CALIFORNIA LEGISLATIVE COUN., OLDER AMER. v. Weinberger

• Decision Date: 05 April 1974
• Docket Number: Civ. No. S74-32.
• Citation: 375 F. Supp. 216
• Court: U.S. District Court — Eastern District of California
• Parties: CALIFORNIA LEGISLATIVE COUNCIL FOR OLDER AMERICANS, an unincorporated voluntary association, et al., Plaintiffs, v. Caspar W. WEINBERGER, Individually and in his capacity as Secretary of the United States Department of Health, Education and Welfare, et al., Defendants.

375 F. Supp. 216

CALIFORNIA LEGISLATIVE COUNCIL FOR OLDER AMERICANS, an unincorporated voluntary association, et al., Plaintiffs, v. Caspar W. WEINBERGER, Individually and in his capacity as Secretary of the United States Department of Health, Education and Welfare, et al., Defendants.

Civ. No. S74-32.

United States District Court, E. D. California.

April 5, 1974.

Robert M. Teets, Jr., Peter E. Sitkin Food Advocates, Berkeley Cal., Ralph Santiago Abascal, San Francisco Neighborhood Legal Assistance Foundation, Peter D. Coppelman, Philip Neumark, Cal. Rural Legal Assistance Senior Citizens Project of the National Senior Citizens Law Center, San Francisco, Cal., for plaintiffs.

Evelle J. Younger, Atty. Gen. of Cal., for California defendants.

John J. Klee, Jr., San Francisco, Cal., N. Eugene Hill, Dwayne Keyes, U. S. Atty., Brewster Q. Morgan, Sacramento, Cal., for Federal defendants.

MEMORANDUM OF OPINION AND JUDGMENT

RENFREW,^* District Judge.

Plaintiffs,¹ four unincorporated associations,² representing elderly, disabled and blind citizens, an officer of each association,³ and an individual, Philip E. Draper, who is disabled and has received food stamps under the federal Food Stamp Program, 7 U.S.C. §§ 2011-2026, challenge a determination made by one defendant,⁴ Secretary of Health, Education and Welfare (HEW) Weinberger (hereinafter "Secretary"), under P.L. 93-233, § 8, which in effect suspended the Food Stamp Program in California for the elderly, disabled, and blind as of January 30, 1974, and until at least July 1, 1974. In place of food stamps, the eligible recipients are now receiving payments under a federally administered program through which both federal and state welfare funds are channeled. Plaintiffs seek to invoke the jurisdiction of this Court⁵ under 28 U. S.C. §§ 1337 and 1361 and under 5 U.S. C. § 701 et seq.

Plaintiffs attack both the manner in which the Secretary made his decision and the decision itself, contending that it was arbitrary and capricious. They ask for a preliminary injunction postponing the effect of the decision pending review of it by this Court, for an order holding unlawful and setting aside the decision and remanding the matter to the Secretary for redetermination, and for a declaratory judgment that the Secretary's determination violated P.L. 93-233, § 8, and 5 U.S.C. § 706(2)(A) and (C).

Hearings were held on the motion for a preliminary injunction on March 11 and 12, 1974. At the close of those hearings, all parties agreed that the trial on the merits should be consolidated with the hearings on the preliminary injunction under Rule 65(a)(2), Federal Rules of Civil Procedure. The Court so ordered, and the matter was submitted.

I. Jurisdiction

Since this case involves the federal Food Stamp Program, which is an act of Congress regulating commerce,⁶ this Court has jurisdiction under 28 U. S.C. § 1337. Lidie v. State of California, 478 F.2d 552, 554 (9 Cir. 1973); Moreno v. United States Department of Agriculture, 345 F.Supp. 310, 313 (D.D. C.1972), aff'd, 413 U.S. 528, 93 S.Ct. 2821, 37 L.Ed.2d 782 (1973).

The federal defendants, however, contend that, under the doctrine of Larson v. Domestic & Foreign Corp.,⁷ 337 U.S. 682, 689-690, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949), this lawsuit was actually brought against the United States without its consent and therefore must be dismissed as to them. The Court disagrees. One exception to the rule of sovereign immunity arises when the federal officer's action is ultra vires:

"* * * where the officer's powers are limited by statute, his actions beyond those limitations are considered individual and not sovereign actions. The officer is not doing the business which the sovereign has empowered him to do or he is doing it in a way which the sovereign has forbidden. His actions are ultra vires his authority and therefore may be made the object of specific relief. It is important to note that in such cases the relief can be granted, without impleading the sovereign, only because of the officer's lack of delegated power. A claim of error in the exercise of that power is therefore not sufficient." Larson, supra, 337 U.S. 682, at 689-690, 69 S.Ct. 1457, at 1461, 93 L.Ed. 1628.

Plaintiffs' theory is, essentially, that the Secretary misinterpreted the statute authorizing him to take certain action, P. L. 93-233, § 8(c), and that as a result the action that he took was beyond the authority given him by Congress.⁸ Therefore, plaintiffs' claim does fall within the ultra vires exception to the Larson rule of sovereign immunity. See State of Washington v. Udall, 417 F.2d 1310, 1316-1317 (9 Cir. 1969); Association of N.W. Steel., etc. v. United States Army Corps of Eng., 485 F.2d 67, 69 (9 Cir. 1973). Cf. Scholder v. United States, 428 F.2d 1123, 1127 (9 Cir. 1970), cert. denied, 400 U.S. 942, 91 S.Ct. 240, 27 L.Ed.2d 246 (1970).

Even if an action falls within an exception to the bar of sovereign immunity, it may still fail if the relief sought would "require affirmative action by the sovereign or the disposition of unquestionably sovereign property." Larson, supra, 337 U.S. 682, at 691, n. 11, 69 S. Ct. 1457, at 1462, 93 L.Ed. 1628. The relief requested by plaintiffs does not raise problems of this sort. See Rockbridge v. Lincoln, 449 F.2d 567, 573 (9 Cir. 1971); State of Washington v. Udall, supra, 417 F.2d 1310, 1318-1319 (9 Cir. 1969).

Plaintiffs' action is also not barred by 5 U.S.C. § 701(a)(1) or (2). See Abbott Laboratories v. Gardner, 387 U.S. 136, 140-141, 87 S.Ct. 1507, 18 L. Ed.2d 681 (1967); State of Washington v. Udall, supra, 417 F.2d 1310, 1319-1320 (9 Cir. 1969).

II. The Relevant Federal Legislation

An understanding of the general outlines of the legislation that forms the background of this lawsuit is necessary in order to comprehend fully the precise issues and specific provisions that it involves. Although written in a style and form dear only to the hearts of Congressional draftsmen, the major policies and principles enacted in these recent statutes are relatively clear.

On October 30, 1973, Congress passed P.L. 92-603, often referred to by its House number, H.R. 1. By these statutory provisions, Congress repealed and replaced, as of January 1, 1974, the system of federal grants-in-aid to state-administered welfare programs.⁹ Under this new system, the federal government would make payments¹⁰ from its own funds to eligible¹¹ aged, blind, and disabled individuals. States could elect to make supplemental payments and could enter into an agreement with the Secretary to have federal administration of the payments, thus saving the states the costs of administration. P.L. 92-603, § 301 (§ 1616 of the Social Security Act as amended); 42 U.S.C. § 1382e. Another substantial benefit to the states was made available at their option. If a state made supplementary payments to the eligible recipients which, when added to the federal payments, were at least at the same level as the payments it made to eligible recipients in January, 1972, the state's payment would be no more than its expenditures in aid of such recipients for the calendar year 1972. The federal government, in effect, would assume the burden of increased expenditures at the January, 1972, level of benefits that arose from an increased case-load. This provision, P.L. 92-603, § 401, has been termed the "hold harmless" section in that the states falling within its terms would be held harmless for welfare costs caused solely by the rising number of persons eligible for payments. If the state's supplementary payments exceeded the January, 1972, level, however, the state would have to assume that portion of the payment in excess of the January, 1972, level for all eligible recipients.

P.L. 92-603, § 401(b)(1), also gave the states the option to increase their supplemental payments by the "bonus value" of food stamps.¹² As of Januuary, 1972, without liability for the increased welfare costs. This allowance was clearly an offset to the direct impact which P.L. 92-603 had on the Food Stamp Program. By § 411(a),¹³ persons eligible for the new federal supplementary security income benefits provided for by P.L. 92-603, § 301, were to be ineligible for food stamps as of January 1, 1974. Recipients would be directly compensated for the loss of food stamps if the states elected to increase their supplemental payments, at federal expense, by an amount equal to the bonus value of food stamps.

The foregoing provisions of P.L. 92-603 have been amended by P.L. 93-86 (August 10, 1973) and P.L. 93-233 (December 31, 1973). P.L. 93-86, § 3(b),¹⁴ modified P.L. 92-603, § 411(a), supra, which had precluded food stamps for those eligible for the new federal benefits. Under this amendment, food stamps would still be available for a person who received less in federal and state payments under the new system than he would have received under the prior state welfare plan in December, 1973, plus the bonus value of food stamps (determined by the Food Stamp Schedule effective July, 1973). Eligibility for food stamps, therefore, was to be determined upon an individual basis. See also P.L. 93-86, § 4(c).

Recognizing that certain difficulties were apparent in this individualized eligibility for food stamps,¹⁵ Congress enacted new amendments in P.L. 93-233. The individualized system of determining food-stamp eligibility provided for by P.L. 93-86, § 3(b), was made effective July 1, 1974, rather than January 1, 1974. P.L. 93-233, § 8(a) (2). For the six-month interim period, persons receiving the new federal benefits would be eligible for food stamps unless they resided in a state "which provides State supplementary payments (A) of the type described in section 1616(a) of the Social Security Act, as provided by P.L. 92-603, § 301 and (B) the level of which has been found by the Secretary of Health, Education and Welfare to have been specifically increased so as to include the bonus value...