Santa Rosa Memorial Hospital et al v. Shewry

Filing 149

ORDER DISMISSING COMPLAINT AND ALL RELATED CLAIMS. Signed by Judge Samuel Conti on July 20, 2015. Parties are ORDERED to jointly file within 30 days if any matter still requires the attention of the Court. (sclc2, COURT STAFF) (Filed on 7/20/2015)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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United States District Court

For the Northern District of California

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) Case No. 08-CV-5173 SC
)
SANTA ROSA MEMORIAL HOSPITAL, et ) ORDER DISMISSING COMPLAINT AND
al.,
) ALL RELATED CLAIMS
)
Plaintiffs,
)
)
v.
)
)
DAVID MAXWELL-JOLLY, Director of )
the California Department of
)
Health Care Services,
)
)
Defendant.
)
)
)

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The Court now turns to a request by Plaintiffs for dismissal

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pursuant to Fed. R. Civ. P. 12(b)(6), Fed. R. Civ. P. 41(a)(2), and

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pending motions for summary judgment.

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Any hearing associated with the complaint, motion for voluntary

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dismissal, or cross-motion for summary judgment is hereby VACATED,

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as the Court finds the matters are appropriate for resolution

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without oral argument under Civil Local Rule 7-1(b).

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ECF Nos. 127, 129, 147, 148.

The Court has heard from Plaintiffs who agree with the Ninth

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Circuit that their Section 30(A) claim should be dismissed in light

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of a recent decision, and also request "that the Court dismiss the

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other pending claims" pursuant to Fed. R. Civ. P. 41(a)(2).

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request is reminiscent of the one the Court reviewed and denied in

This

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its order dated May 30, 2014, ECF No. 124.

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order, the merits were not before the Court and there was no clear

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guidance on whether the Supremacy Clause permitted the substantive

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action Plaintiffs sought to bring.

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Ninth Circuit instructed the Court not to hear Plaintiffs' claims,

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Plaintiffs' contention that it was not simply trying to avoid the

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federal courts would be colorable.

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and in that former posture that the Court made its earlier

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decision.

United States District Court

For the Northern District of California

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At the time of that

The Court reasoned that had the

It was absent such direction

Now, upon review of the Ninth Circuit's decision in

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Exceptional Child Ctr. v. Armstrong, Case No. 12-35382 (9th Cir.

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June 5, 2015), Dkt. No. 50, a copy of which was provided to the

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Court at ECF No. 147, the law is settled and the Court has a clear

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directive from the Ninth Circuit, who in turn received its

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instructions from the United States Supreme Court.

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implied private right of action or ability for Medicaid providers

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to proceed in equity for enforcement under Section 30(A).

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(explaining Armstrong v. Exceptional Child Ctr., Inc., 135 S. Ct.

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1378 (2015)).

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relating to other -- albeit unlikely -- postures this case might

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take (e.g., an APA case).

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PREJUDICE the Complaint under Fed. R. Civ. P. 12(b)(6) insofar as

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it alleges violations of Section 30(A) of the Medicare Act.

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There is no

See id.

The Court is cognizant, however, of speculation

Accordingly, the Court DISMISSES WITHOUT

Insofar as any claim might be deemed to remain with the Court,

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the Court has been asked by Plaintiffs to voluntarily dismiss

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pursuant to Fed. R. Civ. P. 41(a)(2).

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"the district court's sound discretion and the court's order will

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not be disturbed unless the court has abused its discretion."

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Such a motion is left to

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Westlands Water Dist. v. United States, 100 F.3d 94, 96 (9th Cir.

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1996) (internal citations omitted).

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consider whether "the defendant will suffer some plain legal

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prejudice as a result of the dismissal."

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v. Baker, 24 F.3d 1162, 1169 (9th Cir. 1994); Hamilton v. Firestone

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Tire & Rubber Co., 679 F.2d 143, 145 (9th Cir. 1982)).

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such prejudice include loss of a federal forum, the right to a jury

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trial, a statute-of-limitations defense, precluding rights and

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defenses available to a defendant in future litigation, or

However, the Court must

Id. (citing Hyde & Drath

Examples of

United States District Court

For the Northern District of California

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rendering parties unable to conduct sufficient discovery to

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untangle complex fraud claims and adequately defend themselves

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against charges of fraud.

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of the Court to consider whether attorneys' fees should be granted

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is reversible error, but awarding the fees is not mandatory so long

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as the Court duly considered the issue.

Westlands, 100 F. 3d at 97-98.

Failure

Id. at 98.

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Defendant argues that dismissal without prejudice would

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deprive the Defendant of a federal forum and favorable judgment on

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the merits.

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that they are highly likely in the federal forum to obtain judgment

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against the Plaintiffs.

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rejected claims by Defendants that they would be harmed where the

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case had barely progressed beyond the complaint, answer, and cross-

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motions, and also where Defendants failed to explain how their case

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would suffer as a result of Plaintiffs' case being voluntarily

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dismissed.

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0681, 2006 U.S. Dist. LEXIS 58914, *5-*6.

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involved a complaint, answer, injunctions, and appeals which caused

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cross-motions for summary judgment to be stayed.

In support, Defendant cites Westlands and their belief

ECF No. 145 at 7-8.

In McCovey, the Court

See McCovey v. Astrazeneca Pharms., L.P., No. C-06-

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Here, the case has

While this has

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taken a long time, the Court is satisfied that the case is closer

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to having "barely progressed" than being fully prepared for trial.

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Moreover, Defendant fails to cite any argument which would be

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foreclosed in our sister courts in the State of California should

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the federal case be dismissed without prejudice.1

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statements and predictions are not sufficient for the Court to

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overcome Plaintiffs' concerns over creating piecemeal litigation,

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unnecessary duplication of efforts, potentially inconsistent

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results, and unnecessary trouble and expense to litigants.

Conclusory

United States District Court

For the Northern District of California

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Therefore, the Court finds the loss of a federal forum will not

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unduly harm the Defendant.
The Court agrees it seems unfair the Defendant has been forced

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to litigate for over six years in a federal forum which Plaintiffs

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now voluntarily eschew.

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some appropriate portion of litigation costs and associated

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attorneys' fees be awarded to Defendant.

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meritorious enough to be heard by the Supreme Court, and no

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provision by the statute or contractual provision entitles the

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Defendant to fees.

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Rule," Fleischmann Distilling Corp. v. Maier Brewing Co., 87 S. Ct.

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1404, 1406-1407 (1967), and discretion of the Court, Westlands, 100

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F. 3d at 98, each side shall bear its own costs and fees.

Even so, the Court does not order that

Plaintiffs' case was

Therefore, both by operation of the "American

Accordingly, the Court DISMISSES WITHOUT PREJUDICE all

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remaining claims before the Court pursuant to Fed. R. Civ. P.

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41(a)(2).

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moot.

All pending motions for summary judgment are DENIED as

The parties are ORDERED to file a joint statement within 30

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Insofar as the Defendant argues the Court retains jurisdiction,
the Court is inclined to agree but does not reach the issue.

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days of the issuance of this order if any matter still requires the

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attention of this Court.

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IT IS SO ORDERED.

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Dated: July 20, 2015
UNITED STATES DISTRICT JUDGE

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United States District Court

For the Northern District of California

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