City & Borough of Juneau v. Center for Medicare & Medicaid Services, Region Ten et al
Order on Motion to Intervene
UNITED STATES DISTRICT COURT
DISTRICT OF ALASKA
CITY and BOROUGH OF JUNEAU,
ALASKA, d/b/a BARTLETT
CENTERS FOR MEDICARE AND
MEDICAID SERVICES, REGION 10;
UNITED STATES DEPARTMENT OF
HEALTH AND HUMAN SERVICES;
UNITED STATES OF AMERICA;
R.J. RUFF, in his official capacity as
REGIONAL ADMINISTRATOR OF
REGION 10 FOR THE CENTERS
FOR MEDICARE AND MEDICAID
KAREN s. O’CONNOR, in her official
capacity as ASSOCIATE REGIONAL
ADMINISTRATOR, DIVISION OF
MEDICAID & CHILDREN’S HEALTH,
REGION 10 FOR THE CENTERS FOR
MEDICARE AND MEDICAID
ORDER FROM CHAMBERS
[Re: Motion to Intervene at Doc. 88]
I. MOTION BEFORE THE COURT
The State of Alaska filed a limited motion to intervene as a defendant at
docket 88. At docket 90, plaintiff filed a response in opposition to the motion, and at
docket 91, the State of Alaska replied. Oral argument was not requested and would not
assist the court.
The State of Alaska participates in the federal Medicaid program and has a state
medical services plan approved by defendants (“CMS”).1 Plaintiff (“Bartlett”) operates a
hospital in Juneau, Alaska. On occasion Bartlett seeks payment from the State for
services rendered to persons covered by Medicaid, including payment for outpatient
hospital services. Calculation of amounts to be paid for outpatient hospital services are
addressed on page 5 of Attachment 4.19B of the Alaska State Plan (“Page 5"). In its
Second Amended Complaint, Bartlett asked the court to declare unlawful and set aside
CMS’ retroactive approval of a new version of Page 5 (“Plan Amendment”) which
ostensibly became effective on January 1, 2001.2 The Plan Amendment set out a
different method for calculating amounts to be paid for outpatient hospital services.
Bartlett asserted that if the Plan Amendment were set aside, it could obtain about
$400,000 in additional payments pursuant to an earlier version of Page 5.3
The State has known about this litigation for years: Its own administrative
proceeding, which was commenced in 2003, was stayed in order to make use of the
outcome of this lawsuit. Although the case at bar was filed on July 22, 2004, the State
was content to let the federal government defend against Bartlett’s claim. The State did
The Medicaid Act, 42 U.S.C. §§ 1396, et seq. provides for the appropriation of funds to
those states which have adopted medical assistance plans that have been approved by the
Secretary of the Department of Health and Human Services. The Secretary has delegated
authority to approve state plans to the several regional Centers for Medicare and Medicaid
Services. Region 10 includes Alaska.
Doc. 39 at p.18.
Id. at p. 8.
not seek to intervene until October 6, 2006, after the court granted summary judgment
to Bartlett.4 That motion was denied as untimely.5
Judgment in favor of Bartlett was entered on November 6, 2006.6 The judgment
has the effect of rendering the Plan Amendment void and allowing Bartlett to pursue the
additional $400,000 reimbursement. CMS filed a timely appeal.7 The State moves
again to intervene, this time for the limited purpose of appealing the November 6
judgment by this court. The State argues that it is entitled to intervene as a matter of
right under Rule 24(a) of the Federal Rules of Civil Procedure, and alternatively that this
court should grant intervention permissively under Rule 24(b) of the Federal Rules of
Civil Procedure.8 Bartlett opposes the motion, arguing that the State’s motion should be
denied because it is untimely under Federal Rule of Civil Procedure 59, new trials;
amendment of judgments.9
A. Intervention As Of Right
Federal Rule of Civil Procedure 24(a)(2) governing intervention as of right
provides as follows:
Upon timely application anyone shall be permitted to intervene in an
action (1) when a statute of the United States confers an
unconditional right to intervene; or (2) when the applicant claims an
interest relating to the property or transaction which is the subject of
the action and the applicant is so situated that the disposition of the
action may as a practical matter impair or impede the applicant’s
The order granting summary judgment is at doc. 63, and the motion to intervene is at
Doc. 90 at 2.
ability to protect that interest, unless the applicant’s interest is
adequately represented by existing parties.10
The party seeking to intervene bears the burden of showing that all the requirements for
intervention have been met.11
The Ninth Circuit has said that intervention as of right is “appropriate” if “(1) The
applicant’s motion is timely; (2) the applicant has asserted an interest relating to the
property or transaction which is the subject of the action; (3) the applicant is so situated
that without intervention the disposition may, as a practical matter, impair or impede its
ability to protect that interest; and (4) the applicant’s interest is not adequately
represented by the existing parties.12 The four factors are discussed below.
Timeliness turns on the weighing of three factors:
(a) the stage of the proceedings at which an applicant seeks to intervene;
(b) the prejudice to other parties; and
(c) the reason for and length of the delay.13
Assessment of these factors shows that the motion to intervene is timely.
a. Stage of Proceedings
The “general rule” is that a post-judgment motion to intervene will be considered
timely if it is filed within the time allowed to file an appeal.14 Bartlett asserts that the
state’s motion should be denied as untimely under Federal Rule of Civil Procedure 59,
governing “New Trials; Amendment of Judgments.” Under Rule 59, a motion for a new
Fed. R. Civ. P. 24(a).
U.S. v. Alisal Water Corp., 370 F.3d 915, 919 (9th Cir. 2004).
United States v. Covington Technologies Co., 967 F.2d 1391, 1394 (9th Cir. 1992).
Covington Technologies, 967 F.2d at 1394 (quoting County of Orange v. Air California,
799 F.2d 535, 537 (9th Cir. 1986)).
Covington Technologies, 967 F.2d at 1394 (quoting Yniguez v. Arizona, 939 F.2d 727,
734 (9th Cir. 1991)).
trial or to alter or amend a judgment must be filed no later than 10 days after entry of
judgment.15 Bartlett argues that the State’s motion is a motion under Rule 59(e),
because it alleges that a fundamental legal error occurred.16 Doubtless the State is
motivated to appeal because it believes a legal error occurred. However, it does not
request this court to reconsider, alter, or amend its judgment. Rather, it moves to
intervene for the limited purpose of appealing this court’s decision. The Ninth Circuit
has stated that the “general rule [is] that a post-judgment motion to intervene is timely if
filed within the time allowed for the filing of an appeal.”17 Rule 59 provides a shorter
period of time than that allowed for an appeal, and so cannot be used here without
running afoul of the appellate court’s decision.
Rule 4 of the Federal Rules of Appellate Procedure, not Rule 59 of the Federal
Rules of Civil Procedure, provides the time period which is relevant. Appellate
Rule 4(a)(1)(B) states that where the “United States or its officer or agency is a party,
the notice of appeal may be filed by any party within 60 days” after the judgment
appealed from is entered. The motion to intervene was filed on December 12, 2006,
well within the 60-day period which commenced with entry of the judgment on
November 6, 2006.
b. Prejudice to Other Parties
The second factor in the timeliness consideration is prejudice to other parties.
Where, as here, an appeal has been taken by an existing defendant, the only risk of
prejudice to Bartlett is the possibility that the State of Alaska might be dilatory and seek
to delay the appeal. The State’s poor track record with respect to timely action in this
court suggests the risk is real. On the other hand, the appellate court will control its own
docket, and this court has no doubt that it will insist on reasonable dispatch from all
parties to the appeal. This court does not consider the possibility that the State may
Fed. R. Civ. P. 59 (b), (e).
Covington Technologies, 967 F.2d at 1394 (9th Cir. 1992) (quoting Yniguez v. Arizona,
939 F.2d 727, 734 (9th Cir. 1991) (internal quotation marks omitted)).
provide an additional perspective for the Ninth Circuit to consider to be prejudice. That
merely allows the appellate court to make a decision informed by such perspective.
c. Reason for and Length of Delay
The State’s motion explains the delay as something arising from a change in
perception: its interest was being adequately protected until this court ruled in favor of
plaintiff. With respect to the effort to intervene in proceedings before this court, that
reason was held to be inadequate. However, the pending motion seeks intervention to
participate in the appellate court. The motion comes at the beginning of the appellate
process, not near the end. Both CMS and the State have filed notices of appeal. A
briefing schedule has probably not yet been set in the Court of Appeals, and if it has
action on the motion now should permit the State to meet it. The request to intervene
on appeal has introduced little or no delay in the only court whose docket matters at this
point. Learning that parties once believed to be adequately protecting an interest have
lost in the trial court is a sufficient reason to ask to intervene in the appellate process.
2. Intervener’s Asserted Interest
The State asserts that it has an interest in the contents of the State Plan in
general and a specific interest in the amendment which this court invalidated. The
interest in the amendment is the State’s obligation to reimburse those providing
Outpatient Hospital Services. That interest with respect to Bartlett is very specific and
concrete. If this court’s decision is correct, the State may have to pay Bartlett an
additional $400,000. The State’s interest is sufficient to meet the second prong of the
test articulated by the Ninth Circuit.
3. Impact of Disposition
The third consideration is whether the would-be intervener is in a position such
that further proceedings may impair or impede its rights to protect its legal interests if it
is denied a chance to intervene. Here, the circumstances show that the State’s interest
will be determined in the Court of Appeals. The third factor also favors intervention.
4. Adequacy of Representation
The last question under the Circuit Court’s test is the adequacy of the federal
government’s representation of the State’s interest. Clearly, both governments have an
interest in seeing that the Plan Amendment is upheld. The State’s long acquiescence in
an arrangement in which the federal defendants pulled the oars is evidence that its
interest has been adequately represented by those defendants. On the other hand, the
Supreme Court has stated that this requirement of Rule 24(a) is met, “if the applicant
shows that representation of his interest ‘may be’ inadequate; and the burden of making
that showing should be treated as minimal.”18 This court is also bound to follow the
teachings of the Ninth Circuit, including the admonition that Rule 24(a) should be
interpreted broadly in favor of intervention expressed in Forest Conservation Council v.
U.S. Forest Service.19 There, the Ninth Circuit also explained that adequacy of
representation requires that an existing party “will undoubtedly make all the intervener’s
arguments.”20 Thus, in Forest Conservation Council, it was held that the State of
Arizona and Apache County should have been permitted to intervene in a case arising
under federal environmental statutes despite the fact that the defendant was the United
States Forest Service, which as an agency of the federal government would normally be
presumed to provide adequate representation. The court explained that because the
Forest Service would be focused on the adequacy of the federal decision making
process, the narrower and more parochial interests of the state and county in the
ultimate substantive decision about the management of National Forest lands was not
adequately represented.21 Similarly, here the federal defendants are interested in
upholding the integrity of the decision making process while the State of Alaska is
concerned with the substantive financial impact of the decision to invalidate the Plan
Amendment. The fourth factor also favors intervention.
Trbovich v. United Mine Workers of America, 404 U.S. 533, 538, n. 10 (1972).
66 F.3d 1489, 1493 (9th Cir. 1992).
Id. at 1499.
The requirements of Rule 24(a) have been met. The State of Alaska will be
permitted to intervene as of right. This renders it unnecessary to consider whether the
State is entitled to permissive intervention.
For the reasons above, the motion at docket 88 is GRANTED. The State of
Alaska is permitted to intervene in the appeal from this court’s judgment.
DATE at Anchorage, Alaska, this 21st day of February 2007.
/s/ JOHN W. SEDWICK
UNITED STATES DISTRICT JUDGE
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