Today a unanimous panel of the U.S. Court of Appeals for the Sixth Circuit upheld a district court injunction against the Biden Administration's order that federal contractors ensure their employees receive COVID-19 vaccinations. The opinion in Commonwealth of Kentucky v. Biden was written by Judge Larsen, and joined by Judges McKeague and Siler. I wrote about earlier decisions concerning this mandate here and here.
Judge Larsen begins with a summary of her opinion:
A fundamental tenet of our constitutional order is that the President's authority "must stem either from an act of Congress or from the Constitution itself." Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 585 (1952). The critical question in this case is whether the President heeded this rule when he ordered all federal agencies to include in their new contracts a provision obligating contract recipients to require their employees to wear face masks at work and be vaccinated against COVID-19. The President has claimed no inherent constitutional power here; instead, he maintains that the Federal Property and Administrative Services Act of 1949 authorized his order. The district court and a motions panel of this court concluded that the President likely exceeded his powers under that Act. We agree. We therefore affirm the district court's decision to preliminarily enjoin the federal government from enforcing the mandate, but we modify the scope of the injunction.
The primary legal quesiton in this litigation concerns the scope of the President's authority to impose conditions on federal contractors under the Federal Property and Administrative Services Act, generally known as the "Property Act."
As I discussed in my post on a different Sixth Circuit panel's earlier refusal to stay the district court injunction, the leading cases on this question are from the U.S. Court of Appeals for the D.C. Circuit, which construed the President's authority under the Property Act quite broadly. The Supreme Court has not addressed the question, and there are reasons to doubt whether the D.C. Circuit got this issue right.
Whereas the prior Sixth Circuit opinion tried to distinguish the D.C. Circuit caselaw, Judge Larsen explained why that caselaw did not, and should not, control, as it adopted an unduly expansive notion of the President's authority. As she explains, the federal government's position relies upon assuming the Property Act confers broad authority to pursue the statute's purposes, despite the lack of any such delegation of authority in the law's operative provisions.
The government's statutory arithmetic starts with a fundamental error: It searches for power in a powerless provision. . . . A statutory statement of purpose provides no legal authority. . . . Indeed, just a few terms ago, the Supreme Court unanimously applied this rule, rejecting an assertion by the National Park Service that a statute's "general statement of purpose" could give it power that the Act's operative provisions did not confer. See Sturgeon v. Frost, 139 S. Ct. 1066, 1085–87 (2019). In the end, the government puts up no fight on this front, conceding that § 101 of the Property Act "is not an affirmative grant of authority." Reply Br. at 2. . . .
The operative language in § 121(a) empowers the President to issue directives necessary to effectuate the Property Act's substantive provisions, not its statement of purpose. . . . The text of § 121(a) itself tells us as much. The phrase "carry out" requires a task to be done—something "to put into practice or effect." . . . Yet a purpose provision, on its own, does nothing. . . . True, "carry out" might sometimes refer to a goal rather than a task, but that would be a particularly odd construction of § 121(a). For one thing, that interpretation would be anomalous,if not unprecedented. . . . When asked to provide examples (outside of the Property Act) of a court countenancing an agency's attempt to carry out a purpose provision, in addition to its operative provisions, the government could not provide a single one. More importantly, "no legislation pursues its purposes at all costs," . . . and the Property Act is no exception. Through dozens of operative provisions, Congress chose the means by which to pursue the ends declared in § 101. We decline the government's invitation to construe § 121(a) as authorizing the President to ignore the limits inherent in the Property Act's operative provisions in favor of an "anything-goes" pursuit of a broad statutory purpose. . . .
Even if we were to indulge the government's reliance on the Property Act's declaration of purpose, we would still conclude that the contractor mandate is unlawful. . . . In the government's view, the Act "empowers the President to 'prescribe policies and directives that the President considers necessary' to 'provide the Federal Government with an economical and efficient system' for '[p]rocuring . . . property and nonpersonal services, and performing related functions including contracting.'" Appellant Br. 18 (quoting §§ 101, 121(a)). As the stay panel noted, the most natural reading of this language is that it "authorizes the President to implement systems making the government's entry into contracts less duplicative and inefficient." . . . And the government does not contest that this language—an "economical and efficient system" of procurement—is internally focused, speaking to government efficiency, not contractor efficiency. Recording of Oral Argument at 26:32–26:39 ("We don't dispute the stay panel's conclusion that 'system' points the court's analysis inward."). Yet the government's justifications for the mandate center not on how it would make contracting more efficient, but how it would make contractors more efficient. E.g., 86 Fed. Reg. at 63,422. ("Requiring any workers who have not yet done so to receive a COVID-19 vaccine would generate meaningful efficiency gains for Federal contractors." (emphasis added)).
Judge Larsen also explained why the court rejected reliance upon the D.C. Circuit's broad construction of the President's authority.
Finding no shelter in the statutory text, the government seeks refuge in out-of-circuit caselaw. The leading case is the en banc D.C. Circuit's decision in Kahn, which held that the President did not exceed his powers under the Property Act by ordering federal contractors to comply with wage and price regulations because there was a "sufficiently close nexus" between those regulations and "the values of 'economy' and 'efficiency.'" 618 F.2d at 792. In so holding, the court relied on the Act's declaration of purpose to give content to the textual delegation of authority to the President. Id. at 783–89. That logic, as we have explained, is mistaken. . . . Other cases on which the government relies simply assume that Kahn's analysis was correct. . . .
Indeed, the only other decision to independently adopt the government's reading of the Property Act, Contractors Association, is even less help to the government's case than Kahn. In cataloging the history of executive orders prohibiting discrimination by federal contractors, the court explained that while many of those orders relied on World War II-era defense statutes, two orders issued by President Eisenhower "seem[ed] to be" authorized by the Property Act, even though the President had not invoked that power. 442 F.2d at 170. In one paragraph, and without a single mention of the statutory language, the court concluded that the Property Act authorized two non-discrimination orders because the United States has an interest in reducing costs and delays in procurement. Id. That conclusion, moreover, was dictum. Neither Eisenhower order was before the court, and the order that was before the court involved construction projects in which the federal government merely provided financial assistance, rather than directly procuring the services, so it cannot have rested on the Property Act. See id. at 170–71. Contractors Association's cursory and gratuitous assessment of the Property Act is far too thin a reed on which to rest the contractor mandate.
While the court rejected the federal government's defenses of the contractor mandate, it agreed with the Biden Administration that the lower court's injunction was overbroad insofar as it bound nonparties in the plaintiff states.
We still must decide, however, whether the district court abused its discretion by prohibiting enforcement of the mandate against non-parties in the plaintiff States. We hold that it did.
The parties agree that federal courts should not issue relief that extends further than necessary to remedy the plaintiff's injury. Although a geographically limited injunction like the one issued here does not create all of the practical problems associated with "nationwide" or "universal" injunctions, see Arizona v. Biden, 31 F.4th 469, 484 (6th Cir. 2022) (Sutton, C.J., concurring), affording relief beyond the parties nonetheless raises substantial questions about federal courts' constitutional and equitable powers, see id. at 483; Dep't of Homeland Sec. v. New York, 140 S. Ct. 599, 600 (2020) (mem.) (Gorsuch, J., concurring). We therefore take seriously the federal government's complaint about the overbreadth of the district court's injunction. . . .
Because an injunction limited to the parties can adequately protect the plaintiffs' interests while the case is pending disposition on the merits, the district court abused its discretion in extending the preliminary injunction's protection to non-party contractors in the plaintiff States.
It will be interesting to see whether the Biden Administration files a petition for rehearing en banc or a petition for certiorari.
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