235 F.3d 1100 (8th Cir. 2000), 99-4324, Deerbrook Pavilion v. Shalala

Docket Nº:99-4324
Citation:235 F.3d 1100
Party Name:DEERBROOK PAVILION, LLC, APPELLANT, V. DONNA E. SHALALA, SECRETARY, U.S. DEPARTMENT OF HEALTH & HUMAN SERVICES; UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES; NANCY-ANN MIN DEPARLE, ADMINISTRATOR, HEALTH CARE FINANCING ADMINISTRATION; JOE L. TILGHMAN, REGIONAL ADMINISTRATOR, HEALTH CARE FINANCING ADMINISTRATION; THOMAS W. LENZ, ASSOCIATE RE
Case Date:December 26, 2000
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit
 
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Page 1100

235 F.3d 1100 (8th Cir. 2000)

DEERBROOK PAVILION, LLC, APPELLANT,

V.

DONNA E. SHALALA, SECRETARY, U.S. DEPARTMENT OF HEALTH & HUMAN SERVICES; UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES; NANCY-ANN MIN DEPARLE, ADMINISTRATOR, HEALTH CARE FINANCING ADMINISTRATION; JOE L. TILGHMAN, REGIONAL ADMINISTRATOR, HEALTH CARE FINANCING ADMINISTRATION; THOMAS W. LENZ, ASSOCIATE REGIONAL ADMINISTRATOR FOR DIVISION OF MEDICAID AND STATE OPERATIONS; HEALTH CARE FINANCING ADMINISTRATION; GARY J. STANGLER, DIRECTOR, MO DEPARTMENT OF SOCIAL SERVICES; MISSOURI DEPARTMENT OF SOCIAL SERVICES; GREGORY J. VADNER, DIRECTOR, MO DEPARTMENT OF MEDICAL SERVICES; MISSOURI DIVISION OF MEDICAL SERVICES, APPELLEES.

No. 99-4324

United States Court of Appeals, Eighth Circuit

December 26, 2000

Submitted: September 15, 2000

Appeal from the United States District Court for the Western District of Missouri.

Page 1101

Before Hansen, Heaney and Morris Sheppard Arnold, Circuit Judges.

Heaney, Circuit Judge.

This case concerns successor liability for civil monetary penalties (CMPs) imposed by the Health Care Financing Administration (HCFA) on a skilled nursing facility (nursing home). HCFA imposed CMPs on a nursing home and, after it was bought by Deerbrook Pavilion, L.L.C. (Deerbrook), HCFA sought to collect the penalties from Deerbrook. Deerbrook then brought a complaint in the district court, alleging that the federal and state defendants lacked the authority to impose CMPs on it, and that doing so was a violation of due process. The district court granted the defendant's motion to dismiss, see Deerbrook

Page 1102

Pavilion, L.L.C. v. Shalala, No. 99- 4179-CV-C-SOW-ECF (W.D. Mo., Nov. 4, 1999), and this appeal followed. As we agree with the district court that HCFA has the authority to impose a civil monetary penalty on Deerbrook, we affirm the dismissal of the complaint.

I. BACKGROUND

In reviewing a Federal Rule of Civil Procedure 12(b)(6) dismissal, we must assume all of the facts alleged in the complaint to be true and affirm only if it is clear that no relief can be granted based on those allegations. See Alexander v. Peffer, 993 F.2d 1348, 1349 (8th Cir. 1993). We review a 12(b)(6) dismissal de novo. See Hilton v. Pine Bluff Pub. Schools, 796 F.2d 230, 231 (8th Cir. 1986). On a motion to dismiss, a court must primarily consider the allegations contained in the complaint, although matters of public and administrative record referenced in the complaint may also be taken into account. See Jackson v. City of Columbus, 194 F.3d 737, 745 (6th Cir. 1999); Sebastain v. United States, 185 F.3d 1368, 1374 (Fed. Cir. 1999).

Prior to Deerbrook's tenure as operator of the nursing home in question, government auditors discovered serious problems that threatened the health and safety of the facility's elderly and infirm residents. The facility had numerous violations of basic sanitary standards and was also cited for neglect to the residents' basic needs. The auditors determined that these conditions put the residents' health in immediate jeopardy and imposed CMPs, which at one period amounted to $6,100 per day. After a period from March 22, 1996 to September 5, 1996, in which surveys revealed repeated violations, the facility was brought into substantial compliance. In total, there were $419,700 in CMPs assessed against the facility.

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