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Monday, July 8, 2019

On the Eve of Oral Argument in Texas v. U.S.

By Jonathan H. Adler - July 08, 2019 at 11:09PM

Tomorrow at 1pm Central (2pm Eastern), the U.S. Court of Appeals for the Fifth Circuit will hear oral argument in Texas v. U.S., the latest attempt to invalidate the entire Affordable Care Act in federal court. According to a notice on the court's website, no electronics may be used in the courtroom, but audio of the oral argument should be posted within an hour of its conclusion. (SCOTUS, take note!)

When we last checked in on the case, the Fifth Circuit had requested supplemental briefing on whether the court had appellate jurisdiction to hear the case. Among other things, the court asked the parties to address whether the House of Representatives and blue state intervenors had standing to intervene and, if not, whether that would deprive the court of jurisdiction to hear the appeal.

Last week, all of the parties filed briefs responsive to the Fifth Circuit's request. Of note, none of the parties believe the Fifth Circuit lacks jurisdiction to hear the appeal. This is almost certainly correct. Because the United States continues to enforce the ACA (as its own brief noted), there is still a case or controversy, as there was in Windsor v. United States, in which the Obama Administration refused to defend the constitutionality of the Defense of Marriage Act, but continued to enforce the law. Several of the parties questioned whether the House of Representatives had standing to intervene (and with good reason), but this does not matter for the Fifth Circuit to have jurisdiction both because the federal government is still enforcing the ACA and because (as the plaintiff states conceded), the state intervenors almost certainly have standing as well.

As a consequence of these filings, it would be quite a surprise were the Fifth Circuit to dismiss the appeal for a lack of appellate jurisdiction. Instead, the court will likely dive into evaluating Judge O'Connor's opinion and determining whether the plaintiff states and individuals had standing to bring their initial claim and whether the constitutional infirmity of the individual mandate requires invalidating other parts of the ACA. As my prior posts on this case (indexed below) indicate, I am doubtful the plaintiffs had standing and believe there is no basis in the law of severability—either as originally understood or as currently applied by the Supreme Court—for invalidating any ACA provision beyond the mandate itself.

Over the past few days, my co-blogger Randy Barnett has written several posts (all but one with Josh Blackman) expressing a slightly different view of the case. (See here, here, here, and here.) As I've already blogged on many of the issues raised in these posts, I'll here just offer a few brief comments to supplement what I've blogged before.

First, on the individual mandate itself, I am not sure who Randy and Josh are addressing. I don't think there is much debate that, under NFIB, Congress may not use its Commerce Clause and Necessary and Proper Clause powers to impose an insurance coverage mandate. Insofar as Congress wishes to induce individuals to purchase health insurance, it must use the taxing power—which it did up until 2017. As I noted in my first post on the suit, once Congress eliminate the tax penalty for failing to purchase qualifying health insurance, the mandate is "no more than a hortatory statement buried in the U.S. Code" with no legal effect.

In NFIB, Chief Justice Roberts noted that there was no consequence for failing to purchase qualifying health insurance other than the payment of a tax, and now that the tax has been eliminated, there is no consequence at all. Any suggestion that by zeroing out the tax penalty, Congress somehow resuscitated the mandate itself is absurd. Indeed, Congress lacked the power to take such a step under the reconciliation rules under which the 2017 tax reform was enacted, and it's quite clear no Republican member of Congress saw there vote as an attempt to reimpose the mandate.

It is also a bit odd to claim, simultaneously, that under NFIB "the mandate qua mandate is gone" (as Randy correctly argued in his Florida Law Review article) and that plaintiffs still have standing to challenge the mandate in federal court. If, as Randy argued there, NFIB eliminated the mandate while upholding the penalty as a tax, there is no mandate left to challenge, and certainly no judicially cognizable injury.

Finally, I am puzzled by the repeated suggestion that those critical of Judge O'Connor's ruling are motivated by their fondness of the ACA. As I've noted before, the plaintiffs' legal theory and Judge O'Connor's ruling has been roundly criticized across the political spectrum, including by conservative office-holders, prominent conservative and libertarian academics (including our co-blogger Ilya Somin), and those who have made it their life's mission to see the ACA erased in its entirety. What critics of Judge O'Connor's opinion have in common is not any love for the ACA, but a distaste for flawed and unpersuasive legal arguments.

Whereas many prominent legal thinkers on the Right expressed support for the arguments against the individual mandate in NFIB or against the lawfulness of tax credits in federal exchanges in King v. Burwell, there is a dearth of prominent voices in support of the plaintiffs' theory here. I don't think that's an accident. NFIB and King were grounded in foundational aspects of conservative legal jurisprudence (the notion of limited federal power and textualist statutory interpretation, respectively). Texas v. U.S., on the other hand, is a too-clever attempt at legal jujitsu that requires discarding traditional conservative approaches to standing, statutory interpretation and severability. This is why even those who would love to find a killer argument against the ACA have refused to embrace the plaintiffs arguments, and why I think this effort will ultimately fail, whether before the Fifth Circuit or te Supreme Court.

For more on the case, here are links to my prior writings on this case, both here at the VC and (as indicated) in the New York Times.

University of Michigan law professor Nicholas Bagley, with whom I sparred regularly over King v. Burwell, has also compiled a list of his posts on the case at The Incidental Economist.

Links to the various legal filings in this case, and to much supporting material, may be found here.


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