GALLARDO v. DUDEK
ORDER GRANTING IN PART AND DENYING IN PART MOTION TO ALTER OR AMEND JUDGMENT - AHCA's Motion to Alter or Amend the Judgment and for Relief from Judgment, ECF No. 44 , is GRANTED in part and DENIED in part. AHCA's moti on is GRANTED to the extent that it seeks an amendment clarifying the injunction's scope. The balance of AHCAs motion is DENIED. The Clerk shall enter a second amended judgment stating: Gianinna Gallardo, an incapacitated person, by and throu gh her parents and co- guardians, Pilar Vassallo and Walter Gallardo, successfully proved that portions of § 409.910(11)(f), Fla. Stat. (2016) and § 409.910(17)(b), Fla. Stat. (2016) are preempted by federal law. It is declared that the f ederal Medicaid Act prohibits the State of Florida Agency for Health Care Administration from seeking reimbursement of past Medicaid payments from portions of a recipients recovery that represents future medical expenses. The State of Florida Agen cy for Health Care Administration is therefore enjoined from doing just that: seeking reimbursement of past Medicaid payments from portions of a recipient's recovery that represents future medical expenses. It is also declared that the federa l Medicaid Act prohibits the State of Florida from requiring a Medicaid recipient to affirmatively disprove § 409.910 (17)(b)'s formula-based allocation with clear and convincing evidence to successfully challenge it where, as here, that allocation is arbitrary and there is no evidence that it is likely to yield reasonable results in the mine run of cases. Signed by JUDGE MARK E WALKER on 7/18/2017. (cle)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF FLORIDA
GIANINNA GALLARDO, AN
INCAPACITATED PERSON, BY
AND THROUGH HER PARENTS
AND CO-GUARDIANS, PILAR
VASSALLO AND WALTER
Case No. 4:16cv116-MW/CAS
JUSTIN M. SENIOR, IN HIS
OFFICIAL CAPACITY AS SECRETARY
OF FLORIDA AGENCY FOR HEALTH
ORDER GRANTING IN PART AND DENYING IN PART
MOTION TO ALTER OR AMEND JUDGMENT
In a cult-classic film, an eccentric inventor transforms a
DeLorean sports car into a sleek time machine. Cf. Back to the
Future (Universal Pictures 1985). Enthralled, the protagonist
travels back in time, where (Great Scott!) he soon realizes that his
actions in the past can nonetheless affect the future.
The Florida Agency for Health Care Administration
(“AHCA”) 1 has also tried to go back in time but, unlike the
protagonist mentioned above, it hopes to change the future (more
specifically, this Court’s prior judgment). AHCA’s vehicle of choice,
though, isn’t a time-traveling DeLorean; it is a Motion to Alter or
Amend the Judgment. In that motion, AHCA makes a number of
arguments—most of which were previously available to it. But this
is not a movie; AHCA has not pointed to a sufficient reason for this
Court to go back in time to allow it to raise those arguments in the
first instance. AHCA also presents a separate standing argument,
which is properly before this Court. But because AHCA is the
agency that administers Medicaid and the only additional steps
necessary to redress Gallardo’s injuries are purely mechanical, its
standing argument is unconvincing on the merits.
AHCA’s motion is therefore GRANTED in part and
DENIED in part. 2
The facts were addressed at length in this Court’s original
For simplicity sake, this Court will refer to AHCA rather than Justin
M. Senior (or Elizabeth Dudek, the original Defendant who has since stepped
down from her position), who has been sued in his official capacity as Secretary
This Court reaches this conclusion with the benefit of a June 15, 2017,
order granting summary judgment. Gallardo v. Dudek, No. 4:16cv-116, 2017 WL 1405166 (N.D. Fla. Apr. 18, 2017). They are
summarized briefly below and supplemented with the more recent
events in this case.
Medicaid is a joint federal–state program whereby the
federal government pays a significant portion of a recipient’s
medical costs and, in return, participating states must comply with
the applicable federal statutes and regulations. Id. at *2. One of
those provisions—the so-called anti-lien provision—states that
“[n]o lien may be imposed against the property of any individual
prior to his death on account of medical assistance paid or to be
paid on his behalf under the State plan, [with exceptions not
relevant here].” 42 U.S.C. § 1396p(a)(1) (2012). But two other
provisions—the third-party liability and assignment provisions—
are narrow exceptions that allow the state to assert liens on
payments for medical care. See Ark. Dep’t of Health & Human
Servs. v. Ahlborn, 547 U.S. 268, 285 (2006) (“[T]he exception
carved out by §§ 1396a(a)(25) and 1396k(a) is limited to payments
for medical care. Beyond that, the anti-lien provision applies.”).
Florida, which participates in the Medicaid program, applies
a one-size fits all statutory formula to determine how much of a
recipient’s recovery constitutes medical expenses and is therefore
available for Medicaid reimbursement. See 409.910(11)(f), Fla.
Stat. (2016). The ultimate result is that AHCA is awarded the
lesser of (1) the amount it actually paid on the Medicaid recipient’s
behalf, or (2) 37.5% of the Medicaid recipient’s total recovery.
Gallardo, 2017 WL 1405166, at *3. The Medicaid recipient,
however, may challenge that formula-based allocation and thus
reduce the amount payable to AHCA by filing a petition with the
Division of Administrative Hearings (“DOAH”) and “‘prov[ing], by
clear and convincing evidence, that a lesser portion of the total
recovery should be allocated as reimbursement for past and future
medical expenses than the amount’ required by the statutory
formula.” Id. (quoting § 409.910(17)(b), Fla. Stat. (2016)).
Gallardo is currently in the midst of that administrative
process. She was struck by a vehicle and suffered severe and
permanent injuries. Gallardo’s medical expenses were covered by
Medicaid and WellCare of Florida, which paid $862,688.77 and
$21,499.30, respectively. Id. Gallardo’s parents filed suit against
those allegedly responsible for her injuries, and AHCA asserted a
lien against that cause of action for the $862,688.77 it expended on
her behalf. Id. Gallardo’s case settled for $800,000. Id. Under
Florida’s formula-based allocation, AHCA was therefore due to be
reimbursed $323,508.29 in medical expenses. Id.
Rather than pay that lien in its entirety, Gallardo contested
it through the state administrative procedure outlined in §
409.910(17)(b). Id. at *4. In those proceedings, Gallardo has argued
that, contrary to federal law, AHCA is attempting to recover its
past Medicaid payments from settlement funds that do not
represent compensation for past medical expenses. Id. AHCA,
however, has argued that it may satisfy its lien from the portion of
Gallardo’s settlement representing compensation for past and
future medical expenses. Id. It has further argued that Gallardo
may successfully challenge that formula-based allocation only if
she can prove by clear and convincing evidence that the amount of
her settlement representing past and future medical expenses is
less than $323,508.29. Id.
Gallardo then sought declaratory and injunctive relief from
this Court, ECF No. 1, and summary judgment was granted in its
favor. More specifically, this Court declared that the federal
Medicaid Act preempted certain portions of § 409.910(17)(b) and
that AHCA therefore could not (1) “seek reimbursement of past
Medicaid payments from portions of a recipient’s recovery that
represents future medical expenses” or (2) “requir[e] a Medicaid
recipient to affirmatively disprove . . . § 409.910(17)(b)’s formulabased allocation with clear and convincing evidence to successfully
challenge it where, as here, that allocation is arbitrary and there
is no evidence that it is likely to yield reasonable results in the
mine run of cases.” Gallardo, 2017 WL 1405166, at *11. AHCA was
therefore enjoined from enforcing § 409.910(17)(b) in its current
Apparently frustrated with this Court’s ruling, AHCA hired
new counsel, see ECF Nos. 42–43 (filing notices of appearance) and
moved to vacate or amend the prior judgment, see ECF No. 44
(filing motion to alter judgment). According to AHCA, this Court
erred in refusing to consider the reimbursement statute’s practical
effect and improperly shifted the burden to AHCA, thus requiring
it—the non-moving party—to present evidence establishing that
the reimbursement statute is not in conflict with (and therefore
preempted by) federal law. Id. at 2–3. AHCA also asserts that this
Court’s prior judgment should be vacated because amendments to
the federal Medicaid Act—which will apparently allow states “to
obtain reimbursement from all or any part of a” Medicaid
recipient’s recovery—are scheduled to take effect on October 1,
2017. Id. at 17. Finally, AHCA submits that it does not enforce
certain preempted portions of the reimbursement statute; thus,
the judgment must be vacated or amended. Id. at 3.
Rules 59 and 60 of the Federal Rules of Civil Procedure are
tools of limited utility. They are not intended to provide
disgruntled litigants with a second bite at the apple. See O’Neal v.
Kennamer, 958 F.2d 1044, 1047 (11th Cir. 1992) (explaining that
attempts under Rule 59 “to obtain a second bite at the apple” are
generally inappropriate); Seamon v. Vaughan, 921 F.2d 1217, 1220
n.6 (11th Cir. 1991) (asserting that “raising . . . new arguments on
a motion to amend . . . affords a litigant two bites at the apple”
(citation omitted)). That is because the extraordinary remedy of
reconsideration is only appropriate in rare circumstances. See
Pensacola Firefighters’ Relief Pension Fund Bd. of Trs. v. Merrill
Lynch Pierce Fenner & Smith, Inc., 265 F.R.D. 589, 591 (N.D. Fla.
2010) (“Reconsideration of a court’s previous order is an
extraordinary remedy and, thus, is a power which should be used
sparingly.” (citations omitted)).
AHCA moves for reconsideration on three separate grounds,
one of which is Rule 59(e). Reconsideration under Rule 59(e) is
available in the limited scenarios “where there is newly-discovered
evidence, an intervening change in the law, or manifest errors of
law or fact.” Fisher v. Carnival Corp., No. 11-22316-CIV, 2013 WL
12061861, at *1 (S.D. Fla. July 29, 2013) (citing Arthur v. King,
500 F.3d 1335, 1343 (11th Cir. 2007))). It is thus improper to use
that vehicle “to relitigate old matters, raise forgotten arguments,
or present evidence that could have been, but was not, raised prior
to the entry of judgment.” Id. (citing Michael Linet, Inc. v. Village
of Wellington, Fla., 408 F.3d 757, 763 (11th Cir. 2005)). Relief
under Rule 59(e) is particularly inappropriate when the moving
“party has failed to articulate any reason for the failure to raise an
issue at an earlier stage in the litigation.” Lussier v. Dugger, 904
F.2d 661, 667 (11th Cir. 1990) (citing Van Ryn v. Korean Air Lines,
640 F. Supp. 284, 286 (C.D. Ca. 1985)).
AHCA also moves for reconsideration under Rule 60(b)(4)
and (5). Rule 60(b)(4) offers relief only when the judgment was
void—that is, rendered without jurisdiction or “in a manner
inconsistent with due process of law.” Burke v. Smith, 252 F.3d
1260, 1263 (11th Cir. 2001) (quoting In re Edwards, 962 F.2d 641,
644 (7th Cir. 1992)). Relief is warranted under Rule 60(b)(5) only
if the moving party can establish “a significant change either in
factual conditions or in law.” Fla. Wildlife Fed’n Inc. v. Admin, U.S.
Envtl. Protective Agency, 620 F. App’x 705, 707 (11th Cir. 2015)
(quoting Sierra Club v. Meiburg, 296 F.3d 1021 (11th Cir. 2002)).
Such relief is rarely granted. See Enax v. Goldsmith, 322 F. App’x
833, 835 (11th Cir. 2009) (“Relief under Rule 60(b) is an
‘extraordinary remedy which may be invoked upon only a showing
of exceptional circumstances.’” (quoting Crapp v. City of Miami
Beach, 242 F.3d 1017, 1020 (11th Cir. 2001))); see also United
Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 271 (2010)
(expressing that Rule 60(b)(4) applies in “rare” circumstances).
AHCA raises three arguments on the merits in support of its
motion: (1) the formula-based allocation is not quasi-irrebuttable;
(2) this Court ignored the presumption against preemption and
improperly shifted the burden to AHCA; and (3) that a possible
future amendment to federal law will require vacatur of the
injunction at some later date. ECF No. 44, at 4–23.
Those should-have, could-have, and (to round out the trilogy)
would-have arguments are too little, too late. Quite simply, a
motion to alter or amend a judgment is not like a time-traveling
DeLorean; namely, it does not allow an unhappy litigant to
repackage and relitigate previously decided issues or make new
arguments that it wished it made in the first place. Yet that is
precisely what AHCA seeks to do here. Unfortunately for AHCA,
“I want a re-do” is not a valid reason to grant its motion. Nor has
it “articulate[d] any reason” for this Court to allow it to make those
arguments here. Lussier, 904 F.2d at 667. AHCA made a free,
counseled, deliberate choice in deciding what arguments to make
in its original motion and how to make them. It is irrelevant that
the results of that motion are not to AHCA’s liking. AHCA made
its bed the first time around. Now it must lie in it.
AHCA’s motion is especially pernicious in that this litigation
reconsideration motion after receiving an unfavorable ruling—is
all too common for Florida and its agencies. Despite numerous
opportunities to adequately defend cases brought against it,
Florida consistently drags its feet. Then, after receiving an
unfavorable ruling, it complains about the original ruling and
hires outside counsel (and spends, quite literally, hundreds of
millions of taxpayer dollars) 3 to essentially relitigate the case.
Since 2011, Florida has shelled out an astounding $237 million—or
close to $40 million a year—on outside counsel. Gary Fineout, State Spends
Putting that aside, AHCA’s arguments are unavailing. First,
it is, in AHCA’s words, “simply wrong” that this Court committed
manifest error in concluding that the reimbursement statute’s
presumption based on the fact that, as AHCA points out, a handful
of Medicaid recipients have rebutted the reimbursement statute’s
formula-based allocation. ECF No. 44, at 4, 6. AHCA plainly
conceded that it was “not relying upon the practice” of “how
individual [DOAH hearing officer]s may or may not apply the”
formula-based allocation. ECF No. 44-1, at 13, 15. It cannot now
reasonably expect this Court to ignore that concession.
Yet the result would be the same even if it did. That is
because the formula-based allocation is still preempted if, “[i]n
some circumstances, . . . [it] permit[s] the State to take a portion
$237 million on private lawyers, records show, Orlando Sentinel (Mar. 13,
2017), http://www.orlandosentinel.com/news/politics/political-pulse/os-floridalegal-fees-20170313-story.html. For context, New York—which has a larger
population than Florida—spent less than half that amount. Id. And many of
those dollars aren’t even being funneled back into the state; instead, Florida
often sends its taxpayer dollars to other states or jurisdictions. In one case
alone, Florida racked up $97.8 million in attorneys’ fees. Mary Ellen Klas,
Secretary resigned after $98 million in legal fees in Florida water wars, Tampa
Bay Times (Jan. 23, 2017), http://www.tampabay.com/news/secretaryresigned-after-98-million-in-legal-fees-in-florida-water-wars/2310572. Of that
$97.8 million, Latham & Watkins LLP (which does not have a Florida office)
was paid $35.9 million. Id. The two firms involved in that case with Florida
offices—Foley & Lardner LLP and Carlton Fields Jorden Burt, P.A.—were
paid a mere $2.6 million and $966,000, respectively. Id.
of a Medicaid beneficiary’s tort judgment or settlement not
‘designated as payments for medical care.’” Wos v. E.M.A. ex rel.
Johnson, 568 U.S. 627, 644 (2013) (quoting Ahlborn, 547 U.S. at
284). And, after reasoning that the formula-based allocation
ignores allocations made by a judge or jury and has no rational
relationship to the Florida Bar’s attorneys’ fees rules, 4 Gallardo,
2017 WL 1405166, at *9, this Court concluded that it does.
Second, AHCA argues that this Court ignored the
presumption against preemption and improperly shifted “the
burden to AHCA to show whether the default allocation will yield
reasonable results in the mine run of cases . . . .” ECF No. 44, at
13–14. Nonsense. Contrary to AHCA’s assertion, the presumption
AHCA denounces this Court for considering these factors. ECF No. 44,
at 10–12. That denunciation is misplaced. The former was relevant to this
Court’s analysis in that Wos considered whether the statute at issue
“operate[d] to allow the State to take one-third of the total recovery, even if a
proper stipulation or judgment attributes a smaller percentage to medical
expenses.” 568 U.S. at 638. AHCA admitted that the formula-based allocation
at issue here does just that. See ECF No. 44-1, at 11 (acknowledging that
nothing “in the Florida statute . . . says the jury verdict will control the agency’s
lien amount”). Similarly, it was appropriate for this Court to consider the
attorneys’ fees provision. “[A] preemption analysis must contemplate the
practical result of the state law . . . .” United States v. Alabama, 691 F.3d 1269,
1296 (11th Cir. 2012); see also Blue Cross and Blue Shield of Fla., Inc. v. Dep’t
of Banking and Fin., 613 F. Supp. 188, 191 (M.D. Fla. 1985) (explaining that a
preemption analysis requires courts “to consider the relationship between
state and federal laws as they are interpreted and applied, not merely as they
are written” (quoting Jones v. Rath Packing Co., 430 U.S. 519, 526 (1977))).
Considering the attorneys’ fees provision here simply revealed that, as applied,
the formula-based allocation allows AHCA to take more than that which it is
against preemption is an interpretative presumption—not an
evidentiary one. See Fla. State Conference of N.A.A.C.P. v.
Browning, 522 F.3d 1153, 1167–68 (11th Cir. 2008) (explaining
that the presumption against preemption applies to “statutory
interpretation” and, further, that “it is difficult to understand what
a presumption in conflict preemption cases amounts to”); see also
CSX Transp., Inc. v. Healey, Nos. 16-2171, 16-2172, 2017 WL
2703431, at *8 (1st Cir. June 23, 2017)
(stating that the
presumption” (citing Medtronic, Inc. v. Lohr, 518 U.S. 470, 485
(1996))). That presumption “dissipates when the intention of
Congress is ‘clear and manifest.’” Smith v. CSX Transp., Inc., 381
F. App’x 885, 886 (11th Cir. 2010) (quoting Riegel v. Medtronic,
Inc., 552 U.S. 312, 334 (2008)). And that is precisely the case here;
this Court thoroughly analyzed the anti-lien and anti-recovery
provisions and concluded that they preempted portions of Florida’s
Medicaid statute. Such an analysis was eminently appropriate.
See Medtronic, Inc., 518 U.S. at 486 (“Congress’ intent, of course,
is primarily discerned from the language of the pre-emption
statute and the ‘statutory framework’ surrounding it.” (quoting
Gade v. Nat’l Solid Wastes Mgmt. Ass’n, 505 U.S. 88, 111 (1992)
(Kennedy, J., concurring in part and concurring in judgment))).
Moreover, this Court did not improperly shift the burden to
AHCA on summary judgment. See ECF No. 44, at 15 (arguing that
this Court “deviated from the accepted standard on summary
judgment”). Rather, it simply adhered to Wos’s teaching that
Florida could “adopt ex ante administrative criteria for allocating
medical and nonmedical expenses, provided that th[o]se criteria
are backed by evidence suggesting that they are likely to yield
reasonable results in the mine run of cases.” 568 U.S. at 643
(emphasis added). Because AHCA presented zero evidence
suggesting that Florida’s reimbursement statute follows (let alone
considered 5) that teaching, this Court correctly concluded that
portions of it were preempted.
Third, it is immaterial that a potential amendment to the
federal Medicaid Act may (or may not) allow states to “obtain
reimbursement from all or any part of a” Medicaid recipient’s
recovery at some later time. ECF No. 44, at 17. That amendment’s
Although certainly not dispositive, Gallardo’s counsel filed a Public
Records Request seeking records containing “[a]ny analysis by AHCA that
the [formula-based allocation] is a reasonable approximation of the amount
recovered for past medical expenses incurred by AHCA . . . .” ECF No. 51-1,
at 1. In response, AHCA stated that it possessed “no responsive documents.”
ECF No. 51-2, at 1.
effective date has been, at best, mercurial. 6 And even assuming the
amendment does go into effect as planned and actually grants the
states a more expansive right of recovery, other critical questions
would remain unanswered—most relevant here, whether the
amendment applies retroactively or prospectively. In any event,
AHCA can seek relief under Rule 60(b)(5) if and when the Medicaid
amendment goes into effect.
Finally, AHCA contends that this Court’s prior judgment
must be vacated (or at least amended) for lack of subject matter
jurisdiction. More specifically, AHCA argues that Gallardo did not
have standing to sue it because it does not enforce the challenged
portions of Florida’s reimbursement statute. Unlike AHCA’s other
arguments, its jurisdictional one is properly raised at this
juncture. See Fla. Ass’n of Med. Equip. Dealers v. Apfel, 194 F.3d
1227, 1230 (11th Cir. 1999) (“[E]very court has an independent
duty to review standing as a basis for jurisdiction at any time, for
See Bipartisan Budget Act of 2013, Pub. L. 113-67, § 202(c), 127 Stat.
1165, 1177 (2013) (setting effective date of October 1, 2014); Protecting Access
to Medicare Act of 2014, Pub. L. 113-93, § 211, 128 Stat. 1040, 1047 (2014)
(moving effective date October 1, 2016); Medicare Access and Chip
Reauthorization Act of 2015), Pub. L. 114-10, § 220, 129 Stat. 87, 154 (2015)
(moving effective date to October 1, 2017).
every case it adjudicates.” (citing FW/PBS, Inc. v. Dallas, 493 U.S.
215, 230–31 (1990))); see also Fed. R. Civ. P. 12(h)(3) (allowing
subject-matter jurisdiction arguments “at any time”).
Federal courts are not courts of general jurisdiction; instead,
they are limited to hearing actual cases and controversies. U.S.
Const. art. III, § 2. Necessarily baked into this “bedrock
requirement,” Raines v. Byrd, 521 U.S. 811, 818 (1997) (quoting
Valley Force Christian College v. Ams. United for Separation of
Church and State, Inc., 454 U.S. 464, 471 (1982)), is that a plaintiff
have standing, see Via Mat Int’l S. Am. Ltd. v. United States, 446
F.3d 1258, 1262 (11th Cir. 2006) (noting that standing is a
“threshold matter required for a claim to be considered by the
federal courts”). For a plaintiff to have standing, he or she must
establish, among other things, 7 that his or her injury is likely to be
“redressed by a favorable decision.” Nat’l Parks Conservation Ass’n
v. Norton, 324 F.3d 1229, 1241 (11th Cir. 2003) (quoting Lujan v.
A plaintiff must also establish “that he [or she] has suffered an injuryin-fact—that is, an injury that is concrete and particularized, and actual or
imminent” and “a causal connection between the injury and the defendant’s
conduct[.]” Navellier v. Florida, 672 F. App’x 925, 928 (11th Cir. 2016) (citing
DiMaio v. Democratic Nat’l Comm., 520 F.3d 1299, 1302 (11th Cir. 2008)).
Those requirements, however, are not at issue here.
Defenders of Wildlife, 504 U.S. 555, 560–61 (1992)). This is
commonly referred to as the “redressability” prong. 8 I.L. v.
Alabama, 739 F.3d 1273, 1278 (11th Cir. 2014).
Reduced to its most basic form, the redressability prong
ensures that the court’s judgment has teeth and can effectively
rectify a cognizable injury. “Relief that does not remedy the injury
suffered” is no relief at all and certainly “cannot bootstrap a
plaintiff into federal court . . . .” Steel Co. v. Citizens for a Better
Environment, 523 U.S. 83, 107 (1998). Thus, in suits such as this
unconstitutionality of a state statute and an injunction against its
enforcement, a state officer, in order to be an appropriate
defendant, must, at a minimum, have some connection with
One minor point of clarification. At the June 15, 2017, hearing, this
Court did not ask “the parties to consider whether a less rigorous standard of
redressability applies to claims for declaratory relief than to claims for
injunctive relief.” ECF No. 54, at 2. Nor did it imply (much less state) that some
different redressability standard applied to claims for declaratory relief.
Indeed, it is without question that “[t]he requirements for a justiciable case or
controversy are no less strict in a declaratory judgment proceeding than in any
other type of suit.” Ala. State Fed’n of Labor, Local Union No. 103 v. McAdory,
325 U.S. 450, 561 (1945) (citations omitted). Rather, it simply asked whether
those identical redressability principles apply differently to cases of
declaratory relief such that it is possible to have standing for declaratory relief,
but not injunctive relief. It is. See Doe v. Stincer, 175 F.3d 879, 887 n.6 (11th
Cir. 1999) (concluding that the plaintiff had standing to sue the state Attorney
General even assuming that he “lack[ed] the necessary enforcement authority
to support the grant of injunctive relief enjoining the statute’s enforcement”
because “a favorable ruling could result in a declaratory judgment against the
Attorney General holding the Florida statute invalid”).
enforcement of the provision at issue.” Socialist Workers Party v.
Leahy, 145 F.3d 1240, 1248 (11th Cir. 1998) (emphasis added)
(citations omitted). If relief is sought against an official who cannot
remedy the plaintiff’s alleged injury, there is no “‘case or
controversy’ between himself and the defendant[s] within the
meaning of Art[icle] III.” Scott v. Taylor, 405 F.3d 1251, 1259 (11th
Cir. 2005) (Jordan, J., concurring) (emphasis added) (quoting
Warth v. Seldin, 422 U.S. 490, 498 (1975)).
Injunctive relief will be addressed first. The amended
judgment enjoined AHCA “from enforcing [§ 409.910(17)(b)] in its
current form.” Gallardo, 2017 WL 1405166, at *11. Yet AHCA
states that it cannot enforce that injunction because it does not
“decide what burden of proof applies or whether the recipient has
satisfied that burden”; that task is reserved for DOAH. ECF No.
44, at 24. While this Court recognizes and agrees that AHCA does
not apply the clear and convincing burden, that fact is not
determinative of the standing question.
Common sense dictates that courts cannot force a defendant
“to act in any way that is beyond [the defendant’s] authority to act
in the first place.” Okpalobi v. Foster, 244 F.3d 405, 427 (5th Cir.
2001); see also Swan v. Bd. of Educ. Of City of Chicago, 956 F.
Supp. 2d 913, 918 (N.D. Ill. 2013) (“[W]here . . . a plaintiff seeks an
injunction against a defendant, he or she must demonstrate that
the defendant to be enjoined has the authority to effectuate the
injunction.” (citations omitted)). That is because, absent such
authority, the defendant would be “powerless to remedy the
alleged injury.” Scott, 405 F.3d at 1259 (citations omitted). In other
words, enjoining such a defendant “would be a meaningless
gesture.” Bronson v. Swensen, 500 F.3d 1099, 1112 (10th Cir.
And this Court was well aware of that fact when it enjoined
AHCA from enforcing the current iteration of the reimbursement
statute. By no means did it intend to enjoin AHCA from requiring
a recipient to overcome the formula-based allocation with clear and
evidence for that recipient to be successful—that would be an
exercise in futility. Rather, it simply meant to enjoin AHCA from
seeking reimbursement for past medical expenses through
portions of a recipient’s recovery that represents future medical
expenses either directly from the recipient 9 or through DOAH. 10
By extension, that also means AHCA cannot seek reimbursement
based on the formula-based allocation when doing so would allow
it to obtain more than that which it is entitled to. Those are both
tasks that AHCA—which is responsible for administering
Medicaid and asserting Medicaid liens—“ha[s] some connection
with . . . .” Socialist Workers Party, 145 F.3d at 1248 (emphasis
added) (citations omitted). 11 Therefore, AHCA is properly enjoined
from “seeking reimbursement of past Medicaid payments from
portions of a recipient’s recovery that represents future medical
expenses.” Gallardo, 2017 WL 1405166, at *11. 12
A lien only makes it to AHCA if the recipient contests it. §
409.910(17)(b), Fla. Stat. (2016). Thus, for the vast majority of liens that go
uncontested, AHCA is the only entity involved in the reimbursement process.
For simplicity sake, this Court will refer to this as the
“reimbursement portion of the judgment.”
On this point, the cases cited by AHCA are distinguishable. Take
Socialist Workers Party v. Leahy, 145 F.3d 1240 (11th Cir. 1998). There, the
plaintiff lacked standing to bring suit against certain defendants because they
lacked the authority to enforce the challenged statutes. See id. at 1248
(denying standing for injunctive relief because the relevant defendants “ha[d]
no authority to enforce” the challenged statute). But AHCA wields such
authority. For example, it “is the Medicaid agency for the state, as provided
under federal law[,]” § 409.901(2), Fla. Stat. (2016), and is permitted “as a
matter of right, in order to enforce its rights” to “institute, intervene in, or join
any legal or administrative proceeding in its own name . . . .” § 409.910(11),
Fla. Stat. (2016).
For that same reason, declaratory relief is proper as well.
With that said, this Court is not so prideful that it will not
acknowledge its mistakes. It freely admits that, at least with
regards to the injunction’s scope, the prior judgment is not a model
of clarity. It will therefore be amended to clarify that it does not
extend to the portion referencing the reimbursement statute’s
clear and convincing burden.
One issue therefore remains: whether it was nonetheless
proper for this Court to declare that the reimbursement statute’s
clear and convincing burden is preempted by the federal Medicaid
Act even though DOAH—not AHCA—applies that standard. It
Declaratory relief is appropriate when a favorable ruling for
one party may result in “a change in a legal status . . . and the
practical consequence of that change would amount to a significant
increase in the likelihood that the plaintiff would obtain relief that
directly redresses the injury suffered.” Utah v. Evans, 536 U.S.
452, 464 (2002) (citations omitted). Generally, the availability of
such relief hinges on the declaration’s capacity to secure redress
“through the court, but from the defendant.” Canup v. Chimpan–
Union, Inc., 123 F.3d 1440, 1443 (11th Cir. 1997) (emphasis in
original) (quoting Hewitt v. Helms, 482 U.S. 755, 761 (1987)). But
it isn’t always so cut and dried; rather, standing is also appropriate
if the redress is effectuated by an unnamed third party or parties,
the steps necessary to effectuate that redress are “purely
mechanical,” and it is “substantially likely that the [third party or
parties] would abide by an authoritative interpretation” of the
court’s ruling. Evans, 536 U.S. at 463–64 (quoting Franklin v.
Massachusetts, 505 U.S. 788, 803 (1992)).
An example is helpful. In Evans, Utah brought suit against
the Census Bureau and the Secretary of Commerce seeking,
among other things, a declaration that a certain method of
“imputing” census information—specifically, the number of people
living in a certain household—violated federal law. Id. at 459. 13 At
bottom, Utah argued that “imputing” the size of those households
that the Census Bureau lacked information about caused it to
representatives than if the number of individuals living in those
The process at issue in Evans is, to put it lightly, dizzying. Suffice it
to say that Census Bureau employees would attempt to obtain household
information through a variety of different channels. If those attempts were
unsuccessful, the Bureau would “impute” the relevant information—including
the number of people living in the unknown household—by inferring the
unknown household’s characteristics from those of a nearby one. Evans, 536
U.S. at 457–58.
households was simply counted as “zero.” Id. at 458. North
Carolina, which benefited from such “imputing,” argued that a
favorable ruling would not redress Utah’s asserted injury. Id. at
459. That was because such redress would require a perfectly
executed domino effect, yet some of those other dominoes were not
named parties: the Secretary of Commerce would have to create a
new report and submit it to the President, who would then
transmit that report to Congress, and finally (after some time) the
Clerk of the House of Representatives would notify each individual
state how many congressional seats it was entitled to. Id. at 461.
Thus, according to North Carolina, Utah’s asserted redress was
through the Court, but not from the defendants. See id. (restating
North Carolina’s argument that the ultimate relief “cannot help
bring about th[e] ultimate ‘redress’”).
But the Supreme Court disagreed. It reasoned that a ruling
in Utah’s favor would force the Secretary of Commerce to create a
new report. Id. at 463. If that report “contain[ed] a different
conclusion about the relative populations of North Carolina and
Utah,” then it would eventually go into effect. Id. It was
immaterial that other dominoes needed to fall with absolute
precision for that to occur; those subsequent “apportionment23
related steps would be purely mechanical . . . .” Id. And, under
those circumstances, it was “substantially likely that the President
and other executive and congressional officials would abide by an
constitutional provision . . . .” 14 Id. at 464 (quoting Franklin, 505
U.S. at 803). In other words, a favorable ruling “would amount to
a significant increase in the likelihood that the plaintiff would
obtain relief that directly addresses the injury suffered.” Id. at 564.
Similar to Evans, a declaration that the reimbursement
statute’s clear and convincing burden is preempted by federal law
would also significantly increase the likelihood that Gallardo
would obtain the redress she seeks. Of course, unlike the
reimbursement portion of the prior judgment, this Court’s
declaration that the clear and convincing burden is preempted in
this type of scenario would require additional steps to redress
Gallardo’s injury; namely, DOAH not requiring Gallardo to
disprove the reimbursement statute’s formula-based allocation
with clear and convincing evidence in Gallardo’s administrative
That was so even though the President was “not expressly required
to adhere to the policy decisions reflected in the Secretary [of Commerce]’s
report.” Franklin v. Massachusetts, 505 U.S. 788, 799 (1992).
proceeding. But that step is “purely mechanical.” Id. at 463. What
is more, though, is that DOAH—which is, in effect, a quasi-judicial
body 15—is substantially likely to “abide by an authoritative
interpretation[,]” id., at 464, from this Court (and through AHCA)
that it cannot apply such a burden.
There is more. Even if the additional steps were not “purely
mechanical” such that Evans applied, id., this Court could
nonetheless assume that DOAH “will give full credence” to this
Court’s ruling. Roe v. Wade, 410 U.S. 113, 166 (1973); see also
Phelps v. Powers, 63 F. Supp. 3d 943, 958 (S.D. Iowa 2014)
(suggesting that declaratory relief was sufficient “based on the
assumption that the Iowa prosecutorial authorities will give full
credence to th[e] Court’s holding”). That would also make
declaratory relief appropriate. See Roe, 410 U.S. at 166; Phelps, 63
F. Supp. 3d at 958.
AHCA’s pleas to the contrary are unpersuasive. It cites cases
like Nova Health Systems v. Gandy, 416 F.3d 1149 (10th Cir.
2005), to argue that Gallardo lacks standing for declaratory relief
See Fla. State Univ. v. Hatton, 672 So.2d 576, 579 (1st DCA 1996)
(stating that DOAH hearing officers are “quasi-judicial officer[s] of a quasijudicial forum”).
as to the reimbursement statute’s clear and convincing burden. In
that case, an Oklahoma statute provided that those who performed
an abortion on a minor without parental consent or knowledge
were liable “for the cost of any subsequent medical treatment such
minor might require because of the abortion.” Id. at 1153 (citation
omitted). The plaintiff filed suit against four “Oklahoma public
officials whose functions include overseeing certain state medical
institutions” seeking, among other things, a declaration that the
statute was unconstitutional. Id. at 1153–54. Those four
defendants, however, did not represent the only institutions where
subsequent medical treatment for those minors took place; they
were just four big-name players. Id. at 1157, 1159. That made it
“entirely speculative” that a declaration in the plaintiff’s favor
would redress its injury. Id. at 1159. Such relief was therefore
inappropriate. See id. (rejecting the argument “that a favorable
declaratory judgment against the defendants would redress its
injury by deterring other potential litigants from relying on [the
statute at issue], even in state court”).
But that case, like the other similar cases that AHCA relies
on, is distinguishable on two fronts. First, it ignores Evans (and,
for that matter, Roe as well). Instead, it—and AHCA—cites
Scalia’s concurrence in Franklin for the proposition that
“[r]edressability requires that the court be able to afford relief
through the exercise of its power, not through the persuasive or
even awe-inspiring effect of the opinion explaining the exercise of
its power.” Id. (quoting Franklin, 505 U.S. at 825 (Scalia, J.,
concurring in the judgment)). But that concurrence persuaded
neither the Franklin plurality nor the Evans Court. This Court is
at a loss as to why it should apply such logic here. Second, unlike
Gandy, there aren’t a myriad of other parties who can assert liens
against a Florida Medicaid recipient’s recovery, thus kick starting
the process to possibly bring the recipient before DOAH to
challenge that lien. Who else could be expected to assert such a
lien, and then allow the subsequent “purely mechanical” steps to
take place such that the recipient could receive the type of redress
sought here? The answer is simple: AHCA, and only AHCA. See
ECF No. 5, at 1 (admitting that AHCA is responsible for enforcing
In short, AHCA is absolutely correct that it cannot be
enjoined from requiring a recipient to overcome the formula-based
allocation with clear and convincing evidence for that recipient to
be successful. DOAH applies that standard, not AHCA. The prior
judgment will therefore be amended to clarify the injunction’s
scope. But that doesn’t divest this Court of standing to address the
reimbursement statute’s clear and convincing burden. Rather, it
properly declared that applying such a burden—at least in certain
circumstances—runs afoul of and is therefore preempted by
federal law. AHCA’s motion is therefore GRANTED in part and
DENIED in part.
IT IS ORDERED:
1. AHCA’s Motion to Alter or Amend the Judgment and for
Relief from Judgment, ECF No. 44, is GRANTED in part
and DENIED in part.
2. AHCA’s motion is GRANTED to the extent that it seeks
an amendment clarifying the injunction’s scope.
3. The balance of AHCA’s motion is DENIED.
4. The Clerk shall enter a second amended judgment
Gianinna Gallardo, an incapacitated person, by
and through her parents and co-guardians, Pilar
Vassallo and Walter Gallardo, successfully
proved that portions of § 409.910(11)(f), Fla.
Stat. (2016) and § 409.910(17)(b), Fla. Stat.
(2016) are preempted by federal law.
It is declared that the federal Medicaid Act
prohibits the State of Florida Agency for Health
reimbursement of past Medicaid payments from
portions of a recipient’s recovery that represents
future medical expenses. The State of Florida
Agency for Health Care Administration is
therefore enjoined from doing just that: seeking
reimbursement of past Medicaid payments from
portions of a recipient’s recovery that represents
future medical expenses.
It is also declared that the federal Medicaid Act
prohibits the State of Florida from requiring a
Medicaid recipient to affirmatively disprove §
409.910(17)(b)’s formula-based allocation with
clear and convincing evidence to successfully
challenge it where, as here, that allocation is
arbitrary and there is no evidence that it is
likely to yield reasonable results in the mine run
SO ORDERED on July 18, 2017.
s/Mark E. Walker
United States District Judge
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