Appeals decisions on Obamacare shape Supreme Court battlefield 

The Virginia-based 4th Circuit’s two Obamacare decisions virtually guarantee Florida’s Obamacare case will be the one heard by the Supreme Court next year.

Only five Obamacare cases are really significant. Two of these are the ones pursued by Virginia Attorney General Ken Cuccinelli, and Liberty University’s case argued by its law school dean, Liberty Counsel Chairman Mat Staver.

Both of these cases were argued before the U.S. Court of Appeals for the 4th Circuit. The three-judge panel hearing these cases consisted of one Clinton appointee and two Obama appointees. This solidly liberal panel handed down consequential judgments in both cases on Sept. 8.

The appellate court dismissed Cuccinelli’s case for lack of standing. Virginia had passed a law declaring its citizens weren’t required to purchase health insurance, creating a direct conflict with Obamacare’s individual mandate.

The court reasoned that courts have barred states from asserting the rights of its citizens, and that Virginia’s law did exactly that. Thus Virginia couldn’t sue in federal court.

Staver’s case for Liberty University is more complex. In addition to challenging the individual mandate, the university also challenged another section of Obamacare called the employer mandate.

Regarding the Liberty case, the court broke with every federal judge to decide an Obamacare case to date, holding that the individual mandate is a tax. As such, they held 2-1 that the Anti-Injunction Act bars any federal court from examining the mandate until someone pays the tax, which won’t occur until 2014. So that case too was dismissed.

This decision is shocking, given that the Supreme Court makes clear that a tax is when government takes your money for revenue, not as a penalty. Under the mandate, your money goes to an insurance company, not the government. And if you don’t buy insurance, you pay a penalty.

Judge Davis dissented, correctly noting, “When Congress has wished ‘penalties’ to be treated as ‘taxes,’ it has said so expressly.”

Davis also correctly observes that the Supreme Court has held the purpose of AIA is to ensure speedy collection of taxes, rather than let dissatisfied citizens tie up new taxes for years until court challenges are exhausted.

The majority’s provocative decision is well outside the mainstream, adopting a theory that would not allow any court to decide Obamacare’s constitutionality until 2015. The AIA requires no such result, and the court employs tortured reasoning to label the individual mandate a tax to reach this conclusion.

This may be the end of the line for both cases. The Supreme Court should take Cuccinelli’s case to consider his novel theory on a state’s standing to challenge a law like Obamacare. But if the court takes the case it will almost certainly limit the argument to the question of standing, not Obamacare’s constitutionality.

Likewise the court should take Liberty’s case to consider the constitutionality of the employer mandate. But it’s unlikely to do so with an appellate opinion fixated on the far-out tax theory, instead of more mainstream arguments regarding the Constitution’s Commerce Clause.

So while both of these cases should seek Supreme Court review, it may be the end of the line for both. If so, then all eyes are on the massive Florida case, which the Supreme Court will surely hear sometime in 2012.

Examiner legal contributor Ken Klukowski is a fellow with the American Civil Rights Union.

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Ken Klukowski

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Sunday, Sep 14, 2014

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