The blog in a nutshell

The blog in a nutshell

Wednesday, March 23, 2016

So what if it is 4-4

If the Supreme Court is deadlocked, at 4-4, all the decisions are affirmed without any precedent set.  In the Contraception Cases, as far as I am aware, the 3rd, 5th, 6th, 7th, 10th, and D.C. circuits have all ruled for the government, and the 8th Circuit has ruled against the government.  I am not sure if  the 1st, 4th, or 9th Circuits have reached any decision, but given the tilt of those Circuits, they'd be likely to join the majority (either in a panel decision or en banc*).  The Second Circuit rarely goes en banc, so it is possible that a conservative panel could hear the case first, decide the issue, and then the 2nd Circuit will just let that be the law; but unless the 4-4 split is resolved soon, I would bet this would be the exceptional case the 2nd Circuit does take en banc. 

Normally, a circuit split isn't a problem, because the connection between what the law is and who must follow it is pretty straightforward.  A rule that conduct A is criminal in the Fifth Circuit but not in the Eighth Circuit means that the conduct is lawful in one but not the other.  

But the problem is, the same conduct is often subject to the jurisdiction of multiple courts.  If you sell your product on the internet, and ship to all fifty states, you might be sued (or criminally prosecuted even) for that conduct in any court.  And unlike state law, there is no "choice of law" analysis regarding circuit splits.  If the Fifth Circuit thinks that 18 USC XXXX makes certain conduct a crime, it won't excuse that conduct merely because the criminal case could also have been brought in another Circuit that disagreed.  

So, what is the result?  Well, if someone wants to commit certain conduct that only the Fifth Circuit thinks is criminal, it can do so unless done in a way that would give the Fifth Circuit jurisdiction.  Likewise, if some conduct is considered subject to punitive damages in the Fourth Circuit but not the Fifth Circuit, and someone commits an act that would subject him to suit in the Fourth or Fifth Circuit, then whether or not he faces punitive damages or not depends on where the plaintiff sues him, and whether he can get a change of venue.

What does this mean for the religious  objectors?  I am not entirely sure.  In these cases, the claims were all brought by the objectors against the government, seeking a declaratory judgment that they don't have to sign the notice at issue.  So what happens then?  It depends.

First, it's theoretically possible that the government can bring an enforcement action against certain subjects that do business in the Eighth Circuit and another jurisdiction, making sure to bring the case in the other jurisdiction.  But knowing that, entities that want to avoid the accommodation and still deny their employees contraceptive care can preempt this and bring a declaratory judgment act against the government in the Eighth Circuit.  I'm not 100% sure the federal government is bound by these decisions in later enforcement actions, but I suspect the federal government wouldn't choose these cases to press the issue in any event.

So, at first glance, it's pretty simple.  Those companies who do business in the Eighth Circuit can get a declaratory judgment that they don't have to sign the form, and everyone else has to comply with the accommodation.

But does that resolve the matter?  Not quite, for three reasons.  First, it isn't clear what connection, if any one needs to the Eighth Circuit to bring a declaratory judgment action.  Second, the declaratory judgment action between the federal government and the objecting party only binds the federal government.  And third, it's not clear--due, in part, to the objectors own obfuscation of what they are trying to accomplish--what relief the objectors would be entitled to.

Let's look at one of the Eighth Circuit, plaintiffs, Cornerstone University.


Cornerstone University is based out of Grand Rapids, MI.  Yes, that's the same Cornerstone University.  The Eighth Circuit doesn't cover Michigan; the Sixth Circuit does.  The Sixth Circuit ruled that the contraception accommodation does not violate RFRA.  Why is this case before the Eighth Circuit?  To be honest, I have no clue.  The best I can think of is that the government didn't bother to challenge venue in the case.  But I'm not a jurisdiction expert and I don't have the whole case file.  Maybe it's always possible to challenge a government regulation anywhere, so that the government cannot challenge venue.  If so, everyone can file a declaratory judgment against the United States in the Eighth Circuit- I honestly don't know.  If someone knows more, please comment and I will update.


So Cornerstone University got its declaratory relief.  But now one of its employees doesn't have health care.  Can he sue?  Probably not.  The penalty for non-compliance with the coverage mandates is a tax penalty, but I'm not aware of a private cause of action.  So that won't help the Michigan employer.  Again, please let me know if I am wrong here and I will update.


What right does the Eighth Circuit award?  This is the rub.  The litigants have been as careful as they can not to frame their claimed burden as an inability to control third-parties from acting.  They've been entirely vague, using weasel words such as "facilitate" to avoid the fact that what they object to is what some other party is doing.  The closest thing the Eighth Circuit came to announcing exactly what the burden involved was, that Objectors "argue that they 'must still submit a document that they believe wrongfully facilitates the delivery of such coverage.'"  Sure, the litigants have argued to the Supreme Court that even requiring their contractee to provide coverage hijacks their contract, but this argument was not accepted by the Eighth Circuit, and a 4-4 decision would leave no analysis (binding or not).

So no notice, fine.  But what if the government decides (properly, changing whatever regulations might otherwise disagree) that no notice is necessary?  Instead, as suggested in the objectors' brief to the Supreme Court, an individual's notice suffices.  And so the Michigan employee who is very upset calls and tells the HHS that they aren't providing the health care in question.  What then?

I think the right answer is that the Government can call the insurer or third-party administrator up and tell them they have to provide that coverage (or, heck, they can probably require the third party administrator, known as a TPA, or insurer do it even without notice, because the fact that the proposed coverage *doesn't* cover contraception is probably sufficient constructive notice).  Presumably, the insurer will then provide coverage.  

Now, one of five things, four interesting, can happen.

One, the insurer/TPA can do what its told.  

Two, the objector can sue either the government or the insurer/TPA, claiming that this provision by the third party violates their rights.  But I think that would nakedly call out what the objectors are doing here, and the Eighth Circuit opinion does not go so far to validate such a claim.  

Three, the insurer/TPA - presumably based on a threat from the objector that they will withdraw the plan - can refuse, and the government *might* be able to bring a claim against the insurer/TPA.  I'm again not sure here, so if someone knows the details, please let me know and I will update.  But my guess is that they likely can, otherwise the insurers would have little reason to provide these this coverage under the accommodations now - after all, the insurers have to do so without recovery of cost the insurers.  The TPAs get reimbursed, but cannot make a profit, and could still be pressured by the objector to disobey if there was no legal repercussion.

Four, the same situation as three could arise but they could bring a claim against the objectors for their interference.  But such interference might be hard to prove.  And presumably, if the insurers are not subject to repercussion then it also isn't illegal for the objectors to encourage non-cooperation.  And if they are, then the government would just go after the insurers.

And five, the government can decide that the objector's plan is not qualified, and deny the tax credit.  Then the objector will bring a claim (or defend one, depending how it plays out) on the basis that they provided health care to the best that they religiously believed.  The government will argue that it was the interference, not the provision of health care, which led to the denial.  I think this argument probably ends up in the objector's favor here.  If contraception *is* part of the package, that matches up perfectly with the framing of the objectors, and in that case they probably *should* win under Hobby Lobby.

This post isn't intended to give answers, exactly.  If it did, I suspect I failed.  Rather, it points out the uncertainty of a split decision and the need for uniformity here.  The failure of uniformity could lead to a certain level of chaos and unpredictable results that I think the Supreme Court should be very careful about before deciding to split 4-4.

* En banc means decided by the court as a whole.  Assuming jurisdiction, the vast majority of appeals are heard by the circuit courts as a matter of right in 3 judge panels.  If one objects to the decision, they can petition the courts of appeal to hear the case as a whole.  This is what en banc is.  It is entirely discretionary, much like appeals to the Supreme Court in most cases.  If a panel decision is not heard en banc, it is binding on all future panels of that circuit, unless the case goes en banc or if it is overruled by the Supreme Court.

1 comment:

  1. There is part of me that wonders if the administrative disaster might not encourage the Court to split 4-4. If they wanted to make the point that they need a full Court to do their job properly, this might be a good case for doing that.