Bench Memos

Unhinged Statutory Interpretation among the Netroots

After the D.C. Circuit released its opinion in Halbig v. Burwell striking down the IRS rule that grants tax subsidies to exchange plans purchased in states without state-run exchanges, the liberal blogosphere lit up with outrage. The New Republic’s Brian Beutler accused Judge Griffith’s majority opinion of taking the phrase “established by the State” out of context, accusing him of ignoring the whole-act canon that, Beutler contends, makes the statute’s meaning unambiguous in favor of the government.

But here’s how he explains this principle:

Insurance subsidies are valid in every state, regardless of which entity set up a particular state’s exchange. Sloppiness aside, there’s no ambiguity about the law’s “overall statutory scheme.” Other parts of the law make clear that its drafters contemplated subsidies in every state. This lower court judge agrees

This isn’t even an argument, much less statutory interpretation. It assumes the conclusion and makes an appeal to (now overruled) authority. Maybe he’ll elaborate later:

What the challengers have asked judges to do is to ignore the “fundamental canon” and buy into the idea that the Democrats who passed the law unambiguously structured it to withhold premium subsidies from states that refused to set up their own exchanges, as some sort of high-stakes inducement. This is plainly false. It’s the giant whopper underlying the entire theory of Halbig. A completely fabricated history of the Affordable Care Act, which treats the scores of reporters who covered the drafting of the law as idiots, and the aides and members who actually drafted it as bigger idiots and liars as well.

Hmm, nothing here either. Had Beutler read the majority opinion more carefully, he would have seen the part where Judge Griffith concludes that the legislative history doesn’t really help either side and rests his conclusion on basic statutory interpretation.

In a later piece, Beutler raises what he clearly thinks is a “gotcha” mistake in the majority opinion. In rebutting the dissent’s argument that Congress could not have intended to create a system that would have an adverse selection problem in practice, Judge Griffith points out that the ACA explicitly created a system that had adverse selection problems in the territories. Here’s what Beutler thinks is the mistake:

[But] “In letters sent July 16, the Obama administration notified territorial regulators that their residents would be largely exempted from health law requirements…perhaps most importantly the requirement that insurers offer coverage to all shoppers.”

In other words, contrary to opinion of the court, the administration believes that absent subsides (and thus absent a broadly applicable mandate) the coverage guarantee has to go as well, leaving the law’s explicit coverage goals well out of reach.

I imagine Griffith and his clerks finalized the opinion before the administration updated its position, and weren’t aware that a recent policy change had undercut his argument. 

Somehow, some way, Beutler thinks a “policy change” would “undercut” Griffith’s interpretation of the words in the statute. He appears to be unable to distinguish between law and policy.

Slate’s Emily Bazelon makes an analogous equivalency, calling it an error that Judge Griffith wasn’t “interested” in the fact that Scott Brown’s election in 2010 meant that the Democrats in Congress couldn’t pass the bill they wanted to pass. That’s certainly interesting political history, and is absolutely relevant to understanding the legislative history of the ACA. But Bazelon doesn’t explain how this ought to affect the interpretation of the statutory text. Courts are bound by legislation, not political history. After all, Congress chose to forge ahead with the ACA anyway, warts and all. Bazelon never explains why the compromised policy outcome should change the result.

She also blithely concludes that the 7–4 Democrat-Republican en banc D.C. Circuit will reverse the panel: “Presto: Harry Edwards’ dissent today can be a winner tomorrow.” As I mentioned before, I don’t think an en banc reversal is inevitable, even with the new Obama appointees. Bazelon seems to think party affiliation is nothing more than a proxy for legal analysis. It might turn out that way, of course, but the Supreme Court’s record of rejecting Administration positions this year suggests otherwise.

Jonathan KeimJonathan Keim is Counsel for the Judicial Crisis Network. A native of Peoria, Illinois, he is a graduate of Georgetown University Law Center and Princeton University, an experienced litigator, and ...


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