Judges dismiss Virginia's challenge to health-care law

A Richmond-based federal appeals court on Thursday tossed two lawsuits challenging the constitutionality of President Barack Obama's health-care overhaul, cases brought by Virginia Attorney General Ken Cuccinelli and Liberty University.

In a strongly worded ruling, the three-judge panel for the 4th U.S. Circuit Court of Appeals said Virginia lacked legal standing to challenge the constitutionality of the individual-mandate provision of the Patient Protection and Affordable Care Act.

The panel rejected the argument that a state law that says Virginians cannot be required to buy health insurance "confers a sovereign interest" to the commonwealth that allows it to challenge the federal law.

"The mere existence of a state law like the (Virginia Health Care Freedom Act) does not license a state to mount a judicial challenge to any federal statute with which the state law assertedly conflicts," wrote presiding Judge Diana Gribbon Motz.

In March 2010, Cuccinelli challenged the health-care overhaul, arguing that Congress had overstepped its authority in enacting the insurance-mandate provision of the law, which requires every American to obtain health insurance by 2014 or pay a penalty.

Virginia won the first round in U.S. District Court last fall. The U.S. Justice Department appealed, and the randomly selected three-judge panel — made up of Motz, who was nominated by President Bill Clinton, and two judges appointed by Obama — heard the case in May.

On Thursday, the three judges dismissed Virginia's case without considering the constitutional merits of the mandate.

Cuccinelli previously has said he would not ask the full appeals court to rehear the matter but instead would appeal an adverse ruling directly to the U.S. Supreme Court.

"Our disappointment not only stems from the fact that the court ruled against us," Cuccinelli said Thursday, "but also that the court did not even reach the merits on the key question of Virginia's lawsuit — whether Congress has a power never before recognized in American history: the power to force one citizen to purchase a good or service from another citizen."

Gov. Bob McDonnell also sharply criticized the ruling.

"To conclude that a state has no standing to challenge an expensive and burdensome federal mandate on its citizens that the state has banned in its law, might cause James Madison and George Mason, Virginia's principal drafters of our nation's founding documents, to promptly roll in their graves," he said.

Cuccinelli had argued that because the individual mandate was an unconstitutional exercise of congressional power, a state law that says Virginians cannot be compelled to buy health insurance should prevail. Virginia lawmakers passed the Virginia Health Care Freedom Act shortly before enactment of the federal law.

"The VHCFA regulates nothing and provides for the administration of no state program," Motz wrote. "Instead, it simply purports to immunize Virginia citizens from federal law."

"The only apparent function of the VHCFA is to declare Virginia's opposition to a federal insurance mandate," the judge continued.

"Under Virginia's standing theory, a state could acquire standing to challenge any federal law merely by enacting a statute — even an utterly unenforceable one — purporting to prohibit the application of federal law."

Cuccinelli said the court's opinion rejects the role of the states envisioned in the Constitution.

"It is unfortunate that the court would be so dismissive of a piece of legislation that passed both houses of a divided legislature by overwhelming margins with broad, bipartisan support," he said.

The ruling was welcome news for the Justice Department, and for Obama, coming a day before the president's trip to the University of Richmond, where he will discuss his jobs plan.

"We also continue to appreciate the rulings of other courts on the merits upholding the constitutionality of the act," the Justice Department said in a statement. "Throughout history, there have been similar challenges to other landmark legislation such as the Social Security Act, the Civil Rights Act and the Voting Rights Act, and all of those challenges failed as well.

"We will continue to vigorously defend the health-care reform statute in any litigation challenging it, and we believe we will prevail."

Earlier this year, a federal appeals court in Cincinnati upheld the law. But an appeals court in Atlanta struck down the insurance mandate in a lawsuit brought by Florida on behalf of more than two dozen other states. Another appellate challenge to the act is pending in the District of Columbia.

The mixed results of various legal challenges to the health-care act make it likely the issue will be heard by the Supreme Court. If the court takes the case in its next term, it likely would issue a ruling in the spring.

But the nature of the ruling against Virginia — based on standing, not the individual mandate — could work against the possibility that the high court will select the state's case to resolve the constitutional issue in the health-care debate, said University of Richmond law professor Kevin Walsh.

"The Supreme Court could still grant review … but it would probably do so only if it viewed the jurisdictional questions as independently worthy of Supreme Court review," said Walsh, a former clerk for U.S. Supreme Court Justice Antonin Scalia.

He said the states represented in Florida's challenge have advanced standing arguments that do not depend on anti-mandate state laws like the argument rejected by the 4th Circuit in Virginia's case.