This is a rush transcript from "On the Record," April 5, 2010. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: There is breaking news in the fight over health care. President Obama and Democrats, look out! Because two more state attorneys generals just joined the lawsuit filed against the federal government, the state attorneys general in Indiana and North Dakota joining Alabama, Colorado, Florida, Louisiana, Michigan, Nebraska, Pennsylvania, South Carolina, Texas, Utah, Washington, South Dakota and Idaho. And then there is Virginia, which filed a separate lawsuit challenging the health care legislation. If you were not counting, that is 16 states!

Indiana attorney general Greg Zoeller, the newest member of the lawsuit, joins us right now. Good evening, sir.

GREG ZOELLER, R - INDIANA ATTORNEY GENERAL: Hi, Greta. Good to be with you.

VAN SUSTEREN: Sir, it's sort of interesting. In looking at the -- Indiana's path to this -- to joining this lawsuit, I understand that you previously did research for Senator Lugar, senator from your state. Tell me why you did that, when you did that and what you learned.

ZOELLER: Well, Greta, there's a statute in Indiana that allows the legislators, the congressmen and senators from our state, to ask the attorney general to do an investigation and report on any federal statute that's being proposed and how it would impact the state of Indiana, as well as how we see it in terms of federal authority, whether it encroaches on a state. So Senator Lugar asked for an opinion, this research to be done back in January. In February, we produced a 55-page report which actually does quite a bit of analysis both on the impact on Indiana particularly and on some of the legal questions that are now in front of everybody's mind.

VAN SUSTEREN: All right, in terms of the impact, the legal impact, tell me, what is it that your office concluded? And this is well before the legislation was even signed, but of course, there at least was a December 24th Senate bill that everyone was talking about. What did your conclusion -- what was your conclusion, your office's conclusion?

ZOELLER: Well, I didn't say that it was unconstitutional. What I said, that it was unprecedented. There's open questions that have not been asked and answered before the U.S. Supreme Court. It's one more step that the federal government is taking in terms of breathing additional authority into the commerce clause.

Frankly, there's very questions about whether they have this authority. And I think it's incumbent upon the attorneys general who represent states' sovereign authority, as well as the individuals that reside in our state. So I think it's really part of the job description to check to see whether the federal government actually has this authority that they claim in this statute.

VAN SUSTEREN: And you're -- and you're talking about the mandate in particular, zeroing in on whether the federal government can essentially order people to buy health insurance. Am I correct in that?

ZOELLER: Well, there's two main things. First the individual mandate. For the first time ever, the federal government will require individuals to purchase a commercial product. And it's really -- even in the -- even in all the years that they've had additional authority breathed into it through the commerce clause, this isn't really regulating any activity between the states or even within the states. You're really talking about regulating inactivity. You don't have to do anything. Even if you're just wanting to be left alone, you're still required to do this. This is not a federal program, this is the requirement that you purchase a commercial product.

So again, it's unprecedented. I can't say that it's unconstitutional, but I can say there's not a case on point that says that the federal government has this authority.

VAN SUSTEREN: All right, now, you're a Republican. Your governor is Republican. So I take it you're not taking heat from the governor. What has been the reaction in the community? Are you able to tell, or is it too soon?

ZOELLER: Well, I've -- I think there's an overwhelming sense of concern from Hoosiers. Actually, those who aren't watching the basketball game tonight might be watching this. And they're all kind of concerned that the federal government has always kind of encroached on their personal lives, as well as the state's role in their lives. So I think the idea that -- people in Indiana are very worried about this.

I did take a little bit of heat from some of the Democrat members of the legislature saying I would spend too much money or that there was some other questions about whether this was political. But frankly, it's all been politicized by the way this was done in Washington, on strictly a partisan vote. So the Republicans in my state have all been kind of encouraging me. But frankly, everybody who wants to have the Supreme Court raise this question before the Supreme Court so we can know whether the federal government has this authority -- they're all kind of encouraging me to do this.

VAN SUSTEREN: Attorney General, thank you sir.

ZOELLER: Oh, you're more than welcome.

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