Loma Linda University Kidney Center v. Burwell

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

LOMA LINDA UNIVERSITY KIDNEY

CENTER,

Plaintiff,

Civil Acti0n No. 15-01717 (TFH)

V° Consolidated with

SYLVIA M. BURWELL,

Secretary, Department of Health and

Human Services,

Defendant.

LOMA LINDA UNIVERSITY MEDICAL

CENTER,

Plaintiff,

V.

Civil Acti0n No. 15-01721 (TFH)

SYLVIA M. BURWELL,

Secretary, Department of Health and

Human Services,

Defendant.

MEMORANDUM ()PINION & ORDER

Pending before the Court is plaintiffs’ Motion for Leave to Conduct Discovery and to

Supplement the Administrative Record [ECF No. 17]. The Secretary has filed an opposition

[ECF No. 19], and plaintiffs a reply [ECF No. 20]. Upon consideration of the parties’ t`ilings, the

Court’s March 3, 20l6 Order [ECF No. l6], and the entire record herein, the motion will be

denied and a briefing schedule for dispositive motions will be set.

This case stems from the Department of Health and Human Services’ denial of plaintiffs’

applications for exceptions to the payment rate for reimbursement of renal dialysis treatment

services. Plaintiffs submitted their applications on August 28, 2000. The Centers for Medicare

& Medicaid Services ("CMS") issued the agency’s initial decisions, dated November l5, 2000,

denying plaintiffs’ applications on the merits.

On administrative appeal, the Provider Reimbursement Review Board (the "Board")

reversed the November l5, 2000 CMS decisions, finding that the applications should have been

deemed approved because CMS did not provide notice of its decisions within 60 working days as

required by 42 U.S.C. § l395rr(b)(7) (providing that "[e]ach application . . . shall be deemed to

be approved unless the Secretary disapproves it by not later than 60 working days after the date

the application is filed"). The Board concluded the issue whether CMS’s denials of the

applications were otherwise proper was moot.

The CMS Administrator (the "Administrator"), however, reversed the Board’s decisions,

concluding instead that CMS timely denied plaintiffs’ applications within 60 working days, even

if it did not provide notice of its decisions until later. The Administrator reasoned that

section l395rr(b)(7) does not require that plaintiffs receive notice of the disapproval within the

statutory time period, but rather, requires only that CMS render the disapproval of the

applications within the 60-working day statutory period. The Administrator did not address

whether CMS’S denials of the applications were otherwise proper.

Plaintiffs each sought judicial review under the Administrative Procedure Act ("APA"),

their cases were consolidated, and the parties filed cross-motions for summary judgment.

Plaintiffs also filed a motion to compel the production of any CMS logs reflecting the date upon

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which the November 15, 2000 denial letters were actually signed and mailed. Plaintiffs insisted

their applications should have been deemed approved because, inter alia, section 1395rr(b)(7)

requires that CMS provide notice of its decision within the 60-working day statutory period.

On January 28, 2011, this Court granted in part and denied in part the Secretary’s motion

for summary judgment, granted in part and denied in part plaintiffs’ motion for summary

judgment, and affirmed a Magistrate Judge’s denial of plaintiffs’ motion to compel. Loma Lz`na’a

Univ. Kia’ney Ctr. v. Sebelius, Civ. Nos. 06-1926 & 06-1927, 2011 WL 13063635, at *1, *10

(D.D.C. Jan. 28, 2011) ("Loma Lina'a 1"). In granting partial summary judgment in favor of the

Secretary, this Court upheld the Administrator’s interpretation of 42 U.S.C. § l395rr(b)(7) as

requiring only that CMS render its disapproval of the applications within the 60-working day

statutory period, which interpretation this Court found was entitled to deference under Chevron

USA, ]nc. v. Natural Res. Def Councz'l, Inc., 467 U.S. 837 (1984). Loma Lina’a I, 2011 WL

13063 63 5, at *2-3. Additionally, regarding plaintiffs’ motion to compel, the Court concluded

that plaintiffs failed to demonstrate that supplementation of the administrative record through

discovery was warranted where the Secretary did not deliberately or negligently exclude any

CMS logs from the administrative record and the exclusion of any such logs from the

administrative record would not frustrate judicial review. Id. at *8-10. The Court further

concluded that, with respect to the Administrator’s determination that CMS’s denials were

rendered on November 15, 2000, "the record [is] adequate to find that the Administrator’s

decision[s] [are] not arbitrary, capricious, or based on insubstantial evidence in this respect." Ia’.

at *9. However, because the Administrator’s final decisions addressed only the timeliness issue

and not the merits of plaintiffs’ applications, the Court concluded that "the Administrator’s

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decision[s] [are] arbitrary and capricious and a remand is necessary . . . for a determination on

the merits of Plaintiffs’ applications[.]" Id. at *4, *10.

Plaintiffs attempted to appeal this Court’s January 28, 2011 ruling to the United States

Court of Appeals for the District of Columbia Circuit ("D.C. Circuit"), but the Secretary filed a

motion to dismiss, which the D.C. Circuit granted. Specifically, the D.C. Circuit concluded that

this Court’s order was not yet final because it included a remand to the agency for further

proceedings-the D.C. Circuit noted that "[o]nce the proceedings on remand are concluded,

appellants, if still aggrieved, may retum to district court, and appeal any still-disputed part of the

remand order as well as any district court ruling made after the remand." Sept. 14, 2011

Mandate of United States Court of Appeals [Civ. No. 06-1926, ECF No. 59; Civ. No. 06-l927,

ECF No. 31].

On remand before the agency, the Board rendered decisions on September l, 201 5,

finding that CMS properly denied plaintiffs’ applications_the Board declined to address the

timeliness issue. Pls.’ Mot. at 7; Def.’s Opp’n at 8; Pls.’ Reply at l. Because the Administrator

declined to review the Board’s decisions, they became the agency’s final decisions on this

matter. Pls.’ Mot. at 8; Def.’s Opp’n at 8 (citing 42 U.S.C. § 1395oo(f)). Again, plaintiffs each

sought judicial review under the APA and their cases were consolidated.

Now, in their pending Motion for Leave to Conduct Discovery and to Supplement the

Administrative Record, plaintiffs ask the Court for leave to conduct "limited discovery solely for

the purpose of obtaining a factual record pertaining to the following two issues, (a) the date upon

which the denial letters dated November 15, 2000 were signed, and (b) the date upon which the

denial letters were mailed to the intermediary." Pls.’ Mot. at 14. However, discovery in APA

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review cases "is the exception, not the rule," e.g., Pac. Shores Subdivision, Calzfornz`a Water

Dz`st. v. U.S. Army Corps of Engineers, 448 F. Supp. 2d l, 5 (D.D.C. 2006) (citing Motor &

Equip. M}‘rs. Ass ’n Inc. v. EPA, 627 F.Zd 1095, 1105 n.l8 (D.C. Cir. l979)). And plaintiffs fail

to persuade the Court that an exception to the rule is warranted here, as might be the case where,

for example, "the agency deliberately or negligently excluded documents that may have been

adverse to its decision" or the incompleteness of the administrative record "frustrates judicial

review." James Maa'ison Ltd. by Hecht v. Laa’wig, 82 F.3d 1085, l095l(D.C. Cir. l996).

At bottom, plaintiffs seek to re-litigate the timeliness issue, but this issue is controlled by

the law of the case. "[T]he law~of-the~case doctrine [provides that] the same issue presented a

second time in the same case in the same court should lead to the same result." LaShawn A. v.

Barry, 87 F.3d 1389, 1393 (D.C. Cir. 1996); see ia’. (noting that "[i]nconsistency is the antithesis

of the rule of law" and that "[f]or judges, the most basic principle of jurisprudence is that we

must act alike in all cases of like nature" (intemal quotation marks omitted)). The doctrine is

applicable to "questions decided ‘explicitly or by necessary implication."’ Ia’. at 1394 (citation

omitted). Indeed, "the law of the case [doctrine] turns on whether a court previously ‘decide[d]

upon a rule of law’ . . . [,] not on whether, or how well, it explained the decision." Chrz`stianson

v. Colt Ina’us. Operating Corp., 486 U.S. 800, 817 (1988). The Court’s prior ruling in this case

clearly (l) upheld the Secretary’s interpretation of 42 U.S.C. § l395rr(b)(7) as only requiring

that CMS render its disapproval of the applications within the 60-working day statutory period,

(2) denied plaintiffs’ motion seeking discovery regarding when Cl\/IS’s November l5, 2000

decisions were actually signed and mailed, and (3) concluded that the record is adequate to find

that the Administrator’s determination that CMS’S denials were made on November l5, 2000

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was "not arbitrary, capricious, or based on insubstantial evidence in this respect." Loma Lina'a I,

201 l WL 13063635, at *2-3. In short, the Court at least implicitly, if not expressly, affirmed the

Administrator’s determination on the timeliness issue.

Plaintiffs argue that the administrative record does not contain sufficient information to

enable this Court to render a decision regarding the timeliness issue--i.e., that the

incompleteness of the administrative record frustrates judicial review. Pls.’ Mot. at 9-13. But

plaintiffs miss the point: the timeliness issue has already been decided and, therefore, judicial

review of this issue (at least by this Court) is foreclosed by the law of the case doctrine.

Although the Court is not required to adhere to the law of the case in situations where "there is

an intervening change in the law or [where] the previous decision was ‘clearly erroneous and

would work a manifest injustice,"’ Kimberlz`n v. Quz`nlan, l99 F.3d 496, 500 (D.C. Cir. 1999)

(quoting LaShawn A., 87 F.3d at 1393), neither situation applies here. Plaintiffs invite the Court

to revisit its earlier ruling in light of the D.C. Circuit’s subsequent holding in Guna'erson

Lutheran Mea’. Ctr., Inc. v. Sebelz`us, 666 F.3d 1335, l336 (D.C. Cir. 2011), which, they assert,

"requires that the Court determine the date upon which the CMS decisions were communicated"

to decide whether the agency’s decision satisfied the 60-worl<ing day requirement under section

l3951r(b)(7). Pls.’ Mot. at 10. However, although the D.C. Circuit in Gunderson concluded that

CMS had satisfied the 60-working day requirement where it had provided notice of its decision

prior to the 60th working day, the D.C. Circuit clarified that even "i£ for some hypothetical

reason, [CMS]’s decision was not available to the applicant in a timely manner, the relevant

question would be how to interpret the appeal regulation--not [section l395rr(b)(7)]." 666 F.3d

at 1337 (emphasis added). Thus, the D.C. Circuit’s holding in Gunderson does not amount to a

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change in the law that would warrant this Court revisiting the timeliness issue. And plaintiffs

otherwise fail to assert, much less demonstrate, that the Court’s previous decision was clearly

erroneous and would work a manifest injustice

Plaintiffs further argue that the Secretary deliberately or negligently excluded documents

(i.e., the aforementioned CMS logs) that may have been adverse to the agency’s decision when

compiling the administrative record in this case. See Pls.’ Mot. at 8-9, l3-l4. The Court

disagrees. As noted above, the Court previously ruled that the Secretary had not deliberately or

negligently excluded CMS logs from the administrative record in Loma Lina’a 1, at which point

the timeliness issue was still an open question. The timeliness issue having been decided, the

Court concludes that the Secretary, a j`ortz`ori, did not deliberately or negligently excluded any

CMS logs from the administrative record in these actions concerning the merits of plaintiffs’

applications.l

In sum, plaintiffs fail to demonstrate that supplementation of the administrative record

through discovery is warranted. See Lua'wig, supra.

l Plaintiffs flog the proverbial dead horse one last time in their reply brief, asserting that the D.C. Circuit’s order

dismissing their prematurely-filed appeal provides that the timeliness issue is properly before this Court. Pls.’ Reply

at 2. This assertion reflects, at best, a strained reading of the D.C. Circuit’s order, which this Court reads as follows:

"Once the proceedings on remand are concluded, appellants, if still aggrieved, may return to district court, and appeal

[to the court of appeals] any still-disputed part of the remand order as well as any district court ruling made after the

remand." Sept. l4, 2011 Mandate of United States Court of Appeals [Civ. No. 06~1926, ECF No. 59; Civ. No. 06~

1927, ECF No. 31]. Apparently, plaintiffs would read the D.C. Circuit’s order as providing that following remand

proceedings, plaintiffs may "appeal [to the district court] any still-disputed part of the remand order as well as any

district court ruling made after the remand." See Pls.’ Reply at 2. This Court declines to adopt such an illogical

reading of the D.C. Circuit’s order, which would require not only ignoring the context in which the order was issued,

but also assuming that the D.C. Circuit disregarded or overlooked the law of the case doctrine.

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Accordingly, plaintiffs’ Motion for Leave to Conduct Discovery and to Supplement the

Administrative Record [ECF No. 17] is DENIED, and the parties shall jointly file a proposed

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briefing schedule for dispositive motions by May ¢?7, 2016.

SO ORDERED.

May/¢Z%lo

THoMAs F. HoGA

SENIoR UN!TED STAT '