Notice & Comment

The Justice Department’s New Brief in Texas v. United States

Last week, the Fifth Circuit asked the parties to Texas v. United States—the broadside challenge to the constitutionality of the Affordable Care Act—to submit letter briefs on whether anyone had standing to appeal. (Jonathan Adler has offered excellent analysis of that order here.)

Though the briefs won’t all be filed until Friday, the Justice Department submitted its brief this afternoon. In a welcome surprise, I agree with most (but not all) of it. It should lay to rest any of the Fifth Circuit’s qualms that the case is not properly before it.

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In its brief, the Department says that it’s got standing to take the appeal, even if no one else does. “[T]he government remains an appellant in this case and, critically, continues to enforce the Affordable Care Act.” Until it stops enforcing the Act, the red states and the Trump administration are at odds over the constitutionality of its continued implementation. That’s enough for a case or controversy.

Confirming the point is the Supreme Court’s decision in United States v. Windsor, the case in which the Obama administration declined to defend the Defense of Marriage Act. As the Department explains:

[H]ere, as in Windsor, the United States has both appealed that judgment and continued to enforce the statute to the detriment of the plaintiffs pending final judicial resolution of the constitutional question, even though the Executive Branch agrees with the district court’s legal conclusion. In both cases, the government’s refusal to acquiesce to the relief entered against it by the district court suffices to preserve an Article III controversy.

Significantly, the Justice Department now says that it will continue to enforce the ACA “pending a final judicial determination of the constitutionality of the individual mandate as well as the severability of the ACA’s other provisions.” Ongoing enforcement means there’s a live dispute.

I think that’s right. Not only is it consistent with Windsor, but it would avoid a very odd result. If no one could appeal, Judge O’Connor’s decision invalidating the ACA would likely remain in place—even as the Trump administration continued to interpret it as allowing for continued enforcement. But that outcome wouldn’t satisfy the red states, which seek to blow up the ACA altogether. And so the parties would still be at loggerheads, their nominal agreement on the legal questions in the case notwithstanding.

The Department also points out that it’s not in total agreement with Judge O’Connor. In a strange portion of its opening brief, it argued that parts of the ACA that didn’t directly give rise to the plaintiffs’ injuries should be sustained. The Department flagged certain anti-fraud statutes as examples, but it’s not at all clear how far that argument goes. Does it apply to the biosimilar program? Calorie-count labels in chain restaurants? The Medicaid expansion? Regardless, the point holds that the red states and the federal government disagree about how much of the ACA should be invalidated if the individual mandate is unconstitutional. That should be enough for standing.

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Because the federal government itself has standing to appeal, the Justice Department thinks it’s “immaterial” whether the House of Representatives or the blue-state coalition—both of which have intervened in the case—can also take an appeal. For now, I think that’s right.

Nonetheless, the Department offered its views, as the Fifth Circuit asked. As to the House of Representatives, the Department says that the Supreme Court’s decision in Virginia House of Delegates v. Bethune-Hill confirms that the House, as one part of a bicameral legislature, can’t sue to vindicate an injury sustained by Congress as a whole. I think that’s right, as I’ve argued before.

But who cares? Unless the blue states also lack standing, it’s irrelevant. And that’s where I think the Justice Department’s brief goes astray.

The Department says that the blue states also lack standing to appeal because nothing in O’Connor’s decision—which was a declaratory judgment, not an injunction—alters their “tangible legal rights.” In essence, the Department argues that O’Connor’s declaration that the ACA is invalid should be understood to bind only the 19 red states that brought the case, not “nonparties like the [blue] state intervenors.” As such, the blue states don’t have an interest in the case and can’t take an appeal.

That’s wrong, however. Intervention makes you a party to a lawsuit. And you’ve got a right to intervene when disposing of the case in your absence would “impair or impede” your interest in the case.

When the red states filed their complaint, they sought complete invalidation of the ACA—not just invalidation in the 19 red states. Whatever the Fifth Circuit says on appeal could determine (or at least influence) whether the red states get the relief they asked for. Indeed, because an appeals court can affirm “on any grounds supported by the record,” it’d probably be within the Fifth Circuit’s authority to interpret O’Connor’s order to apply outside the 19 red states. It’s risible to say that California is a stranger to litigation that could wipe out the ACA within its borders.

Matters might be different if the red-state plaintiffs had dropped their demand for nationwide relief. But they haven’t. (They did at one point ask O’Connor to enter red-state specific relief if he was unwilling to grant nationwide relief. But that’s not the same thing as abandoning the claim.) Matters might also be different if district courts were prohibited from granting relief that extended beyond the plaintiffs. Though I’m on record in support of such a prohibition, that’s not the world we live in.

So yes, the blue states have standing to appeal. But it shouldn’t matter. We’ve got a live case or controversy between the red states and the Trump administration over whether it should continue enforcing the ACA. That should end the matter of whether this appeal is properly before the Fifth Circuit.


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