Wednesday, January 30, 2019

Gun Rights Outside the Home: Supreme Court Grants Review in NYC Unloaded Carry Case

By Will Foster

Last Tuesday the Supreme Court agreed to review the Second Circuit’s decision in New York State Rifle & Pistol Association Inc. v. City of New York, New York. The case concerns whether certain New York City restrictions on the transport of licensed, locked, and unloaded handguns violate the Constitution. The challengers’ main argument against the restrictions is rooted in their Second Amendment right to keep and bear arms. They also claim that the city policies violate the Commerce Clause and the right to travel protected by the Privileges and Immunities Clause. A three-judge panel on the Second Circuit unanimously upheld the restrictions last February, affirming the judgement of the district court below.

The Supreme Court’s announcement to review will make this the first Second Amendment case the justices have decided since 2016’s Caetano v. Massachusetts — a terse and narrow opinion (with no recorded dissents) that suggested the Second Amendment applies to stun guns.

Before Caetano, one has to go all the way back to 2010 to find another right to arms ruling in the Supreme Court. That year, in McDonald v. Chicago, the court voted 5-4 to incorporate the Second Amendment against the states. McDonald built on the landmark 2008 ruling in District of Columbia v. Heller, which held that the Second Amendment protected, at a minimum, an individual right to keep common weapons in the home and use them there for self-defense. Because Heller was such a recent decision, it is only within the last decade or so that many courts have begun to seriously entertain challenges to firearms restrictions. That’s why gun rights jurisprudence is underdeveloped compared to the extensive body of law on many other Bill of Rights provisions.

Now we come to New York State Rifle & Pistol Ass’n. Inc. The dispute here is narrow in many respects. Unlike, say, Peruta v. California (a case the court declined to hear in 2017), New York State does not concern a right to carry arms in public for self-defense. Instead, this case merely concerns whether the right to keep and bear arms includes a right to transport unloaded, lawfully-owned guns between a primary home and a second home, or between a residence and a shooting range, when that transportation crosses the New York City border.

New York law recognizes two major types of handgun licenses: premises licenses and carry licenses. Ordinary citizens of the state cannot obtain a general carry license, so a premises license is their only real option. This kind of license entitles them to possess a handgun in a designated residence or business. Beyond that, however, local authorities (who issue the licenses) have significant discretion to decide how far the licenses’ privileges extend. State law allows holders of a premises license registered to one location to use their firearms elsewhere in the state for lawful purposes, but only to the extent that the issuing locality permits them to do so.

New York City’s premises license application involves a mental health assessment, a crosscheck of the applicant’s statements on the license application, a criminal records check, and a fee. The city has chosen to allow holders of premises licenses to transport their guns to and from city shooting ranges, in addition to keeping their guns within their city residences. However, that authorization does not extend to the transport of handguns to ranges or second homes outside the city. As a result, ordinary residents of New York City are prohibited from transporting their lawfully-owned handguns to locations outside of the city — even if the guns are unloaded and locked in a case separate from their ammunition.

As far as I can tell, nothing in state law mandates this policy; it was imposed at the city’s discretion. It is apparently the only prohibition of its kind in the country. Ultimately, in my view, this case should be a slam-dunk for the challengers. Under any level of scrutiny (except perhaps rational basis review, which is clearly inappropriate), and taking existing Supreme Court precedent as a given (as both parties have), the prohibition must fall. Heller held that the Second Amendment protects a right to keep a handgun in the home for self-defense, and as the 19th century constitutional scholar Thomas Cooley explained, “To bear arms implies something more than the mere keeping; it implies learning to handle and use them in a way that makes those who keep them ready for their efficient use.” Heller makes plain that Second Amendment rights extend to both of the activities the New York State petitioners seek to engage in: self-defense within the home and honing skill at the range.

New York responds that its policy doesn’t significantly burden those interests because premises license holders with second homes outside the city are free to purchase (and get a license for) a second gun to be stored at that residence, and license holders who want to shoot at ranges outside the city are probably able to rent guns there.

This reasoning has serious holes. It seems unlikely that the Court would allow a prohibition on the transport of books to locations outside city limits because people can still buy second copies of the books near their destination. Any judge would see that as an untenable restriction on First Amendment rights. There is no reason to treat New York State any differently just because it deals with the Second Amendment rather than the First. (That is not to say there might not be some circumstances, e.g. where strong evidence exists of a danger to public safety, where disparate treatment could be appropriate.)

Essentially, the challengers assert that they would prefer to use the same handguns no matter where they are, and that out-of-city ranges (particularly those elsewhere in New York, plus those in New Jersey) may be more convenient for them than in-city ones. Their views are entitled to respect, particularly given that several national law enforcement organizations have filed a brief in the Supreme Court supporting the challengers. The brief explains why it is sensible to want to use the same handgun for all purposes, and to want to sometimes patronize firing ranges other than the seven located within New York City.

Of course, fairly evaluating a law requires us to examine not only the harms it has caused but also the government interests that it serves. But this particular restriction doesn’t seem to relate to any important government interests. The city argues that their current premises license policy is necessary because when the policy used to be more lenient – allowing transport to any shooting range in the state – it proved harder to catch people who were violating the policy. City police had a hard time figuring out whether people were lying when they said they were traveling to a range. But this argument is wholly inapt. The city has never offered anything beyond weakly supported statements and hypotheses (e.g., unloaded guns could be loaded and become dangerous in the heat of road rage incidents) to suggest that policy violations have caused or will cause actual harm to people.

As the law enforcement organizations’ brief explains, “The rationale is circular. Respondents attempt to justify the regulation by noting that people sometimes violate it. But neither Respondents’ evidence nor the Second Circuit’s opinion contains a single factual instance that any violation of the Rule has caused actual harm or injury to public safety.” Indeed, if the only problem is that people sometimes violate the policy, then the problem could be solved by making the policy more permissive. Then there would presumably be fewer violations.

Plus, any public safety justification is undermined by the fact that in every other state, owners of licensed handguns can transport their weapons throughout the state so long as they are unloaded. Federal law meanwhile permits the transportation of properly stored handguns across state lines. If this practice really poses a danger to public safety, why does no other jurisdiction besides New York City prohibit it?

The petitioners also argue that the city’s policy violates not just the Second Amendment, but also the Commerce Clause and the Privileges and Immunities Clause. As for those issues, petitioners note that “[i]f the City had banned its golfers from taking their clubs to out-of-state courses or its professional musicians from taking their instruments to out-of-state concert halls, it is hard to imagine that those restrictions on interstate commerce and travel would be tolerated.” The city concedes this point, but responds that “unlike golf clubs and musical instruments, firearms present public safety risks that the City has a legitimate interest in protecting against.” Although this is true, it’s also true that, unlike golf clubs and musical instruments, guns are explicitly protected by the constitutional text.

The city maintains that its policy has no extraterritorial effect (which would be forbidden under the modern “dormant” Commerce Clause doctrine) because it only restricts transport of firearms “within the City.” While New York is technically correct here, its argument seems rather sophistic. Sure, a resident of New York City can use their licensed gun at a range in another state …. they’re just prohibited from actually bringing the gun there. And the Supreme Court held in Healy v. Beer Institute, Inc. (1989) that “a state law that has the ‘practical effect’ of regulating commerce occurring wholly outside that State’s borders is invalid under the Commerce Clause.”

Even though the Connecticut beer statute challenged in Healy only directly regulated prices that could be charged in-state, it had the practical effect of controlling out-of-state prices. “The critical inquiry,” the court said, “is whether the practical effect of the regulation is to control conduct beyond the boundaries of the State.” Here such a practical effect plainly exists. Furthermore, Pike v. Bruce Church, Inc. (1970) confirms that even a legitimate government interest is not necessarily enough to save a statute from a dormant Commerce Clause challenge: “Where [a] statute regulates evenhandedly to effectuate a legitimate local public interest, and its effects on interstate commerce are only incidental, it will be upheld unless the burden imposed on such commerce is clearly excessive in relation to the putative local benefits” (emphasis added). Here, the burden is indeed “clearly excessive,” since the restriction’s public safety benefits are minimal.

The city also argues that their ban creates only “a minor restriction on travel.” Yet as the challengers point out, “‘if the City passed a regulation prohibiting its citizens from leaving their residences with an iPhone, it could not maintain with a straight face that such a statute did not infringe ‘the right of a citizen of one State to enter and to leave another State.’” (quoting Saenz v. Roe (1999)). While the city is of course correct that, as a formal matter, a ban on traveling with certain items does not prevent people from traveling without those items, such a ban can discourage travel and therefore may violate the Constitution as interpreted by the Supreme Court. The challengers explain, “There can be no doubt that the transport ban ‘deters’ travel, as petitioners have represented that they would travel out of the city and state but for this regulation.”

While a victory for the challengers seems virtually certain here, it will be interesting to see what the final vote is. As Caetano demonstrates, the court’s four more liberal justices may be willing to join an opinion that vindicates gun rights as long as the holding is sufficiently narrow. In any event, after six years of litigation, it is past time for petitioners’ rights to finally be vindicated.


Monday, January 28, 2019

by Anna Salvatore

During the 34-day government shutdown, I wondered how the Supreme Court would function when it ran out of money. Would the Court eventually have to stop hearing cases? Who would get paid and who wouldn’t?

Stephen Wermiel, a law professor at American University, answered all my questions in this SCOTUSblog post. He wrote that the Anti-Deficiency Act prevents the federal government from spending money that Congress hasn’t appropriated. However, employees can keep working if their output is “necessary,” and federal judges belong in this category because they get their authority from Article III of the Constitution.

Then he explores what this means “as a practical matter”:

First, the Supreme Court and the lower federal courts must be able to continue to perform their core function of deciding cases. For the Supreme Court, that means continuing to receive petitions for certiorari and vote on which of them to grant or deny. It also means continuing to hear oral arguments, although none are scheduled until February 19, when the court concludes its current recess. And it means deciding the argued cases, although again, no new opinions are likely until after the recess.

Second, the Constitution adds another twist to this process. Because Article III says that the salary of Supreme Court justices cannot be reduced, the justices must continue to be paid for their work during this period. The same holds true for federal appeals court and federal district court judges.

Third, when the money runs out next week, and if there is still no appropriation, court staff will be split into two groups. Employees whose work is essential to the core mission of the Supreme Court will have to continue working, presumably with the expectation that they will receive back pay when an appropriation eventually comes through. But other workers who may not be essential to those core functions will have to be furloughed.

Check out the full article, which I’ve hyperlinked above, if you want more details. It may be especially salient if the government shuts down again in the near future.

Friday, January 25, 2019

By Anna Salvatore

I was hoping that the justices would hear Kennedy v. Bremerton, a case about a high school football coach who claims that he was fired for praying post-game, because it would’ve provided a great mix of high school and Supreme-Court-related content. Yet the Court declined to hear Kennedy on Tuesday, with the four conservative justices citing concerns about the factual record. Their biggest qualm was that the lower court didn’t definitively say whether the school district fired Coach Kennedy for praying or for neglecting to supervise his students. Until the justices knew for sure, they were unwilling to delve into the important constitutional issues at stake.

First, some context. Patrick Kennedy served as the assistant football coach for Bremerton High School from 2008 to 2015. As a Christian, he felt compelled to pray at the end of each football game to give thanks “for player safety, sportsmanship, and spirited competition” (cert petition). Sometimes students would join him in prayer, although he didn’t invite them to do so. Then, as more team members began praying with him, Kennedy made nonsectarian religious pep talks. These practices got him into some trouble in September 2015, when an employee from an other high school complained to BHS administrators about the post-game gatherings. Soon the BHS superintendent was investigating whether Kennedy had complied with the district’s religion-related protocol.

The superintendent told Kennedy that he was allowed to pray post-game, as long as praying didn’t interfere with his job responsibilities, but students would not be permitted to join him. The superintendent also advised Kennedy to pray in a non-demonstrative way “to avoid the perception of endorsement [of religion].” To make a long story short, Kennedy didn’t follow this advice. He prayed on several more occasions until he was placed on administrative leave in November 2015. The district explained that he had flouted their religious policy, and that by praying while he was on-duty, he had also neglected his supervisory duties over his players.

Kennedy sued Bremerton in August 2016, claiming that it had violated his rights under the First Amendment and Title VII of the Civil Rights Act. He argued that he wasn’t speaking as a coach but as a private citizen when he prayed post-game. The Court of Appeals for the Ninth Circuit disagreed. It said that when public employees engage in speech that’s part of their official duties, they are not speaking as private citizens and their speech is thus subject to employer discipline. Because Kennedy’s responsibilities included “modeling good behavior while acting in an official capacity” in front of students and spectators, the Ninth Circuit held that his prayers were unprotected speech.

On Tuesday, Justices Alito, Thomas, Gorsuch, and Kavanaugh expressed their disagreement with the Ninth Circuit’s holding:

The Ninth Circuit’s opinion applies our decision in Garcetti v. Ceballos, 547 U. S. 410 (2006), to public school teachers and coaches in a highly tendentious way. According to the Ninth Circuit, public school teachers and coaches may be fired if they engage in any expression that the school does not like while they are on duty, and the Ninth Circuit appears to regard teachers and coaches as being on duty at all times from the moment they report for work to the moment they depart, provided that they are within the eyesight of students. Under this interpretation of Garcetti, if teachers are visible to a student while eating lunch, they can be ordered not to engage in any “demonstrative” conduct of a religious nature, such as folding their hands or bowing their heads in prayer. And a school could also regulate what teachers do during a period when they are not teaching by preventing them from reading things that might be spotted by students or saying things that might be overheard.

I think they’re kind of right. Garcetti held that employers can’t unduly limit their employees’ speech by creating excessively broad job descriptions. “The listing of a given task [in a job description],” the 5-4 majority wrote, “is neither necessary nor sufficient to demonstrate that [the employee’s speech] is within the scope of [his or her] professional duties.” So perhaps the Ninth Circuit erred here by allowing the school district to invoke Coach Kennedy’s broad job description to punish him. Modeling good behavior is a vague requirement, and it gives the district too much power to restrict seemingly non-professional speech such as prayers.

On the other hand, I’m not sure that the Ninth Circuit’s opinion was “highly tendentious.” Consider the following sentence from Garcetti: “Restricting speech that owes its existence to a public employee’s professional responsibilities does not infringe any liberties the employee might have enjoyed as a private citizen.” The question is, did Kennedy’s speech owe its existence to his professional responsibilities? And one could reasonably answer ‘yes.’ If Kennedy wasn’t a football coach, he wouldn’t have had access to the fifty yard line of the football field. Nor would he have been able to lead students in prayer or give them motivational talks. So even though Ninth Circuit judges may have slightly misinterpreted Garcetti, I don’t think it’s fair to accuse them of improper bias.

Now onto the final paragraph of the conservative justices’ statement. There they made “huge news,” according to Steven Mazie of the Economist, by casting doubt on Employment Division v. Smith. The landmark 1990 case held that facially neutral and generally applicable laws are constitutional even if they forbid some religious conduct. Although the opinion was written by Justice Scalia, many conservatives now think that it undercuts the Free Exercise Clause, which says that “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof.” Count the Supreme Court’s right wing in this camp, as they said on Tuesday that Smith “drastically” limits Free Exercise protections.

Will the Court revisit Smith soon? Hard to say. It would take five votes to overturn the precedentand Chief Justice Roberts didn’t sign on to this statement. I hate to end this post with the boilerplate phrase, “We’ll have to wait and see,” but that’s all we can do until the Court makes its next move on Free Exercise.

Sunday, January 20, 2019

Fighting the CFPB: The Constitutional Merits of Single-Head Agencies

by Curtis Herbert

In the past couple of years, a slew of legal challenges have arisen about whether  administrative agencies are constitutionally structured. In other words, are agency heads so far removed from oversight that they violate separation of powers principles? And does the fact that one person is in control make the agency constitutionally dubious? Today I will scrutinize one line of cases concerning the Consumer Finance Protection Bureau.

The CFPB is an agency that is at once usual and unusual. It is tasked with defending consumers from unlawful business dealings. Like most agencies, it handles complaints, answers questions, and issues press releases. It even runs its own blog. What makes this agency ripe for litigation, however, is that it’s headed by only one person: Director Kathy Kraninger. She runs an agency that wields an awesome array of powers. It enforces regulations (which it creates) against companies such as Capital One Bank, Wells Fargo, and State Farm; sends warning letters; and conducts research. But with great power comes great litigation, and in the fall of 2016 the D.C. Circuit dealt a devastating blow to the CFPB.

In a majority opinion by then-judge Kavanaugh, the circuit court ruled against the CFPB. For reasons that will soon become evident, the court ruled that agencies have become “a headless fourth branch of the U.S. Government,” and that they “pose a significant threat to individual liberty and to the constitutional system of separation of powers and checks and balances.” The court looked to history for guidance, recognizing that agencies have typically been led by a divided panel rather than a vigorous executive. Then, citing a couple of Supreme Court cases, it concluded that the lack of historical precedent for a single director casts doubt on the CFPB’s legitimacy. The majority also contended that the concentration of power in a single director, combined with a lack of direct executive oversight, forms a position of nigh-unprecedented power, and thus constitutes a grave danger to the separation of powers. The final blow came when the majority declined to extend Humphrey’s Executor v. United States (1935), where the Supreme Court held that executive agency heads with quasi-legislative powers can’t be fired without Congress’s consent. 

But the CFPB would live to fight another day. The D.C. Circuit granted en banc review, which means that the entire circuit reviews a case that a three-member panel had previously decided. Then the full court overturned Kavanaugh’s ruling. In contrast with the original opinion, the en banc majority extended Humphrey’s Executor. It  found no precedent-based attack on the structure of the CFPB.

The dissenters countered with their own argument: “Humphrey’s Executor remains the exception, not the rule, and it does not apply here.” They attempted to distinguish Humphrey’s Executor from the CFPB case by examining the former’s underlying facts. First, the CFPB, as opposed to the FTC, has one director rather than a multi-member panel. Plus, the CFPB is further insulated from oversight through a provision that ensures limited accountability to Congress. While “the FTC must go to the Congress every year with a detailed budget request explaining its expenditure of public money,” the CFPB is, “As the agency itself declares, . . .  fund[ed] outside of the congressional appropriations process to ensure full independence.” The new dissenters cite a particularly funny exchange from a congressional hearing, where upon being asked who gave the go-ahead for a $200+ million project, the Director simply posed a counter-question: “Why does it matter to you?” The CFPB is removed from many of the important checks on agency authority in a way that the FTC never was.

The new majority responds by saying that “the CFPB’s independent funding source has no constitutionally salient effect on the President’s power.” Because they see this as purely a case about whether the President’s removal power has been infringed upon, it makes little sense to them to look at funding. The same logic applies to the fact that the CFPB has one director. If this fact doesn’t interfere with the president’s ability to oversee the agency, then it isn’t relevant. Therefore, the majority sees no reason to allow agencies’ structures to necessarily dictate their constitutionality.

In my opinion, the case turns on who can make a more convincing argument about whether the CFPB is sufficiently distinct from the FTC at issue in Humphrey’s Executor. I think the dissent gets the better of this argument, in large part because the Supreme Court’s jurisprudence in this area is chock full of distinctions. The most notable example is a case called Free Enterprise Fund, which invalidated an agency whose board had two levels of insulation (rather than one) from the president. The Supreme Court held that because of that difference in the way the agencies were structured, Humphrey’s Executor did not apply.

To be clear, I don’t think that Humphrey’s Executor’s applicability should turn on only the fact that the CFPB has one director, while the FTC has a multi-member board. The courts must take into account other factors, such as the level of congressional oversight. After all, many different factors contribute to an agency’s authority. We shouldn’t view each factor in isolation.

Next post, I’ll explain why a similar case out of the Fifth Circuit has perhaps even broader implications.

Monday, January 7, 2018

Will Foster is a high school junior from Chicago, Illinois. Today he’s guest blogging for High School SCOTUS about the Texas court ruling that struck down the Affordable Care Act’s individual mandate. Feel free to check out his SSRN page, where he has also written an article on Janus v. AFSCME. 

The Phantom Mandate: Sebelius’ Tax Holding & The Texas Ruling on Obamacare

By Will Foster

On December 14, 2018, a federal district judge in Texas ruled that a 2017 amendment to the Affordable Care Act had rendered the law’s “individual mandate” unconstitutional. The judge, Reed O’Connor, also declared the remainder of the law inseverable from the challenged provision and thus held the entire statute invalid. Much of the controversy around the decision has focused on its severability ruling, which closely tracks views expressed by the four dissenting Supreme Court justices in NFIB v. Sebelius (2012), a landmark case that upheld the mandate.

However, I am not convinced that Judge O’Connor should have reached the severability question. In my view, his Texas v. U.S. opinion misreads the majority opinion in Sebelius and therefore reaches an incorrect conclusion about the validity of the individual mandate. This provision (26 U.S.C. §5000A(a)) states that non-exempted Americans “shall” procure “minimum essential” health insurance coverage. If they fail to do so, §5000A(b) says they must pay a “penalty,” denominated a “shared responsibility payment.”

The individual mandate reads most naturally (some would argue exclusively) as a requirement to obtain insurance; that’s why it’s usually referred to as a “mandate.” In Sebelius, however, Chief Justice John Roberts and his four conservative colleagues found that such a requirement was not authorized by the Commerce Clause or the Necessary and Proper Clause. In order to avoid striking down the provision, Roberts employed a “saving construction” that interpreted §5000A as merely imposing a tax authorized by Congress’ power to lay and collect taxes. He was joined by the court’s four liberal members to create a five-justice majority for that portion of his opinion — although only Roberts viewed the tax holding as requiring a “saving construction,” since the four liberals believed the Commerce and Necessary and Proper clauses should have been sufficient to uphold the mandate as a true requirement.

It is easy to misunderstand what exactly the five-justice majority ruled in Sebelius regarding the individual mandate. It did not rule that a requirement to obtain insurance was authorized by the taxing power. Instead, it ruled that §5000A(a)’s “individual mandate” did not technically mandate anything at all, but rather merely stated the condition that would trigger the “penalty” in §5000A(b), which the court characterized as a tax. The court then found that §5000A, when interpreted as offering a choice between two lawful options (getting insurance or paying a tax), represented a permissible exercise of the taxing power.

As the court explained, “While the individual mandate clearly aims to induce the purchase of health insurance, it need not be read to declare that failing to do so is unlawful … The Government agrees with that reading, confirming that if someone chooses to pay rather than obtain health insurance, they have fully complied with the law” (Sebelius, p. 37). Indeed, “Those subject to the individual mandate may lawfully forgo health insurance and pay higher taxes, or buy health insurance and pay lower taxes” (p. 44, n. 11). The court’s characterization of §5000A as merely imposing a tax on not having insurance was particularly notable in light of the fact that some legal scholars had tried to persuade the court to uphold the minimum coverage provision as a requirement using the taxing power. The distinction between that position and the one the court actually adopted is subtle but important. Professor Randy Barnett, a leader in the original legal challenge to Obamacare who co-authored the private challengers’ Supreme Court brief, noted the difference just days after the Supreme Court’s ruling came down.

Now, as promised, I’ll turn to the implications of Sebelius for the recent Texas district court decision. As Judge O’Connor explained, “The shared-responsibility payment, 26 U.S.C. §5000A(b), is distinct from the Individual Mandate, id. §5000A(a) … [T]he Plaintiffs challenge only the Individual Mandate, not the shared-responsibility penalty, as unconstitutional” (Texas, p. 20). In late 2017, long after Sebelius, the Tax Cuts and Jobs Act was signed into law. The statute, as relevant here, amended §5000A by reducing the shared responsibility payment to zero, effective January 1, 2019 (statute, p. 39). The language about the payment was not completely excised from the Affordable Care Act; to the contrary, the 2017 Congress essentially only replaced existing income percentages and dollar amounts with “zero percent” and “$0,” leaving the statute looking largely the same as before. But while the change was facially minor, it had major significance. In light of Sebelius’s holding that §5000A provided a choice between either getting insurance or paying a tax, the new edits meant that someone could now both fail to procure insurance and not pay any tax penalty. There was no requirement, and no tax either. In other words, §5000A was entirely toothless.

Or was it? Some alleged that the newfound lack of a tax in §5000A meant that the individual mandate, §5000A(a), could no longer be read as a mere predicate to tax consequences. Instead, these challengers asserted, it now had to be understood as a requirement (which, despite lacking any penalties for noncompliance, would seemingly still be legally binding on Americans). There was no longer any way to avoid construing the mandate in this way. Therefore, the taxing power defense employed in Sebelius was useless. And because Sebelius had made clear that a requirement to obtain insurance was unconstitutional, §5000A(a) was unconstitutional. This was the argument that Judge O’Connor used to strike down the individual mandate a few weeks ago.

Judge O’Connor’s reasoning leads to some strikingly counterintuitive results. It seems to me that if Congress had the power to impose an exaction of $695 or more for uninsured adults using the pre-amendment §5000A (as the Supreme Court held), then Congress should have the power to impose an exaction of any lesser amount — even $0. An argument to the contrary would be rather like saying, “The Constitution gives Congress the power to impose a 10-year prison sentence for x crime, but not the power to impose no prison sentence at all.” That seems like a perverse outcome.

There is another logical oddity in the challengers’ position. Under their theory, the penalty could be set extremely close to zero so long as it stayed non-zero, raising the possibility that the difference of even a single cent could invalidate a provision of the Affordable Care Act (and, if the challengers’ severability analysis controls, the entire law). If Congress set the penalty at one cent, but then changed it to zero cents, would the one-cent difference really have created unconstitutionality where none existed before? Perhaps, I suppose, but it’s certainly an interesting question to ask.

Of course, wholly apart from the merits inquiry, it’s far from clear that the plaintiffs had standing to challenge the mandate in the first place. Judge O’Connor acknowledged that the individual plaintiffs would face no practical consequences were they to stop maintaining minimum essential coverage, but nonetheless found standing because the individuals (being law-abiding citizens) felt they were bound by federal law to maintain such insurance (Texas, pp. 17-18). Therefore, plaintiffs were injured because they had been purchasing insurance they did not want in order to fulfill their legal obligations. And this injury could of course be redressed by invalidation of the individual mandate, which the plaintiffs contended was unconstitutional. There’s a problem with this reasoning, though: As a formal matter, people aren’t legally bound to follow unconstitutional laws. As the Supreme Court put it in Norton v. Shelby County (1886): “An unconstitutional act is not a law; it confers no rights; it imposes no duties; it affords no protection; it creates no office; it is in legal contemplation as inoperative as though it had never been passed” (emphasis added). The court has since qualified this statement, noting that as a practical matter an unconstitutional statute might have engendered reliance interests (before being struck down) that cannot be overlooked. Nevertheless, the basic point still rings intuitively true: American citizens do not have a fundamental obligation to follow unconstitutional “laws.”

Of course, as a practical matter, unconstitutional laws may still cause injury because the government will often keep enforcing these laws until a court makes it stop. But the individual mandate is not currently being enforced: The “penalty” is now $0 and the law does not provide for any other consequences. So the plaintiffs have no standing because, assuming they are correct that the mandate is unconstitutional, they lack any sufficient injury: They are both not legally bound by the mandate and not likely to suffer any practical consequences if they disregard it. Judge O’Connor might respond that I am confusing the merits stage with the standing inquiry by already deciding that the mandate is not a requirement. But by deciding plaintiffs are not bound by the mandate I do not necessarily decide (yet) that the mandate isn’t a requirement; I merely note that, even if it is a requirement, it is unconstitutional and therefore of no force.

The traditional approach to standing, as I understand it, is to assume for the sake of argument that the plaintiffs succeed on the merits. So here we should assume that the mandate is an unconstitutional requirement (as the plaintiffs urge) and then realize that the plaintiffs have no standing because an unconstitutional requirement demands no obedience. Indeed, plaintiffs “cannot manufacture standing merely by inflicting harm on themselves.” Whether the asserted injury is in fact self-inflicted is crucial to establishing whether standing exists. For the reasons stated above, if the statute is unconstitutional then the harm seems to be self-inflicted because plaintiffs’ sole claimed reason for why they continue to maintain minimum essential coverage — that the law compels them to — would not exist. I think this argument seems quite compelling. And there are other related arguments against standing for the individual plaintiffs.

In any event, let’s go back to the merits. In his attempt to justify his position, Judge O’Connor approvingly offered arguments propounded by the dissent in Sebelius and rejected — explicitly or implicitly — by the majority. For example, Judge O’Connor explained that the individual mandate must be a requirement because it uses the word “shall” (Texas, p. 31). This argument was considered and rejected by the Sebelius majority when it decided to construe the mandate as merely a condition that triggered a tax (Sebelius, p. 38). Judge O’Connor also approvingly cited the joint dissenters’ argument that the individual mandate must be a requirement due to the separate set of exemptions the Affordable Care Act provides for the mandate itself as opposed to the penalty (Texas, p. 33). Arguments like this would have been perfectly reasonable before 2012, but in light of Sebelius’s ruling that the mandate is not a requirement, I can’t agree that such arguments are still tenable.

You might be wondering how some distinguished legal scholars arrived at the contrary conclusion. In large part the disagreement seems to be due to the different ways we interpret Sebelius. For instance, Professor Josh Blackman, the author of “Unprecedented,” has defended Judge O’Connor’s ruling on the mandate. Professor Blackman suggests that in 2012 Roberts actually “rejected” the argument that §5000A provided a choice between two equally lawful options: “Roberts … observed that ‘[t]he most straightforward reading of the mandate is that it commands individuals to purchase insurance. After all, it states that individuals “shall” maintain health insurance.’ In other words, no such choice exists.”

Respectfully, I read Roberts’ opinion differently. It seems to me that in describing the “most straightforward” way to read the mandate, the Chief Justice was merely noting that common interpretation before rejecting it as, in essence, legally incorrect, since in his view it would render the provision unconstitutional. Professor Blackman allows that Roberts “was willing to accept [the tax] argument for purposes of the saving construction,” but I would go further and say that Roberts appeared to believe the tax/lawful choice interpretation was the correct and ultimately authoritative construction of the statute. Indeed, as noted above, Roberts and his four liberal colleagues stated explicitly in the majority opinion that “[t]hose subject to the individual mandate may lawfully forgo health insurance and pay higher taxes, or buy health insurance and pay lower taxes” (Sebelius, p. 44, n. 11). That sentence and its surroundings contain no qualifications on that statement; the declaration is categorical and clear. Even more evidence may be found in this statement by the majority: “That Congress apparently regards such extensive failure to comply with the mandate as tolerable suggests that Congress did not think it was creating four million outlaws. It suggests instead that the shared responsibility payment merely imposes a tax citizens may lawfully choose to pay in lieu of buying health insurance” (p. 38).

Let’s get one thing straight: Whether a reading of a text is “fairly possible” does not really depend at all on congressional powers. Considerations of constitutionality only kick in to decide which fairly possible reading to adopt (if there are multiple such readings). Specifically, if there exist one or more fairly possible readings that would make a provision valid, judges are obliged to adopt one of those constructions rather than any other fairly possible constructions that would render the provision invalid.

Now let’s carefully go back through Sebelius. Chief Justice Roberts found that there were two fairly possible readings of §5000A. He felt that one of these — reading the section as imposing a requirement backed by a penalty — was the most natural interpretation of the plain text, and other things being equal he would have preferred to adopt this reading. He concluded, though, that this construction would force him to declare the section unconstitutional. That’s why he turned to the second interpretation he saw as fairly possible: §5000A did not declare failure to have insurance unlawful, but offered a choice between two lawful options. At the time Roberts confronted the issue, these two lawful options were either getting insurance or paying a specified amount of money. Of course, after the elimination of the penalty, the two lawful options are either getting insurance or not doing anything.

Roberts focused on the taxing power in Sebelius because an exaction of a non-zero dollar amount requires an enumerated congressional power (here, the taxing power) to support it, and at the time Congress made those without insurance pay money. But “making” people do nothing — which is now how Congress “penalizes” those who don’t get insurance — requires no constitutional power at all. Neil Siegel recently explained this, in a blog post amusingly titled “Congress’s Inherent Power to Require No One to Do Anything”: “To put it bluntly, Congress does not require an enumerated power to declare that Americans must either do X or else not do X and suffer no consequences. After the 2017 statutory amendment to the ACA, that is what the individual mandate and shared responsibility payment provisions provide.”

The fact that §5000A arguably no longer contains a valid exercise of the taxing power (because it might no longer raise any revenue) does not suddenly make Sebelius’s basic construction of the section inapplicable. Even if the precise circumstances Sebelius faced no longer exist, it does not follow that the proper analysis somehow defaults back to a de novo look at the text’s most natural meaning, which virtually everyone has always agreed is as a requirement-with-penalty. In a December 30 order staying his judgement while appeals proceed, Judge O’Connor doubled down on his initial reasoning. He suggested that an argument like mine “is premised on the view that the Supreme Court’s reasoning in NFIB did not simply craft a saving construction but instead permanently supplanted Congress’s intent by altering the very nature of the ACA” (p. 7). That is essentially what I’m arguing, although for what it’s worth the Supreme Court certainly did not appear to see its reasoning as “supplant[ing] Congress’s intent.” Consider this statement I noted above: “That Congress apparently regards such extensive failure to comply with the mandate as tolerable suggests that Congress did not think it was creating four million outlaws. It suggests instead that the shared responsibility payment merely imposes a tax citizens may lawfully choose to pay in lieu of buying health insurance” (Sebelius, p. 38).

Also, part of the reason I’m hesitant to dismiss the Sebelius tax argument as just an ephemeral “saving construction” is that the four liberal justices who joined Roberts didn’t believe it was a saving construction, but apparently saw it as just an equally valid alternative way of deciding the case. They did not join Parts III–B or III–D of Roberts’ opinion, which explained why a “saving construction” was necessary in order to avoid having to declare the statute unconstitutional. Justice Ginsburg, joined by her three liberal colleagues, wrote, “I agree with the Chief Justice that … the minimum coverage provision is a proper exercise of Congress’ taxing power … Unlike the Chief Justice, however, I would hold, alternatively, that the Commerce Clause authorizes Congress to enact the minimum coverage provision” (Sebelius, pp. 1-2). And she chided Roberts for, in her view, unnecessarily resolving the Commerce Clause question: “The Chief Justice ultimately concludes, however, that interpreting the provision as a tax is a ‘fairly possible’ construction. That being so, I see no reason to undertake a Commerce Clause analysis that is not outcome determinative” (p. 37, n. 12).

Ultimately, the 2017 amendment to the individual mandate didn’t change the basic structure the Supreme Court found in Sebelius, which was a fully authoritative construction of the statute: The law provides a choice between two lawful options. And, unlike in Sebelius, the plaintiffs in Texas challenged only the mandate — §5000A(a) — and not the penalty (Texas, p. 27). Thus, under Sebelius, the plaintiffs in Texas were really just challenging one of two options, not a requirement. But as I explained above, Congress plainly does not require any enumerated power to pass such an “option.” (Marty Lederman cogently made this argument a couple weeks ago.) At a fundamental level, the construction the Sebelius majority imposed on §5000A did not depend on whether the interpretation involved a tax. The majority may have chosen to adopt that reading because it had a tax (and thereby provided a way to maintain the penalty but avoid having to strike down the provision), but the interpretation itself — of a non-mandatory “shall” and a choice between two lawful options — would have been fairly possible regardless. Thus, this basic construction is still valid even if there is no longer any tax. It may not be the interpretation some wanted, but it’s the one the Supreme Court adopted. And it still has the benefit of avoiding unconstitutionality (ut res magis valeat quam pereat) since, as I’ve explained, it would today sustain §5000A. Judge O’Connor’s reading invalidates the provision.

True, my interpretation would mean the individual mandate provision would currently be without any effect, thereby infringing upon the canon against surplusage. Nevertheless, that canon yields readily to context, and in this case it is not hard to imagine why Congress could have wanted to substantively gut the provision with the 2017 amendment. The 115th Congress boasted Republican majorities in both the House and the Senate, and Republicans had made opposition to the Affordable Care Act a rallying cry throughout the decade.

Suggestions that Congress in 2017 consciously intended to get the individual mandate struck down by pulling the floor out from under the saving construction are implausible. Nobody seems to have mentioned any such plan at the time, and I think it’s more likely that the Republican members of Congress simply reasoned, “We know the Supreme Court has ruled that there is no requirement — only a tax — so when we eliminate the tax there will be essentially nothing left of §5000A.” In any event, there is a simple explanation for why Congress left the individual mandate itself intact despite removing the penalty: Due to procedural rules, Congress couldn’t use the Tax Cuts and Jobs Act to repeal the mandate – that would have required a filibuster-proof majority in the Senate, which Republicans didn’t have. All it could do in that act was reduce the associated tax penalty (Texas op., p. 11).

I have tried really, really hard to understand the intricate case made by the law’s challengers and Judge O’Connor. At the end of the day, though, I think that the challengers’ reasoning has too many holes. At least for the time being, I cannot subscribe to their argument. §5000A(a) may be known as the “individual mandate,” but it’s not really a mandate. It’s a mere phantom of one.

Sunday, January 6, 2018

by Anna Salvatore

The Supreme Court agreed to hear six cases on Friday. Two of them deal with partisan gerrymandering, one concerns whether the definition of “crime of violence”  is unconstitutionally vague in a federal law, another is a securities case, and then there’s Iancu v. Brunetti, a First Amendment challenge to the government’s ban on registering “scandalous” and “immoral” trademarks.

The brief in Iancu differs from the average Supreme Court brief in that it spends a page listing vulgar registered trademarks, including “SATAN’S PISS,” “PINK TACO,” and “WTF IS UP WITH MY LOVE LIFE?” But there are also serious legal arguments worth exploring. For example, Brunetti argues that the government is practicing viewpoint discrimination by accepting some scandalous trademarks and not others. Officials are “selectively approving or refusing profanity, excretory, and sexual content based upon the level of perceived offensiveness,” he wrote, as they tend to favor smiley face marks over middle fingers, polite humor over raunchy humor, and even pro-capitalism marks over anti-capitalism marks. He disagrees with the government on this point, since Solicitor General Noel Francisco claims that the Scandalous Clause is content-neutral.

To be clear, laws are almost never allowed to regulate speech based on its content. Laws that regulate based on content must survive strict scrutiny review, which requires the government to “prove that the restriction furthers a compelling interest and is narrowly tailored to achieve that interest.” (Reed v. Town of Gilbert) Like Ronald Torreyes, the Yankees utility man who can play all over the infield, strict scrutiny is somewhat flexible. It applies when a government law bans protected speech and when the law only burdens protected speech.

In 2017, the Supreme Court decided a case similar to Iancu called Matal v. Tam.  There it held that the Patent Trade Office can’t deny trademark applications based on certain marks’ “disparaging” nature. The funky thing is that the Court couldn’t agree on how much scrutiny the Disparagement Clause deserved. Justice Alito opted out of the debate in his majority opinion, writing that it was unnecessary to apply strict scrutiny, intermediate scrutiny, or Justice Kennedy’s contrived “heightened scrutiny” if an even less stringent standard called Central Hudson would do. Yet certain parts of his opinion garnered four votes, not five, which leaves some doubt about whether his scrutiny analysis is binding law.

Parsing meaning from a fragmented opinion is difficult. If four justices vote for one level of scrutiny and four justices vote for another, which side controls? Marks v. United States (1977) tells us that the narrower interpretation is the holding, but as UCLA law professor Richard Re explains, “extracting precedent from fractured decisions can be like squeezing water from stone.”

Brunetti is trying to wring every last drop from the stone, but it’s not yielding any water.  You see, he thinks that the same level of scrutiny used in Tam, which dealt with the Disparagement Clause of the Lanham Act, should also be imposed on the Scandalous Clause. He’s just having a hard time understanding which level of scrutiny was used in Tam. “Does Justice Thomas’ concurrence, together with the four justices joining Justice Kennedy’s opinion, make five for scrutiny greater than intermediate scrutiny?” asked Brunetti. “Or instead, do we look at the justices’ reasoning (i.e., in a Venn diagram, the circles of the justices’ reasoning do not overlap). If the latter, was the level of scrutiny decided by an evenly divided court and therefore, without precedential effect, at least as to that issue?” In his brief, he asks the Court to provide an unambiguous bright line rule for applying the Marks rule.

Brunetti also tells the Court that the Scandalous Clause is unconstitutionally vague. He says the clause is too vague for two reasons: it doesn’t give fair notice about which marks are banned, and the Patent Trade Office applies it so inconsistently that the instructions must be unclear. However, the goverment’s reply brief in Tam counters that the vagueness standard is less strict when the law at issue doesn’t ban or punish speech. It says that the standard is relaxed if laws “simply [confer] benefits on speakers whose expression satisfies certain criteria,” like the PTO confers trademarks on applicants. After all, the PTO can’t punish you for proposing a vulgar trademark. It can only say, “Nah, we can’t accept this trademark. Sorry.”

If you’d like to learn more about the case, here are the hyperlinks for Brunetti’s writ of certiorari, the lower court opinion in Iancu, the Supreme Court’s opinion in Tam, and Richard Re’s tremendous paper called “Beyond the Marks Rule.” 

Thanks for reading.


Thursday, January 3, 2019

The Supreme Court’s Takings Clause Jurisprudence: A Comedy of Errors

by Curtis Herbert

Although the Supreme Court gets a great many things right, certain areas of the Constitution have been neglected or wrongfully changed. One such area is the Takings Clause. Over the course of several decades, the Supreme Court has effectively rewritten the clause, radically altering both its scope and the protections that it offers.

The necessary background doesn’t begin with Kelo v. New London, or even the precedents Justice Stevens cites in his majority opinion. It begins with the basic concepts of property law. Ownership of property gives the owner a whole host of rights. She does not merely have the right to exclude; otherwise she could not enter her own land. She also has the right to construct buildings and to use her land for grazing, farming, or simply to let it sit. Title to land also necessarily includes the ability to dispose of it as she chooses: to sell it, give it away, or bequeath it in a will. These rights stop, however, when there is material damage to someone else, as when a property owner constructs a building that produces soot which covers her neighbor’s house, which is a tort. It’s your land, and you can do what you want with it so long as you don’t harm anyone else. It is this concept of property that is protected in the Takings Clause, not one reduced to merely the right to exclude or the right to sell property.

But the Court’s errors breeze over such paltry barriers as enumerated rights. In the 1978 case of Penn Central Transportation Co. v. New York City, a majority of the Court held that, if New York so chose, it could prohibit the construction of a 55-story office building above a train station. This decision was made through a landmark preservation law, which forced owners of “landmark sites” (as designated by a committee) to seek permission before altering their sites. When Penn Central entered into a lease with another company to construct office buildings above the station, the Landmarks Preservation Committee intervened. In response, Penn Central claimed a violation of the Takings Clause and sought just compensation. The Supreme Court found no violation. It held that the city could block development of the air above the station with no regard to the several million dollars this would cost Penn Central. In doing so, it erred through several crucial misreadings of the Takings Clause.

First, Justice Brennan’s attempt to equate the committee’s decision with zoning laws is simply wrong. He misses the point entirely. Because owning property does not include a right to harm others or increase the risk of disease or fire, laws which protect neighbors and passerby from harm do not infringe on an existing property right. Now, zoning laws are (at least ostensibly) motivated by a desire to regulate for safety or the public welfare. But in Penn Central, no one alleged that the proposed building would be unsafe — only that it would be ugly. The committee that prohibited the building didn’t seek to protect any of the interests that provide reason for zoning laws. But it did remove Penn Central’s ability to make decisions which are inherent, inextricable, and central to the idea of property ownership, absent any pretense save for ‘we don’t like it.’

Second, Justice Brennan performs an act of linguistic gymnastics worthy of Chief Justice Marshall. He states that “the law does not interfere with what must be regarded as Penn Central’s primary expectation concerning the use of the parcel. More importantly, on this record, we must regard the New York City law as permitting Penn Central not only to profit from the Terminal but also to obtain a ‘reasonable return’ on its investment.”

As it turns out, when you remove the words “taking” and “just compensation” from the Constitution and replace them with words such as “primary expectation” and “reasonable return,” the results you get are very different. The plain text requires that if a taking (a deprivation of property rights) has occurred, then just compensation (the market value of the rights being interfered with) must be paid. The newer, more hip version Justice Brennan creates asks not whether there was a taking, but whether the “primary expectation” that guided purchase of the land was interfered with, or whether the owner of the property could obtain a “reasonable return” on her investment in the property. This is nothing less than a radical alteration of the Takings Clause, one that even Justice Stevens (who would later write the majority opinion in Kelo, as well as in Babbit v. Sweet Home) dissented from.

The Kelo opinion contains a similarly fanciful reading of the Takings Clause. Susan Kelo was the owner of a small pink house that the government bulldozed to make space for a new research facility. In his majority opinion, Justice Stevens does what Justice Brennan did in Penn Central: delete a phrase and add his own. (To be fair to Justice Stevens, he was faithfully interpreting a couple of abhorrent precedents. While I would rather have seen the precedents overturned, this makes his opinion much less absurd than Brennan’s.)

In any event, the phrase Justice Stevens reads out is the requirement that property be taken “for public use.” Nobody denies that the bulldozing of Susan Kelo’s property, if it was indeed constitutional, constituted a taking. Accordingly, she was paid just compensation. The issue before the Court concerned whether or not the taking was constitutional in the first place. Susan Kelo and her lawyers proclaimed that since the taking was not for “public use,” it was unconstitutional even if compensation was paid. Justice Steven then proceeded to don his Brennan hat, and he equated public use with public benefit, or public purpose. What, then, are the public purposes that the city of New London used to sustain their actions? In a case called Midkiff, a willfully oblivious and shameless Court held that “the State’s purpose of eliminating the social and economic evils of a land oligopoly” qualified as public use. Here, Justice Stevens followed their tawdry example, holding that making room for a research building in order to revitalize the economy is a public use. The Court, naturally, will be extremely deferential to governments when they decide what is an economic benefit, ripping out the heart of the phrase “public use.”

The end result is that Kelo v. City of New London did to “public use” what Wickard v. Fillburn did to “commerce among the several states.” It took a phrase which imposed real limitations on federal power and interpreted it in such a nebulous way as to render it entirely devoid of its original meaning. When Wickard is combined with Penn Central, the ability of the government to seize private property is increased in a way that is inconsistent with the Takings Clause. The Supreme Court ought to take a hard second look at this area of constitutional law.