BREAKING: Fourth Circuit Calls Individual Mandate a Tax


By Hadley Heath

Crossposted at

This comes as no surprise, but at least it's settled: The Fourth Circuit Court of Appeals dismissed both Virginia v. Sebelius and Liberty v. Geithner today, ruling that the challengers of ObamaCare did not have standing.  After the panel requested supplemental briefs on the Anti-Injunction Act mid-summer, they raised suspicion that they would deem the individual mandate a tax.  This is tricky of them, you see, as the Anti-Injunction Act does not allow plaintiffs to sue over unconstitutional taxes until the taxes are collected (and the penalty fines for the individual mandate will not be collected until 2014).

No other court (even the liberal ones!) has ruled that the individual mandate is a tax.  The most recent appellate court to rule on ObamaCare offered an in-depth explanation of why the individual mandate must be considered an economic mandate (and not a tax!).  Read more about that here.

While today's news is somewhat disappointing, it's not a surprise at all.  Two of the three judges selected in the Fourth Circuit panel were appointed to the bench by President Obama himelf.  If there is a silver lining to this cloud, however, it is that at least now we have an answer from the feet-dragging Fourth Circuit.  Virginia and Liberty-U were stalled out in Appeals-land for too long, waiting more than a month longer than the plaintiff-appellees in the Florida case to get their rulings.  The dismissal of the Liberty case and the Virginia case won't have any effect on the other cases, and maybe now we will see one of the multiple ObamaCare challenges move to the Supreme Court.

Americans are tired of the uncertainty that ObamaCare has brought, and want a final answer from the Supreme Court.  We can only hope that today's ruling means more pressure for the High Court to resolve the various issues and opinions surrounding this law's Constitutionality.

Legal scholars are weighing in on today's ruling.  Check out these reactions.

Stephen B. Presser, professor of legal history, Northwestern University:

In a highly technical decision, which did not rule on the Constitutionality of the Act, the United States Court of Appeals for the Fourth Circuit has thrown out a challenge to the constitutionality of the individual mandate of the Patient Protection and Affordable Care Act ("Obamacare").  The Court ruled that since the individual mandate applies only to individuals the state of Virginia, which had brought this particular action, had no "standing," or, in other words, the state could not stand in the shoes of the individual Virginians affected by the Act.  This decision might well be questionable, but the Court did note that important Constitutional issues were involved, and even the Court conceded that those issues should be resolved in an appropriate forum.  This is a further indication that the United States Supreme Court should soon resolve this issue, now that both the District Courts and the Court of Appeals have issued contradictory decisions both on the standing and substantive issues.

Ilya Shapiro, Senior Fellow in Constitutional Studies at the Cato Institute, Editor-in-Chief of the Cato Supreme Court Review:

The Fourth Circuit’s rulings today in no way affect any other case and should only speed up the Supreme Court’s ultimate consideration of the issues raised in all these challenges.  The dismissal of Virginia’s lawsuit on standing grounds merely removes one particular plaintiff from consideration, even as 26 states and numerous non-state plaintiffs remain in separate suits.  Similarly, the dismissal of Liberty University’s lawsuit, while interesting in that it marks the first-ever finding that the individual mandate is a tax (that cannot be challenged before it’s enforced), doesn’t change the jurisprudential calculus because there was already a split between the Sixth and Eleventh Circuits on the mandate’s constitutionality.  All of the constitutional issues attending the individual mandate have now been exhaustively ruled upon by three federal appellate courts in four separate cases.  While the D.C. Circuit will hear argument in yet another suit later this month, there’s no reason for the Supreme Court to delay its review.  As President Obama unveils yet another plan to stimulate job creation, it’s time to finally put an end to the uncertainty over the fate of his most economically damaging piece of legislation.

Ilya Somin, Associate Professor of Law, George Mason University School of Law:

The 4th Circuit dismissed the suit on technical jurisdictional grounds without reaching the main issue: whether the individual mandate is constitutional. The Fourth Circuit's ruling that Virginia lacked standing to bring the case is highly questionable. But even if the Supreme Court endorses that view, there are numerous other plaintiffs, both individuals and state governments, who do have standing. Since two other circuit courts, the Sixth and Eleventh, have already split on the issue of the mandate's constitutionality, the question is clearly ready for consideration by the Supreme Court.


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