Resource: Liberty University, Inc. v. Geithner, No. 10-2347

The plaintiffs, Liberty University and two individuals, brought suit seeking to enjoin the Secretary of the Treasury from enforcing the “individual” and “employer mandates” in the recently passed Patient Protection and Affordable Care Act (“Act”), also known as “Obamacare,” that require purchasing healthcare coverage. The individuals argued that they had made a conscious choice not to purchase healthcare and the mandate to do so was an unconstitutional penalty couched as a tax. Liberty argued that several of its employees would be eligible for tax credits or cost-sharing reductions under the Act which would subject the employer to “assessable payments” and cause undue financial hardship for the University by means of improper and unconstitutional taxation. The district court held that the exactions were not taxes; it also held that the Act was a valid exercise of Congress’s Commerce Clause powers and dismissed the action.