Liberty University v. Lew, 13-306
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Transcript of Liberty University v. Lew, 13-306
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No. 13-306
IN THE SUPREME COURT OF THEUNITED STATES
LIBERTY UNIVERSITY, MICHELE G. WADDELL and JOANNE V. MERRILL,
Petitioners. v .
JACOB J. LEW, KATHLEEN SEBELIUS,SETH D. HARRIS, ERIC H. HOLDER, Jr.,
Respondents. ___________________________________________
On Petition for Writ of Certiorari to theUnited States Court of Appeals for the
Fourth Circuit _________________________________________
PETITION ERS BRIEF IN REPLY ____________________________________________Mathew D. Staver(Counsel of Record)
Anita L. StaverHoratio G. MihetLiberty Counsel1055 Maitland CenterCommons, 2d FloorMaitland, FL 32751(800) [email protected]
Stephen M. CramptonMary E. McAlisterLiberty CounselPO Box 11108Lynchburg, VA 24506(434) [email protected]
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected] -
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TABLE OF CONTENTS
TABLE OF CONTENTS .................................. i
TABLE OF AUTHORITIES ......................... iii
INTRODUCTION ............................................ 1
REASONS FOR GRANTING THEPETITION ......................................................... 3
I. THIS IS THE ONLY CASE WHICHPRESENTS THE FULL ARRAY OFCONSTITUTIONAL QUESTIONSLEFT UNANSWERED BY NFIB . ..... 3
II. SIGNIFICANT CONSTITUTIONALQUESTIONS RELATED TO THEPREVENTIVE CARE MANDATE
ARE SQUARELY PRESENTED INTHIS CASE. .......................................... 5
A. The Preventive CareMandate Was Part Of TheEmployer Mandate At TheTime Of Remand. ................. 5
B. This Is The Only Case That Addresses The Religious
Liberties Of Non-ProfitEmployers. ............................ 6
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III. THE TAXING AND SPENDINGISSUES POSED BY THEEMPLOYER MANDATE ARESIGNIFICANTLY DIFFERENTFROM THOSE IN THEINDIVIDUAL MANDATE ANDREQUIRE THIS COURTS REVIEW ................................................ 7
IV. THIS CASE PERMITS A HOLISTIC
REVIEW OF THE RELIGIOUSLIBERTY ISSUES POSED BY THEINSURANCE MANDATES. ............. 10
V. THE FOURTH CIRCUITS FINDINGTHAT THE EMPLOYER MANDATECOMPORTS WITH CONGRESSCOMMERCE CLAUSE POWERCONFLICTS WITH NFIB. ............... 13
VI. THERE ARE NO JURISDICTIONALBARRIERS TO THIS COURTSREVIEW. ............................................. 14
CONCLUSION ................................................. 6
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TABLE OF AUTHORITIES
Cases
Autocam Corp. v. Sebelius ,2013 WL 5182544 (6th Cir. 2013) ................ 16
Autocam Corp. v. Sebelius , petition for cert.pending, No. 13-482 .................................... 1, 9
Bailey v. Drexel Furniture Co. ,
259 U.S. 20 (1922) ........................................... 7Conestoga Wood Specialties Corp. v. Sebelius ,
petition for cert. pending, No. 13-356 ........ 1, 9
Conestoga Wood Specialties v. Secretary , 724F.3d 377 (3d Cir. 2013) ................................. 16
Henderson v. United States, 133 S. Ct. 1121 (2013) ..................................... 5
Hobby Lobby v. Sebelius ,723 F. 3d 1114 (10th Cir. 2013) ................... 16
Liberty University v. Lew ,2013 WL 3470532 (4th Cir. 2013) ............... 15
Lujan v. Defenders of Wildlife ,504 U.S. 555 (1992) ....................................... 16
Natl Treasury Employees Union v. Von Raab ,489 U.S. 656 (1989) ...................................... 5-6
NFIB v. Sebelius,132 S.Ct. 2566 (2012) ............... 1, 3, 7, 9, 13-14
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Sebelius v. Hobby Lobby Stores, Inc ., petitionfor cert. pending, No. 13-354 .................. 1, 7, 9
Thorpe v. Housing Authority ,393 U.S. 2683 (1969) ....................................... 5
Virginia v. Am. Booksellers Assn. ,484 U.S. 383 (1988) ....................................... 16
Statutes
26 U.S.C. 4980D .......................................... 8-1026 U.S.C. 4980H ............................................... 9
26 U.S.C. 5000A ............................................... 9
26 U.S.C. 9815 .................................................. 8
26 U.S.C. 9834 .................................................. 8
29 U.S.C. 1132 ................................................ 10
29 U.S.C. 1185d ................................................ 842 U.S.C. 18023(b) .................................... 11-12
42 U.S.C. 300gg-22 ................................. 6, 8, 10
Other Authorities
H.R. 3279 IH 113th Congress (1st SessionOctober 9, 2013 ............................................. 12
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http://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-benefits-exchange-plans-draws-objections.ece .................................................................. 11-12
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INTRODUCTION
Unlike the other Petitions pending beforethis Court, this case provides a single vehicle toresolve the constitutional questions related tothe Patient Protection and Affordable Care Act(the Act) which remain unanswered after thisCourts decision in NFIB v. Sebelius, 132 S.Ct.2566 (2012). Petiti oners challenge includes thereligious liberty issues posed by regulationsrequiring that employer-provided healthinsurance include no-cost coverage ofcontraceptives and abortifacients, the religiousliberty issues posed by requiring individuals topay for abortions, and the overarchingconstitutional questions raised by mandatingthat employers provide health insurance or facecrippling penalties.
The challenges raised in Sebelius v.
Hobby Lobby Stores, Inc ., petition for cert.pending, No. 13-354, Conestoga WoodSpecialties Corp. v. Sebelius , petition for cert.pending, No. 13-356, and Autocam Corp. v.Sebelius , petition for cert. pending, No. 13-482,address one aspect of the Employer Mandate,i.e. , the requirement for no-cost contraceptiveand abortifacient coverage. Liberty University s petition includes the issue presented by theforegoing, but also addresses whether Congress
has authority to pass the Employer Mandate.This case also addresses issues related to theIndividual Mandate left unanswered in NFIB ,
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i.e., whether, even if it is considered a valid tax,it violates religious liberty encompassed in theFirst Amendment and the Religious FreedomRestoration Act (RFRA).
The Administration raises rejected claimsrelated to standing and application of the Anti-Injunction Act (AIA) , but offers no basis foroverturning the Fourth Circuits jurisdictionaldecisions that comport with this Courtsprecedents. In contrast to its jurisdictionalrulings, the Fourth Circuits substantiverulings conflict with this Courts precedents,including NFIB , and with cases in othercircuits. The Administration fails to recognizesignificant differences between the EmployerMandate and the Individual Mandate thataffect the constitutional arguments, andthereby fails to appreciate the extent of theconflict between t he Fourth Circuits decisionand this Court s precedents.
That conflict is also apparent in theFourth Circuits rejection of the religiousliberties challenges to the Employer andIndividual Mandates. The lower court failed toaddress the mandates as they existed at thetime of its review on remand, which includedthe final definitions of essential healthbenefits to include contraceptives andabortifacients that violate Petitioners sincerely
held religious beliefs. Because of the extent ofthe constitutional challenges presented in thiscase and the depth of the conflict between the
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Fourth Circuits decision and this Courtsprecedents on foundational constitutionalissues, this Court should grant the Petition.
REASONS FOR GRANTING THEPETITION
I. THIS IS THE ONLY CASE WHICHPRESENTS THE FULL ARRAY OFCONSTITUTIONAL QUESTIONS
LEFT UNANSWERED BY NFIB .Before reaching the question of whether
the Administration can compel religiously-based employers to provide no-cost coverage forcontraceptives and abortif acientsthe issueaddressed in Hobby Lobby , Conestoga Wood, and Autocam this Court should consider themore foundational question of whetherCongress can constitutionally compelemployers to provide health insurance or faceexcessive penalties. That question is presentedsquarely and solely in this case, making thisthe proper vehicle for this Courts considerationof the constitutional questions left unansweredby NFIB .
In NFIB, this Court answered thequestion of whether the Individual Mandatecomports w ith Congress enumerated powers ,but did not review the Employer Mandate.NFIB , 132 S.Ct. at 2585-2594. As was true withthe Individual Mandate, the question ofwhether Congress had the authority to enact
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the Employer Mandate is of paramountimportance in determining whether and towhat extent the Administration can implementthe Act. In light of the devastating penaltiesassessed against employers under theEmployer Mandate, the constitutional validityof the directive must be analyzed precisely andconsis tently with this Courts precedents.Precise analysis is all the more critical in lightof the significant religious liberty issues posedby regulations that define the insuranceobligation placed upon employers to includefree contraceptives and abortifacients aspreventive care.
Those religious liberty issues are relevantonly if this Court determines that the EmployerMandate is a valid exercise of Congressenumerated powers. If the mandate is found toexceed Congress power, then it and theconcomitant preventive care regulations areinvalid and would no longer threaten religiousliberty. Only if the Court finds that themandate is a val id exercise of Congress powerwould the validity of the preventive careregulations and the religious liberty issues theypose become critical.
That being the case, this Court shouldgrant the Petition and undertake analysis ofthe constitutionality of the Employer Mandate
upon which resolution of the questionspresented in Hobby Lobby, Conestoga Wood and Autocam hinges. Granting review of this case
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will also resolve remaining questions related tothe Individual Mandate, i.e., whether thedirective violates religious liberty guaranteedunder the First Amendment and RFRA. Forthese reasons, this is the ideal vehicle for thisCourts review.
II. SIGNIFICANT CONSTITUTIONALQUESTIONS RELATED TO THEPREVENTIVE CARE MANDATE ARE
SQUARELY PRESENTED IN THISCASE.
A. The Preventive CareMandate Was Part Of TheEmployer Mandate At TheTime Of Remand.
When, as occurred in this case, a statuteis amended or clarified through implementingregulations during the pendency of an appeal,the court of appeals is required to analyze thelaw as it exists at the time of appellate review.Thorpe v. Housing Authority , 393 U.S. 268,281-83 (1969) Nat l Treasury Employees Unionv. Von Raab , 489 U.S. 656, 661 n. 1 (1989);Henderson v. United States, 133 S. Ct. 1121,1129, (2013).
On remand the Fourth Circuit wasrequired to analyze Petitioners religious liberty
challenges to the Employer Mandate in light ofits requirement that employers providecontraceptives and abortifacients at no cost, see
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42 U.S.C. 18022(a); 42 U.S.C. 300gg-13. VonRaab , 489 U.S. at 661. The preventive careregulations were not new issues raised for thefirst time on appeal, but were part of theEmployer Mandate as it existed at the time ofthe Fourth Circuits review. A ny analysis of theconstitutionality of the mandate could not becomplete without considering the effect ofrequiring employers to provide contraceptivesand abortifacients at no cost. Since the FourthCircuit refused to do so, its decision conflictswith established precedent and should bereviewed.
B. This Is The Only CaseThat Addresses TheReligious Liberties OfNon-Profit Employers.
This Courts analysis of the constitutionalvalidity of the Employer Mandate will also beincomplete without consideration of howrequiring free contraceptives and abortifacientswill affect the religious liberty interests of non-profit employers such as Liberty University.The other cases pending before this Court,Hobby Lobby, Conestoga Wood and Autocam ,involve for-profit employers challenging thepreventive care regulations in the EmployerMandate. The Administration argues that the
for-profit nature of those businesses raiseunique religious liberty questions. HobbyLobby, Case No. 13-354, Petition for Writ of
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Certiorari at 16-32. The question of whetherfor-profit enterprises can assert religiousliberty claims is a primary question in thosecases. Id. Therefore accepting review of onlythose cases will necessarily result in anincomplete analysis of the constitutionality ofthe preventive care regulations within theEmployer Mandate.
By contrast, granting review of this casewill ensure a more complete analysis of thereligious liberty issues posed by the EmployerMandate.
III. THE TAXING AND SPENDINGISSUES POSED BY THE EMPLOYERMANDATE ARE SIGNIFICANTLYDIFFERENT FROM THOSE IN THEINDIVIDUAL MANDATE ANDREQUIRE THIS COURTS REVIEW. Unlike the single financial penalty under
the Individual Mandate that this Court foundto be small in comparison to the cost of healthinsurance, and therefore a permissible tax,NFIB , 132 S.Ct. at 2594, the multiple andpotentially crippling levels of fines under theEmployer Mandate are impermissible penaltiesunder Bailey v. Drexel Furniture Co. , 259 U.S.20 (1922). As the Administration explains inHobby Lobby, Conestoga Wood and Autocam,
but fails to mention in this case, the penaltiesimposed under the Employer Mandate extendbeyond an in- lieu tax for not having insurance
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to multi-level penalties enforced by variousadministrative agencies. 1
1 In Hobby Lobby , Conestoga Wood and Autocam, the Administration explains that thepreventive care regulations apply toemployment-based group health plans coveredby ERISA and therefore will be subject toERISAs enforcement mechanisms under 29USC 1185d.
It is also enforceable throughimposition of tax penalties on theemployers that sponsor such plans.26 U.S.C. 4980D; see 26 USC9815(a)(1), 9834 (Supp. 2011).With respect to health insurers inthe individual and group markets,States may enforce the Acts
insurance market reforms,including the preventive-servicescoverage requirement. 42 USC300gg-22(a)(1) (Supp. 2011). If theSecretary of Health and HumanServices determines that a Statehas failed to substantially enforceone of the insurance marketreforms with respect to suchinsurers, she conducts such
enforcement herself and mayimpose civil penalties. 42 U.S.C.300gg-22(a)(2) (Supp. 2011); see
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Employers which do not provide healthinsurance are assessed a penalty of $2,000 peremployee per year under 26 U.S.C. 4980H.This penalty, standing alone, might arguablybe comparable to the in- lieu tax assessedagainst individuals under 26 U.S.C. 5000A,NFIB , 132 S.Ct. at 2594. However, thepenalties under the Employer Mandate gomuch farther. Even employers who providehealth insurance could face fines of $3,000 peremployee per year if the coverage does notsatisfy the Administrations definitions ofminimum coverage and maximum value . 26U.S.C. 4980H. More importantly, employersface penalties of $100 to as much as $15,000per employee per day under 26 U.S.C. 4980Dif the insurance provided fails to meet the
Administrations standards. 2 Those penalties, along with other fines,
are not only administered by the IRS, but alsothe Departments of Labor and Health and
42 U.S.C. 300gg-22(b)(1)(A) (Supp.2011); 42 U.S.C. 300gg-22(b)(2).
Hobby Lobby, No. 13-354, Petition for Writ ofCertiorari, at 3 n. 3; Conestoga Wood , No. 13-356, Brief in Response at 3 n.3; Autocam, No.13-482, Brief in Response, at 3 n.3.2 The Administration failed to include Section4980D and the other provisions listed infootnote 1 in its Response in this case.
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Human Services. 29 U.S.C. 1132(a)(5), 42U.S.C. 300gg-22. 3 In addition, daily penaltiesare increased if non-compliance occurs after anotic e of deficiency or is deemed more than deminmis, creating a scienter factor. 26 U.S.C.4980D(b)(3).
The exorbitant fines, scienter provisionand multi-departmental enforcement in theEmployer Mandate differentiate it from theIndividual Mandate and place the EmployerMandate squarely in the definition of animpermissible penalty under Drexel Furniture.The Fourth Circuits contrary conclusionconflicts with Drexel Furniture and with NFIB and should be reviewed by this Court.
IV. THIS CASE PERMITS A HOLISTICREVIEW OF THE RELIGIOUSLIBERTY ISSUES POSED BY THEINSURANCE MANDATES .This is the only case that provides this
Court with the opportunity to fully address thethreats to religious liberty posed by the Act.Those threats go beyond the preventive care regulations within the Employer Mandateaddressed in Hobby Lobby , Conestoga Wood ,
Autocam and this case to include subsidizationof surgical abortions under both the employerand individual mandates and individualized
3 See footnote 1.
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exemptions favoring certain believers. As theonly case that raises all of those religiousliberty issues, this is the only vehicle that offersthis Court the opportunity to preserveindividuals and employers religious libertiesagainst the full array of threats posed by thehealthcare law.
Among those threats is a requirementthat enrollees in health insurance exchangeplans make separate payments to be usedexclusively for surgical abortions. 42 U.S.C.18023(b). The Fourth Circuit and the
Administration dismissively claim that there isno burden upon Petitioners religious beliefsbecause employers and individuals can simplychoose policies without abortion coverage.(Appx. 61a n.9, Brief in Response, p. 19).However, neither employers nor individualsnecessarily have that option. The Act providesthat states may, but are not required to, enactlaws prohibiting abortion coverage in healthinsurance exchange plans. 42 U.S.C. 18023(a).Employers and individuals in states whichhave not enacted such laws will not necessarilybe able to choose a plan that excludes abortioncoverage. Id. 4 Therefore, they will be compelled
4 For example, in Rhode Islands healthinsurance exchange, there are no plans that
exclude coverage for abortions.http://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-
http://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-benefits-exchange-plans-draws-objections.ecehttp://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-benefits-exchange-plans-draws-objections.ecehttp://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-benefits-exchange-plans-draws-objections.ecehttp://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-benefits-exchange-plans-draws-objections.ece -
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to pay the separate premiums for abortioncoverage in violation of their religious beliefs.Section 18023 does not provide any exemptionsfrom the abortion premium payments. Id.
The Administration also claims thatPetitioners religious rights are not burdenedbecause insurers must provide notice ofabortion coverage. (Brief in Response, p. 19).However, insurers need only mention abortioncoverage at initial enrollment and even then,need only state the total premium price, not theseparate abortion payment. 45 CFR 156.280.Consequently, Petitioners and others whosereligious beliefs proscribe paying for abortionswill be unable to ensure that their rights areprotected. Notably, some members of Congresshave recognized the danger posed by the lack ofappropriate notice and have introducedlegislation to provide the clear notice thatreligious adherents need to avoid violatingtheir religious beliefs. 5
The Administrations selective exemptionof certain religious sects and members of healthcare sharing ministries from the IndividualMandate and selective exemption andaccommodation of certain religiously based
benefits-exchange-plans-draws-objections.ece (last visited October 30, 2013).5 H.R. 3279 IH 113th Congress (1st SessionOctober 9, 2013).
http://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-benefits-exchange-plans-draws-objections.ecehttp://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-benefits-exchange-plans-draws-objections.ecehttp://www.providencejournal.com/news/health/20130622-abortion-coverage-in-all-r.i.-health-benefits-exchange-plans-draws-objections.ece -
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employers from the Employer Mandate alsopose significant religious liberty concerns whichshould be resolved by granting PetitionersPetition. This case is the only vehicle whichprovides the Court with the opportunity toaddress the myriad threats to religious libertypresent throughout the Act. Consequently, thisCourt should grant review.
V. THE FOURTH CIRCUITS FINDING
THAT THE EMPLOYER MANDATECOMPORTS WITH CONGRESSCOMMERCE CLAUSE POWERCONFLICTS WITH NFIB.Nothing about the Employer Mandate
justifies the Fourth Circuits deviation fromthis Courts conc lusion that CongressCommerce Clause authority does not extend tocompelling a party to enter into commercialactivity. NFIB , 132 S.Ct. at 2587. As was truewith the Individual Mandate, the EmployerMandate authorizes Congress to use itscommerce power to compel citizens to act as theGovernment would have them act inderogation of the intent of the CommerceClause. Id. at 2589.
The Employer Mandate is not merely alogical extension of existing laws regulatingemployers who voluntarily provide and can
discontinue providing employee benefits.Instead, it is an unprecedented regulation thatcompels all employers with fifty or more
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employees to provide government-definedbenefits at government-defined prices with nopossibility of exiting save going out of business.Congressional regulation of voluntarymarketplace participation does not authorizeCongress to direct employers to purchaseparticular products any more than regulation ofhealth insurance authorizes Congress to compelindividuals to enter the market. Id. at 2590-2591. The Commerce Clause is not a generallicense to regulate an individual from cradle tograve, simply because he will predictablyengage in particular transactions. Id. Neitheris it a general license to regulate employers,and the Fourth Circuits contrary conclusionshould be reviewed by this Court.
VI. THERE ARE NO JURISDICTIONALBARRIERS TO THIS COURTSREVIEW.The Administration attempts to erect
jurisdictional barriers to this Courts review,but offers no justification for overturning theFourth Circuits conclusions, consistent withNFIB , that Petitioners have standing and the
AIA is not applicable. The Fourth Circuits AIAruling is also consistent with the lower courtsrulings in Hobby Lobby, Conestoga Wood and
Autocam .
There is no basis for review of the FourthCircuits conclusion that the employermandate exaction, like the individual mandate
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exaction, does not constitute a tax for purposesof the AIA , so that the AIA does not bar thissuit. Liberty University v. Lew , 2013 WL3470532 at *6 (4th Cir. 2013). As the FourthCircuit said:
To adopt the Secretarys positionwould lead to an anomalous result.The Supreme Court has expresslyheld that a person subject to theindividual mandate can bring apre-enforcement suit challengingthat provision. But, under theSecretarys theory, an employersubject to the employer mandatecould bring only a post-enforcementsuit challenging that provision. Itseems highly unlikely thatCongress meant to signal withtwo isolated references to the termtax that the mandates should betreated differently for purposes ofthe AIAs applicability. Tellingly,the Government has pointed to norationale supporting suchdifferential treatment.
Id. The same is true here. The Administrationoffers no rationale for this Court to review the
Fourth Circuits finding that is consistent withNFIB.
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Furthermore, the Fourth Circuits rulingis consistent with the lower court rulings inHobby Lobby, Conestoga Wood and Autocam ,in which the Tenth, Third and Sixth circuits,respectively, agreed that the AIA did not barthe challenges to the Employer Mandatespreventive care regulations. Hobby Lobby v.Sebelius , 723 F. 3d 1114, 1126-1127 (10th Cir.2013); Conestoga Wood Specialties v. Secretary ,724 F.3d 377, 396 n.9 (3d Cir. 2013) (Jordan, J.dissenting); Autocam Corp. v. Sebelius , 2013WL 5182544 at *3 (6th Cir. 2013). Notably, ineach case, the Administration had stipulatedthat the AIA did not apply. Hobby Lobby, 723F. 3d at 1126; Conestoga Wood , 724 F.3d at396; Autocam, 2013 WL 5182544 at *3.
There is also no basis for review of theFourth Circuits conclusion that Petitionershave standing. The Fourth Circuit correctlyfollowed this Courts precedents in Lujan v.
Defenders of Wildlife , 504 U.S. 555, 561 (1992)and Virginia v. Am. Booksellers Assn. , 484 U.S.383, 392 93 (1988) to find that Petitioners havestanding. The Administration offers noauthority to the contrary.
CONCLUSIONThis is the only case pending before this
Court which addresses the fully array of
unresolved issues related to the healthcare law.Because of the unique scope of issues presentedby this case and the conflicts between the
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Fourth Circuits conclusions and establishedprecedent, this Court should grant the Petition.
November 2013
Mathew D. Staver(Counsel of Record)
Anita L. StaverHoratio G. MihetL IBERTY COUNSEL 1055 Maitland CenterCommons, 2d FloorMaitland, FL 32751(800) [email protected]
Stephen M. CramptonMary E. McAlisterL IBERTY COUNSEL PO Box 11108Lynchburg, VA 24506(434) [email protected]
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]