Corralling National Federation of Independent Business v. Sebelius

By Alan B. Sternstein

In the U.S. Supreme Court’s Affordable Care Act case, National Federation of Independent Business v. Sebelius, 132 S. Ct. 2566 (2012) (“NFIB”), five justices of the Court expressed their concurrence in the view, stated most broadly, that the liberty of persons limits the scope of Congressional power under the Commerce Clause of the United States Constitution. Chief Justice Roberts articulated this view in a portion of his opinion for the Court, stating that, “Congress has never attempted to rely on that power to compel individuals not engaged in commerce to purchase an unwanted product,” id. at 2586, and that, “Allowing Congress to justify federal regulation by pointing to the effect of inaction on commerce would bring countless decisions an individual could potentially make within the scope of federal regulation and – under the Government’s theory – empower Congress to make those decisions for him,” id. at 2587. The justices dissenting from the opinion’s decision upholding a federal individual mandate for health insurance as a valid exercise of Congress’s power to tax, Justices Scalia, Kennedy, Thomas and Alito, expressed a broader view, stating that, “Whatever may be the conceptual limits upon the Commerce Clause and upon the power to tax and spend, they cannot be such as will enable the Federal Government to regulate all private conduct …,” id. at 2643 (emphasis added). According to the dissenting justices, “If Congress can reach out and command even those further removed from an interstate market to participate in the market, then the Commerce Clause becomes a font of unlimited power, or in Hamilton’s words, ‘the hideous monster whose devouring jaws … spare neither sex nor age, nor high nor low, nor sacred nor profane.’” Id. at 2646 (quoting The Federalist No. 33, p. 202 (C. Rossiter ed. 1961)).

In other words, although the justices other than the chief justice in the majority for the Court’s decision in NFIB, Justices Ginsberg, Sotomayor, Breyer, and Kagan, did not join the portion of the chief justice’s opinion expressing its theretofore unheard-of proposition regarding the reach of Congress’ power under the Commerce Clause, counting the four justices dissenting from the Court’s decision, five justices concurred in the proposition that an interest in personal liberty staked out constitutional territory into which Congress’ power under the Commerce Clause could not intrude, regardless of the effect of personal action or inaction, singularly or collectively, on interstate commerce.[1] Whether, therefore, that proposition, because five justices expressed their concurrence in it, constituted a holding of the Court has been the subject of significant debate.[2]

This legitimate debate, accordingly, leaves open the treatment to be given the proposition in the lower courts, until a more definitive announcement about its validity is given by the Supreme Court. For now, therefore, lower courts may expressly reject its application, expressly accept its application as binding,[3] accept or assume its application is binding but find that the Commerce Clause has not been violated in challenges to legislation brought before them, accept or assume its application is binding but distinguish cases in front of them as not subject to its applicability (because the subject legislation is not based on the Commerce Clause), or, as the Supreme Court itself did in NFIB, not decide challenges to federal legislation under the Commerce Clause by finding the legislation is also and validly based on sources of congressional power other than the Commerce Clause.

In the only Fourth Circuit case to address the matter, Liberty University, Inc. v. Lew, 733 F.3d 22 (2013), the court “express[ed] no opinion as to whether the limitation on the Commerce Clause power announced by five justices in NFIB constitutes a holding of the Court,” id. at 94 n.7. Rather, the court “assume[d] without deciding that it does,” id., and concluded that the provisions of the Affordable Care Act that require certain employers to offer a minimum level of health insurance coverage to their employees, the so-called “employer mandate,” are not restricted by the self-limitation on that power seen by those justices. It remains to be seen whether Liberty University’s provisional bow in the direction of NFIB becomes the law in the Fourth Circuit; no federal district court in the Fourth Circuit has addressed the issue, either definitively or provisionally.

The regard with which federal courts view the Commerce Clause’s self-limiting aspects newly found in NFIB has, of course, far-reaching implications, even in the absence of a future Supreme Court decision clarifying that there is within the Commerce Clause a personal-liberty self-limitation. If personal liberty is a factor, whether for individuals or other juridical entities, does not that mean that the validity of all legislation heretofore based on the Commerce Clause is subject to being revisited, because all such legislation constrains, in significant degrees, personal behavior, including private individual behavior that, collectively, significantly affects interstate commerce?[4] Would it be a sufficient answer to those justices who would curtail the reach of the Commerce Clause that, because the constraints of Commerce Clause regulation may be imposed as a condition of engaging or being in interstate commerce, there is no impermissible constraint on personal liberty? What role, then, would those justices find for the doctrine of unconstitutional conditions in undergirding their newfound source of personal liberty? See, e.g., Dolan v. Tigard, 512 U.S. 374 (1994) (limiting the degree to which government may use zoning and other land-use regulations to compel real-estate property owners to make public improvements as a condition of the use or development of their property).[5]

If lower courts now, like the Fourth Circuit in Liberty University, do not choose to challenge head-on this nascent interest in personal liberty supposedly residing in the Commerce Clause and, instead, choose to sidestep it, as the Fourth Circuit did, there will be a body of case-law giving breath to that interest, upon which the Supreme Court may in the future argue that there is license for its growth. Could such growth possibly be any more desirable now than it was in the first half of the 20th century, under the guise of substantive due process? Suppose one or more states were to decide that it was no longer a condition of vehicle ownership (of any type) that the vehicle owner carry liability insurance. Is there any doubt that Congress should, under the Commerce Clause, be able to step in and require that insurance be carried? Should, therefore, any quarter be given by the lower federal courts to the Commerce Clause’s husbandry of personal liberty ventured in NFIB any more than the husbandry by due process of a similar interest years ago, where there remains the opportunity to directly meet and reject it? It is a question for the Fourth Circuit, as well as all other lower federal courts whenever hereafter confronted with challenges based on the Commerce Clause and, indeed, the power to tax.[6]


[1] Until NFIB, the scope of Congress’ power under the Commerce Clause had always been expressed in terms defining its reach, not in terms of limitations or boundaries inherent in the power. Essentially, it has been held that Congress may regulate that which is or is in interstate commerce, see United States v. Morrison, 529 U.S. 598 , 609 (2000); Heart of Atlanta Motel, Inc. v. United States, 379 U.S. 241, 255 (1964), or “those activities that substantially affect interstate commerce,” Morrison, 529 U.S. at 609.  See also United States v. Darby, 312 U.S. 100, 115 (1941), recognizing that “regulations of commerce which do not infringe some constitutional prohibition are within the plenary power conferred on Congress by the Commerce Clause”).

[2] United States v. Henry, 688 F.3d 637, 641 n. 5 (9th Cir. 2012); see also United States v. Robbins, 729 F.3d 131, 135 (2d Cir. 2013); United States v. Roszkowski, 700 F.3d 50, 58 n. 3 (1st Cir. 2012) (declining to “express [an] opinion as to whether the . . . Commerce Clause discussion was indeed a holding of the Court”).

[3] Cf. Grutter v. Bollinger, 539 U.S. 306, 323 (2003) (noting that Justice Powell’s opinion announcing the judgment of the Court in Regents of University of California v. Bakke, 438 U.S. 265 (1978), although failing to command a majority of the Court, “has served as the touchstone for constitutional analysis of race-conscious admissions policies”).

[4] In this regard, one might also question why the coercive application of the power to tax is for Chief Justice Roberts and the dissenters in NFIB not also constrained by some self-limiting allowance for personal liberty as inherent in the taxing power as it is in the power to regulate with respect to interstate commerce. As Chief Justice Roberts wrote in NFIB, taxing those without health insurance “makes going without insurance just another thing the Government taxes, like buying gasoline or earning an income.” 132 S. Ct. at 2566. Well, okay, but why shouldn’t buying gasoline or earning a living be protected from the power to tax by some domain of personal liberty, just like, now, according to the chief justice and the dissenters, personal liberty is protected from regulation based on the Commerce Clause?

[5] U.S. Supreme Court Justice Robert H. Jackson cautioned decades ago, at the demise of Lochner-ian due process (see Lochner v. New York, 198 U.S. 45 (1905) (liberty of contract is inherent in due process)):

The task of translating the majestic generalities of the Bill of Rights . . . into concrete restraints on officials dealing with the problems of the twentieth century, is one to disturb self-confidence. These principles grew in soil which also produced a philosophy that the individual[‘s] . . . liberty was attainable through mere absence of governmental restraints. . . . We must transplant these rights to a soil in which the laissez faire concept of or principle of non-interference has withered at least as to economic affairs, and social advancements are increasingly sought through closer integration of society and through expanded and strengthened governmental controls.

W. Va. State Bd. Of Educ. v. Barnette, 319 U.S. 624, 639-40 (1943). Just how compelling and deserving of protection is the Commerce Clause’s putative personal-liberty interest compared to, say, the privilege of not being subject to governmental discrimination on account of race, gender, or national origin? If the interest in personal liberty supposedly protected within the Commerce Clause turns out to be in future decisions of the Supreme Court – claiming five certain justices for its majority – as weighty as the interests protected by the Bill of Rights and 14th Amendment, such that it may not be unduly burdened by conditions imposed under Commerce Clause regulation, will we not then effectively be back to the Lochner era, with the ball and chain on government’s power to affect for the better our economic existence being not due process but the Commerce Clause itself?

[6] See discussion, supra, n.4.

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