5th Cir Upholds Preemption Claim Without 1983 "Rights"

March 15, 2005 5th Cir Upholds Preemption Claim Without 1983 "Rights" The Fifth Circuit has held that plaintiffs may use a preemption claim to enjoin a state law that conflicts with federal law, even if the federal law does not give the plaintiff any “rights” that would be enforceable under 42 U.S.C. § 1983.

Planned Parenthood v. Sanchez, No. 03-50930, ---F.3d---, 2005 WL 579912 (5th Cir. Mar. 11, 2005). The opinion has a very helpful discussion of the existence of the preemption cause of action to enjoin state laws that conflict with federal law; the use of preemption to enforce Spending Clause statutes; the irrelevance of section 1983 “rights” under Gonzaga University v. Doe, 536 U.S. 273 (2002); and the use of preemption to enforce federal regulations.

The decision is more equivocal on the merits of the preemption claim, both on these facts and in general regarding conflict preemption challenges to state eligibility rules.The court also hinted in a footnote that, though bound by precedent, the panelists (Higginbotham, joined by Dennis and Clement) agree with the minority views of Justices Scalia and Thomas that preemption should not be available for Spending Clause statutes.

Facts/ruling on merits.

The plaintiffs, providers of abortion services, challenged a Texas budget rider that prevented plaintiffs from receiving federal family planning funds even if those funds were not used for abortion services. The court found that the budget rider could be interpreted to permit plaintiffs to form affiliates for the abortion services. The court reversed the preliminary injunction and remanded for a trial on the merits to determine how much of a burden forming affiliates would entail.

Preemption cause of action.

The court summarized Supreme Court and lower court decisions and had “little difficulty in holding that Appellees have an implied right of action to assert a preemption claim seeking injunctive and declaratory relief” on the grounds that the budget rider conflicts with federal law. The court did not resolve the source of the cause of action. In a lengthy footnote (47), it summarized “one school of thought [that] holds that the Supremacy Clause itself creates an implied cause of action,” whereas “[a]nother possible source is the Declaratory Judgment Act.”

Use of preemption for Spending Clause statutes.

The opinion also has an extensive discussion of the use of preemption claims under the Supremacy Clause to enforce Spending Clause statutes, going back to the welfare cases of the 1960s and 1970s starting with King v. Smith, 392 U.S. 309 (1968), and up to the recent Medicaid case, Pharmaceutical Res. & Mftrs. v. Walsh, 538 U.S. 344 (2003). Although “courts often proceed without invoking ‘preemption’” (as in King, citing the Supremacy Clause alone), the “growing consensus, however, is to analyze such claims under traditional preemption doctrine.” Previously, the Fifth Circuit had “decided the question of whether state law conflicted with federal Spending Clause legislation” without directly addressing “whether a valid cause of action existed …. Today we hold that one does.”

More ominously, however, the court indicated that it was bound by authority but disagreed with its own conclusion. In a footnote (34), the court quoted the opinions of Justices Thomas and Scalia in Pharmaceutical Research, who espoused the view that preemption cannot be used to enforce Spending Clause legislation. “These arguments have great purchase …; however, their persuasive force is wasted on the inferior courts. Rather, they must persuade at least three other Justices.”

Irrelevance of section 1983 “rights.”

The opinion also has a good discussion of the caselaw showing that “an implied right of action to seek injunctive relief from a state statute purportedly preempted by federal Spending Clause legislation … does not require a showing, as per Gonzaga, that a § 1983 action would also be proper.” Earlier in the opinion, the court also indicated that the claim exists “even absent an explicit statutory claim” (citing cases in footnote 46).

Using preemption to enforce regulations.

The opinion cites established Supreme Court caselaw that “[f]ederal regulations have no less preemptive effect than federal statutes,” and indicates in footnote 80 that regulations are entitled to the normal deference to the administering agency.

Problems on the merits of conflict preemption claim.

Turning to the merits, a “’modest impediment’ to eligibility for federal funds does not provide a sufficient basis for preemption. However, a state eligibility standard that altogether excludes entities that might otherwise be eligible for federal funds is invalid under the Supremacy Clause.” The court did not decide which category better describes the budget rider, as interpreted to allow plaintiffs to form affiliates: “either the affiliate requirement is a relatively empty formalism or it is a more substantial obstacle. The former is permissible, while the latter likely is not.”

The court’s summary of the caselaw is fairly accurate, and the burden of forming affiliates certainly sounds more like a “substantial obstacle” than an “empty formalism.” However, the court hinted at a contrary outcome. The state law should be upheld unless the plaintiffs “can show that the burden of forming affiliates in forthcoming years would in practical terms frustrate their ability to receive federal funds …. While creating affiliates might entail some time and expense, and might not be the most convenient arrangement, this extra effort alone would not relegate the state statute to preemption.”