OLSEN et al v. HAMILTON

Filing 48

ORDER ON THE PENDING MOTIONS - denying 19 Motion for Preliminary Injunction; denying 29 Motion for TRO; granting 32 Motion to Dismiss Second Amended Complaint. By JUDGE NANCY TORRESEN. (mnw)

UNITED STATES DISTRICT COURT
DISTRICT OF MAINE
JUSTIN OLSEN and NANCY SHAW,
individuals doing business as NEW
WORLD ORGANICS, JANE DOE,
and JOHN DOE,
Plaintiffs,
v.
RICKLER HAMILTON, in his official
capacity as the Commissioner of the
Maine Department of Health and
Human Services,
Defendant.

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ORDER ON THE PENDING MOTIONS
This suit against the Commissioner of the Maine Department of Health and
Human Services (“MDHHS” or “the Department”) is a pre-enforcement, facial
challenge to the rules implemented by the MDHHS this year under the Maine
Medical Marijuana Act (“MMMA”). The operative Second Amended Complaint
(“SAC”) seeks declaratory and injunctive relief on three counts. Count One alleges
that Section 10 of the MDHHS rule, which relates to compliance and enforcement,
exceeded the agency’s delegated legislative authority in violation of the Maine
Administrative Procedures Act, 5 M.R.S. §§ 8051-8074 (2013). Count Two alleges that
Section 10 of the rule authorizes the search and seizure of participants’ homes and
workspaces in violation of the Fourth Amendment and allows questioning of
participants in violation of the Fifth Amendment. Count Three alleges that Section
10 of the rule provides for disclosure of medical marijuana patient information to the

MDHHS in violation of the federal Health Insurance Portability and Accountability
Act of 1996 (“HIPAA”), Pub. L. No. 104-191, § 264, 110 Stat. 1936 (1996), and its
Privacy Rule, 45 C.F.R. §§ 164.502(a) and 164.508(a)(1).
The motions now before me are the Plaintiffs’ motions for a temporary
restraining order and a preliminary injunction seeking to restrain the State from
implementing Section 10 of the MMMA rule (ECF Nos. 19, 29) and the Defendant’s
motion to dismiss under Federal Rules of Civil Procedure 12(b)(1) for lack of
justiciability and 12(b)(6) for failure to state a claim. (ECF No. 32.) For the following
reasons, the Defendant’s motion to dismiss is GRANTED and the Plaintiffs’ motions
are DENIED.
FACTUAL BACKGROUND
The MMMA provides for the legal use of marijuana to treat certain debilitating
conditions. Under this framework, patients who qualify may obtain marijuana
lawfully by: (1) growing limited amounts for themselves, (2) buying it from a
registered “caregiver,” or (3) buying it from a registered dispensary.1 SAC ¶ 19.
A “qualifying patient” is defined as “a person who has been diagnosed by a
medical provider as having a debilitating medical condition and who possesses a valid
written certification regarding medical use of marijuana.” 22 M.R.S. § 2422(9).
Although qualifying patients can register with the State, they are not required to do
so. 22 M.R.S. §§ 2425(9-A). A “caregiver” is, in essence, a person who is designated by

Dispensaries are subject to on-site assessments as well, but since they are not the focus of this
lawsuit, I do not address the rules that apply to dispensaries.
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the qualifying patient to provide care to that patient and who is allowed, for the
purposes of assisting the qualifying patient, to grow, store, and sell limited amounts
of marijuana for up to five patients. 22 M.R.S. §§ 2422(8-A), 2423-A(2); SAC ¶ 20.
Caregivers, unless they fall into an exemption for family members of qualifying
patients, are required to register with MDHHS. 22 M.R.S. §§ 2425(9-A), 2423-A(3)(C).
Caregivers must complete an application indicating the number (but not the names)
of the patients that they serve. SAC Ex. D-1 (ECF 18-4). As of 2016, there were 51,324
qualifying patients and 3,258 caregivers in Maine. SAC ¶¶ 18-19.
When the MMMA became law in 2009, it authorized the MDHHS “to adopt
rules to carry out the purposes of this chapter.” 22 M.R.S. § 2424. The MDHHS most
recently amended its implementing rules in February 2018 through the Maine
Medical Use of Marijuana Program Rule (“the 2018 Rule”). (ECF No. 18-1.) The 2018
Rule addresses, inter alia, marijuana cultivation, certification and registration of
participants, and compliance and enforcement.
The authorization to conduct on-site assessments contained in the compliance
and enforcement rules found in Section 10 of the 2018 Rule is the focus of this suit.
An “on-site assessment” is defined as
the review process to determine compliance. An on-site assessment may
include a paper review, interview and inspection of the medical
marijuana cultivation, processing and retail sites and administrative
locations for the purpose of ensuring compliance with the requirements
of the statute and this rule.
2018 Rule § (1)(Q). Section 10 provides that MDHHS “may initiate an on-site
assessment . . . to ensure compliance prior to issuing a registry identification card, as
a routine review, in response to an allegation of non-compliance or as part of a plan
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of correction.” 2018 Rule § 10(B). During an on-site assessment, the Department’s
mission is primarily to: (1) verify information submitted in an application; (2) review
records; (3) conduct interviews; (4) ensure that the amount of marijuana is within the
specified limits and that it is identifiable and maintained as required; (5) take
samples; and (6) assess conduct for compliance with the statute. 2018 Rule § 10(B)(1).
On-site assessments may occur in areas “reportedly used by a registered
primary caregiver for conduct authorized by this rule,” regardless of whether it is a
workspace or a residence, and “areas within a person’s residence reportedly used for
conduct authorized by this rule.” 2018 Rule § 10(B)(3)(a)-(c). Registered caregivers
will not receive advance notice before an inspection, but those who are not required
to register (e.g., patients) will receive at least 24 hours advance notice. 2018 Rule
§ 10(B)(3)(a)-(c). A provision headed “Prior to entry” states:
The Department will show proof of identity when requesting entry to
conduct an on-site assessment and to inspect an area reportedly used
for conduct described under this rule and the statute. The Department
will also provide the reason for the on-site assessment in standard
written form developed by the Department prior to entry.
2018 Rule § 10(B)(4).
If a registered caregiver or qualifying patient refuses to allow the Department
entry during an on-site assessment, the 2018 Rule provides that:
the Department will consider such an action a failure to comply with the
provisions of this rule.
a.
Upon refusal, the Department may refer to law enforcement as a
progressive enforcement action when compliance cannot be determined.
b.
Additionally, if denied entry by a cardholder, the Department
may also take action to revoke the registry identification card or
dispensary registration certificate.
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2018 Rule § 10(B)(7). Section 10 also states:
Failure to comply with provisions of statute and rule may result in
remedial action up to, and including, directed corrective action;
suspension, revocation and denial of a registry identification card or
registration certificate; civil penalties; and referral to the appropriate
agency, department or entity if the conduct is determined to be outside
the scope of MMMP, is not appropriate for agency directed corrective
action, or has not been rectified through corrective action.
2018 Rule § 10(A)(4).
The Plaintiffs assert that recent passage of the Maine Marijuana Legalization
Act (“MMLA”) makes available marijuana that is less regulated and “will likely
entice current medical marijuana patients, and future such patients, to consider
foregoing compliance” with the MMMA. SAC ¶ 54. The Plaintiffs fear that this will
lead patients to seek marijuana from sources that are not subject to background
checks and do not provide careful prescriptions. SAC ¶ 54. The Plaintiffs allege that
“[t]his enticement will be substantially greater if the present search-and-seizure
provisions under the 2018 Rule that is the subject of this action are not enjoined with
the attendant disclosure to the state of Maine of the identity of medical marijuana
patients within this state.” SAC ¶ 54.
There are four plaintiffs in this suit. Plaintiffs Justin Olsen and Nancy Shaw
are authorized caregivers under the MMMA who conduct business as New World
Organics, Inc. in Belfast, Maine. SAC ¶¶ 9-10. As caregivers, they receive patient
designations and certifications from medical providers, including records regarding
the patients’ medical conditions and symptoms. SAC ¶ 31. They also counsel
qualifying patients on the use of medical marijuana and dispense medical marijuana
to qualifying patients. SAC ¶ 28. Plaintiffs Jane Doe and John Doe are qualifying
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patients under the MMMA. SAC ¶¶ 11-12. Jane Doe has cancer, and John Doe
experiences pain from injuries sustained in combat while deployed with the U.S.
Army. SAC ¶¶ 11-12. Olsen and Shaw “have acted” as the caregivers for Jane Doe
and John Doe. SAC ¶ 21. The Defendant is Ricker Hamilton, in his official capacity
as the Commissioner of the MDHHS.2
Plaintiffs Olsen and Shaw received a form letter from the MDHHS dated May
10, 2018, with the subject line “Maine Medical Use of Marijuana Program (MMMP)
2018 Rule.” Olsen Decl. Ex. A-1 (ECF No. 47-1). The letter was addressed to “MMMP
Participant,” and stated that “MMMP is implementing its revised rule (original
implementation) as of the date of this letter,” and included a link the MDHHS’s
website on the 2018 Rule. Olsen Decl. Ex. A-1. A Frequently Asked Questions section
of the website includes the following text:
Section 10
Can the Department inspect a patient?
Yes, the Department may request permission to inspect the premises
used by a qualifying patient for conduct authorized under this chapter.
The Department assesses conduct reported as a violation of the rule or
statute by making contact by phone or requesting access to locations
where this conduct is reportedly taking place. The patient may
voluntarily permit entry or request an administrative warrant before
allowing the Department to enter the location which may be the
patient’s home. When the Department is refused entry or otherwise
unable to ensure compliance, the Department may proceed with
obtaining an administrative warrant and/or refer to law enforcement.
Olsen Decl. Ex. A-4 (ECF No. 47-1).

Effective May 2, 2018, responsibility for administering the medical marijuana program has
transferred to the Department of Administrative and Financial Services. P.L. 2017, ch. 409, § E-12.
Neither the Plaintiffs nor the Defendant have moved to change the named defendant or add an
additional party.
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PROCEDURAL HISTORY
The Plaintiffs filed this suit on January 16, 2018. On the same day, the
Plaintiffs also filed a motion to proceed under the aliases Jane Doe and John Doe.
(ECF No. 4.) The Plaintiffs subsequently amended their complaint twice; the
operative SAC was filed January 30, 2018. On January 31, 2018, the Plaintiffs filed
a motion for a preliminary injunction. (ECF No. 19.) Later on the same day, the
Governor issued a public notice that he would stay the implementation of the 2018
Rule by 90 days until May 1, 2018, and the Plaintiffs filed a motion to stay this action
for 90 days, which was granted on February 2, 2018. (ECF Nos. 21, 22.)
On May 7, 2018, the Plaintiffs filed a motion for a temporary restraining order
(“TRO”) or for an expedited briefing schedule. (ECF No. 29.) I responded to the TRO
motion that same day, issuing a text order granting the expedited briefing schedule
but reserving on the motion for the TRO. On May 14, 2018, ahead of oral argument
on the preliminary injunction, the Defendant filed a motion to dismiss the SAC under
Federal Rules of Civil Procedure 12(b)(1) for lack of justiciability and 12(b)(6) for
failure to state a claim. (ECF No. 32.)
Oral argument was held May 23, 2018, at which I conditionally granted the
motion to proceed under aliases. (ECF No. 42.) This order follows on the pending
motions for preliminary injunction, TRO, and dismissal of the SAC.
LEGAL STANDARD
The court has an obligation to ensure that it has jurisdiction before proceeding
to the merits. Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 88-89 (1998). Article
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III provides federal courts with limited jurisdiction, which only extends to actual
cases and controversies. The related justiciability doctrines of standing and ripeness
are at issue in this case.
The justiciability doctrine of standing requires that a plaintiff allege “such a
personal stake in the outcome of the controversy as to assure that concrete
adverseness which sharpens the presentation of issues upon which the court so
largely depends for illumination of difficult constitutional questions.” Baker v. Carr,
369 U.S. 186, 204 (1962). To establish standing, the plaintiff bears the burden of
showing “(i) that she has suffered an actual or threatened injury in fact, which is (ii)
fairly traceable to the statute, and (iii) can be redressed by a favorable decision.”
Ramirez v. Sanchez Ramos, 438 F.3d 92, 97 (1st Cir. 2006) (citing Lujan v. Defenders
of Wildlife, 504 U.S. 555, 560-61 (1992)). In addition to the Article III requirements,
prudential standing concerns include that the plaintiff is seeking to protect her own
legal rights, that her complaint does not represent a generalized grievance, and that
the complainant falls in the zone of interests protected by the law invoked. Pagan v.
Calderon, 448 F.3d 16, 27 (1st Cir. 2006).
The ripeness analysis considers the two prongs of “fitness” and “hardship.”
Reddy v. Foster, 845 F.3d 493, 501 (1st Cir. 2017). Fitness involves both whether there
is a case or controversy to satisfy Article III and prudential considerations about
“judicial restraint from unnecessary decision of constitutional issues.” Id. The
hardship prong deals with prudential concerns about the harm to parties from
withholding a decision. Id.

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The doctrines of standing and ripeness “ ‘originate’ from the same Article III
limitation.” Susan B. Anthony List v. Driehaus, 134 S. Ct. 2334, 2341 n.5 (2014).
“Much as standing doctrine seeks to keep federal courts out of disputes involving
conjectural or hypothetical injuries, the Supreme Court has reinforced that ripeness
doctrine seeks to prevent the adjudication of claims relating to ‘contingent future
events that may not occur as anticipated, or indeed may not occur at all.’ ” Reddy, 845
F.3d at 500 (quoting Texas v. United States, 523 U.S. 296, 300 (1998)). In many cases,
including this one, the Article III standing and ripeness problems “boil down to the
same question.” See Susan B. Anthony List, 134 S. Ct. at 2341 n.5 (quoting
MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 128 n.8 (2007)).
An injury “sufficient to satisfy Article III must be ‘concrete and particularized’
and ‘actual or imminent, not ‘conjectural or hypothetical.’ ” Susan B. Anthony List,
134 S. Ct. at 2341 (quoting Lujan, 504 U.S. at 560). Within this framework, a plaintiff
“need not actually violate the statute or suffer the prescribed penalty in order to
establish an injury in fact.” Ramirez, 438 F.3d at 98 (citing Steffel v. Thompson, 415
U.S. 452, 459 (1974)). “An allegation of future injury may suffice if the threatened
injury is ‘certainly impending,’ or there is a ‘substantial risk that the harm will
occur.’ ” Susan B. Anthony List, 134 S. Ct. at 2342 (quoting Clapper v. Amnesty Int’l
USA, 568 U.S. 398, 410 (2013)).
Although the parties cite no cases addressing standing in the context of a
Fourth Amendment facial challenge,3 there have been some important recent

The parties cite primarily to First Amendment cases. These cases, however, operate under a
distinct standard of review. See, e.g., Osediacz v. City of Cranston, 414 F.3d 136, 140 (1st Cir. 2005)
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developments in this area of the law. In City of Los Angeles v. Patel, 135 S. Ct. 2443
(2015), the Supreme Court put to rest the idea that facial challenges based on the
Fourth Amendment were “categorically barred or especially disfavored.” Id. at 2449.
Patel involved a Los Angeles municipal code provision which allowed police to inspect
hotel registry information. Failure to make the records available was punishable as
a criminal misdemeanor and could subject the hotelier to immediate arrest. Id. at
2452. The Court found that the plaintiffs, a group of motel operators and a lodging
association, had standing to assert a facial Fourth Amendment challenge to the
provision, but it acknowledged that:
claims for facial relief under the Fourth Amendment are unlikely to
succeed when there is substantial ambiguity as to what conduct a
statute authorizes: Where a statute consists of ‘extraordinarily elastic
categories,’ it may be ‘impossible to tell’ whether and to what extent it
deviates from the requirements of the Fourth Amendment.
Id. at 2450 (citing and clarifying Sibron v. New York, 392 U.S. 40, 60 n.20 (1968)). As
Patel clarified, where a law is susceptible to a wide variety of interpretations; where
it is difficult to tell precisely what conduct a statute authorizes; and where further
factual development would enhance a court’s ability to deal with the legal issues
presented, a facial Fourth Amendment challenge is not ripe. Plains All Am. Pipeline

(“When certain types of facial challenges to statutes, ordinances, regulations, or governmental policies
are premised on First Amendment grounds, they invite a lowering of conventional standing barriers
because the traditional jus tertii ban on litigating the rights of third parties is arguably inapplicable.”);
N.H. Right to Life Pol. Action Comm. v. Gardner, 99 F.3d 8, 13 (1st Cir. 1996) (“an actual injury can
exist when the plaintiff is chilled from exercising her right to free expression or forgoes expression in
order to avoid enforcement consequences”). However, “[t]he solicitude shown to First Amendment
rights is likely inapplicable in the Fourth Amendment context,” in part because “Fourth Amendment
rights are personal rights . . . which may not be vicariously asserted.” Knick v. Twp. of Scott, 862 F.3d
310, 320 n.7 (3d Cir. 2017) (quoting Alderman v. United States, 394 U.S. 165, 174 (1969)).

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L.P. v. Cook, 866 F.3d 534, 543 (3d. Cir. 2017) (citing Patel and Sibron in analyzing a
Delaware escheat law).
DISCUSSION
I analyze the Plaintiffs’ standing on each count, starting with the federal
claims and concluding with the state law claim. See Pagan, 448 F.3d at 26.
I.

Count Two: Constitutional Challenges
The Plaintiffs’ articulated injury under Count Two is that the on-site

inspections provided for in the 2018 Rule would violate their rights under the Fourth
and Fifth Amendments. SAC ¶¶ 5, 46-48. These injuries could occur, they allege,
through the unlawful search of their medical records at the caregivers’ facility,
through an unlawful search of their private homes, and through interviews that take
place during the search. SAC ¶¶ 46, 48. Because no such on-site assessments have
yet taken place, the threshold inquiry for both the standing and ripeness inquiries is
whether the Plaintiffs have adequately alleged an imminent, threatened injury.
An “injury is imminent if it is certainly impending or if there is a substantial
risk that harm will occur.” Reddy, 845 F.3d at 500. In the context of this facial
challenge to the 2018 Rule, I consider whether the injury is certainly impending or
there is a substantial risk that such a search or interrogation would occur if the
Department attempts to conduct an on-site assessment under Section 10. Because
there are numerous ambiguities within the 2018 Rule, it is difficult, if not impossible,
to tell whether any such attempt would result in conduct that violates the Fourth or
Fifth Amendment.
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First, as the State points out, the Department would have to decide to seek an
on-site assessment. Given that there are two inspectors and approximately 55,000
qualifying patients and caregivers, the likelihood of these Plaintiffs being subjected
to an on-site assessment is limited.4 While it is possible that the State would beef up
its enforcement branch and hire additional inspectors, at present the likelihood of an
on-site assessment is quite low.
Second, even if state inspectors decide to conduct an on-site assessment, it is
apparent from Section 10 that the caregivers and patients can refuse entry. Section
10’s language that the Department will show proof of identity when requesting entry
implies that inspectors cannot insist upon entry. 2018 Rule § 10(B)(4). The letter sent
by the Department to Jane and John Doe reinforces this idea, stating that “the
Department may request permission to inspect the premises” and suggesting that a
patient could refuse entry and ask the officials to seek an administrative warrant.
Olsen Decl. Ex. A-4.
The Plaintiffs argue that if they refuse entry they will be expelled from the
protection of the medical marijuana program. Patients will lose their right to use
marijuana as medication, and caregivers will lose their livelihood. But these
predictions rest on assumptions. Section 10’s provision dealing with refusal of entry
contemplates that the Department will consider a refusal to allow entry a “failure to

The chances of Jane Doe and John Doe is even further attenuated because they have not
registered with the State, and their actual identities are unknown to the State. In their case, the
Department would first have to learn their identities (and home addresses), during an on-site
assessment of their caregiver and then decide to do an on-site assessment at their homes.
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comply” with 2018 Rule. 2018 Rule § 10(B)(7). But what the Department will
ultimately do with such a failure to comply is unclear. There are no criminal penalties
attached to such a refusal, as was the case in Patel,5 and the Department, as
discussed above, has considerable discretion in choosing remedial action; in addition
to revocation, remedial options include directed corrective action, suspension, and
civil penalties. 2018 Rule § (10)(A)(4). Section 10’s remedial actions themselves are
ambiguous. “Directed corrective action,” for example, is an undefined term. None of
the remedial options available to the Department has been tested in the state courts.
2018 Rule § (10)(A)(4). And while the revocation of a registry identification card is
possible, there are due process protections which attach to such a revocation,
including written notice and a right to appeal. See 2018 Rule §§ 10(H), (I); Toilet
Goods Ass’n, Inc. v. Gardner, 387 U.S. 158 (1967) (facial challenge of FDA regulation
that provided for suspension of certification of entities that refused FDA inspections
was not ripe because judicial appraisal of the regulation would stand on surer footing
in the context of a specific application, such as an administrative hearing contesting
any such suspension).
The 2018 Rule is susceptible to a wide variety of interpretations, and there has
been no development of the “potential intersections” between the 2018 Rule and the

The Plaintiffs assert that the inspectors may refer caregivers or patients who refuse entry to
law enforcement. 2018 Rule § 10(B)(7); Olsen Decl. Ex. A-4. This is a distinguishable risk from the
authorization to arrest. Anything can be referred to law enforcement, and nothing in the 2018 Rule
changes the constitutional constraints on law enforcement’s response.
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Fourth Amendment. Patel, 135 S. Ct. at 2450. For the same reasons, the Fifth
Amendment injury claim is not adequately developed.
Since it is impossible to know how the Department will implement the 2018
Rule and whether the Department will deviate from the requirements of the
Constitution,6 I find that the Plaintiffs have failed to establish an imminent
threatened injury. Accordingly, I conclude that the Plaintiffs’ constitutional
allegations are not sufficient to establish standing, and, alternatively, the case is not
ripe for adjudication. See Reddy, 845 F.3d at 500.
II.

Count Three: HIPAA
In Count Three, Olsen and Shaw allege that they are medical providers subject

to HIPAA’s Privacy Rule, which prohibits them from disclosing medical information
about their medical marijuana patients. SAC ¶¶ 27, 69. Plaintiffs contend that
HIPAA preempts Section 10’s requirement that caregivers disclose to Department
agents any patient information. SAC ¶¶ 70-72. The Plaintiffs seek a declaratory
judgment under Count Three that they are not bound by Section 10 of the 2018 Rule
to disclose the identity of their qualifying patients. SAC ¶¶ 71, 75. Assuming, without
deciding, that the Plaintiffs have sufficiently demonstrated that they have standing
to raise this claim, it is easily disposed of on the merits.

Here, it is unclear whether the 2018 Rule actually even authorizes unreasonable searches
under the Fourth Amendment. As to the caregivers, the administrative search doctrine will probably
supply the governing Fourth Amendment principles and limitations on State authority. Although the
Department’s authority to enter patients’ homes is more constitutionally suspect, if the 2018 Rule is
interpreted to require consent, it may withstand Fourth Amendment scrutiny. If the Plaintiffs can
refuse entry for the purpose of an on-site inspection, it likewise will be difficult to establish custody as
a basis for a Fifth Amendment violation.
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“One of Congress’s objectives in enacting HIPAA was to address concerns about
the confidentiality of patients’ individually identifiable health information.” OPIS
Mgmt. Res., LLC v. Sec’y, Fla. Agency for Health Care Admin., 713 F.3d 1291, 1294
(11th Cir. 2013). To that end, the Department of Health and Human Services
(“DHHS”) was tasked with promulgating privacy regulations. Id. at 1295. In fulling
that obligation, DHHS promulgated the Privacy Rule which prohibits covered
entities7 from “us[ing] or disclos[ing] protected health information” without valid
authorization. 45 C.F.R. §§ 164.502(a), 164.508(a)(1).
As the Defendant points out, there are exceptions to the Privacy Rule that
allow a covered entity to use or disclose protected health information without
authorization of the patient. The Defendant contends that the exception for health
oversight activities applies here. That exception provides:
(d) Standard: Uses and disclosures for health oversight activities.
(1) Permitted disclosures. A covered entity may disclose protected
health information to a health oversight agency for oversight activities
authorized by law, including audits; civil, administrative, or criminal
investigations; inspections; licensure or disciplinary actions; civil
administrative, or criminal proceedings or actions; or other activities
necessary for appropriate oversight of:
(i) The health care system; . . . [or]
(iii) Entities subject to government regulatory programs for which
health information is necessary for determining compliance with
program standards.
45 C.F.R. § 164.512(d).

I assume, without deciding, that Plaintiffs Olsen and Shaw are “health care providers” and
thus “covered entities” under HIPAA and 45 C.F.R. § 160.103.
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To prevail on their preemption claim, the Plaintiffs would have to establish
that the disclosure requirement of the 2018 Rule was contrary to HIPAA and its
accompanying regulations.8 The Plaintiffs make no attempt to address how the
caregivers’ provision of patient information to the Department pursuant to Section
10 of the 2018 Rule is contrary to HIPAA given the exception found in 45 C.F.R.
§ 164.512(d) for health oversight activities. On its face, the exception in § 164.512(d)
establishes the Department’s authority to request records from caregivers. As such,
the Plaintiffs have failed to assert a viable claim that HIPAA preempts the 2018
Rule.9
Accordingly, I dismiss Count Three for failure to state a claim.
III.

Count One: Maine APA Challenge
Having found a lack of standing under Count Two and a failure to state a claim

under Count Three, I decline to exert supplemental jurisdiction over the state law
claims in Count One.

Congress passed an express preemption provision, providing that HIPAA “shall supersede any
contrary provision of State law . . . .” 42 U.S.C. § 1320d-7(a)(1). A state law is “contrary” to HIPAA if:
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(1) A covered entity . . . would find it impossible to comply with both the State and Federal
requirements; or
(2) The provision of State law stands as an obstacle to the accomplishment and execution of
the full purposes and objectives of [HIPAA].
45 C.F.R. §160.202.
There is also a statutory exception to express preemption for state laws that address controlled
substances. 42 U.S.C.A. § 1320d-7(a)(2)(A). Since I find that the 2018 Rule is not contrary to State law
given the regulatory exception, and since the Defendant did not raise the statutory exception, I do not
address it.
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CONCLUSION
For the reasons stated above, the Court GRANTS the Defendant’s motion to
dismiss and DENIES the Plaintiffs’ motions for a temporary restraining order and
preliminary injunction.

SO ORDERED.
/s/ Nancy Torresen
United States Chief District Judge
Dated this 10th day of July, 2018.

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