603 N.E.2d 1089 | Ohio Ct. App. | 1991
Lead Opinion
Plaintiffs-appellants, Upjohn Company ("Upjohn") and Angela Thomas, appeal from a judgment of the Court of Claims granting the motion to dismiss *829 of defendant-appellee, Ohio Department of Human Services ("ODHS"), as to all of Upjohn's claims and all of Thomas's claims except negligent processing.
Given the procedural posture of this case, we assume the factual allegations of plaintiffs' complaint to be true.
The Medicaid program established under Title XIX of the Social Security Act, Section 301, Title 42, U.S. Code, provides federal funds to reimburse states for medical assistance furnished to qualifying individuals based on medical and financial need. States receiving Medicaid funds may provide assistance to such individuals that differs in amount, scope, or duration based only on medical need. Section 1396a(a)(10)(B), Title 42, U.S.Code.
ODHS is authorized by R.C.
Ohio Adm. Code
Upjohn manufactures XANAX, an anti-anxiety drug of the chemical family benzodiazepene, which was listed in the formulary in 1985. Thomas is a Medicaid recipient whose stress-related disorder has been treated by her physician with XANAX since 1985. She was financially unable to obtain XANAX without assistance from the Medicaid program. Thomas's pharmacist was automatically reimbursed for filling her prescriptions for XANAX until ODHS removed XANAX from the formulary.
The Director of ODHS promulgated an amendment to Ohio Adm. Code
Plaintiffs brought suit seeking injunctive and declaratory relief, as well as damages, based upon constitutional claims arising from removal of XANAX from the formulary. They alleged that removal of XANAX from the formulary violated the Supremacy Clause of the United States Constitution because differential treatment of similarly situated Medicaid recipients was based on cost rather than medical need; and that removal of XANAX from the formulary violated both the due process and equal protection provisions of the United States and Ohio Constitutions because the decision to remove XANAX was irrational and unreasonable. They also brought damages claims arising out of ODHS's alleged negligence in removing XANAX from the formulary; and Thomas brought a damages claim for alleged negligence in processing prior authorization requests. Plaintiffs also sought certification of a class action whose class members consisted of Medicaid recipients injured by ODHS's negligence, with Thomas as class representative.
On April 9, 1990, the Court of Claims in part granted ODHS's motion to dismiss the amended complaint, determining that the court had no jurisdiction to hear claims for declaratory and injunctive relief or for constitutional violations, and that the allegation that ODHS was negligent in removing XANAX from the formulary did not state a claim upon which relief could be granted. In an amended entry filed April 20, 1990, the Court of Claims dismissed all of Upjohn's claims and all of Thomas's damages claims except her claim for negligent processing of her prior authorization request. The court overruled plaintiffs' motion to certify a class consisting of persons injured by ODHS's negligent removal of XANAX from the formulary and reserved decision on the motion to certify a class consisting of persons injured as a result of negligent processing of prior authorization requests.
Plaintiffs appeal, assigning the following errors:
"1. The Court of Claims erred in ruling that it did not have jurisdiction over plaintiffs' claims for injunctive and declaratory relief and in dismissing those claims.
"2. The Court of Claims erred in ruling that it did not have jurisdiction to decide plaintiffs' claims for damages arising under the Ohio Constitution and the United States Constitution and in dismissing those claims.
"3. The Court of Claims erred in ruling that it did not have jurisdiction to decide plaintiffs' claims for injunctive relief arising under the Ohio Constitution and the United States Constitution and in dismissing those claims. *831
"4. The Court of Claims erred in dismissing plaintiffs' claim for damages resulting from defendant's negligent removal of XANAX from the Ohio Medicaid Drug Formulary.
"5. The Court of Claims erred in overruling plaintiffs' motion to certify a class of all persons who were injured as a result of defendant's negligent removal of XANAX from the Ohio Medicaid Drug Formulary."
As a threshold matter, we must determine whether the order of the Court of Claims, which did not adjudicate all of the claims of all of the parties, is a final appealable order, because we lack jurisdiction to review an order that is not final and appealable. Chef Italiano Corp. v. Kent State Univ. (1989),
An order that adjudicates one or more but fewer than all of the claims of a party is final and appealable if it satisfies the requirements of both R.C.
Under R.C.
As to the first requirement of R.C.
Moreover, although Thomas potentially could recover money damages on her remaining claim for negligent processing of her prior authorization request, the order of the Court of Claims precludes both Upjohn and Thomas from obtaining any relief based on ODHS's improper removal of XANAX from the formulary. Because the order determines an entire claim arising out of the same set of facts and prevents a judgment in plaintiffs' favor on this claim, the dismissal of all of plaintiffs' claims arising out of the removal of XANAX from the formulary is a final order.
Finding the trial court's order to be final and appealable, we address plaintiffs' assigned errors.
Plaintiffs' first four assignments of error assert basically two points: (1) that the trial court erred in finding it lacked jurisdiction over plaintiffs' damages claims as well as their claims for declaratory and injunctive relief, and (2) that the trial court erred in determining that plaintiffs' claims for damages failed to state a claim for relief. Inasmuch as lack of jurisdiction and failure to state a claim are somewhat interrelated in connection with the Court of Claims, seeNacelle Land Mgt. Corp. v. Ohio Dept. of Natural Resources
(1989),
Examining first plaintiffs' claims for damages, we note that, pursuant to R.C.
"The state hereby waives its immunity from liability and consents to be sued, and have its liability determined, in the court of claims created in this chapter in accordance with the same rules of law applicable to suits between private parties * * *."
The Supreme Court in Reynolds v. State (1984),
R.C.
"(1) Specific attributes and/or benefits of the drug.
"(2) Availability and cost-effectiveness of the drug in relation to alternative products.
"(3) Availability of bioequivalent generic products."
Consideration of such factors, especially in relation to a particular alternative, involves the exercise of official judgment and discretion, see Winwood v. Dayton (1988),
We disagree with plaintiffs' contention that the only policy decision herein was ODHS's decision to reduce the costs of drugs for Medicaid recipients, and that removal of XANAX from the formulary merely implemented ODHS's decision to reduce these costs. ODHS's decision to remove certain antianxiety drugs from the formulary as the means to achieve its cost-savings objective represented a choice among policy alternatives; thus, pursuant to Garland v. Ohio Dept. of Transp. (1990),
In short, removal of XANAX from the formulary was an executive policymaking function involving the exercise of a high degree of official judgment and discretion. Consequently, plaintiffs cannot maintain a claim for money damages against the state in the Court of Claims arising out of ODHS's removal of XANAX from the formulary, whether the court be deemed to lack jurisdiction under Reynolds or plaintiffs' complaint be deemed not to state a claim outside the scope of the state's immunity under R.C.
We next address plaintiffs' contention that the Court of Claims erred in dismissing their claims for declaratory and injunctive relief for lack of subject-matter jurisdiction. R.C.
"(1) * * * The court of claims is a court of record and has exclusive, original jurisdiction of all civil actions against the state permitted by the waiver of immunity contained in section
"(2) If the claimant in a civil action as described in division (A)(1) of this section also files a claim for a declaratory judgment, injunctive relief, or other equitable relief against the state that arises out of the same circumstances that gave rise to the civil action described in division (A)(1) of this section, the *834 court of claims has exclusive, original jurisdiction to hear and determine that claim in that civil action. * * *"
As to the first of these, the Court of Claims Act and the state's waiver of immunity therein do not apply to actions against the state to the extent that the state, as defined by R.C.
The state had consented to declaratory actions against state agencies in the court of common pleas to determine the validity of administrative rules before the Court of Claims Act was adopted in 1975. See, e.g., Burger Brewing Co. v. Ohio LiquorControl Comm. (1973),
Because the state had consented to suit upon such claims before adoption of the Court of Claims Act, plaintiffs' claims for declaratory and injunctive relief are not claims permitted by the state's waiver of immunity. Berke v. Ohio Dept. of Pub.Welfare (1976),
Although plaintiffs' claims for declaratory and injunctive relief are not permitted by the state's waiver of immunity, the Court of Claims nevertheless has jurisdiction over these claims under R.C.
Arguably, R.C.
Plaintiffs apparently assert a somewhat different interpretation of R.C.
While plaintiffs' claims for declaratory and injunctive relief arise out of the same circumstances as plaintiffs' claims against the state for money damages, again, we have determined that plaintiffs' money damages claims at issue in this appeal fail to set forth a claim allowed by the state's waiver of immunity, i.e., the state's decision on which plaintiffs predicate their claim for money damages is immune from liability under Reynolds, supra. Hence, even under plaintiffs' asserted interpretation of R.C.
The purpose of R.C.
As a result, to the extent R.C.
While the Court of Claims delineated reasons other than those set forth above in dismissing plaintiffs' claim, to the extent the Court of Claims erred, we find no prejudicial error in the court's actions given our resolution of plaintiffs' assigned errors. Accordingly, we overrule plaintiffs' first, second, third, and fourth assignments of error. *836
Plaintiffs' fifth assignment of error asserts that the Court of Claims erred in refusing to certify a class action consisting of "all Medicaid recipients whose prescriptions for XANAX or other benzodiazepenes have not been filled or have been delayed in being filled as a result of the removal of XANAX and other benzodiazepenes from the Ohio Medicaid Drug Formulary." Denial of class certification is a final appealable order, Roemisch v.Mut. of Omaha Ins. Co. (1974),
The Court of Claims did not deny class certification because plaintiffs failed to satisfy the requirements for certification set forth in Civ.R. 23. Rather, the Court of Claims concluded that certification of a class defined in terms of harm incurred "as a result of the removal of XANAX" from the formulary was inappropriate because the court lacked jurisdiction over claims for such harm.
Having determined that plaintiffs cannot maintain their claims in the Court of Claims, the trial court did not err in refusing to certify a class action based on these claims. Consequently, we overrule plaintiffs' fifth assignment of error.
Having overruled all of plaintiffs' assignments of error, we affirm the decision of the Court of Claims.
Judgment affirmed.
JOHN C. YOUNG, J., concurs.
WHITESIDE, J., dissents.
Dissenting Opinion
To the extent that the majority opinion holds that the Court of Claims has no jurisdiction to entertain injunctive and declaratory relief in the Court of Claims in reliance uponRacing Guild of Ohio, Local 304 v. State Racing Comm. (1986),
Paragraph one of the syllabus of Racing Guild reads as follows:
"An action for injunctive relief may be brought against the state, as defined in R.C.
Confusion had been created by the Brownfield case, partly overruled by Racing Guild, from a statement at 283-284, 17 O.O.3d at 182,
"* * * Appellants have not referred this court to any statute, nor has independent research disclosed one, authorizing the maintenance of an injunctive action directly against the state of Ohio in a Court of Common Pleas. We do not believe that the state has consented to such a suit in that forum. For this reason, we hereby dismiss the state of Ohio as a party to this cause." (Emphasis added; footnotes omitted.)
Both the Brownfield and Racing Guild decisions are reconcilable if the provisions of prior case law and the present statute are analyzed and properly applied. In this regard, we must note that Racing Guild overruled Brownfield only to the extent that there was an inconsistency without elucidating as to the nature of the inconsistency. In waiving the state's immunity to suit and consenting to actions being brought in the Court of Claims against the state, R.C.
"`State' means the state of Ohio, including, without limitation, its departments, boards, offices, commissions, agencies, institutions, and other instrumentalities. It does not include political subdivisions."
Under case law prior to the adoption of R.C. Chapter 2743, a distinction was sometimes made between state officers and the state itself. This distinction is well set forth in State exrel. Williams v. Glander (1947),
"In 49 American Jurisprudence, 304, Section 92, it is said:
"`While a suit against state officials is not necessarily a suit against the state, within the rule of immunity of the state from suit without its consent, that rule cannot be evaded by bringing an action nominally against a state officer or a state board, commission, or department in his or its official capacity when the real claim is against the state itself, and the state is the party vitally interested. If the rights of the state would be directly and adversely affected by the judgment or decree sought, the state is a necessary party defendant, and if it cannot be made a party, that is, if it has not consented to be sued, the suit is not maintainable. * * *'" *838
The fourth paragraph of the syllabus of Am. Life Acc. Ins.Co. reads as follows:
"An action against the administrator of a state bureau for a declaratory judgment pronouncing the rights, status or other legal relations of the plaintiff with reference to a statute is not an action against the state, even though other incidental relief is granted."
Accordingly, the syllabus of Racing Guild must be read in light of the prior court decisions. Prior decisions authorized "or consented" to suits against state officers and agencies in declaratory judgment and injunction, but not against the state itself. Thus, the opinion of Racing Guild holds that, to the extent that prior case law permitted suits against the state as defined by R.C.
This court has repeatedly attempted to make this distinction commencing with State ex rel. Ferguson v. Shoemaker (1975),
"A direct action on a contract with the state, seeking monetary relief from the state, must be commenced and prosecuted in the Court of Claims and cannot be brought in the Court of Common Pleas. However, where appropriate, injunctive relief may be sought against a state officer, even though it involves a state contract, and the action for such relief may be brought in the Court of Common Pleas. * * *"
We noted that not all cases against state officers are actions against the state itself barred by the former doctrine of sovereign immunity noting in particular that mandamus will lie and is not considered an action against the state, citingState ex rel. Nichols v. Gregory (1935),
"Although the action in the Court of Common Pleas sought to be prohibited is in injunction rather than mandamus, the same principles apply. An action brought in a Court of Common Pleas for an injunction against a state officer is not per se precluded by R.C. Chapter 2743, creating and vesting jurisdiction in the Court of Claims; such an action may be proper irrespective of the doctrine of sovereign immunity. * * *"
On the other hand, in A.F.S.C.M.E. v. Blue Cross of CentralOhio (1979),
"Defendants argue that plaintiffs' complaint is an action against officers of the state rather than the state of Ohio. The cases cited by defendants are all cases in which employees or officers of the state, not the state of Ohio, were the parties. They are cases involving actions to enjoin an employee or officer of the state from performing some act or to require him to perform an act. The fact that the state consented to permit its officers and employees to be sued in the Court of Common Pleas in those cases does not mean the state consented to itself be sued in those cases. * * *"
We considered this same issue in Plastic Surgery Associates,Inc. v. Ratchford (1982),
"Prior to the consent of the state itself to be sued, it was generally recognized that state officers and agencies were subject to actions in injunction, mandatory injunction, mandamus and declaratory judgment so long as direct relief was not sought against the state but, instead, the remedy sought was to compel the officer or agency to perform a duty enjoined by law. Thus, declaratory judgment actions could be brought against state agencies, but the state itself could not be a party to such action. * * *"
We further expressly found, however, where direct relief is sought against the state itself, rather than merely against a state officer or agency, the Court of Claims does have jurisdiction of an action for declaratory and injunctive relief predicated upon action or inaction of a state officer or agency. This conclusion is consistent with Racing Guild, since RacingGuild found merely that, to the extent an action was previously authorized against the "state" as defined by R.C.
Racing Guild did not purport to determine the jurisdiction of the Court of Claims and, consistent with Racing Guild, to the extent that prior case law did not permit an action in declaratory judgment or injunction to be brought against the "state" as defined in R.C.
We further attempted to clarify the issue in State ex rel.Polaroid Corp. v. Denihan (1986),
"* * * We know of no case holding that an action in injunction may not be brought in a common pleas court to prevent a state officer from committing an illegal act. Under such circumstances, the state's interests are advanced by the person bringing the action rather than the state official. There is no reason to bring the action against the state itself since the state officer, by attempting to perform an illegal act, is acting contrary to the state's interests. Only when the real party in interest is the state itself, rather than the state officer, is an action brought against a state officer, whether in injunction or declaratory judgment, deemed to be an action against the state and, thus, required to be brought in the Court of Claims. See West Park Shopping Center v. Masheter (1966),
In Polaroid, we distinguished Friedman v. Johnson (1985),
"In the present case appellees sought injunctive, declaratory, and other necessary and proper relief. Further, the court of appeals remanded the cause for determination of damages. We must determine whether the court of common pleas has concurrent jurisdiction over this case, or whether the Court of Claims has exclusive subject matter jurisdiction.
"To begin, it is beyond dispute that this is a suit against the state. R.C.
"It is also clear that had appellees sued solely for declaratory relief the court of common pleas would have jurisdiction. The state had consented to declaratory judgment suits prior to 1975. * * * However, appellees attached a prayer for injunctive relief as well and, further, the cause has been remanded for a determination of damages. Standing alone, each of the latter two requests is within the exclusive, original jurisdiction of the Court of Claims." (Citations omitted.)
The issue is compounded by the dual definition of "state" in R.C.
Since I find that the Court of Claims has jurisdiction over the claims for declaratory judgment and injunction, it necessarily follows that the judgment should be reversed and the cause remanded to that court for further consideration. We reached a similar conclusion in Richard v. Ohio Dept. of LiquorControl (1986),