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ARGUMENT OF MICHAEL A. CARVIN, ON BEHALF OF THE PETITIONERS

Chief Justice John Roberts: We'll hear argument this morning in Case 14-114, King v. Burwell. Mr. Carvin.

Michael A. Carvin: Mr. Chief Justice, and may it please the Court: This is a straightforward case of statutory construction where the plain language of the statute dictates the result.

Justice Ruth Bader Ginsburg: Mr. Carvin, will you please back up, because before we get to a question of statutory construction, as you know, each plaintiff, or at least one plaintiff, has to have a concrete stake in these questions.

They can't put them as ideological questions. And we have as -- four plaintiffs.

As to two of them, there is a declaration stating "I am not eligible for health insurance from the government," but there's a question of whether they are veterans eligible for coverage as veterans.

Michael A. Carvin: Yes.

One of those is Mr. Hurst who would have to, if -- I would refer you to Joint Appendix at PAGE 42, where this is the government's recitation of facts where they make it clear that Mr. Hurst would have to spend $750 of his own money as a -- because of the IRS rule. Mr. Hurst was a veteran for 10 months in 1970.

He is not eligible for any veterans service because if you've served such a short -- health services.

If you serve such a short --

Justice Ruth Bader Ginsburg: I -- I'll ask the government if they agree that --

Michael A. Carvin: And I should point out that the government has never disputed this, and I'd also like --

Justice Ruth Bader Ginsburg: But the Court has an obligation to look into it on its own.

Michael A. Carvin: That's true, but of course there has been fact-finding by lower courts in an adversarial system.

I don't believe the Court does its own --

Justice Ruth Bader Ginsburg: I don't think it was ever brought up in the lower court that these -- these two people were veterans.

Michael A. Carvin: If I could just make one further point on this, Justice Ginsburg.

Even if he were technically eligible, which he is not, there is an IRS Rule 26 C.F.R. 1.36B-2(c)(ii), which says --

Justice Antonin Scalia: Ah, yes.

Michael A. Carvin: With the usual clarity of the IRS code, making clear that you are only disabled from receiving subsidies if you have actually enrolled in a veteran's health services and it's undisputed that --

Justice Ruth Bader Ginsburg: That's the government that's --

Michael A. Carvin: -- Mr. Hurst did not.

Justice Ruth Bader Ginsburg: -- that's deposition to. And then there were the two women, I think one of them was going to turn 65 in June, which would make her Medicaid-eligible.

Michael A. Carvin: She will turn 65 in late June. She's obviously subject to the individual mandate well in advance of that.

By virtue of the IRS rule, she would have to spend $1800 per year for health insurance by virtue of the IRS --

Justice Ruth Bader Ginsburg: Per year?

Michael A. Carvin: Excuse me?

Justice Ruth Bader Ginsburg: But you said she will turn 65 in June.

Michael A. Carvin: Late June, yes.

Justice Ruth Bader Ginsburg: So that takes care of 2015.

Michael A. Carvin: No.

Right now she is obliged under the individual mandate to have insurance.

You -- you have to have insurance for 9 months of the year and so as of April 1st --

Justice Ruth Bader Ginsburg: Then --

Michael A. Carvin: -- she will be subject to the penalty which will be alleviated only by --

Justice Ruth Bader Ginsburg: Again, I'll ask the government if they agree with you on that. And then I think for the fourth plaintiff, there's a question whether she would qualify for a hardship -- hardship exemption from the individual mandate even if she received the tax credit, in which case the tax credits would be irrelevant.

Michael A. Carvin: That's true.

Again, I'll refer you to the Joint Appendix at 41.

That was the government's argument below.

We didn't want to get into a factual dispute about it because we had such clear standing with respect --

Justice Ruth Bader Ginsburg: Yeah, but you have to --

Michael A. Carvin: -- to --

Justice Ruth Bader Ginsburg: But you would have to establish the standing, prove the standing.

Michael A. Carvin: Well, as --

Justice Ruth Bader Ginsburg: If this gets beyond the opening door.

Michael A. Carvin: Fair enough, Your Honor, but -- but it's black-letter law that only one plaintiff needs standing, and for the reasons I've already articulated, both Plaintiff Hurst and Plaintiff Levy have.

Justice Ruth Bader Ginsburg: Okay.

I don't want to detain you on this any more but I will ask the government what their position is on standing.

Michael A. Carvin: Thank you. Returning to the merits, the only provision in the Act which either authorizes or limits subsidies says, in plain English, that the subsidies are only available through an exchange established by the State under Section 1311.

Justice Stephen Breyer: If you're going to elaborate on that, I would appreciate your -- in your elaboration, I've read that, and this statute is like the tax code more than it's like the Constitution. There are defined terms, and the words you just used concern a defined term. As I read the definition, there's a section, Definitions, and it says, quote, The term "Exchange" means, quote, an exchange established under 1311.

And 1311 says, An Exchange shall be a government agency, et cetera, that is established by a State.

Those are the definitions. So then you look to 1321.

And 1321 says, if a State does not set up that Exchange, then the Federal, quote, secretary shall establish and operate such Exchange. So it says, "The Secretary is to establish and operate such Exchange," the only kind of Exchange to which the Act refers, which is an -- quote, "an Exchange established by a State under 1311." That's the definition. So the statute tells the Secretary, set up such Exchange, namely, a 1311 State Exchange.

Michael A. Carvin: Correct.

Justice Stephen Breyer: And there's nothing else in this statute.

Michael A. Carvin: Correct.

Justice Stephen Breyer: So that's throughout what they're talking about.

So what's the problem?

Michael A. Carvin: As Your Honor just said, it tells the Secretary to establish such Exchange.

Justice Stephen Breyer: Yes.

Michael A. Carvin: And what 36B turns on is whether the State or the Secretary has established the Exchange.

Justice Stephen Breyer: No, it uses the same terminology that it's used in -- 15 times in this statute, namely, the terminology in the definition is "an Exchange established by a State."

Michael A. Carvin: Under --

Justice Stephen Breyer: That's the phrase.

Michael A. Carvin: Well, under 1311, that is the phrase.

And if 1311 created some -- the definitional section created some ambiguity as to whether HHS was establishing a 1311 or 1321 Exchange, that is immaterial because 36B does not say all 1311 Exchanges get subsidies, it says Exchanges established by the State under Section 1311 --

Justice Elena Kagan: Mr. Carvin.

Michael A. Carvin: -- not established by HHS under Section 1311 --

Justice Elena Kagan: Mr. Carvin.

Michael A. Carvin: -- so it eliminates any potential ambiguity created by the definitional section.

Justice Elena Kagan: Can -- can I offer you a sort of simple daily life kind of example which I think is linguistically equivalent to what the sections here say that Justice Breyer was talking about? So I have three clerks, Mr. Carvin.

Their names are Will and Elizabeth and Amanda.

Okay? So my first clerk, I say, Will, I'd like you to write me a memo.

And I say, Elizabeth, I want you to edit Will's memo once he's done.

And then I say, Amanda, listen, if Will is too busy to write the memo, I want you to write such memo. Now, my question is: If Will is too busy to write the memo and Amanda has to write such memo, should Elizabeth edit the memo? (Laughter.)

Michael A. Carvin: If you're going to create moneys to Will for writing the memo and Amanda writes the memo and you say, the money will go if Will writes the memo, then under plain English and common sense, no, when Amanda writes the memo --

Justice Elena Kagan: Gosh --

Michael A. Carvin: -- but now --

Justice Elena Kagan: -- you -- you run a different shop than I do if that's the way -- (Laughter.)

Justice Elena Kagan: Because in my chambers, if Elizabeth did not edit the memo, Elizabeth would not be performing her function.

In other words, there's a -- a substitute, and I've set up a substitute.

And then I've given -- I've given instructions: Elizabeth, you write -- you edit Will's memo, but of course if Amanda writes the memo, the instructions carry over.

Elizabeth knows what she's supposed to do.

She's supposed to edit Amanda's memo, too.

Michael A. Carvin: And -- and in your chambers, you're agnostic as to whether Will, Elizabeth or Amanda writes it.

But the key point is here under Section 1311, Congress was not agnostic as to whether States or HHS established the Exchange.

It's --

Justice Samuel Alito: Well, Mr. Carvin, if I had those clerks, I had the same clerks -- (Laughter.)

Justice Samuel Alito: -- and Amanda wrote the memo, and I received it and I said, This is a great memo, who wrote it? Would the answer be it was written by Will, because Amanda stepped into Will's shoes?

Michael A. Carvin: That was my first answer. (Laughter.)

Justice Elena Kagan: He's good, Justice Alito.

Michael A. Carvin: Justice Kagan didn't accept it, so I'm going to the second answer, which is you are agnostic as between Will and Amanda, but this --

Justice Elena Kagan: Ah, but that's --

Michael A. Carvin: But Congress was not agnostic as between State and Federal Exchanges.

Justice Elena Kagan: Yes.

That's a very important point, I think, because what you're saying is that the answer to the question really does depend on context, and it depends on an understanding of the law as a whole and whether they were agnostic.

I agree with tha