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July 22, 2014

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GMax

You thought wailing gnashing of teeth and rending of garments were way over the top on Hobby Lobby? Wait until this one percolates through the watermelons...

Texas Liberty Gal

@ap - BREAKING: Obama administration says health care subsidies will keep flowing despite court decision.

Anybody surprised???

Cecil Turner

Aw, c'mon, can't the Treasury just give money to whomever it wishes? Surely we don't need a law for that kind of thing, right? I mean, can't the IRS just adopt a regulation?

What good is that pen, if it can't sign a check?

GMax

Defying a ruling of a federal appeals court? I sincerely doubt they will do that. It will invite a strong response from the judiciary, maybe first seen in the House's lawsuit...

AliceH

Wish I knew the exact words they used re: continuing to pay subsidies under Fed HiX, but isn't it SOP to continue operating under status quo (barring an injunction) pending appeal?

Beasts of England

I'm baking a schadenfreude soufflé for lunch. Yummy!

Rick B

I'd like to see the BluGovIns in house legal staff memos regarding Treasury clawbacks of improperly paid subsidies. Should BluGovIns continue to offer product via the Federal exchange, assuming the risk of clawbacks?

It's a very sad day for Fascists everywhere.

Extraneus

Reid's nuclear option, which put 3 new Obama-appt judges on the DC Circuit, could save Obamacare.

— Sahil Kapur (@sahilkapur) July 22, 2014
Jane

Josh Earnest said you don't have to be a legal scholar to know what they really meant in the law, which is why the subsidies will flow.

Do any of you real lawyers know if the winners should/can get an injunction pending the appeal to the SC?

Danube on iPad

Alice, the court may or may not have entered a stay of its ruling pending appeal. I don't know.

Thomas Collins

I'll bet a stay will be entered pending a rehearing by the full DC Circuit.

glasater

Breaking News:

A White flag has been raised on the Brooklyn Bridge instead of the US flag.

Wow!

Thomas Collins

I think the most important immediate consequence of this is that, now that attention has been refocused on ObamaCare, it gives the GOP the opportunity to send a true reform bill to the Senate, and to push for true reform as part of the House and Senate races after Harry sits and farts on the reform bill in the Senate. My suspicion is that Boehner et al will be too timid to do this.

NK(withnewsoftware)

Not to be a pedantic lawyer, OK I am a pedantic lawyer, but this DC Circuit decision 'remands' the case back to the District Court Judge to sign and enter an Order garnting Summary Judgment to the Plaintiffs. Until that order is entered the federal exchanges are not yet abolished. As usual, RickB raises a fascinating point. Will Summary Judgment abolish the Federal Exchanges ab initio? If yes, all of the subsidies the Big Gov insurers received are no longer protected by IRS Reg, meaning at MINIMUM the subsides have unrealized tax consequences or worse, have to be repaid to the Federal Treasury. Meanwhile the Obamaniacs are telling the Big Gov insurers to keep rate increases down, and take the federal bailout instead. Realy? will the CEOs take that sweet talk to the bank? The Insurer Shareholders need to throw the senior management out, and start fresh. ObummerCare is a poisoned chalice for the Insurers.

jimmyk

It would seem odd to this non-attorney that the feds could continue to pay out money pending appeal. Once that money is out the door it's gone for good. It's like letting an execution continue even while the punishment is being appealed.

GMax

"unambiguous" language in the law per the DC Circuit panel.

hahahahahahaha

Hoist upon their own petard

jimmyk

Of course no doubt John Roberts will come to the rescue with some newfangled theory of the law.

NK(withnewsoftware)

JimmyK-- devil is in the details. As I mentioned above, the is NO judgment yet repealing the IRS Reg, so Exchange subsidies are not yet barred by Court order. Next, what will summary judgment say? are the Federal Exchanges abolished from their inception and everything they did made a nullity? If yes, the Big Gov Insurers are on the hook entirely, because it is a GIVEN that the 34 State Insurance Departments will bind the Big Gov Insurers to the Exchange policies they wrote. Obummer has been packing the DC Circuit so, an en banc appeal holds out hope for the Obamaniacs, then there is SCOTUS. This will become Roberts chance for redemption IMO. Many delicious possibilities, this has to be considered from many angles.

NK(withnewsoftware)

JimmyK@12:07 can't tell you how wrong I think you are about that.

jimmyk

What is the composition of the full 11-member DC court? I know Reid and the Dems have been trying to pack it by needlessly appointing more judges.

NK(withnewsoftware)

Clarice can probably fill us in on the current DC Circuit composition

Ignatz

--Next, what will summary judgment say? are the Federal Exchanges abolished from their inception and everything they did made a nullity?--

The issue of the Federal Exchanges' existence was not before the court.
The summary judgment is to only repeal the IRS rule expanding subsidies to the those exchanges.

--JimmyK@12:07 can't tell you how wrong I think you are about that.-

I hope you're right NK but this court refused to do precisely what Roberts' did, which was to devise an argument and language to save a statute that failed on its own statutory language.

Danube on iPad

"Will Summary Judgment abolish the Federal Exchanges ab initio?"

I would think not; it would only bar the payment of subsidies. It might depend on what relief was sought in the complaint.

I don't know the makeup of the e tite circuit court at this point, but I think this case will be decided by the Supremes. Five to four, pick 'em.

Danube on iPad

Heckuva job, Nancy!

Danube on iPad

I would imagine that the plaintiffs have submitted a form of the judgment they were seeking, and probably included it with their moving papers. Some enterprising soul may actually be able to find it.

NK(withnewsoftware)

Ignatz-- the devil is in the details and I will spend a late night tonight reading the Summary Judgment record to understand what relief will be granted. I do note that without favorable tax treatment for Federal Exchange subsidies, the Big Gov insurers wouldn't write those policies, so this ruling would take the Insurers out of those states.

Roberts-- you can disagree with what Roberts did (I happen to disagree) but you're not allowed to mischaracterize what he did. ACA Mandates was a Constitutional power cases, and the issue was did Conress have the Constitutional power to adopt the mandate? Roberts invoked an ancient SCOTUS doctrine that Congressional legislation should be saved if any Article I power supports it. Roberts made nothing up, he looked at the statute and concluded that the mandate was supported by the taxing power (but NOT the Commerce Clause.) ACA was NOT saved by interpreting the language, it was saved by Article I of the Constitution. Roberts can defend himself as a Constitutionalist. I disagree with him, but I refuse to mischaracterize what he did. Of course, Roberts now faces the test. Will he apply the words Congress itself wrote for the TAX STATUTE? As the Eagles sang, "I could be wrong... but I'm not" :)

Ignatz

Having read both opinions the majority is much more compelling.

The dissent essentially is "It can't possibly mean what it says. Does anyone really think congress would be so stupid as to write such a law?"


glasater

Now we have dueling courts.

Some Guy

"Does anyone really think congress would be so stupid as to write such a law?"


Is that a trick question?

jimmyk

I disagree with him, but I refuse to mischaracterize what he did.

This is too hair-splitting for me, but then IANAL. If you disagree with him, then you must think he made an incorrect decision. That seems like a distinction (from my 12:03) without a difference, allowing for a bit of hyperbole on my part. Calling the mandate a tax as he did was not even on the radar screen, so I don't think it's unreasonable to call it "newfangled."

NK(withnewsoftware)

DoT-- Cato's link to the Halbig Motion for Summary Judgment doesn't include the Proposed Order, but I assume it merely invalidates this Reg that entitled Federal Exchange policy holders to subsidies. The abolition of this Reg abolishes the subsidies -- are Big Gov Insurers at risk for clawbacks?:

"B. In stark contrast, the regulations promulgated by the IRS provide that a taxpayer
is eligible for a premium assistance subsidy so long as he “[i]s enrolled in one or more qualified
health plans through an Exchange,” with no qualification based on the entity that established the
Exchange. 26 C.F.R. § 1.36B-2(a)(1). The regulations then adopt a definition of “Exchange”
from HHS regulations that define it to include “State Exchanges, regional Exchanges, subsidiary
Exchanges, and a Federally-facilitated Exchange.” 26 C.F.R. § 1.36B-1(k); 45 C.F.R. § 155.20
(emphasis added). Under the regulations, therefore, an individual who enrolls in insurance even
through a federally established Exchange is eligible for a federal subsidy. The regulations, again
in contrast to the ACA, also adopt a broad definition of “coverage month,” defining it to include
any month if, “[a]s of the first day of the month, the individual is enrolled in a qualified health
plan through an Exchange” (not just a state-established one). 26 C.F.R. § 1.36B-3(c)(1)(i)."

BB Key

My favorite Steny Hoyer quote "We have a Nancy problem"

NK(withnewsoftware)

Tax Power- WAS in the Record of the ACA case and the Solicitor General argued it in their brief to SCOTUS.

Ignatz

--you're not allowed to mischaracterize what he did--

Of course I am, but of course I didn't.

The plain language of the ACA was that if one did not perform a certain act [buying insurance] one would be fined by the government for violating the law.
Roberts' rewrote, in essence, that portion of the law to define a fine as a tax to save the statutory scheme even against the government's arguments before him that it was a fine.

If a penalty is a tax then it should be deductible like any other tax, no? Penalties, even on taxes due, are not ordinarily deductible, so how can a fine for not obeying a non-tax portion of law be so redefined except by precisely the method I described?.

NK(withnewsoftware)

Ignatz-- well I did cop to being a pedantic lawyer (I know is there any other kind?)

jimmyk

Perhaps I'm misremembering, but I thought the SG argued against the tax view.

NK(withnewsoftware)

The Tax is defined by however the Congress imposes it under Article I or the 16th Amendment. It is no coincidence that in today's decision the majority opinion cites a SCOTUS TAX DECISION for the ruled of statutory construction-- i.e. plain meaning of the Congress's words. No mumbo jumbo, no coulda woulda should of. We'll see what Roberts makes of those words next June.

MarkO

How will the GOP screw this up?

Ignatz

--Perhaps I'm misremembering, but I thought the SG argued against the tax view.--

I'll avoid the dessert topping/floor wax jokes but they argued both and Roberts' accommodated them, improperly.

NK(withnewsoftware)

Good summary of the SG arguments in this link. The Penalty was NOT a tax for justicability and ripeness, but it WAS a tax for constitutional powers. So the SG argued both. The whole thing was ludicrous, that's why I disagree with Roberts ultimate ruling.. it was a pedantic bridge too far. http://www.medscape.com/viewarticle/760921

MarkO

Roberts? Vituperation. The last man who could have saved the nation from ObamaCare.

Old Lurker

And they wonder why we hate lawyers.

:-)

NK(withnewsoftware)

OL- did you see my question yesterday. Do you know anyone who lives on Colebrook Terrace, Potomac?

Porchlight

Roberts made nothing up, he looked at the statute and concluded that the mandate was supported by the taxing power (but NOT the Commerce Clause.) ACA was NOT saved by interpreting the language, it was saved by Article I of the Constitution.

But didn't the government argue explicitly before the Court that the mandate was not a tax? Why would Roberts grant them a power (to tax) that they were not seeking?

Old Lurker

Sorry NK, I missed that.

No, I don't but friends live around the corner.

jimmyk on iPad

"The Penalty was NOT a tax for justicability and ripeness, but it WAS a tax for constitutional powers. So the SG argued both."

And he wasn't laughed out of the room?

NK(withnewsoftware)

OL-- OK. The reason I ask is that my firm just hired a dirt lawyer who lives on Colebrook. DC's real estate tentacles spread to my little firm.

jimmyk on iPad

In any case, back to my 12:07 that NK so roundly disagreed with. Per NK:

" Roberts invoked an ancient SCOTUS doctrine that Congressional legislation should be saved if any Article I power supports it."

I have no great confidence that he won't do this again. Knowing that he did it before, the SG will be raring to go with an argument along those lines.

Danube on iPad

"Perhaps I'm misremembering, but I thought the SG argued against the tax view."

I seem to recall Justice Kennedy (or Alito) saying something like "you're arguing against it today, but you'll be back here tomorrow arguing for it." It's all too depressing to go look it up.

NK(withnewsoftware)

JimmyK-- many SCOTUS commentators thought it was ludicrous for the SG ro make those contradictory arguments and for that reason the Tax Power constitutionality argument should have been put to the sword. Of course I agreed with that..... but Roberts didn't.

BTW Halbig's lawyer is a law school classmate of mine. Mike Carver; Mike you may recall was the unfortunate guy who argued the first Bush v. Gore case in the Fla Supreme Court, when those justices first wandered off the reservation to re-write Fla election law. Mike was a good law school pal of Steve Miller, who's IRS Reg was just invalidated. Good job Mike... Sorry Steve.

NK(withnewsoftware)

DoT-- you remember quite well. See the 12:50 link for a contemporaneous report.

Very different issue in Halbig. Statutory Construction is the issue in Halbig. There are,as usual, two competing doctrines for Statutory Construction -- the 'plain meaning of the words' doctrine, versus, applying the words so as to implement the 'intent' of the statute and avoid 'absurd' results. Obviously 2 DC Circuit judges applied 'plain meaning' and 1 applied the vague 'intent'. I'll have to research where the 5 conservative SCOTUS Justices come out in statutory construction cases.

NK(withnewsoftware)

Carver = Carvin.

narciso

the Spice, I mean the subsidies must flow;

NK(withnewsoftware)

So say the Big Gov insurers

Rick B

"I have no great confidence that he won't do this again."

Given his demonstrated mastery of penumbral sophistry, who could be surprised if he held up an artichoke and glowingly defined it as an aardvark? That has to be preying on the thoughts of the Govins Fascists as well, as they contemplate the sharpness of the IRS claws available should a claw back become appropriate.

Danube on iPad

Seems there's a split in the circuits:

"WASHINGTON (AP) — President Barack Obama's health care law is enmeshed in another big legal battle after two federal appeals courts issued contradictory rulings on a key financing issue within hours of each other Tuesday.

"A divided court panel in Washington called into question the subsidies that help millions of low- and middle-income people pay their premiums, saying financial aid can be paid only in states that have set up their own insurance markets, or exchanges.

"About 100 miles to the south in Richmond, Virginia, another appeals court panel unanimously came to the opposite conclusion, ruling that the Internal Revenue Service correctly interpreted the will of Congress when it issued regulations allowing consumers in all 50 states to purchase subsidized coverage."

Ignatz

Let's hope President Cruz moots the point by signing Barrycare repeal in Jan 2017, before Mr. Roberts gets another crack at it.

Ignatz

--the Internal Revenue Service correctly interpreted the will of Congress--

There's a telling phrase. They didn't interpret words but will.

henry

rule of men. DOOM!

rse

Yes Iggy.

Legislative language will be ignored in favor of the gist as long as it's conducive to the judges' sense of Statist structuring of our soon-to-be cooperative commonwealth.

Where the cooperation is ensured by coercion by profs who actually write "Pray, then believe" as an appropriate tool for forcing behavioral changes.

daddy

Wolf Blitzer just asked Nabil Shaath, a a former Palestinian Foreign Minister, the following question:

Is Israel justified in trying to go into these tunnels to try to stop them from being used by Hamas fighters as a way to get into Israel and cause death and destruction?

glasater

So the commentator on CNBC said if 0 gets an enbanc review by the DC circuit and that agrees with the 4th it will not go to the Supremes.

NK(withnewsoftware)

Here's a link to a dissertation about statutry construction. BTW, why wouldn't SCOTUS take Halbig, if en banc DC Circuit reverses? http://fas.org/sgp/crs/misc/97-589.pdf

Ignatz

Well they give priority to districts with differing rulings on the same issue but it is hardly a hard and fast rule and they can take whatever they want and often do.

NK(withnewsoftware)

'Split in the circuits' is one criterion for granting SCOTUS Cert review. But, bottom line, you are correct, Cert review is whatever 4 Justices say it is. For example, sometimes Justices grant review to a decision they agree with, in the hope that affirming it reinforces the point of law.

Danube on iPad

If the en banc D.C. Circuit reverses the panel, the plaintiffs will no doubt seek to appeal the SCt, but without the split circuits it's much less likely that they'll hear it.

Ignatz

I would not discount the four guys who wanted to junk the entire thing the first time from wanting another crack at it.

Ignatz

I'm not sure I'd discount Roberts' wanting another look either.

NK(withnewsoftware)

I believe the bulk of the SCOTUS docket is federal statutory interpretation cases. Isn't this the most important statutory question out there? Four Justices wouldn't want to examine this statute and IRS Regs-- IRS-- I repeat-- IRS Regs?

Thomas Collins

I don't think SCOTUS will wade into this swamp unless there is a Circuit split. And if the Bloomberg article linked below is correct in its statement that 7 of the 11 DC Circuit judges are Dems with 4 having been appointed by Obama, today's decision will be overturned on en banc review. So I'm not too excited about the possibility of a judicial croaking of 404Care.

http://www.bloomberg.com/news/2014-07-22/obamacare-aid-for-plan-buyers-on-u-s-exchange-overturned.html

jimmyk

Is it not suspicious that the 4th Circuit comes out with a contradictory ruling literally within minutes of the DC court's decision? Or is there some convention about the 4th Tuesday in July?

Ignatz

Haven't time to read the whole 4th circuit opinion but these Allahpundit excerpts are pretty telling and enhance the odds of SCOTUS review, IMO, regardless of what the DC circuit does.

Thomas Collins

I don't think they will without a circuit split, NK, especially because this is a statutory interpretation issue. Although 404Care is of course a big news and policy matter, this case is really a technical tax case, which SCOTUS typically would not jump into without a circuit split. The fact that a decision against 404Care would create a policy minefield, in my view, makes it more likely that SCOTUS won't intervene.

In any event, of more concern to me is that the Senate and the House both rest in GOP hands, so that appropriation cutoffs to 404Care and prepaid health care reform will make it through the Senate and force Obama to veto what would most likely be legislation approved by more than 50% of the American public.

I think the best counter-argument to my position is that SCOTUS will feel the need to clarify things to clarify the administration of this health care law. But I think it is more likely that the SCOTUSes will punt.

NK(withnewsoftware)

ThomasC-- now that we've seen a DC Circuit panel refuse to defer to the tyranny of the IRS in adopting a Reg in clear contradiction of the statute (where did we hear that IRS Regs get least deference when the statutory language is involved?), and let's posit that Obummer's packed DC Circuit makes up the law and re-writes the ACA Statute, let me beg to differ with you again and say that is the exact type of case at least 4 members of SCOTUS would demand to take up. If the DC Circuit has been corrupted, then SCOTUS becomes the real authority on Federal statutory interpretation. Time will tell.

Thomas Collins

NK and Ignatz, I hope I will be eating the crow you'll no doubt be serving me if I'm wrong (as long as it's accompanied by a multi-flavored cabernet and a bottle of Bruichladdich).

NK(withnewsoftware)

ThomC-- actually, I hope a Repub Senate makes this all moot before June 2015, and we'll never find out what Congress intended, because the ACA will have been defunded and re-written.

jimmyk

NK, you'll have to remind me how an R Congress defunds something over the objection of the President. Does the Prez not have to sign a budget into law, and if he doesn't, aren't we back to continuing resolution vs. gov shutdown shenanigans, with the McCain/Lindsey ladies raising the white flag before the battle starts?

narciso

All that matters is the serf's collar, doesn't matter the color or the size;

http://therightscoop.com/whoa-halbig-ruling-a-huge-setback-to-obamacare/

NK(withnewsoftware)

Jimmy, Jimmy, Jimmy... as Red October's USS Dallas skipper commented, combat tactics are very important. Last autumn's shut down was folly and politically useless (except for Sen Cruz's fundraising) because without control of the Senate, once the Senate voted down the defund bill... nothing happened. The House passed several rational partial funding bills to fund parts of the gov't people wanted and only starve Leviathan. Reid/Senate Dems just laughed at those and ignored them -- because they could. A Repub House/Senate sends a Budget to Obummer he vetoes, and in March 2015 the Debt limit is reached and shutdown is back. Now, the Repubs get to pass partial appropriations to pay debt, Soc sec, Medicare, and Defense, and starve Leviathan. Obummer will have to veto that popular partial funding. Obummer will be the sole cause of the shutdown to save UNpopular ObummerCare. Everything changes politically. Will Repubs do this right? I have no idea -- and nobody else does either-- until a Repub Senate is elected. That's what I will contribute to (Plus Foley in Ct.).

lyle

Any of you legal eagles want to weigh in on this:

Obama administration officials said that an exchange established by the federal government was, in effect, established by a state because the secretary of health and human services was standing “in the shoes” of states when she established exchanges.

Federalism is dead because these jackholes decided it is. What are the states going to do about it?

jimmyk

Obummer will be the sole cause of the shutdown to save UNpopular ObummerCare. Everything changes politically.

Color me skeptical. The word is out, shutdowns are the fault of Rs and are bad for Rs' political fortunes.

NK(withnewsoftware)

Combat tactics are determined by doctrine and circumstances. Circumstances change, so tactics change to match new factual realities. The Doctrine is always to abolish jobs killing medicene socializing ObummerCare. The tactics depend on the circumstances. Personally, I believe a Repub Senate run by McConnell and guided by Sens Lee and Ron Johnson would get this right. No way to know for a fact until they are the majority.

daveinboca

Ali Baraka and his forty scofflaws will find a way to dodge this bullet, which is the fault of Nancy Botox and Harriet Reid for not even reading their own preposterous legislation before voting it. A Christmas Eve vote of 218-217…. That wench was on Daily Show last night and showed signs of advanced Stage 3 dementia.

henry

What are the states going to do about it?

Have their governors meet in The Octagon Iowa to see who gets next crack at the fed levers of pelf.

Danube on iPad

Hagen leads by seven in N.C.; libertarian pulling 8%.

Great.

Ignatz

If the GOP doesn't want to lose votes to libertarians they could make at least a pro forma effort to fool people into thinking they're for limited government.

Old Lurker

Bingo, Iggy. Simple as that.

narciso

hey, dave how have you been?

Danube on iPad

If the libertarians don't want a Democratic Senate they should refrain from making futile gestures.

MarkO

lyle,

When jurists lie directly to your face, they call it a "legal fiction."

The 4th Cir reasoning is almost as absurd as Roberts' meditation on the taxing power.

Threadkiller

Libertarians should shut up.

NK(withnewsoftware)

until after November....

MarkO

Libertarians should speak their minds and vote Republican in this midterm. There will be time for internecine bloodletting in 2016.

jimmyk

My prediction is that 8% will shrink dramatically if it looks close between Tillis and Hagan. Tillis seems to be quintessential GOPe, but conservatives will vote for him. Too much is at stake.

Ignatz

--If the libertarians don't want a Democratic Senate they should refrain from making futile gestures.--

Does the rudderless party of a slightly slower growing Leviathan, the Republican party, want a Democratic senate more or less than it wants to be perceived as having some principles other than not being Democrats?
Seems to me that is still an open question.

Some libertarians unfortunately have principles and even more unfortunately tend to vote for politicians with similar principles. Many of those principles used to be found in the GOP.
Seems to me the party that supposedly stands for limited government might make sure it has some appeal to libertarians some of whom used to be Republicans. In fact I'm pretty sure it's the political party that has to attract voters not vice versa.

The GOP doesn't attract voters by making their only futile gesture the middle finger to people who actually want a smaller government, not just lip service about it.

Captain Hate

If there's still a Democrat Senate after the midterms, barring 404 getting a ton of illegal immigrants voting rights, it will be nobody's fault but the GOPe. The path is clear on how to produce a landslide but they're playing Party of Stoopid games with the crony capitalists and are perpetually enamored with amnesty.

Danube on iPad

I don't understand your question, Iggy, but it does seem that you believe that if the GOP were to take positions closer to libertarian ones it would pick up libertarian votes without losing any current Republican ones. That hasn't been shown, and I doubt that it's true. You also seem to believe that libertarians have principles but Republicans do not. I don't agree.

CH, I assume you recognize that if the GOP ran a slate of candidates whose every position was endorsed by you and me (or a JOM consensus) it would poll at well under 40%.

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