The Judge's Order is 65 pages and can be found here.
The first at-length discussion is whether the fine for not buying insurance is a "penalty" or a "tax. Those are two different things, legally speaking. A "tax" is authorized to Congress through its rather broad taxing authority. A "penalty" comes under the more narrow Commerce Clause authority. Also, if a "tax," then the discussion in a lawsuit may be premature, since the liability doesn't arise until 2014 and other cases establish so. A "penalty" is couched in the Commerce Clause, and the entire scheme can be reviewed now.
Remember the early days of the discussion? Republicans (they can't be this smart) shouted that it was a tax – an increase in taxes. So the democrats and Obama yelled back that it was not a tax. And the latter made sure the law read that way.
Well, when the lawsuits started flying, all of a sudden the Obamanauts are calling it a "tax" because they realized that they could lose the ripeness argument ("too early") if it were a "penalty."
The Judge handles it this way:
The defendants assert in their memorandum, see Memorandum in Support of Defendants' Motion to Dismiss ("Def. Mem."), at 33, 50 n.23 (doc. 56-1), as they did during oral argument, that in deciding whether the exaction is a penalty or tax,"it doesn't matter" what Congress called it because the label "is not conclusive." See Transcript of Oral Argument ("Tr."), at 27-29 (doc. 77). As a general rule, it istrue that the label used is not controlling or dispositive because Congress, at times,may be unclear and use inartful or ambiguous language. Therefore, as the Supreme Court recognized more than 100 years ago in Helwig, supra, the use of a particular word "does not change the nature and character of the [exaction]," and it is the ultimate duty of the court to decide the issue based on "the intrinsic nature of the provision" irrespective of what it is called. See 188 U.S. at 612-13; accord Cooleyv. Bd. of Wardens, 53 U.S. (12 How.) 299, 314, 13 L. Ed. 996 (1851) ("it is thething, and not the name, which is to be considered"). However, as also noted in Helwig, this rule must be set aside when it is clear and manifest that Congress intended the exaction to be regarded as one and not the other. For that reason, the defendants are wrong to contend that what Congress called it "doesn't matter." To the extent that the label used is not just a label, but is actually indicative of legislative purpose and intent, it very much does matter. By deliberately changing the characterization of the exaction from a "tax" to a "penalty," but at the same time including many other "taxes" in the Act, it is manifestly clear that Congress intended it to be a penalty and not a tax.
Hoist by their own petard. They called it a "penalty," by God it is, and this Court has jurisdiction to review it right now. There are other reasons for this designation such as Congress citing Commerce Clause authority and their failure to identify a revenue-raising purpose for the money extorted inward.
Here's how weakly the Obamanaut argument stands that it is a tax: The defendants have not pointed to any reported case decided by any courtof record that has ever found and sustained a tax in a situation such as the one presented here, and my independent research has also revealed none. At bottom, the defendants are asking that I divine hidden and unstated intentions, and despite considerable evidence to the contrary, conclude that Congress really meant to say one thing when it expressly said something else.
Of course, to us it is a tax. Everything we pay to the government is a tax. But it makes a difference in this case.
And it's so much fun to see them flailing about trying to prove what Barry said was not a tax, is, in fact, a tax. I think the Judge says it best:
This conclusionis further justified in this case since President Obama, who signed the bill into law, has "absolutely" rejected the argument that the penalty is a tax.
Too funny.
But the Judge was not amused. Not, at least, with the lead government attorney.
This foregoing statement highlights one of the more troubling aspects of the defendants' "newfound" tax argument.
The "foregoing statement is a reference to the lead government attorney speaking in the Virginia ObamaCare case:
In Virginia v. Sebelius, 3:10cv188, one of the twenty or so other lawsuits challenging the Act, the federal government's lead counsel (who is lead defense counsel in this litigation, as well) urged during oral argument in that case that the penalty is proper and sustainable under the taxing power. Although that power isbroad and does not easily lend itself to judicial review, counsel stated, "there is a check. It's called Congress. And taxes are scrutinized. And the reason we don't have all sorts of crazy taxes is because taxes are among the most scrutinized things we have. And the elected representatives in Congress are held accountable for taxes that they impose." See Transcript of Oral Argument (Virginia case), at 45.
The emphasis on "tax" is what this court noted:
Congress should not be permitted to secure and cast politically difficult votes on controversial legislation by deliberately calling something one thing, after which the defenders of that legislation take an "Alice-in-Wonderland" tack and argue in court that Congress really meant something else entirely, thereby circumventing the safeguard that exists to keep their broad power in check.
Smack. And if that wasn't enough, the Judge quoted Alice in the footnote:
Lewis, Carroll, Through the Looking-Glass, Chapter 6 (Heritage 1969):"When I use a word," Humpty Dumpty said, in a ratherscornful tone, "it means just what I choose it to mean —neither more or less."
"The question is," said Alice, "whether you can makewords mean so many different things."
This all falls under the rubric, "Counsel, I cannot believe you just said that."
Ouch. That'll leave a mark.
Sent from my iPhone
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