Jewell v. Herke
| Decision Date | 09 March 2021 |
| Docket Number | Case No. 20-CV-1427 (PJS/DTS) |
| Parties | Maria JEWELL ; Eric Parham; Gordon Graham; and Scott Gosha, Plaintiffs, v. Larry HERKE, in his official capacity as Commissioner of the Minnesota Department of Veterans Affairs ; Keith Ellison, in his official capacity as Attorney General of the State of Minnesota ; and Timothy Walz, in his official capacity as Governor of the State of Minnesota, Defendants. |
| Court | U.S. District Court — District of Minnesota |
Brian K. Lewis, FRANCIS WHITE LAW, PLLC, for plaintiffs.
Kevin Jonassen, MINNESOTA ATTORNEY GENERAL'S OFFICE, for defendants.
Plaintiffs Maria Jewell, Eric Parham, and Scott Gosha are military veterans and Minnesota residents who have made or anticipate making claims for veterans benefits to the United States Department of Veterans Affairs ("VA"). Plaintiff Gordon Graham resides in Washington and is a VA-accredited claims agent authorized to represent veterans before that agency. Plaintiffs bring this action to challenge the constitutionality of two Minnesota statutes— Minn. Stat. § 197.6091 and Minn. Stat. § 196.05, subd. 1(12) —that impose certain disclosure requirements on persons who charge a fee to assist veterans who seek benefits from the VA.
This matter is before the Court on defendants' motion to dismiss. For the reasons that follow, the motion is granted in part and denied in part. Specifically, the Court denies the motion as to plaintiffs' claims that the disclosure requirements are preempted by federal law and violate the First Amendment, grants the motion as to plaintiffs' remaining claims, and dismisses all claims against defendant Timothy Walz.
The VA administers programs that provide benefits to veterans and their dependents and beneficiaries. 38 U.S.C. § 301. In pursuing a claim for benefits from the VA, a veteran may use the services of a VA-authorized agent or attorney. Id. § 5904(a)(1). To be authorized by the VA to assist veterans in pursuing claims, an agent or attorney must meet certain standards set by the VA; moreover, an agent or attorney may not be able to practice before the VA if he or she has "been suspended or disbarred by any court, bar, or Federal or State agency to which the individual was previously admitted to practice and [has] not been subsequently reinstated." Id. § 5904(a)(2), (a)(4); 38 C.F.R. § 14.629. After notice and opportunity for a hearing, the VA may suspend an authorized representative for various reasons, including if the representative has been suspended or disbarred by any court, bar, or federal agency. 38 U.S.C. § 5904(b).
The VA also authorizes representatives of federally approved organizations, such as the American Legion and Disabled American Veterans, to represent veterans before the VA. Id. § 5902(a)(1). In addition, the VA may authorize "any individual" to represent a particular veteran in connection with a particular claim. Id. § 5903(a). In both situations, the representatives may not charge for their services, and the representatives are subject to the same suspension provisions as authorized fee-charging representatives. Id. § 5902(b)(1)(A), (b)(2); id. § 5903(a)(1), (b); id. § 5904(b).
Minnesota has established a state Department of Veterans Affairs ("MVA") that, among other things, helps veterans obtain benefits from the VA. Minn. Stat. § 196.01 ; id. § 196.05, subd. 1. The MVA administers a "state soldiers' assistance fund" that is used for this purpose. Id. § 197.03. Under this program, veterans are usually referred to a federally approved veterans' organization for assistance, although in some cases veterans may be assisted by a county veterans service officer. Compl. ¶ 66; Minn. Stat. § 197.603, subd. 1.
In 2017, the Minnesota Legislature enacted the provisions that are challenged in this action. Those provisions are intended to ensure that, before a veteran pays someone to assist him or her in pursing a claim for benefits from the VA, the veteran is made aware that such assistance is available at no cost. Specifically, Minn. Stat. § 197.6091 provides, in relevant part:
Id. § 197.6091, subds. 2, 3. Failure to comply with these provisions subjects violators to a civil penalty of up to $1,000 per violation, with each day of a continuing violation constituting a separate violation. Id. § 197.6091, subd. 4.
A separate provision directs the MVA to develop a written disclosure statement for use by fee-charging representatives who seek to comply with § 197.6091, subd. 3. Id. § 196.05, subd. 1(12). Accordingly, the MVA has developed a one-page form that includes the following language:
Disclosure Notice
Please carefully read:
Veterans benefits services are offered at no cost by federally chartered Veteran Service Organizations, [by] the Minnesota Department of Veterans Affairs and by the Minnesota County Veteran Service Officers.
This disclosure notice is being provided to you pursuant to Minn. Stat. 197.6091
Compl. Ex. A. The form also includes MVA's contact information. Id.
Graham is a resident of Washington and is authorized to represent clients before the VA. Compl. ¶¶ 18, 20. Graham is not a licensed attorney in any state. Compl. ¶ 19. After the MVA promulgated the disclosure form pursuant to Minn. Stat. § 196.05, subd. 1(12), Graham decided that he would no longer accept clients from Minnesota. Compl. ¶ 60.
Jewell, Parham, and Gosha are veterans and residents of Minnesota. Compl. ¶¶ 2–3, 23–24, 29–30. Jewell, who served in the Marine Corps, recently pursued a claim with the VA concerning a reduction in her disability compensation. Compl. ¶¶ 3–5, 9–10.
Jewell was originally represented by a county veterans service officer, but her case was later referred to the American Legion. Compl. ¶¶ 5–6. Jewell was unhappy with the change and sought to retain a VA-authorized private attorney. Compl. ¶ 7. Every attorney she contacted declined to represent her on account of Minnesota's new disclosure requirements. Compl. ¶ 8. Although Jewell's benefits were later reinstated, she alleges that she incurred damages as a result of the reduction. Compl. ¶¶ 10–17.
Parham, who served in the Army, believes that his VA rating for a service-related medical condition is incorrect. Compl. ¶¶ 24–25. Parham completed the initial paperwork to appeal his rating and wants to retain a private attorney to represent him before the VA. Compl. ¶¶ 26–27. Parham contacted an attorney, but the attorney declined to represent him, explaining that he could not ethically make the statements required in the MVA disclosure form. Compl. ¶ 28.
Gosha, a Navy veteran, used the services of Disabled American Veterans to submit an application for disability compensation to the VA. Compl. ¶¶ 30–31. Gosha wants to retain a private practitioner to help him pursue that claim and possibly seek a discharge upgrade. Compl. ¶ 32. Gosha first contacted an attorney and then contacted Graham, but both declined to represent him because they objected to presenting the disclosure form required by Minnesota law. Compl. ¶¶ 33–34.
In reviewing a motion to dismiss for failure to state a claim under Fed. R. Civ. P. 12(b)(6), a court must accept as true all of the factual allegations in the complaint and draw all reasonable inferences in the plaintiff's favor. Perez v. Does 1–10 , 931 F.3d 641, 646 (8th Cir. 2019). Although the factual allegations need not be detailed, they must be sufficient to "raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). The complaint must "state a claim to relief that is plausible on its face." Id. at 570, 127 S.Ct. 1955.
Plaintiffs first allege that Minn. Stat. § 197.6091 and Minn. Stat. § 196.05, subd. 1(12), are impliedly preempted by the federal laws that govern the provision and administration of veterans' benefits. See generally 38 U.S.C. § 101 et seq. As described both at the hearing and below, the Court is inclined to agree with plaintiffs, but the Court has concluded that resolving this issue requires the development of a factual record and further briefing.
State law may be impliedly preempted in one of several ways. First, state law is...
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