# Opposition Brief — Golden Gate Restaurant Ass'n v. City & County of San Francisco > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386017_0619%3A02 ## Record - **Collection:** Supreme Court brief - **Document type:** Opposition Brief - **Published:** January 1, 2010 - **Citation:** 561 U.S. 1024 ## Text Supreme Court, U.S. rIiLED AUG 2 4 2009 OFFICE OF THE CLERK Sn The Supreme Court of the United States ¢ GOLDEN GATE RESTAURANT ASSOCIATION, Petitioner, V. CITY AND COUNTY OF SAN FRANCISCO, Respondent, SAN FRANCISCO CENTRAL LABOR COUNCIL; SERVICE EMPLOYEES INTERNATIONAL UNION (“SEIU”), LOCAL 1021; SEIU UNITED HEALTHCARE WORKERS-WEST; and UNITE HERE! LOCAL 2, Intervenors/Respondents. « On Petition For Writ Of Certiorari ‘To The United States Court Of Appeals For The Ninth Circuit * BRIEF FOR RESPONDENT IN OPPOSITION @ PAUL R.Q. WOLFSON DENNIS J. HERRERA WILMER CUTLER PICKERING City Attorney HALE AND DORR LLP WAYNE SNODGRASS 1875 Pennsylvania VINCE CHHABRIA Avenue, NW Counsel of Record Washington, D.C. 20006 CHRISTINE VAN AKEN Telephone: (202) 663-6390 Deputy City Attorneys Facsimile: (202) 663-6363 City Hall, Room 234 One Dr. Carlton B. Goodlett Place San Francisco, CA 94102 Telephone: (415) 554-4674 Facsimile: (415) 554-4747 Attorneys for Respondent COCKLE LAW BRIEF PRINTING CO (800) 225-6964 OR CALL COLLECT (402) 342-2831 QUESTION PRESENTED San Francisco’s universal health care ordinance contains two interlocking components: a comprehen- sive public health care program available to all uninsured residents at sliding scale fees, and a gen- eral health care spending requirement for medium and large employers. Employers may comply with the spending requirement either through their own health care plans, or by paying into the public program. If employers choose the public option, their employees receive a substantial discount on the health care services available through that program. The question presented is: Does ERISA preempt the _ portion of San Francisco’s universal health care ordinance that imposes a general health care expenditure require- ment on medium and large employers, where every employer may readily comply without adopting an ERISA plan or altering an existing plan, and where the option of paying into the public program is a rational choice for employers rather than a penalty? TABLE OF CONTENTS QUESTION PIRES 2 EW)... .00ccecesssccsscccnssseesssesoees py TOF Bele veyed) yy |: ener rere a 5 ies orc bn ndenn iho dank det nents suindeeciveveesesens A. B. The Health Care Security Ordinance........ FUDCOGUIGS TENG OTG oii sivcciccesesssevccessonasvcsiaces PPT IGE, seinen tetas deadtsinaaeeee ins ‘. Il. ITT. IV. THERE IS NO CONFLICT WITH THE gt hi wy Be to. 8) 5 epee pmmrnresrc nn THERE IS NO CIRCUIT CONFLICT ON WHETHER PAYMENTS TO THE CITY INVOLVE THE CREATION OF AN PN BRI io ai odsnctsnhihaseancescveceniacueneeans THE DECISION BELOW IS CONSIS- TENT WITH THIS COURT’S ERISA PREEMPTION RULINGS...............ccsceneees NUMEROUS OTHER FACTORS COUN- SEL AGAINST A GRANT OF CERTIO- MUNI Sha cis bcssunvencsiminvin tec nstarinionrnnadeates A. Petitioner Greatly Exaggerates The Impact Of The Ninth Circuit’s Ruling... B. The Case Is A Poor Vehicle For Consideration Of Most Arguments Made By Petitioner And Its Allies....... C. The Result Sought By Petitioner And Its Allies Would Have A Devastating Impact On The People Of San ee yeas 18 24 31 31 ill TABLE OF CONTENTS — Continued Page D. The Potential Enactment Of Federal Health Care Legislation Counsels Against A Grant Of Certiorari............. 39 Ce PE ares v-xxnn'vc nance chic onuanwoavedecentassennen@iatsueial 40 APPENDIX APPENDIX A_ Joint Response to Applica- tion for Order Staying Mandate and Vacating Stay of District Court Judgment..................... App. 1 APPENDIX B-_ Department of Public Health Regulations Implementing Healthy San Francisco and Medical Reimbursement Ac- count Provisions of the San Francisco Health Clare ROOUFICY OTGINONC® «.05....0 SRRRSEIRERRIDy pce oie en 30, 31 Massachusetts v. Morash, 490 U.S. 107 2 SARS STORES EA pe Oe aN Sn re 19, 20, 25, 27 Metropolitan Life Ins. Co. v. Massachusetts, en Ue os a canada ba deedbenendalaantanare 26 N.Y. State Conf. of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645 SED aie cTcuniade shay Vixbaad sc aspsessispedieddacs vessel einpedians passim TABLE OF AUTHORITIES —- Continued Page Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41 sf Fee RTE NO OED i? 5 Rn eee aD RN ARCH cen STOO 20 Retail Indus. Leaders Ass’n v. Fielder, 475 F.3d ne eo agnuun jecupwunie van passim Retail Indus. Leaders Ass’n v. Suffolk County, 497 F. Supp. 2d 403 (E.D.N.Y. 2007) ........cccceccceee- 32 Shaw v. Delta Air Lines, Inc., 463 U.S. 85 DN Joss ceudsasaaduneinspra¥ebassaneasunaie wand axcadedaemeiurieechtsusea 11 Standard Oil v. Agsalud, 633 F.2d 760 (9th Cir. 1980), summarily aff'd, 454 U.S. 801 (1981)..... 12, 26 WSB Elec., Inc. v. Curry, 88 F.3d 788 (9th Cir. er rea asa 11 FEDERAL STATUTES 29 U.S.C. IEEE «cob ova cadeduveuscastaeksdeedednbardtiundeckidesiacueviuenel iia 16 DP OUND coc ccccscexsctcessss Lr ieavataceuseessteudaainrecéuiateae 20 nn oo. 7 ra eack soap anabaWaadesaecwunenemenden 19, 20 i IE so ace ius pede maser aaennapdausaciananl 24 IIE cs. ss 5c cctupccauuba nue dcucesseassandsedwueleinciascienee 21 8 tS Re aOR P NL RITES AIDS TES « 21 OF ER ics Facareraisiscensvassuceiacderssauantedenainetaien 26 v1 TABLE OF AUTHORITIES — Continued Page STATE STATUTES & CODES 114.5 Mass. Code POE. RFR sive visnensstdishicciascstsers isch see 2006 Mass. Legis. Serv. Ch. 58 (West).....................+- 33 2009 Conn. Legis. Serv. eae, FAG FEO BGS CPM) bc nics ivessvnaceasesesvacaceueemoen 33 N.Y.C. Admin. Code Dy EI iccison snanounsdscocasesbacssensavesenmveciaaeion aaa 33 Vt. Stat. Avan. £36. 21, S DES CB onc issssccscveisccodavsuses 33 SAN FRANCISCO STATUTES, CODES & ORDINANCES S.F., Cal. Admin. Code DE BEG Bin vadcchncdsnnaepssaancveesessscieeea eee 4 DD RG RO veissisnsnve cdccavesceanpeessaesssesesuseeuenseeaneeee 2 DRG EOD oviestesscnncecesieesdassaneatmenseandaneeeeee 1 © BG iis in nacknessehsvdevseneneesneuuneonsturedennl ae 2 © RG BMD iviiicckctonscnssesnnsnssomaensscedaeeeeeeee 4 SAN FRANCISCO REGULATIONS Department of Public Health BROS Tn Paks 0kccexeessncosandsevuadanauevesvecteae gies 4 PR TEND vain sansevsnvcenssccevicssnrvserspersleenees ae 4 Office of Labor Standards Enforcement BRE. BAI E Ponhccsesessisss cascsestschesdaovetpakascanstyeceeeeel 3 Be GPA Basie sv cncssnscdecinescuesenveaseuavacciee ee 4 Beg. C.F) ve vcssvssaiicssesseseecrensstesnssenea rege 5 Vii TABLE OF AUTHORITIES — Continued Page Nee Niels secconcapenscasnecoocesncescsoeees acaae Tee ee ULL Us secon espescusveceoevedrocscoceses seer ecdaaaae ARTICLES Bob Egelko, Obama administration mum on S.F° health plan, S.F. Chron., July 20, 2009, Neen eres dy esbesenesdnsrcacrccdcccessocceessccccccees 23 Victoria Craig Bunce et al., Health Insurance Mandates in the States, Council for Afford- able Health Insurance (2008 ed.) at 1.................... 26 OTHER REFERENCES eee Sekt LOM. (IN). ZOO8B).............c0ccccrcccscreeseBe A.B. 860, 97th Leg., 2005-06 Sess. (Wis. 2005).........32 H.B. 1703, 159th Sess., 2d Year (N.H. 2006)............. 32 H.B. 2517, 59th Leg., 2d Sess. (Wash. 2005).............32 eee eee es OBS. CVA. ZOOG).........cccccccccserececevesccers 32 H.B. 4024, 77th Leg., 2d Sess. (W. Va. 2006).............32 H.R. 1316, 2d Reg. Sess. (Colo. 2006)............. sseusei ane S. 1618, 107th Reg. Sess. (Fla. 2006).........................32 5.B. 2684, 2006 Reg. Sess. (Miss. 2006) .................... 32 S.B. 87, 94th Leg., Ist Reg. Sess. (Mich. 2007) .........32 STATEMENT A. The Health Care Security Ordinance In 2006, San Francisco was in the midst of a health care crisis. An estimated 82,000 people were without coverage. See Resp. App. 11. Tens of thousands more only had coverage under bare-bones “safety-net” programs, such as Medicaid, that provided limited care to indigent residents. Jd. Not only did this threaten the health and well-being of many San Francisco residents; it put tremendous strain on the taxpayers, who were forced to bear the cost when the uninsured used public hospital emergency rooms for preventable illness or injury. Jd. at 28. To address this crisis, San Francisco’s Board of Supervisors enacted the Health Care Security Ordinance (“HCSO” or “ordinance”). The ordinance has two interlocking components — a public health care program, and an employer health care spending requirement. The public program is operated by the City’s Department of Public Health (““DPH”). Its primary feature is the Health Access Program (“HAP”), which delivers health care to participants from a network of public and private providers. Pet. App. 1l3a (S.F.,, Cal., Admin. Code § 14.2(a) (2007)).'’ The HAP assigns ' The City has changed the name of the program from the HAP to “Healthy San Francisco.” For purposes of litigation, the parties have continued to use the name contained in the ordinance. 2 a primary care physician, nurse practitioner or physician assistant to each participant. Among the specific services provided are preventive care, inpatient and outpatient hospital services, diagnostic and laboratory services, radiological services, mental health services, home health care, and prescription drug benefits. Pet. App. 114a (Admin. Code § 14.2(f )). The value of this care is substantial — DPH estimated that in 2008 it cost the City an average of $261 per participant per month to provide. Resp. App. 13. The HAP is funded primarily by City tax dollars and partly by employer payments. It is available to uninsured San Francisco residents, regardless of whether they are employed. Enrollees must pay quarterly participation fees on a sliding scale, and must make co-payments for medical visits. The other component of the ordinance is a mandate that medium and large businesses make minimum health expenditures on behalf of employees who work more than a specified number of hours. Specifically, in 2009, private employers with 20-99 employees, and nonprofit employers with 50 or more employees, must spend $1.23 per hour on behalf of any employee who has been employed for 90 days and works more than eight hours per week. Private employers with 100 or more employees must spend $1.85 per hour for each such employee. The requirement is capped at 40 hours per week. Pet. App. llla-12a (Admin. Code § 14.1(b)(8), (10); Pet. App. 138a (S.F°., Cal., Office of Labor Standards Enforcement Reg. 5.2(A)(1)). According to studies compiled by the San Francisco Controller’s Office, roughly 90% of medium and large businesses already provided health insurance to their employees when the ordinance was enacted. Resp. App. 15. And the average monthly insurance premium in California at that time was $379. Id. To comply with the mandate, employers may spend money through their own health care plans, or make payments to the City on behalf of their workers. Id. They may also fulfill the expenditure obligation through a combination of methods. For example, an employer may prefer to keep its full-time employees in a private ERISA plan while selecting the public option for its part-time employees. The program is structured so that, if an employer chooses the city payment option, it need only write a check, and all employees on whose behalf payment is made are eligible to participate in the City’s program. Contrary to petitioner’s representation, the employer does not “enroll [its] employees with the City.” Pet. 10. The employer simply pays the City on behalf of specified workers, and notifies the workers that it has done so. Pet. App. 144a (OLSE Reg. 7.2(A)(5)). The rest (enrollment, the type of care _ provided, 4 copayments) is purely between the City and the individual.” Employees who qualify for HAP membership are, if their employers choose to satisfy the spending requirement by paying the City, entitled to enroll in the program at a 75% discount on the quarterly participation fees they would otherwise be required to pay. Resp. App. 53-54 (DPH Reg. 7(f)). As discussed more fully below, the result is that, when an employer pays the City, the employer knows its workers will be eligible for comprehensive care at a far lower cost than what it would have to pay for private insurance. The City also adopted two regulatory provisions — unmentioned by petitioner — that facilitate com- pliance for large, multijurisdictional employers. The first may be utilized by employers that provide traditional health insurance to their workers, such as Kaiser or Blue Shield. It allows these employers to establish compliance without keeping track of the health care dollars spent on each individual em- ployee, and without making any separate calculations for their San Francisco employees. Pet. App. 14la (OLSE Reg. 6.2(B)(1)). An employer that purchases * Individuals who work in San Francisco but live elsewhere do not qualify for HAP participation, but the City uses employer payments to provide medical reimbursement accounts for such individuals. They may draw from their accounts to obtain reimbursement for medical expenses, including payments of health insurance premiums. Pet. App. 110a, 114a-15a (Admin. Code §§ 14.1(b)(7), 14.2(g)); Resp. App. 55 (DPH Reg. 7(g)G)). 5 insurance for its employees in San Francisco and in other parts of the country need only divide its total payments to the insurance company for all those employees by the total number of employees. Assuming the amount per employee is greater than the spending obligation (and private health insurance is far more expensive than the spending obligation), this establishes compliance. The second’ regulatory’ provision = allows employers that operate “self-insured” plans (through which the employer bears the risk of employee health care costs on its own rather than paying an insurance company a set rate to bear that risk) to establish compliance in similar fashion. It provides that such employers comply “if the preceding year’s average expenditure rate per employee meets or exceeds the applicable expenditure rate ... for that employer.” Pet. App. 141a (OLSE Reg. 6.2(B)(2)). Accordingly, an employer with a self-insured plan may establish compliance simply by showing that it has spent a certain amount per employee on a plan-wide basis. The medium and large employers subject to the ordinance must also keep records. These records are generally already kept in the normal course of business, and employers are not “required to maintain such records in any particular form.” Pet. App. 116a. Once per year, employers must file a one- page report with the City, identifying the total amount paid for health care and the manner in which the money was spent. Pet. App. 144a (OLSE Reg. 7.3). 6 Since the HCSO became fully operational in January 2008, San Francisco has taken great strides towards the achievement of universal health care. In less than 1% years, the number of residents without health coverage dropped from 82,000 to fewer than 23,000, and that number continues to go down. Resp. App. 25. Following enactment of the ordinance, emergency room visits at San Francisco General Hospital dropped almost seventy percent in one year — from 29,976 to 8,944. Id. at 28. B. Procedural History Petitioner filed suit in the Northern District of California, alleging that the Employee Retirement Income Security Act of 1974 (“ERISA”) preempts the health care spending requirement. The district court granted summary judgment for petitioner, reasoning that the ordinance was “designed to act immediately upon, and cannot operate successfully without the existence of [ERISA] plans.” Pet. App. 93a. At the same time, however, the court rejected petitioner’s contention that monetary payments by employers to the City themselves create a “de facto ERISA plan.” Pet. App. 94a. The Ninth Circuit granted the City’s application for a stay of the district court’s ruling. The court ruled that, given the availability of a non-ERISA com- pliance option for every type of employer (namely, payment to the City), the district court was wrong to conclude that the ordinance acts immediately upon 7 ERISA plans or interferes with plan uniformity. Golden Gate Rest. Ass’n v. City & County of San Francisco, 512 F.3d 1112, 1119-23 (9th Cir. 2008). The court noted that legal requirements like San Francisco’s — that “only relate[] to ERISA plans at the election of an employer” — are regularly upheld against ERISA preemption challenges. Jd. at 1122 (quotations omitted). The court also concluded that the balance of hardships tipped in favor of the City, and that the public interest weighed in favor of a stay pending appeal. /d. Petitioner filed an application to this Court to lift the Ninth Circuit’s stay order, which was denied by the Circuit Justice. After the parties briefed and argued the case on the merits, the Ninth Circuit reversed the district court. This time, petitioner and its allies focused on the argument that an employer actually creates an ERISA plan when it writes a check to the City, thereby leaving employers with no non-ERISA means for complying with San Francisco’s requirement. The Ninth Circuit rejected this argument, determining that the city payment option lacks most indicia of an ERISA plan. The court observed that the employer’s obligations under the city payment option “do not run the risk of mismanagement of funds or other abuse,” which was the original concern that led to ERISA’s passage. Pet. App. 20a. It observed that the HAP is a government entitlement program, funded primarily by taxpayer dollars, that is available to residents regardless of employment status. Pet. App. 24a-25a. And the court described the key differences between 8 the city payment option and an employer’s purchase of health insurance from a third party, which coes involve the creation of an ERISA plan. /d. at 26a. Petitioner also persisted in the argument that, even if payments to the City do not create an ERISA plan, the spending requirement was preempted because it had an improper “connection with” ERISA plans. The court rejected this argument, explaining that the existence of the city payment option meant no employer was required to adopt an ERISA plan, or to provide specific benefits through an existing ERISA plan. Pet. App. 29a. The court also rejected the argument that the HCSO has a= forbidden “reference” to ERISA plans, observing that “[w]Jhere a law is fully functional even in the absence of a single ERISA plan ... as it is in this case, it does not make an impermissible reference to ERISA plans” Pet. App. 36a. Petitioner sought en banc rehearing, which was denied. Petitioner then filed an application to this Court for a stay pending a petition for certiorari, which was also denied. ARGUMENT The Court of Appeals correctly upheld San Francisco’s program, because ERISA does _ not preempt local requirements that give employers a reasonable option for complying that does not involve the adoption or alteration of an ERISA plan. The 9 option to pay the City is a reasonable choice for employers, and it does not create an ERISA plan. The city payment option is reasonable, indeed attractive, because the employers’ payments make their workers eligible for comprehensive health services, funded primarily by City tax dollars, for far less than the employers would have to pay for comparable benefits on the private market. As such, this case is clearly distinguishable from Retail Indus. Leaders Ass’n v. Fielder, 475 F.3d 180 (4th Cir. 2007), which struck down a Maryland law that imposed a bare penalty on Wal-Mart for failing to provide an adequate ERISA plan for its employees. Nor does the employer create an ERISA plan by exercising the city payment option. This arrangement neither meets the statutory definition of such a plan nor implicates ERISA’s central concern — ensuring that benefits promises by private employers to their employees are kept. As the Ninth Circuit explained in detail, writing a check to the City on behalf of specified employees is not cemotely analogous to third-party health insurance contracts, which are ERISA plans. At the end of the day, petitioner’s argument rests on a faulty premise: that ERISA immunizes employers from being required to spend money in areas, like health care, mentioned in the ERISA statute. As this Court has already explained, ERISA preemption protects only plan uniformity for employers, not general expenditure uniformity. 10 Because the ordinance in no way interferes with plan uniformity, the Ninth Circuit’s ruling that it is not preempted is consistent with this Court’s ERISA preemption jurisprudence. This case is the wrong vehicle, at the wrong time, to consider an employer’s claim that ERISA preempts general health care spending requirements. Peti- tioner presented no evidence that the city payment option is not a rational choice for employers. Nor did it present evidence that the ordinance, even if replicated elsewhere, would impose anything but a de minimis administrative obligation on employers. Indeed, the only evidence in the record on these issues contradicts petitioner’s claims. Nor is there any immediate threat that numerous similar laws will sprout up throughout the country, particularly with Congress considering federal health care reform legislation. And the serious possibility that federal legislation will moot the ERISA preemption issue in this case weighs heavily against the Court granting certiorari now. Finally, if federal legislation is not enacted, and if other jurisdictions were then to enact laws similar to San Francisco’s in the future, this Court would have the opportunity to address the arguments presented by petitioner and its allies at that time, and on a better record. 11 I. THERE IS NO CONFLICT WITH THE FOURTH CIRCOUIT. There is widespread agreement that ERISA docs not preempt a local requirement if employers have a reasonable non-ERISA means to comply with that requirement. See, e.g., Keystone Chapter, Associated Builders & Contractors v. Foley, 37 F.3d 945, 960 (3d Cir. 1994) (“LwJhere a legal requirement may be easily satisfied through means unconnected to ERISA plans, and only relates to ERISA plans at the election of an employer, it affects employee benefit plans in too tenuous, remote, or peripheral a manner to warrant a finding that the law ‘relates to’ the plan”) (internal quotations, citations and brackets omitted). See also Fielder, 475 F.3d at 193 (state laws that “do not bind the choices of employers or their ERISA plans [are] generally not preempted”); WSB Elec., Inc. v. Curry, 88 EF3d 788, 795 (9th Cir. 1996) (“nothing in California’s scheme requires the establishment of a separate benefit plan in order to comply with the state law. California’s statute does not require public works contractors to modify their benefits plans at all”). The above rule is grounded firmly in this Court’s precedents, which make clear that while ERISA preempts laws th.it dictate employer choices about employee welfare benefit plans, it does not preempt generally applicable laws that merely influence choices with respect to ERISA plans. Thus, ERISA prevents states from dictating which benefits must be contained in plans. See, e.g., Shaw v. Delta Air Lines, 12 Inc., 463 U.S. 85, 96-97 (1983) (striking down law that required plans to include pregnancy benefits). It prevents states from forcing employers to adopt ERISA plans in the first place. See, e.g., Standard Oil v. Agsalud, 633 F.2d 760, 766 (9th Cir. 1980), summarily aff’d, 454 U.S. 801 (1981) (striking down Hawaii law that required employers to adopt ERISA plans with specified benefits). And it prevents states from dictating who must benefit from ERISA plans. Egelhoff v. Egelhoff, 532 U.S. 141, 147 (2001) (state law preempted because it “binds ERISA plan administrators to a particular choice of rules for determining beneficiary status”). In contrast, ERISA does not preempt health care surcharges that exert a strong influence on decisions about ERISA plans. See N.Y. State Conf. of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 659-60 (1995). It does not preempt imposition of a generally applicable tax upon facilities owned by ERISA plans. De Buono v. NYSA-ILA Med. & Clinical Services Fund, 520 U.S. 806, 816 & n.16 (1997). And it does not preempt state laws that give powerful incentive to ERISA apprenticeship programs to seek regulatory approval from the state, and to make the changes necessary to obtain such approval, as long as the laws do not force them to do so. Cal. Div. of Labor Stds. Enforcement v. Dillingham Constr, N.A., 519 U.S. 316, 332-33 (1997). Obviously, if employers may readily comply with a requirement without adopting or altering ERISA plans, such a requirement does not dictate choices 13 with respect to plans. As set forth below, the Fourth and Ninth Circuits merely applied this well- established principle in the specific context of health care spending, and reached consistent results. Fielder involved a preemption challenge _ to Maryland’s Fair Share Act, which provided that any Maryland for-profit employer with more than 10,000 employees that does not spend up to 8% of its payroll on health insurance (1.e., Wal-Mart) must make up the deficiency by paying it to the Maryland Secretary of Labor. 175 F.3d at 184. Wal-Mart’s employees would not receive any benefits, services, or cost savings in return for such payments. /d. at 193. The Fourth Circuit held that this law effectively required Wal-Mart to alter its ERISA plan because no rational employer would choose to pay the money to the State when the employer could instead increase health care spending in a manner that benefited its employees: An employer would gain from increasing the compensation it offers employees through improved retention and _ performance of present employees and ability to attract more and better new employees. In contrast, an employer would gain nothing in consideration of paying a greater sum of money to the State. Indeed, it might suffer from lower employee morale and increased public condemnation. 14 In effect, the only rational choice employers have under the Fair Share Act is to structure their ERISA healthcare benefit plans so as to meet the minimum spending threshold. The Act thus falls squarely under Shaw’s prohibition of state mandates on how employers structure their ERISA plans. Id. at 193-94 (emphasis added). As the Ninth Circuit explained, San Francisco’s ordinance, “[iJn stark contrast to the Maryland law, . offers employers a meaningful alternative that allows them to preserve the existing structure of their ERISA plans.” Pet. App. 38a-39a. Workers whose employers comply through payments to the City, rather than by establishing or altering ERISA plans, receive “tangible benefits” in return. Jd. Highlighting the reasonableness of the city payment option, almost nine hundred medium and large businesses selected it in the first 1% years of its existence. Resp. App. 33. That so many employers have selected this option is not surprising, since it allows employers to avoid the inconvenience of setting up their own ERISA plans, while knowing that their workers will receive comprehensive health coverage from the City at a price far lower than it would cost the employers in the private market.” In short, the option to pay the government in Fielder was a penalty that no rational employer would choose. The city payment option here is not a penalty, because it gives employers a meaningful, non-E RISA compliance alternative that allows them to maintain plan uniformity. San _ Francisco’s ordinance, in other words, is utterly indifferent to whether an employer has an ERISA plan. Thus, under the Fourth Circuit’s analysis, an ordinance like San Francisco’s would survive a_ preemption challenge. While the Fourth Circuit concluded that Maryland’s law “directly regulatl[ed| the structuring or administration of an ERISA plan,” 475 F.3d at 192, it could not have made the same statement about the HCSO. The two decisions operate in harmony, and they are both consistent with established ERISA precedent from other contexts. “The City presented unrebutted evidence in the district court that the health benefits received by employees from the City are extraordinarily generous in relation to the amount paid by the employer, and in comparison to the amount the employer would be required to pay on the private market. The average insurance premium in California was $379 per month when the ordinance took effect. In contrast, for a medium-sized employer with an employee who works 20 hours per week, the employer could satisfy its spending obligation in 2008 by paying the City $ 93.60 per month, even though it would cost the City much more than that to provide the care. In short, the city payment option gives employees a HAP membership that provides com- prehensive health services at pennies on the dollar for the employer. 16 Notwithstanding this, petitioner claims a circuit conflict based on the Fourth Circuit’s discussion of an issue that was not presented to, or considered by, the Ninth Circuit. Specifically, after holding that the option of paying the government was nothing more than a penalty that forced Wal-Mart to alter its ERISA plan, the Fourth Circuit turned to Maryland’s alternative argument that Wal-Mart had other, private non-ERISA alternatives for complying. According to Maryland, Wal-Mart could satisfy the spending requirement through the creation of on-site medical clinics or Health Savings Accounts. The court rejected this argument on the ground that the purported alternatives were unrealistic. 475 F.3d at 196. And then the court observed that even if Wal-Mart could avail itself of these options, they would necessarily also produce a change in the company’s ERISA plan: If Wal-Mart were to attempt to utilize non- ERISA health spending options to satisfy the Fair Share Act, it would need to coordinate those spending efforts with its existing ERISA plans. For example, an individual would be eligible to establish a Health Savings Account only if he is enrolled in a high deductible [ERISA] health plan. See 29 U.S.C. § 223(c)(1). In order for Wal-Mart to make widespread contributions to Health Savings Accounts, it would have to alter its package of ERISA health insurance plans to encourage its employees to enroll in one of its high deductible health plans. From the employer’s perspective, the categories of ERISA and non-ERISA healthcare spending 17 would not be isolated, unrelated costs. Decisions regarding one would affect the other and thereby violate ERISA’s pre- emption provision. Id. at 196-97. This is not, as petitioner asserts, an alternative holding by the Fourth Circuit that any spending mandate in the health care area must be preempted — i.e., that every conceivable non-ERISA compliance option would become entangled with ERISA plans and necessarily interfere with ERISA plan uniformity. It is a rejection of the specific arguments presented by Maryland.’ Finally, the implications of a rule preventing local governments from imposing any general health care spending requirement on employers show that the Fourth Circuit could not have intended to adopt such a rule. San Francisco’s ordinance goes out of its way to avoid giving employers an incentive to adopt or alter ERISA plans. If, instead, San Francisco imposed a payroll tax on employers to fund a comprehensive public health care program without regard to whether employers already have health care plans (that is, without giving employers credit for the health care spending they already make), this * Petitioner omits the sentences from the above passage which show that the Fourth Circuit was addressing Maryland’s specific argument about the non-ERISA compliance options it offered. As Judge William Fletcher pointed out in his opinion concurring in the denial of rehearing en banc, the eight dissenting judges from the Ninth Circuit did the same thing. Pet. App. 45a-46a. 18 would create a significant incentive for employers to drop their ERISA plans, to avoid spending substantial sums on health coverage that their employees could instead obtain for free. Nobody could reasonably argue that such a payroll tax would be preempted. It would be ironic, then, if ERISA were held to preempt a law that imposed far fewer incentives with regard to plans. Given the backwards legal regime that would result from the broad rule that petitioner ascribes to Felder, there is no basis for concluding that the Fourth Circuit intended to adopt it.” Il. THERE {IS NO CIRCUIT CONFLICT ON WHETHER PAYMENTS TO THE CITY INVOLVE THE CREATION OF AN ERISA PLAN. Petitioner and some amici also argue that the Ninth Circuit created a conflict by rejecting the argument that when an employer opts to comply with the HCSO by writing a check to the City, this itself ° As discussed by the Brief of Amicus Curiae Nibbi Bros. Associates, Inc., courts have reached the same conclusion about the many prevailing wage laws that allow employers to comply in part by providing ERISA benefits to their employees. If ERISA preempted prevailing wage laws that gave employers credit for ERISA spending, while leaving undisturbed prevailing wage laws that refused to give credit for ERISA spending, this would incent employers to drop ERISA plans, which is precisely the opposite of what the preemption provision intended. Petitioners seek a result that would disturb the _ settled understanding among the circuits that prevailing wage laws with benefits components are not preempted. 19 involves the creation of an ERISA plan. But no other appellate decision even considers whether a public payment option is an ERISA plan. Accordingly, to create the illusion of a conflict, petitioner and its allies rely on cases which hold that an employer creates an ERISA plan when it contracts with a health insurance company to provide health care to its workers. See, e.g., Brundage-Peterson v. Compcare Health Servs. Ins. Corp., 877 F.2d 509, 511 (7th Cir. 1989). They attempt to analogize these insurance contracts to the city payment option, and contend a circuit conflict exists because the Ninth Circuit rejected the analogy. That is not a real conflict. And the Ninth Circuit was right to reject the analogy, which is inapt, is contrary to the purposes of ERISA, and would, if adopted, create serious problems in ERISA preemption law. ERISA defines an “employee welfare benefit plan” as “any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer .. . for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise,” specified benefits. 29 U.S.C. § 1002(1). The specified benefits include, among others, vacation, disability, unemploy- ment, severance, and, of course, medical benefits. Id. In Massachusetts v. Morash, 490 U.S. 107 (1989), this Court explained that because the reach of the above definition of an employee welfare benefit plan is — like the preemption provision — potentially limitless, the determination whether a particular 20 arrangement is the type of “plan” that falls within ERISA’s ambit must be made with reference to “‘the provisions of the whole law, and to its object and policy.” Jd. at 115 (quoting Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 51 (1987)). Applying this principle, the Court in Morash determined that vacation benefits paid out of general assets did not present the types of risks that Congress intended to address when it enacted ERISA and, therefore, that it would not read the statute to encompass such an employer policy to pay vacation benefits. Jd. Here, an examination of ERISA’s “object and policy” demonstrates why the Ninth Circuit was right to reject petitioner’s analogy to an insurance contract. While petitioner and its amici paint ERISA as a law whose central purpose is to preserve some undefined “uniformity” for employers, in actuality the statute’s “primary concern” is “with the mismanagement of funds accumulated to finance employee benefits and the failure to pay employees benefits ... ” Morash, 490 U.S. at 115 Gnternal citations omitted). See also 29 U.S.C. § 1001(b). In other words, the primary purpose of ERISA is to ensure that private employers’ benefits promises to their employees are kept. These concerns are clearly implicated by an employer’s promise to provide health insurance to its employees, because under this arrangement the employer remains’ ultimately responsible for “providing” the benefits. 29 U.S.C. § 1002(1). The employer, when negotiating the health insurance contract, gives shape to the plan by deciding, for 21 example, which treatments will be covered or how claims will be processed. And if the insurance company does not fulfill its contractual obligation to deliver the contemplated benefits to the employees, the employer, as an ERISA fiduciary, can sue the insurer to make sure that the employer’s promise to the employees 1s kept. See 29 U.S.C. §§ 1132(a)(2), (3). As the Ninth Circuit explained, with the city payment option, “(t]he employer never negotiates or signs a contract with the City, and the employer has no control over the City’s coverage decisions. When the City administers the HAP, it does not act as the employer’s agent entrusted to fulfill the benefits promises the employer made to its employees.” Pet. App. 26a. Nor does the employer enroll its employees with the HAP. The mere act of writing a check to the City on behalf of specified employees, and informing those employees that the check has been written, is not remotely comparable to a contractual relationship between an employer and a health insurance company. And because the Ninth Circuit explained why third party insurance arrangements are ERISA plans even while the city payment option is not, Pet. App. 25a-26a, there is no basis for petitioner’s assertion that the decision will cause courts to begin ruling that third-party contracts are not ERISA plans. See Pet. 36 (“employers will be able to avoid ERISA’s fiduciary duty rules and its civil and criminal enforcement provisions merely by hiring a third- party to perform the bundle of plan-design and 22 administrative-and-fiduciary tasks inherent in any plan”). If a litigant had the audacity to make such an argument in a future casc, the first authority a court would cite to reject it is the Ninth Circuit’s decision below. In fact, had the Ninth Circuit concluded that an employer creates an ERISA plan when it calculates its health care spending obligation and makes payments to the government, this would have created major problems in ERISA preemption law. For example, imagine that a local government, instead of adopting a program like San Francisco’s, simply imposed a payroll tax to be used to fund a public health program for all persons who work in the jurisdiction. Nobody could reasonably contend that an employer creates an ERISA plan when it pays this payroll tax. Yet petitioner here has advocated a definition of “ERISA plan” that would include this scenario — the employer creates a plan simply by determining its spending obligation and satisfying that obligation by making a payment to the govern- ment, which the government then uses to fund a public health program that includes the employer’s workers. Another consequence of deeming the _ city payment option a “plan” would be that federal obligations (and liabilities) could be imposed on employers with respect to matters over which they have no control, such as the obligations to act as a fiduciary with respect to benefits provided to HAP participants, and to create and operate a system for 23 processing claims by HAP participants. Equally problematic, San Francisco public health officials who operate this entitlement program could be subjected to ERISA’s regulatory regime simply because some employers chose to satisfy their health care spending obligations by writing a check to the City. These consequences underscore the serious flaws in the argument that the city payment option creates an ERISA plan. Petitioner makes much of an amicus brief filed below by the former Secretary of Labor agreeing that the city payment option creates an ERISA plan. More noteworthy, however, is that none of the 28 judges invoived in the proceedings below adopted this novel argument — not the district judge who ruled against the City, and not the eight circuit judges who dissented from denial of rehearing en banc. Moreover, the current Department of Labor has stated it is “considering issues in the case,” Bob Egelko, Obama administration mum on S.F. health plan, S.¥. Chron., July 20, 2009, at Cl, so it would be wrong to assume that the former Secretary’s brief is reflective of the current Administration’s views. Once it is understood that the city payment option does not create an ERISA plan, the language permeating the petition to the effect that the ordinance intrudes on “plan regulation” is revealed to be widely off the mark. See, e.g., Pet. 28 (arguing decision below allows local governments to “regulate ERISA plans themselves by first requiring their establishment and then dictating what benefits the 24 plan provides ... ”). Such assertions depend on the assumption that the city payment option creates a plan, and the petition unravels when that assumption is removed. IH. THE DECISION BELOW IS CONSISTENT WITH THIS COURT’S ERISA PREEMPTION RULINGS. At the end of the day, petitioner’s preemption argument is based on the assumption that employers are entitled to expenditure uniformity in areas mentioned by the ERISA statute. That assumption is wrong — ERISA does not insulate businesses from being required to spend money in these areas. ERISA protects plan uniformity for employers, but “cost uniformity was almost certainly not an object of pre- emption ...” Travelers, 514 U.S. at 662. This is illustrated by Fort Halifax Packing Co. v. Coyne, 482 U.S. 1 (1987), which makes clear that states and localities may regulate expenditures on benefits mentioned in ERISA (in that case severance pay), so long as they do not require adoption or alteration of ERISA pians: Appelilant’s basic argument is that any state law pertaining to a type of employee benefit listed in ERISA necessarily regulates an employee benefit plan, and therefore must be pre-empted. Because severance benefits are included in ERISA, see 29 U.S.C. § 1002(1)(B), appellant argues that ERISA pre-empts the Maine statute. In _ effect, 20 appellant argues that ERISA forecloses virtually all state legislation regarding employee benefits. This contention fails, however, in light of the plain language of ERISA’s pre-emption provision, the under- lying purpose of that provision, and the overall objectives of ERISA itself. ... ERISA’s pre-emption provision does not refer to state laws relating to “employee benefits,” but to state laws relating to “employee benefit plans”.... The words “benefit” and “plan” are used separately throughout ERISA, and nowhere in the statute are they treated as the equivalent of one another. Given the basic difference between a “benefit” and a “plan,” Congress’ choice of language is significant in its pre-emption of only the latter. 482 U.S. at 7-8 (emphasis in original). Two other cases in which the Court upheld local regulation of benefits mentioned in ERISA were Dillingham and Morash. In Dillingham, the state’s regulation of apprenticeship programs _ created powerful incentives for those programs to alter their conduct, and may have affected employer costs, but that was not sufficient to establish preemption. 519 U.S. at 332. In Morash, the state’s requirement that employers reimburse employees for unused vacation time obviously affected employers’ costs, but there was no preemption in that case because the requirement did not regulate ERISA plans. 490 U.S. at 114-15. In the area of health care itself, ERISA contemplates that employers will be subject to disparate costs across jurisdictions. If the goal of 26 ERISA preemption had been health care expenditure uniformity, Congress would not have included the savings clause, which exempts from preemption state laws regulating insurance. 29 U.S.C. § 1144(b)(2)A). The savings clause has resulted in the enactment of more than 1,961 mandates on health insurance, and no two states impose identical sets of coverage man- dates. Victoria Craig Bunce et al., Health Insurance Mandates in the States, Council for Affordable Health Insurance (2008 ed.) at 1. Accordingly, the cost of employer-provided health insurance varies dramati- cally from state to state. Jd. at 3-5. “Such disuni- formities ... are the inevitable result of the congres- sional decision to ‘save’ local insurance regulation.” Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724, 747 (1985). And that is why “cost uniformity was almost certainly not an object of pre-emption, just as laws with only an indirect economic effect on the relative costs of various health insurance packages in a given State are a far cry from those ‘conflicting directives’ from which Congress meant to insulate ERISA vlans.” Travelers, 514 U.S. at 662.° * Petitioner asserts that the preemption provision was meant to preclude bare health care spending requirements at the state or local level. Pet. 4-5 & n.13. But it does not point to a single word in ERISA’s voluminous legislative history to support this conclusion. And although one former Congressional staffer has claimed that the provision was designed in part to preempt the Hawaii health care statute in existence at the time, id., that statute was not a general expenditure requirement; it required that. employers actually adopt. employee welfare benefit plans. See Agsalud, 633 F.2d at 766. 27 Petitioner also makes much of the possibility that a local requirement in one jurisdiction might affect an employer’s decisions about benefit expenditures in other jurisdictions. But the local severance and vacation pay requirements in Fort Halifax and Morash, the hospital surcharges upheld in Travelers, and the apprentice regulations upheld in Dillingham may all provide employers with some incentive to decrease spending on benefits in other jurisdictions. These cases demonstrate that ERISA’s preemption provision was never intended to provide employers with umbrella protection against laws that might simply change the mix of economic incentives to increase or reduce benefit expenditures. Petitioner and its allies disregard all of this, and instead rely upon an analytical sleight-of-hand that blurs the distinction between “expenditures” or “benefits” on the one hand, and “plans” on the other. For example, one brief asserts that “[t]he need to monitor expenditures in multiple jurisdictions is squarely at odds with ERISA’s purpose of establishing a uniform system of plan regulation.” Similarly, petitioner quotes Travelers as saying that the purpose of ERISA preemption is to “‘avoid a multiplicity of regulation in order to permit the nationally uniform ’ Brief for the Retail Industry Leaders Association and the Chamber of Commerce of the United States of America as Amici Curiae in Support of Petitioner (“RILA”) at 14 (emphasis added). 28 administration’ of employee benefits.” Pet. 22 (quoting Travelers, 514 U.S. at 657). What Travelers actually says is that the purpose of ERISA preemption is to “avoid a multiplicity of regulation in order to permit the nationally uniform administration of employee benefit plans.” Travelers, 514 U.S. at 657 (emphasis added). When the distinction between expenditures and plans is brought back into focus, it becomes clear that there is no conflict with the two decisions primarily relied upon by petitioner and its allies: Egelhoff and District of Columbia v. Greater Wash. Bd. of Trade, 506 U.S. 125 (1992). The Washington statute in Egelhoff provided that, in the event a couple divorces, and then one member of the couple dies after the divorce, the survivor is not entitled to the benefits of the dead spouse’s ERISA plan, even if the plan does not include such a limitation on the rights of the divorced survivor. 532 U.S. at 147. Washington argued the statute was not preempted because it exempted ERISA plans which explicitly provided that divorced spouses should receive plan benefits. Thus, Washington argued, there were two ways plan administrators could comply with the statute: (1) by administering their plans differently in Washington; or (2) by changing the terms of their plans to include specified language. But the Court held this did not save the statute from preemption, because both compliance options required plan administrators to 29 change the way they wrote or administered their plans: “Plan administrators must either [disregard the language of their plans and] follow Washington’s beneficiary designation scheme or alter the terms of their plan so as to indicate that they will not follow it.” Id. at 150. And it is in this context that the Egelhoff Court expressed concern with the need to “maintain a familiarity with the laws of all 50 States.” 532 U.S. at 151. If a law forces a plan administrator to change its ERISA plan in a given state, that goes to the core of what ERISA’s preemption provision guards against — the possibility of plan administrators being forced to “maintain a familiarity with the laws of all 50 States so that they can update their plans as necessary to satisfy the opt-out requirements of other, similar statutes.” Jd. at 151 (emphasis added). Under the HCSO, employers must track their health care expenditures, just as they must already keep track of wages and other payroll matters. But they are not forced to change anything in their plans to comply with the ordinance.” " Similarly, the statement in Egelhoff that the “tailoring of plans and employer conduct to the peculiarities of the law of each jurisdiction is exactly the burden ERISA seeks to eliminate” does not have the broad meaning petitioner gives it. 532 U.S. at 151 (citation and quotations omitted, emphasis added). ERISA does not protect employers from tailoring their conduct to local requirements with respect to everything; it protects them from tailoring their conduct with respect to plans. 30 Nor does the decision below conflict with Greater Washington. Petitioner argues that both the HCSO and the ordinance struck down in Greater Washington make unlawful “reference to” ERISA plans because they involve measuring compliance with reference to an existing ERISA plan. However, as the Court explained in Dillingham, a local law makes an unlawful “reference to” an ERISA plan if the law “acts immediately and exclusively upon ERISA plans,” or if the “existence of ERISA plans is essential to the law’s operation.” Dillingham, 519 U.S. at 325. That was true of the ordinance in Greater Washington because an employer’s obligation was triggered directly by the benefits it offered through an ERISA plan — whatever ERISA benefits the employer offered, the employer had to provide those same benefits to injured employees on workers’ compensation. 506 U.S. at 126- 27. If the employer had no ERISA plan, there was no obligation. Here, the HCSO operates on employers “irrespective of the existence of an ERISA plan.” Dillingham, 519 U.S. at 328 (quotations and ellipses omitted). Finally, some amici attempt to conjure up a conflict with Supreme Court precedent by selectively quoting the language of a Ninth Circuit decision that this Court summarily affirmed: Local Union 598 uv. J.A. Jones Constr. Co., 846 F.2d 1213 (9th Cir.), summarily aff’d, 488 U.S. 881 (1988). See RILA Br. at 8. They argue that the HCSO, by generally 31 mandating health care expenditures, is imposing a “contribution” mandate of the kind struck down in J.A. Jones. RILA Br. at 8. But again, this blurs the distinction between general expenditures and plans. The full quotation from /J.A. Jones _ further underscores this distinction: (The statute] mandates a particular level of contributions by employers to employee benefit plans.... A statute which mandates employer contributions to benefit plans and which effectively dictates the level at which those required contributions must be made has a most direct connection with an employee benefit pian. 846 F.2d at 1219 (emphasis added). In sum, no Supreme Court decision invalidates a bare expenditure requirement that provides em- ployers with a reasonable, non-EF RISA compliance option. ‘To the contrary, the Ninth Circuit’s ruling is fully supported by this Court’s precedent. IV. NUMEROUS OTHER FACTORS COUNSEL AGAINST A GRANT OF CERTIORARI. A. Petitioner Greatly Exaggerates The Impact Of The Ninth Circuit’s Ruling. Petitioner and its amici contend the Ninth Circuit’s ruling will cause an avalanche of “pay or play” laws to crumble down upon multijurisdictional employers. They dramatically overstate both the 32 possibility this will occur, and the impact it would cause. As a preliminary matter, petitioner and its allies focus primarily on proposals, not actual laws. And their primary citation is to a law review article from 2006 — two years prior to when the Ninth Circuit first upheld the HCSO. See, e.g., Pet. 20. Most of those proposals are long dead.° As for the four measures that actually became law, petitioner and its amici neglect to discuss whether the Ninth Circuit’s reasoning applies to those laws. It does not. The first law, from Suffolk County, New York, has already been struck down on the same ground relied upon by the Fourth Circuit: none of the purported non-ERISA complhance options was truly available to Wal-Mart, thereby effectively forcing Wal-Mart to alter its ERISA plan. See Retail Indus. Leaders Ass’n v. Suffolk County, 497 F. Supp. 2d 403, 417-18 (E.D.N.Y. 2007). The second law creates a board charged with establishing a universal health care program in Connecticut by mid-2010, but does not mention an employer spending requirement ” See H.R. 1316, 2d Reg. Sess. (Colo. 2006); S. 1618, 107th Reg. Sess. (Fla. 2006); S.B. 87, 94th Leg., Ist Reg. Sess. (Mich. 2007); S.B. 2684, 2006 Reg. Sess. (Miss. 2006); A.B. 1966, 213th Leg. (N.J. 2008); H.B. 258, 2006 Sess. (Va. 2006); H.B. 2517, 59th Leg., 2d Sess. (Wash. 2005); H.B. 4024, 77th Leg., 2d Sess. (W. Va. 2006); A.B. 860, 97th Lep., 2005-06 Sess. (Wis. 2005); H.B. 1703, 159th Sess., 2d Year (N.H. 2006). 33 or explain how the program will be funded. See 2009 Conn. Legis. Serv., Pub. Act No. 09-148 (West). Finally, Massachusetts, Vermont and New York City adopted employer health care spending requirements that include an option of making a payment to the government, but those payments, to use the words of the Ninth Circuit, give “nothing in return — either to an employer or its employees — for the employer’s payment to the State,” beyond what any other qualifying resident would receive. Pet. App. 37a. See 2006 Mass. Legis. Serv. Ch. 58 (West); 114.5 Mass. Code Regs. 16.01-.05; Vt. Stat. Ann. tit. 21, § 2003 (2009); N.Y.C. Admin. Code § 22-506. That no other jurisdiction has enacted a program like San Francisco’s, either before or after the Ninth Circuit’s initial published opinion in January 2008, is unsurprising. It would be extraordinarily difficult for other jurisdictions to establish the type of non-ERISA compliance option provided by San Francisco’s ordinance: payment into a comprehensive, government-run health care program that the City invested significant public dollars to build, and spends significant tax dollars to maintain. And as discussed further below, other jurisdictions are particularly unlikely to make such investments while Congress debates national health care reform, which could well include a uniform federal employer health care mandate. Petitioner goes on to assert that if additional San Francisco-type programs do come into being, this would “overload the largest human_resources 34 departments and the most expensive software- systems.” Pet. 38. That is preposterous. As discussed above, employers commonly face differing cost (and recordkeeping) requirements in different juris- dictions, including severance pay requirements, minimum and = prevailing wage requirements, vacation pay requirements, apprenticeship and/or training program requirements, taxes, tax credits, fees, and sick leave requirements. Such is the unavoidable, unremarkable consequence of doing business in multiple jurisdictions in the United States. And as discussed more fully by amicus curiae Nibbi Bros. Associates, multijurisdictional employers already regularly use payroll and other human resources software, provided by companies like ADP and Oracle, that are geared to facilitate compliance with disparate loca) requirements of this kind. Petitioner and its allies also fail to account for the HCSO regulations that make it particularly easy for multijurisdictional employers’ to establish compliance. For example, one amicus brief asserts the ordinance will “require employers [with self-insured plans] to create a special pool of funds for San Francisco employees that is separate from the rest of the employees covered by the company plan.” RILA Br. at 13. In truth, a large, multijurisdictional employer with a self-insured plan need only establish that it has spent a certain amount per employee plan- wide. Supra at 4-5. The same is true of a large employer that provides uniform health coverage to its employees through a traditional insurance plan. Id. 35 Of course, if petitioner is correct that numerous laws will sprout up and that they will be unworkable for employers, this also means the Court will have ample opportunity to consider this ERISA preemption issue in future cases. And as discussed below, future cases would have much better records. B. The Case Is A Poor Vehicle For Con- sideration Of Most Arguments Made By Petitioner And Its Allies. Two key contentions in this case have been: (i) the city payment option is not a rational choice for employers; and (11) the ordinance imposes intolerable administrative burdens on employers. Although there was discovery in the district court, petitioner proffered no evidence to support cither contention. Indeed, the record contains significant evidence to refute them both. Accordingly, this case presents a poor vehicle for consideration of an employer’s claim that a general health care spending requirement is preempted by ERISA. With respect to the argument that the city payment option is not a “rational decision” for employers,” petitioner had the burden of making this showing. See, e.g., Dillingham, 519 U.S. at 333 (“it has not been demonstrated here that the added ’ Brief of Amici Curiae the ERISA Industry Committee and National Business Group on Health in Support of Petitioner at a7. 36 inducement created by the wage break available on state publ’: works projects is tantamount to a compulsion upon apprenticeship programs”); Travelers, 514 U.S. at 664 (“no showing has been made here that the surcharges are so prohibitive as to force all health insurance consumers to contract with the Blues”). However, in contrast to Fielder, where Wal-Mart presented unrebutted evidence that Maryland’s law would force it to alter its ERISA pian, 274 F.3d at 193, petitioner submitted no evidence and made no showing that the choice between setting up an ERISA plan and using the city payment opiion was remotely a “Hobson’s choice” for any employer. Travelers, 514 U.S. at 664. In fact, at oral argument in the Ninth Circuit, counsel for petitioner conceded that, if anything, employers had an incentive to choose the city payment option, which contradicted the central contention in petitioner’s briefs in the district court and the Ninth Circuit.'’ And in contrast to petitioner’s non-showing, the City presented unrebutted evidence that the city payment option provides a reasonable alternative. Supra note 3. Petitioner also relies heavily on the argument that the HCSO’s" recordkeeping and_ other administrative obligations are burdensome. Again, this argument is made only at the highest level of abstraction. Petitioner presented no evidence to " See http://www.caQ9.uscourts.gov (Audio Files, No. 07- 17370, first entry, minutes 31:00-34:20). 37 refute the common-sense notion that employers keep records of hours worked, and health care dollars spent, in the normal course of business. Nor did it present any other evidence of the exorbitant administrative burden it now alleges. The only evidence below demonstrated that one of petitioner’s member restaurants — Max’s — already kept the key records, including hours worked per employee and health care expenditures per employee. Resp. App. 60-62. There is no basis, on this record, to conclude that the HCSO’s recordkeeping obligations are anything other than de minimis for employers. C. The Result Sought By Petitioner And Its Allies Would Have A Devastating Impact On The People Of San Francisco. In contrast to the abstract assertions by petitioner and its allies about the impact of the Ninth Circuit’s ruling, the result they advocate would have a real and devastating impact on San Francisco and its residents: the City would be thrust back into the health care crisis that left more than 82,000 people without coverage, and that imposed a tremendous strain on the taxpayers by forcing public emergency rooms to treat illnesses and injuries that could have been prevented. In just 1% years, the number of uninsured declined from roughly 82,000 to under 23,000, and the number continues to go down. Use of public emergency rooms declined seventy percent. Resp. App. 25-30. 38 Nor is the care provided by the City to the previously uninsured limited to traditional “safety net” care. Those enrolled in the HAP are receiving essential preventive and diagnostic treatment for chronic conditions such as asthma, heart disease, diabetes, hypertension or cancer. Resp. App. 25-26. To cite just one example, a former restaurant worker with a chronic heart condition, mitral valve prolapse, was unable to obtain health insurance. She needed surgery for her condition, which would have cost her more than $100,009 if performed at a private facility, rendering it unaffordable for her. Because this person was able to join the HAP, she obtained the surgery, and believes she might not still be alive today if she had been unable to obtain this service from the City’s new program. Resp. App. 26-27. As the City showed in its response to the stay application, the universal] health care program cannot survive without the employer spending requirement. Resp. App. 28-29. See also Brief for Zazie Restaurant as Amicus Curiae in Support of Respondents. Thus, the result petitioner and its allies seek is to terminate San Francisco’s successful, first-of-its-kind universal health care program, based on _ speculation and exaggeration about the as-yet unfelt impact of the Ninth Circuit’s ruling on = multijurisdictional employers. 39 D. The Potential Enactment Of Federal Health Care Legislation Counsels Against A Grant Of Certiorari. Finally, the question presented by the petition may be mooted by national health care reform, so granting certiorari would not be a good use of the Court’s resources. As petitioner and its allies point out, Congress is considering federal legislation that would include a national employer mandate. If the predictions of petitioner and its amici about the enactment of such a law are correct, it would be that new law, not ERISA, that preempts the City’s health care spending requirement. And if that new law preempts local health care spending requirements, the ERISA preemption issue presented here would be relevant only for a relatively brief gap period, until the effective date of the legislation. By the same token, if Congress does not enact health care reform legislation in the next several years, and if other localities then seek to emulate San Francisco’s solution to the health care crisis, the Court will have another opportunity to take up the question at that time. Either way, the present state of flux regarding national health care reform counsels against Court intervention. e 40 CONCLUSION The Court should deny the petition for a writ of certiorari. Respectfully submitted, DENNIS J. HERRERA City Attorney WAYNE SNODGRASS VINCE CHHABRIA Counsel of Record CHRISTINE VAN AKEN Deputy City Attorneys Attorneys for Respondents App. 1 APPENDIX A NO. 08A824 IN THE SUPREME COURT OF THE UNITED STATES OCTOBER TERM, 2008 GOLDEN GATE RESTAURANT ASSOCIATION, Applicant, Uv. CITY AND COUNTY OF SAN FRANCISCO, Respondent, SAN FRANCISCO CENTRAL LABOR COUNCIL; SERVICE EMPLOYEES INTERNATIONAL UNION (“SEIU”), LOCAL 21; SEIU UNITED HEALTHCARE WORKERS-WEST; and UNITE HERE! LOCAL 2, Intervenor/Respondents, On Application to The Honorable Anthony M. Kennedy, Associate Justice of the United States Supreme Court and Circuit Justice for the Ninth Circuit, for Order Staying Mandate and Vacating Stay of District Court Judgment JOINT RESPONSE TO APPLICATION FOR ORDER STAYING MANDATE AND VACATING STAY OF DISTRICT COURT JUDGMENT App. 2 STEPHEN P. BERZON DENNIS J. HERRERA SCOTT KRONLAND City Attorney STACEY M. LEYTON WAYNE SNODGRASS Counsel of Record VINCE CHIHABRIA ALTSHULER BERZON LLP Counsel of Record 177 Post Street, Suite 300 CHRISTINE VAN AKEN San Francisco, CA 94108 Deputy City Attorneys Telephone: (415) 421-7151 City Hall, Room 234 Facsimile: (415) 362-8064 One Dr. Carlton B. Attorneys for Intervenor/ Goodlett Place Respondents San Francisco, CA 94102-4682 Telephone: (415) 554-4674 Facsimile: (415) 554-4747 Attorneys for Respondent li] TABLE OF CONTENTS RE SPE FACS PEA OICL © LIED oo scccccccccccccvcsccscscsssescees il Nee condo sca cacsacveveiedhesssenedasueesiee ces 5 A. The Health Care Security Ordinance ......... 5 B. Procedural Background .................cccceseeeeeees 8 SM EPRREED CPE BOE; VEIG WY .......0.0cccsccceccccsccssscccscesecs ) cee caccinsepvdcaaubacessansdenseseasthanses 11 I. GGRA HAS FAILED TO ALLEGE, MUCH LESS ESTABLISH, IRREPARABLE HARM... = 11 Il. THE EQUITIES MILITATE STRONGLY EE FEA OEE cescesecscccsssiseesscsssessecsssesesene 12 A. The Harm To GGRA And To Other Businesses Is Minimal ...................0ee00ee 13 App. 3 b. A Stay Would Impose Substantial Hard- ship On The City And Its Residents..... 15 iil. TIE CASE IS NOT WORTHY OF CER- FRSA sas ievssisicatsdciee eal 20 A. The Decision Below Does Not Create A Split With The Fourth Circuit .............. 20 B. Other Factors Counsel Against A Grant Je CINE, vakcuc susp ccaxedsaianhavekucteicetsiaueen 24 IV. THE DECISION BELOW IS CORRECT.... 26 CA PI se GIS yaiucdasoniccusscvaveexracetacsas aan 28 [u] TABLE OF AUTHORITIES Federal Cases Barnes v. I}-Systems, Inc. ee FE Rok sen bicdcauin vennkecadnauomeantanameautaneeen 11 Bartlett v. Stephenson ee Goes. EE CIEE knbckcandidcciuseeenecdasistseuvasedianeeeas Ll Cal. Div. of Labor Stds. Enforcement v. Dillingham Constr., N.A. 9 Renew Ramen memento 21, 29 CBS Inc. v. Davis ee ee ee sn en Ce 11 Certain Named and Unnamed Non-citizen Children and Their Parents v. Texas ee ee a re ed eee 11, 12 Fort Halifax Packing Co., Inc. v. Coyne OEE ris 8 Re oivkicidscintesacteristcndarincecse ee App. 4 Golden Gate Restaurant Ass’n v. City and County of San Francisco ee Oe ee EE Ie MI Pincccnnexsccunececaccesesscuccscasas 9 Golden Gate Restaurant Ass’n v. City and County of San Francisco DES F.06 GSe COC CAF. BOGE) vec cseccesecccsscconcsssceces 10, 23 Golden Gate Restaurant Ass'n v. City and County of San Francisco Supreme Court Case No. 07A654.......................042. 10 Hattem v. Schwarzenegger 449 F.3G6 425 (3a Civ, BOOB) .....cccccccoscccccsscvecceccccssssnsBd Keystone Chapter, Associated Builders & Contractors v. Foley Se ee Ee Oe Ge ID on vc censceccctorcnesceceoecsccccenssen 21 Massachusetts v. Morash a casesukueanauens 5, 28, 29 New York State Conf of Blue Cross & Blue Shield Plans v. Travelers Ins. Co 514 U.S. 645 (1995) 5, 21 [iii] Retail Indus. Leaders Ass’n v. Fielder STB F.0G BGO (GG Car, BOOT) vcsscevccccecccvesesenses 4,21, 22 Rostker v. Goldberg 448 U.S. 1306 (1BG0)........cccccosccscceesses cakitee Sane 11 Ruckelshaus v. Monsanto Co. ed le caareacbeenaudaesiadnas 11 S. Cal. IBEW-NECA ‘Trust Funds v. Standard Industrial Elec. Co. 247 F.3d 920 (9th Cir. 2001) 21 Whalen v. Roe ee Site ee rE wens nka vadccncdens sdcccedanstsdudsecscesannaes 1] App. 5 WSB Elec. Inc. v. Curry a Bak oD 21 Federal Statutes 28 United States Code I gg RES AE RE De SEEN ee pn one 10 29 United States Code CD cabuncouucduvddecuececedeudacececksece. 24 Ee ee ee nT i eacdacuuecetcuencdiceuiaes 27 RD co cc acckeevabecnaceccaccececes 28 State Statutes & Codes California Labor Code Tenn nn eet cunusawsguccecedacki 14 California Welfare & Institution Code ON SES ene a ee 18 San Francisco Statutes, Codes & Ordinances Department of Public Health Regulations ASSIA reer yea at orale ot sei ye rr 7 rae eke cal nies wml egunauvinndesdweni 7 liv] Administrative Code EE rns. uvcceecunincoweenddceveuucauesweds 8 Ds dabncusenasuwacce usual 8 (ES EE ES) a ee en ee 6 SRG ENE Be ee eS em eT a 7 I Ste oa adccevaneuskdesisduameduubeckans a UN Es ia BD hea ee ee i ee ....14 App. 6 Rules Supreme Court Rule UE re eee ent ce ace G inna Dia vinnssy VaRvaA neh dame as 10 Other References H. Knight, Not all restaurants back suit over Healthy S.F- San Francisco Chronicle, Mar. 22, 2009 ..................3 House Bill No. 2517 59th Leg., 2006 Reg. Sess. (Wash. 2006)................ 15 House Bill No. 2579 81st Leg., 2006 Reg. Sess. (Kan. 2006) .................. 15 R. Gressman, K. Geller, S. Shapiro, T. Bishop & EK. Hartnett, Supreme Court Practice Re I I ieee aieisrherasecictdndenus -pvivarcnsaevaxsen 11 Senate Bill No. 1414 2065-2006 Reg. Sess. (Cal. 2006)...................2-...--.: 15 Victoria Craig Brunce et al., Health Insurance Mandaies tn the States, Council for Affordable Health Insurance NN ayy iieckcr era tciiesk ints capenueesveuatdencpuoneacsenvertaavarn 28 [1] INTRODUCTION The fatal flaw in the application filed by the Golden Gate Restaurant Association (“GGRA” or “association”) is its failure to provide any reason for emergency intervention. In February 2008, one month after San Francisco’s health care spending requirement took effect, the Circuit Justice denied GGRA’s first application for a stay. Since that time, App. 7 the City’s program has become fully operational, the medium and large employers covered by the ordi- nance have been complying with the spending requirement for 15 months, and tens of thousands of previously-uninsured workers now have _ health coverage under the City’s program. There is no basis for disturbing this status quo while the normal certiorari process runs its course. As a threshold matter, a stay may not issue unless the applicant has demonstrated a likelihood of irreparable harm. Not only has GGRA failed to Gemonstrate irreparable harm — it has not even alleged irreparable harm. The association skips over this prong of the test for a stay entirely, addressing only the three subsequent prongs. This alone requires denial of the stay application. The closest the association comes to touching upon irreparable harm is its assertion that its members, by continuing to make health care expenditures as they have done for the past 15 months, “may” suffer harm for which there is “no effective remedy.” App. at 26. Such a tepid assertion could not establish irreparable harm, even if GGRA had attempted to argue that it did. Indecd, putting aside the general rule that financial loss does not warrant the kind of relief GGRA now seeks, the evidence here suggests there is no financial harm at all. GGRA’s members have passed the cost of the health care spending requirement on to their customers in the [2] form of a health care surcharge, which severely undermines any claim of financial App. 8 harm. See Declaration of Vince Chhabria in Oppo- sition to Application for Order Staying Mandate. In fact, just days after GGRA submitted this application, the association’s own director admitted that the health care spending requirement is “working all right now.” H. Knight, Not all restaurants back suit over Healthy S.F., San Francisco Chronicle, Mar. 22, 2009 at B-1 (CCSF Appendix, Ex. A). Nor would a balancing of the equities justify a stay. In addition to the alleged financial harm to its members, GGRA contends that maintenance of the current status quo would inflict harm on businesses nationwide. The association speculates that other state or local governments might emulate San Fran- cisco’s program, thereby requiring multi-jurisdictional employers to keep track of more than one local health care spending requirement. This argument primarily goes to the merits of GGRA’s preemption challenge. But to the extent GGRA means to argue that laws similar to San Francisco’s will crop up before the certiorari process runs its course (and that this somehow would provide a legal basis for emergency intervention), the argument is baseless. Although GGRA makes opaque reference to “similar” measures having been “proposed,” it does not, and cannot, point to the actual enactment of a single law similar to San Francisco’s since the Court of Appeals allowed the program to take effect 15 months ago. In fact, GGRA does not even cite a proposal that was made after San Francisco’s program took effect — it cites only a law App. 9 review article from 2006 that listed laws proposed before the litigation even began. Pitted against these alleged harms to the asso- ciation are the very real harms that GGRA’s application seeks to inflict upon the City and its [3] residents. As a result of the employer spending re- quirement, more than 37,000 San Francisco workers are now covered through the City’s program. Staying the lower court decision, and thereby enjoining the health care spending requirement, would cause these workers to lose their coverage and access to critical diagnostic and preventive care and_ treatment. Moreover, elimination of the spending requirement could outright destroy San Francisco’s new health care program, forcing the City to revert to the old, failed model of providing emergency care to un- insured people at public hospitals once it is too late to administer proper preventive and diagnostic care. Aside from the equities, the case is not worthy of certiorari. Far from creating a split with the Fourth Circuit’s ruling in Retail Indus. Leaders Ass’n v. Fielder, 475 F.3d 180 (4th Cir. 2007), the decision below operates in harmony with that ruling to stand for the proposition — well established by prior case law — that local governments may impose expenditure requirements on employers so long as those re- quirements do not interfere with plan uniformity. Moreover, the Court need not rush to decide this legal question, because the likelihood is low that other jurisdictions would quickly adopt similar health care programs. Both the success and legality of San App. 10 Francisco's program depend on the existence of a comprehensive, government-run health care delivery system that operates at great expense to the City’s taxpayers. Particularly given current economic condi- tions, it is unrealistic to expect that other juris- dictions will rush to follow suit. In addition, one outcome of the current debate on national health care reform could be to obviate the need for local governments to regulate in this area. Indeed, national health care legislation could moot the legal [4] question at hand, either by preempting programs like San Franciscos or by expressly authorizing them. This possibility suggests the Court should avoid venturing into the national debate on health care reform by deciding a weighty ERISA preemption question that could be mooted before it ever arises again. Finally, even if certiorari were granted, it is unlikely the Court would reverse the decision below. GGRA’s argument on the merits is that employers have the right not to be required to spend money in areas, like health care, mentioned by the ERISA statute. This fails to recognize the distinction between plan uniformity, which ERISA’s preemption provision protects, and expenditure uniformity, which it does not. As the Court has stated, “cost uniformity was almost certainly not an object of pre-emption ...” New York State Conf. of Blue Cross & Blue " 29 U.S.C. § 1002(1). App. 11 Shield Plans v. Travelers Ins. Co, 514 U.S. 645, 662 (1995). And as the Court has explained in cases such as Fort Halifax Packing Co., Inc. v. Coyne, 482 U.S. 1 (1987) and Massachusetts v. Morash, 490 U.S. 107 (1989), there is a reason ERISA’s_ preemption provision explicitly singles out employee benefit “plans,” rather than covering employee benefits generally. See, e.g., Fort Halifax, 482 U.S. at 115 (“Given the basic difference between a ‘benefit’ and a ‘plan,’ Congress’s choice of language is significant in its pre-emption of only the latter”). States and localities may regulate the benefits mentioned in ERISA so long as they do not require alteration of ERISA plans. Because that is precisely what San Francisco’s ordinance does, it is not preempted. [5] STATEMENT A. The Health Care Security Ordinance Because GGRA’s description of the ordinance is incors} ete, and because its discussion of the effects of the ord::.ance on employers and their ERISA plans is inaccurate, we provide a brief description here. In 2006, roughly 82,000 San Francisco adults suffered from a lack of health insurance — more than one-tenth of the City’s population. CCSF Appendix, Ex. B at 3.’ In response to this health care crisis, the * A common misconception about the uninsured is that they are “taken care of” because they qualify for state or federally funded health care programs for the indigent like Medi-Cal (Continued on following page) App. 12 San Francisco Board of Supervisors unanimously passed, and the Mayor signed into law, the Health Care Security Ordinance (“HCSO” or “ordinance”). The ordinance has two key related components — a government health care program and an employer health spending requirement. The government health care program is operated by the San Francisco Department of Public Health (“DPH”). Its primary feature is the Health Access Program (“HAP”), which delivers health care to its participants from a network consisting of San Fran- cisco General Hospital, DPH clinics, and participating non-profit and private providers. S.F. Admin. Code § 14.2(a).* The HAP assigns a primary care physician, nurse practitioner or physician assistant to each participant. And it provides “medical services with an emphasis on wellness, preventive care and [6] inno- vative service delivery.” S.F. Admin. Code § 14.2(f). Among the specific services provided are inpatient and outpatient hospital services, diagnostic and laboratory services, radiological services, mental (California’s Medicaid program). In reality, most people without health care do not qualify for such programs; rather, they simply go without care or resort to trips to the emergency room when it is too late to receive proper preventive treatment (and then are billed for the high cost of such trips). The 82,000 San ‘‘rancisco residents who were uninsured do not include the people who were already enrolled in San Francisco’s indigent health care programs. CCSF Appendix, Ex. B at 4. * The ordinance, along with the implementing regulations, can be found at CCSF Appendix, Ex. B. App. 13 health services, home health care, and prescription drug benefits. Jd. The value of this care is substantial — DPH estimated that in 2008 it cost an average of $261 per participant per month to provide it.* CCSF Appendix, Ex. B at 5. The HAP, which is funded in large part by the City’s general fund, is available to uninsured San Francisco residents, regardless of whether they are employed or unemployed. Enrollees must pay quar- terly participation fees to receive HAP coverage.” The other key component of the HCSO is the employer spending requirement — a mandate that medium and large businesses make minimum health expenditures on behalf of employees who work more than a specified number of hours. Specifically, in 2008 private employers with 20-99 employees and nonprofit employers with 50 or more employees were * Incidentally, DPH changed the name of the HAP program to “Healthy San Francisco” after determining that the name “TJealth Access Program” would create confusion among San Francisco residents because of its similarity to other programs. See DPH Reg. No. 1(b). For purposes of this litigation the parties have continued to use the name contained in the ordinance. * Individual residents who work in San Francisco but live elsewhere do not qualify for HAP participation, but the program contains a feature for those people as well. The ordinance authorizes DPH to establish and maintain medical reimburse- ment accounts for qualified nonresident employees who work in the City. S.F. Admin. Code §§ 14.1(b\7), 14.2(g). Beneficiaries of this aspect of the City’s program may draw from their accounts to obtain reimbursement for medical expenses, including pay- ments of health insurance premiums. DPH Reg. No. 7(g)i). App. 14 required, for any employee who has been employed for 90 days and works more than ten hours per week, to make health care expenditures of $1.17 per hour on behalf of that employee. Private employers with 100 or more employees were required to make health care expenditures of $1.76 per [7] hour on behalf of each covered employee. S.F. Admin. Code. § 14.1(b)(8); OLSE Reg. No. 5.2(A)(1).° It is entirely up to each covered employer to decide how to comply with this spending requirement. The Ordinance defines health care expenditures to mean “any amount paid by a covered employer to its covered employees or to a third party on behalf of its covered employees for the purpose of providing health care services for covered employees or reimbursing the cost of such services for its covered employees.” S.F. Admin. Code § 14.1(b)(7). The ordinance makes clear that employers may set up health care plans themselves, or, of they prefer not to do so, they may make payments to the City on behalf of their workers (hereinafter “the city payment option”). Jd. They may also fulfill the expenditure obligation through a combination of the two. The program is structured so that, if an employer chooses the city payment option, * The amount has increased slightly for 2009: $1.85 per hour for large employers and $1.23 per hour for medium em- ployers. OLSE Reg. No. 5.2(B). GGRA has argued that the amount will skyrocket after 2010, CCSF Appendix, Ex. A, but that is false, and in any event, not relevant to whether a stay should be in effect during the certiorari process. App. 15 it need only write a check and all employees on whose behalf the payment is made will be eligible to receive health care benefits. Covered employees who qualify for HAP mem- bership are, if their employers choose to satisfy the spending requirement by paying the City, entitled to enroll in the program at a 75% discount on the quarterly participation fees they would otherwise be required to pay. DPH Reg. No. 7(f). Furthermore, any covered employee whose fee, after the 75% discount, falls below $50 per quarter is simply allowed to enroll for free. Id. [8] According to studies compiled by the San Francisco Controller’s Office, the large majority — approximately ninety percent — of businesses with 20 or more employees already provided health care benefits to their employees at the time the ordinance was enacted. CCSF Appendix, Ex. B at 9. The average monthly health insurance premium in California at that time was $379. Id. The employer health care spending requirement has now been in effect for 15 months. As a result, 37,000 San Francisco workers are covered under the government health program described above. Decla- ration of Dr. Mitchell H. Katz in Opposition to Application for Order Staying Mandate at J 11. Thousands of others are enrolled in the program separate and apart from any payment made by an employer. Jd. Overall, the number of San Francisco App. 16 residents without health coverage is down to under 23,000, and counting. /d. at 410. B. Procedural Background On December 26, 2007, the district court ruled that the ordinance was preempted by ERISA. The next day, the City and Intervenors filed an emergency application with the United States Court of Appeals for the Ninth Circuit, seeking an order staying the district court’s ruling and allowing the employer spending requirement to take effect pending appeal. On January 9; 2008, the Ninth Circuit granted this request, ordered expedited briefing, and set an accelerated date for oral argument on the merits. Golden Gate Restaurant Ass’n v. City and County of San Francisco, 512 F.8d 1112 (9th Cir. 2008). After waiting more than one month after the emergency application was granted, GGRA filed an application for a stay of the Ninth Circuit’s order with the Circuit Justice. GGRA made arguments that are precursors [9] to the ones it raises in the present application, namely, that restaurants could suffer financial harm if the spending requirement were allowed to take effect, that the ordinance would require them to keep records, and that businesses could be subject to multiple health care spending obligations as a result of the ordinance. The Circuit Justice denied the stay application. Golden Gate Restaurant Ass’n v. City and County of San Francisco, Sup. Ct. Case No. 07A654. App. 17 Oral argument on the merits in the Court of Appeals took place on April 17, 2008, and the panel issued its ruling on September 30, 2008, reversing the district court and concluding San Francisco's ordi- nance is not preempted. Golden Gate Restaurant Ass’n v. City and County of San Francisco, 546 F.3d 639 (9th Cir. 2008) (““GGRA II”). GGRA did not ask the panel for a stay at that time. Instead, it filed a petition for rehearing en banc (but it did not ask the en banc court for a stay either). The en banc petition was denied on March 9, 2009. GGRA Appendix, Ex. F. The mandate issued on March 17, 2009. Meanwhile, San Francisco’s health care spending requirement has been in effect, the restaurants and other em- ployers have been complying with it, and 37,000 workers obtained health coverage from the City’s program as a result. STANDARD OF REVIEW An application for a stay brought pursuant to Supreme Court Rule 23.1 and 28 U.S.C. § 2101(f) may not be granted unless: (1) the applicant demon- strates a likelihood of irreparable harm; (2) the equities favor a stay; (3) there is a reasonable prob- ability that four members of the Court would consider the underlying issue worthy of certiorari; and (4) there is a significant possibility that the Court will reverse the decision below. See, e.g., Certain Named and Unnamed Non-citizen Children and Their Par- ents [10] v. Texas, 448 U.S. 1327, 1330 (1980) (“Non.- citizen Children”) (Powell, J., in chambers). App. 18 It bears emphasis that if an applicant fails to demonstrate a likelihood of irreparable harm, the stay application must be denied for that reason alone, rendering consideration of the other elements of the test unnecessary. See Whalen v. Roe, 423 U.S. 1318, 1316 (1975) (Marshall, J., in chambers) (conclusion that applicant has shown no irreparable harm “necessarily decides the application and renders unnecessary” any consideration of the remaining elements). See also Ruckelshaus v. Monsanto Co., 463 U.S. 1315, 1317 (1983) (Blackmun, J., in chambers). However, if an applicant does demonstrate irreparable harm, this does not obviate the need to inquire whether the equities justify a stay, including whether a stay would be in the public interest. “It is ultimately necessary, in other words, ‘to balance the equities — to explore the relative harms to applicant and respondent, as well as the interests of the public at large.’” Barnes v. E-Systems, Inc., 501 U.S. 1301, 1305 (1991) (Scalia, J., in chambers) (quoting Rostker v. Goldberg, 448 U.S. 1306, 1308 (1980) (Brennan, J., in chambers)). See Generally R. Gressman, K. Geller, S. Shapiro, T. Bishop & E. Hartnett, Supreme Court Practice 873 (9th. ed. 2007). More generally, in the context of an in-chambers stay application, there is a “presumption that the decisions below — both on the merits and on the proper interim disposition of the case — are correct.” Rostker, 448 U.S. at 1308. Accordingly, a Circuit Justice “will grant a stay only in extraordinary circumstances.” Bartlett v. Stephenson, 535 U.S. 1301, App. 19 1304 (2002) (Rehnquist, C.J., in chambers) (quoting Whalen, 423 U.S. at 1316). See, e.g., CBS Inc. vu. Davis, 510 U.S. 1315, 1317 (1994) (Blackmun, in [11] chambers) (“extraordinary circumstances” present where lower court ruling would lead to “indefinite delay” of broadcast that would “cause irreparable harm to the news media that is intolerable under the First Amendment”). ARGUMENT I. GGRA HAS FAILED TO ALLEGE, MUCH LESS ESTABLISH, IRREPARABLE HARM. There is a fatal omission in GGRA’s application. It argues three of the four requirements for a stay: that there is a reasonable probability the Court will grant certiorari, App. at 8, that there is a significant possibility the Court will reverse the decision below, App. at 12, and that the “balance of equities” favors the association. App. at 24. But the application completely omits any discussion of whether there is a likelihood of irreparable harm. GGRA has submitted no evidence, made no factual assertions, and advanced no legal argument about irreparable harm. Accordingly, no further inquiry is needed — the application must be denied for failure to allege, much less demonstrate, irreparable harm. See p. Ll, supra. The only portion of the application that could be construed as relating to irreparable harm (even though GGRA does not characterize it as such) is the statement that, absent a stay, restaurants with more App. 20 than 20 employees will continue making health care expenditures under the ordinance, as they have done for the past 15 months. GGRA asserts that there “may” not be an “effective remedy” for this alleged injury. App. at 26. Putting aside the general rule that monetary injury does not give rise to relief of this kind, cf. Non-cttizen Children, 448 U.S. at 1332-34, in this case the evidence indicates there has been no financial harm at all — irreparable or otherwise. Shortly after the program took effect, restaurants in San Francisco began passing the cost of the health care spending [12] requirement on to their customers, in the form of a “Healthy San Francisco” surcharge. See Chhabria Decl., Ex. A (receipts and menus reflecting surcharge). Indeed, because restaurants have successfully passed ‘on this cost, and because San Francisco restaurant patrons have been widely supportive of it, GGRA’s own director has publicly stated that the health care expenditure requirement is “working all right now.” CCSF Appendix, Ex. A. This statement from GGRA’s director came just days after GGRA submitted its emergency application to the Circuit Justice. Perhaps that is why GGRA is unwilling to allege its members suffer from irrep- arable financial harm. Il. THE EQUITIES MILITATE STRONGLY AGAINST A STAY. Even if one were to assume irreparable harm despite GGRA’s failure to allege it, the equities would | App. 21 not justify a stay. In fact, compared to when GGRA sought a stay from the Circuit Justice 13 months ago, the equities in favor of the City and its residents are now much stronger. Back then, the City had only begun implementing its program, the medium and large employers impacted by the spending require- ment had not yet developed their systems for making health care expenditures, and workers had not yet obtained health coverage as a result of payments by their emplovers. Now, the program is fully opera- tional, the medium and large employers have been making their payments, and roughly 37,000 workers enjoy health coverage from the City as a result. A stay would disturb this status quo by stripping people of their health coverage, and could potentially destroy the City’s new universal health program in the process. (13] A. The Harm To GGRA And To Other Businesses Is Minimal. Aside from GGRA’s tepid and unsupportable assertion of financial hardship, the association claims its members are being harmed by the ordinance’s recordkeeping requirements. App. at 26. But those requirements are neither onerous nor complex. GGRA’s members must maintain itemized pay state- ments, wiiich is already mandated by California Labor Code section 226. The ordinance requires them to maintain the name, address, phone number and first day of work of each employee, and records of health care expenditures made on behalf of those App. 22 employees. And they must file annual reports with the City to prove quarterly compliance, which simply involves dividing the amount spent on health care by the hours worked by covered employees. S.F. Admin Code § 14.3. GGRA has not explained how main- taining these records or reporting this information would harm tis members. Indeed, GGRA has not explained why such information would not already be maintained in the normal course of business. Beyond the purported recordkeeping hardship for GGRA’s members, the association makes passing reference to alleged financial and recordkeeping hardship that other San Francisco employers covered by the ordinance would suffer if the program con- tinues during the certiorari process. However, no other San Francisco employer has challenged the validity of the program, and accordingly there is no reason to assume that businesses other than some of GGRA’s members consider themselves harmed by it. Indeed, the great majority of medium and large employers in San Francisco actually benefit from the health care spending requirement, because they were already providing health insurance to their em- ployees. CCSF Appendix, Ex. B at 9. Any employer that previously spent enough [14] money on health care to satisfy the ordinance is no longer at a competitive disadvantage vis-a-vis the minority of App. 23 medium and large employers that had chosen not to spend money on employee health benefits.’ GGRA next asserts that the decision below inflicts harm beyond San Francisco, because it could cause multi-jurisdictional employers to be subjected to a flood of different health care spending obliga- tions. To the extent GGRA means to contend that multi-jurisdictional employers will be subjected to different spending obligations during the certiorari process, that is without any support. GGRA has not identified a single piece of legislation that has even been proposed, much less enacted, since the Court of Appeals allowed San Francisco’s program to take effect 15 months ago. Instead, it cites a law review article from 2006 — before San Francisco’s ordinance was even enacted — for the proposition that “over thirty similar statutes had been proposed ...” App. at 9 (emphasis added). The claim of impending nationwide hardship during the certiorari process is illusory. Even if proposals like the ones listed in GGRA’s law review article were pending today, this still would not be a hardship. First, many of those proposals were similar or identical to the Maryland law struck ’ Moreover, even these medium and large employers whose health care spending was affected by the ordinance have received a benefit, because their employees have received health coverage as a result, thereby blunting any claim of harm to those busiresses. App. 24 down by the Fourth Circuit, and dramatically dif- ferent from the ordinance San Francisco has enacted.* As discussed in Section III, the Ninth Circuit explained that San Francisco’s ordinance was not preempted precisely because of its differences from the Maryland law. Second, the claim of hardship for [15] miulti-jurisdictional employers presumes that GGRA is correct on the merits — specifically, that loca! governments may not impose spending requirements on employers. But as discussed in Section IV, this Court has already made clear that ERISA does not protect employers from local payment requirements merely because they apply to areas mentioned by ERISA. GGRA’s final claim of hardship relates in some fashion to the stimulus package recently passed by Congress and signed into law by the President. App. at 25. The association observes that the ordinance, by allowing San Francisco employers to comply with the health care spending requirement by making pay- ments to the City for their employees’ benefit, has given those employers a means to provide ‘health coverage that would not be covered by COBRA. It is difficult to understand what hardship this creates. GGRA seems to be assuming that workers who received no coverage prior to the ordinance, but who ® See., e.g., Senate Bill No. 1414, 2005-2006 Reg. Sess. (Cal. 2006); House Bill No. 2579, 81st Leg., 2006 Reg. Sess. (Kan. 2006); House Bill No. 2517, 59th Leg., 2006 Reg. Sess. (Wash. 2006). App. 25 now receive comprehensive coverage from the City, are worse off than before because COBRA does not apply to the HAP. This makes no sense. GGRA’s invocation of COBRA and the stimulus package appears to be nothing more than an attempt to manufacture one issue not already presented in its unsuccessful s‘ay application from last year. B. A Stay Would Impose Substantial Hard- ship On The City And Its Residents. Since San Francisco’s program took effect, the number of residents without health coverage has been reduced from 82,000 to fewer than 23,000. Katz Dec. at 9 10. And as a direct result of the employer spending requirement, more than 37,000 workers now have heaith coverage from the [16] City’s pro- gram. Id. at { 11.° A substantial percentage of those enrolled in the program are receiving essential preventive and diagnostic care for chronic conditions such as asthma, heart disease, diabetes, hypertension or cancer. In all, the HAP has so far provided 73,414 health visits, filled 83,200 prescriptions for medica- tion, and performed 2,350 surgical procedures. 41% of those health visits were for conditions that, if left untreated, would lead to heart disease. Another 45% were for conditions that, if left untreated, would lead * This does not even account for the thousands of workers whose employers chose to provide coverage themselves rather than complying through the city payment option. The City has not yet collected data on this point. App. 26 to hospital-based emergency department overuse. /d. at {{ 12-14. In short, San Francisco is well on its way to resolving its health care crisis. GGRA’s application seeks to force San Francisco back into the old, failed paradigm for health care delivery that the City and its health officials have worked so hard to escape. Most immediately, elimina- tion of the employer spending requirement would deprive these 37,000 workers of their existing health coverage through San Francisco’s program. /d. at 4 15. This loss of coverage would likely cause sub- stantial numbers of these individuals to cancel planned medical visits and surgeries, forego ongoing medical treatment and prescription medicine, and otherwise take health risks that will result in major declines in health and unnecessary hospitalizations. Id. And it has been firmly established that when people lose their health coverage, they receive less care, they are likely to experience major declines in health, and are more likely to be hospitalized. Id. Particularly given that many HAP participants have chronic conditions that require regular treatment and monitoring in order to avoid significant [17] health risks and complications, serious human _ suffering would result if the stay were granted. To cite an example the Director of Public Health provides to illustrate the importance of the program, one former restaurant worker with a chronic heart condition, mitral valve prolapse, was unable to obtain health insurance. She needed surgery for her condi- tion, which would have cost her more than $100,000 App. 27 if performed at a private facility, rendering it unaffordable for her. Because this person was able to join the HAP, she obtained the surgery, and believes she might not still be alive today if she had been unable to obtain this service from the City’s new program. /d. at { 16. GGRA misleadingly suggests none of this matters because San Francisco “already has an obligation,” under state law, “to provide health services to its residents.” App. at 27. What California law actually states is that counties must provide health services to “indigent” residents. Cal. Welf. & Inst. Code § 17000. Residents who qualify for indigent health care services are deemed “insured” for purposes of this measurement, and therefore the residents who qualify as “indigent” for purposes of this code section were not part of the group of 82,000 uninsured residents that existed before the ordinance became operative. CCSF Appendix B at 4. Accordingly, this state law provision will do nothing to diminish the adverse consequences of a stay for San Francisco and its residents. The association also suggests that even if the 37,000 workers lost their existing health coverage, the harm they would suffer is speculative because, should they encounter health problems, they might still seek emergency care at San Francisco General Hospital. App. at 28. But reliance on public hospital emergency rooms to provide care to the [18] unin- sured is the very embodiment of the health care crisis the ordinance seeks to address (and that is now a App. 28 subject of national debate, as discussed infra). As the brief of the California Medical Association demon- strated below, a system that relies on use of emer- gency rooms by the uninsured imposes a tremendous financial strain on local governments, prevents emergency rooms from actually saving lives in true medical emergencies, and deprives the uninsured of the preventive care, diagnostic care, and the monitor- ing they need to avoid emergencies in the first place. CCSF Appendix, Ex. C at 8-12. Following enactment of the ordinance, emergency room visits to San Francisco General Hospital went down almost seventy percent — from 29,976 in the second quarter of 2007 to 8,944 in the second quarter of 2008. Jd. at 5. GGRA’s suggestion that there would be no harm in returning to the old way of dealing with the health care crisis is, to put it charitably, crass. Even beyond the 37,000 workers who are cur- rently covered, shutting down the health care spend- ing requirement could destroy the City’s health care program altogether. If the City were to offer compre- hensive health care to its residents without an employer spending requirement, there would be tremendous incentive for employers that currently provide health insurance to their workers to drop that coverage, on the assumption that the workers will simply be absorbed into the HAP. Indeed, workers themselves might prefer that their employer- based coverage be dropped in exchange for a wage increase, given the availability of comprehensive health coverage from the HAP. The impact of this App. 29 shift could be tremendous — it bears repeating that, prior to enactment of the ordinance, roughly 90% of medium and large employers already provided health insurance to their employees. If even a meaningful portion of those [19] workers were foisted onto the City’s program, the strain on the HAP may be too great to bear. Katz Decl. at 418. The City, in this time of budget shortfalls, cannot realistically be expected to invest the even greater amounts of public dollars that would be necessary to achieve universal health care in the face of widespread cancellation of employer-based health plans, not to mention the loss of tens of millions of dollars in annual revenue the HAP receives from employer payments. Id. at { 11. Finally, the equities tip sharply on the side of the City because it has invested a tremendous amount of money and time to bring the employer spending requirement into operation, all of which would have to be repeated if the requested stay was entered and the law was subsequently upheld. Over the past year, the City has invested hundreds of thousands of dollars on a widespread educational campaign to inform employers of the ordinance and educate them about their compliance options. Katz Decl. at { 7. And it has spent millions of dollars to create enrollment systems and other tools to ensure that employers and their workers would readily benefit from the coverage under the City’s program. Jd. at 9 9. If the health care spending requirement were to be shut down, only to resume again a year later (after favorable ruling by this Court or, say, an act of Congress that explicitly App. 30 authorized the program while the case is. still pending), much of this time and expenditure would have been wasted, and would have to be repeated. Jd. at 7 8. In short, the hardship alleged by GGRA pales in comparison to the harm the City and its residents would suffer should GGRA succeed in its effort to obtain a Stay. [20] Ill. THE CASE IS NOT WORTHY OF CERTIORARI. A. The Decision Below Does Not Create A Split With The Fourth Circuit. The circuits are in agreement that “[wlhere a legal requirement may be easily satisfied through means unconnected to ERISA plans, and only relates to ERISA plans at the election of an employer, it affects employee benefit plans in too tenuous, remote, or peripheral a manner to warrant a finding that the law ‘relates to’ the plan.” Keystone Chapter, Associated Builders & Contractors v. Foley, 37 F.3d 945, 960 (3d Cir. 1994) (internal quotations, citations and brackets omitted). See also Fielder, 475 F.3d at 193; Hattem v. Schwarzenegger, 449 F.3d 423, 429 (2d Cir. 2006); S. Cal. IBEW-NECA Trust Funds v. Stan. rd Industrial Elec. Co., 247 F.3d 920, 925 (9th Cir. 2001); WSB Elec. Inc. v. Curry, 88 F.3d 788, 795 (1996). This agreed-upon rule is based on this Court’s authority, which establishes that local laws which influence choices relating to ERISA plans are not App. 31 preempted unless the influence on an employer’s choice is so great that it amounts to a substantive mandate regarding an ERISA plan. See Travelers Ins., 514 U.S. at 664 (“Although even in the absence of mandated coverage there might be a point at which an exorbitant tax leaving consumers with a Hobson’s choice would be treated as imposing a substantive mandate, no showing has been made here that the surcharges are so prohibitive as to force all health insurance consumers to contract with the Blucs”); see also Cal. Div. of Labor Stds. Enforcement v. Dillingham Constr, N.A., 519 U.S. 316, 332-33 (1997). Far from creating a split, the decisions of the Fourth Circuit in Fielder and the Ninth Circuit in this case, taken together, do nothing more than apply these well-established principles in the context of health care spending. As the Fourth Circuit explained, the spending requirement at [21] issue in Fielder was preempted because it imposed a penalty that forced the employer to alter its ERISA health care plan, while, as the Ninth Circuit explained, San Francisco’s ordinance is not preempted because it creates a comprehensive government health care program into which employers may pay on behalf of their workers, thereby providing them with a reasonable compliance option that does not involve the alteration of an existing ERISA plan or the creation of a new plan. Specifically, Fielder involved a_ preemption challenge to Maryland’s Fair Share Act, which App. 32 provided that any Maryland for-profit employer with more than 10,000 employees that does not spend up to 8% of its payroll on health insurance ({i.e., Wal- Mart) must make up the deficiency by paying it to the Secretary of Labor. /d. at 184. The Secretary of Labor was authorized to use the proceeds of any payments by Wal-Mart to fund Maryland’s Medicaid program. Id. Wal-Mart’s employees would not receive any additional benefits, services, or cost savings in return for such payments. Jd. at 193. Recognizing that a law which “effectively man- dates some element of the structure or administration of employers’ ERISA plans” is preempted while a law that “doles] not bind the choices of employers or their ERISA plans” is generally permissible, the Fourth Circuit concluded that the Fair Share Act fell within the former category and was thus invalid. Jd. at 193. The Court reasoned that the Maryland law effectively required Wal-Mart to alter its ERISA plan because no rational employer would choose to pay this money to the State when it could instead increase health care spending in a manner that benefited its employees: In effect, the only rational choice employers have under the Fair Share Act is to structure their ERISA healthcare benefit plans so as to meet the minimum spending threshold. The Act thus falls squarely under [22] Shaw's prohibition of state mandates on how em- ployers structure their ERISA plans. Td. at 193-194. App. 33 As the Ninth Circuit explained, San Francisco’s ordinance, “[i]Jn stark contrast to the Maryland law, offers employers a meaningful alternative that allows them to preserve the existing structure of their ERISA plans.” GGRA I/, 546 F.3d at 660. Employees whose employers comply through payments to the City, rather than by establishing or altering ERISA plans, receive “tangible benefits” in return. /d. Highlighting the reasonableness of this choice as compared to the penalty in Maryland, 894 employers have selected the city payment option since the health care spending obligation took effect. Katz Decl. at {| 11. That so many employers have selected the city payment option is not surprising, since it allows employers to avoid the inconvenience of setting up their own ERISA plans, while ensuring that their workers will receive comprehensive health coverage from the City at a price far lower than it would cost in the private market.” " Specifically, by simply writing a check to the City, employers avoid a burden that may include hiring an employee benefits consultant, learning about and deciding among the many benefit options, contracting with a third party adminis- trator to maintain the plan and process employee claims, preparing the disclosure documentation required by ERISA, complying with ERISA’s reporting requirements, and potentially exposing themselves to ERISA-related litigation. And the health benefits received by employees from the City will often be extraordinarily generous in relation to the amount paid by the employer. As discussed at pp. 7-9, supra, the average insurance premium in California $379 per month when the ordinance took effect. In contrast, for a medium sized employer with an (Continued on following page) App. 34 [23] Notwithstanding this, GGRA claims an inter-circuit conflict based on the Fourth Circuit’s discussion of an issue that was not presented to, or considered by, the Ninth Circuit here. Specifically, after holding that the option of paying the govern- ment was nothing more than a penalty that forced Wal-Mart to alter its ERISA plan, the court went on to address Maryland’s alternative argument that Wal-Mart had other, private non-ERISA means for complying. These alternatives, according to Mary- land, were to satisfy the spending requirement through the creation and administration of on-site medical clinics, or through the establishment of Health Savings Accounts (“HSAs”). The court rejected this argument on the ground that the purported alternatives were unrealistic. 475 F.3d at 196. And then the court observed that even if Wal-Mart could avail itself of these options, doing so would neces- sarily also produce a change in the company’s ERISA plan: If Wal-Mart were to attempt to utilize non- ERISA health spending options to satisfy the Fair Share Act, it would need to coordinate employee who works 20 hours per week, the employer could satisfy its spending obligation in 2008 by paying the City $93.60 per month. This allowed the employee to obtain a membership that provides comprehensive health services, which cost the City on average $261 per month to provide. In other words, if the employer chooses the government payment option, its employees receive comprehensive health benefits for pennies on the dollar, and the City picks up the rest of the tab. App. 35 those spending efforts with its existing ERISA plans. For example, an individual would be eligible to establish a Health Savings Account only if he is enrolled in a high deductible [ERISA] health plan. See 29 U.S.C. § 223(c)(1). In order for Wal-Mart to make widespread contributions to Health Savings Accounts, it would have to alter its package of ERISA health insurance plans to encourage its employees to enroll in one of its high deductible health plans. From _ the employer’s perspective, the categories of ERISA and non-ERISA healthcare spending would not be isolated, unrelated costs. Decisions regarding one would affect the other and thereby violate ERISA’s preemp- tion provision. Id. at 196-97. As Judge William Fletcher pointed out in his opinion concurring in the denial of rehearing en banc, GGRA and the dissenting judges omit the sentences from the above passage which show that the [24] Fourth Circuit was addressing Maryland’s specific argument pertaining to on-site medical clinics and HSAs. GGRA Appendix, Ex. F. Accordingly, the decisions of the Fourth and Ninth Circuits are not in conflict. Both decisions apply well-established precedent, and their holdings operate in harmony to reaffirm the general ERISA preemption principle — in the specific context of heath care — that while a local government may not effectively force employers to alter or adopt ERISA plans, it may impose spending obligations that allow App. 36 employers to comply while leaving ERISA plans undisturbed." B. Other Factors Counsel Against A Grant Of Certiorari. Particularly given the absence of an inter-circuit conflict, even if the Court believes this ERISA preemption issue may someday be worthy of review, there are substantial reasons to avoid confronting the issue at this time, in the context of this case. First, there is no serious possibility that other jurisdictions will adopt programs like San Francisco’s in the near future. GGRA has cited only measures that were proposed prior to 2006; it does not cite one measure proposed after the Ninth Circuit allowed San Francisco’s program to take effect. Furthermore, many of those pre-2006 proposals were similar or identical to the law struck down by the Fourth Circuit, See p. 15, supra. Under the Ninth Circuit’s reasoning, proposals of this kind have not been given new life. ' GGRA also contends this case is worthy of certiorari because the decision below conflicts with the decisions of this Court. Because, in reality, a ruling striking down San Fran- cisco’s program would require the Court to jettison its existing precedent, GGRA’s contention in this regard is' more appropriately addressed in Section IV, which explains why a majority of the Court would be unlikely to reverse the decision below. App. 37 [25] Moreover, it would be extraordinarily difficult for other jurisdictions to establish the type of reasonable non-ERISA compliance option provided by San Francisco’s ordinance: payment into a compre- hensive, government-run health care program that the City invested significant public dollars to build, and spends significant public dollars (substantially more than that received from employer payments) to maintain. Particularly in this time of financial hardship for state and local governments, it will be challenging indeed to follow in San _ Francisco’s footsteps. Of course, if that turns out wrong, and if GGRA’s dire forecast of multiple health care obligations across jurisdictions bears out, then the Court will have ample opportunity to address the matter in the future. But because there is no reason to credit GGRA’s assertion that multiple laws are on the verge of sprouting up, and because GGRA’s contention that compliance with multiple spending requirements will be unworkable for employers is presently based on pure speculation, intervention by the Court is not required at this time. On a related note, the national discussion on President Obama’s proposal for health care reform is beginning in earnest, and there are reasons for the Court to avoid venturing into that discussion. Generally speaking, the enactment of national heath care legislation could obviate the need for local governments to act separately to address the health care crisis — indeed, this is presumably another App. 38 reason other jurisdictions are not rushing to build programs of the HAP’s magnitude. And if the federal government enacts legislation that includes an employer spending requirement as the President has proposed, this would presumably preempt local requirements like San Francisco’s. Or, national health care reform may take another route, by explicitly authorizing local requirements like |26] San Francisco’s. Either way, the outcome of the health care debate could very well moot the ERISA preemption issue GGRA urges the Court to take up immediately. iV. THE DECISION BELOW IS CORRECT. Finally, even if the Court were to grant certiorari, it would likely affirm the decision below. GGRA’s argument on the merits is that local governments may not subject employers to health care expenditure requirements. This argument rests on the assump- tion that when it comes to matters (like health care) that are mentioned in ERISA, local governments simply may not impose expenditure requirements. This Court has rejected that assumption. Indeed, the Court would be required to repudiate the principles expressed in its existing ERISA preemption cases to rule in GGRA’s favor. Although ERISA’s preemption provision protects employers’ ability to maintain plan uniformity, it does not guarantee expenditure uniformity for employers. For example, in Fort Halifax, the Court held that a App. 39 state law requiring minimum severance pay expen- ditures was not preempted because it did not interfere with plan uniformity. The Court made clear that states and localities may regulate the benefits mentioned in ERISA so long as they do not require alteration of ERISA plans: Appellant’s basic argument is that any state law pertaining to a type of employee benefit listed in ERISA necessarily regulates an employee benefit plan, and therefore must be pre-empted. Because severance benefits are included in ERISA, see 29 U.S.C. § 1002(1)\(B), appellant argues that ERISA pre-empts the Maine statute. In effect, appel- lant argues that ERISA forecloses virtually all state legislation regarding employee benefits. This contention fails, however, in light of the plain language of ERISA’s pre- emption provision, the underlying purpose of that provision, and the overall objectives of ERISA itself.... ERISA’s pre-emption pro- vision does not refer to state laws relating to “employee benefits,” but to state laws [27] relating to “employee benefit plans” ... The words “benefit” and “plan” are used sepa- rately throughout ERISA, and nowhere in the statute are they treated as the equiv- alent of one another. Given the _ basic difference between a “benefit” and a “plan,” Congress’ choice of language is significant in its pre-emption of only [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386017_0619%3A02. Public record. Not legal advice.