Mayor & City Council of Balt. v. Azar

• Decision Date: 14 February 2020
• Docket Number: Civil Action No.: RDB-19-1103
• Citation: 439 F.Supp.3d 591
• Parties: MAYOR AND CITY COUNCIL OF BALTIMORE, Plaintiff, v. Alex M. AZAR II, Secretary of Health and Human Services, et al., Defendants.
• Court: U.S. District Court — District of Maryland

439 F.Supp.3d 591

MAYOR AND CITY COUNCIL OF BALTIMORE, Plaintiff,

v.Alex M. AZAR II, Secretary of Health and Human Services, et al., Defendants.

Civil Action No.: RDB-19-1103

United States District Court, D. Maryland.

Signed February 14, 2020

Andre M. Davis, Jane Hannah Lewis, Suzanne Sangree, City of Baltimore Law Department, Baltimore, MD, Andrew T. Tutt, Pro Hac Vice, Drew A. Harker, Pro Hac Vice, Allyson Tracey Himelfarb, Arnold and Porter Kaye Scholder LLP, Washington, DC, Dana Petersen Moore, Office of the City Solicitor, Faren M. Tang, Pro Hac Vice, Reproductive Rights and Justice Project, Yale Law School, New Haven, CT, Marisa White, Pro Hac Vice, Arnold and Porter Kaye Scholer LLP, Stephanie Toti, Pro Hac Vice, Lawyering Project, New York, NY, Priscilla Joyce Smith, Pro Hac Vice, RRJP Clinic, Yale Law School, Brooklyn, NY, for Plaintiff.

Tarra DeShields Minnis, Office of the United States Attorney, Baltimore, MD, Bradley Philip Humphreys, United States Department of Justice, Washington, DC, Robert Charles Merritt, US Department of Justice Federal Programs Branch, Richmond, VA, for Defendants.

MEMORANDUM OPINION

Richard D. Bennett, United States District Judge

As has been discussed at length in this Court's Memorandum Opinion of May 30, 2019(ECF No. 43), the Plaintiff Mayor and City Council of Baltimore("Baltimore City" or "the City") challenges a rule promulgated by the United States Department of Health and Human Services("HHS" or "the Government") that would amend federal regulations with respect to the funding of family planning services.¹This Court granted a Preliminary Injunction against HHS with respect to Counts I and II, alleging violations of the Non-Interference Provision of the Affordable Care Act, 42 U.S.C. § 18114, and the Non-Directive Mandate of the Continuing Appropriations Act, 2019, Pub. L. 115-245,132 Stat. 2981, 3070-71(2018).For the reasons set forth in that Memorandum Opinion of May 30, 2019, this Court held that there was a likelihood of success on the merits with respect to those claims.

On July 2, 2019, a divided panel of the United States Court of Appeals for the Fourth Circuit granted a stay of that injunction pending appeal.(SeeECF No. 58.)²Subsequently, the Fourth Circuit heard oral argument on the interlocutory appeal of the preliminary injunction on September 18, 2019, and a decision has not been rendered.In the interim, community clinics and health centers in Baltimore have been adversely affected as the rule promulgated by HHS has been implemented and remains in effect.Subsequently, this Court dismissed Count IV and Count X of the original ten-count Complaint without prejudice.(ECF No. 74.)

This Court has adhered to a briefing schedule as to the remaining six counts, with Baltimore City and HHS having filed cross-motions for summary judgment.After having held a hearing on January 27, 2020 and having heard the arguments of counsel, this Court has conducted a thorough review of the Administrative Record in this matter.While the Defendant HHS is entitled to Summary Judgment with respect to some of the remaining six counts, specifically Counts III, V, VI, and IX, Baltimore City is entitled to Summary Judgment with respect to Counts VII and VIII.Specifically, after a thorough review of the Administrative Record in this case, this Court holds that the proposed rule as promulgated violates the Administrative Procedure Act,5 U.S.C. § 701, et seq. , in that it is arbitrary and capricious, being inadequately justified and objectively unreasonable.The Administrative Record reflects that literally every major medical organization in the United States has opposed implementation of this rule.There is almost no professional support for its implementation.

Baltimore City originally brought a ten-Count Complaint pursuant to the Administrative Procedure Act("APA") against Alex M. Azar II, in his official capacity as the Secretary of Health and Human Services; United States Department of Health and Human Services; Diane Foley, M.D., in her official capacity as the Deputy Assistant Secretary, Office of Population Affairs; and Office of Population Affairs.(Compl., ECF No. 1.)The City challenges the final rule ("Final Rule" or "Rule") entitled Compliance with Statutory Program Integrity Requirements , 84 Fed. Reg. 7714(Mar. 4, 2019), codified at42 C.F.R. Part 59.The Final Rule amends the regulations developed to administer Title X of the Public Health Service Act,42 U.S.C. §§ 300 to 300a-6, which provides federal funding for family-planning services.(Id.at ¶¶ 1, 3.)

After an April 30, 2019 hearing, this Court entered a preliminary injunction on May 30, 2019 as to Counts I and II, enjoining enforcement of the Final Rule in the State of Maryland.(SeeECF Nos. 43, 44.)Injunctive relief was based on this Court's holding that the Final Rule likely violated provisions of the Affordable Care Act, 42 U.S.C. § 18114, enacted in 2010(as alleged in Count I), and Congress' Non-Directive Mandate in the Continuing Appropriations Act, 2019, Pub. L. 115-245,132 Stat. 2981, 3070-71(2018)(as alleged in Count II).In short, this Court held that existing laws passed by the United States Congress cannot be circumvented by administrative orders of the executive branch of government.On July 2, 2019, a divided panel of the United States Court of Appeals for the Fourth Circuit granted the Government's Motion to Stay the Injunction Pending Appeal.(SeeECF No. 58.)That appeal remains pending and therefore, at this time, the preliminary injunction that this Court granted is stayed, and the Final Rule is in effect.The Fourth Circuit held oral argument on the interlocutory appeal of the preliminary injunction on September 18, 2019, and a decision has not yet been issued.SeeMayor and City Council of Baltimore v. Azar , No. 19-1614(4th Cir. filed June 6, 2019).

On September 12, 2019, this Court dismissed without prejudice Count IV (Violation of APA § 706—Contrary to Law—Contrary to Religious Freedom Restoration Act of 1993,42 U.S.C. § 2000bb-1(a) ) and Count X (Violation of APA—Contrary to Constitutional Right—Unconstitutionally Vague), and allowed Counts I, II, III, V, VI, VII, VIII, and IX to proceed on the merits.(ECF No. 74.)Presently pending are the parties' cross-motions for summary judgment on the remaining Counts.(ECF Nos. 81, 82.)This Court held a hearing on January 27, 2020, has heard the arguments of counsel, has reviewed the submissions of the parties, and has reviewed the expansive Administrative Record in this case.

The executive branch of government is not entitled to promulgate administrative rules where an agency's explanation "runs counter to the evidence before the agency."SeeMotor Vehicle Mfrs. Ass'n of the United States v. State Farm Mut. Auto Ins. Co. , 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443(1983).Accordingly, for the reasons that follow, summary judgment IS ENTERED in favor of Plaintiff on Counts VII and VIII.Specifically, after a thorough review of the Administrative Record in this case, this Court holds that the proposed rule as promulgated violates the Administrative Procedure Act in that it is arbitrary and capricious, being inadequately justified and objectively unreasonable.However, summary judgment IS ENTERED in favor of Defendants on Counts III, V, VI, and IX, alleging that the rule as promulgated is contrary to Title X's voluntariness requirement, contrary to constitutional right pursuant to the First Amendment and Equal Protection under the Fifth Amendment, and without observance of procedure required by law.Accordingly, the Government shall be permanently enjoined from implementing or enforcing any portion of the Final Rule in the State of Maryland.

BACKGROUND

The background of this case was discussed at length in this Court's prior Memorandum Opinion of May 30, 2019 granting Plaintiff's Motion for Preliminary Injunction and this Court's prior Memorandum Order of September 12, 2019, granting in part and denying in part Defendants' Motion to Dismiss.(SeeECF Nos. 43, 74.)In brief, almost fifty years ago, in 1970, Congress enacted Title X, the only federal program specifically dedicated to funding family planning services.Public Health Service Act,84 Stat. 1506, as amended42 U.S.C. §§ 300 to 300a–6;(Pl.'s Exhibit 4 at PEP109, ECFNo. 81-2.)

Title X addresses low-income individuals' lack of equal access to family planning services by authorizing the Secretary of Health and Human Services to "make grants and to enter into contracts with public or nonprofit private entities to assist in the establishment and operation of voluntary family planning projects which shall offer a broad range of acceptable and effective family planning methods and services."Id.§ 300(a).Section 1008 of the Act provides that "[n]one of the funds appropriated under this subchapter shall be used in programs where abortion is a method of family planning."Id.§ 300a–6.Consistent with this restriction, HHS has never permitted Title X grantees to use Title X funds to perform or subsidize abortions.See42 C.F.R. §§ 59.5(a)(5),59.9 (1986).

Title X programs provide sexual and reproductive healthcare with priority given to low-income individuals.(Pl.'s Exhibit 4 at PEP112, ECFNo. 81-2.)Services include a broad range of contraceptive options; contraceptive education and counseling; breast and cervical cancer screening ; testing, referral, and prevention education for sexually transmitted infections/diseases ("STIs/STDs"), including human immunodeficiency virus ("HIV"); and pregnancy diagnosis and counseling.(Id. at PEP109, PEP118-120.)

I.The Final Rule.

On May 22, 2018, HHS posted on its website a notice of proposed rulemaking entitled Compliance With Statutory Program Integrity Requirements , 83 Fed. Reg. 25,502("Proposed Rule").See84 Fed. Reg. 7714, 7726(Mar. 4, 2019).The Proposed Rule was published in the Federal Register on June 1, 2018.Id.;83...