Fourth Circuit Vacates Lower Court Ruling Adverse to ObamaCare

September 8th, 2011

By Dan Miller

ObamaCareOn January 31, 2011, Judge Henry Hudson of the U.S. District Court for the Eastern District of Virginia held ObamaCare an unconstitutional enactment under the Commerce Clause. On September 8th, the Fourth Circuit Court of Appeals held that the plaintiff there, the Commonwealth of Virginia, lacked standing to seek judicial resolution of the matter. The text of the Fourth Circuit decision is here. Finding that Virginia lacked standing, the court vacated the lower court’s decision and remanded it for dismissal.

Virginia’s claim of standing had been predicated on a Virginia statute. The court notes,

the sole provision challenged here — the individual mandate –- imposes no obligations on the sole plaintiff, Virginia. Notwithstanding this fact, Virginia maintains that it has standing to bring this action because the individual mandate allegedly conflicts with a newly-enacted state statute, the Virginia Health Care Freedom Act (VHCFA). …

The VHCFA declares, with exceptions not relevant here, that “[n]o resident of this Commonwealth . . . shall be required to obtain or maintain a policy of individual insurance coverage.” Va. Code Ann. § 38.2-3430.1:1. It contains no enforcement mechanism.

Accordingly, the court held that ObamaCare imposes no cognizable obligations on Virginia. The court also held that Virginia cannot act on behalf of her citizens in challenging ObamaCare. However, the court did not reach the issue of the constitutionality of ObamaCare.

In a companion case, Liberty University, et al v. Sebelius, et al, the University had sought to enjoin

as unconstitutional, enforcement of two provisions of the recently-enacted Patient Protection and Affordable Care Act. The challenged provisions amend the Internal Revenue Code by adding: (1) a “penalty” payable to the Secretary of the Treasury by an individual taxpayer who fails to maintain adequate health insurance coverage and (2) an “assessable payment” payable to the Secretary of the Treasury by a “large employer” if at least one of its employees receives a tax credit or government subsidy to offset payments for certain health-related expenses. The district court upheld these provisions, ruling that both withstood constitutional challenge. Because this suit constitutes a pre-enforcement action seeking to restrain the assessment of a tax, the Anti-Injunction Act strips us of jurisdiction. Accordingly, we must vacate the judgment of the district court and remand the case with instructions to dismiss for lack of jurisdiction.

The dismissal of these two cases on procedural grounds does not necessarily cut one way or another, for or against ObamaCare.

A dissent to the Fourth Circuit’s majority opinion argued that the district court had had jurisdiction to decide the Liberty University case.

I would hold that the AIA does not deprive federal courts of jurisdiction to adjudicate the constitutionality of the Affordable Care Act. I would further hold that each of appellants’ challenges to the Act lacks merit and that, specifically, both the individual and employer mandates pass muster as legitimate exercises of Congress’s commerce power.

The Virginia decision is relatively short, only thirty-three pages in length. The Liberty University decision is one hundred and forty pages long, including the more interesting dissent. Both were published this morning and, although I have skimmed them, analyzing them requires more than that. Suffice it to say for now that if the arguments advanced in the dissent in favor of ObamaCare are the best defense of it that can be made, it should be a loser.

(This article was first published at The PJ Tatler.)


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