A fifth of all American workers work for companies with federal contracts. The Biden administration tried to use those federal contracts as leverage to order those companies to require that all of their millions of workers be vaccinated. In a 2-to-1 ruling along party lines, a federal appeals court has just blocked that vaccination order. It ruled that the Federal Property and Administrative Services Act doesn’t give Biden that power.
Judge John Bush wrote the court’s ruling in Commonwealth of Kentucky v. Biden, joined by Judge Richard Suhrenreich. Judge Guy Cole dissented. Judge Bush wrote:
In 1949, Congress passed a statute called the Federal Property and Administrative Services Act (“Property Act”) to facilitate the “economical and efficient” purchase of goods and services on behalf of the federal government. See 40 U.S.C. § 101. The Property Act serves an uncontroversial purpose; who doesn’t want the government to be more “economical and efficient”? Yet that laudable legislative-branch prescription, in place for the last seventy years, has recently been re-envisioned by the executive. In November 2021, the Safer Federal Workforce Task Force, under the supposed auspices of the Act, issued a “Guidance” mandating that the employees of federal contractors in “covered contract[s]” with the federal government become fully vaccinated against COVID-19. That directive sweeps in at least one-fifth of our nation’s workforce, possibly more. And so an act establishing an efficient “system of property management,” S. Rep. 1413 at 1 (1948), was transformed into a novel font of federal authority to regulate the private health decisions of millions of Americans.
In response, three states (Ohio, Kentucky, and Tennessee) and two Ohio sheriffs’ offices filed suit. They collectively alleged that nothing in the Property Act authorizes the contractor mandate, that the contractor mandate violates various other federal statutes, and that its intrusion upon traditional state prerogatives raises serious constitutional concerns under federalism principles and the Tenth Amendment. The district court agreed. It enjoined enforcement of the contractor mandate throughout Ohio, Kentucky, and Tennessee. It also denied the subsequent motion of the federal-government defendants to stay the injunction pending appeal. The government now comes to us with the same request. But because the government has established none of the showings required to obtain a stay, we DENY such relief.
As law professor Jonathan Adler notes,
I think the argument that the Biden Administration is stretching the federal government’s authority over federal contractors has a fair amount of force. The problem is that most of the caselaw construing the federal Property Act has adopted a very expansive and permissive interpretation of the executive branch’s authority. The relevant decisions are all from other lower courts, so it is not controlling, but I am not sure they are as easily distinguished as Judge Bush suggests. I might be more inclined to say that D.C. Circuit decisions such as Kahn and Chao are simply wrong, insofar as they enable the executive branch to transform a procurement law into a powerful lever for regulating large portions of the national economy. (Of note, in the Chao case — in which the federal government ordered federal contractors to inform their workers of their rights not to join unions or pay dues — it was conservatives who championed a broad reading of the Property Act, and liberals who dissented.)
Liberal Judge Cole dissented from the decision, rejecting both the majority’s interpretation of the statute, and its ruling that the state plaintiffs had standing to sue over their claims. His short dissent begins as follows:
I disagree with the majority’s conclusion that both the states and the sheriffs’ offices have standing. I also disagree with the conclusion that the President “re-envisioned” the Federal Property and Administrative Services Act (“Property Act”) to take the actions contemplated by Executive Order No. 14042. Maj. Op. 2. I recognize that the Eleventh Circuit recently declined to stay the national injunction imposed by Georgia v. Biden, — F. Supp. 3d —, No. 1:21-CV-163, 2021 WL 5779939, (S.D. Ga. Dec. 7, 2021). See Georgia v. Biden, No. 21-14269, slip op. at 1 (11th Cir. Dec. 17, 2021). Even still, I find that the government has made a “strong showing” in this case that it will prevail on the merits and has established that it will suffer irreparable harm without a stay. See Nken v. Holder, 556 U.S. 418, 426 (2009). For these reasons, I dissent.
As Professor Adler notes, “Kentucky v. Biden is one of several pending challenges to the federal contractor mandate (which is not to be confused with the CMS mandate for Medicare and Medicaid providers or the OSHA vaccine-or-test ETS, both of which will be considered by the Supreme Court on Friday). In this case, the lower court only issued an injunction in the plaintiff states. In one of the parallel cases, however, a district court entered a nationwide injunction against the vaccine requirement for federal contractors, and the U.S. Court of Appeals for the Eleventh Circuit refused to stay that order, but ordered expedited briefing on the merits.”