{"id":16,"date":"2012-03-05T09:56:51","date_gmt":"2012-03-05T14:56:51","guid":{"rendered":"http:\/\/blog.law.cornell.edu\/healthcarecases\/?page_id=16"},"modified":"2012-03-12T23:07:32","modified_gmt":"2012-03-13T04:07:32","slug":"tax-anti-injunction-act","status":"publish","type":"page","link":"https:\/\/blog.law.cornell.edu\/healthcarecases\/tax-anti-injunction-act\/","title":{"rendered":"(Tax) Anti-Injunction Act Backgrounder"},"content":{"rendered":"

One important question that the Supreme Court will likely address is whether the Anti-Injunction Act<\/a> (\u201cAIA\u201d) bars challenges against the Patient Protection and Affordable Care Act<\/a>\u2019s (\u201cPPACA\u201d) minimum health coverage requirement (the \u201cindividual mandate\u201d). See<\/strong><\/em> Dep\u2019t of Health & Human Serv. v. Florida<\/strong><\/em><\/a>, 181 L. Ed. 2d 420 (U.S. Nov. 14, 2011).<\/strong> This issue went largely unnoticed until the United States Court of Appeals for the Fourth Circuit<\/a> ruled that the AIA applies to a challenge to the individual mandate\u2019s penalty, and, therefore, that courts lack jurisdiction<\/a> to hear challenges to the penalty. See Liberty Univ. v. Geithner<\/a><\/strong><\/em>, No. 6:10-CV-00015 (4th Cir. Sept. 8, 2011).<\/strong> Somewhat unexpectedly, the AIA has the potential to alter the course of the health care litigation; if found to be applicable, the AIA may block all <\/em>suits, both private and public, brought against the individual mandate, because courts may be deemed to lack subject matter jurisdiction<\/a> until the mandate\u2019s penalty is actually assessed against a party. See <\/strong><\/em>Brad Joondeph, <\/strong>The Anti-Injunction Act Complications<\/strong><\/em><\/a>, Health Reform Watch, Sept. 12, 2011; <\/strong>see also Liberty Univ. v. Geithner<\/a><\/strong><\/em>, No. 6:10-CV-00015 (4th Cir. Sept. 8, 2011).<\/strong><\/p>\n

The Anti-Injunction Act<\/em><\/p>\n

The AIA, with a few exceptions, forbids courts to entertain pre-enforcement suits brought with the purpose of \u201crestraining the assessment or collection of any tax.\u201d 26 U.S.C. \u00a7 7421<\/strong><\/a>. (The AIA in this context refers to the Tax <\/em>Anti-Injunction Act, which should not be confused with another statute of the same name\u2014the Anti-Injunction Act<\/a> enacted as Section 5 of the Judiciary Act of 1793<\/a>.) The AIA came into full force in 1962. See Enochs v. Williams Packing & Navigation Co.<\/a><\/strong><\/em>, 370 U.S. 1 (1962)<\/strong>. Early case law relating to the AIA addressed speedy tax assessment<\/a> and collection. See <\/strong><\/em>Brief of Court-Appointed Amicus Curiae<\/strong><\/a> in Support of Vacatur at 5 (citing <\/strong>Bob Jones Univ. v. Simon<\/strong><\/em><\/a>, 416 U.S. 725, 736 (1974))<\/strong>. The Supreme Court has since concluded that the term \u201ctax\u201d in the AIA should be read broadly, in order to facilitate the AIA\u2019s purpose and to avoid a flood of time-consuming pre-enforcement suits. See id<\/a>.<\/strong><\/em> at 7\u20138; <\/strong>see also <\/strong><\/em>Brief of Court-Appointed Amicus Curiae<\/strong><\/a> at 37.<\/strong><\/p>\n

Health Care Implications<\/em><\/p>\n

The PPACA implicates the AIA from a procedural standpoint; although no party raised the AIA in its arguments, the Supreme Court has instructed the parties to brief the question of whether the underlying suit challenging the PPACA\u2019s minimum coverage penalty is barred by the AIA. See <\/strong><\/em>Brief of Court-Appointed Amicus Curiae<\/strong><\/a> at 9<\/strong>. The arguments being circulated relate to the AIA\u2019s applicability, from both substantive and procedural perspectives.<\/p>\n

Certain Amici Curiae<\/a> maintain the notion\u2014allegedly backed by Supreme Court precedent\u2014that the AIA is jurisdictional, as it removes jurisdiction from courts that are anticipating suits challenging tax assessment or collection. See id<\/a>. <\/strong><\/em>at 17\u201318<\/strong>. These Amici contend that the AIA primarily governs a court\u2019s \u201cadjudicatory capacity\u201d and has a primarily jurisdictional purpose. See id<\/a>. <\/strong><\/em>at 19\u201322<\/strong>. Others contest this jurisdictional point, arguing that the AIA does not speak to jurisdiction. See <\/strong><\/em>Brief in Response for Private Respondents<\/strong><\/a> at 16\u201317<\/strong>. Notwithstanding Supreme Court \u201cpassing\u201d references to the contrary, these parties contend that the Court is often reckless in its categorization of \u201cjurisdictional\u201d matters, and that precedent demonstrates that the Court does not treat the AIA as a jurisdictional statute. See id.<\/a><\/strong><\/em> at 17\u201318. <\/strong>Because the AIA is non-jurisdictional, they contend, the government\u2019s position that the AIA does not bar pre-enforcement challenges to the minimum coverage provision has implicitly waived any arguments under the AIA. See id.<\/a><\/strong><\/em> at 18<\/strong>.<\/p>\n

Some parties have argued that Congress intended for the individual mandate to be executed in the same manner as the tax code. See <\/strong><\/em>Brief of Court-Appointed Amicus Curiae<\/strong><\/a> at 23\u201324<\/strong>. It follows, they argue, that the AIA, which specifically addresses \u201ctaxes,\u201d should enjoin any judicial challenges brought against the mandate. See id.<\/a><\/strong><\/em> at 24\u201326; <\/strong>see also <\/strong><\/em>Brief of Amici Curiae Mortimer Caplin and Sheldon Cohen<\/strong><\/a> in Support of Neither Side at 13\u201314.<\/strong> As a corollary, the parties argue that judicial review<\/a> should only be allowed after <\/em>a penalty has been levied. See <\/strong><\/em>Brief of Court-Appointed Amicus Curiae<\/strong><\/a> at 27\u201329<\/strong>. Amici also argue that the term \u201ctax,\u201d as used in the AIA, encompasses the mandate because certain statutory provisions define the term \u201ctax\u201d to include \u201cassessable penalties.\u201d See id.<\/a><\/strong><\/em> at 36\u201339<\/strong>. The Fourth Circuit agrees, noting that the term \u201ctax,\u201d as used in the AIA, should reach any <\/em>statutory assessment of exactions by the Internal Revenue Service<\/a>. See Liberty Univ. v. Geithner<\/a><\/strong><\/em>, No. 6:10-CV-00015 (4th Cir. Sept. 8, 2011).<\/strong> It is further contended that, should the mandate be excluded from the explicit meaning of \u201ctax,\u201d it should still fall within the purview of the AIA, as the Supreme Court has previously extended the AIA\u2019s jurisdiction to include other tax-like provisions. See <\/strong><\/em>Brief of Court-Appointed Amicus Curiae<\/strong><\/a> at 42\u201343.<\/strong> Several courts of appeal have reached the opposite conclusion, however, deciding that the mandate specifically imposes a \u201cpenalty,\u201d not a tax, and should not be treated as a tax for purposes of the AIA. See, e.g.<\/strong><\/em>, <\/strong>Seven-Sky v. Holder<\/strong><\/em><\/a>, No. 1:10-cv-00950 (D.C. Cir. Nov. 8, 2011)<\/strong>.<\/p>\n

The Supreme Court may ultimately decide that it does not have jurisdiction to decide the constitutionality of the individual mandate. See <\/strong><\/em>Kevin C. Walsh, <\/strong>Congress can and Should Enact a Statutory Fix for the Tax Anti-Injunction Act Defect in the Private-Party Constitutional Challenges to the Individual Mandate<\/strong><\/em><\/a>, Walshslaw, Sept. 9, 2011. <\/strong>However, one commentator has proposed a solution consistent with the bipartisan call for a timely decision on the merits by suggesting a legislative overturning of the AIA. See id.<\/a><\/strong><\/em><\/p>\n

Closing Remarks<\/em><\/p>\n

Several other points of contention remain unresolved. First, it is unclear what the government\u2019s plan of attack will be as the case unravels, as its argumentative positions have been fluctuating between fighting on the merits and arguing lack of jurisdiction. See <\/strong><\/em>Brad Joondeph, <\/strong>The Anti-Injunction Act Complications<\/strong><\/em><\/a>, Health Reform Watch, Sept. 12, 2011<\/strong>. Second, though private parties may be barred from action until the first penalties are assessed, state actors\u2014provided they can survive other jurisdictional hurdles\u2014may be able to circumvent the AIA and obtain more immediate relief; however, there are strong arguments against state circumvention. See id.<\/a><\/strong><\/em>; <\/strong>see also <\/strong><\/em>Brief of Court-Appointed Amicus Curiae<\/strong><\/a> at 48\u201349<\/strong>. Finally, it remains to be seen how the Supreme Court will categorize the individual mandate (i.e.<\/em> as a tax or penalty), a decision will impact the force of the AIA argument.<\/p>\n

Prepared by: Milson Yu<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

One important question that the Supreme Court will likely address is whether the Anti-Injunction Act (\u201cAIA\u201d) bars challenges against the Patient Protection and Affordable Care Act\u2019s (\u201cPPACA\u201d) minimum health coverage requirement (the \u201cindividual mandate\u201d). See Dep\u2019t of Health & Human Serv. v. Florida, 181 L. Ed. 2d 420 (U.S. Nov. 14, 2011). This issue went […]<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"open","ping_status":"open","template":"","meta":[],"categories":[6062],"_links":{"self":[{"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/pages\/16"}],"collection":[{"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/comments?post=16"}],"version-history":[{"count":11,"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/pages\/16\/revisions"}],"predecessor-version":[{"id":85,"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/pages\/16\/revisions\/85"}],"wp:attachment":[{"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/media?parent=16"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.law.cornell.edu\/healthcarecases\/wp-json\/wp\/v2\/categories?post=16"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}