The Court denied a motion to dismiss. The opinion is here. Procedurally, this is significant as it moves the case forward for a full review. Is it predictive of anything? After reading the decision several times, these are my thoughts:
Particularly interesting are the Court’s comments that the penalty is beyond the outer limits of the commerce clause so far. At page 25, the Court states “Never before has the Commerce Clause and associated Necessary and Proper Clause been extended this far.” The Court makes at least one very similar statement elsewhere.
That is rather strong. Many commentators, including Constitutional Law Professors, have argued the case is a simple one . . . that the penalty easily fits within traditional Commerce Clause jurisprudence. Clearly this Court disagrees with that notion – that the analysis is simple or that the penalty is consistent with existing cases. I do not want to read too much into this. By itself, it tells me nothing about whether the Judge might decide to extend the reaches of the Commerce Clause; however, I believe District Courts are generally hesitant to extend important Constitutional provisions, particularly in cases likely to be appealed. Traditionally, Courts take a more restrained approach, leaving extensions, if any, to the Supreme Court. Thus, this part of the case is predictive, albeit modestly so.
I continue to applaud the Anti-injunction analysis – particularly the ruling to the effect a State is not a “person.” That is very important for the Florida case, in my opinion. Similarly, the ripeness issue is substantial. The Court clearly recognized the case is purely a matter of law and involves no substantial disputed facts; hence, it will not get any riper. That, too, strikes me as very important. I expect the other District Courts will pay close attention to that.
I was disappointed in the Taxing Power portion of the decision; however, I do not criticize the Court for that. I suspect the issues were not fully briefed. I have not seen the briefs in this case, so I am speculating. As I have said elsewhere, the heart of the tax issue involves whether the penalty – if a tax – is an excise tax (subject to uniformity), an income tax (subject to the 16th Amendment realization requirement), or a Direct Tax (subject to apportionment). I view the “General Welfare” issue in relation to the taxing power as unimportant. Uniformity and Apportionment are the real issues. At Part V. on page 25, the Court described the Taxing Power issue as “even closer” than the Commerce Clause issue. To the extent the Court focuses on the “general welfare” limitation and on the authority of Congress to “regulate” through a tax, I agree. However, I do not see the uniformity, realization, or apportionment issues to be close at all. If this is a tax, it fails. I suspect, the heart of the Taxing Power issues were not argued; hence, the Court did not discuss them except in passing. I suspect future opinions will address the Taxing Power in more depth, as the litigants begin to argue the point more.