In two rulings this week, the Richmond-based Fourth U.S. Circuit Court of Appeals threw out two challenges in Virginia to President Obama’s health care overhaul that requires that nearly all Americans buy health insurance or pay a penalty.  The rulings were based solely on procedural grounds and not on the merits of the law.

The Fourth Circuit issued side-by-side rulings in response to separate lawsuits brought by Virginia and the conservative Liberty University.  Both cases challenged that the law’s requirement that mandates Americans buy health insurance is unconstitutional.

The court said Virginia, the only plaintiff in the case, has no right to bring its lawsuit because unlike individuals, the state itself is not burdened by the individual insurance requirement.  “The sole provision challenged here–the individual mandate–imposes no obligations” on the state itself, the court said.  “A state possesses no legitimate interest in protecting its citizens from the government of the United States,” Judge Diana Gribbon Motz wrote for the court.

In the case of Liberty University, the same court ruled 2 to 1 that the legal challenge had come too soon.  The court ruled that the penalties mandated amounted to a type of tax that can only be challenged after it is collected, rather than before.  The enforcement of the insurance penalty does not begin until 2014.  The court maintained it does not have jurisdiction to judge whether the law is unconstitutional because of the Anti-Injunction Act, which requires Americans who want to challenge taxes to first pay the tax and then ask for a refund.  Judge Motz, again writing for the court, left open the possibility that the plaintiff Liberty University could prevail should it challenge the law after enforcement has begun.

The Fourth Circuit is the first court to side with the Obama administration’s legal argument that the penalty that is mandated by the law for those that do not buy insurance is a tax.  Although President Obama maintained through the debate on health care reform that the penalty was not a new tax on the middle class and Congress did not use the word “tax” when the law was written, Department of Justice attorneys have repeatedly embraced the argument that the penalty is indeed a tax since Congress has a clear authority to tax.

Both Virginia and Liberty University have said they would appeal any rulings against them, but the plaintiffs would most likely spend significant time arguing the procedural issues.

The Fourth Circuit was the first federal appeals court to hear an appeal in one of the more than 30 legal challenges to the health care law.  But it is the third to issue a ruling and comes only a month after the 11th Circuit Court of Appeals struck down the individual mandate in a lawsuit by 26 states and more than two months after the 6th Circuit Court of Appeals upheld the legislation in a separate challenge.

 

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