Justia Government & Administrative Law Opinion Summaries

An individual asserted interests in six oil leases that were proposed for inclusion in an oil exploration and development unit on Alaska’s North Slope. The Alaska Division of Oil and Gas initially approved two of these leases for unit inclusion but later reversed its position and denied inclusion for all six. During the administrative appeal process, the leases expired because the lessees failed to pay the required rental payments, as mandated by a Department of Natural Resources (DNR) regulation. The individual did not pay the rent necessary to reinstate the leases, and the Division confirmed their termination.The individual appealed both the termination of the leases and the denial of their inclusion in the unit to the Commissioner of Natural Resources. The Commissioner affirmed the terminations and denied the inclusion request. Separate appeals were filed in the Alaska Superior Court: one challenging the lease terminations (raising the validity of the rent-during-appeal regulation) and one challenging the denial of unit inclusion (alleging agency overreach, unreasonableness, and due process violations). The Superior Court affirmed the termination of five leases and remanded the sixth for further proceedings regarding its production capabilities. It also affirmed the denial of unit inclusion, finding no violation of due process or agency overreach.The Supreme Court of the State of Alaska held that the DNR regulation requiring rental payments during the pendency of an appeal is constitutional and a reasonable exercise of DNR’s authority. Because the lessees failed to pay rent, the terminations of five leases were affirmed, rendering the unitization appeal for those leases moot. The dispute over the sixth lease was found to remain live, but the Commissioner’s denial of its inclusion in the unit was affirmed as neither arbitrary, unreasonable, nor a violation of due process. The award of attorney’s fees against the appellant was also affirmed. View "Donkel v. State of Alaska" on Justia Law

A natural gas company operating in multiple states applied to the Federal Energy Regulatory Commission (FERC) for permission to build new pipeline facilities and abandon some existing ones, requesting that the costs of these improvements be included in future customer rates. The company’s customers, a group of retail natural gas distributors, challenged the application, arguing that less costly alternatives existed, that the improvements were not justified by customer needs, and that FERC should not pre-determine the rate treatment for the project. The core dispute arose when the customers requested access to specific pipeline flow data, designated as sensitive Critical Energy Infrastructure Information, which was withheld from the public docket. FERC eventually released the requested data, but the customers claimed that the delay impaired their ability to participate meaningfully in the proceedings.FERC granted the company’s application, issuing a Certificate of Public Convenience and Necessity and permitting facility abandonment. The Commission found that the evidence, including flow data, demonstrated the necessity of the project and justified the proposed rate treatment, noting that objections to rates could be addressed in future proceedings. The customers filed a rehearing request, alleging that FERC’s decision was premature and unsupported by substantial evidence due to delayed data access. FERC denied rehearing, later provided the requested data, and solicited comments, but the customers maintained that the timing was inadequate and refused to comment.The United States Court of Appeals for the District of Columbia Circuit reviewed the consolidated petitions. The court found the customers had standing, the case was not moot, and limited its review to arguments raised in the rehearing request. Applying the arbitrary and capricious standard, the court held that FERC’s procedures and consideration of the record, including flow data, were sufficient and did not violate due process. The petitions for review were denied. View "East Tennessee Group v. FERC" on Justia Law

The plaintiff, a former Senior Reimbursement Manager at a national pharmacy provider, alleged that her employer engaged in a scheme to overcharge government healthcare programs such as Medicare and Medicaid. She claimed the company exploited billing system discrepancies and other tactics to cause overpayments, including billing for deceased patients and miscoding pharmacy types for higher reimbursements. The company allegedly concealed these overpayments in its internal accounting and, after a period, transferred the unreturned funds into its own revenues. The plaintiff reported these practices to management and internal audit, but the issues persisted.After filing a complaint in the United States District Court for the Eastern District of New York, the plaintiff amended her allegations. The District Court dismissed all federal claims with prejudice, finding that the plaintiff did not meet the heightened pleading standards for fraud required under Federal Rule of Civil Procedure 9(b) for “direct” False Claims Act (FCA) claims (those based on submitting fraudulent invoices or statements to the government). The court also denied leave to further amend the complaint, and denied reconsideration.On appeal, the United States Court of Appeals for the Second Circuit reviewed the case de novo. The Second Circuit affirmed the District Court’s dismissal of the plaintiff’s direct FCA claims, holding that she did not identify any specific fraudulent submissions to the government, nor adequately allege that such information was solely within the defendants’ control. However, the Second Circuit vacated the dismissal of the “reverse” FCA claim, which is based on knowingly retaining government overpayments. The court found the plaintiff sufficiently alleged that the company had an obligation to return identified overpayments and knowingly concealed or improperly avoided that obligation. The case was remanded for further proceedings on the reverse FCA claim. View "United States v. Amerisource Bergen Corp." on Justia Law

A group of premium cigar manufacturers and trade associations challenged California’s Unflavored Tobacco List statute, which requires tobacco products to be approved and listed by the California Attorney General before they may be sold to consumers, retailers, or wholesalers in the state. To be listed, manufacturers must submit detailed applications and pay fees, certifying their products lack any characterizing flavor. The plaintiffs argued that the law would impose considerable compliance costs, particularly burdensome for the premium cigar industry where products are hand-made in smaller batches and change blends frequently. They asserted that their premium cigars, by federal definition, do not contain flavoring additives, and that the application and fee requirements would force them to reduce their product offerings in California.The plaintiffs sought a preliminary injunction against enforcement of the statute in the United States District Court for the Central District of California. They contended that the federal Family Smoking Prevention and Tobacco Control Act (TCA) expressly preempts California’s law as applied to premium cigars and that the statute’s presumption against flavoring based on manufacturers’ speech violates the First Amendment. The district court denied the motion, concluding the plaintiffs were unlikely to succeed on the merits of their claims.Upon review, the United States Court of Appeals for the Ninth Circuit affirmed the district court’s denial of a preliminary injunction. The appellate court held that the TCA’s Savings Clause exempts state requirements related to the sale of tobacco products from preemption, and the challenged statute falls within this exemption as it is directly tied to retail sales. The court also found that, based on the Attorney General’s representations, the statute imposes only a minimal burden on commercial speech and does not restrict speech more than necessary. Thus, the Ninth Circuit affirmed the denial of injunctive relief. View "ROCKY PATEL PREMIUM CIGARS, INC. V. BONTA" on Justia Law

Several federally licensed firearms dealers (FFLs), including both brick-and-mortar and home-based businesses, gun rights organizations, and private citizens challenged a California statute, Section 26806, which requires all FFLs to maintain a digital video and audio recording system on their business premises. The statute mandates 24/7 surveillance of specific areas, such as points of sale and firearm display areas, and limits when and how recordings may be released or accessed, including requirements for posting notification signs and annual certification of system functionality. Plaintiffs argued that this law infringed their rights under the First, Fourth, and Fifth Amendments by imposing surveillance burdens, chilling speech, violating privacy, and effecting a taking of property.The United States District Court for the Central District of California dismissed the complaint for failure to state a claim. The district court found that Plaintiffs had not sufficiently alleged a likelihood of success on the merits of any claims, denied injunctive relief, and granted leave to amend. Plaintiffs eventually chose not to further amend and requested final judgment, which the district court entered, leading to this appeal.The United States Court of Appeals for the Ninth Circuit affirmed the district court’s dismissal. The court held that Plaintiffs failed to allege a cognizable Fourth Amendment claim because there was no physical government intrusion or access to recordings, nor did mere compliance with the statute transform FFLs into state actors. The court also found no Fifth Amendment violation, as the statute did not result in a physical or regulatory taking; FFLs retained ownership and control over their recording systems, and the economic impact did not rise to a taking. Finally, the court ruled that the First Amendment theories advanced by Plaintiffs—overbreadth, violations of the right to anonymity and association, and chilling of speech—were unsupported because the statute did not regulate or compel speech or disclosure, nor did it plausibly chill protected expression. The Ninth Circuit therefore affirmed the district court’s judgment. View "RICHARDS V. NEWSOM" on Justia Law

A fourteen-year-old student, JPZ, was suspended from school following an altercation. The school principal, Melissa Arendts, notified JPZ's mother and requested JPZ be picked up. Upon arrival, JPZ's grandmother found him isolated and awaiting questioning by Scott Labish, a sheriff’s deputy serving as a school resource officer. Labish, in uniform, questioned JPZ, allegedly in a threatening manner, and told him about a “Three Strike” policy that would result in criminal prosecution and expulsion after another infraction. JPZ became distressed, left school, and subsequently died by suicide at home several hours later. JPZ's father, Brian Zimmermann, as administrator of JPZ’s estate, sued Arendts, Labish, the school district, and Macomb County, alleging federal due process violations and state law claims.The United States District Court for the Eastern District of Michigan dismissed the wrongful death claim but allowed four other claims to proceed: deprivation of substantive due process, conspiracy, intentional infliction of emotional distress, and Monell liability. Defendants moved to dismiss the remaining claims based on qualified and state governmental immunity and deficiencies in the Monell claim. The district court denied these motions in part, leading to an interlocutory appeal by the defendants.The United States Court of Appeals for the Sixth Circuit reviewed the district court’s denial de novo. The Sixth Circuit held that the facts did not support a substantive due process claim under the state-created danger doctrine, as the defendants neither increased JPZ’s risk of harm from a third party nor acted with deliberate indifference. The conspiracy and Monell claims failed because no underlying constitutional violation was adequately alleged. The court also found the defendants entitled to state governmental immunity for the intentional infliction of emotional distress claim, as the conduct alleged did not indicate malice. The Sixth Circuit reversed the district court’s denial of the motions to dismiss and remanded the case. View "Zimmermann v. Labish" on Justia Law

A business specializing in adult products sought to open a store in downtown Fargo, North Dakota, in a zone designated for mixed-use development. The proposed store intended to sell items such as lingerie and sexual wellness products, but not sexually explicit media like books or DVDs. To proceed, the business’s landlord applied for a change-of-use permit to allow retail sales and service at the location. The City of Fargo, through its Director of Planning and Development, denied the application, concluding that the business constituted an "Adult Bookstore" as defined by the city’s municipal code, which prohibited such establishments in the downtown zone. The city’s decision was upheld by both the Fargo Board of Adjustment and the Board of City Commissioners.Following these administrative decisions, the business filed suit in the United States District Court for the District of North Dakota, raising constitutional claims including violations of the First Amendment, the imposition of a prior restraint, denial of procedural due process, and unconstitutional vagueness in the city’s code. The business also challenged the Commissioners’ decision under state law, arguing it was arbitrary and capricious. While the lawsuit was pending, Fargo amended its code to explicitly prohibit “Sexual Device Shops” in the relevant zone.The United States Court of Appeals for the Eighth Circuit reviewed the case. The court affirmed the dismissal of all federal claims, holding that the business’s planned activities were not protected expressive conduct under the First Amendment, the permit process was not a prior restraint, and the business received adequate procedural process. The court also found the city’s ordinance was not unconstitutionally vague. However, the court determined that denying the permit as an “Adult Bookstore” was arbitrary and capricious under state law, reversed the dismissal of the state-law claim, and remanded for further proceedings regarding possible relief. View "Romantix-Fargo, Inc. v. City of Fargo" on Justia Law

A group of associations representing infusion centers, cancer patients, and pharmaceutical manufacturers challenged the constitutionality of a program created by the Inflation Reduction Act of 2022, which directs the Secretary of Health and Human Services (HHS), through the Centers for Medicare and Medicaid Services (CMS), to negotiate prices for high-expenditure prescription drugs under Medicare Parts B and D. The program allows HHS to select drugs based on certain criteria, negotiate a “maximum fair price” with manufacturers, and impose an excise tax on manufacturers who refuse to negotiate. The tax is calculated as a high percentage of sales reimbursed by Medicare. Manufacturers may avoid the program by withdrawing from Medicare and Medicaid participation. The statutory scheme also limits administrative and judicial review of key program decisions and allows HHS to implement early cycles of the program through guidance rather than notice-and-comment rulemaking.The United States District Court for the Western District of Texas initially dismissed the case for lack of subject-matter jurisdiction and improper venue. On appeal, the United States Court of Appeals for the Fifth Circuit reversed and remanded, finding that at least one plaintiff had standing and venue was proper. On remand, the district court granted summary judgment for the government, holding that the program did not violate the nondelegation doctrine, that the Anti-Injunction Act barred the plaintiffs’ Eighth Amendment claim, and that the plaintiffs lacked a protected property interest to support their due process claim.Upon further appeal, the United States Court of Appeals for the Fifth Circuit affirmed the district court’s judgment. The court held that the statute provided an “intelligible principle” sufficient to withstand a nondelegation challenge, that the Anti-Injunction Act did not bar the Eighth Amendment claim but the excise tax did not constitute a punitive fine, and that neither manufacturers, providers, nor patients possessed a protected property or liberty interest implicated by the program. The government’s summary judgment was affirmed in full. View "Natl Infusion Center v. Kennedy" on Justia Law

A California corporation that manufactures medical devices sought to connect two properties it owns, separated by a public street, into a single microgrid using its own private equipment. The microgrid would supplement its energy needs by drawing power from the local regulated utility when necessary. The company claimed it had obtained local approvals and that its microgrid complied with Public Utilities Code section 218, which defines when an entity is not considered a regulated "electrical corporation." However, Southern California Edison (SCE) declined to support the company’s plan, citing concerns about safety and operational control, and asserting that it had discretion to deny facility modifications or connections that could affect its distribution system.The California Public Utilities Commission (PUC) initiated a rulemaking process to develop a policy framework for microgrids, as mandated by Senate Bill No. 1339. In the fifth phase of this process, the PUC adopted tariffs for multi-property microgrids proposed by investor-owned utilities but declined to adopt the company’s proposed changes to SCE’s tariff rules. The PUC found that the company’s proposals could allow an unregulated entity to compel changes to, or control, regulated utility infrastructure, potentially compromising safety and reliability. The company’s application for rehearing was denied, with the PUC reiterating that the proposed rule changes conflicted with statutory requirements, including sections 218, 399.2, and 451.The California Court of Appeal, Fourth Appellate District, Division Three, reviewed the PUC’s decisions. The court held that the PUC had not abused its discretion, misinterpreted the statutes, or failed to proceed as required by law. It found that the PUC’s decisions were consistent with applicable law and legislative intent, particularly the priority given to safety and the requirement that regulated utilities maintain control over their distribution systems. The court affirmed the PUC’s decisions. View "Applied Medical Resources Corp. v. Public Utilities Commission" on Justia Law

A developer formed a company in 2006 and purchased property in the Town of West Yellowstone, Montana, intending to construct a 48-unit condominium project. The developer obtained a building permit and a “Will Serve Letter” from the Town, confirming that water, sewer, and storm drainage services would be provided. Construction began in 2007 but ceased in 2011, after which the building permit expired due to inactivity. The developer did not reapply for a permit, nor did it renew related approvals. In 2019, the Town adopted a resolution limiting new wastewater connections due to capacity concerns. In 2020, the developer attempted to sell the property, contingent on confirmation that service connections would still be honored. The Town responded that hookups would be permitted when capacity allowed but did not guarantee immediate service.The Eighteenth Judicial District Court, Gallatin County, denied the Town’s argument that the developer’s claims were time-barred under statutory limitations, ruling that the claims accrued only when the Town refused to guarantee connections in 2020. However, the District Court granted summary judgment for the Town on the merits, finding that the Will Serve Letter did not create an enforceable contract or vested right to service after years of inactivity and expired permits, and that the Town did not owe a special duty under the public duty doctrine.The Supreme Court of the State of Montana affirmed the District Court’s rulings. It held that the developer’s claims were timely but that, even assuming a contract existed, any right to service under the Will Serve Letter expired after a prolonged period of project inactivity and lapsed permits. The Court further held that the Town owed no special duty to the developer beyond its general obligations to the public, and summary judgment for the Town was appropriate. View "West Development, LLC v. Town of W. Yellowstone" on Justia Law