Bayou Shores SNF, LLC v. Burwell et al

Filing 44

ORDER: Plaintiff Bayou Shores SNF, LLC's Emergency Motion for an Injunction Pending Appeal 38 is DENIED. Signed by Judge Virginia M. Hernandez Covington on 8/20/2014. (KNC)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
BAYOU SHORES SNF, LLC,
Plaintiff,
v.

Case No. 8:14-cv-1849-T-33MAP

SYLVIA MATHEWS BURWELL,
Secretary of the United States
Department of Health and Human
Services, ET AL.,
Defendants.
_______________________________/
ORDER
This matter comes before the Court pursuant to Plaintiff
Bayou Shores SNF, LLC’s Emergency Motion for an Injunction
Pending Appeal (Doc. # 38), filed on August 15, 2014. On
August 18, 2014, this Court truncated the time in which
Defendants Sylvia Mathews Burwell, in her official capacity
as Secretary of the United States Department of Health and
Human Services; Marilyn Tavenner, in her official capacity as
Administrator

of

the

Centers

for

Medicare

and

Medicaid

Services; and Elizabeth Dudek, in her official capacity as
Secretary of the Florida Agency for Healthcare Administration
had to file a response in opposition to the Motion. (Doc. #
39). As a result, Defendants had until August 20, 2014, to
file a response. (Id.).

Defendants filed responses in opposition to the Motion
on August 19, 2014 (Doc. # 42), and August 20, 2014 (Doc. #
43).

For

the

reasons

stated

below,

this

Court

denies

Plaintiff’s Motion.
I.

Background
Plaintiff is the operator of a skilled nursing facility

known as Rehabilitation Center of St. Pete (St. Pete Rehab).
(Doc. # 1 at 1). St. Pete Rehab participates in the Medicare
and Medicaid programs pursuant to a provider agreement with
the United States Department of Health and Human Services’
Centers

for

Medicare

and

Medicaid

Services

(CMS)

and

applicable federal statutes and regulations. (Id. at ¶ 9).
On July 11, 2014, CMS’ Florida survey agency – Agency
for

Healthcare

Administration

(AHCA)

-

concluded

a

Recertification and Complaint survey at St. Pete Rehab. (Id.
at ¶ 50). Upon completion of the survey, the surveyors
indicated that they intended to cite deficiencies related to
findings of immediate jeopardy.1 (Id.; Ex. E). The basis of

1

Immediate jeopardy is defined as, “a situation in which
the provider's noncompliance with one or more requirements of
participation has caused, or is likely to cause, serious
injury, harm, impairment, or death to a resident.” See 42
C.F.R. § 488.301.

2

the immediate jeopardy concerned three residents in St. Pete
Rehab’s secured unit. (Id. at ¶ 51; Ex. E).
By letter dated July 14, 2014, AHCA notified St. Pete
Rehab

that

“it

was

not

in

compliance

with

Federal

participation requirements for nursing homes participating in
the

Medicare/Medicaid

programs,

and

alleged

that

the

conditions in the facility constituted immediate jeopardy to
resident health and safety.” (Id. at ¶ 52; Ex. F). AHCA
further informed St. Pete Rehab that it was recommending to
CMS that St. Pete Rehab’s provider agreement be terminated
effective August 3, 2014. (Id. at ¶ 53; Ex. F). The letter
also instructed St. Pete Rehab that, in the event that the
immediate jeopardy was removed, St. Pete Rehab was to inform
AHCA as to the corrective measures taken. (Id.).
St. Pete Rehab submitted its Allegation of Compliance
(AOC) on July 17, 2014, detailing the steps taken to remove
the immediate jeopardy and alleging that it was in substantial
compliance with the requirements of the Medicare and Medicaid
programs as of July 18, 2014. (Id. at ¶ 54; Ex. G). On July
28, 2014, St. Pete Rehab submitted an amended AOC illustrating
further corrective measures St. Pete Rehab had undergone in
connection with the deficiencies identified in the survey.

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(Id. at ¶ 55; Ex. H). These additional measures were in place
as of July 28, 2014. (Id.).
In addition to the “significant corrective measures
implemented as described in [St. Pete Rehab’s] AOCs,” St.
Pete Rehab retained an “independent third-party consulting
organization to analyze and assess the sufficiency of the
corrective measures taken in connection with the deficiencies
identified in the [s]urvey.” (Id. at ¶ 56; Ex. I). Beginning
on July 28, 2014, consultants conducted an assessment of the
corrective measures, suggested further improvements to St.
Pete Rehab’s practices and procedures, and performed audits
and reviews involving “elopement; elopement training and risk
assessment; [and] policy and procedure revisions and review.”
(Id. at ¶ 57).
At the conclusion of the assessment, the consultants
determined

that,

based

upon

their

review,

including

the

interventions in place at St. Pete Rehab on July 29 and 30,
2014, St. Pete Rehab was in compliance with the deficiencies
identified by the AHCA survey team during the June of 2014,
inspection. (Id. at ¶ 60). Once the corrective measures were
implemented, representatives of St. Pete Rehab made several
requests to AHCA and CMS to conduct a revisit and confirm

4

that St. Pete Rehab was in substantial compliance with program
requirements. (Id. at ¶ 59).
On July 22, 2014, CMS notified St. Pete Rehab that it
was “not in substantial compliance with the participation
requirements, and that conditions in [St. Pete Rehab] also
constituted

immediate

jeopardy

to

residents’

health

and

safety and substandard quality of care that was determined to
exist on June 21, 2014, and is considered ongoing.” (Id. at
¶ 60; Ex. K).

Based on the findings of AHCA, CMS imposed the

following sanctions upon St. Pete Rehab: (1) involuntary
termination of St. Pete Rehab’s provider agreement effective
August 3, 2014; (2) discretionary denial of payment for new
admissions effective July 24, 2014; and (3) a civil money
penalty of $3,050 per day effective June 21, 2014. (Id.).
“St. Pete Rehab has appealed to CMS the determination
that it was not in substantial compliance with the alleged
deficiencies underlying the termination decision prior to the
effective date of the termination.” (Id. at ¶ 61, Ex. L). “As
a part of this effort, St. Pete Rehab has requested an
expedited hearing before an administrative law judge.” (Id.;
Ex. M).
Plaintiff
seeking

initiated

injunctive

this

relief;

action

on

August

specifically,

5

a

1,

2014,

temporary

restraining order, a preliminary injunction, and a permanent
injunction to prevent Defendants’ threatened termination of
St. Pete Rehab’s Medicare and Medicaid provider agreement on
August 3, 2014. (See Doc. # 1). According to Plaintiff, St.
Pete

Rehab

is

entitled

to

(1)

a

revisit

survey

and

a

determination of whether St. Pete Rehab is in substantial
compliance with applicable Medicare regulations underlying
the

termination

decision

and

(2)

a

final

administrative

hearing on the merits for such a determination prior to the
drastic remedy of termination of its provider agreement. (Id.
at 2).
Also on August 1, 2014, Plaintiff filed a Motion for
Emergency

Ex

Parte

Temporary

Restraining

Order

and

Preliminary Injunctive Relief. (Doc. # 2). Upon review of the
Motion, this Court entered an Order issuing a temporary
restraining order for 14 days – until August 15, 2014 - for
the

purpose

of

preserving

the

status

quo.

(Doc.

#

9).

Thereafter, on August 11, 2014, Defendants filed a Motion to
Dismiss

and

Opposed

Motion

to

Dissolve

the

Temporary

Restraining Order contending that dismissal of this action is
warranted as this Court lacks subject matter jurisdiction.
(Doc. # 22). Upon review of the Motions and the response
thereto, the Court granted Defendants’ Motions, dissolved the

6

temporary restraining order, denied Plaintiff’s Motion to
Extend the Temporary Restraining Order (Doc. # 32), and
dismissed this case for lack of subject matter jurisdiction.
(See Doc. # 35).
Plaintiff filed the present Motion on August 15, 2014,
requesting that this Court enter an injunction precluding
Defendants

from

(1)

withholding

Medicare

and

Medicaid

payments from St. Pete Rehab for care provided to Medicare
and Medicaid residents during the pendency of St. Pete Rehab’s
appeal

to

the

Eleventh

Circuit

and

(2)

involuntarily

relocating the Medicare and Medicaid residents of St. Pete
Rehab during the pendency of that appeal. (See Doc. # 38).
Defendants filed responses in opposition to the Motion on
August 19, 2014 (Doc. # 42), and August 20, 2014 (Doc. # 43).
This Court has reviewed the Motion and the responses and is
otherwise fully advised in the premises.
II.

Discussion
“As a general rule, ‘[t]he filing of a notice of appeal

. . . divests the district court of control over those aspects
of the case involved in the appeal.’” Pacific Ins. Co. v.
Gen. Dev. Corp., 28 F.3d 1093, 1097 n. 7 (11th Cir. 1994)
(quoting Griggs v. Provident Consumer Disc. Co., 459 U.S. 56,
58 (1982)). However, a trial court has the power to enter

7

orders necessary to preserve the status quo while a case is
pending on appeal. Lawson v. Life of S. Ins. Co., 738 F. Supp.
2d 1376, 1379 (M.D. Ga. 2010); Peak Med. Okla. No. 5, Inc. v.
Sebelius, No. 10-CV-597-TCK-PJC, 2010 WL 4809319, at *2 (N.D.
Okla. Nov. 18, 2010)(“A trial court has a long-established
right to make orders appropriate to preserve the status quo
while a case is pending on appeal); Newton v. Consol. Gas Co.
of N.Y., 258 U.S. 165, 177 (1922) (“Undoubtedly, after appeal
the trial court may, if the purposes of [j]ustice require,
preserve the status quo until decision by the appellate
court.”).
This Court notes that granting a motion for injunctive
relief pending appeal is an “extraordinary remedy.” Touchston
v. McDermott, 234 F.3d 1130, 1132 (11th Cir. 2000). “When
considering such a motion, the court is guided by . . .
jurisprudence under Fed. R. App. P. 8(a) and assesses the
movant's chances for success on appeal and weighs the equities
as they affect the parties and the public.” Alaska Cent.
Express, Inc. v. United States, 51 Fed. Cl. 227, 229 (Fed.
Cl. 2001)(quoting Hilton v. Braunskill, 481 U.S. 770, 776
(1987)).
Fed. R. Civ. P. 62(c) “permit[s] a district court, in
its discretion, to suspend, modify, restore or grant an

8

injunction during the pendency of the appeal.” Wyatt By &
Through Rawlins v. Poundstone, 941 F. Supp. 1100, 1107 (M.D.
Ala. 1996)(emphasis added). Pursuant to Fed. R. Civ. P. 62(c),
“[w]hile an appeal is pending from an interlocutory order or
final

judgment

that

grants,

dissolves,

or

denies

an

injunction, the court may suspend, modify, restore, or grant
an injunction on terms for bond or other terms that secure
the opposing party's rights.” Fed. R. Civ. P. 62(c)(emphasis
added).
In determining whether to issue an injunction pending
appeal pursuant to Fed. R. Civ. P. 62(c), a court should
consider the following factors: (1) whether the movant is
likely to succeed on the merits of its appeal; (2) whether
the movant will be irreparably injured absent an injunction;
(3) whether issuance of the injunction will substantially
injure the other parties interested in the proceeding; and
(4) where the public interest lies. Wyatt By & Through
Rawlins, 941 F. Supp. at 1108 (citing Hilton, 481 U.S. at
776).
Plaintiff contends that its appeal of this Court’s Order
granting Defendants’ Motion to Dismiss and dissolving the
temporary restraining order (Doc. # 35) “presents several
important legal questions of first impression, some of which

9

have never been addressed by any court prior to this Court’s
decision and some of which have resulted in conflicting
rulings.” (Doc. # 37 at 2; Doc. # 38 at 1-2). “At the moment,
the answers to those legal questions affect the lives of over
120 Medicare and Medicaid residents of St. Pete Rehab, most
of whom are physically and/or psychologically fragile; 175
employees and their families, who depend on St. Pete Rehab
for their livelihoods; and one local community that can ill
afford the loss of additional jobs.” (Id.).
Therefore, Plaintiff requests that this Court enter an
injunction

precluding

Defendants

from

(1)

withholding

Medicare and Medicaid payments from St. Pete Rehab for care
provided

to

Medicare

and

Medicaid

residents

during

the

pendency of St. Pete Rehab’s appeal to the Eleventh Circuit
and (2) involuntarily relocating the Medicare and Medicaid
residents of St. Pete Rehab during the pendency of that
appeal. (See Doc. ## 37, 38)(citing Peak Med. Okla. No. 5,
Inc., 2010 WL 4809319, at *2 (granting injunctive relief
pending appeal of court’s order that dismissed action for
lack of subject matter jurisdiction)).
It is well settled that a district court may issue
injunctive relief while an appeal is pending regarding the
determination

of

its

jurisdiction

10

over

the

underlying

dispute. Nat'l Athletic Trainers' Ass'n, Inc. v. U.S. Dep't
of Health & Human Servs., No. CIV.A.3:05CV1098-G, 2005 WL
1923566, at *2 (N.D. Tex. Aug. 11, 2005) aff'd, 455 F.3d 500
(5th Cir. 2006); Stewart v. Dunn, 363 F.2d 591, 598 (5th Cir.
1966)(“The law is clear that pending a decision on the
question of jurisdiction, a [d]istrict [c]ourt has the power
to issue a temporary restraining order in order to preserve
existing conditions.”). However, “a court lacks the authority
to provide injunctive relief once it has determined that it
lacks jurisdiction over the underlying case.” Nat'l Athletic
Trainers' Ass'n, Inc., 2005 WL 1923566, at *2 (finding that
the

court

“lack[ed]

the

authority

to

provide

injunctive

relief once it [had] determined that it lack[ed] jurisdiction
over the underlying case.”); McCammon v. United States, 584
F. Supp. 2d 193, 196 (D.D.C. 2008) (questioning whether court
had jurisdiction to provide injunctive relief to movant after
previously

determining

it

lacked

subject

matter

jurisdiction); Univ. of S. Alabama v. Am. Tobacco Co., 168
F.3d 405, 410 (11th Cir. 1999)(“Simply put, once a federal
court

determines

that

it

is

without

subject

matter

jurisdiction, the court is powerless to continue.”).
In its previous Order, this Court determined that it
lacked

subject

matter

jurisdiction

11

over

this

case

as

Plaintiff admittedly failed to exhaust all of the available
administrative remedies:
[T]he Court concludes that 42 U.S.C. 405(g), with
its
administrative
exhaustion
requirement,
provides the sole avenue for judicial review of the
Secretary’s termination determination. Plaintiff
has not provided this Court with sufficient support
– factual or otherwise – to demonstrate its
entitlement to a waiver of the exhaustion
requirement. As Plaintiff admittedly has not
exhausted all of the available administrative
remedies, this Court finds that it lacks subject
matter jurisdiction over this action.
(See Doc. # 35). Therefore, the Court dissolved the temporary
restraining order in place at the time and declined to engage
in an analysis as to whether additional injunctive relief was
appropriate under the present circumstances.
As articulated by Defendants, “Plaintiff now moves this
Court to do the very act the Court just found it lacked
jurisdiction to do: enjoin the United States from terminating
Plaintiff’s provider agreement.” (Doc. # 42 at 4). This Court
declines to do so. As this Court previously found that it
lacks subject matter jurisdiction over this action, the Court
finds that it lacks the authority to issue the requested
injunctive relief during the pendency of Plaintiff’s appeal.
In

making

its

determination,

the

Court

notes

that

Plaintiff’s ability to seek the requested relief is not
foreclosed by this Court’s decision. Pursuant to Fed. R. App.

12

P. 8(a), Plaintiff may seek the requested relief from the
Eleventh Circuit pending its appeal:
(a) Motion for Stay.
(1) Initial Motion in the District Court. A
party must ordinarily move first in the
district court for the following relief:
* * *
(C) an order suspending,
restoring, or granting an
while an appeal is pending.

modifying,
injunction

(2) Motion in the Court of Appeals; Conditions
on Relief. A motion for the relief mentioned
in Rule 8(a)(1) may be made to the court of
appeals or to one of its judges.
See Fed. R. App. P. 8 (emphasis added).
Accordingly, it is now
ORDERED, ADJUDGED, and DECREED:
Plaintiff Bayou Shores SNF, LLC’s Emergency Motion for
an Injunction Pending Appeal (Doc. # 38) is DENIED.
DONE and ORDERED in Chambers in Tampa, Florida, this
20th day of August, 2014.

Copies: All Counsel of Record

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