The Supreme Court Argues Over Boring Statutes for the Fun of It

Oral argument from the court.
March 26 2012 6:17 PM

You Say Tax, I Say Penalty

On day one of the Supreme Court arguments over Obamacare, the justices did what they do best: argue over boring old 19th-century statutes for the fun of it.

U.S. Supreme Court members pose for photographs.
The Supreme Court heard its first day of arguments regarding the Affordable Care Act, also known as Obamacare

Chip Somodevilla/Getty Images.

Read all of Slate’s coverage about the Affordable Care Act.

At first glance, this morning’s 90-minute oral argument in the first of a three-day assessment of the constitutionality of the Affordable Care Act, looks something like the court coughing up a big old drama-killing hairball. For one thing, the issue is arcane and hypertechnical: Does a 19th-century statute—the Anti-Injunction Act—which provides that “no suit for the purpose of restraining the assessment or collection of any tax may be maintained in any court by any person”—bar the Supreme Court from even hearing the health care cases until someone has refused to purchase health insurance and paid a penalty for it? Since that won’t happen until 2014, the Anti-Injunction Act offered at least one federal appeals court the attractive option of making this whole case disappear for a few more years.

Dahlia Lithwick Dahlia Lithwick

Dahlia Lithwick writes about the courts and the law for Slate. Follow her on Twitter.

That now looks unlikely to happen. Because both the Obama administration and the opponents of the health care bill want the Supreme Court to decide the suit now, the court had to appoint an outside advocate—D.C. lawyer Robert Long—to argue that the court has no jurisdiction to hear the case. Forty minutes into his argument (which sounded more like a complex tax seminar than a fight over health care) Long didn’t appear to have too many buyers for the idea that these challenges should ripen on the shelf for a few more years. Everyone emerges from court this morning just a little glassy at having been pepper-sprayed by multinumbered tax-code references for well over an hour.

It’s kind of fantastic.


Long describes the Anti-Injunction Act as a “pay first, litigate later” rule that allows the collection of taxes to occur efficiently. (Justice Stephen Breyer will later describe taxes as “the life’s blood of the government.”) Long tries to persuade the court of the dangers of allowing the “taxpayer to go into court at any time,” but Justice Sonia Sotomayor seems dubious, asking him to lay out the “parade of horribles” that might happen if the tax law doesn’t apply here.

Long does a good job responding to what feels like sequential head-bonkings by one justice after another. But it’s plain that several justices were not going to be able to get past old case law, and others simply doubted whether the health care law is a jurisdictional statute. By mid-morning a general consensus has emerged, as Sotomayor puts it, “that Congress has accepted that in the extraordinary case we will hear the case.”

Justices Sotomayor and Antonin Scalia do a bit of philosophizing about whether there should ever be any jurisdictional rules at all, leading Long to respond that “not all people who litigate about federal taxes are necessarily rational.” Then Justice Stephen Breyer explains that while he is leaning toward Long on the jurisdiction issue, he has a different problem with deploying the tax law to squash this suit. As he puts it: “Now, here, Congress has nowhere used the word ‘tax.’ What it says is penalty.”

Long replies that “it's part of the taxpayers' annual income tax return. The amount of the liability and whether you owe the liability is based in part on your income. It's assessed and collected by the IRS.” But Justice Scalia jumps in to add that the courts adhere to a principle that “unless it's clear, courts are not deprived of jurisdiction, and I find it hard to think that this is clear. Whatever else it is, it's easy to think that it's not clear.”

The big textual hiccup here is that the provision requiring you to pay money if you fail to buy health insurance is called a “penalty” under the law and not a “tax.” That’s what Breyer keeps coming back to this morning. And it forces Solicitor General Donald B. Verrilli Jr. into taking the position that the Anti-Injunction Act doesn’t apply to the health care law because this just isn’t a tax.

Verrilli opens by cautioning, “This case presents issues of great moment, and the Anti-Injunction Act does not bar the court's consideration of those issues.” He adds that this isn’t a tax “even though the minimum coverage provision of the Affordable Care Act is an exercise of Congress' taxing power as well as its commerce power.” This is just too much for Justice Samuel Alito who breaks in to say: “General Verrilli, today you are arguing that the penalty is not a tax. Tomorrow you are going to be back and you will be arguing that the penalty is a tax. Has the court ever held that something that is a tax for purposes of the taxing power under the Constitution is not a tax under the Anti-Injunction Act?”

Verrilli replies that for purposes of tomorrow’s discussion it doesn’t matter whether Congress called it a tax. But for Anti-Injunction Act purposes the words tax versus penalty drive the whole outcome. He warns that it would be dangerous for the court to find that the Anti-Injunction Act is not a jurisdictional provision. He just wants the court to determine that it doesn’t apply here.