ACRU

Court Opens Terms with Question of Standing

This column by ACRU Senior Legal Analyst Ken Klukowski was published October 4, 2011 on The Washington Examiner website.

Can private parties sue to enforce a federal statute when Congress does not say so? That’s what the Supreme Court is deciding in a case heard on the opening day of its current term.

The court’s first case this term involves Medicaid. The justices considered if Medicaid recipients can sue when a state cuts Medicaid payments, or instead if that is a matter left to federal and state governments to sort out.

The case is actually three consolidated cases from various Medicaid recipients in California, named Douglas v. Independent Living Center. The U.S. Court of Appeals for the Ninth Circuit held in favor of the plaintiffs in all three. The Supreme Court is deciding whether federal district and appeals courts even have jurisdiction to hear these cases.

A person cannot sue for violations of a federal statute unless he or she has a right to sue (also known as “standing”). The courts are not watchdogs policing governmental compliance with statutes. Congress makes federal law, and so Congress decides who can sue to enforce those laws if they are broken.

The right to file suit in court is called a “right of action” or “cause of action.” Most are express rights of action, meaning Congress explicitly writes into the statute that parties aggrieved by a violation can demand a judge to order compliance.

But occasionally when a statute is silent a court will still find an implied right of action. Among other things, this happens when Congress conveys clearly defined rights to private citizens, and indicates its intent for the courts to vindicate those rights.

The Constitution’s Supremacy Clause declares that federal law trumps state law. The plaintiffs in Douglas claimed an implied right of action under the Supremacy Clause to stop California from cutting Medicaid payments to providers.

The first lawyer speaking was California Deputy Attorney General Karin Schwartz, who seemed out of her depth. While her argument was persuasive, her style was unpolished, fumbling several answers and failing to observe etiquette by not addressing court members as “Mr. Justice” and only rarely using “Your Honor.”

Justice Ruth Bader Ginsburg was skeptical of Schwarz’s argument that private parties could not sue to enforce this section of Medicaid, asking if the only recourse for state Medicaid violations was for the federal government to cut off funding.

Justice Elena Kagan also objected, saying this would treat the Supremacy Clause differently than all other constitutional provisions.

U.S. Deputy Solicitor General Edwin Kneedler fared better, limiting the breadth of his position, arguing that this lack of a right of action only applies to Spending Clause matters, under which Congress can attach conditions to funding federal programs.

The plaintiffs were represented by SCOTUS veteran Carter Phillips, who ably argued for private citizens and companies to challenge Medicaid payments.

He ran into stiff opposition from several justices. Justice Sonia Sotomayor said she might have a problem with telling Congress it can’t disallow lawsuits.

Justice Anthony Kennedy added that a key part of Phillips’ argument was circular. And Justice Stephen Breyer was concerned that Phillips’ position would open the floodgates of litigation, insisting, “There must be a limit.”

The toughest questions came from Chief Justice John Roberts, who seemed incredulous that Congress could make a law administered by an agency, but could not effectively keep private citizens from dragging the agency into court to force its decisions. If Congress doesn’t declare a right of action, then “that means there isn’t one,” Roberts concluded.

Federal and state governments may have finished on top today. This case has important implications, from Obamacare to the Planned Parenthood lawsuits over abortion funding. A decision is likely early next year.