Providence Pediatric Medical D v. Poonam Alaigh , 672 F. App'x 172 ( 2016 )

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
______________
No. 16-1883
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PROVIDENCE PEDIATRIC MEDICAL DAYCARE INC;
G.V., on behalf of her minor child,
M.N.; T. P., on behalf of her minor child J.M.; A. B., on behalf of her
minor child T.B.; D. L., on behalf of her minor child J.B.; H. S.,
on behalf of her minor child C.T.
v.
POONAM ALAIGH, Individually and as Commissioner of the New
Jersey Department of Health and Senior Services;
NEW JERSEY DEPARTMENT OF HEALTH AND SENIOR SERVICES;
JENNIFER VELEZ, Esq., Individually and as Commissioner of the
Department of Human Services; NEW JERSEY DEPARTMENT OF HUMAN
SERVICES;
JOHN GUHL, Individually and as Director of the Division of Medical
Assistance and Health Services; DIVISION OF MEDICAL ASSISTANCE AND
HEALTH SERVICES
Providence Pediatric Medical Day Care Inc,
Appellant
(D.C. No. 1-10-cv-02799)
District Judge: Hon. Noel L. Hillman
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Submitted under Third Circuit L.A.R. 34.1(a)
November 17, 2016
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Before: AMBRO, SHWARTZ, and FUENTES, Circuit Judges.
(Filed: December 6, 2016)
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OPINION*
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SHWARTZ, Circuit Judge.
Providence Pediatric Medical DayCare, Inc., appeals the District Court’s order
granting summary judgment in favor of Poonam Alaigh and others (“Defendants”) and
denying Providence’s cross-motion for attorneys’ fees and costs. For the reasons set
forth herein, we will affirm.
I
Providence, a New Jersey corporation, operates several pediatric medical daycare
(“PMDC”) facilities. PMDC facilities “provide[ ] medically necessary services to
technology-dependent children or children with complex medical needs in an ambulatory
care setting.” App. 165, 549. An entity wishing to open, expand, or relocate a PMDC
facility in New Jersey must obtain a license from the New Jersey Department of Health
(“DOH”). The licensing process requires such an entity to submit a project proposal,
application, and fee to DOH.
On September 22, 2003, Providence submitted an application to DOH to expand
the capacity of its Camden, New Jersey facility from 30 to 114 children, or “slots,” per
day. To do so, Providence sought to use both the first and second floors of the building
in which it had been operating. DOH returned the application because state regulations
allowed a maximum of only 27 slots per facility.
*
This disposition is not an opinion of the full Court and, pursuant to I.O.P. 5.7,
does not constitute binding precedent.
2
On November 3, 2003, DOH imposed a moratorium on applications for new or
expanded PMDC facilities. Providence submitted two applications after the moratorium
began: it re-submitted its earlier application to expand its Camden facility, and it
submitted an application to obtain a license for a new facility in Berlin, New Jersey.1
DOH rejected both applications because they were submitted after the moratorium came
into effect. During the moratorium, however, Providence was permitted to transfer the
license for its existing facility in Lawnside, New Jersey to the first floor of its Camden
building. Providence thus obtained a license for its expanded Camden facility on
September 6, 2005.
The moratorium was lifted on November 1, 2012, and Providence thereafter
applied for a license for its Berlin location, which DOH granted on December 5, 2014.
Providence filed a Complaint on June 1, 2010, asserting, among other claims, that
it was denied equal protection on the grounds that Defendants selectively and arbitrarily
enforced the 27-slot limitation and the moratorium.2 Providence sought damages as well
as injunctive and declaratory relief.
1
Providence notes that it submitted its initial application for the expanded Camden
facility and at least began the application process for the Berlin facility prior to the
moratorium. The cover letters for its Berlin and (re-submitted) Camden applications
were dated November 2, 2003, but the overnight mail envelope was dated November 13,
2003, and the check accompanying the applications was dated November 14, 2003.
2
Providence also asserted that Defendants: (1) failed to comply with federal
Medicaid laws, (2) denied it and children in its care equal treatment and comparable care
as required by Title XIX, (3) failed to administer the Medicaid program efficiently and
effectively, and (4) violated due process based on the allegedly selective and arbitrary
enforcement of the 27-slot limit and the moratorium, as well as the promulgation of new
clinical eligibility standards.
3
Following discovery, Defendants moved for summary judgment, which the
District Court granted on all but Providence’s equal protection claim for prospective
injunctive and declaratory relief against the individual defendants in their official
capacities.
Defendants filed a second motion for summary judgment on the equal protection
claim, and Providence cross-moved for, among other things, attorneys’ fees and costs.3
The District Court granted summary judgment on the equal protection claim on the
ground that it was moot because Providence had already obtained the two licenses it
sought and it made no allegations about its ability to obtain licenses in the future or show
that another moratorium would be imposed. The District Court denied Providence’s
cross-motion for fees, finding it was not a “prevailing party” under 42 U.S.C. § 1988(b)
because the issuance of the licenses was not the result of judicial action. Providence
appeals.
II4
3
Providence also cross-moved to reopen discovery, which was denied. This
ruling was not appealed.
4
The District Court had jurisdiction pursuant to 28 U.S.C. § 1331. We have
jurisdiction pursuant to 28 U.S.C. § 1291. Our review of the District Court’s grant or
denial of summary judgment is plenary. Mylan Inc. v. SmithKline Beecham Corp., 723
F.3d 413, 418 (3d Cir. 2013). We apply the same standard as the District Court, viewing
facts and making all reasonable inferences in the non-movant’s favor. Hugh v. Butler
Cty. Family YMCA, 418 F.3d 265, 266-67 (3d Cir. 2005). Summary judgment is
appropriate where “there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). “An issue is genuine only
if there is a sufficient evidentiary basis on which a reasonable jury could find for the non-
moving party, and a factual dispute is material only if it might affect the outcome of the
suit under governing law.” Kaucher v. Cty. of Bucks, 455 F.3d 418, 423 (3d Cir. 2006)
(citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). The moving party is
4
A
We first consider whether the District Court properly granted summary judgment
on Providence’s request for injunctive relief on its equal protection claim because it is
moot.
Under Article III, a federal court may “exercise . . . judicial power” only over
cases or controversies. Rendell v. Rumsfeld, 484 F.3d 236, 240 (3d Cir. 2007) (quoting
Int’l Bhd. of Boilermakers v. Kelly, 815 F.2d 912, 914 (3d Cir. 1987)). The existence of
a case or controversy requires “‘(1) a legal controversy that is real and not hypothetical,
(2) a legal controversy that affects an individual in a concrete manner so as to provide the
factual predicate for reasoned adjudication, and (3) a legal controversy with sufficiently
adverse parties so as to sharpen the issues for judicial resolution.’” Id. (quoting Int’l Bhd.
of Boilermakers, 815 F.2d at 915). Put simply, a case or controversy arises when one
party asserts that another party has violated its rights.
“A case may become moot if (1) the alleged violation has ceased, and there is no
reasonable expectation that it will recur, and (2) interim relief or events have completely
and irrevocably eradicated the effects of the alleged violations.” N.J. Tpk. Auth. v.
Jersey Cent. Power & Light, 772 F.2d 25, 31 (3d Cir. 1985) (quoting Finberg v. Sullivan,
658 F.2d 93, 97-98 (3d Cir. 1980)); see also Friends of the Earth, Inc. v. Laidlaw Envtl.
Servs. (TOC), Inc., 528 U.S. 167, 189 (2000) (“‘A case might become moot if subsequent
events made it absolutely clear that the allegedly wrongful behavior could not reasonably
entitled to judgment as a matter of law when the non-moving party fails to make “a
sufficient showing on an essential element of her case with respect to which she has the
burden of proof.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).
5
be expected to recur.’” (quoting United States v. Concentrated Phosphate Export Ass’n,
393 U.S. 199, 203 (1968))).5
Providence contends that Defendants violated its equal protection rights in
connection with licenses it sought to operate facilities in Camden and Berlin. Events
after Providence’s 2003 applications, however, eradicated any effects of Defendants’
alleged equal protection violation. In 2005, Providence was permitted to expand its
Camden facility by transferring a license from another facility. In 2014, Providence
applied for and was granted a license to open a facility in Berlin. In short, Providence
has already “received the very relief [it] sought” and the effects of Defendants’ actions
have been eradicated. Gayle v. Warden Monmouth Cty. Corr. Inst., --- F.3d ---, 2016
WL 5219877, at *5 (3d Cir. Sept. 22, 2016) (dismissing for mootness and noting that the
appellants’ individual claims had been moot for nearly three years). Furthermore, there is
no reasonable expectation of recurrence. The moratorium has been lifted, no moratoria
have since been implemented on PMDC facilities, and there is no evidence that any will
be imposed in the future. See Hudson v. Robinson, 678 F.2d 462, 465 (3d Cir. 1982) (“If
a defendant has discontinued challenged activities (as this defendant has), the case is
moot if there is no reasonable expectation that the wrong will be repeated.”). Thus, the
District Court properly found that Providence’s request for injunctive relief based on its
equal protection claim is moot.
5
A defendant’s “[m]ere voluntary cessation of allegedly illegal conduct does not
moot a case.” Concentrated Phosphate Export Ass’n, 393 U.S. at 203 (citing United
States v. W. T. Grant Co., 345 U.S. 629, 632 (1953)).
6
B
The District Court properly denied Providence’s cross-motion for attorneys’ fees
and costs because Providence is not a “prevailing party” under § 1988.6 To be a
prevailing party under § 1988, the plaintiff must “‘at a minimum, . . . be able to point to a
resolution of the dispute which changes the legal relationship between itself and the
defendant.’” Singer Mgmt. Consultants, Inc. v. Milgram, 650 F.3d 223, 228 (3d Cir.
2011) (en banc) (quoting Tex. State Teachers Ass’n v. Garland Indep. Sch. Dist., 489
U.S. 782, 792 (1989)). That change “must be the product of judicial action.” Id. As the
Supreme Court has explained, “[a] defendant’s voluntary change in conduct, although
perhaps accomplishing what the plaintiff sought to achieve by the lawsuit, lacks the
necessary judicial imprimatur on the change.” Buckhannon Bd. & Care Home, Inc. v. W.
Va. Dep’t of Health & Human Res., 532 U.S. 598, 605 (2001) (rejecting the “catalyst
theory” as a basis for fees and costs) (emphasis omitted); see also Singer Mgmt.
Consultants, 650 F.3d at 228 (“[A] plaintiff does not become a ‘prevailing party’ solely
because his lawsuit causes a voluntary change in the defendant’s conduct.”) (citation and
internal quotation marks omitted).
Here, Providence is not a “prevailing party” because the changes in the parties’
legal relationship are not the result of any “judicial action.” The moratorium expired and
Providence obtained the licenses it had sought since 2003, but not through judicial action.
See Singer Mgmt. Consultants, 650 F.3d at 229-32 (holding that plaintiff was not a
6
We exercise plenary review over the question of whether a plaintiff is a
“prevailing party.” Truesdell v. Phila. Hous. Auth., 290 F.3d 159, 163 (3d Cir. 2002).
7
prevailing party under § 1988 where the district court had entered a TRO and defendant
then voluntarily changed its position, thereby “moot[ing] the case at the preliminary
injunction hearing”). Because the change in the legal relationship among the parties was
not the product of any judicial action, the District Court correctly denied Providence’s
request for fees and costs.7
III
For the foregoing reasons, we will affirm.
7
To the extent Providence asserts it is a “prevailing party” because its equal
protection claim survived the first motion for summary judgment, this argument fails. A
denial of summary judgment is not a ruling on the merits and does not operate to change
the parties’ legal relationship. See Dessar v. Bank of Am. Nat’l Tr. & Sav. Ass’n, 353
F.2d 468, 470 (9th Cir. 1965) (“[A] denial [of a motion for summary judgment] merely
postpones decision of any question; it decides none. To give it any other effect would be
entirely contrary to the purpose of the summary judgment procedure.”).
8