Why is Congress still regulating noncommercial activity?

• Author: Kreit, Alex

INTRODUCTION

In popular news media, the United States Court of Appeals for the Ninth Circuit is regularly characterized as left of the mainstream. Fox News commentator Bill O'Reilly once went so far as to say that "many of the federal judges sitting on that bench will not enforce the drug laws because they want legalization of narcotics." (1) The claim might strike some as extravagant rhetoric or the product of an overactive imagination, (2) but it's possible that O'Reilly was actually referencing a real opinion by the Ninth Circuit. In Raich v. Ashcroft, (3) the Ninth Circuit granted a preliminary injunction to prevent the federal government from enforcing the Controlled Substances Act ("CSA") (4) against two medical marijuana patients and their caregivers. Raich, however, is a far cry from the liberal judicial activism Bill O'Reilly made it out to be. In fact, the decision was based on the decidedly conservative Commerce Clause cases United States v. Lopez (5) and United States v. Morrison. (6) The Raich court held that enforcement of the CSA would be unconstitutional as applied to the plaintiffs because they were engaged in purely intrastate, noneconomic activity outside the scope of Congress's Commerce Clause power. (7) The plaintiffs, who manufactured and possessed marijuana but did not engage in its sale, had sued the federal government for a preliminary injunction on Commerce Clause grounds. (8)

The Ninth Circuit's dedicated application of Lopez and Morrison in 2003 was not limited to liberal causes like medical marijuana. (9) They also issued two other important Commerce Clause opinions: the first, United States v. McCoy, overturning a conviction for child pornography possession, (10) and the second, United States v. Stewart, striking a conviction for possession of a machine gun. (11) Judge Alex Kozinski, the Ninth Circuit's leading conservative, (12) authored the Stewart opinion, while McCoy was written by prominent liberal Judge Stephen Reinhardt. (13) Together, the three cases demonstrate a slowly increasing willingness on the part of lower courts to take seriously the Supreme Court's directives in Lopez and Morrison. More importantly, however, these decisions indicate that the "broader scheme" doctrine that has hitherto been almost universally overlooked by scholars (14) will play a fundamental role in determining the limits and meaning of the post-Lopez Commerce Clause.

The doctrine, mentioned only twice in Lopez, allows Congress to regulate activity that is "an essential part of a larger regulation of economic activity, in which the regulatory scheme could be undercut unless the intrastate activity were regulated." (15) What that allows, however, is not entirely clear. Does it mean, for instance, that Congress can regulate gun possession in a school zone (16) if it does so under a regulatory scheme that seeks to eliminate the gun trade entirely, (17) criminalizes gun possession as part of the effort, and tacks on a penalty enhancement for doing it in a school zone for good measure? (18) In other words, does the mere inclusion of an otherwise impermissible regulation in a larger regulatory scheme save it?

Most lower courts have said, in a word, yes. (19) More alarmingly, they have almost uniformly adopted their expansive interpretations without any serious exploration of the broader scheme doctrine's meaning, limits, history, or other possible interpretations. (20) The First Circuit's treatment of the broader scheme issue in its discussion of the Youth Handgun Safety Act ("YHSA") in United States v. Cardoza (21) is instructive. Cardoza challenged convictions related to aiding and abetting juvenile gun possession in violation of the YHSA. (22) In a one paragraph discussion, the First Circuit determined that "the possessory prong of the YHSA" (23) was an essential part of a broader scheme, reasoning that it was part of Congress's effort to regulate supply and demand of handguns:

The YHSA can be thus seen as criminalization of the two points where the prohibited commerce finds its nexus; the demand for the firearms (possession), and the sale or transfer designed to meet that demand. The two prohibitions go hand in hand with one another. Invalidation of one half of the equation would likely have deleterious effects on the efficacy of the legislation. (24) Cardoza, like most lower court opinions on the subject, views the broader scheme doctrine as little more than a truism: if Congress has the power to enact larger scheme X and statute Y is connected to or part of that scheme, then Congress has the authority to enact statute Y. (25)

While that approach certainly has the virtue of simplicity, it is far from clear that it is the method of analysis envisioned by the Lopez court. First, it does not seem to provide for the sort of meaningful limitation on Congressional Commerce Clause power that was central to the Court's opinion in Lopez. (26) The notion that Congress can regulate even the most local, noncommercial, activity simply by including it in a larger scheme might make Congress more careful about how it constructs its regulations, but ultimately does not impact what activities Congress can and cannot regulate. (27) Similarly, the expansive view of the regulatory scheme rule actually creates a perverse incentive for Congress to regulate more broadly than it otherwise would. (28) For example, if Congress wished to regulate a noncommercial activity, it would have an incentive to pass the statute as part of a broader regulatory scheme, thus regulating a swath of activity to protect against challenges to the potentially suspect regulation. If this is a limitation on Congress's Commerce Clause power, it does not appear to be a particularly meaningful one. Moreover, lower courts have almost universally failed to consider the pre-Lopez Supreme Court treatment of the doctrine or other possible interpretations, instead assuming that the language from Lopez was meant to support the most sweeping interpretation. (29)

Scholars, in turn, have assumed the lower courts' interpretation is correct and all but ignored the doctrine. None have explored the doctrine's history in detail, asked whether the current approach is correct, or offered an alternate framework for analyzing broader scheme issues. (30) The one academic article that does focus on the broader scheme doctrine astutely points out that it creates perverse legislative incentives for Congress but limits its analysis to that single point and, in particular, assumes that the expansive lower court readings that creates these incentives is correct. (31) Even in the wake of that article, the broader scheme doctrine remains a "critical passage that has gone largely unnoticed by commentators." (32)

As a result, the broader scheme doctrine has continued to be misunderstood despite its growing importance in Commerce Clause jurisprudence. Prior to Lopez, the concept was justifiably overlooked. For nearly 60 years, Congress's Commerce Clause power seemed almost limitless as the Supreme Court consistently upheld every statute faced with a Commerce Clause challenge that came before it. (33) But in striking down the Gun Free School Zones Act ("GFSZA") of 1990, which made gun possession in a school zone a federal offense, the broader scheme doctrine suddenly gained new significance.

The importance of the broader scheme doctrine has become increasingly clear after Morrison, even as its meaning remains muddled and neglected. Prior to Morrison, lower courts understandably applied Lopez with a great deal of caution as it was unclear whether the decision was an "epochal case" or "only a misstep." (34) After Morrison, however, the broader scheme doctrine became a central issue--perhaps the most important--in defining the scope of federal Commerce Clause power. (35) The primary reason for this is that the broader scheme doctrine is the only doctrine the Supreme Court has recognized that may have the power to save Congressional regulation of noneconomic activity. (36) Lower courts have relied on the broader scheme doctrine in upholding statutes ranging from prohibitions against drug possession, (37) aiding and abetting juvenile handgun possession, (38) and child pornography possession (39) to environmental (40) and endangered species regulations. (41) Indeed, because Lopez defines possession as a noneconomic activity, the broader scheme doctrine is the only doctrine that can save possession-based statutes. (42)

This essay provides the first thorough examination of the broader scheme doctrine and its history, argues that the prevailing interpretation by lower courts is misguided, and proposes a preferable framework for analyzing broader scheme questions. The analysis reveals a fundamental misinterpretation of Wickard's aggregation doctrine (43) as the source of the expansive, purpose-based view. Lower courts have mistakenly read Wickard as a part of the broader scheme doctrine. However, Lopez's treatment of Wickard was meant to limit the aggregation principle to statutes that regulate economic activity, a concept unrelated to the broader scheme doctrine. Instead, cases like Maryland v. Wirtz (44) and Hodel v. Virginia Surface Mining & Reclamation Ass'n (45) are the source of the broader scheme doctrine. These cases show a doctrine based on the enterprise theory, which allows for an analytical framework that conforms to the mandates of Lopez and Morrison.

Section I contains a brief overview of the Supreme Court's substantial effects Commerce Clause jurisprudence. Section II reviews lower courts' treatment of the broader scheme doctrine and the implications of their adopted approach. Section III considers the Supreme Court case law on the broader scheme doctrine and the source of the expansive interpretation adopted by the lower courts. Section IV proposes an approach to the broader scheme doctrine, based on the enterprise concept, which addresses the problems of...