DOJ Memo: Solicitor General Kagan ‘Substantially Participated’ in Obamacare-Related Case

Terence P. Jeffrey | December 13, 2011 | 2:16pm EST
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President Barack Obama and Elena Kagan. (AP Photo/Charles Dharapak)

( - On July 13, 2010, the Republicans on the Senate Judiciary Committee sent then-Solicitor General Elena Kagan a series of written questions examining the issue of how she would handle recusing herself from cases she might have been involved in as solicitor general if she were confirmed to the Supreme Court.

"Notably, we are concerned about the standard you would use to decide whether to recuse yourself from litigation you participated in as Solicitor General," the senators wrote. "In particular, we are concerned about litigation that was clearly anticipated, but had not yet ... reached the point where your approval was sought for filings or pleadings."

Among other things, the senators asked Kagan if she had ever been asked her opinion regarding the merits, or underlying legal issues, in Florida’s lawsuit challenging the Patient Protection and Affordable Care Act (PPACA)—otherwise known as Obamacare.

In her written responses, Kagan answered: “No.”

Then they asked her a more sweeping question: “Have you ever been asked your opinion regarding any other legal issues that may arise from Pub. L. No. 111-148?” (Pub. L. No. 111-148 is the Obamacare law.)

Kagan again answered: “No.”

Exactly two months before the Judiciary Committee Republicans asked Kagan these questions, however, her top deputy, Neal Katyal, had written her a memo informing her that she had “substantially participated” in Golden Gate Restaurant Association v. San Francisco—a case that Kagan’s own office tied to Obamacare.

(The Justice Department released this memo to on March 15 of this year in response to a Freedom of Information Act request—but only after the Media Research Center,’s parent organization, and Judicial Watch had filed lawsuits demanding release of the material.)

On May 28, 2010, 15 days after Katyal sent Kagan this memo informing her that she had “substantially participated” in the Golden Gate case--and a month before Kagan’s Supreme Court confirmation hearings started--Kagan’s office submitted a 26-page brief to the Supreme Court in the case. The brief cited PPACA by name 12 times and referred to it more generally as “the federal legislation” or “the new federal legislation” an additional 6 times.

Additionally, the brief cited the Health Care and Education Reconciliation Act (HCERA), the reconciliation bill enacted with PPACA, 7 times.

But it was not merely the number of times the brief cited PPACA that tied it to Obamacare.

The brief argued that the issue in the Golden Gate case—whether a universal health care plan enacted by the City of San Francisco should be thrown out because it was preempted by the federal Employee Retirement Income Security Act—should not be taken up by the Supreme Court at that time because the full federal regulatory framework in which that question could be properly answered could only be seen once all the new regulations needed under Obamacare had been written by the federal agencies responsible for them.

One passage on page 14 and 15 of the brief illustrates the argument—made by Elena Kagan’s office--that the Golden Gate case and PPACA were inseparably intertwined.

“The preemption issue does not warrant this Court’s review at this time for the same reasons that the Department of Labor has determined not to take regulatory action on the issue at this time,” the brief told the Supreme Court.

“First, the new federal health care legislation contains numerous provisions designed to promote broader access to health care coverage,” said the brief. “Those provisions include an employer shared responsibility provision that imposes assessments on employers with 50 or more fulltime equivalent employees that do not provide health insurance to their employees if any full-time employee receives a premium tax credit in new health insurance exchanges. See PPACA § 1513, as amended by HCERA § 1003. The legislation also includes a requirement that non-exempted individuals maintain a minimum level of health insurance or pay a penalty. See PPACA § 1501, as amended by HCERA § 1002. And the legislation provides for automatic enrollment of employees in group health plans offered by large employers, PPACA § 1511, and contains several other provisions designed to make health care coverage more affordable and available, e.g., id. § 1401, as amended by HCERA § 1001 (premium assistance tax credits); PPACA § 1402, as amended by HCERA § 1001 (reduced cost-sharing); PPACA § 1421 (small business tax credits); and id. § 1311 (state-based insurance exchanges).

“Many of the new provisions will be phased in over several years, and three different federal agencies—the Department of Health and Human Services, the Department of the Treasury, and the Department of Labor—will be promulgating regulations implementing the provisions,” the brief prepared by Kagan’s office told the court. “The full contours and effects of many aspects of the new federal framework therefore remain to be fleshed out.”

In the days immediately after President Barack Obama nominated Kagan to the Supreme Court, Edwin S. Kneedler, the deputy solicitor general handling the Golden Gate case twice alerted Kagan’s top deputy, Katyal, about the connection between it and PPACA and that Kagan had been involved in the case.

At 1:23 pm on May 11, 2010, the day after Obama announced he was nominating Kagan to the court, Katyal sent an email to Kneedler and Malcolm L. Stewart, another deputy solicitor general.

“As I understand it, Elena is going to recuse from all new cases,” Katyal said. “Are there any CVSGs [calls from the Supreme Court for the views of the solicitor general] you have due by cutoff in which she has not participated at all (either in meetings, phone calls, discussions with you, etc.)? She has participated in all of mine, what about yours?”

Five minutes later, at 1:28 pm, Kneedler responded to Katyal. “The Golden Gate case presents special considerations because of the possible nexus to the Health Care bill,” Kneedler wrote. “I think I did have some minimal discussions with her about that case.”

The next day, at 9:53 am, Katyal sent an email to all of Kagan’s deputy solicitor generals, including Kneedler. “From now on, until the outcome of her pending confirmation hearing, Elena will not be participating in new cases,” Katyal wrote. “All opps, appeal recs, etc., will not have her name on them, and [redacted text] we should use my name as Acting SG.”

Katyal went on to say that Kagan might sign the briefs on cases in which she was already involved. He wanted a listing of those.

“There is a small universe of cases in which Elena has substantially participated already (this includes CVSGs where she chaired meetings, etc.),” Katyal continued. “As to those cases, she very well may sign the briefs. With this email, I’d ask each Deputy sometime today to send me a full list of cases that you think fall into that category. Exclude matters in which you have had short conversations with her. This isn’t a list regarding her recusals at the Supreme Court should she be confirmed; rather it is a list for her so that she knows what cases she might be signing briefs in.”

That evening at 6:31 pm Kneedler emailed his list of such cases to Katyal.

The paragraph in this email in which Kneedler mentions the Golden Gate case has been partially redacted by the Justice Department. It said: “Golden Gate --  I discussed with Elena several times [here about one full line of text is redacted] Especially now that health care has passed, she may not want to be involved in that brief.”

What was in the redacted text immediately proceeding Kneedler’s statement that “now that health care has passed” Kagan “may not want to be involved in that brief”?

(Kneedler’s email contains a similar bloc of redacted text in his subsequent discussion of a case--Montana v. Wyoming--a couple of paragraphs deeper into the email.)

In an affidavit that the Justice Department submitted to the federal court in the FOIA lawsuit brought by the MRC, DOJ explains the redactions in this email: “The redacted information contains DOJ attorneys’ thoughts on the formulation of the government’s litigation position in two cases that were pending before the United States Supreme Court and internal legal analysis.”

Five weeks before Kneedler sent this email informing Katyal that he had discussed the Golden Gate case with Kagan “several times,” Kagan herself had sent Kneedler an email inquiring about the case.

On April 2, 2010, ten days after President Obama signed PPACA into law, Kagan sent Kneedler the email under the subject line “Cvsgs.”  “Ed,” she said, “could you give me time of arrival on [name redacted] and [name redacted]? Thanks. Elena.”

The names redacted here were apparently those of lawyers working under Kneedler’s direction on CVSG briefs requested by the Supreme Court.

In his response, Kneedler told Kagan: “[Name redacted] said he thought he could get the draft in Golden Gate to me by early the week after next. [Here approximately five lines of text have been redacted from the email.]”

Kagan then emailed back to Kneedler: “Ok, let me know.”

What was in this approximately five lines of text redacted from Kneedler’s paragraph to Kagan about the Golden Gate case—in an email sent ten days after PPACA became law?

The affidavit the Justice Department submitted to the federal court explaining the redaction said: “The redacted information includes a DOJ attorney’s thoughts on specific legal arguments and strategies relevant to one of the cases cited in the email exchange.”

On May 13, two days after Obama nominated Kagan to the court and after Katyal had queried Kagan’s deputies about the cases she had worked on with them, Katyal wrote Kagan a memorandum. The subject line on the memorandum said: “CURRENT CASES THAT YOU HAVE WORKED ON”

“The below contains a list of cases in which we feel that you have substantially participated,” Katyal told Kagan. “We have not done an exhaustive search, so this should not be used for deciding recusals, should you be confirmed. It is simply a document that you may use to guide your decisions about which cases to participate in pending your nomination.”

Under the subheading “Ed”—for Deputy Solicitor General Ed Kneedler—Katyal’s memo said: “Golden Gate  Ed discussed with Elena several times [Here about a line and a quarter has been redacted from the text by the Justice Department.]”

(As in Kneedler’s email to Katyal on the matter, there is a similar redaction in Katyal’s discussion of the Montana v. Wyoming case in his memo to Kagan.)

What did DOJ remove with these redactions?

The DOJ affidavit submitted to the federal court explaining the redactions said: “The redacted information contains a DOJ attorney’s thoughts on the formulation of the government’s litigation position in two cases that were pending before the United States Supreme Court.”

Fifteen days after Katyal sent his memo to Kagan, the Office of Solicitor General submitted its brief in the Golden Gate case to the Supreme Court. The brief was not signed by Kagan, but by Katyal, Kneedler, Assistant to the Solicitor General Matthew Roberts, and four attorneys from the Labor Department.

“As discussed above,” the brief concluded, “the intervening enactment of comprehensive federal health care legislation has dramatically changed the landscape governing payment for health care, substantially reducing the importance of the question whether ERISA preempts state or local requirements and also giving rise to additional legal issues that have not been addressed by the federal Departments responsible for implementing the new legislation or by the courts. Accordingly, this Court’s review of the ERISA preemption issue is not warranted at this time.”

So, in the redacted email exchange and the “several” discussions that Deputy Solicitor General Kneedler had with his boss, Elena Kagan, about this case, did he ever discuss its connection to PPACA?

This week, sent Kneedler via email a PDF file of the documents that DOJ had released as a result of’s FOIA request. asked Kneedler: “During the time that Elena Kagan was solicitor general, did you ever have any verbal or written communications with her about any connection between the Patient Protection and Affordable Care Act and the Golden Gate Restaurant Association case? If you did have such a communication or communications, when did it occur, what did you say and what did she say?” sent Kneedler this question via email on the afternoon of Dec. 12 and again on the afternoon Dec. 13. Also, on the afternoon of Dec. 12, left a voice mail message for Kneedler about the question.

Kneedler has not responded. also sent former Acting Solicitor General Katyal a PDF file of the FOIA documents released by DOJ. On Dec. 12 and Dec. 13, asked Katyal this question via email: “Do you have any reason now to doubt the accuracy of this May 13, 2010 memorandum in which you informed then-Solicitor General Kagan that she had ‘substantially participated’ in the Golden Gate case?”

Katyal has not responded.’s FOIA request, initially filed on May 25, 2010, asked for any communications involving Elena Kagan in which the administration’s health care reform plan was a topic, or legal challenges to the health-care law signed by President Obama was a topic, or “in which the question of whether Solicitor General Elena Kagan ought to recuse herself from any involvement in any particular case in her role as solicitor general due to the prospect that it might later come before her were she to be confirmed to a seat on the federal court was discussed.”

In preparing its response to this request, DOJ told the federal court it searched the files of Elena Kagan, Neal Katyal, and Kagan’s confidential assistant. DOJ did not search the files of Kagan’s other deputies, including Kneedler.

In its FOIA lawsuit on the matter, Judicial Watch (JW) challenged DOJ’s decision not to search the files of the other deputies for relevant documents.

In an opinion released on Oct. 13, U.S. District Judge Ellen Huvelle, a Clinton appointee, ruled in favor of DOJ on this issue. “JW argues that the search was not adequate because OSG determined to search the files and emails of SG Kagan, her confidential assistant, and then-Principal Deputy Solicitor General Katyal, but did not search the records of the other deputies in the OSG,” wrote Judge Huvelle.

“However,” the judge concluded, “this does not render the search inadequate where, as here, DOJ has demonstrated that its decision to search the files of these three individuals was reasonably calculated to uncover relevant documents.”

On July 6, House Judiciary Chairman Lamar Smith sent a letter to Attorney General Eric Holder asking Holder for DOJ documents and interviews—including one with Neal Katyal—so the committee could “properly understand any involvement by Justice Kagan in matters relating to health care legislation or litigation while she was solicitor general.”

In this letter, Chairman Smith pointed to two other questions the Senate Judiciary Committee Republicans had asked Kagan in their letter probing the recusal issue.

“During her Senate confirmation, then-Solicitor General Kagan answered ‘no’ when questioned about whether she had ever been ‘asked about [her] opinion’ or ‘offered any views or comments regarding the underlying legal or constitutional issues related to any proposed health care legislation … or … potential litigation resulting from such legislation,’” Smith wrote. “Yet, documents released by the Department in response to recent Freedom of Information Act requests raise questions about that unequivocal denial.”

The Justice Department has refused to comply with the House Judiciary Committee’s request.

Testifying before the committee last week, Attorney General Holder could not cite a legal privilege to justify his department’s refusal to comply with this congressional oversight request.

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