- Trevor Brown, Pelopidas, LLC
In a case decided on Tuesday, July 22, 2014 by the D.C. Circuit Court of Appeals, the court ruled that subsidies can be granted only to those people who bought health insurance in exchanges run by an individual state or the District of Columbia, and not to people who purchased health insurance on the federally run exchange, HealthCare.gov. How did the court reach its conclusion, and is the court’s reasoning sound? Will the ruling make the Affordable Care Act financially unworkable? Is a final ruling by the U.S. Supreme Court inevitable?
At bottom, in Kuretski v. Commissioner, presidential power is at stake. Judges of the U.S. Tax Court (26 USC 7443(f)), were arguably characterized by the U.S. Supreme Court, in Freytag v. Commissioner, as exercising a portion of the judicial power of the United States. Recently, however, the D.C. Circuit Court of Appeals disagreed when it found that the Tax Court exercises only executive power. What are the implications of the D.C. Circuit Court’s opinion on the president’s removal power? Has the D.C. Circuit misread Freytag, or faithfully applied it?
On June 19, 2014, the Supreme Court issued its opinion in United States v. Clarke. The question in this case is whether an unsupported allegation that the Internal Revenue Service (IRS) issued a summons for an improper purpose entitles an opponent of the summons to an evidentiary hearing to question IRS officials about their reasons for issuing the summons.
Justice Kagan delivered the opinion for a unanimous Court, which held that an allegation of improper purpose does not entitle a taxpayer to examine IRS officials. Rather, the taxpayer may do so when he can point to “specific facts or circumstances plausibly raising an inference of bad faith." The contrary decision of the Eleventh Circuit was vacated and the case remanded for further proceedings.
To discuss the case, we have Kristin Gutting, an associate professor of law at the Charleston School of Law.