Obamacare Challenge Goes Forward

In what appears to be the first judicial ruling on one of the healthcare law challenges brought by a number of states’ attorneys general, a federal court in Richmond Virginia denied a motion to dismiss the suit. While significant, this ruling only means that the case can go forward. Judge Henry E. Hudson, in a 32 page opinion, observed that while his court “may set the initial judicial course of this case, it will certainly not be the final word.”

The Commonwealth of Virginia (four states are officially styled “Commonwealth” – the others are Massachusetts, Pennsylvania, and Kentucky) in the wake of the passage of the Patient Protection and Affordable Care Act, colloquially known as “Obamacare,” enacted the Virginia Health Care Freedom Act. Section 1501 of Obamacare mandates that everyone must purchase a healthcare insurance policy providing minimum coverage as mandated by the Act. The Virginia law essentially provides that citizens of Virginia do not have to participate in this mandate. Obviously, the two statutes directly conflict. If it is within the purview of Congress under the Constitution to pass such a mandate, the supremacy clause of the Constitution provides that the federal statute would prevail. If not, then such a mandate is unconstitutional, and the Virginia law will prevail.

The suit was filed by Virginia’s attorney general. Kathleen Sibelius, the Secretary of the Department of Health and Human Services, in her official capacity, moved to dismiss the case as lacking subject matter jurisdiction and failure to state a claim upon which relief can be granted (Rule 12 (b)(1) & (6), Federal Rules Of Civil Procedure). When this kind of motion is successful, it is often reported in the media as the case “being thrown out of court.”
Subject matter jurisdiction is an arcane field in the law in almost any case, but more particularly here, so I will not go into it, except to say that a challenge to it means the court lacks the power to adjudicate a dispute because the Constitution or a statute does not provide for it. The failure to state a claim challenge, on the other hand, goes to the heart of the merits of the case.

The judge stated was that the entire case seems to boil down to the single issue of whether Congress has the power to regulate and tax a citizen’s decision not to participate in interstate commerce. The court observed that no reported case from any federal appellate court has extended the commerce clause or the tax clause of the U.S. Constitution to include the regulation of a person’s decisions not to purchase a product, notwithstanding such abstention’s effect on interstate commerce. Judge Hudson noted that there is some authority that arguably supports the theory underlying each side’s position, and accordingly he was unable to conclude that the Commonwealth of Virginia fails to state a claim. The case will go forward.

From a historical standpoint, it is of interest that Virginia, and Kentucky, during the John Adams administration, passed what are known as the Virginia and Kentucky Resolutions in 1788 and 1789. These were authored secretly by Thomas Jefferson and James Madison, and were protests against the Alien and Sedition Acts. Jefferson’s theory was that states could “nullify” acts of Congress within their borders on Constitutional grounds. The considerable unpopularity of the Federalist Congress’s draconian statutes ultimately made the state resolutions moot. This theory raised its head again in 1832 during Andrew Jackson’s administration when South Carolina invoked the doctrine against a tariff that the state considered unfair, and unconstitutional. Jackson’s firm stand, and threat to use force to collect the tariff, essentially foreclosed the nullification doctrine.

Virginia’s current attempt is not nullification in the sense that it is unilaterally declaring a federal law to be of no effect within its borders, but is a judicial challenge to law’s constitutionality. After Marbury v. Madison, decided in 1803, the courts have assumed the role of being the final arbiter of whether a statute conforms to the Constitution. They are loathe to do so, however, when doing so invalidates a statute passed by Congress and signed into law by the President. There have been few such instances since the 1930s. As a matter of fact, the Wickard v. Filburn case decided in 1942 pretty much said that Congress can do anything it wants to so long as it can show it has some effect on interstate commerce. There are some outer limits to that power. In the Virginia case, as well as cases filed by other states seeking to overturn the Congressional mandate that individuals must purchase a product, that limit will either be defined or, for all practical purposes extended to infinity. Which is why elections for Representatives and Senators may become even more important than they are now. Elections have consequences; quite often, unintended.

A copy of the court’s opinion is available on line at many websites including http://www.leagle.com/unsecure/page.htm?shortname=infdco20100802966