Appeals court skeptical of argument to end ACA coverage requirements during appeal

An unusual argument at the Fifth Circuit, the nation's most conservative appeals court. Also: Another public defender gets a high court nod.

A case brought by businesses and individuals challenging federal requirements that insurance include no-cost coverage for the HIV-prevention drug known as PrEP and for contraception, largely due to their religious opposition, led to a ruling earlier this year that would end dozens of unrelated coverage requirements, including several cancer and other health screenings.

On Tuesday, a federal appeals court panel was skeptical of arguments to allow the ruling to take effect nationwide while the appeals court considers the appeal.

The Justice Department, in its arguments Tuesday, focused on the broad-ranging possible consequences of allowing the ruling to go into effect during the appeal, while the lawyer for the plaintiffs, in large part, argued that a stay was unnecessary because no insurers would change their plans while the case was still on appeal.

By the end of the slightly more than 40 minutes of arguments, it appeared that the panel was unconvinced of the plaintiffs' broadest arguments against any stay — and that the plaintiffs’ lawyer, conservative firebrand Jonathan Mitchell, realized that and was ready to negotiate.

Less than 20 hours after the arguments, on Wednesday morning, the court issued a brief order asking the parties to give them “a report on possible agreement to the terms of a stay“ by 5 p.m. CT Friday.

What’s going on?

The nationwide effect of the ruling from U.S. District Judge Reed O’Connor in Texas is already on hold. This is so because a different panel of the U.S. Court of Appeals for the Fifth Circuit, known as a motions panel, issued an administrative stay of that part of O’Connor’s ruling in May. The motions panel, however, allowed the merits panel that would be hearing the actual appeal to decide what to do with the Justice Department’s request for a partial stay of O’Connor’s ruling throughout the appeal.

The merits panel could have just allowed the administrative stay to remain in place while it considered the appeal — essentially obviating the need to rule on the government’s formal request for a partial stay. Instead, Judges Edith Brown Clement and Leslie Southwick, George W. Bush appointees, and Judge Stephen Higginson, an Obama appointee, decided to hear arguments on the partial stay request before hearing the appeal on the merits.

Which brings us to Tuesday

On Tuesday, Alisa Klein, arguing for the Justice Department, repeatedly made clear that the Justice Department has not asked for the ruling in favor of the actual plaintiffs in the case to be put on hold during appeal — a point that ended up working in her favor by making DOJ look, as Higginson put it, “for lack of a better word, generous.”

Instead, she explained, DOJ’s main concern is that O’Connor’s ruling, if allowed to go into effect in full during the appeal, would “extinguish[] the rights of about 150 million people who are not parties to this case or before the court.”

Granting the partial stay during the appeal, on the other hand, would have “no appreciable impact on the plaintiffs at all,” Klein argued. “They have no interest in the terms of the two and a half million group health plans that are offered by employers for whom they don't work. These are other people's plans, and it's very important to the people insured under those plans that they have this cost-free coverage for the 50 categories of preventive services” that are covered as a result of decisions from the United States Preventive Services Task Force.

O’Connor had found, in a ruling last year in the case, that the members of the task force — which existed for about 25 years before the ACA’s passage — are appointed unconstitutionally under the Appointments Clause of the U.S. Constitution in light of the power given to the task force to set these insurance coverage requirements under the ACA through their recommendations. While DOJ argued for a limited remedy in the case, the plaintiffs argued — and O’Connor ultimately agreed in the March ruling — that all of the task force’s recommendations are illegal and all agency actions enforcing them should be vacated.

While there was discussion on Tuesday as to whether the parties had standing to seek this relief, Klein made clear that, while that would be a part of DOJ’s merits brief, their partial stay request primarily comes down to irreparable harm.

“What is the harm to them?” Klein asked, regarding the plaintiffs and the harm of staying the nationwide effect during the appeal. “And we don’t see any harm to them … from the staying of the universal remedies.”

The plaintiff’s lawyer, Mitchell, didn’t have much of a response to that point, leading to a someone unusual argument.

Mitchell is the former solicitor general of Texas. Since leaving that role and starting his own private practice, he has taken on a role as a leading litigator for reactionary conservative causes, from ending abortion to this case to defending a library’s book ban (a case I’ve covered previously that he argued at the Fifth Circuit on Wednesday).

The Fifth Circuit, meanwhile, is the most conservative appeals court in the country, so Mitchell generally expects a receptive audience — although Tuesday’s panel, for a Fifth Circuit panel, was relatively reasonable.

Throughout his 20 minutes, though, Mitchell took on very skeptical questions from Higginson, as well as a handful of skeptical questions — including right out of the gate — from Southwick. Clement asked no questions to either attorney.

And though Mitchell began Tuesday’s arguments by saying that DOJ’s request “should be denied for numerous reasons,” he then took a turn from which he never quite recovered, arguing:

There is no evidence or reason to believe that any private insurer or employer will drop or limit coverage of statutorily required preventive care in response to the district court's ruling while this case remains on appeal. As long as it remains possible that the district court's judgment might be vacated or reversed even in part, no rational employer or insurer can take the risk that they could be subject to statutory penalties in response to conduct they're taking right now.

Before he could go on, Southwick cut him off, saying that Mitchell was seeking “speculation” from the court, and ultimately saying that Mitchell’s argument sounded “unusual.” When Mitchell attempted to say this was his side of the “irreparable harm” argument, Southwick shot back, “You’re still asking us to predict how insurers will react, and I’m not sure what we have to go on.”

After some discussion of the standing questions as to the individual plaintiffs, which Higginson repeatedly questioned and which is relevant because it could be decisive in terms of the ultimate scope of the remedy, Mitchell, sensing the ground shifting beneath him, somewhat backed off on his initial argument.

Ultimately, Mitchell returned to a question that Southwick asked at the start of the argument — whether there was “some way for the parties to address now or maybe discuss amongst themselves … what could be done — if something is to be done at all, that's not been decided — to limit the effect of the district judge's ruling.”

Referencing Southwick’s question, Mitchell said, “Maybe there is that potential, because from our standpoint, we don't believe anyone, even our own clients, should be changing their self-insured plans in reliance on the district court's judgment.” Continuing, he said, “Maybe there is a way we could come together to a stipulated resolution that makes that clear in something that might have the effect of the partial stay the government seeking —”

Southwick interjected: “Depending on when your trips home occur, you might pursue that.”

“I don't think we're that far apart,” Mitchell replied. “I mean, we do agree in our briefing with a lot of government’s critique of of universal remedies.”

By time Klein got up for her rebuttal, sensing the tone of the the arguments, she took advantage of it.

“We are always open to anything the other side wants to offer,” she said — adding, one last time, “We're struggling to understand why they're opposing a stay of the universal remedies.”

Professional diversity on the courts

Before I close, I just wanted to make sure you check out an article I published Tuesday at Bolts, focused on Democratic New Jersey Gov. Phil Murphy’s latest state supreme court nominee, former public defender Michael Noriega.

From the article:

The absence of experiential diversity, [Murphy’s chief counsel, Parimal Garg] added, can harm the court. Without it, “it becomes challenging for that court to come up with jurisprudence that really understands where everyone is coming from in terms of the different roles that people have to play.”

…

Adding Noriega’s perspective could be important in future cases likely to come before the court, [Jennifer] Sellitti, from the public defender’s office, said. 

“I’m really excited about having his voice on the court when it comes to Fourth Amendment issues, cases that involve discussions of race and systemic racism,” she told Bolts, before also mentioning cases that touch police accountability, discovery, and immigration detention.

Read the whole piece here.