Fourth Circuit Appellate Court Dismisses Two Lower Court Cases Challenging PPACA’s Constitutionality: But Rulings Do Not Address the Merits of the Legal Challenges Including the Individual Mandate
On September 8th, a three-judge panel of the 4th Circuit Court of Appeals dismissed two lower court cases challenging the new federal health care reform law.
In the matter of The State of Virginia v Kathleen Sebelius, the three judge panel unanimously dismissed the challenge on the part of the State of Virginia which sought to have the provision in the Patient Protection and Affordable Care Act (PPACA) mandating the purchase of health insurance declared unconstitutional, and as PPACA lacks a severability clause, to have the entire federal law struck down.
In a 33-page opinion, the 4th Circuit Appellate Court held that the State of Virginia lacks sufficient standing to bring the action, as the mandate applies to individual residents and is not a requirement applying to the State of Virginia per se. Many observers predicted that the Appellate Court would only rule on the issue of standing as most of the oral arguments on the case involved who is potentially and directly harmed by the new federal mandates.
In the matter of Liberty University v. Geithner, the same three judge panel held by a two-to- one majority that Liberty University’s constitutional challenge was filed prematurely. Counsel on behalf of Liberty University and on behalf of two of Liberty’s employees argued that the penalties at issue were not a tax, but rather a financial enforcement mechanism for the insurance-purchase mandate. Their lawsuit contested both the financial penalty to be assessed on individuals who do not obtain health insurance by 2014, and a separate financial penalty levied on some employers whose workers got a federal subsidy in order to obtain health insurance.
In the split decision regarding the Liberty lawsuit, the 4th Circuit Appellate Court held that the PPACA’s insurance mandate, enforced with a financial penalty, is a form of federal tax, and the federal Anti-Injunction Act prohibits lawsuits seeking to block enforcement of a tax measure before it goes into effect. This ruling marked the first time that a federal appeals court has ordered an end to a constitutional challenge to the individual mandate based on the provisions of the Anti-Injunction Act. That theory was ignored by the Obama Administration’s Department of Justice when it appealed the case, but the Circuit Appellate Court majority opinion used this argument as the basis for its140-page opinion.
Both 4th Circuit Appellate Court rulings provide some positive news for the White House, but do not provide the Obama Administration with much political advantage, as the three judge panel did not rule on merits of the constitutional challenges in either case.
Furthermore, all three judges on the panel are democrat appointees. Judge Diana Gribbon Motz was nominated to the bench by President Bill Clinton. Judges Andre M. Davis and James A. Wynn Jr. were nominated to the bench by President Barrack Obama.
The 4th Circuit Appellate Court is the third federal appeals court to rule on the constitutionality of the PPACA’s individual mandate to purchase health insurance provision. The 6th and 11th Circuits were divided on the question of the law’s constitutionality. A three-judge panel of the 6th Circuit Court of Appeals in Cincinnati ruled two-to-one in favor of PPACA’s constitutionality. Then the 11th Circuit Court of Appeals in Atlanta ruled two-to-one against the constitutionality of the individual mandate.
Clearly, the 4th Circuit rulings did not break the tie between the 6th and 11th Circuits. Most legal experts predict that PPACA’s legality will be ultimately settled by the United States Supreme Court.
For recent background on previous court rulings, check the previous posts by BenefitMall:
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