SAN FRANCISCO – On Dec. 13, the U.S. Court of Appeals for the 9th Circuit affirmed, vacated and remanded an Affordable Care Act case a handful of states filed against a number of federal agencies over regulations that would exempt religious employers from a contraceptive care policy.
Judge John Clifford Wallace, Judges Andrew J. Kleinfeld and Susan P. Graber were on the panel.
The 9th Circuit affirmed the preliminary injunction issued by the U.S. District Court of the Northern District of California regarding the enforcement the two interim final rules (IFRs) issued by defendant federal agencies in the plaintiff states, but it vacated the injunction that would bar enforcement nationwide. It remanded this issue to the District Court.
The ACA currently calls for all group health plans to cover contraceptive care without cost sharing. Federal organizations, including Department of Health and Human Services, U.S. Department of Labor, and U.S. Department of Treasury, released two IFRs that excused employers with religious and moral convictions from having to follow the rule of including contraceptive care in the coverage, particularly, those “with sincerely held religious beliefs objecting to contraceptive or sterilization coverage,” according to the opinion. It later broadened its impact to include companies with moral convictions. The opinion states the agencies issued this in October 2017 without prior notice or comment.
California, Delaware, Virginia, Maryland and New York sued the agencies in the U.S. District Court for the Northern District of California to block them from being able to enforce the IFRs, citing the Administrative Procedure Act (APA). The District Court put out a national preliminary injunction. It also permitted Little Sisters of the Poor, Jeanne Jugan Residence and March for Life Education and Defense Fund to intervene in the case. These organizations in turn appealed the District Court’s response on venue, standing and the preliminary injunction.
Despite the federal agencies’ argument that the Northern District of California venue wasn’t proper, the 9th Circuit insisted that it was. While the agencies argued that California is in the Eastern District since that’s where its capital is, the 9th Circuit was not moved. The agencies argued California is an entity, while the 9th Circuit stated, “a state is ubiquitous throughout its sovereign borders,” including the Northern District, and not restricted to the Eastern.
The 9th Circuit also determined the states have proper standing to sue as they "bear the burden of establishing 'the irreducible constitutional minimum' of standing," the opinion states.
It agreed with the district court that the states "are likely to succeed on the merits of their APA claim."
Kleinfeld dissented with the majority's findings.
"The plaintiff state governments lack standing, so the district court lacked jurisdiction," he wrote. "The reason they lack standing is that their injury is what the Supreme Court calls 'self-inflicted,' because it arises solely from their legislative decisions to pay these moneys. Under the Supreme Court's decision in Pennsylvania v. New Jersey, we are compelled to reverse."