Wednesday, November 15, 2006

US Dist Ct Dismisses DRA Challenge

On November 6, 2006, a United States District Court Court, sitting in the Eastern District of Michigan, per Judge Nancy G. Edmunds, dismissed a challenge previously filed by eleven Congressional Representatives to enactment into federal law of the Deficit Reduction Act of 2005. The decision & opinion in the case, Conyers v. Bush, is found here.

The DRA significantly changed rules governing the treatment of transfers of assets & interests in homes by nursing home residents later seeking Medicaid benefits. The implementation of these changes will proceed state-by-state over the next few years. The DRA is generally described in Wikipedia here.
The Bush Administration's explanation of the DRA, generally, is found here.

These are the facts giving rise to the constitutional challenge of the DRA in federal courts. On December 19, 2005, the House of Representatives passed a conference report on S. 1932, the Deficit Reduction Act of 2005, by a vote of 212-206. On December 21, 2005, the Senate passed the conference report by a vote of 51-50. Because the Senate made a minor change in the conference report, it was returned to the House for its approval. But thereafter, the House did not approve the exact same bill as the Senate. The President then signed a bill into law.

In their lawsuit, the plaintiffs claimed that the
Deficit Reduction Act of 2005, Pub. L. No. 109-171, § 10001, 120 Stat. 4, § 183, was invalid and did not comply with Article I, Section 7, of the U.S. Constitution. They claimed that the DRA did not pass the House in the same form passed by the Senate, and that the bill signed by the President therefore could not become law.

More specifically, those Representatives argued that
Section 5101 of the DRA conflicted as follows:

  • The bill, as passed by the Senate, set the duration of Medicare payments to rent certain durable medical equipment at 13 months
  • The bill, as as passed by the House, set the duration of rent payments at 36 months
The Defendants (including the President), who were represented by the United States Justice Department, argued that the Plaintiffs lacked legal "standing" to sue; and the Court agreed. The Judge noted that the United States District Court for the Southern District of New York also recently addressed "standing" in a case that raised the same constitutional arguments against the DRA, in OneSimpleLoan v. U.S. Sec’y of Educ., 2006 WL 1596768 (S.D.N.Y. June 9, 2006).

That district court found no such standing for the plaintiffs to sue. This Court followed that ruling's reasoning, and found that the "Plaintiffs here lack standing because they cannot show that their votes were sufficient to defeat a bill with the 13 month provision."

The Court further ruled that,
even if the Plaintiffs did have standing, the Court agreed with Defendants that their claims were subject to dismissal on a summary basis, without further hearing. The Court reviewed other, almost identical challenges filed in federal courts to the DRA:
The basic facts alleged in Plaintiffs' complaint concerning how the Deficit Reduction Act was passed have been observed by a number of courts addressing the same or similar concerns that Plaintiffs raise here. See Public Citizen v. Clerk, United States District Court for the District of Columbia, ___ F. Supp. 2d ___, 2006 WL 2329329, *2 (D. D.C. Aug. 11, 2006); Cal. Dep't of Soc. Servs. v. Leavitt, 444 F. Supp. 2d 1088, 1096 (E.D. Cal. 2006); OneSimpleLoan v. U.S. Sec'y of Educ., No. 06 Civ. 2979 (RMB), 2006 WL 1596768, *4 (S.D. N.Y. June 9, 2006).

Each of the courts that have addressed the identical issue presented here have held that enrolled bill rule announced in
Marshall Field still applies today. Thus a claim of unconstitutionality for violation of Article I, Section 7, "is not legally cognizable where an enrolled bill has been signed by the presiding officers of the House and Senate as well as the President. . . ." Public Citizen, __ F. Supp. 2d at __, 2006 WL 2329329 at **4, 16.
For these reasons, the Court granted a motion to dismiss. As a result, the DRA still remains enforceable federal law, unless the trial court's action would be overturned by federal appellate courts.

* * *

Update: 02/12/07:

For an excellent update on the litigation in the federal courts derived from the DRA's manner of enactment by Congress, see:
"The DRA One Year Later: Dems Waiting for Outcome of Legal Challenges to Law That Stiffens Medicaid Transfer Penalties", dated February 10, 2007. Here is an excerpt:

So far, federal district courts have rejected five challenges to the DRA's legitimacy, including ones by Public Citizen and by Rep. John Conyers (D-MI) and ten other members of the House of Representatives.

While these cases remain on appeal to federal circuit courts, a sixth challenge brought by ElderLawAnswers member attorney Jim Zeigler in federal district court for the Southern District of Alabama is still pending. (See Elder Law Attorney Sues Over New 'Law' Affecting Medicaid Transfers" .) Zeigler says his suit has a better chance of succeeding than the others because of support from an unexpected source.