Callahan v. United States Department of Health and Human Services
1:19-cv-01783
N.D. Ga.Jan 16, 2020Background
- Plaintiffs (four transplant candidates and fourteen transplant centers) sued HHS and UNOS challenging adoption and HHS approval of the OPTN’s “Acuity Circles” liver-allocation policy, seeking a preliminary injunction and APA and Due Process relief.
- NOTA requires HHS to contract for a private OPTN to develop allocation policies; regulations (Final Rule) set procedural (§121.4) and substantive (§121.8) criteria and provide for Secretary review of critical comments.
- UNOS (as OPTN) adopted a 2017 revised policy and later (Dec. 2018) the Acuity Circles model (concentric 150/250/500 nm priorities); HHS issued a July 31, 2018 letter directing OPTN to eliminate reliance on DSAs/Regions and later approved Acuity Circles in Dec. 2018 and declined to set it aside in Apr. 2019.
- Plaintiffs asserted UNOS is an agency (so its action is reviewable), alleged procedural defects and bad faith in the policy process, and argued Acuity Circles violates the Final Rule and deprived patients of due process; the Eleventh Circuit remanded several threshold factual questions.
- The district court (Totenberg, J.) held (1) OPTN/UNOS is not an "agency" under the APA, (2) several HHS letters (July 2018, Dec. 2018, Apr. 2019) qualify as final agency actions, (3) record supplementation limited but some UNOS materials were included, and (4) on the merits HHS’s actions and the Acuity Circles policy were not arbitrary and capricious; plaintiffs’ preliminary injunction denied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether UNOS/OPTN is an "agency" under the APA | UNOS functions with substantial governmental authority (policy-making, monitoring, coercive effect via Medicare/Medicaid leverage); thus reviewable | NOTA contemplates a private nonprofit OPTN; HHS oversight and the Secretary’s role mean UNOS is not an independent agency | OPTN/UNOS is not an APA "agency" (court follows statutory structure and HHS’s longstanding interpretation) |
| What is the final agency action(s) for APA review | Plaintiffs: HHS’s July 2018 directive, Dec. 2018 approval, and Apr. 2019 refusal to act are reviewable final actions | HHS: only Apr. 2019 letter is the final action | Court: July 2018, Dec. 2018, and Apr. 2019 letters are final agency actions (all reviewable) |
| Adequacy of administrative record / supplementation | Plaintiffs sought many UNOS internal documents (bad-faith evidence) to be part of the record | HHS: record limited to what HHS considered; sister-agency/contractor materials need not be included absent bad faith | Court: limited supplementation granted; UNOS materials that indirectly influenced HHS properly included, but many predecisional deliberative UNOS communications remain outside administrative record for APA review (though available in court record) |
| Whether HHS/OPTN adoption of Acuity Circles was arbitrary & capricious under the APA | Plaintiffs: process was rushed, comment handling flawed, predetermination/bad faith and the policy ignores transition protections, transport/waste, and socioeconomic impacts | Defendants: process complied with Final Rule, modeled data (SRTR) supported policy, HHS reasonably set aside DSAs/Regions and relied on OPTN expertise | Court: HHS and OPTN did not act arbitrarily or capriciously; HHS permissibly set aside 2017 policy, the Acuity Circles adoption (despite procedural friction and rushed timeline) was rational and within agency discretion |
| Due Process (state-action and deprivation) | Patients: waiting-list expectancy is a life interest; adoption without more process deprived them of constitutionally adequate procedures | Defendants: OPTN is private (or no state action); Final Rule notice/comment satisfied process; no protected property/life interest in an untransplanted organ | Court: assuming state action, final rule notice/comment satisfied due process; plaintiffs failed to show constitutionally inadequate procedure; claim fails |
Key Cases Cited
- Callahan v. United States Dep’t of Health & Human Servs., 939 F.3d 1251 (11th Cir. 2019) (remanded threshold questions about UNOS/OPTN status and mandated further fact-finding)
- SEC v. Chenery Corp., 318 U.S. 80 (1943) (agency action based on an erroneous legal premise may require remand; courts cannot supply a post hoc rationale)
- Dep’t of Commerce v. New York, 139 S. Ct. 2551 (2019) (limitations on judicial inquiry into agency motivation and reliance on unstated considerations)
- Motor Vehicle Mfrs. Ass’n v. State Farm, 463 U.S. 29 (1983) (arbitrary-and-capricious standard requires agencies to examine relevant data and articulate a satisfactory explanation)
- Vermont Yankee Nuclear Power Corp. v. Natural Res. Def. Council, 435 U.S. 519 (1978) (courts should not impose extra procedural requirements on agencies beyond those required by law)
- Dong v. Smithsonian Inst., 125 F.3d 877 (D.C. Cir. 1997) (entity lacking substantial governmental authority is not an "agency" under the APA)
- Public Citizen Health Research Group v. Dep’t of Health, Ed. & Welfare, 668 F.2d 537 (D.C. Cir. 1981) (contracted organizations performing governmental tasks are not necessarily agencies; statutory structure and delegated authority matter)