March 6, 2013

PLF urges Fourth Circuit: give business owners the chance to prove their cases

By PLF urges Fourth Circuit: give business owners the chance to prove their cases

Under legal precedents established in the 1930s, business owners who want to defend their constitutional right to earn a living against unreasonable government interference face a very difficult task. They must overcome the “rational basis test,” a legal theory that says the judge must presume that the law is constitutional and the business owner is forced to “disprove every rational basis for the law.” That’s very hard to do—it requires you to prove a negative, for one thing, and since the courts will uphold the law even on a legal theory that the legislature didn’t have in mind when it wrote the law, this test even requires you to concoct an indefinite number of speculative justifications for the law and then disprove them all.

Needless to say, business owners rarely win under this unfair “test.” But it is possible. Plaintiffs have won many important rational basis lawsuits. And the Supreme Court has always said that when a person brings a rational basis case, he or she at least should have the right to try to convince the judge that the law is unconstitutional. In fact, in 1934—only months after the Court first adopted the rational basis test—the justices explained in a case called Borden’s that that test

is a presumption of fact of the existence of factual conditions supporting the legislation. As such, it is a rebuttable presumption. It is not a conclusive presumption, or a rule of law which makes legislative action invulnerable to constitutional assault. Nor is such an immunity achieved by treating any fanciful conjecture as enough to repel attack. When the classification made by the legislature is called in question, if any state of facts reasonably can be conceived that would sustain it, there is a presumption of the existence of that state of facts, and one who assails the classification must carry the burden of showing by a resort to common knowledge or other matters which may be judicially noticed, or to other legitimate proof, that the action is arbitrary.

Unfortunately, in recent years, courts have tended to ignore this warning, and some have thrown out rational basis lawsuits at the motion to dismiss stage—before any discovery or fact-finding. For example, in our recent case on behalf of dairyman Hein Hettinga, the trial court threw the case out without allowing Hettinga even to introduce evidence, simply because the government said the law was constitutional. The Court of Appeals allowed this, on the theory that if the judge can imagine a justification for the law, that’s enough to defeat the case without even allowing the Plaintiff to try to prove his or her allegations. If the government simply asserts, without any facts, that the law is rational, the court throws out the lawsuit; in other words, the court treats “fanciful conjectures” as “enough to repel” a constitutional argument, transforming the rational basis test from an evidentiary presumption into an impenetrable shield.

That’s what a federal judge in Virginia did in a recent decision dismissing a lawsuit that challenges that state’s burdensome “Certificate of Need” law restricting the purchase of medical equipment. Explicitly declaring that actual evidence is irrelevant in rational basis cases, the judge ruled that the plaintiffs, represented by our friends at the Institute for Justice, weren’t allowed to even try to prove their case.

Now that case is on appeal, and PLF filed this brief today arguing that whatever one thinks about the rational basis test, it should at least allow people the chance to prove their claims. We explain that not only in the Borden’s case, but in several other cases in the 1930s, the Supreme Court made clear that evidence matters in rational basis cases. Even Justice Brandeis—hardly a fan of economic liberty—ruled that business owners should have the right to introduce evidence to prove that laws are irrational and unconstitutional. And that’s still true. In his swing opinion in Kelo v. New London, for instance, Justice Kennedy said that while eminent domain is subject to the rational basis test, plaintiffs who argue that a condemnation is unconstitutional must be given the opportunity to submit their evidence to the judge for a fair trial.

If “rational basis” isn’t to become a set of magic words—“close sesame,” you might say—that bars any constitutional challenge to government’s actions, then courts must at the very minimum allow plaintiffs their day in court to make their constitutional arguments. That’s the least—the very least—that judges can do to safeguard individual liberty.

You can learn more about this issue in my current paper-in-progress on motions to dismiss and the rational basis test.

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