Appeals Court Dismisses Cases Challenging Health Reform Law
The 4th U.S. Circuit Court of Appeals in Virginia on Thursday dismissed two lawsuits challenging the federal health reform law, the New York Times reports (Sack, New York Times, 9/8).
Panel Rules Virginia Does Not Have Standing To Sue
The three-judge panel considered a state lawsuit -- filed in March 2010, shortly after the health reform law was enacted -- in which Virginia Attorney General Ken Cuccinelli (R) argued that the individual mandate is unconstitutional and conflicts with a state law that protects state residents from such federal insurance mandates.
In a December 2010 ruling, U.S. District Court Judge Henry Hudson agreed with the state's argument, ruling that the mandate is unconstitutional because it exceeds Congress' power to regulate interstate commerce. However, Hudson did not invalidate the law or block its implementation. In its formal notices of appeal, the Obama administration argued that Hudson was wrong in his ruling on the mandate (California Healthline, 5/11).
The 4th Circuit Court ruled 3-0 that Cuccinelli does not have legal standing for the lawsuit.
Judge Diana Gribbon Motz wrote in a unanimous opinion that states cannot grant themselves standing to rebuke federal laws by creating statutes that declare such laws invalid. She wrote that a state does not "acquire some special stake in the relationship between its citizens and the federal government merely by memorializing its litigation position in a statute" (New York Times, 9/8).
Cuccinelli said he plans to appeal the ruling to the Supreme Court (AP/Washington Post, 9/8).
Court Rules Liberty University, Individuals Must Wait To File Suit
The appellate court also considered a lawsuit filed by Liberty University and several individuals (New York Times, 9/8).
In the Liberty lawsuit, university officials and five state residents argued that Congress exceeded its constitutional authority by requiring the university and other similar entities and businesses that employ more than 50 people to provide health insurance coverage. The university argued that it potentially could face as much as $1.1 million in fines if the requirement is upheld.
The lawsuit also challenged the law's individual mandate and claimed that the law violates the school's and individuals' religious rights because some of the money collected through new insurance regulations would be used to cover abortion, which the Christian university opposes.
U.S. District Court Judge Norman Moon in a November 2010 ruling dismissed the university's lawsuit and upheld the constitutionality of the law. The school then appealed to the 4th Circuit Court (California Healthline, 5/11).
According to a 2-1 decision by the 4th Circuit Court, the plaintiffs do not have standing to challenge the mandate because its financial penalties amount to a tax (AP/Washington Post, 9/8). The court said it does not have jurisdiction to rule on whether the mandate is constitutional because the federal Anti-Injunction Act requires U.S. residents to wait to oppose a tax until after it is collected.
The 4th Circuit Court is the first court to agree with Obama administration lawyers that the mandate's penalty is a tax (Haberkorn, Politico, 9/8).
Judge James Wynn wrote in a concurring opinion that if the court had gotten to rule on the merits of the case, he still would have upheld the individual mandate based on Congress' power to levy taxes (New York Times, 9/8).
Judge Andre Davis wrote the dissenting opinion, where he disagreed that the Anti-Injunction Act prevented the court from having jurisdiction. However, he said that given the opportunity, he still would have upheld the law, calling it "a far more limited exercise of federal power than appellants fear" (Adamy, Wall Street Journal, 9/9).
The three judges on the panel were randomly selected. All three were nominated by Democrats: Motz was nominated by President Clinton, while Davis and Wynn were nominated by President Obama (Politico, 9/8).
Liberty University attorney Mathew Staver said he plans to appeal the rulings to the Supreme Court (AP/Washington Post, 9/8).
Path to the Supreme Court
Last month, a three-judge panel for the 11th Circuit Court of Appeals in Atlanta ruled that the individual mandate is unconstitutional. The decision marked the first time an appellate court had ruled against any part of the law. Meanwhile, judges for the 6th U.S Circuit Court of Appeals in Cincinnati in June upheld a lower court ruling that the requirement is constitutional.
Experts say the divergent rulings increase the likelihood that the Supreme Court will make the final decision on the mandate, since the high court more readily accepts cases where lower courts are split.
Many analysts expect the Supreme Court to consider the case during its upcoming term, which begins in October. This means it would issue a decision no later than June 2012 (California Healthline, 8/15).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.