Can You Sue the Government For Wasting Your Tax Dollars?

The news broke yesterday that the U.S. House of Representatives voted to sue President Obama over the executive orders he as issued as part of the Affordable Care Act's implementation. This move is fairly unprecedented in American history, and as many suggest, a sign of worsening partisan ire.

In response, a client posed an exasperated series of questions to me: what if you think this pending lawsuit is a huge waste of time and taxpayer money? Is there anything you, as a taxpayer, can do to stop it? Can you sue the House of Representatives for their decision and subsequent actions?

The answers to these questions, generally, is no. You cannot sue the government for wasting your tax money.

In order to sue someone or something in federal court, you need to have "standing." Standing is a legal term that has three main components: an injury-in-fact, causation, and redressability. In simple terms, the plaintiff has to have suffered an actual harm (such as significant loss of money, a physical injury, or some lost form of freedom), the harm must be attributable to the person or organization the plaintiff is suing, and the court in which the plaintiff sues must have some power to repair the harm or prevent it from happening in the future.

There are other, "prudential" limitations on standing. For example, you can't sue on behalf of someone else (except in certified class actions, which require a specific analysis), and you can't sue over "generalized grievances" such as political disputes or ideological disagreements. Also, generalized "taxpayer standing," where a taxpayer alleges that the government has harmed him by wasting his money or by otherwise abusing its power to spend, has been generally rejected.

In 1923, the Supreme Court decided the case of Frothingham v. Mellon, in which a taxpayer sued the U.S. Government for spending money in a way that could increase the need for more tax revenue, and therefore require tax increases in the future. The Court ruled the plaintiff, as a taxpayer, had no standing:

[Plaintiff's] interest in the moneys of the Treasury -- partly realized from taxation and partly from other sources -- is shared with millions of others; is comparatively minute and indeterminable; and the effect upon future taxation, of any payment out of the funds, so remote, fluctuating and uncertain, that no basis is afforded for an appeal to the preventive powers of a court of equity.

The administration of any statute, likely to produce additional taxation to be imposed upon a vast number of taxpayers, the extent of whose several liability is indefinite and constantly changing, is essentially a matter of public and not of individual concern.

262 U.S. 447, 487 (U.S. 1923). So not only was the injury alleged by the taxpayer plaintiffs too "minute and indeterminable," but the issue in the case was a "matter of public concern" --- a political matter. In other words, if you don't like the way your government is spending your tax money, you can vote the bums out. But disagreeing with the way government spends, even if it means you'll have to pay more in taxes later on, is not a sufficiently determinable injury for the courts to provide any remedy.

The Court rejected a similar taxpayer lawsuit in the case of Doremus v. Board of Educationbecause the plaintiff lacked a "direct and particular financial interest" in the challenged government action. 342 U.S. 429, 434 (1952).

The Supreme Court has rejected that there is an absolute bar to "taxpayer standing," however.

For example, in 1968, a group of taxpayer plaintiffs alleged that the federal Elementary and Secondary School Act of 1965 violated the Establishment Clause of the First Amendment. The law allocated federal funds for use by religious schools. The Supreme Court discussed the doctrine of standing at great length, and then found:

A taxpayer may or may not have the requisite personal stake in the outcome, depending upon the circumstances of the particular case. Therefore, we find no absolute bar in Article III [of the Constitution] to suits by federal taxpayers challenging allegedly unconstitutional federal taxing and spending programs.

Flast v. Cohen, 392 U.S. 83, 101 (U.S. 1968).

The Court went on to say that a plaintiff must demonstrate a certain two-prong nexus between their status as a taxpayer and the governmental act they're challenging. Taxpayers may only challenge exercises of constitutional power under the taxing and spending clause, and they have to show that the challenged exercise is in excess of that clause, i.e., that it's unconstitutional.

More recently, though, the Court has reasserted that taxpayers will rarely have standing to challenge government expenditures because it's difficult to ascertain either an actual injury suffered or a way in which the court could provide a remedy:

Difficulties persist even if one assumes that an expenditure or tax benefit depletes the government's coffers. To find injury, a court must speculate that elected officials will increase a taxpayer-plaintiff's tax bill to make up a deficit. And to find redressability, a court must assume that, were the remedy the taxpayers seek to be allowed, legislators will pass along the supposed increased revenue in the form of tax reductions. It would be pure speculation to conclude that an injunction against a government expenditure or tax benefit would result in any actual tax relief for a taxpayer-plaintiff.

Ariz. Christian Sch. Tuition Org. v. Winn, 131 S. Ct. 1436, 1444 (2011) (internal quotations and citations omitted). The Court ruled that the plaintiffs in this case did not qualify under the narrow Flast exception, and closed with the following pronouncement:

Few exercises of the judicial power are more likely to undermine public confidence in the neutrality and integrity of the Judiciary than one which casts the Court in the role of a Council of Revision, conferring on itself the power to invalidate laws at the behest of anyone who disagrees with them.

Id. at 1449.

So, the simple answer to my client's question is: no, you can't sue Congress as a taxpayer for wasting your tax money by suing the President. The more nuanced answer would be: maybe, but only if you can show that you've suffered a distinct injury, it was caused by Congress suing the President, the court can do something to fix your injury, and suing the President is beyond Congress' power under the taxing and spending clause of the Constitution. That's a fairly tall order, I would say.