COLUMBUS REGIONAL HOSPITAL v. FEDERAL EMERGENCY MANAGEMENT ADMINISTRATION
Filing
106
ORDER denying 60 Plaintiff's Motion for Reconsideration of and Objection to Magistrate Judge's August 9, 2011 Order on Motions. Signed by Judge Sarah Evans Barker on 3/28/2012. (PGS)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION
COLUMBUS REGIONAL HOSPITAL,
Plaintiff,
vs.
FEDERAL EMERGENCY MANAGEMENT
ADMINISTRATION,
Defendant.
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) NO. 1:10-cv-01168-SEB-MJD
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ORDER DENYING/OVERRULING PLAINTIFF’S MOTION FOR RECONSIDERATION
OF AND OBJECTION TO THE MAGISTRATE JUDGE’S RULING
(Docket No. 60)
On August 9, 2011, Magistrate Judge Mark Dinsmore issued an
order denying Plaintiff Columbus Regional Hospital’s (“CRH”)
Rule 56(d) Motion for a Continuance to Allow Discovery [Docket
No. 43] and Motion to Enter its Case Management Plan [Dkt. 13],
and granting Defendant the Federal Emergency Management
Administration’s (“FEMA”) Motion Regarding the Case Management
Plan and to Stay Discovery [Docket No. 15]. [Docket No. 58].
On
August 23, 2011, CRH filed its objection to the Magistrate
Judge’s order and moved the Court to reconsider and set aside
Magistrate Judge Dinsmore’s ruling. [Docket No. 60].
Having
reviewed the Magistrate Judge’s ruling, the pending Objection to
the Magistrate Judge’s Order, and the Defendant’s response
thereto, we find nothing about the Magistrate Judge’s Order
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issued on August 9, 2011 that is clearly erroneous or contrary
to law.
STANDARD OF REVIEW
Pursuant to Federal Rule of Civil Procedure 72(a) and 28
U.S.C. § 636(b), the Court must consider and modify or set aside
the pretrial ruling, or any part thereof, issued by a magistrate
judge that is clearly erroneous or contrary to law.
Using the
clear error standard, the Court will sustain the objection “only
if [it] is left with the definite and firm conviction that a
mistake has been made.”
Weeks v. Samsung Heavy Indus., Ltd.,
126 F.3d 926, 943 (7th Cir. 1997).
FACTUAL AND PROCEDURAL BACKGROUND
A brief summary of the relevant facts provide as follows:
CRH received $70 million in taxpayer funded grants from FEMA
following a flood that occurred throughout major portions of
southern Indiana in June 2008.
CRH contends that it is entitled
to approximately $17.1 million in additional grants, and alleges
that FEMA violated the Stafford Act, 42 U.S.C. §§ 5121, et seq.
(“Stafford Act”), the Administrative Procedures Act, 5 U.S.C. §§
551 et seq. (“APA”), the Federal Tort Claims Act, 28 U.S.C. §§
2671 et seq. (“FTCA”) and the Due Process Clause of the Fifth
Amendment in its decision not to grant these additional funds.
On February 18, 2011 FEMA filed a Motion to Dismiss or in
the Alternative for Summary Judgment, along with the
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administrative record, addressing jurisdictional and threshold
issues, as well as the APA claims.1 [Dkt. 26]
CRH then filed its
Motion for Continuance to Allow Discovery Under Rule 56(d) on
May 4, 2011, seeking a continuance to allow depositions and
other discovery that CRH claims are necessary for it to respond
to FEMA’s dispositive motion.
Magistrate Judge Dinsmore denied
CRH’s request for discovery, concluding that the discovery was
not necessary in order for CRH to respond to FEMA’s dispositive
motion, and in turn denied CRH’s motion to enter its case
management plan and granted FEMA’s motion to stay discovery.
DISCUSSION
Federal Rule of Civil Procedure 56(d) provides that a court
may permit a party to take discovery if the party shows by
affidavit or declaration that, for specified reasons, it cannot
present facts essential to justify its opposition to a summary
judgment motion.
Fed. R. Civ. P. 56(d)(2).
Although CRH argues
in its opposition brief that Magistrate Judge Dinsmore erred by
relying on the legal standard applicable to requests for
discovery on a Rule 56 summary judgment motion and instead
should have analyzed the need for discovery under Rule 12(b)(1)
[Docket No. 60 at 2], CRH conceded that FEMA’s dispositive
motion should be treated as a motion for summary judgment both
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This motion was withdrawn per the Court’s order dated April 29, 2011 [Docket No. 42]
and re-filed as FEMA’s Second Motion to Dismiss or in the Alternative Motion for
Summary Judgment on April 28, 2011. [Docket No. 40].
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in its Brief in Support of its Motion for Discovery [Docket No.
44 at 6] and at oral argument before Magistrate Judge Dinsmore
on June 29, 2011. [Docket No. 68-1 at 8:18-23].
Additionally,
in the Seventh Circuit, a sovereign immunity defense is not a
jurisdictional issue analyzed under Rule 12(b)(1), but rather
under Rule 12(b)(6). “A standard rule in considering
jurisdictional challenges is that when the court's jurisdiction
and the claim for relief are predicated on the same federal
statute but the basis for relief is subsequently found to be
inapplicable, the district court should not dismiss the case
under Rule 12(b)(1), but rather proceed as if jurisdiction
exists and determine the merits of the claim under Rule
12(b)(6).” Frey v. E.P.A., 270 F.3d 1129, 1131 (7th Cir.
2001)(quoting Central States, Southeast and Southwest Areas
Health and Welfare Fund v. Neurobehavioral Assos., 53 F.3d 172,
174 (7th Cir.1995)).
The Seventh Circuit has recognized that
“the proper inquiry is not one of jurisdiction, but whether the
United States has a defense to suit.” Williams v. Fleming, 597
F.3d 820, 824 (7th Cir. 2010).
Limits on the Government’s
waiver of sovereign immunity do not withdraw subject-matter
jurisdiction from the federal courts; thus, the Government’s
motion to dismiss on the basis of sovereign immunity is properly
treated as a motion to dismiss for failure to state a claim
under Rule 12(b)(6).
Both parties have conceded that FEMA’s
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motion to dismiss must be treated as a motion for summary
judgment under Rule 56, and the Court agrees that the Magistrate
Judge’s order utilized the proper standard.
A. Stafford Act Claim
In analyzing whether discovery is needed for CRH to respond
to FEMA’s assertion that CRH’s Stafford Act claims should be
dismissed on the basis of sovereign immunity, the Magistrate
Judge acted well within his lawful discretion in determining
that CRH could respond to FEMA’s motion without the need for
additional discovery.
In our view, the Magistrate Judge
properly determined that CRH already possessed enough evidence
to address whether there is some other basis upon which FEMA has
waived sovereign immunity, which is the threshold issue
addressed in FEMA’s dispositive motion.
Thus, the decision not
to permit discovery on CRH’s Stafford Act claim was not clearly
erroneous or contrary to law.
B. APA Claim
As acknowledged by CRH, a court’s review of an agency’s
decision typically is limited to the administrative record.
[Docket No. 60 at 10].
Discovery is generally not appropriate
for claims brought under the APA, and judicial review of the
agency’s action is based upon the record the agency presents to
the reviewing court.
Florida Power & Light Co. v. Lorion, 470
U.S. 729, 743-44 (1985). While there is an exception where the
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plaintiff can show bad faith, bias, or that the record is
incomplete, the Magistrate Judge’s determination that CRH’s
affidavits and evidence presented at oral argument did not
demonstrate the requisite “strong showing” that these exceptions
apply such that extra-record inquiry is necessary.
The
Magistrate Judge’s order denying CRH’s discovery on its APA
claims was not clearly erroneous or contrary to law.
C. FTCA Claim
The requirement that a plaintiff exhaust its administrative
remedies prior to instituting a suit against a federal agency is
fairly straightforward.
A claimant may not institute a claim
against a federal agency in federal court until the federal
agency denies the claim, or six months after the claimant has
presented the claim to the agency.
28 U.S.C. § 2675. CRH must
only show that it complied with the statute’s requirements in
exhausting its administrative remedies in order to address
FEMA’s argument.
The Court agrees with the Magistrate Judge’s
determination that CRH does not need any discovery in order to
address FEMA’s assertion that CRH failed to file its claim with
the agency prior to filing this lawsuit, and this decision was
not clearly erroneous.
D. Due Process Claim
FEMA alleges in its dispositive motion that CRH has failed
to state a due process claim because it does not have a
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protectable property interest, which is the fundamental issue
that CRH must address in its opposition to FEMA’s motion.
CRH’s
opposition to the Magistrate Judge’s order does not point to any
additional evidence that is necessary and that must be obtained
via discovery that would address this threshold issue.
Instead,
CRH glosses over this fundamental prerequisite and proceeds as
if it has already been established that CRH has a protectable
property interest and has properly asserted a due process claim.
The Magistrate Judge’s determination that CRH does not need
additional discovery to respond to this allegation in FEMA’s
dispositive motion is not in error.
CONCLUSION
For the foregoing reason, the Court OVERRULES CRH’s
Objection to the Magistrate Judge’s August 9, 2011 Order on
Motions.
Accordingly, that order is affirmed.
Date: 03/28/2012
_______________________________
SARAH EVANS BARKER, JUDGE
United States District Court
Southern District of Indiana
Distribution:
Electronically registered counsel of record
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