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Bench Memos

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Zing!



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Finally, a political cartoonist takes note of Attorney General Holder’s selective enforcement of the law:

On a different note, I wish AG Holder a speedy recovery from his hospitalization yesterday.

Thug’s Veto Prevails in Ninth Circuit



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In a ruling yesterday (in Dariano v. Morgan Hill Unified School District), a Ninth Circuit panel held that high-school officials did not violate the constitutional rights of students whom they required to remove clothing bearing images of the American flag. School officials took that action because they anticipated that clothing with images of the American flag would trigger violence from “Mexican students” (the odd term that the panel embraces to refer both “to students of Mexican origin born in the United States and students born in Mexico”) in connection with a school-sponsored Cinco de Mayo celebration.

I broadly agree with what Eugene Volokh wrote about the ruling yesterday, including that it may well be a “faithful application” of the Supreme Court’s 1969 precedent in Tinker v. Des Moines Independent Community School District. Volokh soundly observes that even if the ruling is right, “[s]omething is badly wrong” when a school “feels unable to prevent [student-on-student] attacks (by punishing the threateners and the attackers)” and instead allows a “heckler’s veto”—“thug’s veto” seems more apt—to prevail. As he puts it, “When thuggery pays, the result is more thuggery. Is that the education we want our students to be getting?”

To illustrate the unfairness of the thug’s veto, consider this: The plaintiff students brought an equal-protection claim in which they alleged that they were treated differently than students wearing the colors of the Mexican flag. Their claim failed because they “offered no evidence ‘demonstrating that students wearing the colors of the Mexican flag were targeted for violence.’” In other words, if only they (or other “Caucasian students”—again, the panel’s terms) had been as thuggish, they might have prevailed on their claim. (Alternatively, perhaps under those circumstances the school would have barred students from wearing the colors of the Mexican flag on Cinco de Mayo.)

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This Day in Liberal Judicial Activism—February 28



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2001—The Legal Services Corporation Act of 1974 created a federal subsidy program that provides financial support for legal assistance to the poor in noncriminal matters. To keep the program from being used for political purposes, Congress has tightly regulated the use of LSC funds. One funding restriction, added in 1996, withheld LSC funds from entities that took part, on either side, in litigation to reform welfare.

In Legal Services Corp. v. Velasquez, the Supreme Court, by a vote of 5 to 4, rules (in an opinion by Justice Kennedy, joined by Stevens, Souter, Ginsburg, and Breyer) that the 1996 funding restriction violates the First Amendment. Justice Scalia, in dissent (joined by Rehnquist, O’Connor, and Thomas), explains that the case is “embarrassingly simple: The LSC subsidy neither prevents anyone from speaking nor coerces anyone to change speech, and is indistinguishable in all relevant respects from the subsidy upheld in [the Court’s 1991 ruling in] Rust v. Sullivan.” 

A Divided Court in Greenhouse-Gas Cases?



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On Monday, the Supreme Court heard oral arguments (transcript here) in Chamber of Commerce v. EPA and five other consolidated cases challenging the EPA’s authority to regulate literally anything that emits carbon dioxide or other greenhouse gases. Although the argument had moments of levity, such as when Solicitor General Donald Verrilli reassured the court that the EPA would not regulate CO2 emitted by human beings, the justices appear to be divided, with no obvious majority emerging during arguments.

My colleague, Carrie Severino, discussed this case in more detail on Monday morning, so if you want an in-depth discussion, read her piece. Here’s the short version: In 2007, the Supreme Court reversed the EPA in Massachusetts v. EPA because it didn’t give a statutory reason for refusing to regulate mobile sources of greenhouse gases like carbon dioxide. After the Obama administration came to power, the EPA not only embraced regulation of mobile sources of greenhouse gases, but extended the regulation to stationary sources, thus allowing the EPA to regulate literally millions of sources not heretofore understood to be subject to regulation, and increasing the wait time for obtaining permits for such sources up to ten years. The EPA admits that its interpretation of the Clean Air Act is absurd, but instead of adopting a reasonable interpretation, it asserts the authority to rewrite specific numeric limits for air pollutants that were set by Congress in the Clean Air Act.

Although pretty much all of the interpretive problems in this case were created by the Supreme Court’s holding in Massachusetts that the Clean Air Act authorizes regulation of greenhouse gases, reversal of that decision is unlikely. The chief addressed the stare decisis issue explicitly, and Justice Kennedy was right there with him, so there would be no majority to reverse Massachusetts and let Congress address the issue through legislation.

But even starting with the premise that Massachusetts survives, there was little agreement about how to deal with the problems caused by extending it further. Chief Justice Roberts, Justice Scalia, and Justice Alito seemed to favor the petitioners’ view that the Massachusetts definition of “air pollutant” should not apply to Clean Air Act programs in which it makes no sense. (Full disclosure: We made the same point in our amicus brief.) 

Justice Breyer repeatedly argued for an inversion of that approach, insisting that the court could apply the Massachusetts definition to the other programs in the Clean Air Act but exempt carbon dioxide from the explicit statutory thresholds. This solution, however, would defy the statutory interpretation canon that the specific provision trumps the general. Justice Kagan was interested in a statutory solution, too, proposing both Chevron deference and a technical statutory construction, but none of the other justices picked up either line of questioning, suggesting that they were not widely shared.

Both Justices Sotomayor and Kagan seemed supportive of a general agency power to create non-textual exemptions if enforcement of the unambiguous Congressional directive would be impractical, even if the statute explicitly forbids such exemptions. But Justice Kagan herself pointed out the chief problem with that argument, namely, that it gives the agency “complete discretion to do whatever it wants, whenever it wants to.” Indeed.

The discretion issue received a fair bit of attention from the rest of the court, too. In a telling exchange, Chief Justice Roberts asked Verrilli to explain what intelligible principle in the Clean Air Act governed EPA’s use of its purported discretion in this case, but Verrilli’s answer was a mush of bureaucratese. Even when the liberal justices came to his rescue, Verrilli struggled to give a clear answer. The only case that Verrilli could muster as authority for his position was Morton v. Ruiz (1974), cited for the first time at oral argument. But Morton v. Ruiz dealt with executive discretion in spending Congressional appropriations, not the sort of blatant statute-rewriting that the EPA did with the thresholds for greenhouse gases in this case.

There’s no obvious majority for any of these solutions, suggesting that the result will be in the hands of Justice Kennedy. This makes the most likely outcomes either a 5-4 majority opinion for the petitioners or a limiting concurrence in a 4-1-4 split in favor of the EPA. Justice Kennedy played his cards close to the chest, but appeared ultimately unconvinced that the agency had acted lawfully. At one point, Justice Kennedy sought reassurance from Verrilli that if the government lost, the EPA would still be able to regulate greenhouse gases, later musing that he found the EPA’s position unprecedented. So even if Justice Kennedy decides to uphold the agency, it is unlikely that he will sign onto the administration’s discretion-maximalist view. I think that he will ultimately end up agreeing with the challengers, but it’s too close to call.

Watch Out Texas: Here Come the Trial Lawyers



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The Wall Street Journal has an interesting article about a Republican primary in Texas. Trial lawyers are financing several candidates for Texas Supreme Court with the intention of recapturing the court and reliving their glory days from 30–40 years ago, before tort reform made the state safe for doctors and shut off the spigot of easy money for plaintiffs’ lawyers. What’s new is that they are Republicans:

That’s because after decades of Republican domination on the Supreme Court, lawyers who typically give to Democrats have realized that backing Republicans is their best shot at winning. Democratic donor and trial lawyer John Eddie Williams, for instance, hosted a fundraiser for the three challengers last week. The primary challengers have all branded themselves as “the conservative candidate,” though Mr. Perry and the states two GOP senators, John Cornyn and Ted Cruz, have all endorsed the incumbents.

Read the whole thing here.

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This Day in Liberal Judicial Activism—February 27



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1998—In Brause v. Bureau of Vital Statistics, Anchorage trial judge Peter A. Michalski rules that Alaska’s statutory definition of marriage as between “one man and one woman” violates the state constitution unless Alaska can show a “compelling state interest” in support of its definition. In November 1998, Alaska voters approve, by a 68% to 32% margin, a state constitutional amendment defining marriage as between a man and a woman.

Supreme Court of Michigan Orders Review of State Bar Dues and Use for Ideological Activities



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For more than 20 years, state bar associations have known that they must tread carefully around constitutional restrictions against using mandatory member dues as a slush fund for ideological advocacy. Thirty-one states and the District of Columbia require membership in the bar as a precondition to practicing law, and the Supreme Court has said that such compulsory dues may only be used for two purposes: (1) the regulation of the legal profession; and (2) improving the quality of legal services. After all, if a state can force people to pay for the privilege of doing business in the state, then use the dues for whatever political activities suit its fancy, the state is unconstitutionally forcing people to advocate for causes that they disagree with.

Despite these restrictions, political forces (attracted by access to member dues and the state bar’s appearance of neutrality) sometimes capture the state bar and take a flying leap into ideological activity. In Michigan, for instance, the state bar recently began to use compulsory dues to promote regulations stifling speech in judicial elections, a favorite cause of some on the left. Because many Michigan attorneys object to this sort of political activity, however, several Michigan legislators introduced a bill that would turn state bar membership into the voluntary association that exists in 19 other states. At this point, with its access to member dues under mortal threat, the state bar persuaded the Supreme Court of Michigan to create a task force to review the activities of the Michigan state bar for constitutionally impermissible activities.

The Supreme Court of Michigan should be lauded for ordering review of these activities. But the task force is stacked with current and former state bar officials, making this whole exercise a bit like asking the fox to do a security audit of the hen house. One wonders why the state bar couldn’t be trusted to simply stop the unconstitutional ideological activities by itself.

Of course, Michigan is only one of many states where lawyers engage in this sort of self-dealing. The state bars of Missouri and Oklahoma, both of which require compulsory dues, fight hard to retain their strangleholds on judicial selection. Missouri uses part of its $10 million annual budget (obtained mostly from compulsory bar dues) to promote its continued control of state judicial selection in major bar publications and on its website, and Oklahoma state bar officials have vigorously opposed reform of Oklahoma’s lawyer-controlled judicial-selection process.

In any event, Michigan’s task force will have plenty to review.  A quick search of Michigan lobbying disclosure reports indicates that over the last several years, the Michigan State Bar has spent hundreds of thousands of dollars in spending on state-level lobbying. In addition to lobbying in its own name, the $87,000 spent on lobbying in 2013 was spread out over several different “Sections” of the State Bar, such as the Negligence Law Section, Real Property Law Section, and so forth. And projects listed on the Michigan Bar’s website, like the Justice Initiatives Committee and the Diversity and Inclusion Advisory Committee, need to be thoroughly examined to ensure that they are not simply using member dues for left-wing social causes. It will be interesting to follow the task force’s work, and I hope it results in reform for the lawyers who are tired of being forced to subsidize political activity they disagree with.

Welcome Jonathan Keim to Bench Memos



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Please join me in welcoming my colleague, Jonathan Keim, to Bench Memos. He recently joined the Judicial Crisis Network as Counsel. Jonathan previously served as a judicial clerk in the Eastern District of Virginia and as a cyber-crime prosecutor with the U.S. Attorney’s Office for the Eastern District of Virginia. He will be specializing in judicial nominations and constitutional litigation. 

Where Do Our Religious Freedom Principles Come From?



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Everywhere we turn these days, we are confronted with issues of religious liberty.  Can employers be compelled to include contraceptives and abortifacients in their employee health plans, if their faith teaches it’s wrong?  Can a photographer be fined for refusing, because of her faith, to photograph a same-sex union ceremony?  Can a town council continue its traditional practice of having local clergy give an invocation before each council meeting?  Is it unlawful for the government to tolerate the presence of a volunteer-maintained memorial cross honoring veterans on public land?  Can the government dictate the “ministerial” hiring practices of churches and religious schools?  Can a bureaucrat at a federal veterans’ cemetery tell local volunteers not to offer to pray with the bereaved who come for their loved ones’ funerals?  Can the military, in the name of “tolerance,” muzzle its chaplains’ preaching of their faith?  Can a state legislature take steps to protect the age-old definition of marriage, or even just the freedom of its citizens to act on a religious belief in that definition, without a judge somewhere striking down the legislation for violating the “separation of church and state”?

America has perhaps the strongest legal principles in the world protecting religious freedom—which is not to say that those principles are always happily realized, nor that they sprang into being at some magical moment of perfection.  But the foundations of our religious-freedom law were put in place after years of struggle in colonial and revolutionary America over the relationship between church and state, religion and politics.  Understanding these foundations is indispensable to a full understanding of where we are today.

To that end, this summer the Witherspoon Institute, where I direct the Simon Center on Religion and the Constitution, will hold a Church and State Seminar: Religion and Liberty in the American Founding Era.  As in past years, we will bring together young scholars—untenured professors, postdoctoral scholars, and dissertation-writing doctoral students—to discuss primary sources from the founding era on the origins of the American understanding of church-state relations and religious freedom.  If you are one of these scholars, in history, political science, law, theology, or religious studies, or any related field, you can apply to attend the seminar by April 15 and we will give you a fast decision on your application.  A modest registration fee if you are accepted, and responsibility for your own travel to Princeton, will be your only significant expenses; we provide food and lodging for the week of July 27 to August 2.  The application is easy—a brief form, a cover letter, and a CV.

The seminar’s main text is the copious anthology The Sacred Rights of Conscience, published by Liberty Fund.  Other readings will be supplied electronically.  The seminar’s faculty are leading scholars of American religious freedom: Daniel Dreisbach, constitutional scholar at American University and co-editor of the main text; Thomas S. Kidd, historian of American religion at Baylor University; and Gerald R. McDermott, theologian and scholar of religious history at Roanoke College.  With discussion leaders like these, we look forward to a richly rewarding seminar.  If this is up your street, please apply!

Re: “Egregious” Distortions of Arizona Bill



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In addition to the letter from religious-liberty scholars, Ilya Shapiro of Cato has weighed in to explain that “SB 1062 does nothing more than align state law with the federal Religious Freedom Restoration Act.”

Shapiro, who says he’s “for marriage equality” (so am I, by the way, but he and I evidently have very different understandings of what marriage is), acknowledges that the legislation would give wedding photographers and bakers (some) protection against being required to provide their services for same-sex ceremonies, but poses the elementary question, “Why should these people be forced to engage in activity that violates their religious beliefs?”

He continues:

For that matter, gay photographers and bakers shouldn’t be forced to work religious celebrations, Jews shouldn’t be forced to work Nazi rallies, and environmentalists shouldn’t be forced to work job fairs in logging communities. This isn’t the Jim Crow South; there are plenty of wedding photographers – over 100 in Albuquerque – and bakeries who would be willing to do business regardless of sexual orientation, and no state is enforcing segregation laws. I bet plenty of Arizona businesses would and do see more customers if they advertised that they welcomed the LGBT community.

At the end of the day, that’s what this is about: tolerance and respect for other people’s beliefs. While governments have the duty to treat everyone equally under the law, private individuals should be able to make their own decisions on whom to do business with and how – on religious or any other grounds. Those who disagree can take their custom elsewhere and encourage others to do the same. 

For what it’s worth, I think that the libertarian case for a broad scaling back of antidiscrimination laws—yes, possibly including a wholesale repeal of protections for religious persons against being discriminated against on religious grounds—is compelling.  

Religious-Liberty Scholars Counter “Egregious” Distortions of Arizona Bill



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There has been a blizzard of hysterical misinformation about Arizona’s SB 1062. As anyone who takes the trouble to consult the text of the legislation will readily discover, SB 1062 does not mention, much less single out, gays or same-sex ceremonies.

As Douglas Laycock (who supports redefining marriage to include same-sex couples) and other leading religious-liberty scholars explain in a letter to Arizona governor Jan Brewer, SB 1062 “has been egregiously misrepresented by many of its critics.” What the legislation would do is amend Arizona’s Religious Freedom Restoration Act “to address two ambiguities that have been the subject of litigation under other RFRAs”:

It would provide that people are covered when state or local government requires them to violate their religion in the conduct of their business, and it would provide that people are covered when sued by a private citizen invoking state or local law to demand that they violate their religion.

But nothing in the amendment would say who wins in either of these cases. The person invoking RFRA would still have to prove that he had a sincere religious belief and that state or local government was imposing a substantial burden on his exercise of that religious belief. And the government, or the person on the other side of the lawsuit, could still show that compliance with the law was necessary to serve a compelling government interest. As a business gets bigger and more impersonal, courts will become more skeptical about claims of substantial burden on the owner’s exercise of religion. And as a business gets bigger, the government’s claim of compelling interest will become stronger.…

So, to be clear: SB1062 does not say that businesses can discriminate for religious reasons. It says that business people can assert a claim or defense under RFRA, in any kind of case (discrimination cases are not even mentioned, although they would be included), that they have the burden of proving a substantial burden on a sincere religious practice, that the government or the person suing them has the burden of proof on compelling government interest, and that the state courts in Arizona make the final decision.

Holder Encourages Dereliction of Duty by State AGs



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In the last several weeks, Ed and I have noted state attorneys general who abandoned the most basic duty of an AG: to zealously defend the laws of their state. (Ed even wrote an article about it.) Worse still, these AGs decided to break their oaths of office by refusing to defend marriage-definition laws with which they disagree.

We can now add another AG to the list: Eric Holder. AG Holder may not be a state attorney general, but he definitely has opinions about how the state AGs should do their job. In an interview yesterday with the New York Times, he declared that state AGs are not obligated to defend laws that they disagree with, and indeed, are obligated to apply what the New York Times called the “highest level of scrutiny” in a decision to defend the law. And this even starting with the assumption that the law is valid.

Holder has it exactly backwards. The AG’s proper role is to defend the laws of the state because he is a lawyer representing the state. It is for courts to subject the law to scrutiny, reserving the “highest level of scrutiny” for those that implicate core constitutional rights. Only if an attorney general can find no non-frivolous legal argument in favor of the law may he decline to defend it. Apparently Holder would prefer that state AGs play philosopher-king (much as the president has done) by simply declining to enforce valid laws without ever giving a court the chance to actually decide whether it is valid.  

But we live in a nation of laws, not a nation of lawyers. In our constitutional system the laws were passed by Congress and the president has that one chance to use his veto power. States work the same way, with laws being enacted by the democratically elected legislatures or even by popular referendum. Once a law is duly enacted it cannot be unilaterally repealed by one government official, even if they have the blessing of the U.S. attorney general. 

Of course, it’s no surprise that this inducement to lawlessness comes from an administration that seems to view the Constitution and the laws merely as obstacles to their grand plan. From their perspective, refusing to uphold the law is just another day at the office.

AG Holder Flunks Legal Ethics 101



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In comments to the New York Times yesterday and in a speech to state attorney generals today, Attorney General Eric Holder invited state attorneys general to refuse to defend state marriage laws. (The Times article asserts that Holder “was careful not to encourage his state counterparts to disavow their own laws,” but I don’t see how his comments can be understood as anything but encouraging them to do so.)

I spelled out in my recent Weekly Standard essay how state attorneys general have an obligation to defend state marriage laws. It’s unfortunate that Holder doesn’t understand the basics, but it’s hardly surprising: Holder, after all, departed from DOJ’s longstanding practices when he refused to defend DOMA, and he has routinely indulged his political preferences at the expense of the rule of law.

I’m pleased to see that the Republican Attorneys General Association has issued a statement that forcefully takes issue with Holder. Nothing yet, apparently, from the counterpart Democratic association or from the ABA.

Here is the RAGA press release (which I received by e-mail):

Washington, D.C. (February 25, 2014) –  The Republican Attorneys General Association (RAGA) issued the following statement today in response to U.S. Attorney General Eric Holder’s claim that state attorneys general do not have to defend their states’ ban on same-sex marriage.

“A state attorney general has a solemn duty to the state and its people to defend state laws and constitutional provisions against challenge under federal law. To refuse to do so because of personal policy preferences or political pressure erodes the rule of law on which all of our freedoms are founded. A government that does not enforce the law equally will lead our society to disrespect the rule of law,” said Luther Strange, Alabama Attorney General.

RAGA Chairman Alan Wilson, South Carolina Attorney General, added, “This administration is repeatedly ignoring the rule of law. We’re seeing the same thing happen with Obamacare as the Obama administration continues to pick and choose which parts of the law they will enforce and which they will delay without legislative action. Our freedom depends on upholding the rule of law and obtaining the consent of the governed. Republican Attorneys General will continue to fight every single day to protect our Constitution and defend states’ rights.”

“What General Holder is asking state Attorneys General to do – is accept a gratuitously offered non-binding legal opinion on an issue that has not been decided by a national court of competent jurisdiction at this time. The approach is as inappropriate, as it is unprecedented, ” said Tim Fox, Montana Attorney General.

Semi-Retired Justices Behaving Injudiciously



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Law professor Josh Blackman properly faults semi-retired Supreme Court justice John Paul Stevens for writing a new book that (according to its publisher) “offers a manifesto on how the Constitution needs to change” and proposes six specific amendments. As Blackman points out, Stevens retired only from active service and thus remains an Article III judge, and he therefore remains subject to the same “norms of propriety” as any other justice. Does anyone think it would be proper for other justices to be writing books that advocate constitutional amendments?

Somewhat relatedly, I’ve previously addressed Stevens’s conduct after leaving active service, and I’ve written quite a bit on former Justice Sandra Day O’Connor, who, rightly or wrongly, maintains that she took senior status (rather than full retirement) but who has engaged in crass politicking on state judicial-selection methods and in other fishy and inappropriate activity.

This Day in Liberal Judicial Activism—February 25



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1992—Justice Thomas’s dissenting opinion in Hudson v. McMillian—four months into his service on the Court—produces a spasm of confused outrage from the Left. As Thomas explains in the opening of his dissent, the sole issue before the Court is a legal one: Must a prisoner alleging that he has suffered “cruel and unusual punishment” establish that he has suffered a significant injury? The court below had found the prisoner’s injuries to be “minor,” and that factual determination was not under review by the Court. Addressing the legal question, Thomas reads the Court’s precedents as requiring showing of a significant injury, and he abides by that view. He also declares: “Abusive behavior by prison guards is deplorable conduct that properly evokes outrage and contempt. But that does not mean that it is invariably unconstitutional. The Eighth Amendment is not, and should not be turned into, a National Code of Prison Regulation.” Thomas further notes that the prisoner had state-law remedies available and, if those remedies were not adequate, a federal due-process claim.

The next day, this hitherto obscure case is featured in the lead article on the front page of the New York Times. Linda Greenhouse’s article highlights the injuries suffered by the prisoner, but fails to mention that the lower court’s finding that the injuries were minor was not under review by the Court. She also quotes extravagant language from Justice O’Connor’s majority opinion that, responding to Thomas’s position that the same legal standard should govern both excessive-force and conditions-of-confinement claims under the Eighth Amendment, falsely implies that Thomas denies the factual “difference between punching a prisoner in the face and serving him unappetizing food.” Greenhouse juxtaposes Thomas’s dissent with his confirmation testimony about his compassion. She also highlights a supposed “close alliance” between Thomas and Scalia.

One day later, a New York Times editorial, viciously titled “The Youngest, Cruelest Justice,” falsely asserts that Thomas’s dissent “contended that since the prisoner suffered only a split lip, loosened teeth, and a broken dental plate, he had no constitutional complaint.” The editorial feigns “crashing disappointment” with him. Happily, unlike others subjected to the gaseous pollutants of the Greenhouse effect, Thomas remains unaffected.

On the HHS Mandate’s “Sieve” of Exceptions



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On the Balkinization blog, law professor Marty Lederman has been writing a series of long posts defending the HHS mandate against the religious-liberty challenges brought by Hobby Lobby, Conestoga Wood, and others.

(Lederman provides a compendium of his posts at the end of his most recent post. I’ve previously explained—here and in a two-part reply to Lederman’s response—why I think that Lederman is wrong to contend that the absence of a legal duty on large employers to provide health insurance means that the HHS mandate doesn’t impose a substantial burden.)

As part of their argument that the burden that the HHS mandate imposes on them isn’t “in furtherance of a compelling governmental interest,” Hobby Lobby and Conestoga Wood cite the mandate’s “sieve” of exceptions—for example, for “grandfathered” plans (which are not subject to the HHS mandate at all) and for small employers (who face no penalty for failing to provide employee health coverage). (See Hobby Lobby brief at 49-52; Conestoga Wood brief at 58-60.) As Hobby Lobby puts it, “These numerous exceptions belie the government’s claim that the mandate is strictly necessary to further compelling interests in public health, gender equality, or anything else.” (Hobby Lobby brief at 51.)

In a post titled “The Myth of Underinclusiveness,” Lederman argues that “the statute here is not nearly as full of ‘holes’ as the plaintiffs would have it.” I will outline here why I think Lederman is wrong:

1. Let’s start with the “small employer” exception. Lederman observes (correctly) that employees of small employers who decline to provide qualifying health coverage “will be eligible for coverage on a government-subsidized exchange.” That means, he contends, that such employees “will be entitled to the full range of required, cost-free preventive services coverage.” (The term “cost-free” means without requiring insured persons to make copayments or pay deductibles.)

What Lederman is overlooking (or glossing over) is that such employees will be “entitled” to the “cost-free” contraceptive coverage that the HHS mandate requires of large-employer plans only if those employees actually make the decision to purchase coverage on an exchange. Under the saving construction of the individual mandate that the Supreme Court majority adopted in NFIB v. Sebelius, no one is under a legal duty to purchase such coverage. Further, it’s clear from the early experience with the exchanges that lots of individuals have decided to go without insurance rather than to purchase coverage on an exchange.

In short, the “small employer” exception from the employer-mandate penalty gives small employers a disincentive (vis-à-vis large employers) to provide health coverage for their employees. The predictable result is that many of those employees will not obtain coverage on the exchanges and thus will not obtain the cost-free contraceptive coverage that the Obama administration contends it has a compelling interest in requiring Hobby Lobby and Conestoga Wood to provide.

2. As for “grandfathered” plans: Lederman thinks it significant that the “percentage of employees in grandfathered plans is declining rapidly” and was down to “36% in 2013.” Looking into his crystal ball, he contends that at some undefined point “[i]n the not-so-distant future, the number of remaining grandfathered plans should be vanishingly small.”

I fail to see how a blanket exception that, as of the most recent data, covers a full 36% of all employees can be disregarded on the basis that it is supposedly transitional. (Never mind, as Conestoga Wood points out, that “grandfathered” status can continue indefinitely.) If the federal government doesn’t have a compelling interest in requiring that the tens of millions of employees (and their dependents) under grandfathered plans obtain cost-free contraceptive coverage, why does it have a compelling interest in requiring Hobby Lobby and Conestoga Wood to provide it to its employees?

3. Consider also the “accommodation” that the Obama administration has provided for objecting religious nonprofits. Lederman argues that the “government’s interests are not compromised in such cases,” since the accommodation ensures that employees of the religious nonprofits obtain the cost-free contraception coverage. But RFRA requires that the government demonstrate that “application of the burden to the person … is in furtherance of a compelling governmental interest.” If, as the Obama administration maintains, the accommodation respects the religious-liberty interests of the religious nonprofits, the question arises why the Obama administration does not provide that same accommodation to objecting for-profit employers.

4. Lederman fails to recognize that the arguments that he (wrongly) thinks so central to the substantial-burden inquiry—that large employers don’t actually have a legal duty to provide employee health insurance at all and that “most employers” would (supposedly) benefit economically by dropping their health plans and instead paying the tax—undercut his position on exceptions. To the extent that Lederman is right on the latter proposition, the employees of large employers will lose their employer-provided insurance and will be stuck with the choice of obtaining insurance on the exchanges or of going without insurance. Again (as with the small-employer exception), it’s predictable that some significant number of employees will choose the latter option and thus won’t obtain cost-free contraceptive coverage. So how is it that there is a compelling interest in requiring Hobby Lobby and Conestoga Wood to provide such coverage?

5. The Obama administration (acting with no legal basis) has already waived the employer-mandate penalty for large employers for 2014 and for a newly invented category of mid-sized employers through 2015. (The waiver doesn’t help Hobby Lobby and Conestoga Wood, as they remain subject to steeper penalties for providing non-compliant coverage.) Again, these waivers provide a disincentive to employers to provide coverage to their employees and thus operate to increase the number of individuals who will decide between obtaining insurance on the exchanges or going without insurance.

6. Lederman makes this blanket assertion:

If the [Hobby Lobby and Conestoga Wood] plaintiffs were to receive the relief they seek, it would mean that their female employees would have to pay for such contraception themselves—and thus they would not enjoy a virtually universal new health care benefit that will be available to more than 99% of other women in the United States.

As ought to be clear by now, his assertion that the benefit “will be available to more than 99% of other women” obscures two key limitations. First, by using the future tense (“will be available”), Lederman is referring to some time in the future when there will be few if any grandfathered plans. That is not the context in which the HHS mandate was imposed, and it is not the context now. Second, the proposition that the benefit “will be available” is very different from the proposition that most or all women who are deprived of employer-provided insurance will actually choose to avail themselves of insurance on the exchanges that includes the benefit. (Also, contrary to what Lederman implies, the employees of Hobby Lobby and Conestoga Wood could also obtain coverage on the exchanges, though I readily acknowledge that for them (as for many others) the economic case to do so might well be irrational.)

Further, the government could develop alternative means of providing cost-free contraception or contraceptive coverage to the employees of employers who have religious objections to some or all of the drugs and devices covered by the HHS mandate. (See Hobby Lobby brief at 58.)

Tuesday Book Event in D.C. for Fifth Circuit Judge Leslie Southwick



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Just a reminder: Tomorrow (Tuesday) evening, February 25, Fifth Circuit judge Leslie M. Southwick will discuss his new book The Nominee: A Political and Spiritual Journey at an event jointly sponsored by the Ethics and Public Policy Center and the Catholic Information Center. I’ll have the privilege of introducing Judge Southwick.

See here for more information or to RSVP. (Last-minute drop-ins are welcome—especially if you buy the book.)

Halbig v. Sebelius, Part 3: The Whole Act Canon and the Constitution



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In the third and final post of my three-post series about Halbig v. Sebelius (see Part 1 and Part 2) a lawsuit challenging unlawful Obamacare tax regulations promulgated by the IRS, I’ll summarize our amicus brief, which we recently filed on behalf of several members of Congress.

As I noted in my first post, the starting point for the interpretive task is the text of the Affordable Care Act itself, and the text creating the tax subsidy for exchange-bought health plans is unambiguous and perfectly clear: It applies to exchanges “established by the State under [Section] 1311 of the Patient Protection and Affordable Care Act.” In my second post, I explained the government’s argument and the district court’s opinion, which simply got it wrong.

Now, much federal legislation is imperfect, as anyone familiar with reading statutes will tell you. As a general rule, the Supreme Court has held that the interpretation of imperfect legislation requires a holistic view of the statute at issue. Nevertheless, under well-established principles of statutory interpretation, the text still governs unless the plain language would lead to absurd consequences.

The district court erroneously accepted the government’s argument that restricting the tax subsidy to exchanges established by a state (as the statute says) would lead to absurdity. In fact, there is ample evidence that Congress wanted to create incentives for states to create their own exchanges, since the Constitution forbids Congress from forcing the states to do so on their own. Incentives are clearly not an “absurd” result.

And this raises another important issue: At the government’s urging, the district court tried to create a textually harmonious interpretation of the ACA, that is, one that avoided all possible anomalies. But this approach is at odds with the typical principle that, in large, convoluted statutes such as the ACA, Congress often means different things when using the same words (we cite several examples in our brief). The district court’s opinion assumes a level of harmony in the statute that nobody who has ever read a large piece of legislation like the ACA should expect it to have.

Moreover, as we note in our brief, the language at issue originated with a Senate bill that was largely trying to strip the ACA of federal involvement. The bill passed the Senate and went to the House, but before the House and the Senate could agree on amendments that would pass both houses, Senator Scott Brown replaced Senator Ted Kennedy, altering the political balance. The bill that Congress passed under these circumstances reflects this balance of power.

These factors make adherence to the plain statutory language that much more important, lest the courts amend the ACA by substituting their own policy judgment for that of Congress. The Constitution, after all, vests the lawmaking power with Congress, not the courts or the IRS. By adopting the IRS’s general explanation of how the scheme should work, the district court effectively amended the ACA by giving the pro-federalization political forces a victory that they did not achieve through the political process.

We also raise the point that if the court concludes that the statute doesn’t mean what it says, then it would be, frankly, bizarre for the district court to conclude that the provision is unambiguous. Indeed, if the best interpretation of “established by the State under section 1311” is that it refers to exchanges established by the federal government under section 1321 of the law, then the better course is to declare the provision ambiguous and allow for a differing interpretation in the next administration.

That concludes the series on Halbig v. Sebelius. We will continue to follow this important case and note further developments. As the English say, watch this space.

Today’s Argument in Chamber of Commerce v. EPA



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This morning, the Supreme Court will hold oral arguments in Chamber of Commerce v. EPA, which is yet another case of an agency interpreting its authority so aggressively as to abandon the actual language passed by Congress. In this case, the Environmental Protection Agency attempted to effectively alter the language of the Clean Air Act in order to accommodate its regulation of greenhouse gases (like carbon dioxide) as pollutants.

After the Supreme Court held in Massachusetts v. EPA (2007) that EPA had to conduct rulemaking regarding the regulation of greenhouse gases issued by motor vehicles, the EPA issued regulations interpreting Massachusetts to extend this requirement to other sections of the statute. In particular, the EPA applied the definition of greenhouse gases from mobile sources to sections of the act dealing with different types of stationary sources. Those sections have numerical pollution thresholds written into the law itself, which become problematic if applied to greenhouse gases like carbon dioxide that differ from traditional pollutants because they are necessarily present in huge quantities in the normal air we breathe.  

Applying EPA’s suggested interpretation with these numerical thresholds would expand the covered sources of carbon dioxide by orders of magnitude: from tens of thousands of sources to millions of sources and from covering things like major power plants and steel mills to implicating small businesses and private homes. As a result, EPA estimated that extending the law’s reach to such a degree could create delays of up to ten years in issuing permits. This, EPA recognized, would be an absurd reading of the statute.

But instead of avoiding the absurdity by choosing a reasonable interpretation — by taking the inability to work CO2 into the statutory framework as evidence that Congress didn’t intend it to be covered — EPA blamed the Supreme Court’s decision in Massachusetts v. EPA, claiming that it had no choice in the matter. In its effort to scapegoat Justice Stevens, who wrote the majority opinion in Massachusetts v. EPA, the agency reads the case as aggressively as it does the statute. As our amicus brief argues, the EPA’s aggressive reading of Massachusetts relies on dicta taken out of context, whereas the holding only required EPA to conduct a rulemaking that is grounded in the statute.

It would be bad enough if the EPA had just left us with its absurd interpretation and let the natural consequences of its hyperregulation play out. Instead, the EPA decided to rewrite the statute by changing the very numbers in its text. Not only does the Constitution forbid agencies from amending statutes like this, ad hoc amendments also create crippling uncertainty in the law. After all, if the EPA has the authority to alter the statute in this way, there is nothing to stop it from changing the thresholds again sometime in the future.

This discretion-maximizing approach to government is becoming the modus operandi of the current administration, most notably played out in the context of Obamacare, where government agencies have flatly refused to enforce the law.

Monday’s argument will be important for the continued viability of the Constitution’s separation of powers. The Court should put a stop to this administration’s thirst for unlimited discretion and the asserted power to ignore the law. If you’d like to learn more about this case, you can read our amicus brief here

Columbus Event on HHS Mandate Litigation



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Next Thursday, February 27, I’ll be in Columbus to discuss the HHS mandate litigation at an event organized by the Columbus lawyers chapter of the Federalist Society. I’ll be discussing the religious-liberty challenges brought by for-profit entities and their owners, and Matthew A. Kairis of Jones Day, who represents various religious non-profits (including the University of Notre Dame), will be discussing their challenges. I will then invite Matthew to join me in a private meeting of the Richard Posner Fan Club

The event takes place at noon at the Athletic Club of Columbus and includes lunch. (Price is $20 for members of the public, $15 for chapter members, and $5 for students.) To RSVP, or to obtain further information, write to [email protected]

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