The state of Virginia lacks the standing to sue against the Obama administration's 2010 health reform law, an Appeals Court in Richmond ruled unanimously on Thursday.
“Virginia, the sole plaintiff here, lacks standing to bring this action. Accordingly, we vacate the judgment of the district court and remand with instructions to dismiss the case for lack of subject-matter jurisdiction,” the 4th Circuit wrote in its decision, the second major ruling to uphold the law.
The cases are widely expected to go to the Supreme Court.
Most of the cases against the law challenge its requirement that just about everyone have health insurance or pay into a fund—referred to as the "individual mandate."
The 6th Circuit Court of Appeals in Ohio upheld the requirement in June. But last month, the 11th Circuit Court in Atlanta ruled in favor of 26 states that challenged the mandate as unconstitutional.
The 4th Circuit didn’t ponder the question of the mandate, but said Virginia, as a state, cannot sue. The ruling notes that Virginia claimed the federal law conflicts with its own Virginia Health Care Freedom Act. “Virginia filed this action on March 23, 2010, the same day that the President signed the Affordable Care Act into law. The Governor of Virginia did not sign the VHFCA into law until the next day,” Circuit Judge Diana Gribbon Motz wrote in the opinion.
But Motz offered critics of the 2010 health care law a way forward, suggeting the "importance of waiting for an appropriate case to reach the merits. This is not such a case.”
The meat of the ruling comes in the three-judge panel’s 140-page opinion on the challenge brought by Liberty University, a Christian college based in Lynchburg, Va. Two of the three judges dismissed Liberty’s standing to challenge the health care law, arguing that people cannot sue over federal taxes until they actually take effect.
Because the insurance-coverage requirement, which requires people to pay more taxes if they don’t have health insurance, does not take effect until 2014, Motz and Judge James Wynn said the college did not have standing.
In individual opinions, Wynn and Judge Andre Davis say outright that they would uphold the insurance requirement as constitutional, if the court had been able to rule on the merits of the health care law.
“I would uphold the constitutionality of the Affordable Care Act on the basis that Congress had the authority to enact the individual and employer mandates, which operate as taxes, under its taxing power,” wrote Wynn.
Davis, who disagreed that Liberty University did not have a standing to challenge the health care law, still said the insurance coverage requirements “pass muster as legitimate exercises” of Congress’s authority.
Karen Harned, executive director of the National Federation of Independent Business Small Business Legal Center, said the ruling was no surprise. "It was obvious to all who heard the 4th Circuit oral argument that the plaintiffs faced an uphill battle," Harned said in a statement.
“However, NFIB is encouraged by our recent victory in the 11th Circuit, which found the individual mandate to be a gross overreach of the Congress’ commerce powers. Given the resulting split decisions among appeals courts, it is now time for the Obama Administration to seek immediate review by the U.S. Supreme Court. The health care law is already imposing unsustainable costs on the states and businesses."