Virginia Beach Policemen's Benev. Ass'n v. Reich

• Citation: 881 F. Supp. 1059
• Decision Date: 22 March 1995
• Docket Number: Civ. A. No. 2:93cv1170.
• Court: United States District Courts. 4th Circuit. United States District Court (Eastern District of Virginia)
• Parties: VIRGINIA BEACH POLICEMEN'S BENEVOLENT ASSOCIATION, Robert Mathieson and Michael F. Gelardi, Joint Trustees of the Centurion Health and Welfare Benefit Plan, Plaintiffs, v. Robert REICH, Secretary of the United States Department of Labor, United States Department of Labor, Defendants.

881 F. Supp. 1059

VIRGINIA BEACH POLICEMEN'S BENEVOLENT ASSOCIATION, Robert Mathieson and Michael F. Gelardi, Joint Trustees of the Centurion Health and Welfare Benefit Plan, Plaintiffs, v. Robert REICH, Secretary of the United States Department of Labor, United States Department of Labor, Defendants.

Civ. A. No. 2:93cv1170.

United States District Court, E.D. Virginia, Norfolk Division.

March 22, 1995.

COPYRIGHT MATERIAL OMITTED

Michael T. Leibig, Zwerdling, Paul, Leibig, Kahn, Thompson & Driesen, P.C., Fairfax, VA, for plaintiffs, Virginia Beach Policemen's Benev. Ass'n and Robert Mathieson.

Wyatt B. Durrette, Jr., Arnold C. Moore, Jr., Durrette, Irvin, Lemons & Bradshaw, Richmond, VA, for plaintiff Michael F. Gelardi.

Michael A. Rhine, Asst. U.S. Atty., Norfolk, VA, Alexander Fernandez, U.S. Dept. of Labor, Office of Sol., Washington, DC, for defendants.

OPINION AND FINAL ORDER

REBECCA BEACH SMITH, District Judge.

This matter comes before the Court on Plaintiffs' and Defendants' cross-motions for summary judgment. After oral argument from the parties, the case is ready for decision by the Court. For the reasons stated below, the Court GRANTS Defendants' motion for summary judgment and DENIES Plaintiffs' motions for summary judgment.

I. Factual and Procedural History

Plaintiff Virginia Beach Policemen's Benevolent Association ("PBA") is a labor union established to support Virginia Beach police officers. Plaintiffs Robert Mathieson and Michael Gelardi are joint trustees of the Centurion Health and Welfare Benefit Plan ("Centurion Plan"), which is an employee health benefit plan established by Ocean Breeze Festival Park, Inc. and PBA. In July of 1993, the Commonwealth of Virginia, by the State Corporation Commission, required the Centurion Plan to enter into a Consent Order with the Virginia Bureau of Insurance. Under the Consent Order, the Centurion Plan voluntarily agreed not to enroll any new participants with certain limited exceptions until it obtained a definitive Advisory Opinion from the United States Department of Labor that the Centurion Plan was a multiple employer welfare arrangement ("MEWA") established or maintained pursuant to a collective bargaining agreement under ERISA section 3(40)(A)(i).¹ The Centurion Plan seeks this Advisory Opinion in order to escape stringent state regulation.

On December 17, 1992, representatives of the Centurion Plan requested an Advisory Opinion from the Secretary of Labor. The Virginia Bureau of Insurance, in a separate letter, also conveyed the Centurion Plan's request to the Secretary. The Secretary, by Robert J. Doyle, Director of the Office of Regulations and Interpretations of the Welfare Benefits Administration, responded that the Department of Labor was not prepared to make a finding at that time. Doyle Decl. ¶ E.

Several months later, in June 1993, in response to a letter from Congressman Owen Pickett, the Department of Labor commented that it had decided not to rule on whether specific plans were established or maintained under collective bargaining agreements. More than a year later, in response to an inquiry from Senator Charles Robb, the Department of Labor added that it intended to develop regulations to address whether a particular plan was established or maintained pursuant to a collective bargaining agreement.² Since the Department's above responses, the Department of Labor formally announced its intention to publish a notice of proposed rulemaking in March of 1995.³ 59 Fed.Reg. 57,800 (Nov. 14, 1994) (Unified Agenda). Mr. Doyle, as representative of the Department of Labor, has attested to the Department of Labor's intent to promulgate these regulations. Doyle Decl. ¶ C.

On December 3, 1993, Plaintiffs PBA, Mathieson, and Gelardi as well as Ocean Breeze Festival Park, Inc. and the Centurion Health and Welfare Benefit Plan⁴ sued the United States Secretary of Labor, Robert Reich, and the United States Department of Labor in order to have the Secretary of Labor label the Centurion Plan as a plan established or maintained pursuant to a collective bargaining agreement under ERISA section 3(40)(A)(i).⁵ On February 11, 1994, Defendants moved to dismiss the original complaint based on lack of subject matter jurisdiction under Fed.R.Civ.P. 12(b)(1) and failure to state a claim under Fed.R.Civ.P. 12(b)(6). This Court addressed and granted that motion in Ocean Breeze Festival Park, Inc. v. Reich, 853 F.Supp. 906 (E.D.Va.1994).

Proper Plaintiffs PBA, Mathieson, and Gelardi subsequently filed an Amended Complaint in which they seek (1) a declaratory judgment that the Centurion Plan is established or maintained pursuant to a collective bargaining agreement; (2) a writ of mandamus ordering the Secretary of Labor to determine that the Centurion Plan is established or maintained pursuant to a collective bargaining agreement; and (3) a mandatory injunction that would require the Secretary of Labor to make the above determination. Defendants have moved to dismiss the Amended Complaint because they argue that Plaintiffs have neither a claim under the Administrative Procedure Act nor a mandamus remedy. According to Defendants, as result of Plaintiffs' lack of these two remedies, Plaintiffs cannot pursue declaratory relief. Because Plaintiffs have responded to Defendants' motion with additional materials and because Defendants have had ample opportunity to present matters outside the pleadings, the Court treats Defendants' motion to dismiss for failure to state a claim as a motion for summary judgment. Fed. R.Civ.P. 12(b).

In their motions for summary judgment, Plaintiffs claim that the Court has the power under the APA to compel the Secretary to make a determination, that a writ of mandamus is available, and that the Court should declare the Centurion Plan to be a plan established or maintained pursuant to a collective bargaining agreement. Defendants contest the ability of the Court to award any relief to Plaintiffs.⁶

II. Standard of Review

The court may grant summary judgment on an issue only when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). On a motion for summary judgment, the court reviews the record as a whole and in the light most favorable to the nonmoving party; "the evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 2521, 91 L.Ed.2d 202 (1986).

Plaintiffs PBA and Mathieson have submitted a "Statement of Facts Not in Dispute." The Court construes this statement as if it were a portion of Plaintiffs' brief in support of their motion for summary judgment. Defendants have stated several objections to Plaintiffs' characterization of the facts contained in the Statement of Facts Not in Dispute.

Although the Court need not address all the particulars of the statement, one of the objections raised by Defendants warrants attention. Defendants specifically object to paragraph 16, which states, "On January 19, 1993, representatives of Centurion met with the Department of Labor and were told by Department of Labor representatives that an appropriate opinion letter would be forthcoming." Whether the Department of Labor told Centurion Plan representatives that an Advisory Opinion would be forthcoming does not affect the Court's decision as to whether the Plaintiffs are entitled to such an opinion. The pleadings, affidavits, and exhibits before the Court indicate that the Secretary of Labor does not intend to give the Centurion Plan an individual Advisory Opinion. Doyle Decl. ¶ E. The documents before the Court also indicate that the Secretary has announced his intention to promulgate a regulation which would guide the determination of whether a MEWA falls under the collective bargaining agreement exception. Consequently, the material facts regarding the Secretary's position toward the Centurion Plan's request for an Advisory Opinion are uncontested. As a result, the Court resolves as a matter of law whether Plaintiffs have a right to injunctive, mandamus, or declaratory relief.

III. Discussion

A. Administrative Procedure Act

Plaintiffs contend that, under the APA, they are entitled to judicial review of the Secretary's refusal to issue an Advisory Opinion addressing whether the Centurion Plan is a plan established or maintained under a collective bargaining agreement. Generally, a party can obtain judicial review of agency action. See 5 U.S.C. § 702. Any person "adversely affected or aggrieved by agency action," is entitled to judicial review, as long as the action is a "final agency action for which there is no other adequate remedy in court." 5 U.S.C. §§ 702, 704.

Defendants maintain that judicial review is precluded both because the Secretary's failure to make a determination is not a "final agency action" and because the Secretary's issuance of a determination is a discretionary act not subject to judicial review. Under the APA, a court cannot engage in judicial review if the agency action is committed to agency discretion by law. 5 U.S.C. § 701(a)(2). The exception in 5 U.S.C. § 701(a)(2) applies if the statute is drawn so that a court would have no meaningful standard against which to judge the agency's exercise of discretion. Heckler v. Chaney, 470 U.S. 821, 830, 105 S.Ct. 1649, 1655, 84 L.Ed.2d 714 (1985). Only after a party clears the "final agency action" and "committed to agency discretion" hurdles of judicial review, may a reviewing court "compel agency action unlawfully withheld or unreasonably delayed." 5 U.S.C. § 706(1).

1. Final Agency Action

The parties disagree as to whether the Secretary has taken "final agency action" as defined under 5 U.S.C. section 704 for purposes of...