Is the Anti-Injunction Act Jurisdictional?

December 15th, 2013

One of the most frustrating aspects of NFIB v. Sebelius for FedCourts nerds is that the Court did not resolve the question of whether the Tax Anti-Injunction Act was jurisdictional. If the Act was not jurisdictional, then the government could waive it (as it tried to do), and the Court could hear the case in 2012. If the Act was jurisdictional, then the government could not waive it as a defense (even if they tried to), and the Court could not hear the case till 2014 when the ACA is enforced. But, because the Chief Justice’s saving construction held that it was *not* a tax for purposes of the Anti-Injunction Act, there was no jurisdictional problem (even though it *was* a tax for purposes of the Constitution). Anyway, the Court ducked the issue of whether the AIA was jurisdictional. So, is it jurisdictional?

Erin Hawley (who was my FedCourts prof) has a new article, titled “The Equitable Anti-Injunction Act of 1867” that looks at this question. Here is the abstract:

There is a law for tax law alone – at least in the enforcement context. The puzzle is this: Preenforcement challenges to statutes and regulations are generally allowed in the law. But not for taxes. This is all because of the Anti-Injunction Act of 1867 (“AIA”), which bars a taxpayer who believes a tax to be invalid from bringing a preemptive suit.

The deeply imbedded conventional wisdom is that the Anti-Injunction Act is jurisdictional. If this is correct, the current myriad measures of tax penalties designed to encourage certain behaviors are all but immune from preenforcement challenge. Taxpayers subject to an unconstitutional tax have two choices only: comply with the (invalid) regulation or pay the tax and institute a refund action.

But what if the Anti-Injunction Act is not jurisdictional? This Article argues that the conventional wisdom is wrong because it does not account for the Supreme Court’s recent caselaw regarding when a condition is jurisdictional and because it ignores early case law suggesting that the AIA was meant to govern equity jurisdiction. Part I examines the judicial and scholarly consensus that the AIA is jurisdictional. Part II analyzes the Supreme Court’s recent jurisdictional decisions. Part III applies those precedents to the Anti-Injunction Act and argues that the Act is not jurisdictional. Part IV explains that a proper interpretation of the Act must account for the equitable rules that governed tax injunction suits at common law and for the Supreme Court’s early interpretation of that statute. This leads to a surprising and novel interpretation: the Anti-Injunction Act of 1867 governs the equitable jurisdiction of the federal courts. Part V develops briefly the scope of an equitable Anti-Injunction Act, sketching out categories of cases in which preenforcement review might be available.

Erin suggests that NFIB viewed the AIA as jurisdictional:

Since the AIA did not apply, the Supreme Court had no occasion to con- sider whether the Act is jurisdictional, but the tenor of its opinion suggests that, were the question presented, it would view the Act through a jurisdic- tional lens.39 “Before turning to the merits,” the Court wrote in assessing the AIA, “we need to be sure we have the authority to do so.”40 The Court’s suggestion that the AIA implicates the adjudicatory authority of the federal court is in line with previous cases in which the Supreme Court has referred to the AIA as “jurisdictional.”