US Judge Rejects Key Part of Obama Healthcare Law

RICHMOND, Va. – A federal judge declared the Obama administration's healthcare law unconstitutional Monday, siding with Virginia's attorney general in a dispute that both sides agree the U.S. Supreme Court ultimately will decide.

U.S. District Judge Henry E. Hudson is the first federal judge to strike down the law, which two others in Virginia and Michigan have upheld. Several other lawsuits have been dismissed and others are pending, including one 20 other states have joined in a Florida filing.

Virginia Republican Attorney General Kenneth Cuccinelli filed a separate lawsuit in defense of a new state law that prohibits the government from forcing state residents to buy health insurance. However, the key issue was his claim that the federal law's requirement that citizens buy health insurance or pay a penalty is unconstitutional.

Hudson, a Republican whom President George W. Bush appointed, sounded sympathetic to the state's case when he heard oral arguments in October, and the White House expected to lose this round.

Administration officials told reporters last week that a negative ruling would have virtually no impact on the law's implementation, noting that its two major provisions — the coverage mandate and the creation of new insurance markets — don't take effect until 2014.

The central issue in Virginia's lawsuit was whether the federal government has the power under the constitution to impose the insurance requirement. The Justice Department said the mandate is a proper exercise of the government's authority under the Commerce Clause.

Cuccinelli argued that, although the government can regulate economic activity that substantially affects interstate commerce, the decision not to buy insurance amounts to economic inactivity that is beyond the government's reach.