Tag: amicus briefs

Supreme Court Must Resolve Obamacare Chaos

When the Affordable Care Act was being debated in Congress, former House Speaker Nancy Pelosi infamously insisted that “we have to pass the bill to find out what’s in it.”  It turns out, however, that the Obama administration—which has been making it up as it goes along with regard to ACA enforcement—doesn’t care “what’s in it.”

The IRS in particular has been implementing Obamacare as it thinks the law should be, not as it is. The ACA encourages states to establish health insurance exchanges by offering people who get their health coverage “through an Exchange established by the State” a tax credit—a subsidy to help them pay their premium. In the event a state declines to establish an exchange, Section 1321 further empowers the Department of Health and Human Services to establish federal exchange in states that decline to establish their own exchanges (without providing for the premium subsidy).

When, contrary to the expectations of the law’s achitects, 34 states declined to establish an exchange—two more have since failed—the IRS decided that those getting their insurance on federally established exchanges should qualify for tax credits regardless of the statutory text. In conflict with the U.S. Court of Appeals for the D.C. Circuit in a similar case called Halbig v. Burwell, the Fourth Circuit in King v. Burwell found the legal text to be ambiguous and thus deferred to the IRS interpretation.

The so-called Chevron doctrine counsels that statutory text controls when Congress has spoken clearly on an issue. But where Congress is ambiguous or silent, the agency can fill the regulatory gap with its own rules and policies. The problem here is that the ACA’s text was not ambiguous and there is no evidence that Congress intended to delegate to the IRS the power to determine whether billions of taxpayer dollars should annually be dispersed to those purchasing health care coverage on federal exchanges. That the Fourth Circuit has bent over backwards to accommodate the administration’s latest Obamacare “fix shows that it, too, is not so concerned with “what’s in” the law. 

To that end, Cato joined four other organizations to support the plaintiffs’ petition for review by the Supreme Court. Our brief argues that the Court should hear the case because it offers the opportunity to reverse potentially grave harm to the separation of powers, to correct a misapplication of the Chevron doctrine, and to restore the idea that drastically altering the operation of a major legislative act belongs to the political process and not in a back rooms of an administrative agency. Just because those who voted for the ACA didn’t care what it said doesn’t mean that the executive and judicial branches should also turn a blind eye.  

To see the legal machinations now at play in these cases regarding the Obamacare-IRS-tax-credit, see my recent op-ed in the National Law Journal. Since that was published this past Monday, the government received a 30-day extension in which it has to file its response to the King cert petition. That means that the Supreme Court will be considering at some point next month whether to take the case.

For Cato’s previous briefs in Halbig and King, respectively, see here and here.

The First Amendment Protects Random Ugly Rap Lyrics

To ensure that public discussion remains “uninhibited, robust, and wide-open,” the First Amendment protects speech that is “vituperative, abusive, and inexact.” While nobody will argue that Anthony Elonis’s speech—the subject of a Supreme Court case this coming term—was anything but “vituperative, abusive, and inexact,” there is considerable disagreement over whether his speech should be protected by the First Amendment. 

Elonis’s chosen form of speech was a series of rap lyrics he posted on Facebook under the pseudonym “Tone Dougie.” Many of the lyrics were violent and lurid, and some of those violent images were made in reference to Elonis’s estranged wife, who took them as a threat to her life. As a result of his crude posts, Elonis was fired, his wife obtained a protective order against him, and he was arrested and charged with violating 18 U.S.C. § 875(c), which makes it a federal crime to transmit in interstate commerce “any communication containing any threat to injure the person of another.”

Elonis argued that his rap lyrics were an artistic expression and that because he did not intend them to be a threat, his speech should be protected. The federal district court hearing his case didn’t see it that way. The judge rejected his request that the jury be instructed to consider his actions based on whether he expressed a subjective intent to threaten and instead instructed the jury to judge his speech based on whether a reasonable person would have interpreted the lyrics as a serious expression of intent to inflict bodily injury. Elonis was thus convicted and the U.S. Court of Appeals for the Third Circuit also rejected his argument that a subjective intent to threaten is required before speech loses First Amendment protection.

Now before the Supreme Court, Cato has joined the American Civil Liberties Union, the Abrams Institute for Freedom of Expression at Yale Law School, the Center for Democracy & Technology, and the National Coalition Against Censorship on a brief supporting Elonis’s position. We argue that Supreme Court precedent shows that (1) a subjective intent to threaten is an essential element of a “true threat,” (2) requiring a finding of subjective intent is in line with First Amendment principles, and (3) drawing the line between threat and protected speech carefully is particularly important given the rise of the Internet as a forum of communication—one where it can be easy to take things out of context.

As a matter of most people’s taste, the Internet may well be better off without violent rap lyrics like Anthony Elonis’s. But that shouldn’t matter to this case or how it’s analyzed under the First Amendment, which requires a high standard of proof regarding incitement or threats of violence before individuals can be jailed for their speech. The Supreme Court should take this opportunity to speak that truth freely across all mediums.

Elonis v. United States will be argued at the Supreme Court in November or December.

This blogpost was co-authored by Cato legal associate Julio Colomba.

Industry Groups Cloaked with State Power Shouldn’t Get Antitrust Immunity

Under a 1943 Supreme Court decision called Parker v. Brown, state governments and private parties who act on state orders are typically immune from prosecution under federal antitrust laws. Thus, while private parties who create cartels face severe penalties, state governments can authorize the same anti-competitive behavior with impunity. 

Still, the Supreme Court has held that this kind of immunity only applies if the private parties who engage in cartel behavior are “actively supervised” by state officials. A case now before the Supreme Court, N.C. State Board of Dental Examiners v.FTC, presents an opportunity to expand on that directive.

Beginning in about 2003, the North Carolina Board of Dental Examiners issued cease-and-desist orders to beauticians and others who were offering “teeth whitening” services (in which a plastic strip treated with peroxide is applied to the teeth in order to make them brighter). Although teeth-whitening is perfectly safe—and can even be done at home with an over-the-counter kit—the state’s licensed dentists want to limit competition in this lucrative area.

The Board is made up entirely of practicing dentists and hygienists and is elected by other licensed dentists and hygienists—with no input from the general public—and evidence later revealed that the Board issued orders on this subject in response to complaints from dentists, not consumers. The Federal Trade Commission charged the Board with engaging in anticompetitive conduct. Although the Board argued that it should enjoy Parker immunity, the FTC, and later the U.S. Court of Appeals for the Fourth Circuit, rejected that argument, holding that the Board was not “actively supervised” by the state, but was instead a group of private business owners exploiting government power.

Fifth Circuit Disobeyed Supreme Court in Allowing Racial Preferences at UT-Austin

Last year, in Fisher v. University of Texas at Austin, the Supreme Court delivered a blow to the use of racial preferences in university admissions by reversing a Fifth Circuit panel opinion that had allows the use of race in UT-Austin’s admissions policy. That wasn’t the end of the story, however; after holding that the university bears the burden of proving that its use of racial preferences is necessary and narrowly tailored—a point on which university administrators are due no deference—the Court remanded the case back to the Fifth Circuit to determine whether UT had offered evidence sufficient to prove that its use of race was “narrowly tailored to achieving the educational benefits” of diversity. 

Recall that UT-Austin’s admissions program fills most of its spots through a race-neutral Top Ten Percent Plan—which offers admission to high school graduates in the top ten percent of their class—then fills the remaining seats with a “holistic” rating that takes into account various factors typical to admissions programs (including race for certain preferred minorities).

Well, on remand, the Fifth Circuit panel split 2-1 but once again sided with the university, holding that even if the Top Ten Percent Plan already provided a “critical mass” of minority students, the use of racial preferences was necessary to achieve some other special kind of diversity.  The dissenting opinion by Judge Emilio Garza points out how the majority has deferred, once again, to the university’s hand-waving claim that its use of racial preferences is narrowly tailored to an actual, appropriate interest, without having actually proven anything approaching what is constitutionally required. 

Abigail Fisher, the white former applicant suing UT-Austin, has asked the full Fifth Circuit to rehear the case. Cato has filed a brief supporting that petition. 

In our brief, we argue that the Fifth Circuit panel failed to apply actual, deference-free strict scrutiny, failed to require the university to define the “critical mass” its race-based policy is intended to achieve, and failed to require the university to explain with particularity why race-blind measures wouldn’t be able to achieve its interests. Rather than require that UT-Austin even roughly define what quanta of black and Hispanic students is necessary to further its diversity goals–a particularly meaningful task given the significant black and Hispanic presence on campus resulting from the Top Ten plan–the university was allowed to skate on vacuous platitudes about “critical masses,” “tipping points,” “upper bands,” and the like. But if interests so vacuous they read like a parody of a Thomas Friedman column were all that strict scrutiny required, why would the Supreme Court have even bothered taking up the Fisher case?

The constitutional laziness and deference the panel majority showed is striking.  The Fifth Circuit should hear this case en banc and correct the errors made by the panel majority, which contradict circuit precedent in various ways.

Further background and Cato’s previous filings in the case are available here.

The Right to Own Includes the Right to Rent Out

Since 2005, the city of Winona, MN will not grant rental licenses to property owners if more than 30 percent of the lots on their block already have rental licenses (the 30% “rule”). The rule contains a “grandfather clause,” however, that allows property owners who had licenses prior to the rule to continue renting even if their block has already reached the 30 percent threshold. Therefore, many blocks in the city violate the rule, which the Minnesota Supreme Court is now reviewing.

Cato has filed an amicus brief, joined by the Minnesota Free Market Institute at the Center of the American Experiment, supporting the property owners challenging the rule. We argue that the rule is an arbitrary, inefficient, and unconstitutional restraint on an essential and fundamental property right because it strips property owners of their right to manage and enjoy their property at the result of actions of their neighbors. The rule also damages communities by reducing property values and creating inefficiencies in the local economy and housing market without a substantial government interest.

First, the rule is a significant intrusion into the fundamental rights of residential property owners because it denies the right to rent—one of the three principal ways to use a property—and significantly limits the right to sell. In addition, since the rule restricts fundamental rights, it needs to be tailored to achieve a legitimate government interest to be held valid—but the rule is both over-inclusive and under-inclusive.

Second, the right to rent is too important to restrict with an arbitrary limit on rental licenses. The rule isn’t an effective way to protect “community character”—its purpose according to the city—especially given the fact that the law has many exceptions and is applied arbitrarily. For example, the rule favors currently licensed property owners and encourages them to add rental properties to their lots, thereby defeating the asserted goal of avoiding rental clustering. Finally, the rule harms communities by artificially depressing property values and increasing the probability of vacancy. It further fails to rationally address the city’s other concerns. For example, one of the rule’s ostensible purposes is to reduce student-housing-related nuisance complaints, but it still allows large groups of students to live together in “theme houses.”

For these reasons, the Minnesota high court should reverse the lower courts’ ruling and protect the full constitutional rights of Minnesota property owners.

(Full disclosure: My condo building established a similar rule a few years ago because, due to federal regulation, it’s hard to get lenders to approve mortgages to finance purchases in buildings with a high rental quotient. Because I’m one of the original owners in my 7-year-old building, my unit is grandfathered in—except the condo board is now trying to apply the rental cap even to owners who predate the rule. It hasn’t come to litigation yet and the issue here is contractual rather than constitutional or statutory—and I don’t plan to rent out my place any time soon—but this episode just reinforced for me the practical importance of the high-fallutin’ principles Cato defends.)

Magna Carta and Constitutional Criminal Procedure

In United States v. Booker (2005), the Supreme Court held that the Sixth Amendment prohibits a judge from sentencing a convicted defendant to a prison term exceeding the law’s maximum penalty for the crime committed, unless additional aggravating facts are found by the jury (or admitted by the defendant). The Court also held that all sentences must be reasonable.

In a subsequent case, Justice Scalia issued a concurrence in which he expressed concern about situations in which judges issue sentences below the statutory maximum, but which would only be reasonable in light of additional facts found solely by the judge. He proposed an “as-applied” doctrine, in which the reviewing court asks whether the sentence would be reasonable as applied to only those facts that were found by the jury.

The situation that Justice Scalia feared has now become manifest for three criminal defendants who were all convicted of selling small quantities of drugs but acquitted of conspiracy charges relating to the distribution of much larger quantities. Despite the acquittals, all three defendants received sentences four times greater than any other defendant convicted of the same crimes in the post-Booker era using the guidelines issued by the U.S. Sentencing Commission.

The defendants argue—and no prosecutor or judge has disputed—that their sentences would not be deemed reasonable without consideration of the additional evidence of conspiracy. In reviewing the sentences, the U.S. Court of Appeals for the D.C. Circuit adhered to settled precedent and declined to adopt the as-applied doctrine, and so the defendants seek to further appeal their sentences to the Supreme Court and finally resolve the question, under the Sixth Amendment, of whether a judge can base a sentence on facts that the jury did not find beyond a reasonable doubt.

In an amicus brief supporting that petition, the Cato Institute, joined by the Rutherford Institute, argues that the Sixth Amendment prohibits the increased sentencing of defendants based solely on judge-found facts of the crime, regardless of whether the final sentence remains below the statutory maximum. The defendants’ constitutional right to a jury trial can be traced back to Article 39 of the Magna Carta, which is also the historical origin of the Constitution’s prohibition on ex post facto, or retrospective, criminal laws.

Article 39 reflected a deep concern that the government would undermine the jury’s role and imprison defendants without the input of their peers. Given the status of sentencing guidelines as “law” for purposes of the Ex Post Facto Clause, the Sixth Amendment should extend to the defendant’s right to the “lawful judgment of his peers,” meaning that a judge can only render a sentence based on the jury’s factual findings. 

In other words, if it’s unconstitutional to sentence a defendant based on rules issued after he commits the purported crime, it must be unconstitutional to sentence a defendant without the input of his peers.

The Supreme Court will decide whether to take the case of Jones v. United States when it comes back from its summer recess.

Marriage Equality in Michigan, Kentucky, and Tennessee

Having filed amicus briefs in Hollingsworth v. Perry (California’s Prop 8), United States v. Windsor (Defense of Marriage Act), and the cases involving the marriage laws of Oklahoma, Utah, and Virginia in the U.S. Courts of Appeals for the Tenth and Fourth Circuits, respectively, Cato and the Constitutional Accountability Center have filed briefs in three marriage-related cases now before the Sixth Circuit. DeBoer v. Snyder questions Michigan’s constitutional ban on same-sex marriage. Tanco v. Haslem challenges Tennessee’s non-recognition of same-sex marriages, while Bourke v. Beshear does the same in Kentucky. 

DeBoer was originally filed to similarly challenge Michigan’s non-recognition of same-sex marriages, but was later amended to attack the underlying issue of the state’s ban on same-sex marriage all-told. In the wake of the Supreme Court’s ruling in Windsor (striking down part of DOMA), the DeBoar district court ruled in the plaintiffs’ favor. The district court in Bourke then ruled in favor of two couples and their respective children; Kentucky’s attorney general had refused to defend the non-recognition law, so the governor hired outside counsel. Finally, in Tanco, decided this past March, three Tennessee couples were also successful in court. The Sixth Circuit stayed all three rulings pending its own examination of the issues presented.

The Cato-CAC position continues to be what we’ve argued all along: The Fourteenth Amendment promises the equal protection of the laws to all persons. It’s a sweeping guarantee that eliminates class-based discrimination that lacks a strong policy justification (for example, denying driver’s licenses to blind people). Though enacted in response to failures to protect the rights of the newly freed slaves, this guarantee was intended to protect the rights of all persons — as demonstrated textually by its neutral phrasing, extending its protections to “any person.” The amendment’s proponents consciously rejected race-specific language. Indeed, in introducing the amendment, Senator Jacob Howard explained that it “abolish[ed] all class legislation.” The common, public understanding was that the Fourteenth Amendment “[took] from the States the power to make class legislation and to create inequality among their people.”

Both early Supreme Court cases and modern precedent demonstrate that it was understood that the Equal Protection Clause spoke in general terms that were considered comprehensive. The equal right to marry the person of one’s choice is guaranteed by that provision. Even opponents of the Fourteenth Amendment acknowledged the fundamental nature of the right to marry. The modern Supreme Court has recognized this as well, most famously in Loving v. Virginia, as well as in Zablocki v. Redhail and elsewhere. 

Laws that prohibit or refuse to recognize same-sex couples’ marriages therefore violate the constitutional guarantee of equal protection of the laws. They impose badges of inferiority on persons based solely on their class and the harm extends to the children being raised by such couples. No compelling state interest is served by and no constitutionally legitimate rationale can be found in such disparate treatment. Merely invoking “tradition” can’t save a practice from constitutional prohibition — as has been shown in cases involving segregation, sodomy, and speech restrictions. The very purpose of the Fourteenth Amendment was to break the tradition of denying the equal protection of the laws to newly freed slaves and other disfavored groups.

The Sixth Circuit will hear argument in all these cases, along with one out of Ohio (to round out the four states that make up the Sixth Circuit) on August 6.

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