California District Court Dismisses Anti-Mandate Lawsuit for Lack of Standing

I should have gotten around to this when it happened. But it’s still worth nothing that a federal district court in California dismissed a lawsuit challenging the Obama health care plan’s individual mandate on the grounds that the plaintiffs lacked standing. The case was brought by former California state legislator Steve Baldwin and the Pacific Justice Institute.

I. The Ruling and Its Likely Impact.

This decision is at odds with rulings by district courts in Virginia, Michigan, and Florida, all of which concluded that a variety of plaintiffs challenging the mandate – state governments, individuals, employers, and the National Federation of Independent Business – do indeed have standing.

Judge Dana Sabraw’s decision relies on the types of standing arguments that I discussed in this post. The key point, as Sabraw sees it, is that the mandate doesn’t go in to effect until 2014, and it is not certain that the plaintiffs won’t obtain the required health insurance before that time. Therefore, he concludes that they haven’t suffered an “injury in fact” of the kind required by the the Supreme Court’s current standing doctrine.

The plaintiffs have appealed the ruling to the Ninth Circuit Court of Appeals, and (more unusually) have tried to get the Supreme Court to hear the issue even before the Court of Appeals does. For reasons discussed by Brad Joondeph and Lyle Denniston, I think the latter gambit will almost certainly fail.

On the other hand, it is quite possible that the Ninth Circuit will reverse the District Court’s standing ruling. Until recently, liberal judges tended to take a much more permissive approach to standing than conservative ones, and the Ninth Circuit – the most liberal in the country – followed that trend. If judges of differing ideologies found that standing doctrine in the much more conservative Fourth (the Virginia case), Sixth (Michigan), and Eleventh (Florida) circuits gives the plaintiffs standing before 2014, I suspect the same result should hold true in the Ninth.

If the Ninth Circuit does uphold the district court’s standing ruling, that might ironically benefit the anti-mandate cause. As the most liberal circuit court in the country, the Ninth Circuit is the least likely to rule that the mandate is unconstitutional. A victory on standing for the plaintiffs in this case is likely to be followed by defeat on the merits. By contrast, the plaintiffs have a much better chance in the generally conservative Fourth and Eleventh circuits, or even in the closely divided Sixth.

As with most of the other major issues in the case, the standing question is likely to be eventually decided by the Supreme Court. My tentative guess is that the Court will rule that at least some of the plaintiffs do have standing. That is particularly likely in the case of the state government plaintiffs, since the Court recently adopted extremely permissive standing requirements for state plaintiffs in Massachusetts v. EPA.

II. Judge Sabraw’s Analysis of Standing.

Judge Sabraw could have rested his ruling on the ground that it’s not clear from the record whether Baldwin actually has health insurance or not, or whether the Pacific Justice Center provides health insurance to its employees that meet the standards required by the health care bill. I find it remarkable that Baldwin and the PJC didn’t make this clear in their pleadings; but I assume that Judge Sabraw is correct in saying that they didn’t. In any event, the judge concludes that they don’t have standing regardless of this: “even if [Baldwin] does not have insurance at this time, he may well satisfy the minimum coverage provision of the Act by 2014: he may take a job that offers health insurance, or qualify for Medicaid or Medicare, or he may choose to purchase health insurance before the effective date of the Act.”

In effect, Sabraw seems to suggest that the plaintiffs would only have standing if the relevant injury were certain to occur, or almost so. In support of this conclusion, he cites precedent holding that a future injury is enough to satisfy standing requirements if the plaintiff “is immediately in danger of sustaining some direct injury as the result of the challenged official conduct.” But this language says nothing about how certain the injury is, only about when it occurs and how “direct” it is. If there is going to be an injury at all, it will clearly be directly caused by the individual mandate requirement. And as the Florida decision makes clear (pp. 32-38), there is plenty of precedent supporting the notion that a forty month time frame isn’t too long. A Ninth Circuit precedent cited in the opinion says that standing is satisfied by a “threatened or actual injury.” It seems to me that a “threatened” injury need not be certain to occur. The Supreme Court has several times granted standing in cases dealing with merely probablistic injuries, such as Friends of the Earth v. Laidlaw, and Massachusetts v. EPA.

In sum, I think it’s possible that these plaintiffs really don’t have standing under current doctrine, because, according to Judge Sabraw’s opinion, they have not proved that they don’t already have the required insurance. But the judge’s reasons for denying standing go far beyond this narrow conclusion. I’m not an expert on Ninth Circuit standing doctrine by any means. So it’s possible that there is a relevant circuit court decision that I’m missing. If so, Judge Sabraw apparently missed it as well.

Finally, I should note that I am generally skeptical of the view that the Constitution imposes tight standing requirements. Supreme Court precedent has been moving in my direction in recent years, but there is still a substantial gap between my view and the Court’s. Even so, I doubt that the broad standing ruling made by the California district court will survive on appeal.