The Obama administration won a round in the legal battle over the Patient Protection and Affordable Care Act (ACA) when a federal appeals court tossed out two lawsuits in Virginia.  The 4th U.S. Circuit Court of Appeals ruled in both lawsuits — one filed by Virginia Attorney General Kenneth Cuccinelli, the second by Liberty University – that the plaintiffs did not have legal standing to sue.  This is a rejection of the first case that ended with a ruling that the healthcare reform law was unconstitutional.  Additional cases remain active, including the lawsuit filed by 26 other states, which means that the issue has by not gone away.

Virginia argued that it had the right to challenge the individual mandate – a key proviso of the law that requires people to buy health insurance by 2014 or pay a tax penalty – because it interferes with a state law that says residents can’t be forced to purchase health insurance.  According to the court, “To permit a state to litigate whenever it enacts a statute declaring its opposition to federal law” would “convert the federal judiciary into a forum for the vindication of a state’s generalized grievances about the conduct of government.”  During oral arguments, a lawyer for the Obama administration said that the case “fails at the outset” because the mandate is applicable to individuals and not the state.  After the decision was handed down, Cuccinelli expressed “disappointment” that the case was thrown out.  According to Cuccinelli, “the Court did not even reach the merits on the key question of Virginia’s lawsuit – whether Congress has a power never before recognized in American history: the power to force one citizen to purchase a good or service from another citizen.”

In the case brought by Liberty University — a private Christian school — the court said in a 2 – 1 ruling that it was blocking the case because a federal tax law stripped it of jurisdiction to decide the issue.  The Court was the first to rule that the individual mandate is essentially a tax.  Because the mandate cannot be enforced until 2014, the Court ruled that the Anti-Injunction Act “strips us of jurisdiction” from hearing a pre-enforcement challenge.  “What the Court said is that the penalty for not complying with the mandate functions as a tax that cannot be challenged until it has been assessed,” said Kevin Walsh, a law professor at the University of Richmond School of Law.

Virginia Governor Bob McDonnell reacted to the ruling, saying “Today, a three judge panel, consisting of two judges appointed by President Barack Obama and one by former President Bill Clinton, found that Virginia lacks standing to challenge the individual mandate provision of the federal healthcare law.  We respectfully disagree with the panel’s reasoning.  To conclude that a state has no standing to challenge an expensive and burdensome federal mandate on its citizens that the state has banned in its law, might cause James Madison and George Mason, Virginia’s principal drafters of our nation’s founding documents, to promptly roll in their graves.  To dismiss a Virginia statute as a basis for standing, declaring it to be ‘quintessentially political,’ and asserting that a state cannot be a ‘constitutional watchdog’ undermines our precious principles of federalism.  This decision must be promptly appealed.

“As federal courts across the country continue to come to differing conclusions on the merits of cases arguing the unconstitutionality of the federal healthcare law, today’s decision further exemplifies why these cases should be expedited to the nation’s highest court.  It is the Supreme Court that will ultimately determine whether the federal mandate on every citizen to purchase health insurance violates the U.S. Constitution.  States and businesses continue to expend time and money and languish in uncertainty as they try to come into compliance with a law that may ultimately be ruled unconstitutional.  It is exasperating that the President and the Justice Department oppose a prompt resolution of this case through an expedited appeal.  America needs finality in this case,” according to McDonnell.

Judge Diana Gribbon Motz, who was appointed to the bench by President Clinton, wrote that the only apparent function of the state law was “to declare Virginia’s opposition to a federal insurance mandate.”  The state law was enacted just days after President Obama signed the ACA into law.

Writing in U.S. News & World Report, Scott Galupo says that “Cuccinelli and co. follow a long trail from the 18th century British jurist William Blackstone to the Dred Scott case to the New Deal to the present day.  The conservative team, at first, makes a tight, prudential case against the Obamacare mandate that I, in my nonprofessional capacity, happen to favor.”  Parsing Cuccinelli’s statement about the decision, Galupo notes that “In plainer, get-to-the-point English: We grant you the social safety net established under the ‘Roosevelt Settlement.’  We recognize Congress’s power to regulate interstate commerce.  We even grant that this power could conceivably deliver universal healthcare.  But for Pete’s sake, don’t try to include ‘inactivity’ — that is, not buying a health insurance plan on the private market — under its purview.  Because, once you regulate the act of doing nothing, what’s left to regulate?  Er, nothing.  Thus, does the state’s power to tax and police become theoretically unlimited?  But, later in the body of the piece, Team Cuccinelli begins to play other, more presently familiar cards.  Glenn Beck fans will recognize the faces in the rogue’s gallery: Justice Oliver Wendell Holmes, progressive philosopher John Dewey, and others who, this argument goes, created the post-New Deal legal and philosophical edifice.  Wouldn’t you know it, this welfare-state stuff constitutes a violation of natural law — which, ipso facto, means economic laissez-faire — and a lurch into moral chaos.  Echoing the newly popular Hayek, Cuccinelli’s article asserts the primacy of economic rights while characterizing as relativistic the not-exclusively-liberal jurisprudential argument that personhood and dignity precede the marketplace.  (Last I checked, I’ve never seen an unborn baby sign a contract.)”

The Obama administration remains optimistic about the ACA.  “When it ends, we are confident we will prevail,” White House adviser Stephanie Cutter said.