"Standing" is the doctrine under Article III of the U.S. Constitution which limits the jurisdiction of federal courts to actual "cases or controversies." In practice, this means that a plaintiff must demonstrate that (1) it has suffered an injury in fact; (2) caused somehow by the conduct complained of; and (3) a favorable judicial ruling will likely redress that injury. Virginia attempted in effect to create that injury by passing a law the day after the ACA was signed, the Virginia Health Care Freedom Act (VHFCA), stating that "no resident of this Commonwealth . . . shall be required to obtain or maintain a policy of individual insurance coverage.”
But that, writes Judge Diane Gribbon Motz for the panel, was not enough for Virginia to claim any injury here. See, states can't sue on behalf of their citizens to protect them from the federal government, and this statute was nothing more than a "smokescreen" to attempt to do so. This, gang, is Federal Supremacy 101:
Contrary to Virginia’s arguments, the mere existence of a state law like the VHCFA does not license a state to mount a judicial challenge to any federal statute with which the state law assertedly conflicts. Rather, only when a federal law interferes with a state’s exercise of its sovereign “power to create and enforce a legal code” does it inflict on the state the requisite injury-in-fact....Judge Motz's opinion explains the dangers of Virginia's approach:
[T]he VHCFA regulates nothing and provides for the administration of no state program. Instead, it simply purports to immunize Virginia citizens from federal law. In doing so, the VHCFA reflects no exercise of “sovereign power,” for Virginia lacks the sovereign authority to nullify federal law....
Moreover, the individual mandate does not affect Virginia’s ability to enforce the VHCFA. Rather, the Constitution itself withholds from Virginia the power to enforce the VHCFA against the federal government. Given this fact, the VHCFA merely declares, without legal effect, that the federal government cannot apply insurance mandates to Virginia’s citizens. This non-binding declaration does not create any genuine conflict with the individual mandate, and thus creates no sovereign interest capable of producing injury-in-fact.
To permit a state to litigate whenever it enacts a statute declaring its opposition to federal law, as Virginia has in the VHCFA, would convert the federal judiciary into a “forum” for the vindication of a state’s “generalized grievances about the conduct of government.” Under Virginia’s standing theory, a state could acquire standing to challenge any federal law merely by enacting a statute -- even an utterly unenforceable one -- purporting to prohibit the application of the federal law. For example, Virginia could enact a statute declaring that “no Virginia resident shall be required to pay Social Security taxes” and proceed to file a lawsuit challenging the Social Security Act. Or Virginia could enact a statute codifying its constitutional objection to the CIA’s financial reporting practices and proceed to litigate the sort of “generalized grievance” about federal administration that the Supreme Court has long held to be “committed to the . . . political process.”And because Virginia had no standing to sue, there was no reason to reach the merits and decide whether the individual mandate was indeed constitutional.
I ran the math to see if this case could make it to the Supremes by term's end (bottom line: yes, if Cuccinelli can rush his cert petition in two months), but it's irrelevant; the parties who lost the 6th Circuit decision upholding the Act have already filed their cert petition (online here), so if the Supremes want to rule on the merits before next summer they will have their chance.