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Today the United States Supreme Court ruled that Section 3 of the federal Defense of Marriage Act (DOMA) is unconstitutional. The case, United States v. Windsor, 570 U.S. ____ (2013), involved the portion of DOMA that stated that the federal government will only recognize marriages between opposite-sex spouses for purposes of federal law. There are over 1,000 federal laws that address marital status, and DOMA’s Section 3 denied validly married same-sex couples myriad protections and responsibilities under federal law. Because of the Windsor decision, same-sex spouses who are validly married under state law will now also be treated as married under federal law.

Edith Windsor married Thea Spyer, her partner of 46 years, in Ontario, Canada, in 2007. At the time, their state of residency, New York, did not allow same-sex marriage, but it did recognize the validity of their Canadian marriage. When Ms. Spyer died in 2009, she left her entire estate to Ms. Windsor. Ms. Windsor filed Ms. Spyer’s federal estate tax return and claimed that she was owed a refund of $363,053 as the surviving spouse. Under federal tax law, property passing from a deceased spouse to a surviving spouse is not subject to estate tax. However, DOMA prevented the IRS from recognizing Ms. Windsor and Ms. Spyer’s marriage, and the refund claim was denied. The federal District Court and the Second Circuit Court of Appeals ruled in favor of Ms. Windsor, holding that the applicable provisions of DOMA were unconstitutional and ordering that the Treasury refund the estate tax paid to Ms. Windsor with interest. The government appealed that decision to the U.S. Supreme Court.

In today’s U.S. Supreme Court decision, Justice Kennedy, writing for the majority, stated Section 3 of DOMA violates the due process and equal protection principles of the Fifth Amendment to the U.S. Constitution because it was principally designed to impose an unequal status on otherwise validly married same-sex couples. Specifically, Section 3 tells these couples that “their otherwise valid marriages are unworthy of federal recognition . . . plac[ing] same-sex couples in an unstable position of being in a second-tier marriage.” Slip op. at 23. To the extent that a state has chosen to allow same-sex marriage, the U.S. Constitution prohibits the federal government from imposing “a disability on the class [of same-sex spouses] by refusing to acknowledge a status the State finds to be dignified and proper.” Slip op. at 25.

Although the decision takes effect immediately, I would caution same-sex spouses to expect some glitches along the way. Because of the number of federal laws that are tied to marital status, it will likely take weeks and months for various state and federal agencies to fully adjust to this change, educate their employees, and issue the appropriate regulations.

For same-sex couples doing their estate planning, this decision may have a major effect on the structure of their estate plan. For example, same-sex spouses are now eligible for the federal estate tax marital deduction (and so may use “QTIP” trusts and make portability elections); they may now make unlimited lifetime gifts to their spouses; and they are now eligible for spousal status on retirement accounts. For same-sex spouses with estate plans currently in place, I would strongly recommend contacting your lawyer to discuss whether the Windsor decision will affect you.

It is important to note that this ruling only applies to lawful same-sex marriages. Currently, 13 states, the District of Columbia, and a number of Native American tribes currently allow same-sex marriage or have laws legalizing same-sex marriage set to go into effect this year. Because of the Supreme Court’s decision in Hollingsworth v. Perry this morning (see Marriage Equality Returns to California), California is included among those states. Additionally, Windsor does not affect Section 2 of DOMA, which permits states to refuse to recognize same-sex marriages performed in other states.

For those who wish to read the case in full, Windsor has somewhat of an unusual procedural history, as the Executive Branch (which enforces DOMA) asserted that it believed that DOMA was unconstitutional and declined to defend it in court, but it continued to enforce DOMA and denied Ms. Windsor’s estate tax refund. The U.S. House of Representatives, through the Bipartisan Legal Advisory Group (BLAG), defended the law instead. After a significant amount of debate as to whether the U.S. Supreme Court had jurisdiction to hear the case and BLAG had standing to defend DOMA, the Supreme Court determined that it had jurisdiction and reached the merits of the case. A substantial portion of the majority opinion and the dissenting opinions focuses on this issue.

The United States Supreme Court issued its opinion in Hollingsworth v. Perry, 570 U.S. ___ (2013), this morning, regarding the validity of Proposition 8. The outcome is that same-sex marriage is once again legal in California. The Supreme Court did not rule on a specific right to same-sex marriage, but rather it stated that neither it nor the federal Court of Appeals for the Ninth Circuit (which includes California) had the power to hear the case. Hollingsworth is largely a procedural case, and it requires some background to fully understand.

In 2008, the California Supreme Court held that the California Constitution’s equal protection clause prohibited limiting marriage to opposite-sex couples. Shortly thereafter, California voters passed Proposition 8, which amended the state constitution to restrict marriage to opposite-sex couples. The Respondents in Hollingsworth, two same-sex couples, filed suit against various California state and local officials in federal District Court asserting that Proposition 8 was invalid under the Fourteenth Amendment of the U.S. Constitution. California state officials declined to defend Proposition 8, and the District Court allowed the Proponents (the parties who put Proposition 8 on the ballot) to defend it. The District Court then declared Proposition 8 unconstitutional, and state officials declined to appeal. The Proponents then appealed to the Ninth Circuit Court of Appeals. The Ninth Circuit ultimately held that Proposition 8 was unconstitutional, and the Proponents appealed to the U.S. Supreme Court. Even though the Ninth Circuit found Proposition 8 to be unconstitutional, it put a “stay” in place, meaning that same-sex marriages were put on hold while the appeal to the Supreme Court was pending.

In order for a case to be heard in federal court, the U.S. Constitution requires that there must be an “actual controversy” and parties must have standing; that is, there must be a concrete and personal injury to the parties that can be remedied. Generalized injuries are typically not sufficient to confer standing, nor is being a “citizen” or a “taxpayer.” In Hollingsworth, the Respondents had standing to sue in the District Court because they had an actual injury – California’s refusal to permit them to marry. Once they won and the state declined to appeal, their injury had been fully redressed. The Proponents of Proposition 8 contended that they had standing to appeal the decision to the Ninth Circuit (and subsequently the Supreme Court) because of their special role in the ballot initiative process. The Ninth Circuit eventually concluded that the Proponents had standing, but Proposition 8 was unconstitutional.

However, the U.S. Supreme Court today has reversed the Ninth Circuit and stated that the Proponents lacked standing because they failed to show a particularized harm. Even though they were the driving force behind putting Proposition 8 on the ballot, once it passed, the Proponents’ interest in defending the law became indistinguishable from the general interest of every other Californian. Further, the Proponents did not qualify as “agents” of the state or the people of California, and thus had no special status that might confer standing.

Because standing is a threshold question in federal court, the U.S. Supreme Court did not reach the merits of the Hollingsworth case. This means they did not rule on whether Proposition 8 is unconstitutional. The Supreme Court vacated the Ninth Circuit’s judgment that Proposition 8 is unconstitutional and sent the case back to the Ninth Circuit with instructions to dismiss it because the Proponents lack standing to bring their case in federal court.

The next step will be for the Ninth Circuit Court of Appeals to officially dismiss the case and lift the stay. Once the stay is lifted, the District Court’s decision that Proposition 8 is unconstitutional under the U.S. Constitution will go into effect. Governor Jerry Brown has already ordered the California County Clerks’ offices to begin issuing marriage licenses to same-sex couples at that time. The Proponents have stated that they will continue to pursue legal action to enforce Proposition 8, but for the time being, same-sex marriage will once again be legal in California as soon as the Ninth Circuit acts.