Re: Facial vs. As-Applied Challenges to the Individual Mandate

Ilya’s post below addresses an important issue in commerce clause litigation: Whether commerce clause challenges should be treated as facial or as-applied challenges and, if the former, how such challenges should be addressed.  I largely agree with Ilya’s post. Indeed, if anything, Ilya understates the point, particularly with regard to United States v. Lopez. Further, whatever the other merits of Judge Sutton’s opinion — which is quite strong, even if I disagree with its conclusion — it mishandles this issue.

In his post below, Ilya writes:

By Judge Sutton’s reasoning, the Supreme Court should have rejected the facial challenges brought inUnited States v. Lopez and United States v. Morrison. In Lopez, the Court struck down a federal law banning possession of guns in a school zone as going beyond Congress’ authority under the Commerce Clause. But surely some of the people whom that law could have been applied to were using guns that were purchased in interstate commerce or had brought the guns into a school zone in order to facilitate an interstate economic transaction (e.g. — bringing in a gun in order to protect their sale of illegal drugs imported from abroad).

This is not merely a hypothetical. It is, in fact, what happened in Lopez. Alfonso Lopez was not just some kid who happened to bring a gun to school.  Rather, as the Fifth Circuit’s opinion explains, he was a courier who had been paid to deliver the gun to a gang member.  He was a delivery boy engaged in a commercial transaction.   As a consequence, his possession was within the scope of the  Commerce Clause power.  Had Congress passed legislation prohibiting this sort of economic transaction, his Commerce Clause argument would have failed.  The reason his Commerce Clause challenge prevailed was not because his conduct was beyond the scope of the Commerce Power. Rather, it prevailed because the statute at issue (the Gun-Free School Zones Act) was not itself a proper exercise of that power.  What the statute prohibited — possession, as such, in a school zone — was beyond the scope of the power, even though the statute reached conduct that could be reached constitutionally.

What the Court’s handling of Lopez reveals is that the key question in a Commerce Clause challenge is the nature of the exercise of federal power, not whether, in a given case, the plaintiff’s conduct could be regulated or prohibited constitutionally.  This is why the GFSZA was invalidated when challenged by someone who was engaged in reachable conduct.  It is also why the Lopez Court noted the lack of a jurisdictional element (e.g., a provision limiting the prohibition to gun possession “substantially related” to interstate commerce).  The purpose of a jurisdictional element is to preserve a statute’s constitutionally by confining its exercise to those activities within the scope of the Commerce Clause power. (See, e.g., the Supreme Court’s unanimous opinion United States v. Jones.)  Thus, a statute prohibiting the commercial possession of guns in or near a school is constitutional, but a statute imposing a blanket prohibition on gun possession in or near a school is not.  In the former instance Congress is engaged in a constitutional exercise of its power, in the latter it is not, even though the statutes overlap.  Yet under Judge Sutton’s approach, the GFSZA should have been upheld because it would be constitutional to prohibit participation in commercial gun transactions like the one in which Lopez was engaged.

The traditional test for a facial challenge is whether there is any set of circumstances in which the statute’s application would be constitutional.  As Lopez shows, the proper way to apply this test is not to ask whether the statute reaches otherwise reachable conduct — commercial gun possession, the purchase of insurance, etc.  Rather, the question is whether the class of activities expressly subject to regulation — that is, the conduct which brings an individual within the scope of the statute at issue — is itself within the scope of the Commerce power.  As the Supreme Court has reiterated time and again (albeit mostly in cases upholding statutes against Commerce Clause challenge), what matters is what Congress did, not the specific conduct of the individual challenging the statute’s constitutionality.  This is why Lopez prevailed.  Incidentally, it is also why Angel Raich lost.  For in Gonzales v. Raich there was no question that Congress could regulate interstate commerce in drugs.  Once the Court concluded that the class of activities subject to the statute — the sale, production, distribution and possession of a controlled substance — was within the scope of the Commerce power [supplemented by the Necessary & Proper clause], Raich had to lose.  Indeed, there is no Commerce Clause precedent in which the Supreme Court has upheld the broader statute but invalidated its application to a specific individual.  If the relevant statutory provision is a permissible exercise of the Commerce power, the challenge fails.

The above illustrates why the key issue is defining the class of activities subject to federal control.  Listen to the oral arguments in the various Circuit Courts and notice how acting-Solicitor General Neil Katyal takes pains to define the class of activities subject to regulation in economic terms — as “financial decisions about how and when health care is paid for”.   Judge Martin’s decision does much the same, characterizing the class of activities as “the practice of self-insuring for the cost f health care delivery.”  The problem, in my view, is that these characterizations are not consistent with the statutory provision, as neither accurately characterizes the class as a whole Congress has sought to regulate.

It may be the case that most of those subject to the individual mandate are making “financial decisions” about how and when to pay for their health care or are engaged  in self-insurance, but the statute does not limit its application to such people, nor can all those subject to the mandate be characterized in such terms.  Not only are there those who would otherwise never purchase health insurance.  There are also those who, for whatever reason religious or otherwise, will never purchase health care. [See, e.g., Mead v. Holder at p. 6.]  (Indeed, under Cruzan, they have a fundamental right to refuse even potentially life-saving care.)   That Congress can reach most of those without insurance through other means is immaterial, just as it was immaterial that Congress could have prohibited what Alfonso Lopez actually did had it only passed a different statute.  What matters is the statute that Congress actually passed, and whether the class of activities over which Congress asserted its authority is, as a class, subject to federal jurisdiction.

So, contrary to Katyal’s protestations at the various oral arguments and the opinions of Judges Martin and Sutton, the class of activities at issue is the mere presence in the country without qualifying health insurance, and the question really is whether Congress may mandate the purchase of a given good or service.  In other words, the question is whether such a mandate itself is facially constitutional as an exercise of federal power, not whether we can identify a range of situations in which such a mandate could be constitutionally applied. [As-applied challenges should be reserved to claims that the mandate violates some other constitutional provision, such as the First or Fifth Amendment, in its application to specific individuals, e.g. someone with religious objections to medical care.]

[For those interested in more this question, I recommend the work of a former student: Nathaniel Stewart, Turning The Commerce Clause Challenge "On Its Face": Why Federal Commerce Clause Statutes Demand Facial Challenges, 55 Case Western Reserve Law Review 161 (2004).]

POST-SCRIPT: Just in case it was not clear, the argument above is not sufficient to establish the unconstitutionality of the individual mandate. The point is rather to identify some of the problems with the way some of defended its constitutionality. Although I believe the mandate should be held unconstitutional, I have long conceded that this is a difficult case, particularly in light of Gonzales v. Raich, and one that implicates first principles about the nature of federal power and the Constitution.

SECOND POST-SCRIPT: I should also have noted that what this argument does is shift the focus from the Commerce Clause to the Necessary & Proper Clause. If a class of activities extends beyond the scope of the Commerce Clause itself (as I believe the class subject to the mandate does), the question becomes whether the broader class can be justified as Necessary & Proper to the overall scheme. Under Gonzales v. Raich, there is a strong argument in defense of the mandate on these grounds. Short of overturning Raich (which I would love to see the Court do), the strongest counter-arguments are that mandating the purchase of a good or service is not “proper” to the execution of an enumerated power and that the argument for the mandate rests on an effectively unlimited conception of federal power that contravenes one of the motivating principles of Lopez and Morrison.

THIRD POST-SCRIPT: Some of the commenters below suggest my view requires a somewhat-radical “all-or-nothing” approach to Commerce Clause challenges. Yes and no. It is perhaps radical and “all-or-nothing” in that I believe that a given prohibition is either within the scope of enumerated powers or it is not. But what is “all-or-nothing” is a given statutory provision, not a statute in its entirety. This remains strong medicine, but makes my position slightly less radical in its implications. What would this have meant for Gonzales v. Raich? This is a good question, and one I engaged in this article (see pages 770-776). My first preference would have been for the Court to invalidate the prohibition on possession, thereby requiring Congress to add a jurisdictional element. Two alternatives that are less doctrinally satisfying, but perhaps easier to swallow, would have been either to hold that the CSA did not reach non-commercial possession (effectively reading a jurisdictional requirement into the statute), or to have recognized a separate class of activities authorized by state law that could be analyzed independently. Either of these alternatives would have required a bit of work (particularly the latter), as there’s little basis for either in the relevant case law.

NOTE: I’ve cleaned up the original post in a few places to make it a bit more clear.