This is also known as King v. Burwell. Ronald D. Rotunda at the Verdict Blog summarizes the case:
Plaintiffs argue that the Affordable Care Act (“ACA”) does not allow the federal government to subsidize federal health exchanges, only state-created health exchanges. The law itself is complex, totaling nearly a thousand pages in length. However, the statutory interpretation issue is straightforward.
William Baude suggests in the New York times that a decision adverse to supporters of the ACA should simply be ignored except in the most narrow of circumstances:
But luckily the Constitution supplies a contingency plan, even if the administration doesn’t know it yet: If the administration loses in King, it can announce that it is complying with the Supreme Court’s judgment — but only with respect to the four plaintiffs who brought the suit.
This announcement would not defy a Supreme Court order, since the court has the formal power to order a remedy only for the four people actually before it. The administration would simply be refusing to extend the Supreme Court’s reasoning to the millions of people who, like the plaintiffs, may be eligible for tax credits but, unlike the plaintiffs, did not sue.
What?
To be sure, the government almost always agrees to extend Supreme Court decisions to all similarly situated people. In most cases, it would be pointless to try to limit a decision to the parties to the lawsuit. Each new person who was denied the benefit of the ruling could bring his own lawsuit, and the courts would simply rule the same way. Trying to limit the decision to the parties to the suit would just delay the inevitable.
That feels like minutiae.
But the King litigation is different, because almost everybody who is eligible for the tax credits is more than happy to get them. Most people who receive tax credits will never sue to challenge them. Lawsuits can be brought only by those with a personal stake, so in most cases the tax credits will never come before a court. The administration is therefore free to follow its own honest judgment about what the law requires.
This idea may seem radical, but it has a strong legal pedigree. Judicial authority, or jurisdiction, is case-specific and person-specific. That is true even of the Supreme Court, which the Constitution gives “judicial power” to decide “cases” and “controversies.” It is reaffirmed by Marbury v. Madison (1803), which affirmed the power of judicial review by relying on the Supreme Court’s duty to decide “particular cases.”
Rotunda disagrees:
Let us say that the Obama Administration follows this law professor’s advice if it loses before the Supreme Court. IRS officials will give out tax subsidies contrary to the law. Those officials will violate the Federal Anti-Deficiency Act, 31 U.S.C. § 1341, et seq., which prohibits them from passing out federal money without statutory authorization. The helpful employees who pay out these subsidies go to prison, and the government collects from the recipient three times the federal money received. There is no need for the prosecution to prove any specific intent to defraud.
That is not the end of the story. What happens if the Administration does not enforce the Anti-Deficiency Act? Congress thought of that, too. Any taxpayer can sue the officials and force them return the money, out of their own pockets, by filing a qui tam action under the False Claims Act, 31 U.S.C. § 3729 et seq. The taxpayer has an incentive to sue because he or she collects from 15 percent to 30 percent of the proceeds.
There is another problem. If the Administration can ignore an adverse decision in King v. Burwell (and apply the rule only to the four individuals who are plaintiffs), future governments can do likewise. For example, let us say the Supreme Court rules that there is a constitutional right to gay marriage. Under the proposal of the law professor, states can apply that decision only to the particular gay couples suing in that particular case. My Verdict co-columnist Michael Dorf discusses that point on his blog.
So, if the Administration takes this advice, it will find that its officials will go bankrupt repaying the money out of their pockets. My advice: follow the law, not the law professor.
This exchange was a trifle startling: I’d never heard of fining officials for misconduct (usually it seems like they’re immune and just get a hand slap), and this assertion that a case applies only to the parties … well, OK, now that I think about it, it does make sense. But why bring it up when it’s clear the government is party to the suit?
I have not found a rebuttal from Mr. Baude.
