This morning, the NYT reported that the Obama Administration is preparing to make several more nominations to the U.S. Court of Appeals for the D.C. Circuit.  After last week’s unanimous confirmation of Principal Deputy Solicitor General Sri Srinivasan, there are three remaining vacancies on the eleven-seat court.  The NYT identified three D.C. lawyers under active consideration by the White House: law professor Cornelia “Nina” Pillard and attorneys David Frederick and Patricia Ann Millett.  A later report by BLT adds a fourth name to the mix: U.S. District Court Judge Robert Wilkins. 

The NYT story repeated the White House talking points that additional judges are needed on the D.C. Circuit lacks “balance” and has been “undermining the president’s hard-fought legislative and executive agenda,” noting a handful of high-profile cases in which the Administration was rebuffed by the D.C. Circuit.  Yet the D.C. Circuit is as if not more ”balanced” today  than it has been in years.  The full-time active judges are now split 4-4.  While most of the senior judges still hearing cases are Republicans, that was also true in 2006, when the among active judges was 7-3 favoring GOP-nominated judges.  Yes, the D.C. Circuit has struck down some Obama Administration rules, but this is par for the course.  Some doozies, like the Administration’s greenhouse gas rules, have also gotten through.  Indeed, the Bush Administration EPA had a slightly harder time in the D.C. Circuit than has the Obama EPA, and despite its alleged anti-regualtory bias, environmentalist challenges have been more successful than those filed by industry.  Nonetheless, the NYT credulously repeats Administration talking points that additional judges are needed on the court to “make it more conceivable that the president’s agenda would get a fair hearing.”

On Saturday, Texas governor Rick Perry vetoed S.B. 346, legislation that would have forced certain nonprofit groups to disclose their financial supporters. As I’ve previously written, this unconstitutional legislation would have made it easier to target conservatives, which already happens in similar contexts. This particular legislation was apparently designed to make life difficult for those who support Michael Quinn Sullivan, a conservative activist who has been a thorn in the side of the Texas Republican establishment.

Governor Perry deserves a big, Texas-sized thank you for vetoing the legislation despite significant pressure from within his own party. Here is the text of his veto message:

“Freedom of association and freedom of speech are two of our most important rights enshrined in the Constitution. My fear is that SB 346 would have a chilling effect on both of those rights in our democratic political process. While regulation is necessary in the administration of Texas political finance laws, no regulation is tolerable that puts anyone’s participation at risk or that can be used by any government, organization or individual to intimidate those who choose to participate in our process through financial means.”

“At a time when our federal government is assaulting the rights of Americans by using the tools of government to squelch dissent it is unconscionable to expose more Texans to the risk of such harassment, regardless of political, organizational or party affiliation. I therefore veto SB 346.”

The bill’s sponsor, Republican state senator Kel Seliger, does not expect a veto override. 

The New York Times has a front-page, above-the-fold article today titled ”Affirmative Action Ruling Near, Blacks’ Progress Remains Slow.” As the title suggests, the message of the story is: It would be very bad if the Supreme Court were to rule in Fisher v. University of Texas against the use of racial preferences in student admissions, because African Americans remain underrepresented in many professional occupations (dentists, physicians, architects, lawyers) and among corporate executives.

This is a dubious theme for several reasons. First, the only legal justification for racial preferences in university admissions is the purported ”educational benefits” of a “diverse” student body; correcting society-wide racial disparities is not a justification the Court has ever accepted or been urged to accept in the Fisher case. Second, the article ignores the mismatch effect, the result of which is that racial preferences actually diminish the number of African American graduates in, especially, particular professions and the more rigorous disciplines, as well as their likelihood for success in them. Richard Sander, the coauthor with Stuart Taylor of the influential book Mismatch, has also devoted a law-review article to the problem at law firms in particular — which happen to be the focus of the Times article; alas it does not mention Professor Sander’s research. (One of the many bad side effects of racial preferences is the way their use stigmatizes all members of the group that receives the preference; the Times story quotes a young black lawyer complaining it was commonly assumed he “was not as qualified as white colleagues” — an assumption that is directly attributable to the use of racial preferences that the Times nonetheless supports.) Third, any serious discussion of racial disparities in 2013 must acknowledge the fact that more than seven out of ten African Americans now are born out of wedlock, with predictable and sad results in education, economics, crime — you name it. The Times story makes no mention of it.

Two other errors: The Times story suggests that the various state ballot initiatives banning racial preferences apply to the private sector (they don’t) and implies that the “diversity” justification the courts have accepted for student admissions is also available in private-sector employment (it isn’t).

The Supreme Court today issued two 5-4 rulings in cases involving federal habeas petitions. In both cases, the five-justice majority consisted of Justice Kennedy and the four lockstep liberals.

In McQuiggin v. Perkins, the Court, in an opinion by Justice Ginsburg, created an “actual innocence” exception to the statute of limitations on federal habeas petitions set forth in the Antiterrorism and Effective Death Penalty Act of 1996 (AEDPA). Never mind, as Justice Scalia points out in his dissent, that AEDPA provides its own actual-innocence exception (one that the petitioner failed to satisfy). Scalia’s lead item in what he calls the Court’s “statutory-construction blooper reel” is the Court’s “flagrant breach of the separation of power” in concocting an exception to AEDPA’s “clear statutory command.” (As Scalia explains, in the Court’s previous rulings “actual innocence” had “been an exception only to judge-made, prudential barriers to habeas relief, or as a means of channeling judges’ statutorily conferred discretion not to apply a procedural bar.”)

A sidenote: Conservative supporters of Justice Kagan’s nomination asserted that she would be sound on statutory construction. The evidence isn’t backing them up.

In Trevino v. Thaler, the Court, in an opinion by Justice Breyer, significantly broadened a purportedly “narrow exception” that it had created just last year, in Martinez v. Ryan, to the general rule that a state prisoner who has failed to exhaust state remedies or has failed to comply with the state’s procedural requirements is not entitled to federal habeas relief unless he can show cause to excuse his default. (I’ll leave the details to the interested reader to discover.)

As Chief Justice Roberts (joined by Justice Alito) complains in his dissent, the Court in last year’s Martinez ruling (which they both joined) had been “unusually explicit about the narrowness of [its] decision” and had included “aggressively limiting language.” But today it “throws over the crisp limit [it] made so explicit just last Term” and instead adopts an “opaque and malleable” standard that will lead to “years of procedural wrangling [that] undermine the finality of sentences necessary to effective criminal justice.”

Justice Scalia’s brief dissent (joined by Justice Thomas) points out that he observed in his Martinez dissent that the Court’s “line lacks any principled basis, and will not last.” Scalia’s prophecies have often proved true, but it usually takes more than a year.

The lesson, which ought to be old news, is: Don’t be fooled by the liberal justices’ unprincipled and ad hoc limitations on their rulings. Those limitations will disappear at the first convenient opportunity.  

In a characteristically cogent essay at Public Discourse today, Carson Holloway explains why the “compromise” on open homosexuality in the Boy Scouts of America is doomed–and pretty rapidly too.  Echoing comments our own Ed Whelan has made, Holloway points out that legally as well as morally and politically, the Scouts’ new policy is incoherent:

[T]he Scouts have, by compromising with their adversaries and thereby compromising the coherence of their own position, opened themselves to lawsuits forcing them to admit openly homosexual Scout leaders as well as members. Some states have laws that forbid discrimination based on sexual orientation. The Scouts’ traditional policy runs afoul of such laws and was in fact challenged as a violation of New Jersey’s anti-discrimination laws in the latter part of the 1990s.

At that time, the Scouts prevailed against this challenge by claiming that this attempted application of state anti-discrimination law intruded on the organization’s First Amendment rights. In Boy Scouts v. Dale, the Supreme Court agreed. The First Amendment protection for freedom of speech, the Court ruled, includes an implied protection for freedom of “expressive association.” This freedom limits the extent to which the law can force members into an organization contrary to that organization’s own convictions. Thus the Scouts could ban openly gay members because they were organized in part to inculcate a moral teaching with which homosexual activity was inconsistent.

The plausibility of this constitutional defense of its membership requirements, however, depends on the very consistency that the Scouts have now abandoned. . . .

Read the rest here.

In yesterday’s Washington Times, Joel Alicea, who will graduate any day now from Harvard Law School, comments on the deadening effect of left-wing orthodoxy in America’s law schools.  Yes, there is a problem for conservative students at most schools, who must endure being marginalized and even demonized rather than given a fair hearing.  But even liberal students do not benefit from the lockstep liberalism of most law-school faculties:

It is the predominantly liberal student body at elite law schools that is most harmed by the dearth of conservative voices. Many of these students graduate from law school without having encountered a cogent articulation of conservative views in the classroom, without having had their own ideas subjected to rigorous examination and debate.

As a result, these liberal students do not truly know why they hold the beliefs that they do, and they have little understanding of what a great proportion of their fellow citizens believe. For a group of students aspiring to be our nation’s leaders, that is serious indeed, and for a country likely to be led by such students, it presents an important problem.

Read the whole thing here.

1963— Retired justice Felix Frankfurter, having witnessed the appointment of his replacement, Arthur Goldberg, create a majority bloc of liberal activists on the Supreme Court, writes to Justice Harlan to lament “the atmosphere of disregard for law and to a large extent of the legal profession that now dominates the present Court and the Court on which I sat.” (Source: Seth Stern & Stephen Wermiel, Justice Brennan.) Decades later, the situation will be transformed—but, alas, for the worse—as “a large extent of the legal profession,” having been indoctrinated by the disciples of the Warren Court, will display a similar “disregard for law.”

2009—Odd bedfellows, indeed! Supposed constitutional conservative Theodore B. Olson, solicitor general under President George W. Bush, betrays the legal principles that he has purported to stand for over the course of his public career as he joins forces with liberal David Boies, his adversary in Bush v. Gore, to file a lawsuit asking a federal district court in California to invalidate Proposition 8 and invent a federal constitutional right to same-sex marriage.

2009—Implementing his threat to select a justice who will make decisions based on empathy, President Obama nominates Second Circuit judge Sonia Sotomayor to fill the seat of retiring justice David Souter. During the confirmation process, the “wise Latina” (at least in her own self-conception) will demoralize and disgust her supporters on the Left, as she implausibly masquerades as a caricature of a judicial conservative and even emphatically repudiates Obama’s empathy standard.

Yesterday, Pennsylvania Republican state representative Daryl Metcalfe, chairman of Pennsylvania house’s State Government Committee, scheduled a hearing to evaluate the tax status of certain “politically active” nonprofit groups, and scrutinize Pennsylvania’s related state-level enforcement efforts.

In light of the current IRS scandal, one would expect Republicans to avoid appearing to target nonprofit public-policy organizations for extra government scrutiny. Not Representative Metcalfe, who seems to be focusing on one liberal 501(c)(4) in particular, Pennsylvanians for Accountability. The group recently ran issue ads criticizing Republican governor Tom Corbett, and they apparently also ran ads during the 2012 election cycle.

Despite claims that he is not singling out Pennsylvanians for Accountability, Representative Metcalfe publicly worries that the group is too political. However, the facts tell a different story:

But it’s not entirely clear Pennsylvanians for Accountability is operating outside the law.

The state law concerning political advertisements by individuals or groups that are not registered as political action committees is clear. It reads that any person “who makes independent expenditures expressly advocating the election or defeat of a clearly identified candidate” must disclose financial information.

But Pennsylvanians for Accountability did not specifically use words such as “vote against” or “defeat” in their ads targeting House Republicans last year.  The same is true of their current ads attacking Corbett for giving corporate tax breaks while supposedly cutting education funding.

“Anything short of that and you can make a case that it is issue advocacy,” said Ron Ruman, spokesman for the state Department of State. Nonprofits registered with the department are allowed to spend on advertisements for issue advocacy without disclosing donors.

Metcalfe’s hearing seems designed to send the message that certain issue-based groups, especially those who oppose decisions by Governor Corbett or his allies, will face retaliation, if not investigations or enforcement actions. 

It is sad to see Pennsylvania Republicans following the lead of their Republican colleagues in Texas in thumbing their nose at the First Amendment. They should be thankful that the First Amendment allows people and organizations to collaborate and express their opinions in ways that shield them from retaliation or harassment. Instead, they seem hellbent on maximizing the advantages of incumbency, by using government’s enforcement apparatus to target their political opponents. I’m reminded of this scene from Blazing Saddles. I hope they will forgive me for not offering up a harrumph:

I’ve been getting a number of questions about the IRS’s Lois Lerner pleading the Fifth this week during her congressional appearance. Let me provide some background and suggest an avenue that could unearth the facts of this scandal quickly while at the same time confer the immunity Lerner seeks.   

Let’s dispose of the waiving issue first:  I agree with the agreeable Hans von Spakovsky that Lerner’s brief statement prior to invoking the Fifth won’t trigger a contempt charge. It was akin to a civil proceeding, a clear distinction from the criminal proceedings that rarely allow a witness to invoke the Fifth Amendment selectively. As with any issue, I am open to hearing other opinions on this waiving business, but as of now I am not persuaded. 

The whole point of the Fifth Amendment is predicated on the risk that criminal charges may be brought against you. For example, if a prosecutor has a witness who is pleading the Fifth, he can immunize that witness and compel him to testify. Anything he says on the stand cannot be used against him as long as he tells the truth. In the Lerner scenario, the House Committee on Oversight and Government Reform can simply have her testify either 1) while not under oath, or 2) after they have conferred immunity for her testimony while under oath. The latter has a powerful advantage over the former since anything she lies about opens her to a perjury prosecution, but as long as she tells the truth she will be in the clear. This has the added advantage of getting to the truth speedily, as opposed to learning the truth from a trial years from now. 

What I find curious is that the administration has not opted to take the one action that could allow the nation “to make sure that we understand all the facts.” If I am reading the case law correctly, this administration could simply compel Lerner to testify or face immediate termination. Since compelling testimony is analogous to a direct order, there is precedence for termination that doesn’t involve the typical procedures used to block the firing of civil-service employees (I recommend Daniel Foster’s excellent piece on the near impossibility of firing civil-service employees under normal circumstances).

As I explained during a speech earlier this year at the University of Arizona College of Law, when the government compels an employee or contractor to testify or otherwise make statements under the threat of job loss, nothing they say can be used against them in a prosecution. In fact, if they are prosecuted subsequent to the compelled statements, the prosecution bears the burden to show those statements were not used, or derivatively used, in any way whatsoever during a Kastigar hearing.

Compelling Lerner to answer specific questions concerning her official duties under the threat of job loss is well within the government’s power. This would accomplish two things at once: 1) free Lerner to testify so we can “make sure that we understand all the facts” and 2) simultaneously immunize her from prosecution for anything she says during that testimony. I have not read any persuasive legal argument from the administration as to why they have not already compelled Lerner’s testimony. The faster we get the truth about our nation’s most powerful government office violating the constitutional rights of citizens, the better. 

Today the Senate unanimously confirmed deputy solicitor general Sri Srinivasan to a seat on the U.S. Court of Appeals for the D.C. Circuit.  Srinivasan is the first Obama nominee to be confirmed to the D.C. Circuit. While there are three additional vacancies, there are no other pending nominees.  The only other person President Obama nominated to the court, Caitlin Halligan, withdrew in the face of Republican opposition. Now that he has been confirmed to the D.C. Circuit, many expect Srinivasan to be on President Obama’s short list should there be another Supreme Court vacancy during the remainder of his term. 

Yesterday, a Seventh Circuit panel heard oral argument in two cases in which Catholic business owners and their companies argue (correctly, in my judgment) that the Obama administration’s HHS mandate on contraceptives and abortifacients violates their rights under the federal Religious Freedom Restoration Act. According to this Chicago Tribune article:

[I]n an unexpected twist during a hearing on the merits of a preliminary injunction, the lawyer for the U.S. government argued that accommodating the business owners’ religious beliefs could violate the First Amendment as well.…

Alisa Klein, an attorney for the U.S. Department of Justice, said allowing a company to impose a religious framework on a diverse workforce would amount to fostering or enabling religious practice.

“At bottom, the concern is about establishing religion,” Klein said.

There are two good reasons why the DOJ attorney’s argument that vindicating the RFRA rights of the business owners would violate the Establishment Clause was an “unexpected twist.”

First, DOJ never made that argument in either of its Seventh Circuit briefs in the two cases.

Second, there is good reason that it didn’t, for the argument is inane. RFRA imposes against the federal government the general standards of Free Exercise jurisprudence that existed before the Court’s 1990 decision in Employment Division v. Smith. Thus, if a claimant has a meritorious RFRA claim, that means that he would have had a meritorious Free Exercise claim under the pre-Smith regime. Just as vindicating that Free Exercise claim wouldn’t have violated the Establishment Clause, so vindicating business owners’ RFRA rights wouldn’t violate the Establishment Clause.

In sum, whether or not the business owners have a valid RFRA claim should be determined by applying the terms of RFRA. There is no basis for invoking Establishment Clause concerns to read RFRA in a manner that is less protective of religious liberty.

The DOJ lawyer’s argument (as paraphrased by the article) that the business owners are seeking “to impose a religious framework on a diverse workforce” is also wrong. As I explain (in the first hyperlinked item), the business owners are seeking merely not to be dragooned by the federal government into violating their religious beliefs, and the federal government has ample alternative means of providing contraceptive/abortifacient coverage to their employees.

1957—Three Cleveland police officers arrive at Dolly Mapp’s home seeking a suspect wanted in connection with a recent bombing. After Mapp refuses to admit them, the police forcibly enter and search the home and discover obscene materials. Mapp is convicted of possession of these materials. The Ohio supreme court rules that the search of the home was unlawful but that Mapp’s conviction resting on evidence resulting from the search is valid.

In Mapp v. Ohio (1961), the Supreme Court, by a vote of 5 to 3, overrules its own 1949 precedent that held that the Constitution does not require that evidence obtained in violation of the Constitution be excluded from criminal trials in state court. The Court instead applies to state criminal trials the exclusionary rule that it first imposed on federal criminal trials in 1914. In dissent, Justice Harlan (joined by Justices Frankfurter and Whittaker) concludes his analysis with this observation: “I regret that I find so unwise in principle and so inexpedient in policy a decision motivated by the high purpose of increasing respect for Constitutional rights. But in the last analysis I think this Court can increase respect for the Constitution only if it rigidly respects the limitations which the Constitution places upon it, and respects as well the principles inherent in its own processes. In the present case I think we exceed both, and that our voice becomes only a voice of power, not of reason.” 

The Wall Street Journal has picked up on the Texas legislature’s attempt to force certain 501(c)(4)s and 501(c)(6)s to disclose their donors:

In 2012, independent political spending by 501(c)(4)s and 501(c)(6)s made up about 1% of overall election spending in Texas, hardly a political juggernaut. But the Texas saga shows that the only people who like campaign finance restrictions more than liberals are incumbents, who want to limit potential donations or advertising support for challengers. . . .

Mr. Seliger’s bill passed the Senate unanimously in April. But when Republicans realized what they’d voted for, two-thirds of the chamber voted to recall the bill from the House for a revote. That courtesy is routinely extended within the Texas legislature, but this time Mr. Geren refused. To force the bill directly to the Governor’s desk, he moved the bill through the House unamended and it passed 94-51 with 51 Republicans opposed.

Governor Rick Perry has until the end of the week to veto the bill or it becomes law. A spokesman says he is “reviewing” the measure, and the staffer didn’t seem happy that we were asking the question. This veto should an easy call for a Governor who claims to dislike the self-interested ways of President Obama’s Washington.

As I wrote last week, Governor Perry has said that the McCain-Feingold campaign-finance law was an “unconstitutional . . . restriction of free speech,” so he should have no problem vetoing this bill – unless his devotion to the Constitution was just a campaign gimmick.

1991—Federal district judge H. Lee Sarokin delivers a This Day classic. The backdrop: Richard R. Kreimer, a homeless man, camped out in the Morristown, New Jersey, public library, was belligerent and disruptive, stared at and followed library patrons, talked loudly to himself and others, and had an odor so offensive that it prevented areas of the library from being used by patrons and from being worked in by library employees. The library then adopted written policies setting forth minimal standards of patron behavior. After Kreimer was expelled multiple times for violating the policies, he sued.

Poetically pronouncing that “one person’s hay-fever is another person’s ambrosia,” Judge Sarokin rules that the library is a traditional public forum like a street or sidewalk, that the library’s policies are overbroad and vague in violation of the First Amendment, and that they violated substantive due process, equal protection, and the New Jersey constitutional guarantee of free expression. On appeal, the Third Circuit will unanimously reverse Judge Sarokin on every ruling.

By in effect concocting a right for Kreimer to disrupt a public library, Sarokin deprived other citizens of the right to use a library in peace. Not incidentally, Sarokin was said to be very finicky about the conditions of his court’s library. (For a fuller discussion of this This Day classic, see Part I here.)

With the ardent support of Senate Democrats like Patrick Leahy (“a judge of proven competence, temperament, and fairness,” “an excellent choice”), President Clinton will appoint Sarokin to the Third Circuit in 1994.

The epidemic of Anti-Scalia Derangement Syndrome continues unabated. A particularly bizarre instance of ASDS struck a Volokh Conspiracy blogger yesterday.

As I outlined, Justice Scalia wrote the majority opinion (joined by Justices Thomas, Ginsburg, Sotomayor, and Kagan) in a ruling issued yesterday in City of Arlington v. FCC. Early in his opinion, Scalia refers to an entity named CTIA—The Wireless Association and appends this footnote:

This is not a typographical error. CTIA—The Wireless Association was the name of the petitioner. CTIA is presumably an (unpronounceable) acronym, but even the organization’s website does not say what it stands for. That secret, known only to wireless-service-provider insiders, we will not disclose here.

On the Volokh Conspiracy, law professor David Post lambastes the footnote as “a really embarrassing bit of nonsense—smarmy and snarky and extraordinarily stupid.” Alas, Post’s name-calling better applies to his own post.

According to Post:

0.45 seconds of work reveals that CTIA originally stood for the “Cellular Telephone Industry Association.” It’s not a big mystery, “known only to wireless-service-provider insiders”: that’s what it says on the organization’s Wikipedia page. So Scalia’s footnote communicates, to me, that he has never heard of “the Internet” and the very amazing things called “search engines” that let you “retrieve information” very, very quickly[.]

Post supposes that neither Scalia nor any of his clerks nor any of the other joining justices or their clerks managed to figure out what “CTIA originally stood for” (Post’s phrase) or “what it stands for” now (Scalia’s). He seems not to consider the obvious alternative possibility that Scalia’s talk of a “secret” is lighthearted (as the matter of what the letters stand for is irrelevant to the purpose of his footnote, which is to confirm for the attentive reader that the ridiculously ungainly name of the organization is indeed its actual name, not a typo).

What’s funnier is that the unhinged Post doesn’t even get his facts right or complete. According to the Wikipedia page of CTIA—The Wireless Assocation, CTIA “originally stood for Cellular Telecommunications Industry Association” (emphasis added), not “Cellular Telephone Industry Association.”* Then, from 2000 to 2004, CTIA stood for “Cellular Telecommunications and Internet Association.” And now, according to the organization’s blog, CTIA is an “orphan acronym” that stands for nothing.

(I learned about the organization’s blog post from this BLT item by Tony Mauro, which shows its own signs of ASDS in its bizarre title, “Scalia Fumes Over Name of Telecom Trade Group.” Yes, that footnote is just seething with anger.)

* 10:25 a.m.: I now see that the Wikipedia entry has been edited since yesterday to make a change to this sentence, so Post accurately quoted the (evidently) mistaken Wikipedia entry.

In its lead house editorial today, the Wall Street Journal passes along word that “President Obama is close to nominating several new judges to sit on the D.C. Circuit Court of Appeals.” That’s in addition to the pending nomination of Sri Srinivasan, which the Senate Judiciary Committee unanimously reported to the full Senate last week. The WSJ makes a strong case for the Senate not to act on any new nominations. An excerpt:

The court doesn’t need the judges. The D.C. Circuit is among the most underworked court in the federal system.…

Last year the D.C. Circuit saw 108 appeals per authorized judge, compared to roughly four times as many on the Second and Eleventh Circuits—the country’s busiest. And the court’s workload is trending down. Even if the court had only eight authorized judges, its docket would still be among the lightest in the country.

Sam Kazman and Michael Carvin have a great Forbes op-ed about their new Obamacare lawsuit, which could invalidate key portions of the law in the 33 states that did not set-up state-based health-insurance exchanges. Essentially, the lawsuit alleges that the IRS illegally rewrote the Affordable Care Act so that both the employer mandate and accompanying government subsidies applied in the 33 states that lack their own health-insurance exchanges:

In more than half the country, the implementation of ObamaCare has been premised on a patently illegal regulation—a lawless “quick fix” designed by the Administration to circumvent the fact that roughly two-thirds of the states have effectively chosen to “opt out” of the Affordable Care Act’s intrusive mandates. A new lawsuit, recently filed by us in federal district court in D.C., will expose that flaw in ObamaCare’s very foundation, vindicating the right of these “refusenik” states to shield their citizens from an overreaching federal government. Specifically, although the Act’s plain language makes clear that a State’s citizens may receive subsidies and a State’s employers are required to offer health insurance if—but only if—the State decides to run the Act’s insurance “Exchange,” a new IRS rule completely rewrites this scheme and purports to make the subsidies and employer mandate applicable even where the State has opted out and the federal government runs the “Exchange.”

A little background will help clarify what is at stake. One of the linchpins of the Act is the establishment of new, State-operated insurance “Exchanges”— a type of virtual marketplace where insurers could sell standardized health insurance products on the individual market, under the watchful eye of regulators. These Exchanges are the vehicle for distribution of the federal “premium assistance” subsidies that were intended to make comprehensive insurance affordable for millions of Americans. And those subsidies, in turn, are supposed to encourage businesses to sponsor affordable health coverage for their employees, because the Act penalizes employers if any of their employees receives a federal subsidy after buying an individual policy on an Exchange. Without these Exchanges and accompanying subsidies, millions of individuals would be effectively exempt from the law’s “individual mandate,” because insurance would be too expensive for them to buy; and businesses would not be subject to the “employer mandate” to sponsor employee coverage. Those are two of the Act’s central pillars

Plaintiffs in this lawsuit include small businesses and individuals in six states. The employer mandate would make it unaffordable for one business to hire some full-time employees, while another business objects to Obamacare’s strait-jacket approach to mandating insurance coverage, which prevents the business from providing consumer-driven health insurance.

You can read the complaint here.