Individual mandate unlikely to be struck down

In the waning hours before release of the opinion, I am compelled to make my prediction regarding the Supreme Court ruling on Obamacare.

I believe the individual mandate will not be struck down.

Specifically, one or more of the following, on stare decisis grounds or on the grounds that it is a political question, will rule that the government with a rational basis may compel the purchase of a product pursuant to the commerce clause: Scalia, Roberts, or Kennedy.

I believe the states themselves will be considered to not have standing to challenge the individual mandate, and this will likely be a 6-3 or 7-2 decision.

I believe that the states' challenge on Medicaid grounds will be defeated unanimously.

I believe one or more of the following will rule against the challengers to the individual mandate due to either a lack of ripeness, failure to comply with the anti tax injunction act, or complete lack of standing: Ginsburg, Sotomayor, Breyer, Kagan, or Kennedy.

If all of the above happens, then the individual mandate will not be struck down, but will not be deemed constitutional.  The fight will be left for another day.

I hope I am incorrect...

Legal qualifications for candidacy in Virginia elections explained

I have seen repeated concerns in Virginia political blogs about the residency requirements for candidates for political office.  The practical effect of allegedly failing to meet residency requirements appears to be minimal.  This post is specifically designed to explain the law behind the residency requirements for candidates for Virginia public office, and the potential consequences of failing to meet those requirements.

How does one become qualified to hold a public office?

“In order to hold any [elected] office . . .the candidate must have been a resident of the Commonwealth for one year next preceding his election and be qualified to vote for that office.”  Va. Code § 24.2-500.  Keep in mind this is simply to hold an office.  This is not the requirement to run for the office, or to be voted in to office.  This is the requirement to be sworn in.

How does a candidate become qualified to be a candidate for a particular public office?

“In order to qualify as a candidate for any office . . . a person must be qualified to vote for and hold that office.”  Va. Code § 24.2-500.  A similar provision applies to candidates in primaries under Va. Code § 24.2-519.  It is not actually possible to tell at the time that one qualifies as a candidate if that person will actually be a resident up until the actual election.  Presumably, the legislature means that to qualify you must be a resident for the year preceding the date one qualifies as a candidate.  The alternative is that this portion of the statute is potentially unenforceable as vague. 

How does one become “qualified to vote?”

Both the previous situations - holding an office, or qualifying as a candidate for an office -  require that the candidate or officer be qualified to vote for the office in question.  “‘Qualified voter’ means a person who is entitled to vote pursuant to the Constitution of Virginia and who is (i) 18 years of age on or before the day of the election…, (ii) a resident of … the precinct in which he offers to vote, and (iii) registered to vote.” Va. Code § 24.2-101.  Items i and iii are factual and self explanatory.  Item ii and the definition of “resident” is less clear.  "Residence" or "resident," for all purposes of qualification to register and vote, means and requires both domicile and a place of abode. To establish domicile, a person must live in a particular locality with the intention to remain. A place of abode is the physical place where a person dwells.”  Va. Code § 24.2-101.  The definition of abode is fairly self explanatory.  Domicile is a legal term of art that can generally be proven by showing that one intends to remain by changing mail delivery, drivers’ licenses, car registrations, and tax filing addresses to the new home.  It requires a very fact intensive analysis.

What does it take to get on the ballot?

Here is where the threat of criminal sanctions can arise in egregious situations.  A statement of qualification for candidacy must be filed by the candidate pursuant to Va. Code § 24.2-503.  In 2011 the dates for filing are different under HB 1507 due to redistricting.  There are different dates for filing the statement depending on if there is a primary, or if there is no primary.  The terms of the statement required are detailed in Va. Code § 24.2-501, which states in part “a person must file a written statement under oath, . . . that he is qualified to vote for and hold the office for which he is a candidate.” 

A statement made under oath, particularly to an agency of the Commonwealth of Virginia or its subparts is subject to potential criminal sanction under Va. Code § 18.2-434, which states in part “any person to whom an oath is lawfully administered on any occasion . . . willfully subscribes as true any material matter which he does not believe is true, he is guilty of perjury, punishable as a Class 5 felony.”  Under Va. Code § 18.2-10, class five felonies are punishable with “a term of imprisonment of not less than one year nor more than 10 years, or in the discretion of the jury or the court trying the case without a jury, confinement in jail for not more than 12 months and a fine of not more than $2,500, either or both.”

So what are the remedies for a candidate or voter negatively affected by the candidacy of a person not capable of holding or being a candidate for a particular office?

A. Criminal Sanctions

The reader must understand that prosecution of criminal matters is at the discretion of the local Commonwealth’s Attorney.  Anyone with knowledge of a crime can swear out the warrant for someone’s arrest.  But, a magistrate does not have to issue the warrant, and the prosecutor can drop the case.  The only actual crime potentially arising out of a situation with a non-legally qualified candidate is perjury under Va. Code § 18.2-434 for the action of submitting the false statement of qualification under oath.  Not only do criminal matters need to be proven beyond a reasonable doubt, but perjury requires that the person making the sworn statement “know” that the statement they are making is not true.  This last element must be proven by a prosecutor, whereas any candidate can easily claim they made an innocent mistake.

Functionally prosecution is nearly impossible.  Any Commonwealth's Attorney that pursues this route will likely lose in a high profile, politically charged case.

B. Civil administrative remedies by the SBE or local registrar

These folks are performing administrative duties.  It is not their job to research the histories and backgrounds of potential candidates.  There is nothing improper about them accepting a statement of qualification of candidacy at face value.  In fact, if after receiving a statement of qualification containing all the required elements, and requisite petition signatures, a registrar refused to place a candidate on the ballot due to the registrar's own belief that the candidate is not legally qualified, then the registrar should expect to be subject to a writ of mandamus an unusual legal proceeding designed to force a public official to perform a ministerial act.

This is not the place to seek a remedy.

C. Civil enforcement between private parties

The proper and effective route to challenge a legally unqualified candidate is to bring a civil action against the candidate as early as legally possible.  This lawsuit must be brought on behalf of someone directly affected by the improper candidacy (opposing candidate, voter, local political committee), and must be brought against the legally unqualified candidate, and the local registrar and SBE depending on the type of office.  The party bringing the lawsuit should immediately seek a preliminary injunction against placement of the legally unqualified candidate on the ballot.  The preliminary injunction against placement on the ballot, although difficult to obtain, will likely be the only potential remedy.  The court has the power to reject an injunction after an election on the grounds that it is not in the public interest to upset the results of an election. 

If the goal is simply to make a statement about how a candidate was never legally qualified, a lawsuit after the election is possible.

These remedies require payment of substantial attorneys' fees and the posting of a bond if successful at the preliminary injunction stage.  Between the difficulties in obtaining an injunction, and the costs involved no one seems willing to pursue this route.

Conclusion

There is only one legal remedy (civil enforcement) for someone affected by a candidate they feel is not legally qualified.  Otherwise affected parties can attempt to persuade voters of the illegal nature of a persons candidacy in the court of public opinion.  The problem with this latter route is that voters never seem to notice - or if they do notice they do not care.

Previous shorter versions of parts of this explanation can be found in my comments at:
http://virginiavirtucon.wordpress.com/2011/05/04/where-does-ron-speakman-live/
http://www.tooconservative.com/?p=9395

Option II for the Commonwealth: Unexpected Orders in the Fourth Circuit challenges to the individual mandate still bad, but not as awful as originally thought

On Monday May 23, 2011 the Fourth Circuit issued two identical orders in Commonwealth v. Sebelius and Liberty U. v. Geithner requiring additional briefing on the issue of the Anti Injunction Act [AIA].   On May 24, I explained why this is not the worst news for the Commonwealth of Virginia.  Below is an alternate explanation as to why the Anti-Injunction Act [AIA] does not apply, and Monday’s orders are of less concern for the Commonwealth of Virginia’s case.

The Commonwealth of Virginia is also likely exempted from the AIA under the specific language of the AIA.  The AIA only enjoins lawsuits against the collection of a tax by a person under 26 U.S.C. § 7421.  A person is defined under 26 U.S.C. § 7701(1)(a) as follows:

"The term “person” shall be construed to mean and include an individual, a trust, estate, partnership, association, company or corporation."

In a 1934 case analyzing a different taxation statute it was determined that the Commonwealth of Pennsylvania was a person under a statute that said “the word 'person' is to be construed as meaning and including a partnership, association, company, or corporation, as well as a natural person.”  Pennsylvania, ex. rel. Schnader v. Fix, 9 F. Supp. 272, 276 (M. D. Pa. 1934).  On appeal, the Third Circuit in an indirect way stated the AIA applied to Pennsylvania as “the state had adequate remedy at law, viz., paying the contested taxes and bringing suit for the recovery of the same because allegedly illegally assessed . . .”  79 F.2d 520 (3d Cir. 1935).

The facts of that case are different than in Commonwealth v. Sebelius as Pennsylvania was trying to enjoin the enforcement of a federal tax on the state sale of alcohol, and Pennsylvania was actively engaging in the sale of alcohol.  In 2011 Virginia is not making the decision to forego the purchase of health insurance, the activity the Fourth Circuit is implying might be considered a taxable act. 

Ultimately, A state (or in this instance Commonwealth) is not a legal person under the AIA.  This issue does not appear to have been addressed in South Carolina v. Regan (keeping in mind that was 27 years ago).  As South Carolina v. Regan is the seminal case on this issue I doubt the definitions argument has ever been litigated. 

Click here. for my previous posts regarding the individual mandate.

Unexpected Orders in the Fourth Circuit challenges to the individual mandate still bad, but not as awful as originally thought

On Monday May 23, 2011 the Fourth Circuit issued two identical orders in Commonwealth v. Sebelius and Liberty U. v. Geithner requiring additional briefing on the issue of the Anti Injunction Act [AIA].  As indicated here, my opinion is that this reflects a strong preference among the Fourth Circuit panel of judges deciding these cases to declare that the penalty under the individual mandate is a tax.

In all of our (commentators') haste to analyze the unexpected demands of the Fourth Circuit in Commonwealth v. Sebelius and Liberty U. v. Geithner, there was a dearth of analysis as to the different effect the AIA might have on the Liberty U. Plaintiffs as opposed to the Commonwealth of Virginia.  Upon further reflection, Monday’s orders still reflect an unexpected setback, but not as much for the Commonwealth of Virginia.  The reason for the lack of effect on the great Commonwealth can be found in a 1984 Supreme Court decision regarding the ever interesting subject of the taxation of interest on state issued bonds.  (seriously, do not read the whole decision unless you are having trouble sleeping).   

Does the AIA apply to the states?

In the matter of South Carolina v. Regan, the Supreme Court addressed an instance in which the federal government sought to bar a state from pursing a remedy due to the AIA. 465 U.S. 367 (1984).  In Regan the Supreme Court stated “the Anti-Injunction Act's purpose and the circumstances of its enactment indicate that Congress did not intend the Act to apply to actions brought by aggrieved parties for whom it has not provided an alternative remedy.”  465 U.S. at 378.  Further the AIA “was intended to apply only when Congress has provided an alternative avenue for an aggrieved party to litigate its claims on its own behalf.”  465 U.S. at 381.

Virginia has no alternative avenue to litigate these claims.  The short version of the holding on the issue relevant to Virginia in Commonwealth v. Sebelius is as follows: If Virginia could never itself pay the tax and then seek a refund as suggested under 26 U.S.C. § 7422, then the AIA does not apply and Virginia may proceed with this lawsuit.  Perhaps in an oversimplification of the holding one could say “the AIA does not apply to the states.”

What does this mean for the Commonwealth of Virginia?

The negative consequences indicated here will not befall the Commonwealth.  Instead the Fourth Circuit will likely throw out Virginia’s claims on standing grounds as indicated in oral argument (I explained this here).

What does this mean for the Liberty U. Plaintiffs?

The Fourth Circuit is seriously considering the individual mandate a tax and dismissing the Liberty U. case pursuant to the AIA.

What does this mean for substantive rulings on the individual mandate?

If the Fourth Circuit finds against the Commonwealth on standing and against the Liberty U. Plaintiffs under the AIA, then the Fourth Circuit will have avoided ruling on the substance of the individual mandate in the PPACA.  The Supreme Court can then still deny certiorari for the Fourth Circuit cases without affecting the Constitutionality of the individual mandate.  The only hope in this situation is that the Commonwealth can convince the Supreme Court that the issue of standing for states is just as important as the Constitutionality of the PPACA, and argue both standing and the Constitutionality of the individual mandate in the Supreme Court.

The second reason the Commonwealth of Virginia should be less concerned about the additional briefing orders can be found here.

Click here. for my previous posts regarding the individual mandate.

Virginia healthcare challenges suffer further unexpected setbacks

UPDATE:  This setback has different effects on the Commonwealth of Virginia and the Liberty U. Plaintiffs.  See details here and here.

Unexpectedly on Monday afternoon the Fourth Circuit Panel that heard oral argument in Commonwealth v. Sebelius and Liberty U. v. Geithner ordered the parties to provide supplemental briefing on a narrow set of issues barely addressed at any stage thus far.

The ordering of supplemental briefs after oral argument is quite unusual by itself, moreover the subject matter of the additional briefs should be cause for concern by opponents of the individual mandate.

The Orders require that the parties must submit supplemental briefs by May 31, 2011 on three subjects.

1. When applicable, does the Anti-Injunction Act, 26 U.S.C. § 7421(a), deprive a federal court of subject-matter jurisdiction? See J.L. Enochs v. Williams Packing & Navigation Co., 370 U.S. 1, 5-8 (1962). If so, does it divest federal courts of jurisdiction in this case? See Bob Jones University v. Simon, 416 U.S. 725, 736-48 (1974).

2. Can a court determine that a challenged exaction qualifies as a “tax” for purposes of the Anti-Injunction Act without reaching the question of whether the exaction qualifies as a “tax” for purposes of Art. I, § 8, cl. 1? Compare Bailey v. George, 259 U.S. 16 (1922), with Bailey v. Drexel Furniture Co., 259 U.S. 20 (1922).

3. Assuming the Anti-Injunction Act does apply in this case, does a plaintiff have the ability to challenge the exaction provided by § 5000A in a refund suit or otherwise? See 26 U.S.C. § 7422(a); 28 U.S.C. §§ 1331, 1340, 1346.

What is the anti-injunction act all about?

In order to avoid prolific anticipatory (before tax enforcement) litigation seeking to prevent the government from enforcing a particular tax, there is a federal statute prohibiting lawsuits seeking injunctions against collection of federal taxes.  There are exceptions to this act.  In many instances when a tax has been erroneously collected the remedy for the taxpayer is a lawsuit under 26 U.S.C. § 7422 after presentation and denial of a claim for refund.

Where does this leave us on the schedule?

The Fourth Circuit will not be deciding either case until at least after May 31, 2011.  Moreover the Fourth Circuit will likely want to take some time to consider the arguments in the briefs.  In terms of timing, this is a setback for the Virginia cases, and may just put them directly on par, in terms of timing, with the Florida case going before the 11th Circuit in early May.

What does this mean for the substantive outcome of the cases?

This is a setback.  It means the Fourth Circuit is seriously considering declaring the penalty under the individual mandate a tax, and barring both cases on procedural grounds.  If this were to occur, the Supreme Court could deny certiorari for the Virginia cases, without resulting in a substantive effect on the Constitutionality of the individual mandate.  The Virginia Plaintiffs would then be left until after actual imposition of the tax penalty before a remedy could be had that challenges the Constitutionality of the individual mandate.  This would set these cases back for years.

Order in Commonwealth v. Sebelius can be found here.

Order in Liberty U. v. Geithner can be found here.


Click here. for my previous posts regarding the individual mandate.