May 10, 2011

PLF’s brief central in Fourth Circuit Obamacare argument

By PLF’s brief central in Fourth Circuit Obamacare argument

Author: Timothy Sandefur

This morning, judges on the Fourth Circuit Court of Appeals heard arguments in Virginia v. Sebelius, challenging the constitutionality of the Obama Administration’s health care law. But this morning’s argument (which you can listen to by clicking here) focused not on the merits of the law, but on the issue of standing, a somewhat technical legal subject that’s crucial because it determines whether the case should have been heard or thrown out in the first place. A party—including a state—can only sue if it has the legally recognized “standing” to do so, meaning that the plaintiff has been injured in some real way and that the court can do something about that injury. The government argues that Virginia has no standing to challenge Obamacare’s constitutionality, but PLF’s friend of the court brief (which you can read here) argues otherwise. We argue that states have a constitutionally recognized element of sovereignty—the power to define and protect individual rights—and that states can defend that sovereignty in court. In particular, we point to the famous case of McCulloch v. Maryland, where the state passed a tax on the national bank and then sued when the bank refused to pay that tax. Similarly, in this case, Virginia passed a law protecting citizens against being forced to buy health insurance, and therefore has standing to challenge the federal statute that contradicts the state law.

PLF’s brief was directly addressed several times during the oral argument—indeed, it was the only brief cited during the arguments. Virginia Solicitor General Duncan Getchell’s argument in general echoed PLF’s brief, and when asked whether a state “could challenge any statute, any federal statute, in court as long as the state first passes a law disagreeing with that statute,” he answered:

Well, as the Pacific Legal Foundation—

[Judge:] If you could just answer yes or no—

The answer is yes…. I’d like to point out what the Pacific Legal Foundation pointed out in its amicus brief, that in all probability, McCulloch v. Maryland, that Maryland tax statute was probably created in order to challenge the constitutionality of the Bank of the United States…. A co-sovereign is not to be deprecated. I don’t know why it’s some sort of low trick to pass [such] a law, because as you point out, it’s often very arduous to pass a law, and in fact this law passed overwhelmingly in two chambers controlled by different political parties.

The Obama Administration’s attorney, Neal Kaytal, responded to this argument, although in my opinion, his answer missed the point entirely:

My friend also suggested that the McCulloch case, relying on the Pacific Legal Foundation brief, was an example of state standing. That was the case in which the state of Maryland imposed a tax on financial institutions, including the Bank of the United States, that was one in which there was a sovereign interest, a state’s tax that was at issue there; they didn’t come into the court and say they were protecting their citizens there, they were protecting their tax….

But as we explain in the brief, Virginia’s sovereign interest in protecting citizens’ rights is no less substantial or constitutionally guaranteed than was Maryland’s sovereign interest in its tax. The Tenth Amendment reserves to states the power to do both: to protect citizens by promulgating laws, and to tax banks by passing taxation laws. Mr. Kaytal’s theory would lead to the absurd notion that Virginia could “manufacture” standing by taxing purchases of health insurance, and could go to court to defend that sovereign interest, but it cannot enact its Health Care Freedom Act and defend its right to do so in federal court. This is not a valid constitutional distinction. Virginia has a sovereign interest in articulating and protecting its citizens’ rights, and when it passes a law to do this, it should have the right to defend its interests in court. Massachusetts v. Mellon and other cases that suggest that this isn’t allowed are actually only political question cases—cases which were dismissed because the disputes at issue were only abstract political questions. But as Mr. Getchell argued, it’s no small matter for a state to pass a law—and when it does, it has used its constitutionally recognized sovereignty. That’s something Virginia should be able to take to federal court.

In all, a fascinating issue, and one which it will be interesting to see the judges work with.

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