DrD

Judge Vinson declares Obamacare’s mandate unconstitutional

In American Sovereign on January 31, 2011 at 3:15 pm

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF FLORIDA

PENSACOLA DIVISION

STATE OF FLORIDA, by and through

Attorney General Pam Bondi, et al.;

Plaintiffs,

v. Case No.: 3:10-cv-91-RV/EMT

UNITED STATES DEPARTMENT OF

HEALTH AND HUMAN SERVICES, et al.,

Defendants.

____________________________________/

ORDER GRANTING SUMMARY JUDGMENT

On March 23, 2010, President Obama signed health care reform legislation:

“The Patient Protection and Affordable Care Act.” Pub. L. No. 111-148, 124 Stat.

119 (2010), as amended by the Health Care and Education Reconciliation Act of

2010, Pub. L. No. 111-152, 124 Stat. 1029 (2010) (the “Act”).

This case, challenging the Constitutionality of the Act, was filed minutes

after the President signed. It has been brought by the Attorneys General and/or

Governors of twenty-six states (the “state plaintiffs”)1; two private citizens (the

“individual plaintiffs”); and the National Federation of Independent Business

(“NFIB”) (collectively, the “plaintiffs”). The defendants are the United States

Department of Health and Human Services, the Department of Treasury, the

Department of Labor, and their secretaries (collectively, the “defendants”). I

emphasized once before, but it bears repeating again: this case is not about

1 The states are Alabama, Alaska, Arizona, Colorado, Florida, Georgia, Idaho,

Indiana, Iowa, Kansas, Louisiana, Maine, Michigan, Mississippi, Nebraska, Nevada,

North Dakota, Ohio, Pennsylvania, South Carolina, South Dakota, Texas, Utah,

Washington, Wisconsin, and Wyoming.

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whether the Act is wise or unwise legislation, or whether it will solve or exacerbate

the myriad problems in our health care system. In fact, it is not really about our

health care system at all. It is principally about our federalist system, and it raises

very important issues regarding the Constitutional role of the federal government.

James Madison, the chief architect of our federalist system, once famously

observed:

If men were angels, no government would be necessary.

If angels were to govern men, neither external nor internal

controls on government would be necessary. In framing a

government which is to be administered by men over

men, the great difficulty lies in this: you must first enable

the government to control the governed; and in the next

place oblige it to control itself.

The Federalist No. 51, at 348 (N.Y. Heritage Press ed., 1945) (“The Federalist”).2

In establishing our government, the Founders endeavored to resolve Madison’s

identified “great difficulty” by creating a system of dual sovereignty under which

“[t]he powers delegated by the proposed Constitution to the federal government

are few and defined. Those which are to remain in the State governments are

numerous and indefinite.” The Federalist No. 45, at 311 (Madison); see also U.S.

Const. art. I, § 1 (setting forth the specific legislative powers “herein granted” to

Congress). When the Bill of Rights was later added to the Constitution in 1791, the

Tenth Amendment reaffirmed that relationship: “The powers not delegated to the

United States by the Constitution, nor prohibited by it to the States, are reserved to

2 The Federalist consists of 85 articles or essays written by James Madison,

Alexander Hamilton, and John Jay, advocating for ratification of the Constitution.

“The opinion of the Federalist has always been considered as of great authority. It

is a complete commentary on our constitution; and is appealed to by all parties in

the questions to which that instrument has given birth. Its intrinsic merit entitles it

to this high rank.” Cohens v. Virginia, 19 U.S. (6 Wheat) 264, 418, 5 L. Ed. 257

(1821) (Marshall, C.J.). It will be cited to, and relied on, several times throughout

the course of this opinion.

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the States respectively, or to the people.”

The Framers believed that limiting federal power, and allowing the “residual”

power to remain in the hands of the states (and of the people), would help “ensure

protection of our fundamental liberties” and “reduce the risk of tyranny and abuse.”

See Gregory v. Ashcroft, 501 U.S. 452, 458, 111 S. Ct. 2395, 115 L. Ed. 2d 410

(1991) (citation omitted). Very early, the great Chief Justice John Marshall noted

“that those limits may not be mistaken, or forgotten, the constitution is written.”

Marbury v. Madison, 5 U.S. (1 Cranch) 137, 176, 2 L. Ed. 60 (1803). Over two

centuries later, this delicate balancing act continues. Rather than being the mere

historic relic of a bygone era, the principle behind a central government with limited

power has “never been more relevant than in this day, when accretion, if not actual

accession, of power to the federal government seems not only unavoidable, but

even expedient.” Brzonkala v. Virginia Polytechnic Institute, 169 F.3d 820, 826 (4th

Cir. 1999) (en banc), aff’d sub nom, United States v. Morrison, 529 U.S. 598, 120

S. Ct. 1740, 146 L. Ed. 2d 658 (2000).3

To say that the federal government has limited and enumerated power does

not get one far, however, for that statement is a long-recognized and well-settled

3 In United States v. Lopez, 514 U.S. 549, 115 S. Ct. 1624, 131 L. Ed. 2d

626 (1995), a watershed decision that will be discussed infra, the Supreme Court

began its analysis by referring to these limits on federal power as “first principles.”

In a manner of speaking, they may be said to be “last principles” as well, for the

Lopez Court deemed them to be so important that it also ended its opinion with a

full discussion of them. See id. at 567-68. Shortly thereafter, in United States v.

Morrison, 529 U.S. 598, 120 S. Ct. 1740, 146 L. Ed. 2d 658 (2000), which will

also be discussed infra, the Supreme Court referred to the division of authority and

limits on federal power as the “central principle of our constitutional system.” See

id. at 616 n.7. Clearly, if the modern Supreme Court regards the limits of federal

power as first, central, and last principles, those principles are profoundly important

— even in this day and age — and they must be treated accordingly in deciding this

case.

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truism. McCulloch v. Maryland, 17 U.S. (4 Wheat) 316, 405, 4 L. Ed. 579 (1819)

(“This government is acknowledged by all, to be one of enumerated powers. The

principle, that it can exercise only the powers granted to it, . . . is now universally

admitted.”) (Marshall, C.J.). The ongoing challenge is deciding whether a particular

federal law falls within or outside those powers. It is frequently a difficult task and

the subject of heated debate and strong disagreement. As Chief Justice Marshall

aptly predicted nearly 200 years ago, while everyone may agree that the federal

government is one of enumerated powers, “the question respecting the extent of

the powers actually granted, is perpetually arising, and will probably continue to

arise, so long as our system shall exist.” Id. This case presents such a question.

BACKGROUND

The background of this case — including a discussion of the original claims,

the defenses, and an overview of the relevant law — is set out in my order dated

October 14, 2010, which addressed the defendants’ motion to dismiss, and it is

incorporated herein. I will only discuss the background necessary to resolving the

case as it has been winnowed down to the two causes of action that remain.

In Count I, all of the plaintiffs challenge the “individual mandate” set forth in

Section 1501 of the Act, which, beginning in 2014 will require that everyone (with

certain limited exceptions) purchase federally-approved health insurance, or pay a

monetary penalty.4 The individual mandate allegedly violates the Commerce Clause,

4 I previously rejected the defendants’ argument that this penalty was really

a tax, and that any challenge thereto was barred by the Anti-Injunction Act. My

earlier ruling on the defendants’ tax argument is incorporated into this order and,

significantly, has the effect of focusing the issue of the individual mandate on

whether it is authorized by the Commerce Clause. To date, every court to consider

this issue (even those that have ruled in favor of the federal government) have also

rejected the tax and/or Anti-Injunction arguments. See Goudy-Bachman v. U.S.

Dep’t of Health & Human Servs., 2011 WL 223010, at *9-*12 (M.D. Pa. Jan. 24,

2011); Virginia v. Sebelius, 728 F. Supp. 2d 768, 786-88 (E.D. Va. 2010); Liberty

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which is the provision of the Constitution Congress relied on in passing it. In Count

IV, the state plaintiffs challenge the Act to the extent that it alters and amends the

Medicaid program by expanding that program, inter alia, to: (i) include individuals

under the age of 65 with incomes up to 133% of the federal poverty level, and (ii)

render the states responsible for the actual provision of health services thereunder.

This expansion of Medicaid allegedly violates the Spending Clause and principles of

federalism protected under the Ninth and Tenth Amendments. The plaintiffs seek a

declaratory judgment that the Act is unconstitutional and an injunction against its

enforcement.

These two claims are now pending on cross motions for summary judgment

(docs. 80, 82), which is a pre-trial vehicle through which a party shall prevail if the

evidence in the record “shows that there is no genuine dispute as to any material

fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56.

While the parties dispute numerous facts (primarily in the context of the Medicaid

count, noted infra), they appear to agree that disposition of this case by summary

judgment is appropriate — as the dispute ultimately comes down to, and involves,

pure issues of law. Both sides have filed strong and well researched memoranda in

support of their motions for summary judgment (“Mem.”), responses in opposition

(“Opp.”), and replies (“Reply”) in further support. I held a lengthy hearing and oral

argument on the motions December 16, 2010 (“Tr.”). In addition to this extensive

briefing by the parties, numerous organizations and individuals were granted leave

to, and did, file amicus curiae briefs (sixteen total) in support of the arguments and

claims at issue.

Univ., Inc. v. Geithner, — F. Supp. 2d —, 2010 WL 4860299, at *9-*11 (W.D. Va.

Nov. 30, 2010); U.S. Citizens Assoc. v. Sebelius, — F. Supp. 2d —, 2010 WL

4947043, at *5 (N.D. Ohio Nov. 22, 2010); Thomas More Law Center v. Obama,

720 F. Supp. 2d 882, 890-91 (E.D. Mich. 2010).

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I have carefully reviewed and considered all the foregoing materials, and now

set forth my rulings on the motions and cross-motions for summary judgment. I will

take up the plaintiffs’ two claims in reverse order.

DISCUSSION

I. Medicaid Expansion (Count Four)

For this claim, the state plaintiffs object to the fundamental and “massive”

changes in the nature and scope of the Medicaid program that the Act will bring

about. They contend that the Act violates the Spending Clause [U.S. Const. art. I,

§ 8, cl. 1] as it significantly expands and alters the Medicaid program to such an

extent they cannot afford the newly-imposed costs and burdens. They insist that

they have no choice but to remain in Medicaid as amended by the Act, which will

eventually require them to “run their budgets off a cliff.” This is alleged to violate

the Constitutional spending principles set forth in South Dakota v. Dole, 483 U.S.

203, 107 S. Ct. 2793, 97 L. Ed. 2d 171 (1987), and in other cases.5

Under Dole, there are four restrictions on Congress’ Constitutional spending

power: (1) the spending must be for the general welfare; (2) the conditions must be

stated clearly and unambiguously; (3) the conditions must bear a relationship to the

purpose of the program; and 4) the conditions imposed may not require states “to

engage in activities that would themselves be unconstitutional.” Supra, 483 U.S. at

207-10. In addition, a spending condition cannot be “coercive.” This conceptional

requirement is also from Dole, where the Supreme Court speculated (in dicta at the

end of that opinion) that “in some circumstances the financial inducement offered

by Congress might be so coercive as to pass the point at which ‘pressure turns into

5 The state plaintiffs alleged in their complaint that the Medicaid provisions

also violated the Ninth and Tenth Amendments, but those claims have not been

advanced or briefed in their summary judgment motion (except in a single passing

sentence, see Pl. Mem. at 25).

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compulsion.’” See id. at 211 (citation omitted). If that line is crossed, the Spending

Clause is violated.

Preliminarily, I note that in their complaint the state plaintiffs appear to have

relied solely on a “coercion and commandeering” theory. Nowhere in that pleading

do they allege or intimate that the Act also violates the four “general restrictions”

in Dole, nor did they make the argument in opposition to the defendants’ previous

motion to dismiss. Thus, as I stated in my earlier order after describing Dole’s four

general restrictions: “The plaintiffs do not appear to dispute that the Act meets

these restrictions. Rather, their claim is based principally on [the coercion theory].”

Apparently expanding that argument, the state plaintiffs now argue (very briefly, in

less than one full page) that the Act’s Medicaid provisions violate the four general

restrictions. See Pl. Mem. at 44-45. This belated argument is unpersuasive. The

Act plainly meets the first three of Dole’s spending restrictions, and it meets the

fourth as long as there is no other required activity that would be independently

unconstitutional. Thus, the only real issue with respect to Count IV, as framed in

the pleadings, is whether the Medicaid provisions are impermissibly coercive and

effectively commandeer the states.

The gist of this claim is that because Medicaid is the single largest federal

grant-in-aid program to the states, and because the states and the needy persons

receiving that aid have come to depend upon it, the state plaintiffs are faced with

an untenable Hobson’s Choice. They must either (1) accept the Act’s transformed

Medicaid program with its new costs and obligations, which they cannot afford, or

(2) exit the program altogether and lose the federal matching funds that are

necessary and essential to provide health care coverage to their neediest citizens

(along with other Medicaid-linked federal funds). Either way, they contend that their

state Medicaid systems will eventually collapse, leaving millions of their neediest

residents without health care. The state plaintiffs assert that they effectively have

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no choice other than to participate in the program.

In their voluminous materials filed in support of their motion for summary

judgment, the state plaintiffs have identified some serious financial and practical

problems that they are facing under the Act, especially its costs. They present a

bleak fiscal picture. At the same time, much of those facts have been disputed by

the defendants in their equally voluminous filings; and also by some of the states

appearing in the case as amici curiae, who have asserted that the Act will in the

long run save money for the states. It is simply impossible to resolve this factual

dispute now as both sides’ financial data are based on economic assumptions,

estimates, and projections many years out. In short, there are numerous genuine

disputed issues of material fact with respect to this claim that cannot be resolved

on summary judgment.6 However, even looking beyond these presently impossibleto-

resolve disputed issues of fact, there is simply no support for the state plaintiffs’

coercion argument in existing case law.

In considering this issue at the motion to dismiss stage, I noted that state

6 Perhaps anticipating this, the state plaintiffs maintained in response to the

defendants’ filings that “the entire question of whether the States’ costs might to

some extent be offset by collateral savings is legally irrelevant.” See Pl. Opp. at 29.

Thus, “even if the States were projected to achieve collateral savings, those

savings would in no way lessen the coercion and commandeering of which Plaintiff

States complain, because they would still be required to do Congress’s bidding.” Id.

at 41-42. However, it would appear from the operative complaint that the coercion

claim has always been rooted in the underlying contention that the Act forces the

states to expend resources that they cannot afford: “Plaintiff States cannot afford

the unfunded costs of participating under the Act, but effectively have no choice

other than to participate.” Second Amended Complaint at ¶ 84; see also id. at ¶ 86

(referring to the “fiscal impact” of the Medicaid expansion and explaining that it will

compel states “to assume costs they cannot afford”); id. at ¶ 41 (Act will “expand

eligibility for enrollment beyond the State’s ability to fund its participation”); id. at ¶

56 (referring to the projected billions of dollars in additional costs “stemming from

the Medicaid-related portions of the Act” which will “grow in succeeding years”);

id. at ¶ 66 (referencing the “harmful effects of the Act on [the state] fiscs”).

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participation in the Medicaid program under the Act is — as it always has been —

voluntary. This is a fundamental binary element: it either is voluntary, or it is not.

While the state plaintiffs insist that their participation is involuntary, and that they

cannot exit the program, the claim is contrary to the judicial findings in numerous

other Medicaid cases [see, e.g., Wilder v. Virginia Hosp. Assoc., 496 U.S. 498,

502, 110 S. Ct. 2510, 110 L. Ed. 2d 455 (1990) (observing that “Medicaid is a

cooperative federal-state program [and] participation in the program is voluntary”);

Florida Assoc. of Rehab. Facilities v. Florida Dep’t of Health & Rehab. Servs, 225

F.3d 1208, 1211 (11th Cir. 2000) (“No state is obligated to participate in the

Medicaid program.”); Doe v. Chiles, 136 F.3d 709, 722 (11th Cir. 1998) (Medicaid

is a program from which the state “always retains [the] option” to withdraw)], and

belied by numerous published news reports that several states (including certain of

the plaintiffs in this case) are presently considering doing exactly that. Furthermore,

two plaintiff states have acknowledged in declarations filed in support of summary

judgment that they can withdraw from the program. See Declaration of Michael J.

Willden (Director of Department of Health and Human Services, Nevada) (“Nevada

can still consider opting out of Medicaid a viable option.”); Declaration of Deborah

K. Bowman (Secretary of Department of Social Services, South Dakota) (conceding

that although it would be detrimental to its Medicaid recipients, South Dakota could

“cease participation in the Medicaid Program”). When the freedom to “opt out” of

the program is viewed in light of the fact that Congress has expressly reserved the

right to alter or amend the Medicaid program [see 42 U.S.C. § 1304 (“The right to

alter, amend, or repeal any provision of this chapter is hereby reserved to the

Congress.”)], and has done so many times over the years, I observed in my earlier

order that the plaintiffs’ argument was not strong. See Harris v. McRae, 448 U.S.

297, 301, 100 S. Ct. 2671, 65 L. Ed. 2d 784 (1980) (stating that “participation in

the Medicaid program is entirely optional, [but] once a State elects to participate, it

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must comply with the requirements”).

Indeed, a survey of the legal landscape revealed that there was “very little

support for the plaintiffs’ coercion theory argument” as every single federal Court

of Appeals called upon to consider the issue has rejected the coercion theory as a

viable claim. See, e.g., Doe v. Nebraska, 345 F.3d 593, 599-600 (8th Cir. 2003);

Kansas v. United States, 214 F.3d 1196, 1201-02 (10th Cir. 2000); California v.

United States, 104 F.3d 1086, 1092 (9th Cir. 1997); Oklahoma v. Schweiker, 655

F.2d 401, 413-14 (D.C. Cir. 1981); State of New Hampshire Dep’t of Employment

Sec. v. Marshall, 616 F.2d 240, 246 (1st Cir. 1980); but see West Virginia v. U.S.

Dep’t of Health & Human Servs., 289 F.3d 281, 288-90 (4th Cir. 2002) (referring

to a prior decision of that court, Commonwealth of Virginia Dep’t of Education v.

Riley, 106 F.3d 559 (4th Cir. 1997), where six of the thirteen judges on an en banc

panel stated in dicta that a coercion claim may be viable in that court, but going on

to note that due to “strong doubts” about the viability of the coercion theory “most

courts faced with the question have effectively abandoned any real effort to apply

the coercion theory” after finding, in essence, that it “raises political questions that

cannot be resolved by the courts”).

In the absence of an Eleventh Circuit case on point, the state plaintiffs’ claim

was “plausible” at the motion to dismiss stage. Thus, the plaintiffs were allowed to

proceed and provide evidentiary support and further legal support for a judicially

manageable standard or coherent theory for determining when, in the words of the

Supreme Court, a federal spending condition “pass[es] the point at which ‘pressure

turns into compulsion.’” See Dole, supra, 483 U.S. at 211. The evidentiary support

is substantially in dispute, as already noted, and further legal support has not been

forthcoming. It is now apparent that existing case law is inadequate to support the

state plaintiffs’ coercion claim. As the Ninth Circuit has explained in its analysis of

an earlier coercion claim made by the State of Nevada:

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We can hardly fault appellant [for not providing the court

with any principled definition of the word “coercion”]

because our own inquiry has left us with only a series of

unanswered questions. Does the relevant inquiry turn on

how high a percentage of the total programmatic funds is

lost when federal aid is cut-off? Or does it turn, as

Nevada claims in this case, on what percentage of the

federal share is withheld? Or on what percentage of the

state’s total income would be required to replace those

funds? Or on the extent to which alternative private,

state, or federal sources of . . . funding are available?

There are other interesting and more fundamental

questions. For example, should the fact that Nevada,

unlike most states, fails to impose a state income tax on

its residents play a part in our analysis? Or, to put the

question more basically, can a sovereign state which is

always free to increase its tax revenues ever be coerced

by the withholding of federal funds — or is the state

merely presented with hard political choices?

Nevada v. Skinner, 884 F.2d 445, 448 (9th Cir. 1989). It is not simply a matter of

these being generally difficult or complex questions for courts to resolve because,

as I have said, “courts deal every day with the difficult complexities of applying

Constitutional principles set forth and defined by the Supreme Court.” Rather, as

Justice Cardozo cautioned in what appears to have been the first case to hint at

the possibility of a coercion theory claim, “to hold that motive or temptation is

equivalent to coercion is to plunge the law in endless difficulties.” See Steward

Machine Co. v. Davis, 301 U.S. 548, 589-90, 57 S. Ct. 883, 81 L. Ed. 1279

(1937) (emphasis added); see also, e.g., Skinner, supra, 884 F.2d at 448 (“The

difficulty if not the impropriety of making judicial judgments regarding a state’s

financial capabilities renders the coercion theory highly suspect as a method for

resolving disputes between federal and state governments.”).

In short, while the plaintiffs’ coercion theory claim was plausible enough to

survive dismissal, upon full consideration of the relevant law and the Constitutional

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principles involved, and in light of the numerous disputed facts alluded to above, I

must conclude that this claim cannot succeed and that the defendants are entitled

to judgment as a matter of law. In so ruling, I join all courts to have considered this

issue and reached the same result, even in factual situations that involved (as here)

the potential withdrawal of a state’s entire Medicaid grant. See, e.g., Schweiker,

supra, 655 F.2d at 414 (“The courts are not suited to evaluating whether the

states are faced here with an offer they cannot refuse or merely a hard choice.”);

California, supra, 104 F.3d at 1086 (rejecting coercion theory argument based on

the claim that while the state joined Medicaid voluntarily, it had grown to depend

on federal funds and “now has no choice but to remain in the program in order to

prevent a collapse of its medical system”).

I appreciate the difficult situation in which the states find themselves. It is a

matter of historical fact that at the time the Constitution was drafted and ratified,

the Founders did not expect that the federal government would be able to provide

sizeable funding to the states and, consequently, be able to exert power over the

states to the extent that it currently does. To the contrary, it was expected that

the federal government would have limited sources of tax and tariff revenue, and

might have to be supported by the states. This reversal of roles makes any statefederal

partnership somewhat precarious given the federal government’s enormous

economic advantage. Some have suggested that, in the interest of federalism, the

Supreme Court should revisit and reconsider its Spending Clause cases. See Lynn

A. Baker, The Spending Power and the Federalist Revival, 4 Chap. L. Rev. 195-96

(2001) (maintaining the “greatest threat to state autonomy is, and has long been,

Congress’s spending power” and “the states will be at the mercy of Congress so

long as there are no meaningful limits on its spending power”). However, unless

and until that happens, the states have little recourse to remaining the very junior

partner in this partnership.

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Accordingly, summary judgment must be granted in favor of the defendants

on Count IV.

II. Individual Mandate (Count One)

For this claim, the plaintiffs contend that the individual mandate exceeds

Congress’ power under the Commerce Clause. To date, three district courts have

ruled on this issue on the merits. Two have held that the individual mandate is a

proper exercise of the commerce power [Liberty Univ., Inc. v. Geithner, — F. Supp.

2d —, 2010 WL 4860299 (W.D. Va. Nov. 30, 2010); Thomas More Law Center v.

Obama, 720 F. Supp. 2d 882 (E.D. Mich. 2010)], while the other court held that it

violates the Commerce Clause. Virginia v. Sebelius, 728 F. Supp. 2d 768 (E.D. Va.

2010).

At issue here, as in the other cases decided so far, is the assertion that the

Commerce Clause can only reach individuals and entities engaged in an “activity”;

and because the plaintiffs maintain that an individual’s failure to purchase health

insurance is, almost by definition, “inactivity,” the individual mandate goes beyond

the Commere Clause and is unconstitutional. The defendants contend that activity

is not required before Congress can exercise its Commerce Clause power, but that,

even if it is required, not having insurance constitutes activity. The defendants also

claim that the individual mandate is sustainable for the “second reason” that it falls

within the Necessary and Proper Clause.7

7 The Necessary and Proper Clause is not really a separate inquiry, but rather

is part and parcel of the Commerce Clause analysis as it augments that enumerated

power by authorizing Congress “To make all Laws which shall be necessary and

proper” to regulate interstate commerce. See, e.g., Gonzales v. Raich, 545 U.S. 1,

22, 125 S. Ct. 2195, 162 L. Ed. 2d 1 (2005); see also id. at 34-35, 39 (Scalia, J.,

concurring in judgment); accord Garcia v. Vanguard Car Rental USA, Inc., 540 F.3d

1242, 1249 (11th Cir. 2008) (the Commerce Clause power is “the combination of

the Commerce Clause per se and the Necessary and Proper Clause”). Nevertheless,

I will consider the two arguments separately for ease of analysis, and because that

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A. Standing to Challenge the Individual Mandate

Before addressing the individual mandate, I must first take up the issue of

the plaintiffs’ standing to pursue this claim. I previously held on the motion to

dismiss that the individual plaintiffs and NFIB had standing, but the defendants

have re-raised the issue on summary judgment.8

One of the individual plaintiffs, Mary Brown, has filed a declaration in which

she avers, among other things: (i) that she is a small business owner and member

of NFIB; (ii) that she does not currently have health insurance and has not had

health insurance for the past four years; (iii) that she regularly uses her personal

funds to meet her business expenses; (iv) that she is not eligible for Medicaid or

Medicare and will not be eligible in 2014; (v) that she is subject to the individual

mandate and objects to being required to comply as she does not believe the cost

of health insurance is a wise or acceptable use of her resources; (vi) that both she

and her business will be harmed if she is required to buy health insurance that she

neither wants nor needs because it will force her to divert financial resources from

her other priorities, including running her business, and doing so will “threaten my

ability to maintain my own, independent business”; (vii) that she would be forced

to reorder her personal and business affairs because, “[w]ell in advance of 2014, I

must now investigate whether and how to both obtain and maintain the required

insurance”; and lastly, (viii) that she “must also now investigate the impact” that

compliance with the individual mandate will have on her priorities and whether she

is how the defendants have framed and presented their arguments. See Def. Mem.

at 23 (contending that the individual mandate is an essential part of the regulatory

health care reform effort, and is thus “also a valid exercise of Congress’s authority

if the provision is analyzed under the Necessary and Proper Clause”).

8 It was not necessary to address standing for the Medicaid challenge as the

defendants did not dispute that the states could pursue that claim.

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can maintain her business, or whether, instead, she will have to lay off employees,

close her business, and seek employment that provides qualifying health insurance

as a benefit.

The other individual plaintiff, Kaj Ahlburg, has filed a declaration in which he

avers, inter alia: (i) that he is retired and holds no present employment; (ii) that he

has not had health care insurance for the past six years; (iii) that he has no desire

or intention to buy health insurance as he is currently, and expects to remain, able

to pay for his and his family’s own health care needs; (iv) that he is not eligible for

Medicaid or Medicare and will not be eligible in 2014; (v) that he is subject to the

individual mandate and he objects to being forced to comply with it as it does not

represent “a sensible or acceptable use of my financial resources” and will force

him “to divert funds from other priorities which I know to be more important for

myself and my family”; and (vi) that he “must now investigate” how and whether

to rearrange his finances “to ensure the availability of sufficient funds” to pay for

the required insurance premiums.

These declarations are adequate to support standing for the reasons set forth

and discussed at length in my prior opinion, which need not be repeated here in any

great detail. To establish standing to challenge a statute, a plaintiff needs to show

“a realistic danger of sustaining a direct injury as a result of the statute’s operation

or enforcement” [Babbitt v. United Farm Workers Nat’l Union, 442 U.S. 289, 298,

99 S. Ct. 2301, 60 L. Ed. 2d 895 (1979)]; that is “pegged to a sufficiently fixed

period of time” [ACLU of Florida, Inc. v. Miami-Dade County School Bd., 557 F.3d

1177, 1194 (11th Cir. 2009)]; and which is not “merely hypothetical or conjectural”

[Florida State Conference of the NAACP v. Browning, 522 F.3d 1153, 1161 (11th

Cir. 2008)]. The individual plaintiffs, Ms. Brown in particular, have established that

because of the financial expense they will definitively incur under the Act in 2014,

they are needing to take investigatory steps and make financial arrangements now

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to ensure compliance then. That is enough to show standing, as the clear majority

of district courts to consider legal challenges to the individual mandate have held.

See Goudy-Bachman v. U.S. Dep’t of Health & Human Servs., 2011 WL 223010,

at *4-*7 (M.D. Pa. Jan. 24, 2011); Liberty Univ., Inc., supra, 2010 WL 4860299,

at *5-*7; U.S. Citizens Assoc., supra, 2010 WL 4947043, at *3; Thomas More

Law Center, supra, 720 F. Supp. 2d 882, 887-89; but see Baldwin v. Sebelius,

2010 WL 3418436, at *3 (S.D. Cal. Aug. 27, 2010) (holding that plaintiff in that

case lacked standing to challenge individual mandate on the grounds that by 2014

he may have secured insurance on his own). As the District Court for the Eastern

District of Michigan properly noted in Thomas More Law Center (a case on which

the defendants heavily rely because it ultimately upheld the individual mandate):

“[T]he government is requiring plaintiffs to undertake an expenditure, for which the

government must anticipate that significant financial planning will be required. That

financial planning must take place well in advance of the actual purchase of

insurance in 2014 . . . There is nothing improbable about the contention that the

Individual Mandate is causing plaintiffs to feel economic pressure today.” Thomas

More Law Center, supra, 720 F. Supp. 2d at 889.9

Because the individual plaintiffs have demonstrated standing, including NFIB

member Mary Brown, that means (as also discussed in my earlier order) that NFIB

has associational standing as well. This leaves the question of the state plaintiffs’

standing to contest the individual mandate — an issue which was not necessary to

reach on the motion to dismiss, but which the plaintiffs request that I address now.

The state plaintiffs have raised several different grounds for standing. One of

those grounds is that some of the states have passed legislation seeking to protect

9 I note that Thomas More Law Center is on appeal to the Sixth Circuit, and

in their recently-filed appellate brief the Department of Justice has expressly

declined to challenge the district court’s conclusion that the plaintiffs had standing.

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their citizens from forced compliance with the individual mandate. For example, on

March 17, 2010, before the Act passed into law, plaintiff Idaho enacted the Idaho

Health Freedom Act, which provides in pertinent part:

(1) The power to require or regulate a person’s choice in

the mode of securing health care services, or to impose a

penalty related thereto, is not found in the Constitution of

the United States of America, and is therefore a power

reserved to the people pursuant to the Ninth Amendment,

and to the several states pursuant to the Tenth

Amendment. The state of Idaho hereby exercises its

sovereign power to declare the public policy of the state

of Idaho regarding the right of all persons residing in the

state of Idaho in choosing the mode of securing health

care services free from the imposition of penalties, or the

threat thereof, by the federal government of the United

States of America relating thereto.

(2) It is hereby declared that . . . every person within the

state of Idaho is and shall be free to choose or decline to

choose any mode of securing health care services

without penalty or threat of penalty by the federal

government of the United States of America.

I.C. § 39-9003 (2010).

Similarly, on March 22, 2010, also before the Act became law, Utah passed

legislation declaring that the then-pending federal government proposals for health

care reform “infringe on state powers” and “infringe on the rights of citizens of this

state to provide for their own health care” by “requiring a person to enroll in a third

party payment system” and “imposing fines on a person who chooses to pay

directly for health care rather than use a third party payer.” See generally U.C.A.

1953 § 63M-1-2505.5.

Judge Henry Hudson considered similar legislation in one of the two Virginia

cases. After engaging in a lengthy analysis and full discussion of the applicable law

[see generally Virginia v. Sebelius, 702 F. Supp. 2d 598, 602-07 (E.D. Va. 2010)],

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he concluded that despite the statute’s declaratory nature, the Commonwealth had

adequate standing to bring the suit insofar as “[t]he mere existence of the lawfullyenacted

statue is sufficient to trigger the duty of the Attorney General of Virginia to

defend the law and the associated sovereign power to enact it.” See id. at 605-06.

I agree with Judge Hudson’s thoughtful analysis of the issue and adopt it here. The

States of Idaho and Utah, through plaintiff Attorneys General Lawrence G. Wasden

and Mark L. Shurtleff, have standing to prosecute this case based on statutes duly

passed by their legislatures, and signed into law by their Governors.10

In sum, the two individual plaintiffs (Brown and Ahlburg), the association

(NFIB), and at least two of the states (Idaho and Utah) have standing to challenge

the individual mandate. This eliminates the need to discuss the standing issue with

respect to the other state plaintiffs, or the other asserted bases for standing. See

Watt v. Energy Action Educ. Found., 454 U.S. 151, 160, 102 S. Ct. 205, 70 L.

Ed. 2d 309 (1981) (“Because we find California has standing, we do not consider

the standing of the other plaintiffs.”); Village of Arlington Heights v. Metropolitan

Housing Dev. Corp., 429 U.S. 252, 264 n.9, 97 S. Ct. 555, 50 L. Ed. 2d 450

(1977) (“Because of the presence of this plaintiff, we need not consider whether

the other individual and corporate plaintiffs have standing to maintain this suit.”);

see also Mountain States Legal Foundation v. Glickman, 92 F.3d 1228, 1232 (D.C.

Cir. 1996) (if standing is shown for at least one plaintiff with respect to each claim,

“we need not consider the standing of the other plaintiffs to raise that claim”).

Having reaffirmed that the plaintiffs have adequate standing to challenge the

individual mandate, I will consider whether that provision is an appropriate exercise

of power under the Commerce Clause, and, if not, whether it is sustainable under

10 I note that several other plaintiff states passed similar laws after the Act

became law and during the pendency of this litigation. Other states have similar

laws still pending in their state legislatures.

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the Necessary and Proper Clause. The Constitutionality of the individual mandate is

the crux of this entire case.

B. Analysis

(1) The Commerce Clause

The current state of Commerce Clause law has been summarized and defined

by the Supreme Court on several occasions:

[W]e have identified three broad categories of activity

that Congress may regulate under its commerce power.

First, Congress may regulate the use of the channels of

interstate commerce. Second, Congress is empowered to

regulate and protect the instrumentalities of interstate

commerce, or persons or things in interstate commerce,

even though the threat may come only from intrastate

activities. Finally, Congress’ commerce authority includes

the power to regulate those activities having a substantial

relation to interstate commerce, i.e., those activities that

substantially affect interstate commerce.

United States v. Lopez, 514 U.S. 549, 558-59, 115 S. Ct. 1624, 131 L. Ed. 2d

626 (1995) (citations omitted); accord United States v. Morrison, 529 U.S. 598,

608-09, 120 S. Ct. 1740, 146 L. Ed. 2d 658 (2000); see also Hodel v. Virginia

Surface Min. & Reclamation Assoc., Inc., 452 U.S. 264, 276-77, 101 S. Ct. 2352,

69 L. Ed. 2d 1 (1981); Perez v. United States, 402 U.S. 146, 150, 91 S. Ct. 1357,

28 L. Ed. 2d 686 (1971). It is thus well settled that Congress has the authority

under the Commerce Clause to regulate three — and only three — “categories of

activity.” Lopez, supra, 514 U.S. at 558; see also, e.g., Garcia v. Vanguard Car

Rental USA, Inc., 540 F.3d 1242, 1249-51 (11th Cir. 2008) (discussing in detail

the “three categories of activities” that Congress can regulate); United States v.

Maxwell, 446 F.3d 1210, 1212 (11th Cir. 2006) (noting that, “to date,“ Congress

can regulate only “three categories of activities”). The third category is the one at

issue in this case.

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As will be seen, the “substantially affects” category is the most frequently

disputed and “most hotly contested facet of the commerce power.” Garcia, supra,

540 F.3d at 1250. This is because, while under the first two categories Congress

may regulate and protect actual interstate commerce,

the third allows Congress to regulate intrastate

noncommercial activity, based on its effects.

Consideration of effects necessarily involves matters of

degree [and] thus poses not two hazards, like Scylla and

Charybdis, but three. If we entertain too expansive an

understanding of effects, the Constitution’s enumeration

of powers becomes meaningless and federal power

becomes effectively limitless. If we entertain too narrow

an understanding, Congress is stripped of its enumerated

power, reinforced by the Necessary and Proper Clause, to

protect and control commerce among the several states.

If we employ too nebulous a standard, we exacerbate the

risk that judges will substitute their own subjective or

political calculus for that of the elected representatives of

the people, or will appear to be doing so.

United States v. Patton, 451 F.3d 615, 622-23 (10th Cir. 2006). Before attempting

to navigate among these three “hazards,” a full review of the historical roots of the

commerce power, and a discussion of how we got to where we are today, may be

instructive.

(a) The Commerce Clause in its Historical Context

Chief Justice Marshall wrote in 1824, in the first ever Commerce Clause

case to reach the Supreme Court:

As men, whose intentions require no concealment,

generally employ the words which most directly and aptly

express the ideas they intend to convey, the enlightened

patriots who framed our constitution, and the people who

adopted it, must be understood to have employed words

in their natural sense, and to have intended what they

have said.

Gibbons v. Ogden, 22 U.S. (9 Wheat.) 1, 188, 6 L. Ed. 23 (1824). Justice Marshall

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continued his opinion by noting that if, “from the imperfection of human language,”

there are doubts as to the extent of any power authorized under the Constitution,

the underlying object or purpose for which that power was granted “should have

great influence in the construction.” Id. at 188-89. In other words, in determining

the full extent of any granted power, it may be helpful to not only focus on what

the Constitution says (i.e., the actual language used), but also why it says what it

says (i.e., the problem or issue it was designed to address). Both will be discussed

in turn.

The Commerce Clause is a mere sixteen words long, and it provides that

Congress shall have the power:

To regulate Commerce with foreign Nations, and among

the several States, and with the Indian Tribes.

U.S. Const. art I, § 8, cl. 3. For purposes of this case, only seven words are

relevant: “To regulate Commerce . . . among the several States.” There is

considerable historical evidence that in the early years of the Union, the word

“commerce” was understood to encompass trade, and the intercourse, traffic, or

exchange of goods; in short, “the activities of buying and selling that come after

production and before the goods come to rest.” Robert H. Bork & Daniel E. Troy,

Locating the Boundaries: The Scope of Congress’s Power to Regulate Commerce,

25 Harv. J. L. & Pub. Pol’y 849, 861-62 (2002) (“Bork & Troy”) (citing, inter alia,

dictionaries from that time which defined commerce as “exchange of one thing for

another”). In a frequently cited law review article, one Constitutional scholar has

painstakingly tallied each appearance of the word “commerce” in Madison’s notes

on the Constitutional Convention and in The Federalist, and discovered that in none

of the ninety-seven appearances of that term is it ever used to refer unambiguously

to activity beyond trade or exchange. See Randy E. Barnett, The Original Meaning

of the Commerce Clause, 68 U. Chi. L. Rev. 101, 114-16 (2001) (“Barnett”); see

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also id. at 116 (further examining each and every use of the word that appeared in

the state ratification convention reports and finding “the term was uniformly used

to refer to trade or exchange”). Even a Constitutional scholar who has argued for

an expansive interpretation of the Commerce Clause (and, in fact, has been cited

to, and relied on, by the defendants in this case) has acknowledged that when the

Constitution was drafted and ratified, commerce “was the practical equivalent of

the word ‘trade.’” See Robert L. Stern, That Commerce Which Concerns More

States than One, 47 Harv. L. Rev. 1335, 1346 (1934) (“Stern”).

The Supreme Court’s first description of commerce (and still the most widely

accepted) is from Gibbons v. Ogden, supra, which involved a New York law that

sought to limit the navigable waters within the jurisdiction of that state. In holding

that “commerce” comprehended navigation, and thus it fell within the reach of the

Commerce Clause, Chief Justice Marshall explained that “Commerce, undoubtedly,

is traffic, but it is something more: it is intercourse. It describes the commercial

intercourse between nations, and parts of nations, in all its branches, and is

regulated by prescribing rules for carrying on that intercourse.” 22 U.S. at 72. This

definition is consistent with accepted dictionary definitions of the Founders’ time.

See 1 Samuel Johnson, A Dictionary of the English Language (4th ed. 1773)

(commerce defined as “Intercourse; exchange of one thing for another; interchange

of any thing; trade; traffick”). And it remained a good definition of the Supreme

Court’s Commerce Clause interpretation throughout the Nineteenth Century. See,

e.g., Kidd v. Pearson, 128 U.S. 1, 20-21, 9 S. Ct. 6, 32 L. Ed. 346 (1888) (“The

legal definition of the term [commerce] . . . consists in intercourse and traffic,

including in these terms navigation and the transportation and transit of persons

and property, as well as the purchase, sale, and exchange of commodities”). As

Alexander Hamilton intimated in The Federalist, however, it did not at that time

encompass manufacturing or agriculture. See The Federalist No. 34, at 212-13

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(noting that the “encouragement of agriculture and manufactures” was to remain

an object of state expenditure). This interpretation of commerce as being primarily

concerned with the commercial intercourse associated with the trade or exchange

of goods and commodities is consistent with the original purpose of the Commerce

Clause (discussed immediately below), which is entitled to “great influence in [its]

construction.” See Gibbons, supra, 22 U.S. at 188-89.11

There is no doubt historically that the primary purpose behind the Commerce

Clause was to give Congress power to regulate commerce so that it could eliminate

the trade restrictions and barriers by and between the states that had existed under

the Articles of Confederation. Such obstructions to commerce were destructive to

the Union and believed to be precursors to war. The Supreme Court has explained

this rationale:

When victory relieved the Colonies from the pressure for

solidarity that war had exerted, a drift toward anarchy

11 As an historical aside, I note that pursuant to this original understanding

and interpretation of “commerce,” insurance contracts did not qualify because

“[i]ssuing a policy of insurance is not a transaction of commerce.” Paul v. Virginia,

75 U.S. (8 Wall.) 168, 183, 19 L. Ed. 357 (1868) (further explaining that insurance

contracts “are not articles of commerce in any proper meaning of the word” as

they are not objects “of trade and barter,” nor are they “commodities to be shipped

or forwarded from one State to another, and then put up for sale”). That changed

in 1944, when the Supreme Court held that Congress could regulate the insurance

business under the Commerce Clause. United States v. South-Eastern Underwriters

Assoc., 322 U.S. 533, 64 S. Ct. 1162, 88 L. Ed. 1440 (1944). “Concerned that

[this] decision might undermine state efforts to regulate insurance, Congress in

1945 enacted the McCarran-Ferguson Act. Section 1 of the Act provides that

‘continued regulation and taxation by the several States of the business of

insurance is in the public interest,’ and that ‘silence on the part of the Congress

shall not be construed to impose any barrier to the regulation or taxation of such

business by the several States.’” Humana Inc. v. Forsyth, 525 U.S. 299, 306, 119

S. Ct. 710, 142 L. Ed.2d 753 (1999) (quoting 15 U.S.C. § 1011). Thus, ever since

passage of the McCarran-Ferguson Act, the insurance business has continued to be

regulated almost exclusively by the states.

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and commercial warfare between states began . . . [E]ach

state would legislate according to its estimate of its own

interests, the importance of its own products, and the

local advantages or disadvantages of its position in a

political or commercial view. This came to threaten at

once the peace and safety of the Union. The sole purpose

for which Virginia initiated the movement which

ultimately produced the Constitution was to take into

consideration the trade of the United States; to examine

the relative situations and trade of the said states; to

consider how far a uniform system in their commercial

regulation may be necessary to their common interest and

their permanent harmony and for that purpose the

General Assembly of Virginia in January of 1786 named

commissioners and proposed their meeting with those

from other states.

The desire of the Forefathers to federalize regulation of

foreign and interstate commerce stands in sharp contrast

to their jealous preservation of power over their internal

affairs. No other federal power was so universally

assumed to be necessary, no other state power was so

readily relin[q]uished. There was no desire to authorize

federal interference with social conditions or legal

institutions of the states. Even the Bill of Rights

amendments were framed only as a limitation upon the

powers of Congress. The states were quite content with

their several and diverse controls over most matters but,

as Madison has indicated, “want of a general power over

Commerce led to an exercise of this power separately, by

the States, which not only proved abortive, but

engendered rival, conflicting and angry regulations.”

H.P. Hood & Sons, Inc. v. Du Mond, 336 U.S. 525, 533-34, 69 S. Ct. 657, 93 L.

Ed. 865 (1949) (citations and quotations omitted). The foregoing is a frequently

repeated history lesson from the Supreme Court. In his concurring opinion in the

landmark 1824 case of Gibbons v. Ogden, supra, for example, Justice Johnson

provided a similar historical summary:

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For a century the States [as British colonies] had

submitted, with murmurs, to the commercial restrictions

imposed by the parent State; and now, finding

themselves in the unlimited possession of those powers

over their own commerce, which they had so long been

deprived of, and so earnestly coveted, that selfish

principle which, well controlled, is so salutary, and which,

unrestricted, is so unjust and tyrannical, guided by

inexperience and jealousy, began to show itself in

iniquitous laws and impolitic measures, from which grew

up a conflict of commercial regulations, destructive to the

harmony of the States, and fatal to their commercial

interests abroad.

This was the immediate cause, that led to the forming of

a convention.

Gibbons, supra, 22 U.S. at 224. In the Supreme Court’s 1888 decision in Kidd v.

Pearson, Justice Lamar noted that “it is a matter of public history that the object of

vesting in congress the power to regulate commerce . . . among the several states

was to insure uniformity for regulation against conflicting and discriminatory state

legislation.” See Kidd, supra, 128 U.S. at 21. More recently, Justice Stevens has

advised that when “construing the scope of the power granted to Congress by the

Commerce Clause . . . [i]t is important to remember that this clause was the

Framers’ response to the central problem that gave rise to the Constitution itself,”

that is, the Founders had “‘set out only to find a way to reduce trade restrictions.’”

See EEOC v. Wyoming, 460 U.S. 226, 244-45, 103 S. Ct. 1054, 75 L. Ed. 2d 18

(1983) (Stevens, J., concurring). The foregoing history is so “widely shared,” [see

id. at 245 n.1], that Constitutional scholars with opposing views on the Commerce

Clause readily agree on this point. Compare Stern, supra, at 1344 (“There can be

no question, of course, that in 1787 [when] the framers and ratifiers of the

Constitution . . . considered the need for regulating ‘commerce with foreign nations

and among the several states,’ they were thinking only in terms of . . . the removal

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of barriers obstructing the physical movements of goods across state lines.”), with

Bork & Troy, supra, at 858, 865 (“One thing is certain: the Founders turned to a

federal commerce power to carve stability out of this commercial anarchy” and

“keep the States from treating one another as hostile foreign powers”; in short,

“the Clause was drafted to grant Congress the power to craft a coherent national

trade policy, to restore and maintain viable trade among the states, and to prevent

interstate war.”). Hamilton and Madison both shared this concern that conflicting

and discriminatory state trade legislation “would naturally lead to outrages, and

these to reprisals and wars.” The Federalist No. 7, at 37 (Hamilton); see also The

Federalist No. 42, at 282 (Madison) (referencing the “unceasing animosities” and

“serious interruptions of the public tranquility” that would inevitably flow from the

lack of national commerce power).

To acknowledge the foregoing historical facts is not necessarily to say that

the power under the Commerce Clause was intended to (and must) remain limited

to the trade or exchange of goods, and be confined to the task of eliminating trade

barriers erected by and between the states.12 The drafters of the Constitution were

aware that they were preparing an instrument for the ages, not one suited only for

the exigencies of that particular time. See, e.g., McCulloch, supra, 17 U.S. at 415

(the Constitution was “intended to endure for ages to come” and “to be adapted to

the various crises of human affairs”) (Marshall, C.J.); Weems v. United States, 217

U.S. 349, 373, 30 S. Ct. 544, 54 L. Ed. 793 (1910) (explaining that constitutions

12 Although there is some evidence that is exactly what Madison, at least,

had intended. In one of his letters, he wrote that the Commerce Clause “‘grew out

of the abuse of the power by the importing States in taxing the non-importing, and

was intended as a negative and preventive provision against injustice among the

States themselves, rather than as a power to be used for the positive purposes of

the General Government.’” West Lynn Creamery, Inc. v. Healy, 512 U.S. 186, 193

n.9, 114 S. Ct. 2205, 129 L. Ed. 2d 157 (1994) (quoting 3 M. Farrand, Records of

the Federal Convention of 1787, p. 478 (1911)).

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“are not ephemeral enactments, designed to meet passing occasions,” but rather

are “designed to approach immortality as nearly as human institutions can approach

it . . . [and], therefore, our contemplation cannot be only of what has been, but of

what may be”); accord New York v. United States, 505 U.S. 144, 157, 112 S. Ct.

2408, 120 L. Ed. 2d 120 (1992) (the Constitution was “phrased in language broad

enough to allow for the expansion” of federal power and allow “enormous changes

in the nature of government”). As Hamilton explained:

Constitutions of civil government are not to be framed

upon a calculation of existing exigencies, but upon a

combination of these with the probable exigencies of

ages, according to the natural and tried course of human

affairs. Nothing, therefore, can be more fallacious than to

infer the extent of any power, proper to be lodged in the

national government, from an estimate of its immediate

necessities. There ought to be a capacity to provide for

future contingencies as they may happen; and as these

are illimitable in their nature, it is impossible safely to limit

that capacity.

The Federalist No. 34, at 210-11 (emphasis in original).

Thus, the exercise and interpretation of the commerce power has evolved

and undergone a significant change “as the needs of a dynamic and constantly

expanding national economy have changed.” See EEOC, supra, 460 U.S. at 246

(Stevens, J., concurring). But, I will begin at the beginning.

(b) Evolution of Commerce Clause Jurisprudence

Some have maintained that the Commerce Clause power began as, and was

intended to remain, a narrow and limited one. See, e.g., Raoul Berger, Federalism:

The Founders Design (1987) (arguing that the founders sought to create a limited

federal government whose power, including the commerce power, was narrow in

scope); Barnett, supra, at 146 (concluding that “the most persuasive evidence of

original meaning . . . strongly supports [the] narrow interpretation of Congress’s

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power [under the Commerce Clause]”). Despite evidence to support this position, it

is difficult to prove decisively because for the first century of our history the Clause

was seldom invoked by Congress (if at all), and then only negatively to prevent the

interference with commerce by individual states. This necessarily means that there

is a lack of early congressional and judicial pronouncements on the subject. This, in

turn, makes it harder to conclusively determine how far the commerce power was

originally intended to reach. It was not until 1824 (more than three decades after

ratification) that the Supreme Court was first called upon in Gibbons v. Ogden to

consider the commerce power. By that time, it would appear that the Clause was

given a rather expansive treatment by Chief Justice Marshall, who wrote:

[The commerce power] is the power to regulate; that is,

to prescribe the rule by which commerce is to be

governed. This power, like all others vested in Congress,

is complete in itself, may be exercised to its utmost

extent, and acknowledges no limitations, other than are

prescribed in the constitution . . . If, as has always been

understood, the sovereignty of Congress, though limited

to specified objects, is plenary as to those objects, the

power over commerce with foreign nations, and among

the several States, is vested in Congress as absolutely as

it would be in a single government, having in its

constitution the same restrictions on the exercise of the

power as are found in the constitution of the United

States. The wisdom and the discretion of Congress, their

identity with the people, and the influence which their

constituents possess at elections, are, in this, as in many

other instances . . . the sole restraints on which they

have relied, to secure them from its abuse.

Gibbons, supra, 22 U.S. at 75. Notwithstanding this seemingly broad interpretation

of Congress’ power to negate New York’s assertion of authority over its navigable

waters, it was not until 1887, one hundred years after ratification, that Congress

first exercised its power to affirmatively and positively regulate commerce among

the states. And when it did, the Supreme Court at that time rejected the broad

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conception of commerce and the power of Congress to regulate the economy was

sharply restricted. See, e.g., Kidd v. Pearson, supra (1888). Thus, for most of the

first century and a half of Constitutional government (with the possible exception

of Gibbons v. Ogden in 1824), the Clause was narrowly construed and given

“miserly construction.” See EEOC, supra, 460 U.S. at 246 (Stevens, J., concurring)

(citing Kidd, supra, 128 U.S. at 20-21 (manufacturing not subject to the commerce

power of Congress); United States v. E.C. Knight Co., 156 U.S. 1, 12-16, 15 S.

Ct. 249, 39 L. Ed. 325 (1895) (manufacturing monopoly not subject to commerce

power); Adair v. United States, 208 U.S. 161, 178-179, 28 S. Ct. 277, 52 L. Ed.

436 (1908) (connection between interstate commerce and membership in a labor

union insufficient to authorize Congress to make it a crime for an interstate carrier

to fire employee for his union membership); Hammer v. Dagenhart, 247 U.S. 251,

276, 38 S. Ct. 529, 62 L. Ed. 1101 (1918) (Congress without power to prohibit

the interstate transportation of goods produced with child labor); Carter v. Carter

Coal Co., 298 U.S. 238, 298, 308-10, 56 S. Ct. 855, 80 L. Ed. 1160 (1936)

(holding that commerce power does not extend to the regulation of wages, hours,

and working conditions of coal miners; defining commerce — consistent with the

original understanding of the term — as “the equivalent of the phrase ‘intercourse

for the purposes of trade’”)).

For example, in A.L.A. Schechter Poultry Corp. v. United States, 295 U.S.

495, 55 S. Ct. 837, 79 L. Ed. 1570 (1935), a case well known to first year law

students, the Court invalidated regulations fixing employee hours and wages in an

intrastate business because the activity being regulated only related to interstate

commerce “indirectly.” The Supreme Court characterized the distinction between

“direct” and “indirect” effects on interstate commerce as “a fundamental one,

essential to the maintenance of our constitutional system,” for without it “there

would be virtually no limit to the federal power and for all practical purposes we

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should have a completely centralized government.” Id. at 548.

But, everything changed in 1937, beginning with the first of three significant

New Deal cases. In N.L.R.B. v. Jones & Laughlin Steel Corp., 301 U.S. 1, 57 S. Ct.

615, 81 L. Ed. 893 (1937), the Supreme Court, after recognizing the well known

principle “that acts which directly burden or obstruct interstate or foreign

commerce, or its free flow, are within the reach of the congressional power” [see

id. at 31], held for the first time that Congress could also regulate purely intrastate

activities that could be said to have a “substantial effect” on interstate commerce.

“Although activities may be intrastate in character when separately considered, if

they have such a close and substantial relation to interstate commerce that their

control is essential or appropriate to protect that commerce from burdens and

obstructions, Congress cannot be denied the power to exercise that control.” Id. at

37. The question was now “the effect upon interstate commerce of the [intrastate

activity] involved.” Id. at 40 (emphasis added).

Four years later, in United States v. Darby, 312 U.S. 100, 61 S. Ct. 451, 85

L. Ed. 609 (1941), the Supreme Court overruled Hammer v. Dagenhart, supra. In

upholding the wage and hour requirements in the Fair Labor Standards Act, and its

suppression of substandard labor conditions, the Court reaffirmed that with respect

to intrastate “transactions” and “activities” having a substantial effect on interstate

commerce, Congress may regulate them without doing violence to the Constitution.

See id. at 118-23.

And then came Wickard v. Filburn, 317 U.S. 111, 63 S. Ct. 82, 87 L. Ed.

122 (1942), which, until recently, was widely considered the most far-reaching

expansion of Commerce Clause regulatory authority over intrastate activity. At

issue in Wickard were amendments to the Agricultural Adjustment Act of 1938

that set acreage allotments for wheat farmers in an effort to control supply and

avoid surpluses that could result in abnormally low wheat prices. The plaintiff in

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that case, Roscoe Filburn, owned a small farm on which he raised and harvested

wheat, among other things. When he exceeded his allotment by 12 acres (which

yielded 239 bushels of wheat), he was penalized under the statute. Although the

intended disposition of the crop involved in the case was not “expressly stated,”

[id. at 114], the Supreme Court assumed and analyzed the issue as though the

excess wheat was “not intended in any part for commerce but wholly for

consumption on the farm.” See id. at 118. Even though production of such wheat

“may not be regarded as commerce” in the strictest sense of the word, [see id. at

125], consumption on the farm satisfied needs that would (theoretically, at least)

be otherwise filled by another purchase or commercial transaction. See id. at 128

(explaining that homegrown wheat “supplies a need of the man who grew it which

would otherwise be reflected by purchases in the open market [and] in this sense

competes with wheat in commerce”). In holding that Congress had power under

the Commerce Clause to regulate production intended for personal consumption,

the Supreme Court stated:

[E]ven if appellee’s activity be local and though it may not

be regarded as commerce, it may still, whatever its

nature, be reached by Congress if it exerts a substantial

economic effect on interstate commerce and this

irrespective of whether such effect is what might at some

earlier time have been defined as “direct” or “indirect.”

* * *

That appellee’s own contribution to the demand for

wheat may be trivial by itself is not enough to remove

him from the scope of federal regulation where, as here,

his contribution, taken together with that of many others

similarly situated, is far from trivial.

Id. at 125, 127-28. The latter statement is commonly known and described as the

“aggregation principle.” It allows Congress under the Commerce Clause to reach a

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“class of activities” that have a substantial impact on interstate commerce when

those activities are aggregated with all similar and related activities — even though

the activities within the class may be themselves trivial and insignificant. See, e.g.,

Maryland v. Wirtz, 392 U.S. 183, 192-93, 196 n.27, 88 S. Ct. 2017, 20 L. Ed. 2d

1020 (1968) (any claim that reviewing courts have the power to excise, as trivial,

individual activity within a broader class of activities “has been put entirely to rest”

as the “de minimis character of individual instances arising under [the] statute is of

no consequence”). To illustrate this principle, as applied in Wickard, even though

Filburn’s 239 bushels were presumably for his own consumption and seed, and did

not significantly impact interstate commerce, if every farmer in the country did the

same thing, the aggregate impact on commerce would be cumulatively substantial.

Together, Jones & Laughlin Steel, Darby, and Wickard either “ushered in” a

new era of Commerce Clause jurisprudence “that greatly expanded the previously

defined authority of Congress under that Clause” [Lopez, supra, 514 U.S. at 556],

or they merely “restored” the “broader view of the Commerce Clause announced

by Chief Justice Marshall.” Perez, supra, 402 U.S. at 151. Regardless of whether

the cases represented a new era or simply a restoration of the old, it seemed that

from that point forward congressional action under the Commerce Clause was to

be given virtually insurmountable deference. See Kenneth Klukowski, Citizen Gun

Rights: Incorporating the Second Amendment Through the Privileges or Immunities

Clause, 39 N.M. L. Rev. 195, 232-33 (2009) (noting that in these New Deal cases

“the Court read the Commerce Clause so broadly that it is a bold statement to say

that the provision even nominally constrained federal action”). And, indeed, from

the New Deal period through the next five decades, not a single federal legislative

enactment was struck down as exceeding Congress’ power under the Commerce

Clause power — until Lopez in 1995.

In United States v. Lopez the Supreme Court considered the Constitutionality

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of the Gun Free School Zones Act of 1990, which criminalized the possession of a

firearm in a school zone. In holding that the statute exceeded Congress’ authority

under the Commerce Clause, the Supreme Court began by recognizing the “first

principles” behind the limitations on federal power as set forth in the Constitution.

See supra, 514 U.S. at 552. Then, after detailing the history and transformation of

Commerce Clause jurisprudence — from Gibbons, to A.L.A. Schechter Poultry, and

up through Wickard — the Court observed that even in cases which had interpreted

the Commerce Clause more expansively, every decision to date had recognized that

the power granted by the Clause is necessarily “subject to outer limits” which, if

not recognized and respected, could lead to federal action that would “effectually

obliterate the distinction between what is national and what is local and create a

completely centralized government.” See generally id. at 553-57. Consistent with

those limits, the Lopez Court stated “we have identified three broad categories of

activity that Congress may regulate under its commerce power.” See id. at 558

(emphasis added). The “substantially affects” category was the one at issue there,

and in holding that the statute did not pass muster thereunder, the Supreme Court

focused on four considerations: (i) the activity being regulated (guns near schools)

was not economic in nature; (ii) the statute did not contain jurisdictionally limiting

language; (iii) Congress did not make any formal findings concerning the effect of

the regulated activity on commerce; and (iv) the connection between that activity

and its effect on commerce was attenuated. See generally id. at 559-67.

As for the fourth consideration, the Court impliedly conceded the claims by

the government and the dissent that: (1) gun-related violence is a serious national

problem with substantial costs that are spread throughout the population; (2) such

violence has adverse effects on classroom learning (which can result in decreased

productivity) and discourages traveling into areas felt to be unsafe; all of which, in

turn, (3) represents a substantial threat to interstate commerce. The Lopez majority

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made a point to “pause to consider the implications” of such arguments, however.

See id. at 563-65. It found that if such theories were sufficient to justify regulation

under the Commerce clause (even though their underlying logic and truth were not

questioned), “it is difficult to perceive any limitation on federal power” and “we are

hard pressed to posit any activity by an individual that Congress is without power

to regulate.” See id. at 564. To accept such arguments and uphold the statute, the

majority concluded, would require the Court:

. . . to pile inference upon inference in a manner that

would bid fair to convert congressional authority under

the Commerce Clause to a general police power of the

sort retained by the States. Admittedly, some of our prior

cases have taken long steps down that road, giving great

deference to congressional action. The broad language in

these opinions has suggested the possibility of additional

expansion, but we decline here to proceed any further. To

do so would require us to conclude that the

Constitution’s enumeration of powers does not

presuppose something not enumerated, and that there

never will be a distinction between what is truly national

and what is truly local. This we are unwilling to do.

Id. at 567-68; see also id. at 578, 580 (explaining that it is the Court’s duty to

“recognize meaningful limits on the commerce power” and intervene if Congress

“has tipped the scales too far” as federal balance “is too essential a part of our

constitutional structure and plays too vital a role in securing freedom”) (Kennedy,

J., concurring) .

The next significant Commerce Clause case to be decided by the Supreme

Court was the 2000 case of United States v. Morrison, supra, 529 U.S. at 598,

which involved a challenge to the Violence Against Women Act of 1994. The

government argued in that case — similar to what it did in Lopez — that Congress

could regulate gender-motivated violence based on a syllogistic theory that victims

of such violence are deterred from traveling and engaging in interstate business or

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employment; they are thus less productive (and incur increased medical and other

costs); all of which, in turn, substantially affects interstate commerce. See id. at

615. The Court began its analysis by recognizing the foundational principle that the

power of the federal government is “defined and limited” and therefore: “Every law

enacted by Congress must be based on one or more of its powers enumerated in

the Constitution.” See id. at 607. It emphasized that while the legal analysis of the

Commerce Clause “has changed as our Nation has developed,” which has resulted

in Congress having “considerably greater latitude in regulating conduct and

transactions under the Commerce Clause than our previous case law permitted,”

authority under the Clause “is not without effective bounds.” See id. at 607-08.

The Court then looked to the four “significant considerations” that were identified

in Lopez and found that, “[w]ith these principles underlying our Commerce Clause

jurisprudence as reference points, the proper resolution of the present cases is

clear.” See id. at 610-13. First, the statute at issue in Morrison did not regulate

economic activity:

Gender-motivated crimes of violence are not, in any sense

of the phrase, economic activity. While we need not

adopt a categorical rule against aggregating the effects of

any noneconomic activity in order to decide these cases,

thus far in our Nation’s history our cases have upheld

Commerce Clause regulation of intrastate activity only

where that activity is economic in nature.

Id. at 613. Further, the statute did not contain jurisdictionally limiting language; and

while it was supported, in contrast to Lopez, with numerous congressional findings

regarding the personal, familial, and economic impact of gender-motivated violence,

those findings were insufficient to sustain the legislation as they relied on the same

“method of reasoning that we have already rejected as unworkable if we are to

maintain the Constitution’s enumeration of powers.” Id. at 615. In other words, it

would require the Court “to pile inference upon inference,” and, in the process, run

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the risk of “completely obliterat[ing] the Constitution’s distinction between national

and local authority.” See id.

In light of the circumscriptial rulings in Lopez and Morrison, many were

surprised by the Supreme Court’s subsequent decision in Gonzales v. Raich, 545

U.S. 1, 125 S. Ct. 2195, 162 L. Ed. 2d 1 (2005), which was not only seen as a

return to the more expansive Commerce Clause jurisprudence [see, e.g., Matthew

Farley, Challenging Supremacy: Virginia’s Response to the Patient Protection and

Affordable Care Act, 45 U. Rich. L. Rev. 37, 65 (2010)], but was, in fact, viewed

by some as even going beyond and “displacing” Wickard as the most far-reaching

of all Commerce Clause cases. See Douglas W. Kmiec, Gonzales v. Raich: Wickard

v. Filburn Displaced, 2005 Cato Sup. Ct. Rev. 71 (2005).

At issue in Raich was whether Congress had authority under the Commerce

and Necessary and Proper Clauses to prohibit, via the Controlled Substances Act,

“the local cultivation and use of marijuana in compliance with California law.” See

Raich, supra, 545 U.S. at 5. The marijuana at issue, which was being used by two

seriously ill women for medicinal purposes pursuant to state law, had been neither

bought nor sold and never crossed state lines. It was, and is, illegal in most states,

and does not have a legal free market in interstate commerce, the normal attribute

of any economic analysis. Nevertheless, the Supreme Court began its analysis by

stating: “Our case law firmly establishes Congress’ power to regulate purely local

activities that are part of an economic ‘class of activities’ that have a substantial

effect on interstate commerce.” Id. at 17. The Court found Wickard to be “striking”

in similarity and “of particular relevance” to the analysis as that case “establishes

that Congress can regulate purely intrastate activity that is not itself ‘commercial,’

in that it is not produced for sale, if it concludes that failure to regulate that class

of activity would undercut regulation of the interstate market in that commodity.”

Id. at 17-18. The Court held that Congress had a “rational basis” for finding that

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leaving home-consumed marijuana outside of federal control would affect the price

and market conditions for that commodity because, as was noted in Wickard, the

“production of the commodity meant for home consumption, be it wheat or

marijuana, has a substantial effect on supply and demand in the national market for

that commodity.” See id. at 19. Surprisingly, “[t]hat the market in Raich happened

to be an illegal one did not affect the Court’s analysis in the least.” Maxwell, supra,

446 F.3d at 1214.

The Eleventh Circuit has indicated that the distinguishing feature between

Raich and Wickard on the one hand, and Morrison and Lopez on the other, “was

the comprehensiveness of the economic component of the regulation.” Maxwell,

supra, 446 F.3d at 1214. The statute in Lopez, for example, was a brief, singlesubject

criminal statute that did not regulate any economic activity. By contrast,

the statute in Raich was a broader legislative scheme “at the opposite end of the

regulatory spectrum.“ Supra, 545 U.S. at 24. It was “a lengthy and detailed statute

creating a comprehensive framework for regulating the production, distribution, and

possession of [controlled substances],” which were “activities” the Supreme Court

determined to be “quintessentially economic” in nature. See id. at 24-25. The Court

reached this conclusion by “quite broadly defin[ing] ‘economics’ as ‘the production,

distribution, and consumption of commodities.’” See Maxwell, supra, 446 F.3d at

1215 n.4 (quoting Raich, supra, 545 U.S. at 25-26, in turn quoting Webster’s Third

New International Dictionary 720 (1966)).13

(c) Application of the Foregoing to the Facts of this Case

Unsurprisingly, the plaintiffs rely heavily on Lopez and Morrison in framing

13 In objecting to the majority’s use of this “broadest possible” definition,

Justice Thomas argued in dissent that “economics” is not defined as broadly in

other dictionaries, and “the majority does not explain why it selects a remarkably

expansive 40-year-old definition.” Raich, supra, 545 U.S. at 69 and n.7 (Thomas,

J., dissenting).

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their arguments, while the defendants, of course, look principally to Wickard and

Raich. These cases (along with the others discussed above) all have something to

add to the discussion. However, while they frame the analysis, and are important

from a historical perspective, they do not by themselves resolve this case. That is

because, as Congress’ attorneys in the Congressional Research Service (“CRS”)

and Congressional Budget Office (“CBO”) advised long before the Act was passed

into law, the notion of Congress having the power under the Commerce Clause to

directly impose an individual mandate to purchase health care insurance is “novel”

and “unprecedented.” See Jennifer Staman & Cynthia Brougher, Congressional

Research Service, Requiring Individuals to Obtain Health Insurance: A Constitutional

Analysis, July 24, 2009, at 3, 6 (“whether Congress can use its Commerce Clause

authority to require a person to buy a good or a service” raises a “novel issue” and

“most challenging question”) (“CRS Analysis”); Congressional Budget Office

Memorandum, The Budgetary Treatment of an Individual Mandate to Buy Health

Insurance, August 1994 (“A mandate requiring all individuals to purchase health

insurance would be an unprecedented form of federal action.”) (“CBO Analysis”).

Never before has Congress required that everyone buy a product from a private

company (essentially for life) just for being alive and residing in the United States.14

14 The individual mandate differs from the regulations in Wickard and Raich,

for example, in that the individuals being regulated in those cases were engaged in

an activity (regardless of whether it could readily be deemed interstate commerce

in itself) and each had the choice to discontinue that activity and avoid penalty.

See, e.g., Wickard v. Filburn, 317 U.S. 111, 130, 63 S. Ct. 82, 87 L. Ed. 122

(1942) (noting Congress “gave the farmer a choice” of several options under the

statute). Here, people have no choice but to buy insurance or be penalized. And

their freedom is actually more restricted as they do not even have a choice as to

the minimum level or type of insurance to buy because Congress established the

floor. A single twenty-year old man or woman who only needs and wants major

medical or catastrophic coverage, for example, is precluded from buying such a

policy under the Act.

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As I explained in my earlier order, the fact that legislation is unprecedented

does not by itself render it unconstitutional. To the contrary, all federal legislation

carries with it a “presumption of constitutionality.” Morrison, supra, 529 U.S. at

607. However, the presumption is arguably weakened, and an “absence of power”

might reasonably be inferred where — as here — “earlier Congresses avoided use

of this highly attractive power.” Printz v. United States, 521 U.S. 898, 905, 908,

117 S. Ct. 2365, 138 L. Ed. 2d 914 (1997); id. at 907-08 (“the utter lack of

statutes imposing obligations [like the one at issue in that case] (notwithstanding

the attractiveness of that course to Congress), suggests an assumed absence of

such power”) (emphasis in original); id. at 918 (“almost two centuries of apparent

congressional avoidance of the practice [at issue] tends to negate the existence of

the congressional power asserted here”).15 The mere fact that the defendants have

tried to analogize the individual mandate to things like jury service, participation in

the census, eminent domain proceedings, forced exchange of gold bullion for paper

currency under the Gold Clause Cases, and required service in a “posse” under the

Judiciary Act of 1789 (all of which are obviously distinguishable) only underscores

and highlights its unprecedented nature.

However, unprecedented or not, I will assume that the individual mandate

can be Constitutional under the Commerce Clause and will analyze it accordingly.

This analysis requires the resolution of two essential questions.

(i) Is Activity Required Under the Commerce Clause?

The threshold question that must be addressed is whether activity is required

before Congress can exercise its power under the Commerce Clause. As previously

15 Indeed, as the plaintiffs have persuasively noted, not even in the context

of insurance under the National Flood Insurance Program did Congress mandate

that all homeowners buy flood insurance directly from a private company. See Pl.

Opp. at 26-27.

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discussed, Commerce Clause jurisprudence has “‘taken some turns,’” [see Lopez,

supra, 514 U.S. at 579 (Kennedy, J., concurring)], and contracted and expanded

(and contracted and expanded again) during our nation’s development. But, in every

one of the cases — in both the contractive and expansive — there has always been

clear and inarguable activity, from exerting control over and using navigable waters

(Gibbons) to growing or consuming marijuana (Raich).16 In all the cases discussed

above, the Supreme Court was called upon to decide different issues (e.g., whether

commerce encompassed navigation; whether it included manufacture and

agriculture or was limited to trade or exchange of goods; whether the activity at

issue was interstate or intrastate and had a direct or indirect effect on commerce;

whether that effect was substantial; whether the activity was economic or noneconomic;

and whether it was part of a single-subject statute or a necessary and

essential component of a broader comprehensive scheme), but it has never been

called upon to consider if “activity” is required. On this point at least, the district

courts that have reached opposite conclusions on the individual mandate agree.

Compare Thomas More Law Center, supra, 720 F. Supp. 2d at 893 (noting that the

Supreme Court “has never needed to address the activity/inactivity distinction

advanced by plaintiffs because in every Commerce Clause case presented thus far,

there has been some sort of activity”; then proceeding to uphold the individual

mandate), with Virginia, supra, 728 F. Supp. 2d at 781 (noting that “every

application of Commerce Clause power found to be constitutionally sound by the

16 The defendants cite to Raich for the proposition that Congress may reach

“even wholly intrastate, non-commercial matters when it concludes that the failure

to do so would undercut a larger program regulating interstate commerce.” See

Def. Mem. at 13. By paraphrasing Raich here rather than quoting from the decision

the defendants have attempted to obscure the importance of “activity,” for the

cited portion, and Justice Scalia’s concurrence (on which the defendants also rely),

do not talk at all of “matters” — either commercial or not. They only mention (and

often) “activities.”

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Supreme Court involved some form of action, transaction, or deed placed in motion

by an individual or legal entity”; then proceeding to strike down the individual

mandate).

The defendants contend, however, that despite the inarguable presence of

activity in every Supreme Court case to date, activity is not required under the

Commerce Clause. See Def. Mem. at 31 (maintaining that “there is no ‘activity’

clause in the constitution”). In fact, they go so far as to suggest that to impose

such a requirement would be bold and radical. According to the defendants,

because the Supreme Court has never identified a distinction between activity and

inactivity as a limitation on Congress’ commerce power, to hold otherwise would

“break new legal ground” and be “novel” and “unprecedented.” See Def. Opp. at 1,

2, 16. First, it is interesting that the defendants — apparently believing the best

defense is a good offense — would use the words “novel” and “unprecedented”

since, as previously noted, those are the exact same words that the CRS and CBO

used to describe the individual mandate before it became law. Furthermore, there is

a simple and rather obvious reason why the Supreme Court has never distinguished

between activity and inactivity before: it has not been called upon to consider the

issue because, until now, Congress had never attempted to exercise its Commerce

Clause power in such a way before. See CBO Analysis (advising Congress during

the previous health care reform efforts in 1994 that “[t]he government has never

required people to buy any good or service as a condition of lawful residence in the

United States.”). In every Supreme Court case decided thus far, Congress was not

seeking to regulate under its commerce power something that could even arguably

be said to be “passive inactivity.”17

17 I note that in Gibbons v. Ogden, where Chief Justice Marshall “described

the Federal Commerce power with a breadth never yet exceeded” [Wickard, supra,

317 U.S. at 111], commerce was defined as “intercourse.” Even that word would

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It would be a radical departure from existing case law to hold that Congress

can regulate inactivity under the Commerce Clause. If it has the power to compel

an otherwise passive individual into a commercial transaction with a third party

merely by asserting — as was done in the Act — that compelling the actual

transaction is itself “commercial and economic in nature, and substantially affects

interstate commerce” [see Act § 1501(a)(1)], it is not hyperbolizing to suggest that

Congress could do almost anything it wanted. It is difficult to imagine that a nation

which began, at least in part, as the result of opposition to a British mandate giving

the East India Company a monopoly and imposing a nominal tax on all tea sold in

America would have set out to create a government with the power to force people

to buy tea in the first place. If Congress can penalize a passive individual for failing

to engage in commerce, the enumeration of powers in the Constitution would have

been in vain for it would be “difficult to perceive any limitation on federal power”

[Lopez, supra, 514 U.S. at 564], and we would have a Constitution in name only.

Surely this is not what the Founding Fathers could have intended. See id. at 592

(quoting Hamilton at the New York Convention that there would be just cause to

reject the Constitution if it would allow the federal government to “penetrate the

recesses of domestic life, and control, in all respects, the private conduct of

individuals”) (Thomas, J., concurring). In Lopez, the Supreme Court struck down

the Gun Free School Zones Act of 1990 after stating that, if the statute were to be

seem to carry with it an implicit presumption of at least some sort of preexisting

dealing between people or entities. See 1 Samuel Johnson, A Dictionary of the

English Language (4th ed. 1773) (defining “intercourse” as “Commerce; exchange”

and “Communication”). Furthermore, as one of the amici notes in their brief, the

word “regulate” in the Commerce Clause itself would also appear to presuppose

action upon some object or activity that is already extant (see doc. 121 at 4 n.1,

citing Samuel Johnson’s dictionary defining “regulate” as “to adjust by rule or

method” or “to direct”). Thus, a regulator “comes to an existing phenomenon and

orders it.” Id.

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upheld, “we are hard pressed to posit any activity by an individual that Congress is

without power to regulate.” See id. at 564. (emphasis added). If some type of

already-existing activity or undertaking were not considered to be a prerequisite to

the exercise of commerce power, we would go beyond the concern articulated in

Lopez for it would be virtually impossible to posit anything that Congress would be

without power to regulate.

As previously noted, the Supreme Court has summarized and defined the

current state of the law under the Commerce Clause, and it has uniformly and

consistently declared that it applies to “three broad categories of activity.” Lopez,

supra, 514 U.S. at 558 (emphasis added); accord Morrison, supra, 529 U.S. at

608. It has further described the third category as “the power to regulate those

activities having a substantial relation to interstate commerce.” Lopez, supra, 514

U.S. at 558-59 (emphasis added); accord Morrison, supra, 529 U.S. at 609; see

also Raich, supra, 545 U.S. at 17; Perez, 402 U.S. at 150; Wickard, supra, 317

U.S. at 124; Darby, supra, 312 U.S. at 119-20; Jones & Laughlin Steel, supra, 301

U.S. at 37. Without doubt, existing case law thus extends only to those “activities”

that have a substantial relationship to, or substantially affect, interstate commerce.

I am required to interpret this law as the Supreme Court presently defines it. Only

the Supreme Court can redefine it or expand it further — a point implicitly made by

one of the defendants’ own cited authorities. See Stern, supra, at 1363 (stating

that the Supreme Court had at one point in time only talked about “movement” of

goods across state lines under the Commerce Clause because it was necessary to

decide those earlier cases and there had “been no need for a broader definition” of

commerce; going on to opine that “it would seem timely that the Supreme Court”

expand the definition, as “the time has now arrived for the [Supreme] Court to cut

loose from the ‘old’ approach and to select the ‘new’ one”) (emphasis added).

Having found that “activity” is an indispensable part the Commerce Clause

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analysis (at least as currently understood, defined, and applied in Supreme Court

case law), the Constitutionality of the individual mandate will turn on whether the

failure to buy health insurance is “activity.”

(ii) Is the Failure to Purchase Health Insurance “Activity”?

Preliminarily, based solely on a plain reading of the Act itself (and a common

sense interpretation of the word “activity” and its absence), I must agree with the

plaintiffs’ contention that the individual mandate regulates inactivity. Section 1501

states in relevant part: “If an applicable individual fails to [buy health insurance],

there is hereby imposed a penalty.” By its very own terms, therefore, the statute

applies to a person who does not buy the government-approved insurance; that is,

a person who “fails” to act pursuant to the congressional dictate. In fact, prior to

final passage of the Act, CRS attorneys advised Congress that it was “unclear” if

the individual mandate had “solid constitutional foundation” specifically because:

One could argue that while regulation of the health

insurance industry or the health care system could be

considered economic activity, regulating a choice to

purchase health insurance is not. It may also be

questioned whether a requirement to purchase health

insurance is really a regulation of an economic activity or

enterprise, if individuals who would be required to

purchase health insurance are not, but for this regulation,

a part of the health insurance market. In general,

Congress has used its authority under the Commerce

Clause to regulate individuals, employers, and others who

voluntarily take part in some type of economic activity.

While in Wickard and Raich, the individuals were

participating in their own home activities (i.e., producing

wheat for home consumption and cultivating marijuana

for personal use), they were acting of their own volition,

and this activity was determined to be economic in nature

and affected interstate commerce. However, [the

individual mandate] could be imposed on some individuals

who engage in virtually no economic activity whatsoever.

This is a novel issue: whether . . . this type of required

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participation can be considered economic activity.

CRS Analysis, supra, at 3, 6 (emphasis added).

The defendants insist that the uninsured are active. In fact, they even go so

far as to make the claim — which the plaintiffs call “absurd” — that going without

health insurance constitutes “economic activity to an even greater extent than the

plaintiffs in Wickard or Raich.” See Def. Mem. at 29. They offer two (somewhat

overlapping) arguments why the appearance of inactivity here is just an “illusion.”

(iii) The Purported “Uniqueness” of the Health Care Market

The defendants contend that there are three unique elements of the health

care market which, when viewed cumulatively and in combination, belie the claim

that the uninsured are inactive.18 First, as living and breathing human beings who

are always susceptible to sudden and unpredictable illness and injury, no one can

“opt out” of the health care market. Second, if and when health services are

sought, hospitals are required by law to provide care, regardless of inability to pay.

And third, if the costs incurred cannot be paid (which they frequently cannot, given

the high cost of medical care), they are passed along (cost-shifted) to third parties,

which has economic implications for everyone. Congress found that the uninsured

received approximately $43 billion in “uncompensated care” in 2008 alone. These

three things, according to the defendants and various health care industry experts

and scholars on whom they rely, are “replicated in no other market” and defeat the

18 During oral argument, the plaintiffs opposed defining the relevant market

broadly as one for health care, insisting that the only relevant market for purposes

of analyzing the individual mandate is the more specific health insurance market. I

agree that the plaintiffs’ position is the more precise and accurate. Every market

can be broadly defined in a way that encompasses the specific characteristics one

seeks to reach or include. Nonetheless, I will consider and examine the defendants’

claim that the individual mandate is justifiable because the much broader “health

care market” is purportedly unique.

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argument that uninsured individuals are inactive.19

First, it is not at all clear whether or why the three allegedly unique factors

of the health care market are Constitutionally significant. What if only one of the

three factors identified by the defendants is present? After all, there are lots of

markets — especially if defined broadly enough — that people cannot “opt out” of.

For example, everyone must participate in the food market. Instead of attempting

to control wheat supply by regulating the acreage and amount of wheat a farmer

could grow as in Wickard, under this logic, Congress could more directly raise toolow

wheat prices merely by increasing demand through mandating that every adult

purchase and consume wheat bread daily, rationalized on the grounds that because

everyone must participate in the market for food, non-consumers of wheat bread

adversely affect prices in the wheat market. Or, as was discussed during oral

argument, Congress could require that people buy and consume broccoli at regular

intervals, not only because the required purchases will positively impact interstate

commerce, but also because people who eat healthier tend to be healthier, and are

thus more productive and put less of a strain on the health care system. Similarly,

because virtually no one can be divorced from the transportation market, Congress

could require that everyone above a certain income threshold buy a General Motors

automobile — now partially government-owned — because those who do not buy

GM cars (or those who buy foreign cars) are adversely impacting commerce and a

taxpayer-subsidized business.

I pause here to emphasize that the foregoing is not an irrelevant and fanciful

19 For example, in their briefs and during oral argument, the defendants cited

to and relied on the amicus brief filed by an impressive list of nearly forty economic

scholars, who have urged that these “three observations . . . do not exist in other

contexts” and establish that the uninsured are not inactive and passive bystanders,

but rather they “participate in the market for medical services and necessarily

affect the market for health insurance” (doc. 125 at 6-13).

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“parade of horribles.” Rather, these are some of the serious concerns implicated by

the individual mandate that are being discussed and debated by legal scholars. For

example, in the course of defending the Constitutionality of the individual mandate,

and responding to the same concerns identified above, often-cited law professor

and dean of the University of California Irvine School of Law Erwin Chemerinsky

has opined that although “what people choose to eat well might be regarded as a

personal liberty” (and thus unregulable), “Congress could use its commerce power

to require people to buy cars.” See ReasonTV, Wheat, Weed, and Obamacare: How

the Commerce Clause Made Congress All-Powerful, August 25, 2010, available at:

http://reason.tv/video/show/wheat-weed-and-obamacare-how-t. When I mentioned

this to the defendants’ attorney at oral argument, he allowed for the possibility that

“maybe Dean Chemerinsky is right.” See Tr. at 69. Therefore, the potential for this

assertion of power has received at least some theoretical consideration and has not

been ruled out as Constitutionally implausible.20

Or what if two of the purported “unique” factors — inevitable participation

coupled with cost-shifting — are present? For example, virtually no one can opt out

of the housing market (broadly defined) and a majority of people will at some point

20 There is perhaps a general assumption that it is “ridiculous” to believe that

Congress would do such a thing, even though it could. However, before Wickard

was decided, it is likely that most people (including legal scholars and judges)

would have thought it equally “ridiculous” to believe that Congress would one day

seek (and be permitted) to regulate (as interstate commerce) the amount of wheat

that a farmer grew on a small private farm for his personal consumption. In any

event, even if such an assumption is well-founded, “the limitation of congressional

authority is not solely a matter of legislative grace.” See Morrison, supra, 529 U.S.

at 616; see also id. at 616 n.7 (stating that legislative power is not limited only by

“the Legislature’s self-restraint”); cf. United States v. Stevens, — U.S. —, 130 S.

Ct. 1577, 1591, 176 L. Ed. 2d 435 (2010) (“[T]he [Constitution] protects against

the Government; it does not leave us at the mercy of noblesse oblige. We would

not uphold an unconstitutional statute merely because the Government promised to

use it responsibly.”).

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buy a home. The vast majority of those homes will be financed with a mortgage, a

large number of which (particularly in difficult economic times, as we have seen

most recently) will go into default, thereby cost-shifting billions of dollars to third

parties and the federal government. Should Congress thus have power under the

Commerce Clause to preemptively regulate and require individuals above a certain

income level to purchase a home financed with a mortgage (and secured with

mortgage guaranty insurance) in order to add stability to the housing and financial

markets (and to guard against the possibility of future cost-shifting because of a

defaulted mortgage), on the theory that most everyone is currently, or inevitably

one day will be, active in the housing market?

In alluding to these same general concerns, another court has observed that

requiring advance purchase of health insurance based on a future contingency that

will substantially affect commerce could also “apply to transportation, housing, or

nutritional decisions. This broad definition of the economic activity subject to

congressional regulation lacks logical limitation and is unsupported by Commerce

Clause jurisprudence.” See Virginia, supra, 728 F. Supp. 2d at 781. That the

defendants’ argument is “unsupported by Commerce Clause jurisprudence” can

perhaps best be seen by looking to Lopez. Although that case is distinct from this

one in some notable ways (e.g., it involved a brief, single-subject criminal statute

that did not contain detailed legislative findings), in the context of the defendants’

“health care is unique” argument, it is quite similar.

In Lopez, the majority was concerned that using the Commerce Clause to

regulate things such as possession of guns in school zones would “obliterate” the

distinction between what is national and what is local and effectively create a

centralized government that could potentially permit Congress to begin regulating

“any and all aspects” of our lives, including marriage, divorce, child custody, and

education. The dissent insisted that this concern was unfounded because the

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statute at issue was “aimed at curbing a particularly acute threat” of violence in

schools that had “singularly disruptive potential.” Supra, 514 U.S. at 624 (Breyer,

J., dissenting). Relying on “empirical evidence . . . documented by scholars,” the

dissent highlighted the link between education and the national economy and “the

special way in which guns and education are incompatible.” See id. The impact on

commerce, it was urged, derived from the unchallenged fact that “violent crime in

school zones has brought about a decline in the quality of education” which, in

turn, has “an adverse impact on interstate commerce.” See id. at 623 (citation and

quotation marks omitted). This was “the rare case, then, that a statute strikes at

conduct that (when considered in the abstract) seems so removed from commerce,

but which (practically speaking) has so significant an impact upon commerce.” Id.

(all emphasis added).

Two things become apparent after reading these arguments attempting to

justify extending Commerce Clause power to the legislation in that case, and the

majority opinion (which is the controlling precedent) rejecting those same

arguments. First, the contention that Commerce Clause power should be upheld

merely because the government and its experts or scholars claim that it is being

exercised to address a “particularly acute” problem that is “singular[ ],” “special,”

and “rare” — that is to say “unique” — will not by itself win the day. Uniqueness is

not an adequate limiting principle as every market problem is, at some level and in

some respects, unique. If Congress asserts power that exceeds its enumerated

powers, then it is unconstitutional, regardless of the purported uniqueness of the

context in which it is being asserted.

Second, and perhaps more significantly, under Lopez the causal link between

what is being regulated and its effect on interstate commerce cannot be attenuated

and require a court “to pile inference upon inference,” which is, in my view, exactly

what would be required to uphold the individual mandate. For example, in contrast

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to individuals who grow and consume marijuana or wheat (even in extremely small

amounts), the mere status of being without health insurance, in and of itself, has

absolutely no impact whatsoever on interstate commerce (not “slight,” “trivial,” or

“indirect,” but no impact whatsoever) — at least not any more so than the status

of being without any particular good or service. If impact on interstate commerce

were to be expressed and calculated mathematically, the status of being uninsured

would necessarily be represented by zero. Of course, any other figure multiplied by

zero is also zero. Consequently, the impact must be zero, and of no effect on

interstate commerce. The uninsured can only be said to have a substantial effect

on interstate commerce in the manner as described by the defendants: (i) if they

get sick or injured; (ii) if they are still uninsured at that specific point in time; (iii) if

they seek medical care for that sickness or injury; (iv) if they are unable to pay for

the medical care received; and (v) if they are unable or unwilling to make payment

arrangements directly with the health care provider, or with assistance of family,

friends, and charitable groups, and the costs are thereafter shifted to others. In my

view, this is the sort of piling “inference upon inference” rejected in Lopez, supra,

514 U.S. at 567, and subsequently described in Morrison as “unworkable if we are

to maintain the Constitution’s enumeration of powers.” Supra, 529 U.S. at 615.21

I do not mean to suggest that these inferences are illogical or unreasonable

to draw. As did the majority in Lopez and Morrison, I do not dispute or question

their underlying existence. Indeed, while $43 billion in uncompensated care from

21 I suppose it is also possible to contend that being uninsured impacts the

economy because (regardless of whether the uninsured receive care that is costshifted

to others) people without insurance tend to be less healthy and thus less

productive. This seems to be the basis of one of Congress’ findings. See Act §

1501(a)(2)(E) (finding that the national economy “loses up to $207,000,000,000 a

year because of the poorer health and shorter lifespan of the uninsured”). However,

such a claim would be similar to the argument that was rejected in Morrison, i.e.,

that victims of gender-motivated violence also tend to be less productive.

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2008 was only 2% of national health care expenditures for that year, it is clearly a

large amount of money; and it demonstrates that a number of the uninsured are

taking the five sequential steps. And when they do, Congress plainly has the power

to regulate them at that time (or even at the time that they initially seek medical

care), a fact with which the plaintiffs agree. But, to cast the net wide enough to

reach everyone in the present, with the expectation that they will (or could) take

those steps in the future, goes beyond the existing “outer limits” of the Commerce

Clause and would, I believe, require inferential leaps of the sort rejected in Lopez.

To the extent the defendants have suggested it is “empty formalism” [Def. Mem.

at 16] to hold that the uninsured can be regulated at the time they seek or fail to

pay for medical care (but not before) the Supreme Court has explained:

Much of the Constitution is concerned with setting forth

the form of our government, and the courts have

traditionally invalidated measures deviating from that

form. The result may appear “formalistic” in a given case

to partisans of the measure at issue, because such

measures are typically the product of the era’s perceived

necessity. But the Constitution protects us from our own

best intentions: It divides power among sovereigns and

among branches of government precisely so that we may

resist the temptation to concentrate power in one

location as an expedient solution to the crisis of the day

. . . . [A] judiciary that licensed extra-constitutional

government with each issue of comparable gravity would,

in the long run, be far worse [than the crisis itself].

New York, supra, 505 U.S. at 187.

In short, the defendants’ argument that people without health insurance are

actively engaged in interstate commerce based on the purported “unique” features

of the much broader health care market is neither factually convincing nor legally

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supportable.22

(iv) The “Economic Decision” to Forego Health Insurance

The defendants next contend that the uninsured have made the calculated

decision to engage in market timing and try to finance their future medical needs

out-of-pocket rather than through insurance, and that this “economic decision” is

tantamount to activity. The plaintiffs respond by suggesting that it is “a remarkable

exaggeration of [the] rational aspects of human nature” to claim that the uninsured

(as a rule) make structured and calculated decisions to forego insurance and engage

in market timing, as opposed to simply not having it. See Tr. at 16 (“All we know

is some people do not have insurance and some people do”). The plaintiffs describe

the defendants’ argument on this point “Orwellian,” because they seek “to redefine

the inactivity of not having healthcare insurance as an affirmative economic activity

of ‘deciding’ not to buy insurance, or deciding now how to pay (or not to pay) for

potential future economic activity in the form of obtaining medical services.” See

Pl. Opp. at 10 (emphasis in original). This “economic decision” argument has been

accepted by two district courts, Liberty Univ., Inc., supra, 2010 WL 4860299, at

*15; Thomas More Law Center, supra, 720 F. Supp. 2d at 893-94. For example, in

Liberty University, the District Court for the Western District of Virginia stated that

“by choosing to forego insurance, Plaintiffs are making an economic decision to try

to pay for health care services later, out of pocket, rather than now, through the

purchase of insurance,” and concluded that these decisions constitute economic

activity “[b]ecause of the nature of supply and demand, Plaintiff’s choices directly

22 The defendants also suggest that the uninsured are “active” in the health

insurance market — and therefore can be regulated and forced to buy insurance —

because a large percentage of them have had insurance within the past year. The

defendants have provided no authority for the suggestion that once someone is in

the health insurance market at a particular point in time, they are forever in that

market, always subject to regulation, and not ever permitted to leave.

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affect the price of insurance in the market, which Congress set out in the Act to

control.” See 2010 WL 4860299, at *15.

The problem with this legal rationale, however, is it would essentially have

unlimited application. There is quite literally no decision that, in the natural course

of events, does not have an economic impact of some sort. The decisions of

whether and when (or not) to buy a house, a car, a television, a dinner, or even a

morning cup of coffee also have a financial impact that — when aggregated with

similar economic decisions — affect the price of that particular product or service

and have a substantial effect on interstate commerce. To be sure, it is not difficult

to identify an economic decision that has a cumulatively substantial effect on

interstate commerce; rather, the difficult task is to find a decision that does not.23

Some of our wisest jurists have pointed out the threat that lies in an overexpansive

Commerce Clause construction. The words that Judge Learned Hand

wrote in 1935 are even truer today:

In an industrial society bound together by means of

transport and communication as rapid and certain as ours,

it is idle to seek for any transaction, however apparently

isolated, which may not have an effect elsewhere; such a

society is an elastic medium which transmits all tremors

throughout its territory; the only question is of their size.

United States v. A.LA. Schechter Poultry Corp., 76 F.2d 617, 624 (2d Cir. 1935),

aff’d in part and rev’d in part, supra, 295 U.S. at 554 (noting in an elastic society

like ours everything affects commerce in the sense that “[m]otion at the outer rim

is communicated perceptibly, though minutely, to recording instruments at the

center;” but to hold that everything may thus be regulated under the Commerce

Clause “will be an end to our federal system”) (Cardozo, J., concurring). As the

23 As was discussed at the hearing, even personal decisions about whether

to marry, whom to marry, or whether to have children could also be characterized

as “economic decisions.”

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Supreme Court emphasized in Morrison, supra: “‘In a sense any conduct in this

interdependent world of ours has an ultimate commercial origin or consequence,

but we have not yet said the commerce power may reach so far.’” 529 U.S. at 611

(quoting Lopez, supra, 514 U.S. at 580 (Kennedy, J., concurring)); accord Patton,

supra, 451 F.3d at 628 (explaining that everything could be said to affect interstate

commerce “in the same sense in which a butterfly flapping its wings in China might

bring about a change of weather in New York,” but if all things affecting interstate

commerce were held to be within Congress’ regulatory power, “the Constitution’s

enumeration of powers would have been in vain”).

Attempting to deflect this rather common sense rebuttal to their argument,

the defendants emphasized during oral argument that it is not just the “economic

decision” itself that renders the failure to buy insurance activity; rather, it is that

decision coupled with the fact that the uninsured are guaranteed access to medical

care in hospital emergency rooms as a “backstop,” the use of which can and does

shift costs onto third parties. The defendants thus refer to the failure to buy health

insurance as a “financing decision.” However, this is essentially true of any and all

forms of insurance. It could just as easily be said that people without burial, life,

supplemental income, credit, mortgage guaranty, business interruption, or disability

insurance have made the exact same or similar economic and financing decisions

based on their expectation that they will not incur a particular risk at a particular

point in time; or that if they do, it is more beneficial for them to self-insure and try

to meet their obligations out-of-pocket, but always with the benefit of “backstops”

provided by law, including bankruptcy protection and other government-funded

financial assistance and services. See, e.g., Katie Zezima, Indigent Burials Are On

the Rise, New York Times, Oct. 11, 2009, at A23 (reporting the number of burials

of those who die with insufficient assets are increasing across the country, up 50%

in Oregon, and that funeral expenses are frequently borne by governmental entities;

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noting that Illinois alone budgets $12 million for these expenses). The “economic

decision” to forego virtually any and all types of insurance can (and cumulatively

do) similarly result in significant cost-shifting to third parties.24

The important distinction is that “economic decisions” are a much broader

and far-reaching category than are “activities that substantially affect interstate

commerce.” While the latter necessarily encompasses the first, the reverse is not

true. “Economic” cannot be equated to “commerce.” And “decisions” cannot be

equated to “activities.” Every person throughout the course of his or her life makes

hundreds or even thousands of life decisions that involve the same general sort of

thought process that the defendants maintain is “economic activity.” There will be

no stopping point if that should be deemed the equivalent of activity for Commerce

Clause purposes.25

24 To the extent that people dying without burial insurance is by itself not as

severe a problem as people without health insurance — and I readily acknowledge

it is not — that is merely a difference in degree, not in kind. The fact that people

without health insurance pose a more serious problem than people without burial

insurance may give Congress more of a reason to act; but it does not give it more

Constitutional authority to do so. See United States v. A.LA. Schechter Poultry

Corp., 76 F.2d 617, 624 (2d Cir. 1935) (noting that “emergency does not create

the power [of Congress to act], but it may furnish the occasion for the exercise of

the power conferred by the Constitution”), aff’d in part and rev’d in part, 295 U.S.

495, 55 S. Ct. 837, 79 L. Ed. 1570 (1935).

25 For example, if the decision to forego insurance qualifies as activity, then

presumably the decision to not use that insurance once it has been obtained is also

activity. The government acknowledged during oral argument in Virginia v. Sebelius

that although people are required to buy health insurance under the Act, they are

not yet required to use it. See Transcript of Oral Argument on Defendants’ Motion

to Dismiss, July 1, 2010, at 26 (“the statute doesn’t require anybody to [actually]

get medical services”); see also id. at 30 (“Congress isn’t saying go see a doctor,

or you have to go. What Congress is saying is you have to purchase health

insurance.”). But what happens if the newly-insured (as a class) do not seek

preventive medical care? Because Congress found in the Act that the economy

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The Commerce Clause originally applied to the trade and exchange of goods

as it sought to eliminate trade barriers by and between the states. Over the years,

the Clause’s reach has been expanded from covering actual interstate commerce

(and its channels and instrumentalities) to intrastate activities that substantially

affect interstate commerce. It has even been applied to activities that involve the

mere consumption of a product (even if there is no legal commercial interstate

market for that product). To now hold that Congress may regulate the so-called

“economic decision” to not purchase a product or service in anticipation of future

consumption is a “bridge too far.” It is without logical limitation and far exceeds

the existing legal boundaries established by Supreme Court precedent.

Because I find both the “uniqueness” and “economic decision” arguments

unpersuasive, I conclude that the individual mandate seeks to regulate economic

inactivity, which is the very opposite of economic activity. And because activity is

required under the Commerce Clause, the individual mandate exceeds Congress’

commerce power, as it is understood, defined, and applied in the existing Supreme

Court case law.

(2) The Necessary and Proper Clause

The defendants contend that the individual mandate is “also a valid exercise

of Congress’s authority if the provision is analyzed under the Necessary and Proper

Clause.” See Def. Mem. at 23. This argument has been appropriately called “the

last, best hope of those who defend ultra vires congressional action.” See Printz,

supra, 521 U.S. at 923. Oversimplified, the defendants’ argument on this point can

be reduced to the following: (i) the Act bans insurers from denying health coverage

loses money each year “because of the poorer health and shorter lifespan of the

uninsured” [see supra note 19], it would seem only logical under the defendants’

rationale that Congress may also regulate the “economic decisions” not to go to

the doctor for regular check-ups and screenings to improve health and longevity,

which, in turn, is intended and expected to increase economic productivity.

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(guaranteed issue), or charging higher premiums (community rating), to individuals

with pre-existing medical conditions (which increases the insurers’ costs); (ii) as a

result of these bans, individuals will be incentivized to delay obtaining insurance as

they are now guaranteed coverage if they get sick or injured (which decreases the

insurers’ revenues); and (iii) as a result of the foregoing, there will be fewer healthy

people in the insured pool (which will raise the premiums and costs for everyone).

Consequently, it is necessary to require that everyone “get in the pool” so as to

protect the private health insurance market from inevitable collapse.

At the outset, I note that in United States v. Comstock, — U.S. —, 130 S.

Ct. 1949, 176 L. Ed. 2d 878 (2010), the Supreme Court’s most recent discussion

and application of the Necessary and Proper Clause, the Court identified and looked

to five “considerations” that informed its decision about whether the legislation at

issue was sustainable: (1) the breadth of the Necessary and Proper Clause; (2) the

history of federal involvement in the relevant arena, and the modest addition to that

arena; (3) the sound reasons for the legislation in light of the government’s interest;

(4) the statute’s accommodation of state interests; and (5) its narrow scope. It is

not entirely clear if this constitutes a “five-factor test,” as Justice Thomas urged in

dissent, see id. at 1974, or whether the “considerations” were merely factors that

the majority believed relevant to deciding that particular case. To the extent that

they constitute a “test,” the individual mandate clearly gets a failing score on at

least two (and possibly a couple more) of the five elements. A statute mandating

that everyone purchase a product from a private company or be penalized (merely

by virtue of being alive and a lawful citizen) is not a “modest” addition to federal

involvement in the national health care market, nor is it “narrow [in] scope.” I will

assume, however, that the Comstock “considerations” were just that, and that

they did not bring about any fundamental change in the Court’s long established

Necessary and Proper Clause analysis.

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The Necessary and Proper Clause provides that Congress shall have the

power:

To make all Laws which shall be necessary and proper for

carrying into Execution the foregoing Powers, and all

other Powers vested by this Constitution in the

Government of the United States, or in any Department

or Officer thereof.

U.S. Const. art. I, § 8, cl. 18 (emphasis added). The Supreme Court has repeatedly

held, and the emphasized text makes clear, that the Clause is not an independent

source of federal power; rather, it is simply “a caveat that the Congress possesses

all the means necessary to carry out the specifically granted ‘foregoing’ powers of

[section] 8 ‘and all other Powers vested by this Constitution.’ [It] is ‘but merely a

declaration, for the removal of all uncertainty, that the means of carrying into

execution those (powers) otherwise granted are included in the grant.’” Kinsella v.

United States ex rel. Singleton, 361 U.S. 234, 247, 80 S. Ct. 297, 4 L. Ed. 2d 268

(1960); see also Raich, supra, 545 U.S. at 39 (Scalia, J., concurring in judgment)

(stating that, while the Clause “empowers Congress to enact laws . . . that are not

within its authority to enact in isolation,” those laws must be “in effectuation of

[Congress’] enumerated powers”); Kansas v. Colorado, 206 U.S. 46, 88, 27 S. Ct.

655, 51 L. Ed. 956 (1907) (stating that the Necessary and Proper Clause “is not

the delegation of a new and independent power, but simply provision for making

effective the powers theretofore mentioned”).

Hamilton wrote the following in response to the concern voiced by some that

the Necessary and Proper Clause — and the Supremacy Clause as well — could be

used to expand federal power and destroy liberties:

These two clauses have been the source of much virulent

invective and petulant declamation against the proposed

Constitution. They have been held up to the people in all

the exaggerated colors of misrepresentation as the

pernicious engines by which their local governments were

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to be destroyed and their liberties exterminated; as the

hideous monster whose devouring jaws would spare

neither sex nor age, nor high nor low, nor sacred nor

profane; and yet, strange as it may appear, after all this

clamor, to those who may not have happened to

contemplate them in the same light, it may be affirmed

with perfect confidence, that the constitutional operation

of the intended government would be precisely the same,

if these clauses were entirely obliterated, as if they were

repeated in every article. They are only declaratory of a

truth, which would have resulted by necessary and

unavoidable implication from the very act of constituting

a federal government, and vesting it with certain specific

powers.

The Federalist No. 33, at 204-05. To the extent there was anything to fear in the

Constitution, Hamilton explained, it must be found in the specific powers that were

enumerated and not in the Necessary and Proper Clause, for though the latter “may

be chargeable with tautology or redundancy, [it] is at least perfectly harmless.” See

id. at 206. Madison concurred with this view. See The Federalist No. 44, at 302

(explaining that the Clause is entirely redundant for if it had been omitted, “there

can be no doubt” that the same power and authority “would have resulted to the

government, by unavoidable implication”). If these advocates for ratification had

any inkling that, in the early twenty-first century, government proponents of the

individual health insurance mandate would attempt to justify such an assertion of

power on the basis of this Clause, they probably would have been the strongest

opponents of ratification. They would have recognized how such an interpretation

and application of the Necessary and Proper Clause would eviscerate the bedrock

enumerated powers principle upon which the Constitution rests.

One of the amicus curiae briefs illustrates how using the Necessary and

Proper Clause in the manner as suggested by the defendants would vitiate the

enumerated powers principle (doc. 119). It points out that the defendants’ are

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essentially admitting that the Act will have serious negative consequences, e.g.,

encouraging people to forego health insurance until medical services are needed,

increasing premiums and costs for everyone, and thereby bankrupting the health

insurance industry — unless the individual mandate is imposed. Thus, rather than

being used to implement or facilitate enforcement of the Act’s insurance industry

reforms, the individual mandate is actually being used as the means to avoid the

adverse consequences of the Act itself. Such an application of the Necessary and

Proper Clause would have the perverse effect of enabling Congress to pass illconceived,

or economically disruptive statutes, secure in the knowledge that the

more dysfunctional the results of the statute are, the more essential or “necessary”

the statutory fix would be. Under such a rationale, the more harm the statute does,

the more power Congress could assume for itself under the Necessary and Proper

Clause. This result would, of course, expand the Necessary and Proper Clause far

beyond its original meaning, and allow Congress to exceed the powers specifically

enumerated in Article I. Surely this is not what the Founders anticipated, nor how

that Clause should operate.

Ultimately, the Necessary and Proper Clause vests Congress with the power

and authority to exercise means which may not in and of themselves fall within an

enumerated power, to accomplish ends that must be within an enumerated power.

Although Congress’ authority to act in furtherance of those ends is unquestionably

broad, there are nevertheless “restraints upon the Necessary and Proper Clause

authority.” See Raich, supra, 545 U.S. at 39 (Scalia, J., concurring in judgment).

Thomas Jefferson warned against an overly expansive application of cause and

effect in interpreting the interplay between Congress’ enumerated powers and the

Necessary and Proper Clause:

Congress are authorized to defend the nation. Ships are

necessary for defense; copper is necessary for ships;

mines necessary for copper; a company necessary to

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work mines; and who can doubt this reasoning who has

ever played at “This is the House that Jack Built?”

Letter from Thomas Jefferson to Edward Livingston (Apr. 30, 1800), in 31 The

Papers of Thomas Jefferson 547 (B. Oberg ed., 2004); accord Comstock, supra,

130 S. Ct. at 1966 (referencing same analogy and stating that the Necessary and

Proper Clause “must be controlled by some limitations lest, as Thomas Jefferson

warned, congressional powers become completely unbounded by linking one power

to another ad infinitum”) (Kennedy, J., concurring); see also id. at 1970 (explaining

that the Clause “does not give Congress carte blanche,” and it is the “obligation of

this Court” to impose limitations) (Alito, J., concurring). As for where the restraints

and limitations might be, it is — as is often the case — appropriate to look to Chief

Justice Marshall, who first considered this issue and articulated the still-governing

analysis:

Let the end be legitimate, let it be within the scope of the

constitution, and all means which are appropriate, which

are plainly adapted to that end, which are not prohibited,

but consist with the letter and spirit of the constitution,

are constitutional.

* * *

[However,] should congress, in the execution of its

powers, adopt measures which are prohibited by the

constitution; or should congress, under the pretext of

executing its powers, pass laws for the accomplishment

of objects not intrusted to the government; it would

become the painful duty of this tribunal, should a case

requiring such a decision come before it, to say, that

such an act was not the law of the land.

McCulloch, supra, 17 U.S. at 421, 423.

In light of United States v. South-Eastern Underwriters, 322 U.S. 533, 64 S.

Ct. 1162, 88 L. Ed. 1440 (1944), the “end” of regulating the health care insurance

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industry (including preventing insurers from excluding or charging higher rates to

people with pre-existing conditions) is clearly “legitimate” and “within the scope of

the constitution.” But, the means used to serve that end must be “appropriate,”

“plainly adapted,” and not “prohibited” or inconsistent “with the letter and spirit of

the constitution.” These phrases “are not merely hortatory.” Raich, supra, 545 U.S.

at 39 (Scalia, J., concurring in judgment).

The Necessary and Proper Clause cannot be utilized to “pass laws for the

accomplishment of objects” that are not within Congress’ enumerated powers. As

the previous analysis of the defendants’ Commerce Clause argument reveals, the

individual mandate is neither within the letter nor the spirit of the Constitution. To

uphold that provision via application of the Necessary and Proper Clause would

authorize Congress to reach and regulate far beyond the currently established

“outer limits” of the Commerce Clause and effectively remove all limits on federal

power. As the Supreme Court explained in Printz:

When a “Law . . . for carrying into Execution” the

Commerce Clause [violates other Constitutional

principles], it is not a “Law . . . proper for carrying into

Execution the Commerce Clause,” and is thus, in the

words of the Federalist, “merely an act of usurpation”

which “deserves to be treated as such.”

Printz, supra, 521 U.S. at 923-24 (citations and brackets omitted) (emphasis in

original); see also Comstock, supra, 130 S. Ct. at 1967-68 (“It is of fundamental

importance to consider whether essential attributes [of federalism embodied in the

Constitution] are compromised by the assertion of federal power under the

Necessary and Proper Clause; if so, that is a factor suggesting that the power is

not one properly within the reach of federal power.”) (Kennedy, J., concurring).

Here, the “essential attributes” of the Commerce Clause limitations on the federal

government’s power would definitely be compromised by this assertion of federal

power via the Necessary and Proper Clause. If Congress is allowed to define the

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scope of its power merely by arguing that a provision is “necessary” to avoid the

negative consequences that will potentially flow from its own statutory

enactments, the Necessary and Proper Clause runs the risk of ceasing to be the

“perfectly harmless” part of the Constitution that Hamilton assured us it was, and

moves that much closer to becoming the “hideous monster [with] devouring jaws”

that he assured us it was not.

The defendants have asserted again and again that the individual mandate is

absolutely “necessary” and “essential” for the Act to operate as it was intended by

Congress. I accept that it is.26 Nevertheless, the individual mandate falls outside the

boundary of Congress’ Commerce Clause authority and cannot be reconciled with a

limited government of enumerated powers. By definition, it cannot be “proper.”

(3) Constitutionality of the Individual Mandate

The individual mandate is outside Congress’ Commerce Clause power, and it

cannot be otherwise authorized by an assertion of power under the Necessary and

Proper Clause. It is not Constitutional. Accordingly, summary judgment must be

granted in favor of the plaintiffs on Count I.

(4) Severability

Having determined that the individual mandate exceeds Congress’ power

under the Commerce Clause, and cannot be saved by application of the Necessary

and Proper Clause, the next question is whether it is severable from the remainder

of the Act. In considering this issue, I note that the defendants have acknowledged

that the individual mandate and the Act’s health insurance reforms, including the

guaranteed issue and community rating, will rise or fall together as these reforms

“cannot be severed from the [individual mandate].” See, e.g., Def. Opp. at 40. As

explained in my order on the motion to dismiss: “the defendants concede that [the

26 As will be seen, the defendants’ repeated assertions on this point impact

the severability analysis.

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individual mandate] is absolutely necessary for the Act’s insurance market reforms

to work as intended. In fact, they refer to it as an ‘essential’ part of the Act at

least fourteen times in their motion to dismiss.” Thus, the only question is whether

the Act’s other, non-health-insurance-related provisions can stand independently or

whether they, too, must fall with the individual mandate.27

Severability is a doctrine of judicial restraint, and the Supreme Court has

applied and reaffirmed that doctrine just this past year: “‘Generally speaking, when

confronting a constitutional flaw in a statute, [courts] try to limit the solution to the

problem,’ severing any ‘problematic portions while leaving the remainder intact.’”

Free Enterprise Fund v. Public Co. Accounting Oversight Board, — U.S. —, 130 S.

Ct. 3138, 3161, 177 L. Ed. 2d 706 (2010) (citation omitted) (emphasis added).

Because the unconstitutionality of one provision of a legislative scheme “does not

necessarily defeat or affect the validity of its remaining provisions,” the “normal

rule” is that partial invalidation is proper. Id. (citations omitted) (emphasis added).

Where Congress has “enacted a statutory scheme for an obvious purpose, and

where Congress has included a series of provisions operating as incentives to

achieve that purpose, the invalidation of one of the incentives should not ordinarily

cause Congress’ overall intent to be frustrated.” New York, supra, 505 U.S. at 186

(emphasis added). As the emphasized text shows, the foregoing is not a rigid and

inflexible rule, but rather it is the general standard that applies in the typical case.

However, this is anything but the typical case.

The question of severability ultimately turns on the nature of the statute at

issue. For example, if Congress intended a given statute to be viewed as a bundle

of separate legislative enactment or a series of short laws, which for purposes of

27 In considering this issue, I will at times borrow heavily from one of the

amicus briefs filed in the case for it quite cogently and effectively sets forth the

applicable standard and governing analysis of severability (doc. 123).

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convenience and efficiency were arranged together in a single legislative scheme, it

is presumed that any provision declared unconstitutional can be struck and severed

without affecting the remainder of the statute. If, however, the statute is viewed

as a carefully-balanced and clockwork-like statutory arrangement comprised of

pieces that all work toward one primary legislative goal, and if that goal would be

undermined if a central part of the legislation is found to be unconstitutional, then

severability is not appropriate. As will be seen, the facts of this case lean heavily

toward a finding that the Act is properly viewed as the latter, and not the former.

The standard for determining whether an unconstitutional statutory provision

can be severed from the remainder of the statute is well-established, and it consists

of a two-part test. First, after finding the challenged provision unconstitutional, the

court must determine if the other provisions can function independently and remain

“fully operative as a law.” See Free Enterprise Fund, supra, 130 S. Ct. at 3161. In

a statute that is approximately 2,700 pages long and has several hundred sections

— certain of which have only a remote and tangential connection to health care —

it stands to reason that some (perhaps even most) of the remaining provisions can

stand alone and function independently of the individual mandate. The defendants

have identified several provisions that they believe can function independently: the

prohibition on discrimination against providers who will not furnish assisted suicide

services; an “Independence at Home” project for chronically ill seniors; a special

Medicare enrollment period for disabled veterans; Medicare reimbursement for

bone-marrow density tests; and provisions devised to improve women’s health,

prevent abuse, and ameliorate dementia [Def. Opp. at 40], as well as abstinence

education and disease prevention [doc. 74 at 14]. And as was mentioned during

oral argument, there is little doubt that the provision in the Act requiring employers

to provide a “reasonable break time” and separate room for nursing mothers to go

and express breast milk [Act § 4207] can function without the individual mandate.

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Importantly, this provision and many others are already in effect and functioning.

However, the question is not whether these and the myriad other provisions can

function as a technical or practical matter; instead, the “more relevant inquiry” is

whether these provisions will comprise a statute that will function “in a manner

consistent with the intent of Congress.” See Alaska Airlines, Inc. v. Brock, 480

U.S. 678, 685, 107 S. Ct. 1476, 94 L. Ed. 2d 661 (1987) (emphasis in original).

Thus, the first step in the severability analysis requires (at least to some extent)

that I try to infer Congress’ intent. Although many of the remaining provisions, as

just noted, can most likely function independently of the individual mandate, there

is nothing to indicate that they can do so in the manner intended by Congress. The

analysis at the second step of the severability test makes that conclusion pretty

clear.

At this second step, reviewing courts may look to “the statute’s text or

historical context” to determine if Congress, had it been presented with a statute

that did not contain the struck part, would have preferred to have no statute at all.

See Free Enterprise Fund, supra, 130 S. Ct. at 3161-62. “Unless it is evident that

the Legislature would not have enacted those provisions which are within its

power, independently of that which is not, the invalid part may be dropped if what

is left is fully operative as a law.” See Alaska Airlines, Inc., supra, 480 U.S. at 684.

But once again, that presupposes that the provisions left over function in a manner

consistent with the main objective and purpose of the statute in the first place. Cf.

New York, supra, 505 U.S. at 187 (unconstitutional provision held to be severable

where the remaining statute “still serves Congress’ objective” and the “purpose of

the Act is not defeated by the invalidation” of the unconstitutional provision)

(emphasis added). While this inquiry “can sometimes be ‘elusive’” [Free Enterprise

Fund, supra, 130 S. Ct. at 3161], on the unique facts of this particular case, the

record seems to strongly indicate that Congress would not have passed the Act in

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its present form if it had not included the individual mandate. This is because the

individual mandate was indisputably essential to what Congress was ultimately

seeking to accomplish. It was, in fact, the keystone or lynchpin of the entire health

reform effort. After looking at the “statute’s text” (or, rather, its conspicuous lack

of text) and the “historical record” [see Free Enterprise Fund, supra, 130 S. Ct. at

3162], there are two specific facts that are particularly telling in this respect.

First, the Act does not contain a “severability clause,” which is commonly

included in legislation to provide that if any part or provision is held invalid, then

the rest of the statute will not be affected. Although it is true that the absence of

such a clause, in and of itself, “does not raise a presumption against severability,”

[New York, supra, 505 U.S. at 186], that is not the same thing as saying that its

absence is irrelevant to the analysis. In INS v. Chadha, 462 U.S. 919, 103 S. Ct.

2764, 77 L. Ed. 2d 317 (1983), for example, the Supreme Court concluded that it

did not have to embark on the “elusive inquiry” of whether Congress intended the

unconstitutional provision in that case to be severable from the rest of the statute

because Congress included a severability clause with language that was plain and

unambiguous. See id. at 931-32. And, in Alaska Airlines, Inc., supra, 480 U.S. at

686, the Court similarly held that the severability analysis is “eased” when there is

a severability clause in the statute, such that only “strong evidence” can overcome

it. By necessary implication, the evidence against severability need not be as strong

to overcome the general presumption when there is no such clause.

The lack of a severability clause in this case is significant because one had

been included in an earlier version of the Act, but it was removed in the bill that

subsequently became law. “Where Congress includes [particular] language in an

earlier version of a bill but deletes it prior to enactment, it may be presumed that

the [omitted provision] was not intended.” Russello v. United States, 464 U.S. 16,

23-24, 104 S. Ct. 296, 78 L. Ed. 2d 17 (1983). In other words, the severability

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clause was intentionally left out of the Act. The absence of a severability clause is

further significant because the individual mandate was controversial all during the

progress of the legislation and Congress was undoubtedly well aware that legal

challenges were coming. Indeed, as noted earlier, even before the Act became law,

several states had passed statutes declaring the individual mandate unconstitutional

and purporting to exempt their residents from it; and Congress’ own attorneys in

the CRS had basically advised that the challenges might well have legal merit as it

was “unclear” if the individual mandate had “solid constitutional foundation.” See

CRS Analysis, supra, at 3. In light of the foregoing, Congress’ failure to include a

severability clause in the Act (or, more accurately, its decision to not include one

that had been included earlier) can be viewed as strong evidence that Congress

recognized the Act could not operate as intended without the individual mandate.

Moreover, the defendants have conceded that the Act’s health insurance

reforms cannot survive without the individual mandate, which is extremely

significant because the various insurance provisions, in turn, are the very heart of

the Act itself. The health insurance reform provisions were cited repeatedly during

the health care debate, and they were instrumental in passing the Act. In speech

after speech President Obama emphasized that the legislative goal was “health

insurance reform” and stressed how important it was that Congress fundamentally

reform how health insurance companies do business, and “protect every American

from the worst practices of the insurance industry.” See, for example, Remarks of

President Obama, The State of the Union, delivered Jan. 27, 2009.28 Meanwhile,

28 See also, e.g., The White House, Office of the Press Secretary, Official

Transcript of President Obama’s News Conference, July 22, 2009, available at:

http://www.whitehouse.gov/the-press-office/news-conference-president-july-22-20

09; The White House, Office of the Press Secretary, Official Transcript of President

Obama’s Remarks at Health Care Reform Town Hall, July 23, 2009, available at:

http://www.whitehouse.gov/the_press_office/Remarks-by-the-President-at-Health-C

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the Act’s supporters in the Senate and House similarly spoke repeatedly and often

of the legislative efforts as being the means to comprehensively reform the health

insurance industry.29

To be sure, the words “protection” and “affordable” in the title of the Act

itself are inextricably tied to the health insurance reform provisions (and the

individual mandate in particular), as the defendants have emphasized throughout

the course of this litigation. See, e.g., Def. Mem. at 1 (“Focusing on insurance

industry practices that prevented millions of Americans from obtaining affordable

insurance, the Act bars insurers from denying coverage to those with pre-existing

conditions or from charging discriminatory premiums on the basis of medical

history. Congress recognized that these reforms of insurance industry practices

were required to protect consumers . . . “) (emphasis added); Reply in Support of

Defendants’ Motion to Dismiss, filed August 27, 2010 (doc. 74), at 21 (stating

that the individual mandate “is necessary for Congress’s insurance reforms to

work”; that “those provisions protect millions of Americans”; and that “Congress

plainly regarded their protection as a core objective of the Act”) (emphasis added).

The defendants have further identified and highlighted the essential role that the

individual mandate played in the overall regulatory reform of the interstate health

care and health insurance markets:

[T]he [individual mandate] is essential to the Act’s

are-Reform-Town-Hall/.

29 See, e.g., David Welna, Analyzing Democrats’ Word Shift on Health Care,

National Public Radio, Nov. 17, 2009 (reporting that during the health care reform

debate the Act’s proponents referred to the ongoing efforts as “health insurance

reform,” which, according to the head of a nonpartisan health care organization, “is

a much more accurate label” as the “health care makeover has ended up being

largely about [reforming] insurance companies”), available at

http://www.npr.org/templates/story/story.php?storyId=120464701.

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comprehensive scheme to ensure that health insurance

coverage is available and affordable. In addition to

regulating industry underwriting practices, the Act

promotes availability and affordability through (a) “health

benefit exchanges” that enable individuals and small

businesses to obtain competitive prices for health

insurance; (b) financial incentives for employers to offer

expanded insurance coverage, (c) tax credits to lowincome

and middle-income individuals and families, and

(d) extension of Medicaid to additional low-income

individuals. The [individual mandate] works in tandem

with these and other reforms. . . .

Congress thus found that failure to regulate the decision

to forgo insurance . . . would undermine the

“comprehensive regulatory regime” in the Act. . . .

[The individual mandate] is essential to Congress’s overall

regulatory reform of the interstate health care and health

insurance markets . . . is “essential” to achieving key

reforms of the interstate health insurance market . . .

[and is] necessary to make the other regulations in the

Act effective.

Memorandum in Support of Defendants’ Motion to Dismiss, filed June 17, 2010

(doc. 56-1), at 46-48 (emphasis added).

Congress has also acknowledged in the Act itself that the individual mandate

is absolutely “essential” to the Act’s overarching goal of expanding the availability

of affordable health insurance coverage and protecting individuals with pre-existing

medical conditions:

[I]f there were no [individual mandate], many individuals

would wait to purchase health insurance until they

needed care . . . The [individual mandate] is essential to

creating effective health insurance markets in which

improved health insurance products that are guaranteed

issue and do not exclude coverage of pre-existing

conditions can be sold.

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Act § 1501(a)(2)(I) (emphasis added).

In other words, the individual mandate is indisputably necessary to the Act’s

insurance market reforms, which are, in turn, indisputably necessary to the purpose

of the Act. This is obviously a very different situation than in Alaska Airlines, Inc.,

supra, 480 U.S. at 694 n.18 and 696 (unconstitutional provision severed from rest

of statute where the provision was “uncontroversial,” and the debate on the final

bill demonstrated its “relative unimportance”), and is more in line with the situation

alluded to in New York, supra, 505 U.S. at 187 (suggesting by implication that the

entire legislation should be struck when “the purpose of the Act is . . . defeated by

the invalidation” of one of its provisions).

In weighing the Act’s provisions and attempting to discern legislative intent

and purpose, I have kept in mind the rationale underlying the severability doctrine,

which the Supreme Court has described as follows:

Three interrelated principles inform our approach to

remedies. First, we try not to nullify more of a

legislature’s work than is necessary, for we know that a

ruling of unconstitutionality frustrates the intent of the

elected representatives of the people. . . . Second,

mindful that our constitutional mandate and institutional

competence are limited, we restrain ourselves from

rewriting [a] law to conform it to constitutional

requirements even as we strive to salvage it . . . Third,

the touchstone for any decision about remedy is

legislative intent, for a court cannot use its remedial

powers to circumvent the intent of the legislature.

Ayotte v. Planned Parenthood of Northern New England, 546 U.S. 321, 329-30,

126 S. Ct. 961, 163 L. Ed. 2d 812 (2006) (citations and brackets omitted). The

first principle merely reflects the general judicial policy discussed at the beginning

of this section; that is, because a ruling of unconstitutionality frustrates the intent

of democratically-elected representatives of the people, the “normal rule” — in the

“normal” case — will ordinarily require that as little of a statute be struck down as

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possible. The two other principles, however, require closer analysis.

As for the second principle, the Ayotte Court explained:

Our ability to devise a judicial remedy that does not entail

quintessentially legislative work often depends on how

clearly we have already articulated the background

constitutional rules at issue . . . But making distinctions in

a murky constitutional context, or where line-drawing is

inherently complex, may call for a “far more serious

invasion of the legislative domain” than we ought to

undertake.

Supra, 546 U.S. at 329-30. Thus, cleanly and clearly severing an unconstitutional

provision is one thing, but having to re-balance a statutory scheme by engaging in

quasi-legislative “line drawing” is a “‘far more serious invasion of the legislative

domain’” than courts should undertake. See id. This analysis merges into the third

principle identified in Ayotte:

After finding an application or portion of a statute

unconstitutional, we must next ask: Would the legislature

have preferred what is left of its statute to no statute at

all? All the while, we are wary of legislatures who would

rely on our intervention, for it would certainly be

dangerous if the legislature could set a net large enough

to catch all possible offenders, and leave it to the courts

to step inside to announce to whom the statute may be

applied. This would, to some extent, substitute the

judicial for the legislative department of the government.

Id. at 330 (citations and brackets omitted).

Severing the individual mandate from the Act along with the other insurance

reform provisions — and in the process reconfiguring an exceedingly lengthy and

comprehensive legislative scheme — cannot be done consistent with the principles

set out above. Going through the 2,700-page Act line-by-line, invalidating dozens

(or hundreds) of some sections while retaining dozens (or hundreds) of others,

would not only take considerable time and extensive briefing, but it would, in the

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end, be tantamount to rewriting a statute in an attempt to salvage it, which is

foreclosed by Ayotte, supra. Courts should not even attempt to do that. It would

be impossible to ascertain on a section-by-section basis if a particular statutory

provision could stand (and was intended by Congress to stand) independently of

the individual mandate. The interoperative effects of a partial deletion of legislative

provisions are often unforseen and unpredictable. For me to try and “second guess”

what Congress would want to keep is almost impossible. To highlight one of many

examples, consider the Internal Revenue Service Form 1099 reporting requirement,

which requires that businesses, including sole proprietorships, issue 1099 tax

forms to individuals or corporations to whom or which they have paid more than

$600 for goods or services in any given tax year [Act § 9006]. This provision has

no discernable connection to health care and was intended to generate offsetting

revenue for the Act, the need of which is greatly diminished in the absence of the

“health benefit exchanges,” subsidies and tax credits, and Medicaid expansion (all

of which, as the defendants have conceded, “work in tandem” with the individual

mandate and other insurance reform provisions). How could I possibly determine if

Congress intended the 1099 reporting provision to stand independently of the

insurance reform provisions? Should the fact that it has been widely criticized by

both Congressional supporters and opponents of the Act and the fact that there

have been bipartisan efforts to repeal it factor at all into my determination?

In the final analysis, this Act has been analogized to a finely crafted watch,

and that seems to fit. It has approximately 450 separate pieces, but one essential

piece (the individual mandate) is defective and must be removed. It cannot function

as originally designed. There are simply too many moving parts in the Act and too

many provisions dependent (directly and indirectly) on the individual mandate and

other health insurance provisions — which, as noted, were the chief engines that

drove the entire legislative effort — for me to try and dissect out the proper from

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the improper, and the able-to-stand-alone from the unable-to-stand-alone. Such a

quasi-legislative undertaking would be particularly inappropriate in light of the fact

that any statute that might conceivably be left over after this analysis is complete

would plainly not serve Congress’ main purpose and primary objective in passing

the Act. The statute is, after all, called “The Patient Protection and Affordable Care

Act,” not “The Abstinence Education and Bone Marrow Density Testing Act.” The

Act, like a defectively designed watch, needs to be redesigned and reconstructed

by the watchmaker.

If Congress intends to implement health care reform — and there would

appear to be widespread agreement across the political spectrum that reform is

needed — it should do a comprehensive examination of the Act and make a

legislative determination as to which of its hundreds of provisions and sections will

work as intended without the individual mandate, and which will not. It is Congress

that should consider and decide these quintessentially legislative questions, and not

the courts.

In sum, notwithstanding the fact that many of the provisions in the Act can

stand independently without the individual mandate (as a technical and practical

matter), it is reasonably “evident,” as I have discussed above, that the individual

mandate was an essential and indispensable part of the health reform efforts, and

that Congress did not believe other parts of the Act could (or it would want them

to) survive independently. I must conclude that the individual mandate and the

remaining provisions are all inextricably bound together in purpose and must stand

or fall as a single unit. The individual mandate cannot be severed. This conclusion

is reached with full appreciation for the “normal rule” that reviewing courts should

ordinarily refrain from invalidating more than the unconstitutional part of a statute,

but non-severability is required based on the unique facts of this case and the

particular aspects of the Act. This is not a situation that is likely to be repeated.

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(5) Injunction

The last issue to be resolved is the plaintiffs’ request for injunctive relief

enjoining implementation of the Act, which can be disposed of very quickly.

Injunctive relief is an “extraordinary” [Weinberger v. Romero-Barcelo, 456

U.S. 305, 312, 102 S. Ct. 1798, 72 L. Ed. 2d 91 (1982)], and “drastic” remedy

[Aaron v. S.E.C., 446 U.S. 680, 703, 100 S. Ct. 1945, 64 L. Ed. 2d 611 (1980)

(Burger, J., concurring)]. It is even more so when the party to be enjoined is the

federal government, for there is a long-standing presumption “that officials of the

Executive Branch will adhere to the law as declared by the court. As a result, the

declaratory judgment is the functional equivalent of an injunction.” See Comm. on

Judiciary of U.S. House of Representatives v. Miers, 542 F.3d 909, 911 (D.C. Cir.

2008); accord Sanchez-Espinoza v. Reagan, 770 F.2d 202, 208 n.8 (D.C. Cir.

1985) (“declaratory judgment is, in a context such as this where federal officers

are defendants, the practical equivalent of specific relief such as an injunction . . .

since it must be presumed that federal officers will adhere to the law as declared

by the court”) (Scalia, J.) (emphasis added).

There is no reason to conclude that this presumption should not apply here.

Thus, the award of declaratory relief is adequate and separate injunctive relief is

not necessary.

CONCLUSION

The existing problems in our national health care system are recognized by

everyone in this case. There is widespread sentiment for positive improvements

that will reduce costs, improve the quality of care, and expand availability in a way

that the nation can afford. This is obviously a very difficult task. Regardless of how

laudable its attempts may have been to accomplish these goals in passing the Act,

Congress must operate within the bounds established by the Constitution. Again,

this case is not about whether the Act is wise or unwise legislation. It is about the

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Constitutional role of the federal government.

For the reasons stated, I must reluctantly conclude that Congress exceeded

the bounds of its authority in passing the Act with the individual mandate. That is

not to say, of course, that Congress is without power to address the problems and

inequities in our health care system. The health care market is more than one sixth

of the national economy, and without doubt Congress has the power to reform and

regulate this market. That has not been disputed in this case. The principal dispute

has been about how Congress chose to exercise that power here.30

Because the individual mandate is unconstitutional and not severable, the

entire Act must be declared void. This has been a difficult decision to reach, and I

am aware that it will have indeterminable implications. At a time when there is

virtually unanimous agreement that health care reform is needed in this country, it

is hard to invalidate and strike down a statute titled “The Patient Protection and

Affordable Care Act.” As Judge Luttig wrote for an en banc Fourth Circuit in

30 On this point, it should be emphasized that while the individual mandate

was clearly “necessary and essential” to the Act as drafted, it is not “necessary

and essential” to health care reform in general. It is undisputed that there are

various other (Constitutional) ways to accomplish what Congress wanted to do.

Indeed, I note that in 2008, then-Senator Obama supported a health care reform

proposal that did not include an individual mandate because he was at that time

strongly opposed to the idea, stating that “if a mandate was the solution, we can

try that to solve homelessness by mandating everybody to buy a house.” See

Interview on CNN’s American Morning, Feb. 5, 2008, transcript available at:

http://transcripts.cnn.com/TRANSCRIPTS/0802/05/ltm.02.html. In fact, he pointed

to the similar individual mandate in Massachusetts — which was imposed under the

state’s police power, a power the federal government does not have — and opined

that the mandate there left some residents “worse off” than they had been before.

See Christopher Lee, Simple Question Defines Complex Health Debate, Washington

Post, Feb. 24, 2008, at A10 (quoting Senator Obama as saying: “In some cases,

there are people [in Massachusetts] who are paying fines and still can’t afford

[health insurance], so now they’re worse off than they were . . . They don’t have

health insurance, and they’re paying a fine . . .”).

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striking down the “Violence Against Women Act” (before the case was appealed

and the Supreme Court did the same):

No less for judges than for politicians is the temptation to

affirm any statute so decorously titled. We live in a time

when the lines between law and politics have been

purposefully blurred to serve the ends of the latter. And,

when we, as courts, have not participated in this most

perniciously machiavellian of enterprises ourselves, we

have acquiesced in it by others, allowing opinions of law

to be dismissed as but pronouncements of personal

agreement or disagreement. The judicial decision making

contemplated by the Constitution, however, unlike at

least the politics of the moment, emphatically is not a

function of labels. If it were, the Supreme Court assuredly

would not have struck down the “Gun-Free School Zones

Act,” the “Religious Freedom Restoration Act,” the “Civil

Rights Act of 1871,” or the “Civil Rights Act of 1875.”

And if it ever becomes such, we will have ceased to be a

society of law, and all the codification of freedom in the

world will be to little avail.

Brzonkala, supra, 169 F.3d at 889.

In closing, I will simply observe, once again, that my conclusion in this case

is based on an application of the Commerce Clause law as it exists pursuant to the

Supreme Court’s current interpretation and definition. Only the Supreme Court (or a

Constitutional amendment) can expand that.

For all the reasons stated above and pursuant to Rule 56 of the Federal Rules

of Civil Procedure, the plaintiffs’ motion for summary judgment (doc. 80) is hereby

GRANTED as to its request for declaratory relief on Count I of the Second

Amended Complaint, and DENIED as to its request for injunctive relief; and the

defendants’ motion for summary judgment (doc. 82) is hereby GRANTED on Count

IV of the Second Amended Complaint. The respective cross-motions are each

DENIED.

In accordance with Rule 57 of the Federal Rules of Civil Procedure and Title

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28, United States Code, Section 2201(a), a Declaratory Judgment shall be entered

separately, declaring “The Patient Protection and Affordable Care Act”

unconstitutional.

DONE and ORDERED this 31st day of January, 2011.

/s/ Roger Vinson

ROGER VINSON

Senior United States District Judge

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