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2011-2012 Supreme Court Term: Oral Argument by Amicus Curiae on the Anti-Injunction Act

by Professor Will Huhn on March 26, 2012

in Health Care,Wilson Huhn

The Supreme Court heard oral argument today on the issue of whether the Anti-Injunction Act applies to the individual mandate of the Affordable Care Act.  The transcript of oral argument is available here.  The bottom line is that it looks like the Supreme Court will proceed to the merits and decide whether the individual mandate of the Affordable Care Act is constitutional.

Several news outlets are reporting that, from what the justices said during oral argument, the Court is likely to find that the Anti-Injunction Act does not apply.  See Jennifer Haberkorn, Kate Nocera, Jason Millman, Political Pro, Court watchers: SCOTUS to blow past the AIA; Lee Ross, Fox News, Supreme Court Signals It Won't Punt on ObamaCare Decision.

I agree with the conclusions of those reporters. If the Supreme Court rules that way, it means that the Court has jurisdiction to decide the case this year and will proceed to determine whether the individual mandate is constitutional. Let's analyze what the justices said during the first part of oral argument that supports that conclusion.

As described in this previous post, the federal Anti-Injunction Act prevents the courts from hearing challenges to federal tax laws until the taxes have been assessed. If the AIA applied in this case the courts would have to wait until 2015 to decide whether the Affordable Care Act is constitutional. Both the federal government and the parties challenging the contended that the AIA did not apply, but because this issue goes to the power of the courts to hear the case, the parties are not permitted to "stipulate" that the courts have jurisdiction.  Accordingly the Supreme Court appointed counsel as amici curiae to argue that the AIA does apply and to produce the best arguments in support of that proposition.

Attorney Robert A. Long argued on behalf of the appointed counsel.  The Supreme Court gave him a very tough time.  The numbers in bold below are to the page of the transcript of oral argument.

4.  Justice Scalia told attorney Long that the language of the Affordable Care Act that provides that the penalty enforcing the individual mandate is applied to the Internal Revenue Service, not to the courts.

5.  Attorney Long argued that the Anti-Injunction Act must apply in order the protect the interests of the government in being able to collect taxes with the interference of the courts.  Justice Kennedy pointed out that taxpayers still have to exhaust their administrative remedies before they can go to court, and that if the courts wanted they could apply that rule of administrative law.

7.  Then Chief Justice Roberts chimed in in support of Kennedy's point, saying that if the Anti-Injunction Act does not apply, then the rules against hearing pre-enforcement challenges to tax cases are not jurisdictional in nature; in other words, whether to hear the case at this time is discretionary with the courts, not binding. Basically, this means that the Court would have the choice whether to hear this case or not. Roberts also asked Long whether he thought that Helvering v. Davis, an older case that said that the government could waive jurisdictional issues, should be overruled.

8.  Justice Ginsburg then pointed out differences in wording between the Anti-Injunction Act and another federal statute, the Tax Injunction Act. The Tax Injunction Act, she indicated, was directed to the courts and was clearly jurisdiction, but the Anti-Injunction Act was directed to parties and therefore could be waived by the government.

9.  Justice Alito then asked whether any previously decided cases would have come out differently if the Anti-Injunction Act were interpreted as being directed to taxpayers and not the courts. Attorney Long admitted that all of those cases would have come out the same.

11.  Attorney Long said that the Congress has "acquiesced" in the ruling that the Anti-Injunction Act is jurisdictional.  Chief Justice Roberts said that because the courts have gone back and forth on whether the law is jurisdictional, it isn't clear what Congress was "acquiescing" to.

11.  Justice Kagan mentioned a case, South Carolina v. Regan, where the court issued a ruling saying that there was an "equitable exception: to Anti-Injunction Act.

12.  Justice Sotomayor said that she counted at least four cases where the federal courts allowed "waivers" to the Anti-Injunction Act and three other cases where the courts recognized "exceptions" to the law.

14.  Justice Sotomayor then returned to Justice Alito's policy question: does it make any practical difference whether the Anti-Injunction Act is jurisdictional or not?

15.  Justice Scalia then took it upon himself to respond to Justice Sotomayor's question: "You could say that about any jurisdictional rule."  That is, that the question implies that the government should simply be permitted to waive any rule, even if it were jurisdictional.  Justice Scalia rhetorically asked, "Why should there be any jurisdictional rules?"

16.  Justice Breyer then turned to another problem with the statute – is the penalty associated with the individual mandate a "tax"?  He pointed out that the Affordable Care Act calls it a "penalty," not a tax.

18.  Justice Scalia agreed that there was "at least some doubt" whether this penalty is a tax.  "I find it hard to think that this is clear."

19.  Justice Ginsburg stated that the penalty associated with the individual mandate is not a "revenue-raising" measure because if it works as intended everybody will purchase health insurance and no penalties will be paid.  Sotomayor noted that federal statutes distinguish between taxes and penalties. Breyer remarked that he had told his law clerk to look up every single case listed in one of the briefs on this point and found out that every one of those cases involved a tax or a penalty for failing to pay a tax, not a penalty like the one imposed for failing to purchase health insurance.

21.  Justice Kagan then pointed out that there were other taxes and penalties in the Affordable Care Act that were expressly made subject to the Anti-Injunction Act, and that Congress failed to do that with respect to the individual mandate penalty.  Long conceded, "They could have been clearer about saying the Anti-Injunction Act applied."

23.  Justice Kennedy asked about the unusual wording of the Anti-Injunction Act, and Attorney Long responded that it was an old statute – 1867 – and that would accout for the "odd" phrasing.

23.  Justice Ginsburg then asked about another issue that the plaintiffs had raised.  The plaintiffs claimed that they were not challenging the penalty, but only the requirement to purchase health insurance. Attorney Long quite reasonably responded that the penalty was the only way that the individual mandate was enforced and therrefore could not be separated from the mandate. Justice Alito and Justice Kagan had follow-up questions about this issue.

29.  Justice Sotomayor asked Attorney Long whether the Solicitor General's reading of the Anti-Injunction Act would create any problems.  The Solicitor General argued that the AIA should be interpreted to apply to taxes, to penalties associated with non-payment of taxes, and to penalties that Congress expressly says are subject to the AIA.  Attorney Long once again conceded that "the Solicitor General's reading would probably create the fewest problems."

During Attorney Long's argument, eight justices repeatedly and vigorously expressed doubts about the applicability of the Anti-Injunction Act to this case. Although I have read transcripts where the justices expressed more anger or frustration, I have never seen the justices so united in rejecting an attorney's position.  In tomorrow's morning's post I will analyze the judges' reactions to the arguments by the government and the parties challenging the applicability of the AIA.

Wilson Huhn teaches Constitutional Law at The University of Akron School of Law.

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