Fishman et al v. Daines, M.D. et al
Filing
162
ORDER granting 149 Motion for Partial Summary Judgment. For the reasons set forth herein, the Court grants plaintiffs' motion for partial summary judgment. It is hereby ordered that defendants are permanently enjoined from dismissing adminis trative appeals of defaulting Medicaid appellants who are not given at least ten (10) days to respond to a written notice from defendants inquiring as to whether they would like their hearings rescheduled. SO ORDERED. Ordered by Judge Joseph F. Bianco on 3/29/2017. (Zbrozek, Alex)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
_____________________
No 09-cv-5248 (JFB) (ARL)
_____________________
NEIL FISHMAN, BY HIS LEGAL GUARDIAN, SELMA FISHMAN, AND SURUJ SIRIKESHUN,
INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED,
Plaintiffs,
VERSUS
RICHARD F. DAINES, M.D., AS COMMISSIONER OF THE NEW YORK STATE
DEPARTMENT OF HEALTH, AND JOHN PAOLUCCI, AS DEPUTY COMMISSIONER OF THE
OFFICE OF TEMPORARY AND DISABILITY ASSISTANCE OF THE NEW YORK STATE
DEPARTMENT OF FAMILY ASSISTANCE,
Defendants.
___________________
MEMORANDUM AND ORDER
March 29, 2017
___________________
JOSEPH F. BIANCO, District Judge:
Plaintiffs Neil Fishman, through his
legal guardian (“Fishman”), and Suruj
Sirikeshun (“Sirikeshun”) (collectively,
“plaintiffs”) bring this class action pursuant
to 42 U.S.C. §§ 1983 and 1396a(a)(3)
against the Commissioner of the New York
State Department of Health (“DOH”) 1 and
the Commissioner of the Office of
Temporary and Disability Assistance of the
New York State Department of Family
Assistance
(“OTDA”) 2
(collectively,
“defendants”).
1
The DOH Commissioner was formerly Richard
Daines and is now Howard Zucker.
2
The OTDA Commissioner was formerly John
Paolucci and is now Samuel Roberts.
By Memorandum and Order dated
September 16, 2014, the Court denied
plaintiffs’ motion for a preliminary
injunction requiring defendants to mail a
“default notice” to members of the plaintiff
class before their Medicaid appeals are
deemed abandoned because they missed a
scheduled hearing. The Court found that
plaintiffs failed to make a clear showing that
they were likely to succeed on the merits of
their due process or statutory claims.
Plaintiffs appealed this decision, and by
Summary Order dated October 15, 2015, the
Second Circuit reversed this Court’s denial
of the preliminary injunction and remanded
the case for further proceedings. The Court
subsequently granted plaintiffs’ motion for a
preliminary injunction by Memorandum and
Order dated March 4, 2016, as amended on
March 10, 2016.
The background facts of this case,
including an overview of the Medicaid
system and appeals process, are set forth in
this Court’s opinions (1) denying, in large
part, defendants’ motion to dismiss, see
Fishman v. Daines, 743 F. Supp. 2d 127
(E.D.N.Y. 2010) (“Fishman I”); (2) denying
the preliminary injunction, see Fishman ex
rel. Fishman v. Daines, No. 09-CV-5248
JFB ARL, 2014 WL 4638962, (E.D.N.Y.
Sept. 16, 2014) (“Fishman II”), vacated and
remanded sub nom. Fishman v. Paolucci,
628 F. App’x 797 (2d Cir. 2015); and
(3) granting the preliminary injunction
following remand, see Fishman v. Daines,
164 F. Supp. 3d 409 (E.D.N.Y. 2016)
(“Fishman III”). In addition, the Second
Circuit summarized the contours of the
Medicaid program in its order remanding
this action. See Fishman, 628 F. App’x at
797. Because defendants do not contest
either this Court’s or the Second Circuit’s
analysis of the relevant legal scheme (see
Defs.’ Opp’n Br., ECF No. 159, at 12 n.6),
the Court will briefly outline the law and
regulations at issue.
Thereafter, on April 20, 2016, plaintiffs
moved for partial summary judgment,
seeking to make the preliminary injunction
permanent. Defendants oppose the motion
on the sole ground that plaintiffs lack
standing to bring this action. For the
reasons discussed below, the Court finds
defendants’ position to be without merit,
grants plaintiffs’ motion for partial summary
judgment in its entirety, and hereby orders
that defendants are permanently enjoined
from dismissing administrative appeals of
defaulting Medicaid appellants ho are not
given at least ten (10) days to respond to a
written notice from defendants inquiring as
to whether they would like their hearings
rescheduled.
I. BACKGROUND
A. Facts and Legal Framework
Because defendants’ opposition is
restricted to standing, the Court limits its
analysis to those facts set forth in the
parties’ Rule 56.1 statements, as well as the
parties’ affidavits and exhibits, pertaining to
that issue. 3 Upon consideration of the
motion for partial summary judgment, the
Court will construe the facts in the light
most favorable to defendants as the
nonmoving party, and it will resolve all
factual ambiguities in their favor. See
Capobianco v. New York, 422 F.3d 47, 50
n.1 (2d Cir. 2001).
In short, this case involves the
procedures by which defendants determine
that a Medicaid appeal is abandoned. After
defendants conclude that a claimant is no
longer entitled to Medicaid benefits, they
inform the claimant by letter and advise him
that he may request a fair hearing. See
Fishman II, 2014 WL 4638962, at *1-2. If
the request is timely made, the claimant may
continue to receive “aid-continuing”
Medicaid coverage pending the outcome of
the hearing, and defendants send two
additional letters: first, an acknowledgement
that a fair hearing has been requested; and
second, a notice that the fair hearing has
been scheduled, which includes instructions
for requesting adjournments. Id.
3
Defendants’ 56.1 Statement (“Defs.’ 56.1,” ECF
No. 159-1) responds to only of one of the 82 facts in
plaintiffs’ 56.1 Statement (“Pls.’ 56.1,” ECF No.
149-1). Moreover, defendants have not submitted
any evidence to contradict the remaining facts.
Consequently, the Court deems defendants to have
admitted the remaining facts pursuant to Local Rule
56.1(c). See, e.g., Jessamy v. City of New Rochelle,
292 F. Supp. 2d 498, 504 (S.D.N.Y. 2003).
2
If a claimant does not attend his fair
hearing, whether because he did not receive
a notice or for any other reason, he is
considered to have defaulted his hearing,
and risks having his appeal deemed
abandoned. See 18 N.Y.C.R.R. § 3585.5(a). It is possible to restore a defaulted
hearing to the calendar, but the timing of the
request to do so affects the continuing
provision of Medicaid coverage. See id.
§ 358-5.5(c). Plaintiffs contend that many
class members lost aid-continuing coverage,
at least temporarily, because they did not
realize that they missed their fair hearing.
Fishman II, 2014 WL 4638962, at *2. The
default notice requested by plaintiffs, and
temporarily put in place by the Court when
it granted the preliminary injunction, would
inquire as to whether the defaulting
Medicaid appellant wanted his or her
hearing rescheduled and would give the
appellant at least ten (10) days to respond to
the notice before dismissal of the
administrative appeal. Id.; see also Fishman
III, 164 F. Supp. 3d at 418.
¶ 1.)
The stipulation also required
defendants to begin issuing letters to
prospective class members who defaulted
their fair hearings. (Id. ¶ 3(b).) The letters
asked class members if their hearing request
was abandoned, and advised them that if
they intended to reschedule their hearing,
they must provide good cause for having
defaulted. (Id.) The letter also required the
class members to respond within ten (10)
days of the letter’s mailing date, or else their
hearing request would be deemed
abandoned. (Id.) The letters were issued for
approximately two years, between the date
the Court so-ordered the stipulation on April
6, 2011, and the date it was vacated on
September 16, 2013.
The stipulation also included a provision
exempting prospective class members from
the requirements of 18 N.Y.C.R.R. § 3585.5. (Id. ¶ 3(f).) At that time, Section 3585.5 required defaulting Medicaid appellants
to request that their hearing be rescheduled
within 15 days of default, and to show good
cause, or to establish within 45 days that
they had not received the initial notice of the
hearing. Fishman II, 2014 WL 4638962, at
*3. Under the terms of the stipulation, the
class members were not bound by the 15and 45-day timelines, but instead by the
single timeline of ten days from the mailing
date of the default notice. Section 358-5.5
did not, and still does not, address the
issuance of a written default notice.
B. Procedural Background
After the Court issued its opinion on the
motion to dismiss in 2010, see Fishman I,
743 F. Supp. 2d at 127, the parties reached a
comprehensive stipulation, which the Court
ordered effective on April 6, 2011 (ECF No.
61). Among other things, the stipulation
certified this case as a class action, on behalf
of “[a]ll past, present, and future applicants
and recipients of Medical Assistance . . . in
New York State who: (a) requested or will
request an administrative fair hearing . . .
(b) failed or will fail to appear in-person . . .
and (c) suffered or will suffer dismissal of
their
administrative
appeal
without
defendants’ prior written inquiry.” 4 (Id.
The 15- and 45-day requirements were
eliminated when Section 358-5.5 was
amended, effective October 23, 2012.
Medicaid appellants now have one year to
request that their hearings be rescheduled,
but are also subject to a new timeline. They
must request that their hearing be
4
Although this stipulation was later vacated (ECF
No. 101), defendants subsequently stipulated to the
certification of the same class, both by letter dated
September 18, 2013 (ECF No. 102), and by a jointlysigned stipulation so-ordered by the Court on March
10, 2014 (ECF No. 123).
3
October 15, 2015, the Second Circuit
reversed this Court’s denial of the
preliminary injunction and remanded the
case for further proceedings consistent with
its Summary Order. See Fishman, 628 F.
App’x at 797. Specifically, the Second
Circuit found that this Court “did not
separately conduct an analysis of 42 U.S.C.
§ 1396a(a)(3)” and remanded the motion “to
provide [this Court] with the opportunity to
do so in the first instance.” Id. at 802. The
Second Circuit directed that the Court
“should ask whether plaintiffs are likely to
succeed on their claim that New York
violates their § 1396a(a)(3) fair hearing right
as defined further by any relevant federal
regulations, including 42 C.F.R. § 431.223.”
Id.
rescheduled within 60 days of the date of
default, or they will be unable to recover
retroactive benefits for any period of lost
coverage after they defaulted.
See 18
N.Y.C.R.R. § 358-5.5(c)(1). If their request
to reschedule the hearing is made 60 days or
more after the default, they will only receive
medical coverage prospectively, from the
date of their request. Id. § 358-5.5(c)(2).
After Section 358-5.5 was amended,
plaintiffs moved to alter the stipulation so
that the plaintiff class could benefit from the
longer one-year timeline, and from the
provision addressing retroactive and
prospective coverage, which was not
addressed by the terms of the stipulation.
(ECF No. 91.) Defendants opposed the
motion. Ultimately, the Court vacated the
stipulation, pursuant to Fed. R. Civ. P.
60(b)(5), concluding that it was not
equitable to bind defendants to both the
stipulation and the amended regulation at the
same time, because defendants had
negotiated the stipulation with the former
regulation in mind. (See ECF No. 101.) If
defendants were required to extend the new
regulation to the prospective class members,
the Court held that they should receive the
opportunity to litigate the necessity of a
written default notice in light of the new
regulation. (Id.)
Following remand, this Court granted
the preliminary injunction on March 4,
2016, as amended on March 10, 2016, after
finding that plaintiffs had
made a clear showing that they are
likely to succeed on the merits of
their statutory claim. As previously
held by this Court and confirmed by
the Second Circuit, 42 U.S.C.
§ 1396a(a)(3) creates a right to a fair
hearing before Medicaid benefits are
revoked, which is enforceable
through [42 U.S.C.] § 1983. 42
C.F.R. § 431.223’s requirement that
a Medicaid fair hearing request not
be dismissed without good cause
may be reasonably understood to be
part of the right to an opportunity for
a Medicaid fair hearing.
On September 16, 2014, the Court
denied plaintiffs’ motion for a preliminary
injunction, which would have prohibited
defendants
from
dismissing
the
administrative appeals of defaulting
Medicaid appellants who were not given at
least ten days to respond to a post-hearing
notice. See Fishman II, 2014 WL 4638962,
at *11. The Court concluded that plaintiffs
failed to make a clear showing that they
were likely to succeed on their due process
or statutory claims. Id. Plaintiffs appealed
that decision, and by Summary Order dated
Fishman III, 164 F. Supp. 3d at 411. In
addition, the Court held that “the State
Medicaid Manual—which provides in a
directive that participating states must
inquire by written notice as to whether
Medicaid appellants want their defaulted
4
hearings rescheduled and may only dismiss
them if no reply is received—is entitled to
Skidmore deference.” Id. In sum, the Court
found that plaintiffs were likely to succeed
on the merits of their claims because 42
U.S.C. 1396a(a)(3), “as informed by the
relevant federal regulation and agency
interpretation of the regulation (through the
State Medicaid Manual),” requires “that the
State, before dismissing an appeal as
abandoned when the Medicaid appellant
failed to appear at the hearing, must
ascertain through a post-default notice
whether the appellant wishes any further
action on his request for a hearing.” Id.
Accordingly, the Court preliminarily
enjoined defendants “from dismissing
administrative appeals of defaulting
Medicaid appellants who are not given at
least 10 days to respond to a written notice
from defendants inquiring whether they
would like their hearings rescheduled . . . .”
Id.
movant is entitled to judgment as a matter of
law.” Fed. R. Civ. P. 56(a); see also
Gonzalez v. City of Schenectady, 728 F.3d
149, 154 (2d Cir. 2013). The moving party
bears the burden of showing that it is
entitled to summary judgment.
See
Huminski v. Corsones, 396 F.3d 53, 69 (2d
Cir. 2005). Rule 56(c)(1) provides that a
party asserting that a fact cannot be
or is genuinely disputed must
support the assertion by: (A) citing to
particular parts of materials in the
record,
including
depositions,
documents, electronically stored
information,
affidavits
or
declarations, stipulations (including
those made for purposes of the
motion
only),
admissions,
interrogatory answers, or other
materials; or (B) showing that the
materials cited do not establish the
absence or presence of a genuine
dispute, or that an adverse party
cannot produce admissible evidence
to support the fact.
Thereafter, on April 20, 2016, plaintiffs
moved for partial summary judgment,
seeking to make the preliminary injunction
permanent. (ECF No. 149.) The parties
then requested multiple extensions of the
briefing schedule due to settlement
discussions, and defendants eventually
submitted their opposition on March 3,
2017. (ECF No. 159.) Plaintiff replied on
March 24, 2017 (ECF No. 160), and the
Court held oral argument on March 27, 2017
(ECF No. 161).
The Court has fully
considered the parties’ submissions.
Fed. R. Civ. P. 56(c)(1). The court “‘is not
to weigh the evidence but is instead required
to view the evidence in the light most
favorable to the party opposing summary
judgment, to draw all reasonable inferences
in favor of that party, and to eschew
credibility assessments.’” Amnesty Am. v.
Town of W. Hartford, 361 F.3d 113, 122 (2d
Cir. 2004) (quoting Weyant v. Okst, 101
F.3d 845, 854 (2d Cir. 1996)); see also
Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 248 (1986) (summary judgment is
unwarranted if “the evidence is such that a
reasonable jury could return a verdict for the
nonmoving party”).
II. STANDARD OF REVIEW
The standard for summary judgment is
well-settled. Pursuant to Federal Rule of
Civil Procedure 56(a), a court may grant a
motion for summary judgment only if “the
movant shows that there is no genuine
dispute as to any material fact and the
Once the moving party has met its
burden, the opposing party “‘must do more
than simply show that there is some
5
metaphysical doubt as to the material
facts . . . . [T]he nonmoving party must
come forward with specific facts showing
that there is a genuine issue for trial.’”
Caldarola v. Calabrese, 298 F.3d 156, 160
(2d Cir. 2002) (alteration and emphasis in
original) (quoting Matsushita Elec. Indus.
Co. v. Zenith Radio Corp., 475 U.S. 574,
586-87 (1986)). As the Supreme Court
stated in Anderson, “[i]f the evidence is
merely colorable, or is not significantly
probative, summary judgment may be
granted.” 477 U.S. at 249-50 (citations
omitted). Indeed, “the mere existence of
some alleged factual dispute between the
parties alone will not defeat an otherwise
properly supported motion for summary
judgment.” Id. at 247-48 (emphasis in
original). Thus, the nonmoving party may
not rest upon mere conclusory allegations or
denials but must set forth “‘concrete
particulars’” showing that a trial is needed.
R.G. Grp., Inc. v. Horn & Hardart Co., 751
F.2d 69, 77 (2d Cir. 1984) (quoting SEC v.
Research Automation Corp., 585 F.2d 31, 33
(2d Cir. 1978)).
Accordingly, it is
insufficient for a party opposing summary
judgment “‘merely to assert a conclusion
without supplying supporting arguments or
facts.’” BellSouth Telecomms., Inc. v. W.R.
Grace & Co.-Conn., 77 F.3d 603, 615 (2d
Cir. 1996) (quoting Research Automation
Corp., 585 F.2d at 33).
§ 1396a(a)(3).” (Pls.’ Br., ECF No. 149-3,
at 2.)
In response, defendants do not contest
this premise; instead, defendants state that
they “recognize those decisions issued by
the Second Circuit and [this] Court
concerning the private right of action and
deference to the Medicaid Manual issues,
and therefore do not raise them in this
context,” although they “respectfully reserve
their rights with regard thereto in the future,
inasmuch as the counters of any right to
post-default notice was not clearly
established at least until the Second Circuit’s
decision last year.” (Defs.’ Opp’n Br. at 12
n.6.) Defendants’ opposition is limited to
their contention that “plaintiffs have failed
to sustain the basic burden of proving they
have standing in this matter.” (Id. at 12.)
Specifically, they argue that (1) neither
Fishman nor Sirikeshun have “submitted
any proof that they suffered an injury-in-fact
as a result of not receiving a third notice
from OTDA, post-default” (id. at 16); and
(2) plaintiffs have “failed to satisfy the
requirement that any purported injury must
have been as a result of the defendants’ acts”
(id. at 17).
For the reasons that follow, the Court
disagrees with defendants and grants
plaintiffs’ motion for partial summary
judgment in its entirety.
III. DISCUSSION
A. Applicable Law
Plaintiffs argue that a permanent
injunction is warranted because “[i]t is
uncontested that defendants do not provide
post-default notice. Since 42 U.S.C.
§ 1396a(a)(3) creates an enforceable federal
right to such notice and defendants do not
provide it, plaintiffs submit that they are
entitled to judgment as a matter of law on
their federal statutory claim under 42 U.S.C.
“The jurisdiction of federal courts is
defined and limited by Article III of the
Constitution[, and] the judicial power of
federal courts is constitutionally restricted to
‘cases’ and ‘controversies.’”
Flast v.
Cohen, 392 U.S. 83, 94 (1968). “This
limitation is effectuated through the
requirement of standing.” Cooper v. U.S.
Postal Serv., 577 F.3d 479, 489 (2d Cir.
6
question.” Strubel v. Comenity Bank, 842
F.3d 181, 188 (2d Cir. 2016) (citing Warth
v. Seldin, 422 U.S. 490, 500 (1975)
(recognizing that injury required by Article
III may be based on “statutes creating legal
rights”), and Lujan, 504 U.S. at 578
(recognizing Congress’s authority to
“elevat[e] to the status of legally cognizable
injuries concrete, de facto injuries that were
previously inadequate in law”)). However,
even where Congress has codified a
statutory right, a plaintiff must still allege
that she has suffered a concrete and
particularized injury connected to that
interest. Id.; see also Spokeo, Inc. v. Robins,
136 S. Ct. 1540, 1547-48 (2016). In other
words, the creation of a statutory interest
does not vitiate Article III’s standing
requirements.
2009) (citing Valley Forge Christian Coll. v.
Ams. United for Separation of Church &
State, Inc., 454 U.S. 464, 471-72 (1982)).
“It is axiomatic that there are three Article
III standing requirements: (1) the plaintiff
must have suffered an injury-in-fact;
(2) there must be a causal connection
between the injury and the conduct at issue;
and (3) the injury must be likely to be
redressed by a favorable decision.” Id.
(brackets and citation omitted); see also
Lamar Adver. of Penn, LLC v. Town of
Orchard Park, N.Y., 356 F.3d 365, 373 (2d
Cir. 2004) (“To meet Article III’s
constitutional requirements for standing, a
plaintiff must allege an actual or threatened
injury to himself that is fairly traceable to
the allegedly unlawful conduct of the
defendant.” (citation omitted)). Courts must
evaluate a plaintiff’s standing “as of the
outset of the litigation.” Mhany Mgmt., Inc.
v. Cnty. of Nassau, 819 F.3d 581, 600 (2d
Cir. 2016); see also Friends of the Earth,
Inc. v. Laidlaw Envtl. Servs. (TOC), Inc.,
528 U.S. 167, 180 (2000).
Nevertheless, in “cases where a plaintiff
sues to enforce a substantive legal right
conferred by statute, she has standing to
pursue that claim . . . because the
infringement of that right constitutes, in and
of itself, a concrete injury.” Bautz v. ARS
Nat’l Servs., Inc., --- F. Supp. 3d ---, 2016
WL 7422301, at *8 (E.D.N.Y. Dec. 23,
2016); see also Spokeo, 136 S. Ct. at 1553
(Thomas, J., concurring) (“Congress can
create new private rights and authorize
private plaintiffs to sue based simply on the
violation of those private rights. . . . A
plaintiff seeking to vindicate a statutorily
created private right need not allege actual
harm beyond the invasion of that private
right.” (citing Havens Realty Corp. v.
Coleman, 455 U.S. 363, 373-74 (1982)
(recognizing standing for a violation of the
Fair Housing Act), and Tennessee Elec.
Power Co. v. TVA, 306 U.S. 118, 137-38
(1939) (recognizing that standing can exist
where “the right invaded is a legal right,—
one of property, one arising out of contract,
one protected against tortious invasion, or
Article III’s injury-in-fact component
requires that a plaintiff’s alleged injury
“must be ‘concrete and particularized’ as
well as ‘actual or imminent, not conjectural
or hypothetical.’” Baur v. Veneman, 352
F.3d 625, 632 (2d Cir. 2003) (quoting Lujan
v. Defenders of Wildlife, 504 U.S. 555, 560
(1992)). Further, the alleged injury must
“affect[] the plaintiff in a personal and
individual way to confirm that the plaintiff
has a personal stake in the controversy and
avoid having the federal courts serve as
merely publicly funded forums for the
ventilation of public grievances or
the
refinement
of
jurisprudential
understanding.” Id. (citations omitted).
“Congress’s authority to create new
legal interests by statute, the invasion of
which can support standing, is beyond
7
one founded on a statute which confers a
privilege”))).
(Defs.’ Opp’n Br. at 16-17.)
disagrees.
“The traceability requirement for Article
III standing means that the plaintiff must
demonstrate a causal nexus between the
defendant’s conduct and the injury,” and
such a relationship can either be direct or
indirect. Rothstein v. UBS AG, 708 F.3d 82,
91 (2d Cir. 2013). Finally, the Second
Circuit has said that a “plaintiff’s burden to
demonstrate standing increases over the
course of litigation.” Cacchillo v. Insmed,
Inc., 638 F.3d 401, 404 (2d Cir. 2011)
(citing Lujan, 504 U.S. at 561). “When a
preliminary injunction is sought, a plaintiff’s
burden to demonstrate standing ‘will
normally be no less than that required on a
motion for summary judgment.’”
Id.
(quoting Lujan v. Nat’l Wildlife Fed’n
(Lujan I), 497 U.S. 871, 907 n.8 (1990)).
“Accordingly, to establish standing for a
preliminary injunction, a plaintiff cannot
‘rest on such mere allegations, [as would be
appropriate at the pleading stage] but must
set forth by affidavit or other evidence
specific facts, which for purposes of the
summary judgment motion will be taken to
be true.’” Id. (alteration in original) (quoting
Lujan, 504 U.S. at 561).
As noted, the evidentiary standards for
establishing standing on a motion for a
preliminary injunction and at the summary
judgment stage are identical. See Cacchillo,
638 F.3d at 404. Although this Court did
not specifically address standing in its
opinions concerning plaintiffs’ request for a
preliminary injunction because defendants
did not raise that issue, it did hold—both in
its decision denying a preliminary injunction
and its decision granting a preliminary
injunction following remand—that plaintiffs
had demonstrated irreparable injury because
“[c]ourts have repeatedly held that the
wrongful denial of Medicaid benefits, in
situations analogous to this case, is the type
of non-monetary, imminent harm that is
properly characterized as irreparable.”
Fishman II, 2014 WL 4638962, at *6
(citing, inter alia, Strouchler v. Shah, 891 F.
Supp. 2d 504, 520 (S.D.N.Y. 2012) (noting,
in Medicaid case, “Second Circuit and outof-circuit appellate law holding that the
mere threat of a loss of medical care, even if
never realized, constitutes irreparable
harm”), and Mitchell v. Cuomo, 748 F.2d
804, 806 (2d Cir. 1984) (“When an alleged
deprivation of a constitutional right is
involved, most courts hold that no further
showing
of
irreparable
injury
is
necessary.”)); see also Fishman III, 164 F.
Supp. 3d at 413-14. Moreover, the Second
Circuit affirmed that finding on appeal,
holding that this Court “did not abuse its
discretion in finding irreparable harm”
because “if the state wrongfully terminates
Medicaid benefits because a beneficiary
fails to appear, ‘his situation becomes
immediately desperate.’” Fishman, 628 F.
App’x at 800-01 (quoting Goldberg v. Kelly,
397 U.S. 254, 264 (1970)) (citing Blum v.
Caldwell, 446 U.S. 1311, 1314 (1980) (order
denying stay of mandate) (“[T]he very
B. Analysis
After eight years of litigation, including
an interlocutory appeal and a class
certification to which both parties consented
(twice), defendants now argue that plaintiffs
never had standing to pursue this action in
the first place. With respect to the injury-infact component, they assert that neither
Fishman
nor
Sirikeshun
suffered
demonstrable economic injuries because
they submitted no proof that they were in
fact billed for medical expenses following
abandonment of their Medicaid appeals.
8
The Court
Further, to the extent that defendants
argue that this injury was not sufficiently
particularized, that position is not borne out
by the law or the facts. “For an injury to be
particularized, it must affect the plaintiff in a
personal and individual way.” Spokeo, 136
S. Ct. at 1548. In other words, a plaintiff
must “sustain a grievance distinct from the
body politic, not a grievance unique from
that of any identifiable group of persons.”
Strubel, 842 F.3d at 191 n.10 (citing Sierra
Club v. Morton, 405 U.S. 727, 734-40
(1972)). First, plaintiffs sued to enforce
their own right to a pre-abandonment notice
of default under the apposite statutes and
regulations; they did not pursue their claims
solely on behalf of the general public.
survival of these individuals and those class
members . . . is threatened by a denial of
medical assistance benefits. . . .”)). Thus, a
“lack of medical services is exactly the sort
of irreparable harm that preliminary
injunctions are designed to address.” Id. at
801.
This determination establishes that
plaintiffs had standing at the outset of this
litigation to challenge the denial of Medicaid
benefits and the coincident violation of their
Due Process rights because deeming a
Medicaid appeal abandoned without
providing prior notice of default would
irreparably injure the “survival of these
[plaintiffs] and those class members” that
they represent. Blum, 446 U.S. at 1314. In
other words, this Court and the Second
Circuit found that plaintiffs faced an “actual
or imminent” injury that was “not
conjectural or hypothetical,” Baur, 352 F.3d
at 632, based on the violation of a
“substantive legal right conferred by
statute,” Bautz, 2016 WL 7422301, at *8, as
well as plaintiffs’ constitutional rights. The
invasion of such interests is sufficient to
establish concrete injury for standing
purposes. See Spokeo, 136 S. Ct. at 1553;
Strubel, 842 F.3d at 188; Baur, 352 F.3d at
635 (holding that the plaintiff had standing
to sue under a statute because “there [was] a
tight connection between the type of injury
which Baur alleges and the fundamental
goals of the statutes which he sues under—
reinforcing Baur’s claim of cognizable
injury” (citing, inter alia, Friends of the
Earth, Inc. v. Gaston Copper Recycling,
Corp., 204 F.3d 149, 156 (4th Cir. 2000) (en
banc) (affirming plaintiff’s standing to sue
where the plaintiff “alleged precisely [those]
types of injuries that Congress intended to
prevent by enacting the Clean Water
Act”))).
Second, it “has long been clear that
economic injury is not the only kind of
injury that can support a plaintiff's
standing,” Vill. of Arlington Heights v.
Metro. Hous. Dev. Corp., 429 U.S. 252,
262-63 (1977) (finding injury-in-fact based
on alleged equal protection violations), and
that “[i]mpairments to constitutional rights
are generally deemed adequate to support a
finding of ‘injury’ for purposes of standing,”
Doe v. Sch. Bd. of Ouachita Parish, 274
F.3d 289, 292 (5th Cir. 2001), accord
Council of Ins. Agents & Brokers v.
Molasky-Arman, 522 F.3d 925, 931 (9th Cir.
2008). Thus, plaintiffs need not, as a matter
of law, provide proof of individual
economic harm to have standing to vindicate
their constitutional rights. Regardless, there
is no record support for defendants’
contention that plaintiffs did not suffer
financial injury as a result of the challenged
notice procedures. In support of their 2010
motion for class certification, plaintiffs
submitted a statement showing that Fishman
had accrued $140,153.08 in debt from 2005
through 2009 for Medicaid-related services
due to termination of his coverage following
abandonment of his Medicaid appeal. (ECF
9
No. 42-3 at A342; see also Reply Decl. of
Peter Volmer in Supp. of Mot. for Partial
Summ. J. (“Volmer Reply Decl.”), ECF No.
160-1, Ex. 1.) More to the point, Fishman’s
Medicaid coverage was terminated in 2005
and not reinstated after his Medicaid appeal
was deemed abandoned. See Fishman I,
743 F. Supp. 2d at 135. Likewise, as the
Court noted in its decision on defendants’
motion to dismiss, Sirikeshun “is liable for
his own medical expenses between May 11,
2007—the date his benefits were
terminated—and March 31, 2008—the day
before his coverage was reinstated,” id., and
plaintiffs provided proof of those expenses
with their reply brief in support of the
instant motion (see Volmer Reply Decl., Ex.
3). Thus, the record shows that both
plaintiffs had outstanding financial liabilities
based on the abandonment of their Medicaid
appeals when they filed suit on December 1,
2009, and as the Second Circuit affirmed on
the interlocutory appeal, such injury
establishes imminent harm, see Fishman,
628 F. App’x at 800, which, in this case,
affected plaintiffs “in a personal and
individual way,” Spokeo, 136 S. Ct. at
1548. 5
Finally, defendants’ claim that plaintiffs
have failed to establish causation because
defendants have failed to establish mootness for two
reasons.
First, the “voluntary cessation doctrine” is an
exception to mootness, and “[u]nder this principle, ‘a
defendant’s voluntary cessation of a challenged
practice does not deprive a federal court of its power
to determine the legality of the practice.’” Id.
(quoting City of Mesquite v. Aladdin’s Castle, Inc.,
455 U.S. 283, 289 (1982)). To overcome this
exception, defendants must demonstrate that “(1)
there is no reasonable expectation that the alleged
violation will recur and (2) interim relief or events
have completely and irrevocably eradicated the
effects of the alleged violation.” Id. They cannot do
so in this case because 18 N.Y.C.R.R. § 358-5.5 still
does not require defendants to provide Medicaid
applicants with notice of default prior to deeming
their Medicaid appeals abandoned, and as a result,
defendants have not carried their “formidable burden
of showing that it is absolutely clear the allegedly
wrongful behavior could not reasonably be expected
to recur.” Id. at 603-04 (quoting Laidlaw, 528 U.S. at
190). In other words, should the Court dismiss this
action as moot, there is nothing that prevents
defendants from again violating plaintiffs’ and class
members’ enforceable rights under 42 U.S.C.
§§ 1983 and 1396a(a)(3).
Second, the Court has already certified this case as a
class action, and accordingly, the class members
retain a live legal interest in the outcome of this
litigation even if there is no longer a cognizable case
or controversy between defendants and Fishman and
Sirikeshun. See Sosna v. Iowa, 419 U.S. 393, 399
(1975) (holding that case was not moot because
“appellant brought this suit as a class action and
sought to litigate the constitutionality of [a state
statute] in a representative capacity,” and therefore,
“the class of unnamed persons described in the
certification acquired a legal status separate from the
interest asserted by appellant”); Milanes v.
Napolitano, 354 F. App’x 573, 575 (2d Cir. 2009)
(“When a class action has been certified, mootness of
the dispute between the named plaintiff and the
defendant does not render other class members’
claims nonjusticiable.”). Thus, even assuming that
Fishman and Sirikeshun’s individual claims are moot,
that does not preclude this Court from granting their
motion for partial summary judgment and making the
preliminary injunction permanent on behalf of the
remaining class members.
5
As noted, standing is measured at the “outset of the
litigation,” Mhany Mgmt., 819 F.3d at 600, whereas
“mootness is ‘standing set in a time frame: The
requisite personal interest that must exist at the
commencement of the litigation (standing) must
continue throughout its existence (mootness),’” id. at
603 (quoting Arizonans for Official English v.
Arizona, 520 U.S. 43, 68 n.22 (1997)). To the extent
that defendants are implicitly arguing that this case is
now moot because there is no proof that plaintiffs
ever paid any of the medical bills for Medicaid
services that they received (see Defs.’ Br. at 16-17),
or because Fishman received partial reimbursement
for his pre-complaint debt subsequent to filing suit
(see Volmer Reply Decl. at ¶ 5, Ex. 1), defendants
carry the burden of proving mootness because ““by
the time mootness is an issue, the case has been
brought and litigated, often (as here) for years. To
abandon the case at an advanced stage may prove
more wasteful than frugal.’” Mhany Mgmt., 819 F.3d
at 603 (quoting Laidlaw, 528 U.S. at 191-92). Here,
10
In sum, plaintiffs had standing at the
outset of this litigation based on
(1) cognizable injury-in-fact due to
impairment of their constitutional and
statutory rights, as well as resulting
economic harm; and (2) a causal nexus
between those injuries and defendants’
conduct.
“the alleged injury—a failure to reopen the
defaulted fair hearings—stemmed not from
the lack of [a default notice], but rather the
named plaintiffs’ own actions or failures to
act” is entirely without merit. (Defs.’ Opp’n
Br. at 17.) “As previously held by this
Court and confirmed by the Second Circuit,
42 U.S.C. § 1396a(a)(3) creates a right to a
fair hearing before Medicaid benefits are
revoked, which is enforceable through [42
U.S.C.] § 1983.” Fishman III, 164 F. Supp.
3d at 411. Based on that statute, relevant
federal regulations, and the State Medicaid
Manual, this Court found in its decision
granting the preliminary injunction that “the
State, before dismissing an appeal as
abandoned when the Medicaid appellant
failed to appear at the hearing, must
ascertain through a post-default notice
whether the appellant wishes any further
action on his request for a hearing.” Id. The
failure to provide such notice—and not the
“failure to reopen the defaulted fair
hearings”—is the injury that plaintiffs seek
to remedy in this action, and there is no
dispute that there is a “a causal nexus
between the defendant[s’] conduct and the
injury” at issue. Rothstein, 708 F.3d at 91.
IV. CONCLUSION
For the foregoing reasons, the Court
grants plaintiffs’ motion for partial summary
judgment.
It is hereby ordered that
defendants are permanently enjoined from
dismissing administrative appeals of
defaulting Medicaid appellants who are not
given at least ten (10) days to respond to a
written notice from defendants inquiring as
to whether they would like their hearings
rescheduled.
SO ORDERED.
______________________
JOSEPH F. BIANCO
United States District Judge
Dated: March 29, 2017
Central Islip, NY
Further, defendants’ efforts to call
attention
to
Sirikeshun’s
apparent
knowledge of the means by which he could
have sought to adjourn his fair hearing and
Fishman’s counsel’s purported failure to
seek an adjournment (Defs.’ Opp’n Br. at
17-18) are irrelevant.
Whether or not
plaintiffs or their legal representatives were
able to seek an adjournment of plaintiffs’
fair hearings does not bear on defendants’
failure to provide plaintiffs with notice of
default prior to deeming their Medicaid
appeals abandoned. That deficiency was
unlawful and “fairly traceable” to
defendants for standing purposes. Rothstein,
708 F.3d at 91.
***
Plaintiffs are represented by Peter Vollmer
of Vollmer & Tanck, Jericho Atrium, 500
North Broadway, Suite 149, Jericho, New
York 11753. Defendants are represented by
Susan M. Connolly,
Kimberly Ann
Kinirons, and Patricia M. Hingerton of the
New York State Office of the Attorney
General, 300 Motor Parkway, Suite 230,
Hauppauge, New York 11788.
11
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