Middlebrooks v. United States of America
Filing
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ORDER denying as moot 8 Motion to Dismiss for Lack of Jurisdiction; MOTION to Dismiss for Failure to State a Claim ; denying 16 Motion to Dismiss for Lack of Jurisdiction. Signed by U.S. District Judge Karen E. Schreier on 3/20/2014. (KC)
UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH DAKOTA
SOUTHERN DIVISION
STEFAN MARK MIDDLEBROOKS,
Plaintiff,
vs.
UNITED STATES OF AMERICA,
Defendant.
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CIV. 13-4033-KES
ORDER DENYING DEFENDANT’S
MOTION TO DISMISS
Plaintiff, Stefan Mark Middlebrooks, seeks review of an agency action
under the Administrative Procedure Act. Defendant, United States of America,
moves the court to dismiss the amended complaint. For the reasons stated
below, the court denies the motion to dismiss.
BACKGROUND
The facts, according to the amended complaint, are as follows:
Middlebrooks was born on October 26, 1993. His father, Gary
Middlebrooks, is a retired member of the South Dakota Air National Guard.
Middlebrooks suffers from a rare genetic condition known as tricho-dentoosseous syndrome (TDO), which affects a person’s hair, teeth, and bones.1
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“[TDO] is an autosomal dominant disorder characterized by abnormal
hair, teeth and bone. The main clinical manifestations of TDO include
taurodontism, enamel hypoplasia, kinky, curly hair at birth and increased
thickness and density of the cranial bones.” Jennifer A. Price, et al.,
Identification of a Mutation in DLX3 Associated with Tricho-Dento-Osseous (TDO)
Syndrome, 7 Oxford Journal of Human Molecular Genetics 563, 563 (1998),
Middlebrooks suffers from taurondontism,2 enamel hypoplasia,3 and a
malformation of his jaw. As a result, Middlebrooks’s medical providers
recommend full mouth crowns to protect his teeth.
The TRICARE program provides certain medical benefits for active duty
uniformed services members, retirees, and their dependents.4 As a result of his
father’s military service, Middlebrooks is eligible for medical benefits through
TRICARE. Middlebrooks sought approval of the recommended dental procedure
from TRICARE, which was denied. Subsequently, Middlebrooks requested
reconsideration, but his benefits were denied again. Middlebrooks again
appealed, and the office of the Assistant Secretary of Defense issued a final
denial. Docket 18-1. Middlebrooks then filed this action. Docket 1. The United
States moved to dismiss the original complaint. Docket 8. Middlebrooks timely
available at http://hmg.oxfordjournals.org/content/7/3/563.full.pdf+html.
2
Taurodontism is “[a] developmental anomaly involving molar teeth in
which the bifurcation or trifurcation of the roots is very near the apex, resulting
in an abnormally large and long pulp chamber with exceedingly short pulp
canals.” Stedman’s Medical Dictionary 1937 (2006).
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Enamel hypoplasia is “a developmental disturbance of teeth
characterized by deficient or defective enamel matrix formation . . . .”
Stedman’s Medical Dictionary 935 (2006).
4
The TRICARE program is a managed health care program formerly
known as the Civilian Health and Medical Program of the Uniformed Services,
or CHAMPUS. TRICARE involves the competitive selection of private
contractors to underwrite the delivery of healthcare services. See Baptist
Physician Hosp. Org., Inc. v. Humana Military Healthcare Servs., Inc., 481 F.3d
337, 340 (6th Cir. 2007).
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filed an amended complaint.5 The United States moved to dismiss the amended
complaint, which is the subject of this motion to dismiss. Docket 12.
LEGAL STANDARD
The motion to dismiss before the court is brought pursuant to Federal
Rule of Civil Procedure 12(b)(1), for lack of subject matter jurisdiction, and Rule
12(b)(6), for failure to state a claim upon which relief can be granted. A party
challenging subject matter jurisdiction under Rule 12(b)(1) must attack either
the facial or factual basis for jurisdiction. See Osborn v. United States, 918 F.2d
724, 729 n.6 (8th Cir. 1990). A facial challenge requires the court to examine
the complaint and determine if the plaintiff has sufficiently alleged a basis for
subject matter jurisdiction, and the nonmoving party receives the same
protections as it would if defending a motion to dismiss under Rule 12(b)(6). Id.
A factual attack challenges the factual basis for subject matter jurisdiction, and
the court considers matters outside the pleadings without giving the nonmoving
party the benefit of the Rule 12(b)(6) safeguards. Id. The party seeking to
establish jurisdiction has the burden of proof that jurisdiction exists. Id. at 730
(quoting Mortensen v. First Fed. Sav. & Loan Ass’n, 549 F.2d 884, 891 (3d Cir.
1977)).
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“It is well-established that an amended complaint supercedes [sic] an
original complaint and renders the original complaint without legal effect.” In re
Atlas Van Lines, Inc., 209 F.3d 1064, 1067 (8th Cir. 2000).
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When reviewing a motion to dismiss under Rule 12(b)(6), the court accepts
as true all factual allegations in the complaint and draws all reasonable
inferences in favor of the nonmoving party. Freitas v. Wells Fargo Home Mortg.,
Inc., 703 F.3d 436, 438 (8th Cir. 2013) (quoting Richter v. Advance Auto Parts,
Inc., 686 F.3d 847, 850 (8th Cir. 2012)). The court may consider the complaint,
some materials that are part of the public record, and materials embraced by
the complaint. Porous Media Corp. v. Pall Corp., 186 F.3d 1077, 1079 (8th Cir.
1999). “To survive a motion to dismiss, a complaint must contain sufficient
factual matter, accepted as true, ‘to state a claim to relief that is plausible on its
face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.” Id.
DISCUSSION
I.
Subject Matter Jurisdiction
A. Money Damages or Equitable Relief
The United States argues that this court does not have subject matter
jurisdiction because this court cannot grant the relief Middlebrooks requests
due to the doctrine of sovereign immunity. Under the doctrine of sovereign
immunity, the United States cannot be sued without its consent. United States v.
Mitchell, 463 U.S. 206, 212 (1983). “When the United States consents to be
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sued, the terms of its wavier of sovereign immunity define the extent of the
court’s jurisdiction.” United States v. Mottaz, 476 U.S. 834, 841 (1986). The
plaintiff has the burden of showing both a waiver of sovereign immunity and a
grant of subject matter jurisdiction. V S Ltd. P’ship v. Dep’t of Hous. & Urban
Dev., 235 F.3d 1109, 1112 (8th Cir. 2000). Two separate waivers of sovereign
immunity are at issue in this case: the Tucker Act, 28 U.S.C. § 1491, and the
Administrative Procedure Act (APA), 5 U.S.C. §§ 701-706.
The APA waives sovereign immunity for actions against the United States
for review of administrative actions that do not seek money damages and
provides for judicial review in the federal district courts. See Suburban Mortg.
Assocs., Inc. v. U.S. Dep’t of Hous. & Urban Dev., 480 F.3d 1116, 1122 (Fed. Cir.
2007). The Tucker Act waives the United States’s sovereign immunity as to
certain suits for money damages, but vests exclusive jurisdiction over all such
suits seeking money damages exceeding $10,0006 in the Court of Federal
Claims. Id. at 1122 n.10 (explaining that the Court of Federal Claims has
exclusive jurisdiction because Congress has not granted the authority to hear
such claims to any other court). The Tucker Act is only a waiver of sovereign
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The Little Tucker Act, 28 U.S.C. § 1346(a), allows federal district courts
to hear claims against the United States for money damages not exceeding
$10,000. When district court jurisdiction is based on the Little Tucker Act, a
district court may grant damages but not equitable relief. Doe v. United States,
372 F.3d 1308, 1312 (Fed. Cir. 2004). Such jurisdiction is not at issue here
because the claim exceeds the $10,000 threshold, if it is construed as a
request for money damages. See Docket 21.
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immunity and does not create a substantive right enforceable against the
government. United States v. White Mountain Apache Tribe, 537 U.S. 465, 472
(2003). Additionally, the Tucker Act does not give the Court of Federal Claims
the ability to grant any equitable relief, with certain limited exceptions not
relevant here. Bowen v. Massachusetts, 487 U.S. 879, 905 (1988).
The United States takes the position that the relief requested by
Middlebrooks is essentially a claim for money damages, which would require his
claim to be heard in the Court of Federal Claims pursuant to the Tucker Act.
Middlebrooks argues that his claim is for equitable relief under the APA, which
would require his claim to be heard in federal district court.
As an initial matter, the United States appears to contend that its Rule
12(b)(1) challenge is a factual challenge rather than a facial challenge. See
Docket 17 at 6-7 (reciting the standards for a factual challenge under Rule
12(b)(1)). But there are no disputed facts raised by the parties. Instead, the
parties dispute the legal classification of Middlebrooks’s requested relief.
Because there are no factual disputes for the court to resolve at this point, and
the Rule 12(b)(1) argument turns on whether Middlebrooks’s complaint on its
face falls within this court’s jurisdiction, the court considers it as a facial
challenge to the court’s subject matter jurisdiction.
To determine whether a claim is for money damages or equitable relief, a
court “must look beyond the form of the pleadings to the substance of the
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claim. . . . [D]ressing up a claim for money as one for equitable relief will not
remove the claim from Tucker Act jurisdiction and make it an APA case.”
Suburban Mortg. Assocs., 480 F.3d at 1124; accord Sellers v. Brown, 633 F.2d
106, 108 (8th Cir. 1980) (“We must look beyond the facial allegations of the
complaint to determine the true nature of this suit.”). Money damages “are
intended to provide a victim with monetary compensation for an injury to his
person, property, or reputation . . . .” Bowen, 487 U.S. at 893. An equitable
action for specific relief may include “ ‘the recovery of specific property or
monies, ejectment from land, or injunction either directing or restraining the
defendant officer’s actions.’ ” Id. (emphasis in original) (quoting Larson v.
Domestic & Foreign Commerce Corp., 337 U.S. 682, 688 (1949)).
The mere fact that a remedy may require one party to pay money to
another does not automatically classify the relief as money damages. Id. at 89394. To classify a claim as equitable relief, the relief sought must have some
significant effect or value beyond fixing the amount of money the government
must pay. See State of Minn. v. Heckler, 718 F.2d 852, 858 (8th Cir. 1983).
“Damages are given to the plaintiff to substitute for a suffered loss, whereas
specific remedies ‘are not substitute remedies at all, but attempt to give the
plaintiff the very thing to which he was entitled.’ ” Bowen, 487 U.S. at 895
(emphasis in original) (quoting D. Dobbs, Handbook on the Law of Remedies 135
(1973)).
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The amended complaint requests a declaration that the recommended
procedure is covered and an injunction prohibiting the United States from
denying payment for the recommended procedure. Docket 12 at 4. The relief
requested by Middlebrooks in the amended complaint is similar to the example
the Supreme Court cited in Bowen as equitable relief, stating “ ‘the Town
repeatedly characterized reimbursement as “damages,” but that simply is not
the case. Reimbursement merely requires the Town to belatedly pay expenses
that it should have paid all along and would have borne in the first instance
. . . .’ ” Bowen, 487 U.S. at 894 (quoting Sch. Comm. of Burlington v. Dep’t of
Educ. of Mass., 471 U.S. 359, 370-71 (1985)). In this case, Middlebrooks is not
requesting money to make him whole for a past wrong, he is requesting that the
government be compelled to pay what he contends it was already obligated to
pay. Furthermore, the equitable remedies requested by Middlebrooks will have
value apart from fixing the liability of the government. Declarative relief that
dental treatment for TDO is covered under TRICARE would assist Middlebrooks
in obtaining coverage for any future dental care.
In deciding whether claims for TRICARE benefits should be heard in a
federal district court or in the Court of Federal Claims, judges have frequently
focused on whether the claimant received treatment and then sought to recover
for the cost of treatment, or whether the claimant brought suit before receiving
treatment to obtain relief from the denial of coverage. See generally Doe v. United
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States, 372 F.3d 1308, 1312 (Fed. Cir. 2004) (classifying a claim as equitable
relief where the plaintiff was denied coverage and filed suit before having the
procedure); Britell v. United States, 372 F.3d 1370, 1376-77 (Fed. Cir. 2004)
(holding that, when the plaintiff had an abortion, paid the hospital, and then
sued for reimbursement, the claim was for damages and was properly brought
under the Little Tucker Act); Smith v. Office of Civilian Health & Med. Program of
the Uniformed Servs., 97 F.3d 950, 954 (7th Cir. 1996) (approving of APA review
in federal district court of a refusal to pre-authorize coverage); Wilson v. Office of
Office of Civilian Health & Med. Program of the Uniformed Servs., 65 F.3d 361,
362 (4th Cir. 1995) (affirming the district court’s issuance of a permanent
injunction prohibiting CHAMPUS from denying payment for treatment); Johnson
v. United States, 41 Fed. Cl. 341, 346 (Fed. Cl. 1998) (“Had Ms. Johnson actually
paid [the medical provider] herself, she would likely have a cognizable claim
under a money mandating regulation or a claim seeking [money damages].”);
Bishop v. Office of Civilian Health & Med. Program of the Uniformed Servs., 917
F. Supp. 1469, 1473 (E.D. Wash. 1996) (granting summary judgment for
plaintiff requesting preliminary and permanent injunctions enjoining CHAMPUS
from denying coverage and declaratory relief that plaintiff’s treatment was
covered by CHAMPUS); Green Hosp. v. United States, 23 Cl. Ct. 393, 399 (Cl. Ct.
1991) (holding that a hospital’s claim for reimbursement was a claim for money
damages).
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Middlebrooks filed his amended complaint before receiving treatment.
Therefore, at the time he filed suit, he could not have been suing for
reimbursement because he had not yet incurred any expenses. As in Doe, Smith,
Wilson, and Bishop, that fact suggests that Middlebrooks’s claim is not a claim
for money damages disguised as equitable relief.
In Doe, the plaintiff was denied coverage for an abortion of an anecephalic
pregnancy. Doe, 372 U.S. at 1310. Following the denial, she filed suit, and the
district court granted a temporary restraining order, which it later converted
into a preliminary injunction, based on the fact that the plaintiff’s financial
circumstances would force her to carry the fetus to term and endure irreparable
psychological and physical harm. Id. at 1310-11, 1314. Before the litigation was
resolved, the plaintiff obtained an abortion and the government paid for the
procedure. Id. at 1311. In holding that the requested relief remained equitable
and was not transformed into a request for money damages, the Federal Circuit
focused on the relief requested in the complaint. Id. at 1313. The Federal Circuit
distinguished Doe’s circumstances from Britell, where the plaintiff “clearly and
solely” requested money damages after paying the hospital herself. Id. at 131617.
Although they are not identical, Doe bears a number of similarities to the
facts presented here. Middlebrooks filed suit before obtaining treatment.
Middlebrooks requested equitable relief in the amended complaint. The fact that
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Middlebrooks did not seek a temporary restraining order or preliminary
injunction does not transform this case into a request for money damages
because the remedy he sought was limited to injunctive and declaratory relief.
In fact, Middlebrooks’s suit has greater prospective value than Doe because
Middlebrooks may need additional treatment in the future.
Because the court has found that Middlebrooks’s claim is a request for
equitable relief under the APA, the court must also ensure that Middlebrooks
meets the other requirements for APA jurisdiction. In addition to barring claims
for money damages, the APA also excludes claims if another statute granting
consent to suit expressly or impliedly forbids the relief sought or if there is an
adequate remedy in another court. 5 U.S.C. §§ 702, 704. The United States does
not argue that another statute expressly or impliedly forbids the relief
Middlebrooks seeks. The United States does contend, however, that an adequate
remedy is available in the Court of Federal Claims for money damages. This
argument is really another phrasing of the United States’s core argument that
Middlebrooks is really requesting money damages and not equitable relief. For
the reasons stated above, Middlebrooks properly stated a claim for equitable
relief above and apart from the value of the money the United States would pay
for his care, so a claim for money damages in the Court of Federal Claims would
not be an adequate alternative remedy.
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Finally, the United States argues that even if Middlebrooks has asserted a
valid APA claim, he has failed to exhaust his administrative remedies because at
the time of the amended complaint, Middlebrooks had not undergone the
treatment. The APA requires that an administrative act be final before it may be
reviewed. 5 U.S.C. § 704. The United States bases this argument on the fact that
Middlebrooks had not yet received his treatment, which normally is one of the
steps in obtaining TRICARE coverage. Docket 17 at 21-22. But adjunctive dental
care requires preauthorization under TRICARE policy. Docket 18-3 at 4.
Although TRICARE beneficiaries may be able to obtain partial payment for
adjunctive dental care without preauthorization, that fact does not mean
Middlebrooks has an additional administrative remedy when he has already
been denied benefits. In fact, the letter denying coverage from the office of the
Assistant Secretary of Defense to Middlebrooks’s attorney states, “[t]his letter
constitutes the final administrative determination in this case as the facts have
been determined.” Docket 18-1 at 3. Having received a final administrative
determination, Middlebrooks was not required to receive treatment and hope
that partial payment would later be authorized in order to exhaust his
administrative remedies.
B. Standing
Before this court can consider the merits of this claim, Middlebrooks must
demonstrate Article III standing, which requires a justiciable case or
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controversy. See Whitmore v. Arkansas, 495 U.S. 149, 154-55 (1990). “The
Constitution requires a party to satisfy three elements before it has standing to
bring suit in federal court: injury in fact, causation, and redressability.”
Campbell v. Minneapolis Pub. Hous. Auth., 168 F.3d 1069, 1073 (8th Cir. 1999)
(citing Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83 (1998)). An injury in
fact must be concrete and particularized, and actual or imminent rather than
conjectural or hypothetical. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560
(1992).
The United States argues that because Middlebrooks had not incurred
any costs prior to the filing of the amended complaint, Middlebrooks cannot
establish an actual or concrete injury. Docket 17 at 23. First, the denial of
benefits itself can be a concrete injury. See Alcala v. Burns, 545 F.2d 1101, 1104
(8th Cir. 1976) (finding that a denial of benefits conferred standing); see also
Flores v. United States, No. 11-12119, 2011 WL 4806769, at *6-7 (E.D. Mich.
Oct. 11, 2011) (holding that a denial of TRICARE coverage is sufficient to confer
standing). Numerous federal courts have allowed plaintiffs to challenge a denial
of preauthorization for medical care, further supporting that the denial of
benefits is a sufficient injury. Second, Middlebrooks had a specific course of
treatment in place, not a hypothetical treatment he might undergo some time in
the future. Third, even if the denial of benefits does not itself constitute a harm
sufficient to confer standing, Middlebrooks is exposed to imminent harm arising
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from allegedly being improperly denied necessary medical treatment for a
serious, ongoing condition. Because Middlebrooks’s injury is not ill-defined or
speculative, he has demonstrated standing to challenge his denial of benefits.
II.
Failure to State a Claim
A Rule 12(b)(6) motion “only tests whether the claim has been adequately
stated in the complaint.” Charles Alan Wright and Arthur R. Miller, 5B Federal
Practice and Procedure § 1356 (3d ed.). A complaint is subject to dismissal only
when it fails to meet the liberal pleading standard under Rule 8(a), and a motion
to dismiss is not a procedure for resolving factual or substantive questions
about the merits of a case. Id. The United States contends that, even if this
court has subject matter jurisdiction, TRICARE’s dental coverage is limited and
Middlebrooks’s condition does not fit one of the enumerated exceptions. Docket
17 at 24.
To obtain relief under the APA, a plaintiff must show that the challenged
agency action was arbitrary, capricious, an abuse of discretion, or otherwise not
in accordance with law. 5 U.S.C. § 706. Middlebrooks has pleaded facts showing
that he has a congenital condition and his doctors recommend certain dental
procedures to treat that condition. He has also pleaded facts that he is eligible
for some benefits under TRICARE, that TRICARE offers some coverage for dental
care related to severe congential anomalies, and that TRICARE refused to cover
his requested treatment. These facts are sufficient to state a plausible claim
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upon which relief could be granted. Whether his specific condition is covered as
a severe congenital anomaly, or whether his dental treatment would otherwise
qualify as treatment of his underlying medical condition, are questions beyond
the scope of a Rule 12(b)(6) motion.
CONCLUSION
Middlebrooks’s requested relief is equitable in nature. Therefore, this
action is properly brought in this court under the APA. Middlebrooks has shown
an injury in fact sufficient to confer standing, and he has exhausted his
administrative remedies. Middlebrooks has also pleaded facts sufficient to
demonstrate a plausible claim to relief. Accordingly, it is
ORDERED that the United States’s motion to dismiss the complaint
(Docket 8) is denied as moot.
IT IS FURTHER ORDERED that the United States’s motion to dismiss the
amended complaint (Docket 16) is denied.
Dated March 20, 2014.
BY THE COURT:
/s/ Karen E. Schreier
KAREN E. SCHREIER
UNITED STATES DISTRICT JUDGE
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