The blog in a nutshell

The blog in a nutshell

Wednesday, September 16, 2015

Problems with the Challengers' Post-Mortem in Burwell

[Again, I am going to write in stream-of consciousness now, and then edit and add links when I have time in the future.]

The Burwell challengers (not the plaintiffs themselves, who are not important people, but the architects of the litigation) have published an article summing up their affair.  I have not read it yet, but the abstract, unsurprisingly, indicates that they disagree with the opinion.  One of the challengers, Professor Adler, published a blog post about his article, in which he makes the following statement:

"[T]he majority not only used statutory context to resolve ambiguity, but to create the ambiguity in the first place." (Emphasis Adler's.)

There are three problems with this statement, which is the principle point of Adler's post.

First, the statement is factually wrong.  The question in front of the Court was not, no matter how loud the challengers claim, whether "State" included the federal government.  Although "State" sometimes does mean the federal government, the *context* of the ACA indicates that it does not, because State is elsewhere defined in a way that excludes the federal government.  Instead, the question was whether the "such Exchange," language in Section 18041 encompasses those Exchanges that are "established by the State."  And, as explained in my previous post, that is ultimately an ambiguous question absent any additional context.  This is particularly true if you are also allowed look at definitions as somehow not "context."  Here, the tax-limiting language at issue was "Exchange established by the State under [sic: Section] 1311" and Section 1311 defines an "Exchange" as one established by the State, and yet Section 18041 (the pertinent language that is really in dispute) gives the government a right to establish an "Exchange."

Second, it is not at all problematic that context could create ambiguity even if true.  That is because, outside of context, words and phrases don't actually mean anything.  And while one could read an isolated phrase and guess at or imagine context, it is a bedrock principle of law in the United States that courts interpret statutes as a whole, not isolated words or phrases.  So there's actually nothing wrong with context creating an ambiguity, even though that is not what happened here.  All an ambiguity means is that the language is susceptible to two or more meanings, rather than one precise meaning.  So, while one should generally try not to give meaning to language that appears to contradict the text - it's fair to say that it would be alot easier to construe statutes when you don't have to read the whole statute to determine whether a law which regulates birds actually also regulates fish because birds are later defined to include fish - it is quite normal for courts to construe language seemingly unambiguous devoid of context in an entirely different way given context.  Just this past term, the Supreme Court defined "a tangible object" to exclude fish, when fish are clearly both tangible and objects; the bill at issue was directed at financial fraud.  And the prior term, the Supreme Court defined the use of a chemical to give a rival a rash as not a "chemical weapon," even though the chemical was plainly used as a weapon, because the statutory context indicates that the law intended to prohibit weapons of mass destruction.

And third, Adler's created a false dichotomy.  He wants to claim that the ACA can't treat an "Exchange" to mean an "Exchange established by the State" because that would create an ambiguity, but not doing so would create a lot more ambiguities out of otherwise quite plain language *even under his interpretation*, such as can an "unqualified" individual purchase an insurance policy on an exchange, or whether an "Exchange" is only one established by the State (as plainly defined by Section 1311), and if so, what on G'd's earth "such Exchange" could possibly mean?  So it's not between "creating an ambiguity out of otherwise plain language," but instead selecting between language that is unambiguous in isolation but, despite being unambiguous,  conflicts with each other (Except it isn't even that, because of Point 1 above.)

Finally, although not the main thrust of Adler's point, I want to address another issue Adler raises in his post:

"Though Roberts conceded that “established by the State” is clear on its face and the only statutory text that speaks directly to the question presented, by the time he was done, he rendered that provision not only ambiguous but meaningless."  (Again, emphasis Adler's.)

Three very quick points here.  

One, the term is not meaningless: it references the requirement that the taxpayer purchase the exchange in a particular jurisdiction, i.e., the jurisdiction the taxpayer resides.

Two, as the Opinion points out, while there is a canon preferring the interpretation of a statute that renders no part of the statute either meaningless or superfluous, that canon is considered rather weak.  This is because, although one should not endeavor to repeat oneself or add unnecessary verbiage, people do this *all the time,* and particularly lawyers.  Indeed, although the judge I clerked for hammered it into me to be succinct and not repetitive, a former boss thought that good legal writing required one to repeat yourself ad nauseum to make sure the reader got the point.  Again, this wasn't the most well-written law, but Courts are not empowered to overturn or ignore laws merely because they think it was poorly written. 

Three, Adler claims that this was *the only provision* that answered the question Adler was asking.   I'm not sure this is true, because there's another provision that answers the question:  *such as*!  (It is sure easy attacking someone's logic when you can ignore their main argument, right?)  But that's almost certainly because there was no reason to *ask* the question that Adler was asking.  As even the dissenting Justices understood in arguing that the ACA was unconstitutional, either the subsidies are available everywhere, or there's no point to the exchanges.   It's easy-very easy-to criticize Adler.  But there's a broader problem I think lawyers and judges have in interpreting statutes and contracts:  often, a law or contract has nothing to say about a topic, either because they assumed it wasn't an issue or they simply did not think about it.  But judges and advocates alike nevertheless barrel toward the closest thing they can find to read an intent that simply is not there.  That is not interpretation, but divination, and it has no place in proper legislative interpretation.

King v. Burwell: A post-mortem

[NOTE:  I am posting this now in stream of consciousness, adding links as appropriate later.  In doing so, I reserve the right to edit the text to conform to the links.]

So in the last Supreme Court term, the Court heard another challenge to the American Care Act, better known as Obamacare.  In that case, King v. Burwell, conservatives discovered post-passage a clause, which, read out of context, would appear to eliminate subsidies for individual insurance plans purchased on exchanges unless the state established the exchange instead of the federal government.

Although the ACA specifically contemplated federal exchanges, and its supporters and opponents alike understood that the exchanges and the entire health care system would fail without the subsidies-indeed, creating a "death spiral" which would not only render Obamacare ineffective but actually render serious harm on the markets of those states who lacked subsidies.  This "death spirial" is because without the subsidies, the individual mandate requirement would mostly be eliminated.  But, since health insurers would still be required to issue plans to sick people without charging them a higher rate or denying coverage for pre-existing conditions, healthy people would have an incentive to wait until they got sick until they had coverage.

Still, because conservatives believed that the destruction to the state markets would either require repeal of the ACA or at least destroy public perception of the ACA, conservatives pressed with their theory.  The theory was this:  in the section of the bill which calculated the amount of a tax subsidy,  the amount capped as the amount paid that was purchased "through an Exchange established by the State."  According to the challengers, that meant an insurance plan purchased on an exchange established by the federal government could not obtain any relief, since an Exchange established by the federal government cannot be "an Exchange established by the State," thus making the cap $0.  Now, this section - like the bill - was not a model of legislative drafting.  Indeed, the very section refers to "an Exchange established by the State under 1311," without specifying whether 1311 was a year, a number of plans, an amount of money, etc. - context makes plain that the authors meant "Section 1311."  And 1311 states that states "shall"  establish an American Health Benefit Exchange (referred to in this title as an ‘‘Exchange’’). 

But it turns out an Exchange established by the federal government could be "an Exchange established by the State."  This is because, up until this point in the legislation, there was only one kind of Exchange mentioned - one established by a state.  Indeed, the bill unconditionally, in  requires states to set up an exchange.   But, knowing that states might not comply - and knowing that federalism principles in fact does not permit Congress to order the states to comply - the Exchanges had a backup.

Specifically, if the state does not establish an exchange, Section 18041(c)(1) of the ACA directs the government to "establish and operate such Exchange within the State and the Secretary shall take such actions as are necessary to implement such other requirements."  Not "an exchange," but "such exchange," i.e., the same exchange the state was obligated (but failed) to establish.
Of course, the challengers generally tried to argue that two different types of exchanges were defined in the statute as a whole.  But there were serious problems with this attempt.  The most prominent problem, but not the only one, is that the challengers' interpretation would mean that federal exchanges would have no qualified purchasers who might buy things on the exchange, and that these exchanges would be largely.  A second problem is that there are no specific references to an "Exchange established by the federal government," meaning that the bill would have nothing to say about them specifically.  And a third problem is that the very distinction is belied by the fact that Section 1311 itself defines an exchange established by the State as an "Exchange."  Thus, under the challengers' views, an "Exchange" would expressly be defined as one established under 1311, but would actually mean, in a world with 2 different exchanges, an exchange established under 1311 or 18041. 

Now, is an exchange established by the federal government a Section 1311 "Exchange established by the State" or just a Section 18041(c) "Exchange?"  Outside of context, it obviously could be both.  Context could help - if the statute clearly delineated, in a meaningful way, between "Exchanges" and "Exchanges established by the state," defining the parameters of both, that would tend to show that there was an intended distinction, possibly eliminating ambiguity.  But in reality, other than the fact that the language sometimes isolated from "Exchange" to "Exchange established by the State," only one type of exchange was delineated.

In my view, these contextual problems foreclose any possibility that the "such exchange" that the federal-created exchange acted as was anything other than the only kind of exchange created, i.e., "an exchange established by the State under Section 1311."  Whether you disagree or not depends on your tolerance for ambiguity, and the use of context.  But, important for this post, note that *even without the context of all these problems,* it would still be ambiguous whether "such exchange" would mean an "exchange established by the State" or "an Exchange (but not one established by the State)."

The Court, unlike me, found the statute ambiguous as a whole.  It could have ruled for the government on that issue alone if it found, under a theory called Chevron deference, that the government had the right to define the ambiguity, though it would allow a Republican President to undo the ruling by simply changing the government's position.  The Court (correctly, in my view, to the extent it felt the need to reach this issue) rejected the use of Chevron, implicitly limiting or overruling another decision (called City of Arlington), that I disagree with.   

But, given all the policy and statutory problems caused by the challengers' interpretation, it rejected their argument and held that the law, properly read, renders the "such exchanges" created by the federal government "exchanges established by the State."  And then it states, implicitly but certainly not quietly, that it is done hearing creative challenges to the ACA by those who wish to see it undone.

I think this decision creates a very interesting question as to what it means for a statute to be ambiguous when there is no deference, nor any rule for construing the statute for or against a particular party.  But that is not the point of this post.

The purpose of this post is to explain the Burwell decision, and to set up the next post, which will explain why the challengers' post-mortem is wrong.

Friday, September 11, 2015

The Political Question Doctrine and the "Not an Agreement" argument

So yeah, now posting with titles!  Good job, me.

I didn't address the political question doctrine or the standing issues before because they are, quite frankly, obvious.  Here goes.

First, standing.

Federal courts don't hear cases "just because."  Someone needs to be concretely harmed, and a Court must be able to do something to resolve the injury, before a Court steps in.  They don't do advisory opinions, even if you really want to know a legal answer to a question.

Has Congress been harmed?  No.  Absent special circumstances, Congress doesn't have any legal "interest" in the laws they pass.  A district court, for the first time, recently found that there's a very narrow exception to that rule.  According to that judge, Congress has a legal interest in making sure that the Executive does not violate the Appropriations Clause, by using money that Congress never authorized to be spent in a certain way.  (If you're a government accountant, think Antideficiency Act stuff.  Otherwise, don't worry about it.)

Now, new exceptions come up from time to time.  Recently, the Supreme Court allowed Congress to defend a statute - the ultimately-ruled-unconstitutional Defense of Marriage Act - when the Executive declined to defend it (because it was unconstitutional).  But the exception provided by that Court doesn't really have a principled distinction, and even supporters of the decision think it is likely to be overturned.

But this doesn't concern the Appropriations Power, so that decision wouldn't even apply.

Now, Eugene Kontorovich argues that standing can be manufactured without Congress.  Specifically, he claims "a state Attorney General wishing to promptly challenge the President’s actions can easily do so by finding a company to enforce state sanctions laws against."  

This is wrong.  If a state AG did this against a proper defendant, the defendant would merely argue preemption.  And would win.  Indeed, without going into the details, the Supreme Court has held that even a state plan to divest interests in another country's economy is illegal to the extent it conflicts with the federal interest in a uniform sanctions policy.  If the state of Massachusetts cannot even prevent *itself* from doing business with Burma, the state of Utah certainly can't prevent its citizens from doing business with Iran.  And even if the defendant (say, due to unethical coordination, or just a bad defense lawyer) chose not to argue preemption, you can be sure that (if it happened in an important enough court - I am not sure whether anyone cares about a decision of the Pennsylvania Court of Common Pleas has to say about Corker-Cardin), the federal government would intervene and make the argument.  And remember - because the issue is what is called "field preemption" and due to the language the Supreme Court has used for "uniformity," this would be the outcome no matter what the Court thought of the meaning of "agreement" in Corker-Cardin.
So, this issue is not going to be resolved because nobody has an interest in it.  But even if someone did have an interest, it still wouldn't be resolved by a court.

Why not?  Political question doctrine.  At its heart, according to Wikipedia/Professor John Finn:

The political question doctrine holds that some questions, in their nature, are fundamentally political, and not legal, and if a question is fundamentally political ... then the court will refuse to hear that case. It will claim that it doesn't have jurisdiction. And it will leave that question to some other aspect of the political process to settle out.

And if there was *ever* a case to apply political question doctrine, it is here.  Political question doctrine states that no decision will be made if *any one* of the following issues requires abstention:

A "textually demonstrable constitutional commitment of the issue to a coordinate political department; or"
A "lack of judicially discoverable and manageable standards for resolving it; or"
The "impossibility for a court's independent resolution without expressing a lack of respect for a coordinate branch of the government; or"
The "impossibility of deciding the issue without an initial policy decision, which is beyond the discretion of the court; or"
An "unusual need for unquestioning adherence to a political decision already made; or"
The "potentiality of embarrassment from multifarious pronouncements by various departments on one question."

1) The Constitution, however, gives no role to the judiciary on issues of foreign affairs. 

2) There is, again, almost no judicially discoverable and manageable standards for resolving the dispute - and, as noted in my prior post - it appears more likely than not that Congress reserved to itself the ability to be a decisionmaker by voting to disapprove the agreement.  (Note, they could have also decided to reserve it for itself by requiring a vote to approve the agreement, but chose the framework that they chose.)  

3 and 4) The decision would be fraught with the highest-stakes of policy decisions (i.e., war with Iran) and infringement on respect for the executive.  

5) There would certainly be an "unusual need for unquestioning adherence to a political decision already made," because funds will have already be released, and multilateral sanctions already dropped, by the time of any decision.  

6) And, finally, embarrassment would be the least of the problem of a dispute between a court - even the Supreme Court - and the Executive on whether we have a deal with Iran.  After all, while the Supreme Court can generally block executive action (so long as the executive doesn't tell them to shove it), they have very little ability to compel the government to act.  So it will be left to states alone to use their very meager resources to impose sanctions.  The result would be political humiliation in the world's eye, to say the least.

So, yeah, no Court is going to touch that with a 20 foot pole.  Most Republicans in Congress are depending on this - the argument is a loser, and since Americans do not have the appetite for all-out war with Iran, its success would only empower that nation.  They don't want a court to belatedly reimpose sanctions.  What they want is to discredit Obama and the deal politically, so that they can win an election in 2016, sop to their base, and hopefully cast enough doubt regarding the deal's stability that a Republican President (it's technically possible) might have more leverage in Congress and international diplomacy to take a more hardline stance against Iran.
Over at the Volokh Conspiracy,  Eugene Kontorovich has a series of posts  about David Rivkin's theory that President Obama's failure to submit the agreement between the IAEA and Iran regarding the details of certain IAEA inspections of Iranian nuclear sites somehow violates the Corkin-Cardin framework.

First, for those of you who are new here (everybody, except I am sure nobody is reading this), the Volokh Conspiracy is the conservative blog whose members championed, among other things, the various challenges to Obamacare, while Rivkin was heavily involved in those efforts as well.  So while the argument they make is fringe - it was not mentioned by anyone until Democrats had secured the votes to prevent disapproval - as you will probably see over the next days and weeks, it will become a mainstream Republican position.  Indeed, House Republicans are planning a vote for some reason on this "issue," even though it is, at heart, a (bad) legal argument, not a legislative policy argument.

Second, the argument according to Rivkin is that the IAEA-Iran deal is a "side agreement."  Kotorovich takes a different position, which is that it is not a side agreement, but part of the agreement itself.  Both are wrong, but I first want to point out why this matters, and why it does not.

Under the Corker-Cardin framework, Obama had 5 days from reaching an agreement with Iran to transmit three things:  the "agreement," a state department report about the adequacy of safeguards in the agreement, and a Presidential certification that the agreement is complete, and conforms to the US's legal obligations and non-proliferation objectives.

Once the agreement is certified, then Congress has a specific timeframe - ending September 17 - to disapprove of the deal.  Such a disapproval would only take into effect if the disapproval not only passed both houses of Congress, but was either signed by the President, or if Congress overcame a presidential veto.  Since there are 42 votes in favor of the deal in the Senate, that isn't going to happen - the vote of disapproval was successfully filibustered and will continue to be filibustered until time runs out.

But, according to Rivkin and Kontorovich, the side-agreement, which the United States (including the President himself) does not have access to - the IAEA historically never releases the contents of these arrangements - is part of the agreement.  Because it was not transmitted to Congress (Obama did not even have a copy of it), the theory goes, the "agreement" was not transmitted to Congress, and so the Congressional review period was never initiated.

Is that correct?  I don't know (although I think it is pretty clear that this is not the type of question a court will likely ever answer).  I think it is pretty clear that there was an agreement.  And Obama did transmit an agreement to Congress.  Assuming the substantive theory of R+E is right (it's not, we'll get to that), then Obama still sent *an* agreement to Congress.  I think other than "the clock hasn't started," there are two significantly more likely outcomes from a legal process view:

1 - The President has the right, consistent with his certification, to decide what is part of the agreement and what is not, and if Congress disagrees, they have a remedy specifically listed in Corker-Cardin: they can disapprove of the agreement; or

2 - The President imperfectly performed his obligation, and thus violated the law, but there's no remedy here, other than voting down the agreement, or perhaps impeachment.

So overall, while the arguments are dressed up as legal arguments,  they are really political arguments.  Their purpose is to legitimize the deal in the public eye, and to continue the narrative of Obama as a lawless, perhaps un-American, president.  But since they are legal arguments in the abstract, I think it is important to determine if they are correct.  The answer is no.

The Agreement ("JPA" or Joint Plan of Action) is defined by Corker-Cardin:

“(1) AGREEMENT.—The term ‘agreement’ means an agreement related to the nuclear program of Iran that includes the United States, commits the United States to take action, or pursuant to which the United States commits or otherwise agrees to take action, regardless of the form it takes, whether a political commitment or otherwise, and regardless of whether it is legally binding or not, including any joint comprehensive plan of action entered into or made between Iran and any other parties, and any additional materials related thereto, including annexes, appendices, codicils, side agreements, implementing materials, documents, and guidance, technical or other understandings, and any related agreements, whether entered into or implemented prior to the agreement or to be entered into or implemented in the future."

So let's start with Rivkin's argument.  Is it a "side-agreement?"  Almost certainly not.  First, a side agreement is an agreement that is part of "any joint comprehensive plan of action entered into or made between Iran and any other parties."  The "other parties" to the JPA are France, Germany, England, Russia, and China.  The IAEA is not an other party, so for that reason alone it is not a "side agreement."  Second, as Professor Rob Howse explains, an agreement - including a side agreement - is one where "the United States commits or otherwise agrees to take action."  The side agreement, remember, is an agreement between Iran and IAEA which details how Iran is going to comply with Iran's obligations under the JPA.  The United States makes no commitment, legally or otherwise, under the agreement.  (Kontorovich disagrees, but his disagreement is plainly based on him conflating Iran's obligations and the United States's obligations.)  And finally, nothing in the JPA, and none of the United States's obligations, are contingent on the contents or existence of the IAEA-Iran agreement.  Sure, without the agreement Iran would likely not allow IAEA inspectors to perform their jobs, and so *Iran* would be *violating* the agreement, but there would still be an agreement - just one that has been breached.

The beauty of Rivkin's argument is that it is simple and facile.  The agreement includes "side agreements," Republicans have successfully labeled it a "side deal" in the press, so it must be covered.  This is legally wrong, but remember, the argument is fundamentally political, not legal.  And the public does not have the attention span for detail.  So it is, in fact, a clever argument.

Kontorovich's argument is more nuanced.  It's a law professor's argument, not a political one.  And so it will ultimately be irrelevant.  But it is wrong too.  Kotovorvich claims that it is “implementing materials,” since, according to Kontorovich, "these arrangements implement the Roadmap, which is explicitly incorporated into the" JPA.  (This is what I said above - the agreement allows Iran to fulfill its obligations under the JPA.  But when Kontorovich says "incorporated," to the extent he means contingent, he's just wrong.)

The Agreement definition does include "implementing materials, documents, and guidance, technical or other understandings, and any related agreements, whether entered into or implemented prior to the agreement or to be entered into or implemented in the future."  But Kontorovich's argument requires an unnecessarily context-free analysis of the meaning of these terms.  Based on Kontorovich's uncharitable reading, it "implements" the deal, thus is it is incorporated, thus it must have been transmitted within 5 days.

But 5 days!  We don't know when the IAEA-Iran deal took place.  It became public 7 days after the agreement was signed, but we don't know if it was agreed to 6 days after, 1 day after, or before the JPA became official.   But, certainly, some implementing material would occur after the agreement took place - even the definition of  the supplemental materials to be transmitted includes the language "whether entered into or implemented prior to the agreement or to be entered into or implemented in the future." And yet, unless Corker-Cardin was intended to accomplish nothing, there can be no requirement to transmit incorporating materials that do not even exist at the time transmission is due.

Instead, there's an easier way to understand the definition of agreement.  Many of us have signed agreements all the time - credit card agreements, employment agreements, etc.  They will generally incorporate or be contingent on other documents or agreements.  They will contain appendices, they will refer to laws, regulations, or "terms of service" of a website, etc.  What the definition of agreement means, is that the President should not just submit the list of clauses agreed to.  He should submit everything incorporated by reference or contingency as well, to the extent it existed at the time.

And this is where Kontorovich's claim fails.  The future existence of an Iran-IAEA agreement was contemplated by Iran, the United States, and the other parties at the time of the signing.  But it wasn't incorporated into the agreement (you can look, but we almost don't have to do this because it was such a surprise when discovered through third parties days after the agreement was transmitted to Congress).  And so it's not covered by the definition.

Think of it this way.  You just entered into a contract to buy a new house.  You need to submit the deal for regulatory approval, including all the "related documents."  That includes, of course, the appendices, the deed, and any contingencies and side-deals (say, they agree to kick in $1000 for closing, you agree not to inspect whether that musty smell in the basement is mold).  The deal is *not* contingent on financing, as you are not taking out a loan.  But in order to close the deal, you need to sell your old house - it's the only way to raise the money.  Do you need to provide the agency the contract to sell your old house?  Of course not.

Under no commonly understood interpretation of the term "agreement" would that sale be considered part of the agreement to buy the new house. Athough I am trying desperately to avoid citing cases in this blog (we'll see how long it lasts), the Supreme Court just decided that we have to look at the general understanding of a defined word and the context of an agreement to understand the meaning of the defined word itself, so that we don't take an overbroad, overliteral definition of a "chemical weapon" to render a woman who gave a guy a rash with some potassium dichromate a terrorist.  Likewise, we would never consider an agreement between Iran and the IAEA, to which the US does not even have access, to be part of an agreement between the Iran and US.

- J

PS - I said above that no court will take this issue up. I may or may not do a follow up post on why that it is, but I think the idea that a court would take this up to be so unlikely that I doubt that there will ultimately be any real effort.  That is why I label the argument a fundamentally political one.

So, this is a blog which will mostly review legal issues, although everything from sports to crafts may ultimately be fair game.  (Hey, if Kevin Drum can cat blog, I can complain about sports.)  I chose the name dubitante - doubting the accuracy of - because one of the things I most want to do with this blog is criticize either existing or proposed legal theories.  Yes, the critic sucks, but do you know what also sucks?  Denying people health care over a fear of broccoli.