Judge allows Obamacare subsidies lawsuit to proceed, but stops short of imposing injunction

Oct 24 2013

A federal judge Tuesday allowed a legal challenge against the health law's insurance price subsidies to go forward, but stopped short of imposing an injunction that would have halted the subsidies until the legal matter is resolved. At issue is a challenge to how the Obama administration determines who gets what subsidies and the related tax penalties.

The New York Times: Judge Allows Legal Challenge Of Law To Continue
A federal judge cleared the way on Tuesday for consumers to challenge President Obama's health care law on the grounds that the federal government cannot legally provide subsidies to people who buy insurance through the exchange run by it. The judge, Paul L. Friedman, of Federal District Court here, said that four individuals could pursue their lawsuit challenging the Obama administration's interpretation of a provision of the law that defines who is eligible for subsidies (Pear, 10/22).

The Wall Street Journal: Judge Allows Suit Challenging Health-Law Subsidies
The mixed ruling means the Obama administration will have to mount a full defense of the law's subsidy provisions in a Washington, D.C., federal court. Challengers had sought a preliminary injunction to block subsidies immediately for those who buy health insurance through federally run online exchanges. Such an injunction could have dealt a considerable blow to the administration at a sensitive time, as U.S. officials continue to fight technical difficulties with a federally run website (Kendall, 10/22).

Politico: Challenge To Affordable Care Act Subsidies Advances
D.C. District Judge Paul Friedman has allowed a case challenging the federal government's authority to give out premium subsidies on the federal exchanges to go ahead but has denied a request for a preliminary injunction to block the subsidies from flowing. Friedman denied on standing grounds the government's motion to dismiss the case, saying that four individual plaintiffs in Halbig v. Sebelius have standing to sue over the IRS rule allowing insurance subsidies to be awarded (Cunningham, 10/23).

Reuters: Judge Declines To Halt 'Obamacare' Insurance Subsidies
Foes of President Barack Obama's healthcare law lost a bid on Tuesday to put an immediate stop to a key part of the law -- the insurance subsidies in the 34 U.S. states that declined to establish their own online marketplaces. At a court hearing, U.S. District Judge Paul Friedman in Washington, D.C., declined to grant a preliminary injunction sought by a group of individuals and small businesses that in a lawsuit call the subsidies unlawful (Ingram and Drawbaugh, 10/22).

CNN: Fed Judge Allows Case Challenging ObamaCare Penalties To Continue 
A federal judge on Tuesday allowed a case to go forward challenging the constitutionality of imposing tax penalties under ObamaCare on those who fail to buy health insurance. Judge Paul Friedman denied a Justice Department request to have the case dismissed, in making the ruling in the U.S. District Court for the District of Columbia. Separately, the judge denied a request by the plaintiffs to get a preliminary injunction to stop subsidies through the Obamacare insurance exchanges in 34 states. Friedman said the plaintiffs had not proven "irreparable harm" by either taking the insurance with the subsidy or paying the penalty (10/22).

Fox News: Jay Sekulow: ObamaCare Lawsuits Could Reach Supreme Court 
A federal judge's decision to allow a case to go forward that challenges the constitutionality of Obamacare's tax penalties could signal trouble for the President's signature law, Jay Sekulow, chief legal counsel of the American Center for Law and Justice and the attorney at the center of the case, told Megyn Kelly Tuesday. "What's at stake is the IRS taking on a broader scope of what it's allowed to regulate or impose," Sekulow said on "The Kelly File" (10/23).

In news regarding other pending legal challenges --

The Associated Press: Hobby Lobby Asks Supreme Court To Rule On Health Care Law
Lawyers for Hobby Lobby asked the U.S. Supreme Court on Monday to take up the company's lawsuit against the federal health care law's requirement that coverage include access to the morning-after pill. Lawyers for the Oklahoma City-based craft store chain and its sister company, Mardel Christian bookstore, asked the U.S. Supreme Court to take up the case because of what they say are conflicting decisions by other courts regarding religious freedom (10/22).

Meanwhile, legal experts are eyeing the web site problems as another potential point for lawsuits --

Politico: Obamacare Site could Mean Legal Fights
If the Obamacare enrollment website seems like a tangled mess, just wait for the lawsuits. The potential for a morass of litigation over who's responsible for the problems that have plagued the rollout of President Barack Obama's signature health care law is significant, government procurement experts say (Gerstein, 10/23).