Bracco v. Lackner

Decision Date05 April 1978
Docket NumberCiv. A. No. C-78-0471SAW.
PartiesGuy BRACCO et al., Plaintiffs, v. Jerome LACKNER, M. D., Individually and in his official capacity as Director of the California Department of Health, Defendant and Third-Party Plaintiff, v. QUALITY CARE CONVALESCENT HOSPITAL CENTERS, INC., a California Corporation, dba the San Franciscan Center, Joseph A. Califano, Secretary, United States Department of Health, Education and Welfare, Third-Party Defendants.
CourtU.S. District Court — Northern District of California



Public Advocates, Inc. by Sidney M. Wolinsky, Angela Glover Blackwell, San Francisco, Cal., for plaintiffs.

Evelle J. Younger, Atty. Gen., State of Cal., San Francisco, Cal., by Asher Rubin, John Davidson, John Klee, Jr., Deputy Attys. Gen., Ann Miley, California Dept. of Health, San Francisco, Cal., for defendant and third-party plaintiff Jerome Lackner, M.D., et al.

G. William Hunter, U. S. Atty., San Francisco, Cal., by Richard De Saint Phalle, George Christopher Stoll, Asst. U. S. Attys., Cade Morrow, HEW, San Francisco, Cal., for third-party defendant U. S. Dept. of Health, Ed. and Welfare.

Trope & Trope by Eugene L. Trope, Los Angeles, Cal., for third-party defendant Quality Care Convalescent Hospital Centers, Inc.

Van Bourg, Allen, Weinberg & Roger by Stefanie Arthur, San Francisco, Cal., amicus curiae.

Joseph Freitas, Jr., Dist. Atty., by David Moon, San Francisco, Cal., for the Office of the District Attorney, City and County of San Francisco.


WEIGEL, District Judge.

These relatively extended Findings and Conclusions, supplementing those in the preamble of the Preliminary Injunction itself, have been prepared by the Court as expeditiously as feasible under the somewhat unusual circumstances of the course of these proceedings from inception to the present.

The plaintiffs are 44 needy, elderly patient-residents of the San Franciscan Convalescent Center ("Center") in San Francisco, California. They seek to represent a class of approximately 150. All but ten plaintiffs and class members are not ambulatory. All need supervised nursing or medical attention and are beneficiaries of "Medicaid" under a federal statutory scheme. Plaintiffs claim that their health and lives are endangered by an imminent cut-off of federal and state benefits forcing their immediate removal from the Center. Officials of the State of California claim the cut-off is required because the private operator has failed to meet established standards for certification.

Shortly after the filing of suit, the Court granted temporary restraining orders (Appendices A and B attached) and an order to show cause why a preliminary injunction should not be issued. At the start of the hearing on the order to show cause, the Court put questions to all counsel relating to the issues. Their answers were unanimous that no resident of the Center should be transferred if it would seriously jeopardize the resident's life and health, that operation of the Center should be continued if the requisite standards could be met and that there is a serious shortage of facilities in San Francisco for care of the needy elderly—care required by state and federal law.

Moreover, all counsel quickly stipulated to a number of matters upon which they were previously in bitter conflict. Their unanimity of goals and their cooperative stipulations augured well for disposition of the lawsuit through settlement, especially when the attorneys enthusiastically agreed to settlement procedures suggested by the Court. The Court participated in the settlement process on the request of all counsel and on their readily given stipulations, made on the record, that the settlement discussions would be and remain wholly off the record in the interest of candid and uninhibited expression by all.

The Honorable Harry W. Low, a judge of the San Francisco Superior Court, before whom was pending a matter relating to the Center, was pleased to join in the settlement efforts. Judge Low, at the outset of his participation, was made privy to the stipulations regarding the privacy of settlement procedures. The stipulations in that regard were renewed by all parties in his presence and he joined this Court in approving them.

Unhappily, the bright prospects for settlement, after extended devotion of time and effort, were dissipated. This required the Court to proceed with consideration of the motion for a preliminary injunction.

The time within which the Court had to rule on that motion was severely limited by two factors. It appeared that, subject only to possible state court intervention, by no means assured, the Center would close for lack of funds at the end of the third day following completion of the hearing on the motion for a preliminary injunction. The second factor requiring prompt action by the Court was related. The defendant State of California officials refused to agree to maintain the status quo for a week following the submission of the motion for a preliminary injunction so as to enable the Court to have a reasonable length of time for consideration of the matter without concern that, as a practical matter, the Court's power for effective action would be destroyed by the closing of the Center and the necessary prior removal of the patient-residents therefrom.

The Court therefore found itself in the position of having to rule upon the motion for a preliminary injunction almost immediately after submission by the parties. Having anticipated, for several days, the possibility of such "forced" quick action (and having had the benefit of a substantial body of evidence in the form of affidavits submitted by the parties upon which alone, under local court rules, motions for preliminary injunction are normally decided) the Court was in a position to act with the requisite promptness.

It was under these circumstances that the Court was called upon to decide whether or not the plaintiffs were, under the governing standards of the Ninth Circuit, entitled to a preliminary injunction. On the facts and the law now to be set out, the Court resolved that question in the affirmative by granting a preliminary injunction, a copy of which is attached as Appendix C.

I. Parties.1

The named plaintiffs are forty-four patients of the Center. They bring suit on their own behalf and on behalf of a proposed class defined as "all persons who are residing at the San Franciscan Convalescent Center who do now or have, during the course of their residence, been the beneficiaries of any federal or state benefits." The defendant Jerome Lackner, M.D.2 is sued individually and in his official capacity as Director of the California Department of Health ("Department"). The Department has filed a third party complaint against Quality Care Convalescent Homes, Inc. ("Quality Care") and Joseph A. Califano, Secretary, United States Department of Health, Education and Welfare ("HEW"), third party defendants.

II. Summary of Allegations of Plaintiffs' First Amended Complaint.

Invoking the jurisdiction of this Court under 28 U.S.C. §§ 1331, 1343(3) and 1343(4), plaintiffs have filed this class action pursuant to Fed.R.Civ.P. 23(a) and (b)(2). They claim that the Department threatens them with unlawful transfer from the Center without notice or opportunity for hearing, and without an adequate relocation plan. They allege that such action may cause injury to their physical and mental health including risk to life. They claim also that some plaintiffs have been improperly reclassified by the Department to receive lower levels of care. Plaintiffs charge that these actions violate Title XIX of the Social Security Act and the regulations promulgated thereunder governing the Medicaid Program, as well as rights based upon the Constitution and state law. They seek injunctive and declaratory relief to prevent their relocation without adequate notice, hearing, and a relocation plan designed to meet their urgent needs.

The Department in its Answer to Plaintiffs' First Amended Complaint denies that it has acted unlawfully in any manner, that a claim for relief is stated under any federal statute or regulation, and that the alleged class would constitute a proper class in this action. The Department seeks a judgment by this Court abstaining from exercising its jurisdiction and denying plaintiffs relief.

III. State Court Action.

In July of 1977, Quality Care assumed operation of the Center under a six month provisional license issued by the Department. Claiming that frequent inspections revealed continuing violations of health and safety code regulations, the Department declined to renew that provisional license.

Under authority granted by Calif. Health & Saf. C. § 1291, the Department filed suit in the Superior Court of the State of California in San Francisco, asking injunction against continued unlicensed operation of the Center and authorization for transfer of the Center's patients to other facilities. That action (San Francisco County Superior Court No. 731-253) resulted in an "Interim Order Re Issuance of License", issued by Judge Harry W. Low on January 9, 1978.

The Interim Order required the Department to issue to Quality Care a provisional license and required Quality Care to attempt the sale or transfer of its interest in the Center by April 15, 1978. It further provided, inter alia, that Quality Care should hire additional staff and maintain the Center at a level meeting state standards. In the event no licensed transferee could be found, the Court would order implementation of a patient transfer plan. The Department was to prepare, for the approval of the Superior Court, a contingency plan for the careful and orderly transfer of the patients. The Superior Court retained jurisdiction to issue such further orders as necessary for the health and safety of...

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