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Tuesday, August 3, 2010

No Need For Delay In VA Obamacare Lawsuit

Yesterday a federal judge in Virginia released an opinion permitting the lawsuit by the State of Virginia, challenging the mandate provisions of Obamacare, to move forward. In legal parlance, the judge denied a motion to dismiss.

Pro-administration commentators have bent over backwards to portray this opinion as a minor procedural loss for the Obama administration in what will be a lengthy trial court process. These commentators are understating the importance of this opinion in favor of political spin.

On a motion to dismiss, a judge does not try the facts, and indeed is required to accept the plaintiff's factual allegations as true. At that stage, the judge considers only whether the facts together with the legal allegations, state a legally-cognizable cause of action. The judge here found that Virginia had stated causes of action which, if granted, would invalidate the mandate provisions.

The significance of the opinion comes from the fact that a lawsuit challenging a statute is not like a lawsuit arising out of a car accident or some other contested set of facts. In most cases, you need depositions and extensive document exchanges in order to understand what happened, and live trial testimony so that jurors or the court could judge the credibility of witnesses.

Here, there really are few if any contested facts. The legislation says what it says. To the extent congressional intent is relevant, the legislation purports to express that intent and the congressional and public records are what they are.

This is a case which should very easily move to the judgment phase under a procedure called "summary judgment." Under a summary judgment procedure, the court can rule on the merits of the case based upon the uncontested facts and the law.

A case like this would seem ripe for a summary judgment procedure. The material facts -- the text of the legislation and the congressional record -- are not contested, although the parties may see the same evidence in different ways. The law is what it is; the judge is going to have to reach conclusions on legal issues as to which he already has opined.

There is no reason that this case could not be set on a relatively short schedule at which point the judge could rule on the merits and enter a final judgment accordingly.

If the Obama administration is a confident as its press release reflects, it should welcome a prompt resolution on the merits.

Update: A hearing on the merits has been set for October 18.

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  1. Cross posted at volokh:

    > This decision is FUBAR. mind you i am glad about the short term result. but this decision is wrong as a matter of black letter law.

    > The judge basically said, "well, i am not sure who is right on the law, so i won't dismiss." Buzzz, wrong answer. A motion to dismiss (by a defendant) is really basically this argument: your honor, even if the plaintiff's factual allegations are all true (and we are not necessarily conceding that), he still loses on the law. That requires the judge to apply the law to the hypothetical facts. This doesn't allow him to punt on the question.

    > The whole purpose of a MTD is keep the courts and the litigants from wasting their time on a claim that cannot possibly succeed. The judge should have decided it and this error is actually so serious i could see in theory an interlocutory appeal coming out of it. i mean it won't happen because why would anyone want to, but its theoretically possible.

    I would add for this blog, William, that I think your analysis is confusing what the judge should have done with what he did do. the judge was very non-committal on what the law actually said. You might suspect he is leaning against it, but its far from clear.

    I would add that the HHS had a particularly idiotic argument: everyone will eventually need medical services, so everyone will eventually affect interstate commerce. um, actually, there are many states that explicitly protect a right to refuse treatment, and alot of good arguments that you have a constitutional right to do so.

  2. @A.W. - I don't think the judge was off base. His opinion is pretty clear that there are valid legal theories behind the lawsuit, and the legal claims are not deficient as a matter of law. That's all he needed to find at this stage Could he have been more affirmative, sure. But he did not have to rule on the ultimate legal issue yet, which of necessity will require some fact finding (even if it is on an uncontested record).

  3. Prof Jacobson:
    I am confused. Throughout the debate, the O Admin admantly affirmed that Obamacare was "not" a tax. However, their rebuttal to the VA lawsuit states that it is indeed a "tax" and therefore within their purview.

    It is my understanding that legislation with respect to taxing authority has a specific lineage requirement, and Obamacare did not travel along this path required for any new "tax" legislation.

    If this is true, and the O Admin is now admitting Obamacare is indeed a "tax", does this now open up yet another line of attack to have Obamacare struck down and force HHS to go back to the drawing board?

    I don't know anything about how various pieces of tax legislation must originate (ie: house or senate),etc which is why I am asking and hoping you will elucidate.

  4. In your estimation, what is "a relatively short schedule?" Before or after the elections? That might just be a game changer for November.

  5. Absolutely disagree.

    the entire purpose of the MTD is to weed out claims that are so frivolous as a matter of law that even if the defendant did everything alleged in the complaint, the plaintiff still loses.

    Either the VA AG has stated a claim upon which relief can be granted if he proves the facts alleged, or he has not. there is no maybe in that, there is no Schrödinger’s cat, when it comes to the legal questions. The whole purpose is to decide if the law allows for the relief requested. The answer can’t be “maybe.”

    Now I think what is tripping you up is in this case the motion to dismiss would be properly the whole enchilada. I would have trouble imagining a disputed fact coming out in the defendants’ favor and that being decisive on the matter.

    But take a more normal example. Company A sues company B for breach of contract. But company B comes back and says 1) we didn’t do the acts they alleged and 2) even if we did, its not a breach of contract. If the second argument is true, there is no point in deciding the first issue and generally that is cheaper for both the court and the litigants. So the motion to dismiss is the proper vehicle to determine the answer to that question. it is the right of the defendant to a determination of the law on that point, because otherwise they will have to endure at least the expense of discovery and trial preparation.

    Now that is not such a serious concern here because I am not sure how much discovery will actually occur and I doubt it will be particularly burdensome in any case. But that doesn’t change the fact this is the wrong decision. Black letter wrong.

  6. And just to be clear there is no sock puppetry here, A. Worthing is the same guy as A.W. i just have a different email for my everyone draw mohammed website.

  7. "...actually, there are many states that explicitly protect a right to refuse treatment, ...

    Great point and needs to be expanded upon. How is HHS' position consistent with the 10th Amdt. My right to refuse a commercial product is no less than my right to refuse treatment.

  8. aucturian

    i have long said that if we take roe v. wade seriously as a constitutional right, it is impossible to reconcile that rule with obamacare. i mean if roe is something other than judicial fiat (a big IF i know), it stands for an extreme application of the right to control your medical destiny.

    i would add that yes, there is better basis for saying that you can refuse medical treatment than buying a commercial product, because medical treatment involves consenting to bodily touching. imagine if you are a woman and the state says you have to see Doctor A for your OBGYN, and you think the guy is a major perv. too bad, you have to let him touch you, in intimate ways.

    but if you read the opinion, it is pretty clear that if you can refuse treatment, its really hard to argue then that failure to buy health insurance is definitely an economic activity.

    But more basically, as per lopez, what the courts will want to hear from the obama administration is an answer to a simple question: if you can do this, what can't you do? the supreme court is never going to grant the federal government power without limit, period.

  9. "the supreme court is never going to grant the federal government power without limit, period. " -- A.W.

    If the SCOTUS is stacked with judges like Sotomayor and Kagan, we might just see "never" happen! The Congress has already given up much of its power in these last two mega-bills: ObamaCare and Financial Reform - where the legislative branch gave the executive branch complete control of appointing, monitoring, and managing the whole enchilada in BOTH cases!

    Let's pray no one else steps down or has any health issues on the SCOTUS the rest of this term.

  10. Prof. Jacobsen, I don't understand why these suits (this one and the Arizona suit brought by DoJ) are going on in the ordinary Courts. The Constitution, Art. 3, Sect. 2, Clause 2, says that if a State is a party to a legal action, the SCOTUS has original jurisdiction. Why aren't these things going straight to the SCOTUS?

  11. Dr.

    I think the logic goes like this. Yes, the Sup. Ct. can hear it under original jurisdiction, but so can any lower court--that is they have original jurisdiction, but not exclusive jurisdiction.

    Now there is a law purporting to limit their ability to excercise that jurisdiction, here: http://www.law.cornell.edu/uscode/28/1251.html

    But bluntly, i don't think the S.C. wants to be the trial courts in any of this. they consider it kind of a pain. so they are all too happy to watch states go through the briar patch of lower courts and at least by the time they get to the Supremes, the issues are really well developed and thought out.

    Correct me if i am wrong, professor.