Today the U.S. Court of Appeals for the Eleventh Circuit denied the U.S. government's motion for an en banc review of the panel decision. One of the court's judges, Judge Robin Rosenbaum (an Obama appointee) dissented, and Judge Jill Pryor (an Obama appointee) recused herself.
The panel decision, issued on January 20, held that the statute is unconstitutionally unascertainable in violation of the Spending Clause, without reaching coercion or Tenth Amendment claims. Judge Andrew Brasher (a Trump appointee), concurring with the denial of en banc review, summarizes: "This result is hardly surprising. The only other circuit court to have reached the merits of this dispute, the Sixth Circuit, has agreed with the panel opinion that the Rescue Plan's offset provision is 'impermissibly vague under the Spending Clause.' And almost every district court to have considered the issue has reached a similar conclusion [citing decisions in Texas and Ohio]. Although the government asked the Sixth Circuit to reconsider its decision, it did not petition for review in the Supreme Court. So the issue seems to be resolved.
Judge Rosenbaum, dissenting over 53 pages, says the panel sees a "doomsday interpretation" of the statute that is "implausible." The statute's use of "indirectly" is "clear" in meaning that Congress prohibits circumvention of the direct prohibition and that there is meaning in that Congress wrote "net tax revenue" and not "expected net tax revenue." Acknowledging that "the text alone does not answer...which pre-March 3, 2021, fiscal year serves as the baseline," Rosenbaum concludes from contextual analysis that it must be "each state's fiscal year 2019." Because the statute can only "plausibly bear the narrower interpretation this opinion explains," there is no basis for invocation of the major questions doctrine or invalidating "a perfectly valid congressional enactment."
The federal government may, if it wishes, appeal this decision to the U.S. Supreme Court. As Judge Brasher noted, the federal government recently declined to appeal the Sixth Circuit decision to the Supreme Court.
If you're keeping score, here's the status of the litigation efforts:
OHIO: Victory for federal government on standing. District court ruled for the state on standing and merits, Sixth Circuit reversed as to standing, Ohio appealed to U.S. Supreme Court but certiorari denied. Justice Kavanaugh noted that he would grant cert.
ARIZONA: Victory for state on standing, no merits decision. District court ruled for federal government on standing grounds, Ninth Circuit reversed and remanded for consideration on the merits, state subsequently abandoned the case following a change in partisan control.
MISSOURI: Victory for federal government on standing, no merits decision. District court ruled for federal government on standing grounds, Eighth Circuit affirmed, State appealed to Supreme Court but certiorari denied.
WEST VIRGINIA and 12 other states: Victory for state on standing and merits. District court ruled for state, Eleventh Circuit panel affirmed, Eleventh Circuit denied en banc review.
KENTUCKY & TENNESSEE: Victory for TN on standing and merits, for federal government on KY standing. District court ruled for states, Sixth Circuit affirmed as to TN but reversed as to KY on standing grounds, Sixth Circuit denied en banc review, federal government did not appeal to U.S. Supreme Court.
TEXAS, MISSISSIPPI, LOUISIANA: Victory for states on standing and merits. District court ruled for states on standing and merits, appeal pending with Fifth Circuit (argued Apr. 3, 2023).