how seriously the Court regards the issues at play. As such, the record-setting argument time is properly viewed as bad news for supporters of President Obama’s historic reform. Although, on the flip side, it could just be signalling: even if the Court thought the case was a done deal, for one side or the other, could they really short-change the argument without alienating the losing faction? Especially post-Roe, the modern Court should — and does — often consider its institutional legitimacy in casting its orders. Call it the legacy of a modern Republican Party willing to cynically declare war on a coordinate branch of government, just to preserve its political relevance.

But the grants aren’t without some good news for reform supporters. The Court also took cert as to the jurisdictional question — on whether the individual mandate can actually be overturned before it ever goes into effect. And the Supreme Court also added an issue sua sponte [at its own request]:

Whether the suit brought by respondents to challenge the minimum coverage provision of the Patient Protection and Affordable Care Act is barred by the Anti-Injunction Act, 26 U.S.C. § 7421(a).

As a threshold matter, note an error in the Court’s order. 26 U.S.C. § 7421(a) refers to the “Tax Anti-Injunction Act”; not the “Anti-Injunction Act,” a statute familiar to federal courts scholars that bars federal actions to restrain a state court proceeding, which is codified at 28 U.S.C. § 2283.  The TIAI operates as part of the jurisdictional mechanic that prevents taxpayers from suing to enjoin a tax: to challenge a potentially illegal tax, instead, prospective litigants must pay the tax, and then sue for a refund. By inserting a TIAI issue, the Court appears to openly contemplate that the individual mandate is best understood as a tax, or something sufficiently similar to trigger the policy concerns bound up in the TIAI. Taking the Court at face value, they could be hinting that the individual mandate is a tax (a position rejected by all the lower courts), separately sustainable under the general welfare clause, and that any suit against it is premature. It’s a quick way for the Court to get the case off their docket, or resolve it on objective principles not bound up in politics. Functionally, the Court would punt on the more serious question of the role of government and the scope of the Commerce Clause. And as we all know, the Court loves to punt.

Regardless, none of this changes this fundamental calculus that this is an easy case, resolved in the reformers’ favor by reference to clear precedent. I’ve just bet one of my lawyer friends $100 that the Court comes out in reformer’s favor, in some fashion, and it’s a good bet.

Flagship “ObamaCare” Suit Founders in the Fourth Circuit

Per the ridiculously well-regarded Judge Diane Motz (pdf). Remember, this reverses a previously favorable decision by Judge Sutton Hudson [Thanks Rachel! -ed.]. So wipe one hash mark off the tea party “win” column, and replace it on our side:

To permit a state to litigate whenever it enacts a statute declaring its opposition to federal law, as Virginia has in the VHCFA, would convert the federal judiciary into a “forum” for the vindication of a state’s “generalized grievances about the conduct of government.” Flast v. Cohen, 392 U.S. 88, 106 (1968). Under Virginia’s standing theory, a state could acquire standing to challenge any federal law merely by enacting a statute — even an utterly unenforceable one — purporting to prohibit the application of the federal law. For example, Virginia could enact a statute declaring that “no Virginia resident shall be required to pay Social Security taxes” and proceed to file a lawsuit challenging the Social Security Act.  Or Virginia could enact a statute codifying its constitutional objection to the CIA’s financial reporting practices and proceed to litigate the sort of “generalized grievance[]” about federal administration that the Supreme Court has long held to be “committed to the . . . political process.” United States v. Richardson, 418 U.S. 166, 179-80 (1974) (internal quotation omitted).

Thus, if we were to adopt Virginia’s standing theory, each state could become a roving constitutional watchdog of sorts; no issue, no matter how generalized or quintessentially political, would fall beyond a state’s power to litigate in federal court. See, e.g., id.; Schlesinger v. Reservists Comm. to Stop the War, 418 U.S. 208, 227 (1974). We cannot accept a theory of standing that so contravenes settled jurisdictional constraints.

And so Kenneth Cuccinelli’s dalliance into constitutional adventurism ends with a stellar rebuke of tea party-influenced nullification theories. Congratulations, Virginia taxpayers! It takes a big man to gamble his state’s money and his political career on a legal theory rejected before the Civil War; but it takes a very special electorate to let him.

Corporate Death Panels: Insurance Hoops

We all remember — how could we not — Sarah Palin’s alarmist fears about how the government would “ration” healthcare, leading nameless, faceless bureaucrats to make decisions that could kill off disfavored elements of the population, like sick children and the elderly. Palin’s li(n)e was always inflammatory, contributing to the climate of extremism Republicans apparently need to win elections, and it was always wrong.

But now, please consider this short anecdote on the rationing we already experience, with privately-held insurance companies.

*     *     *

I have a friend with a mild medical… thing. It’s not a big deal, and it’s certainly not serious, but left uncared-for, it could prove “unfortunate.” The treatment regimen requires monthly medication — preferably on the 28-day mark — all of which is very expensive.

Prior to the effective date of this part of the Affordable Care Act, his insurer would pick and choose months to deny coverage, claiming it was a “pre-existing condition.” It isn’t. He’s been covered his whole life, and was diagnosed only in ninth grade. Also, it’s not a thing that could go away, absent some radical new medical therapy, a breakthrough in pluripotent stem cells, or (hey, why not) nanotechnology.

Maddeningly, the timing of the denials conclusively proved that the insurer’s goal was to harass its customers out of coverage — not to avoid genuine overcharges. According to his insurer, this monthly medication could be a “pre-existing condition” in April, but not in May; in June, but not in August.  Such arbitrariness doesn’t make sense, unless the insurer’s only goal is to make customers work for their coverage. Imagine an elderly, infirm couple, facing the same strategy: at what point do they just give up? Private insurers may not know, but given enough bad-faith denials, they expect some patients will.

Thankfully, “ObamaCare” made this type of harassment illegal. But here’s the new trick: my friend’s insurer switched to a new “specialty pharmacist,” who’s demanding proof that the treatment is still medically indicated, despite the fact that, as any doctor would know, his condition is permanent. He’s submitted proof to that effect, but the pharmacy & insurer are still stalling the approval. In the meantime, he’s already one week late for his treatment.

As stated, my friend’s condition isn’t serious. This delay isn’t good for him, but it certainly won’t kill him.

But what if it could? Where for-profit healthcare is concerned, the unrestrained free market just doesn’t work. Why do we pretend the private sector is always superior to the public?

The Eleventh Circuit on “ObamaCare”: How the Tea Party Actually Lost

See others’ take on the same.

Set aside the Court’s holding that the individual mandate represents an inappropriate expansion of the Commerce Clause — to which this is a proper rejoinder.  Instead, when reading the monolithic opinion (pdf), take note of Section III.B, which begins on page 55, and rejects the Plaintiffs’ attempt to read serious force into the Tenth Amendment. Functionally, the Court holds that there is no external, Tenth Amendment limitation on the spending power, absent “coercion”:

The Tenth Amendment places certain limitations on congressional spending; namely, that Congress cannot place restrictions so burdensome and threaten the loss of funds so great and important to the state’s integral function as a state—funds that the state has come to rely on heavily as part of its everyday service to its citizens—as to compel the state to participate in the “optional” legislation. This is the point where “‘pressure turns into compulsion.’”

The Court takes the coercion doctrine seriously — which is itself an indication of how far off-base the rest of the decision is — but that’s the extent of the discussion. The larger tea party argument, that healthcare isn’t a government function recognized by the Constitution, was either dropped on appeal, brushed aside, or both. An interesting question here is why right-wing lawyers won’t adopt, as a litigating position, a constitutional vision that their legions of followers purport to believe. Is it because the lawyers know it’s frivolous, invented, fake constitutionalism?

That said, credit to the dissent for going somewhat off the reservation — a dissenter’s sovereign right — to identify the background concern for individual economic liberty, and sharply correct it. Start at page 281, or, I’ve excerpted the best parts below the jump, with legal prose intact, so we can fully appreciate the breadth of the plaintiffs’ alarmism, and the depth of their error.

Long story short, the 11th Circuit’s decision represents a political victory for the increasingly radicalized right. But it’s a defeat for the larger tea party movement’s recidivist vision of the Constitution, in that their soldiers, assured of defeat, have abandoned the battlefield where it matters most:

Continue reading »

A First Appellate Loss for “ObamaCare” Detractors

The Thomas More Law Center — conservative America’s answer to the ACLU — is no stranger to defeat, whose acquaintance they made again today, as the Sixth Circuit became the first court of appeals to issue a decision on “ObamaCare,” and the first to sustain the Act (pdf). The majority decision comes as a thorough rejection of the conservatives’ favorite distinction — between regulating activity and inactivity. Per the Court:

The Supreme Court has never directly addressed whether Congress may use its Commerce Clause power to regulate inactivity, and it has not defined activity or inactivity in this context. However, it has eschewed defining the scope of the Commerce Power by reference to flexible labels, and it consistently stresses that Congress’s authority to legislate under this grant of power is informed by “broad principles of economic practicality.” Lopez, 514 U.S. at 571 (Kennedy, J., concurring). [. . . .]

Similarly, this Court has also refused to focus on imprecise labels when determining whether a statute falls within Congress’s Commerce Power.

Emphasis mine: it’s obvious that the Court sees this as rhetoric — not doctrine. Note too the citation to Kennedy’s concurrence. Pure diplomacy.

Contra some commentators on the right, eager for some good news, the Court expressly declined to consider, and therefore did not reject, the argument that the mandate constitutes a “tax.”

In light of the conclusion that the minimum coverage provision is a valid exercise of Congress’s power under the Commerce Clause, it is not necessary to resolve whether the provision could also be sustained as a proper exercise of Congress’s power to tax and spend under the General Welfare Clause, U.S. Const. Art. I, § 8, cl. 1.

Slip Op. at 26. And, before we get too excited about a “divided panel,” keep in mind that it’s the rare (and weak) case that results in a unanimous vote.

The Vanishingly Fine Line in the ObamaCare Litigation

The Eleventh Circuit breaks with most of its sister courts in not posting audio of argument online. So we must rely on the New York Times’ coverage to evaluate yesterday’s argument in State of Florida v. U.S. Dep’t of Health & Human Services, or, the Republican Party’s ongoing quest to invalidate a health care law that they practically wrote, because of socialism, or something.

Per the Times, the judges chose to focus on the question of when the government could require customers to opt-in to commerce, with this result:

It would be permissible, Mr. Clement [counsel for the states] acknowledged under questioning, for Congress to require insurance or other payment by those who are being treated in an emergency room, because they would already be in the stream of commerce. But he said it was a different matter to require them to pay prospectively for future care. [. . .]

But Mr. Katyal [counsel for the administration] urged the judges to see the law not as a mandate to buy an insurance policy, but as a regulation of the means of payment for care that individuals would inevitably consume. Americans would not be conscripted into the market, Mr. Katyal suggested, because the uniquely unpredictable demand for health care would have already placed them there.

“It’s all about financing,” Mr. Katyal asserted. “It’s about regulating whether people are paying cash or credit.”

With this formulation, I don’t see how we lose. Mr. Clement has conceded that life events may — because of the legal duties implied by their occurrence — bring someone inexorably into the stream of commerce, without any volitional act on the person’s part. But that concession gives away half of his argument, that regulable “commerce” requires an affirmative action. It also acknowledges the free rider problem, while rendering it unsolvable. The government can — but won’t — require insurance at the door of the emergency room. Only ex ante regulation can fulfill that need, and the individual mandate seems narrowly tailored to accomplish it. Mr. Clement would know better than me, but I expect that question was a trap, and he fell right into it.

Separately, it’s very disappointing to see a court not give free, easy access to recordings of oral argument, especially in this day and age. As a matter of good appellate practice, attorneys need to be able to revisit their performance to learn, and to gauge the necessity of post-argument filings (under Federal Rule of Appellate Procedure 28, or otherwise). Get with the times, guys.

“ObamaCare” Now 2 for 3

That’s not counting the six or so judges that’ve tossed challenges to the law on procedural grounds.

The latest sustainer comes from Gladys Kessler, a very highly respected jurist for the District of Columbia’s federal district court. The decision nails this critical point: the Supreme Court has twice rejected the notion that studied avoidance of interstate commerce thereby ducks the Commerce Clause. Opting out of the insurance industry is therefore reachable, because it still impacts the industry.

Critical quotes, from a PDF hosted by ThinkProgress. First, a choice is an action, even if it’s a choice not to act:

As previous Commerce Clause cases have all involved physical activity, as opposed to mental activity, i.e. decision-making,there is little judicial guidance on whether the latter fall swithin Congress’s power. [. . .] However, this Court finds the distinction,which Plaintiffs rely on heavily, to be of little significance. It is pure semantics to argue that an individual who makes a choice to forgo health insurance is not “acting,” especially given theserious economic and health-related consequences to every individual of that choice. Making a choice is an affirmativeaction, whether one decides to do something or not do something. They are two sides of the same coin. To pretend otherwise is to ignore reality.

And second, tea party hysterics are not constitutional arguments. Slip Op. at 45.

The crux of Plaintiffs’ arguments is that [the individual mandate] is an unprecedented attempt by Congress to regulate individual behavior, and thereforethreatens individuals’ freedom of choice. Appealing as this emotionally charged argument may sound, the ACA is not as unprecedented as Plaintiffs claim: as already discussed, Congress’s broad power to regulate individual behavior under the Commerce Clause is well established.

Slip Op. at 54. Ouch.

But the real fun starts late in the opinion. Plaintiffs in this case tried to state a claim under the Religious Freedom Restoration Act (RFRA), a Gingrich-era publicity stunt, summarily limited by the Supreme Court on most of its important provisions, that would have enlarged protections for religious conduct otherwise illegal, or limitable, under laws of general application. Naturally, the principle appeals to the Christian hard-right’s huge persecution complex but, as stated, RFRA was virtually neutered by City of Boerne v. Flores, 521 U.S. 507 (1997).

Plaintiffs didn’t get the memo, and argue, instead, that because they rely on God to protect their health, and “object[] to participation in the health insurance system, the Act imposes direct and substantial religious and financial burdens upon [them].” Well, no:

Finally, as Defendants point out, Plaintiffs routinely contribute to other forms of insurance,such as Medicare, Social Security, and unemployment taxes, whichpresent the same conflict with their belief that God will provide for their medical and financial needs.

And the ACA places no real burden on religious expression, because the Plaintiffs can opt out by paying the fee, and this is the least restrictive means of lowering healthcare premiums:

[W]hen pressed at oral argument to name a less restrictive means of lowering health insurance premiums or otherwise improving access to health care, Plaintiffs could not do so.

You see, unlike in Republican politics, we don’t operate, in law, under the premise that government doesn’t, shouldn’t, and can’t solve real problems. We actually have to think things through sometimes.

HotAir Doesn’t Really Get Litigation (or, Why “ObamaCare” Remains Valid)

Man, things like this are infuriating. Malkin’s pet website tries to draw an inference of bad faith, or bungling, from the White House’s request to Judge Vinson that he clarify that, during the pendency of appeals, the Affordable Care Act remains valid and enforceable. Legal scholar Ed Morrissey:

Essentially, the Obama administration wants Vinson to tell the states to obey an unconstitutional law.  This isn’t a necessary step for an appeal, although it might or might not be a prerequisite to an application for a stay at the 11th Circuit.  Either way, it’s a fool’s errand.  If a judge declares an entire law void on the basis of constitutionality, he is hardly likely to issue an order telling states to obey it anyway.

True, Vinson thinks the law is “unconstitutional.” But standard practice, as we’ve seen in the Prop 8 litigation, is to stay effect of such a judgment pending appeal. Judge Vinson’s judgment doesn’t take legal effect, and become enforceable, until that point, and because disturbing the status quo while awaiting appeal would throw the entire country into chaos, probably every day given the regularity of constitutional challenges to federal statutes, the Affordable Care Act remains intact.

Lawyers will know this. On one of my cases, we won a trial in, like, 2005 or something. But we can’t use the district court’s judgment to quash foreign proceedings against our client until the First Circuit affirms on appeal (as I think they will). And, last January, BNY Mellon lost an adversary proceeding to Lehman Brothers in the SDNY’s Bankruptcy Court. But they didn’t pay the damn thing until settlement, like, last month.

Can you imagine how it could be otherwise here? Critical thinking, guys.