Seven-Sky v. Holder
398 U.S. App. D.C. 134
| D.C. Cir. | 2011Background
- Plaintiffs challenge the ACA's minimum essential coverage provision, i.e., the individual mandate, arguing it exceeds Congress's Commerce Clause power and burdens religious exercise under RFRA.
- The district court dismissed the challenges and upheld the mandate as a valid regulation of economic activity within the Commerce Clause, and rejected RFRA claims.
- The Government labels the penalty for noncompliance a 'shared responsibility payment' and treats it as a tax; Congress cross-referenced that penalty to enforceability and collection under the Internal Revenue Code.
- The Anti-Injunction Act (AIA) questions arise because the mandate taxes are labeled as penalties, and because cross-references may place penalties within the tax framework.
- The DC Circuit majority held that the AIA does not bar pre-enforcement review of the mandate, and that the mandate is within Congress’s commerce power as interpreted under Wickard-era and subsequent cases.
- Justice Edwards files a concurrence expressing jurisdictional concerns with the majority approach and arguing the AIA bars this suit, urging stay until 2015.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Anti-Injunction Act bars pre-enforcement challenges to the mandate | Seven-Sky argues AIA bars any pre-enforcement challenge to the mandate as a tax/penalty regime. | Holder contends AIA does not bar challenges to the mandate because the mandate is a regulatory command, not a tax collection action. | AIA does not bar the pre-enforcement challenge to the mandate (majority view). |
| Whether the individual mandate is a valid exercise of Congress's Commerce Clause power | Seven-Sky contends the mandate regulates inactivity, exceeding the Commerce Clause. | Obama argues the mandate affects interstate commerce in aggregate and is essential to a broader regulatory scheme. | Mandate falls within Congress's Commerce power as an aggregated-regulation and Wickard-like rationale. |
| Whether the mandate is permissible under the Necessary and Proper Clause in upholding the broader ACA scheme | Seven-Sky argues no reasonable connection between mandate and the broader ACA powers. | Government asserts the mandate is a necessary component of guaranteed issue and community rating reforms. | Upheld as a valid element of the ACA regulatory framework. |
| Whether RFRA burden on religious exercise is violated by the mandate | Seven-Sky asserts the mandate burdens religious exercise. | Government contends no substantial burden shown by RFRA. | RFRA claim rejected on the merits (district court ruling affirmed). |
Key Cases Cited
- Snyder v. Marks, 109 U.S. 189 (1883) (definition of 'tax' under Anti-Injunction Act context)
- Bailey v. George, 259 U.S. 16 (1922) (tax penalties treated as taxes for some purposes)
- Bob Jones Univ. v. Simon, 416 U.S. 725 (1974) (pre-enforcement tax challenges governed by AIA; tax-related relief avenues)
- Americans United for Separation of Church & State v. Americans United, 416 U.S. 752 (1974) (cannot evade AIA by challenging regulatory effect of a tax)
- Enochs v. Williams Packing & Nav. Co., 370 U.S. 1 (1962) (AIA is jurisdictional and governs pre-enforcement challenges)
- Lopez v. United States, 514 U.S. 549 (1995) (limits on regulating inactivity and intrastate activity)
- Wickard v. Filburn, 317 U.S. 111 (1942) (aggregated effects justify regulation under commerce power)
- Raich v. Gonzales, 545 U.S. 1 (2005) (aggregate effects doctrine under Commerce Clause validates regulation)
- Morrison v. United States, 529 U.S. 598 (2000) (limits on regulation of intrastate non-economic activity)