Justia Government & Administrative Law Opinion Summaries

A pharmaceutical company sought approval from the Food and Drug Administration (FDA) to market tasimelteon, a drug previously approved for a rare sleep disorder, as a treatment for jet lag. The company submitted results from several clinical trials, focusing on both objective sleep measures and subjective assessments of alertness and next-day functioning. The FDA’s Center for Drug Evaluation and Research issued a complete response letter indicating that the application did not provide substantial evidence of efficacy, particularly criticizing the measurement of next-day impairment and the tools used for subjective endpoints. The company engaged in further discussions and dispute resolution with the FDA, including proposing a narrower indication for approval, but these efforts were unsuccessful.After the FDA issued a formal notice of opportunity for a hearing (NOOH), the company requested a hearing and submitted expert declarations supporting the adequacy of its clinical evidence. The FDA ultimately denied both the application and the hearing request, finding no genuine and substantial issue of fact warranting a hearing. The company then petitioned the United States Court of Appeals for the District of Columbia Circuit for review, arguing that the FDA was required to hold a hearing, that material factual disputes existed, that the FDA’s decision-making was arbitrary and capricious, and that the final decision violated the Appointments Clause.The United States Court of Appeals for the District of Columbia Circuit held that the Food, Drug, and Cosmetic Act does not require the FDA to hold a hearing before denying every new drug application, but the agency must grant a hearing if there are material factual disputes. The court found that, in this case, the FDA’s refusal to hold a hearing was arbitrary and capricious because the company’s expert evidence created genuine disputes over the adequacy of the clinical trials. The court remanded the case to the FDA for further proceedings consistent with its opinion. View "Vanda Pharmaceuticals, Inc. v. FDA" on Justia Law

A hospital submitted its proposed budget for the upcoming fiscal year, requesting a 6.1% increase in net patient revenue (NPR) and a 2.8% increase in commercial negotiated rates. The hospital justified its request by citing increased patient volume and efforts to reduce wait times. The Green Mountain Care Board, which regulates hospital budgets in Vermont, had previously issued guidance setting a 3.5% benchmark for NPR growth and a 3.4% benchmark for commercial rate increases, requiring hospitals to justify any requests above these benchmarks.After reviewing the hospital’s proposal, the Green Mountain Care Board approved a 5.0% NPR increase—higher than the benchmark but lower than requested—citing the hospital’s strong financial health and the need to balance access to care with cost containment. The Board also approved the requested 2.8% commercial rate increase but included a footnote reducing this increase to 1.2% due to a prior budget overage, referencing a separate budget-enforcement order. The hospital appealed the Board’s decision to the Vermont Supreme Court, arguing that the Board’s NPR decision was arbitrary and that the reduction in the commercial rate increase violated procedural requirements under the Vermont Administrative Procedure Act (VAPA).The Vermont Supreme Court held that the Board had adequately explained its decision to approve a 5.0% NPR increase and acted within its discretion, given the statutory mandate to balance cost control and access to care. However, the Court struck the footnote reducing the commercial rate increase to 1.2%, because the underlying budget-enforcement order had been reversed by the Vermont Superior Court for failure to follow VAPA procedures and was no longer valid. The Supreme Court otherwise affirmed the Board’s decision. View "In re Rutland Regional Medical Center Fiscal Year 2025" on Justia Law

Several individuals who allegedly owed debts to Kentucky public institutions—either for medical services at the University of Kentucky or for educational services at the University of Kentucky, Morehead State University, or the Kentucky Community & Technical College System—challenged the referral of their debts to the Kentucky Department of Revenue for collection. The plaintiffs argued that the statutes used to justify these referrals did not apply to their debts and that the Department unlawfully collected the debts, sometimes without prior court judgments or adequate notice. The Department used its tax collection powers, including garnishments and liens, to recover these debts, and in some cases, added interest and collection fees.In the Franklin Circuit Court, the plaintiffs sought declaratory and monetary relief, including refunds of funds collected. The Circuit Court ruled that the Department was not authorized by statute to collect these debts and held that sovereign immunity did not protect the defendants from the plaintiffs’ claims. The court also certified the medical debt case as a class action. The Court of Appeals reviewed these interlocutory appeals and held that while sovereign immunity did not bar claims for purely declaratory relief, it did bar all claims for monetary relief, including those disguised as declaratory relief.The Supreme Court of Kentucky reviewed the consolidated appeals. It held that sovereign immunity does not bar claims for purely declaratory relief or for a refund of funds that were never due to the state, nor does it bar constitutional takings claims. However, the court held that sovereign immunity does bar claims for a refund of funds that were actually due to the state, even if those funds were unlawfully or improperly collected. The court affirmed in part, reversed in part, and remanded for further proceedings to determine which funds, if any, were never due to the state and thus subject to refund. The court also found that statutory changes rendered prospective declaratory relief in the medical debt case moot, but not retrospective relief. View "LONG V. COMMONWEALTH OF KENTUCKY" on Justia Law

Terri R. Winnon, a former executive assistant and controller for a group of skilled nursing facilities (SNFs) in Texas, alleged that her former employers and associated entities engaged in fraudulent schemes to obtain improper reimbursements from Medicare and Texas Medicaid. She claimed that the defendants paid unlawful kickbacks to doctors and hospital discharge planners for patient referrals and inflated therapy service bills to maximize government reimbursements. Winnon’s allegations included specific practices such as employee bonuses tied to Medicare census targets, “sham” medical directorships, and “marketing gifts” to hospital staff, as well as systematic upcoding of therapy services by a contracted provider, RehabCare.After Winnon filed her qui tam action under the False Claims Act (FCA) and related Texas statutes, the United States District Court for the District of Columbia dismissed her claims. The court found that her allegations against RehabCare were barred by the FCA’s public disclosure provision, as similar claims had already been made public in a prior lawsuit, United States ex rel. Halpin & Fahey v. Kindred Healthcare, Inc. The district court also determined that Winnon’s claims against the SNF Defendants did not meet the heightened pleading requirements of Federal Rule of Civil Procedure 9(b), as they lacked sufficient particularity regarding the alleged fraudulent conduct.On appeal, the United States Court of Appeals for the District of Columbia Circuit affirmed the district court’s dismissals. The appellate court held that Winnon’s claims against RehabCare were precluded by the public disclosure bar because her allegations were substantially similar to those previously disclosed and she did not qualify as an “original source” under the FCA. Regarding the SNF Defendants, the court concluded that Winnon’s allegations failed to satisfy Rule 9(b)’s requirement for particularity, as she did not provide enough specific details to support a strong inference that false claims were actually submitted. The court affirmed the district court’s judgments in full. View "USA v. Lozano" on Justia Law

A pharmaceutical company challenged the federal government’s implementation of a new program created by the Inflation Reduction Act of 2022, which authorizes the Centers for Medicare and Medicaid Services (CMS) to negotiate prices for certain high-expenditure prescription drugs under Medicare. The company’s drug was selected for the program, and it signed an agreement to participate “under protest” while filing suit. The company alleged that the program violated its constitutional rights under the First, Fifth, and Eighth Amendments, and that CMS failed to follow required notice-and-comment procedures under the Administrative Procedure Act (APA) when issuing the standard agreement for participation.The United States District Court for the District of Connecticut granted summary judgment to the government on all claims. The district court found that participation in the program was voluntary, so there was no unlawful deprivation of rights. It also held that the program did not impose unconstitutional conditions on participation in Medicare and Medicaid, and that the Inflation Reduction Act expressly allowed CMS to implement the program for its first three years without notice-and-comment rulemaking.The United States Court of Appeals for the Second Circuit reviewed the case and affirmed the district court’s judgment. The Second Circuit held that, under its precedent in Garelick v. Sullivan, participation in the Medicare Drug Price Negotiation Program is voluntary, and thus the program does not effect a taking, deprive the company of property without due process, or compel speech in violation of the First Amendment. The court further held that the program does not impose unconstitutional conditions because it is designed to control Medicare spending and does not regulate the company’s private market conduct. Finally, the court concluded that the Inflation Reduction Act expressly exempted CMS from the APA’s notice-and-comment requirement for the program’s initial years. View "Boehringer Ingelheim Pharms., Inc. v. Dep't of Health & Hum. Servs." on Justia Law

A Chinese manufacturer of electronic nicotine delivery systems (ENDS) sought authorization from the Food and Drug Administration (FDA) to market its refillable e-cigarette device in the United States. The device, sold without e-liquid, allows consumers to use a wide range of nicotine concentrations. The manufacturer submitted a premarket tobacco product application (PMTA) in August 2020, asserting that its product was appropriate for the protection of public health. After a preliminary assessment, the FDA identified deficiencies in the application and issued a deficiency letter in March 2023, requesting additional information. The manufacturer responded to some, but not all, of the deficiencies and requested an extension, which the FDA later denied. In January 2024, the FDA issued a final order denying the application, citing insufficient data to evaluate the product’s risks and benefits.The United States Court of Appeals for the Fifth Circuit reviewed the case after the manufacturer and a retailer based in Texas, who was also affected by the denial, petitioned for review. The court determined that venue was proper because the retailer had its principal place of business in the circuit. The petitioners argued that the FDA’s denial was arbitrary and capricious, claiming the agency failed to weigh the public health benefits of the product and improperly limited applicants to a single deficiency letter.The Fifth Circuit held that the FDA’s decision was reasonable and reasonably explained. The court found that the FDA had considered the potential benefits and risks of the product, explained the deficiencies in the application, and did not impose new evidentiary requirements without notice. The court also concluded that the FDA’s policy of issuing only one deficiency letter was adequately justified and not arbitrary. The petition for review was denied. View "Shenzhen Youme v. FDA" on Justia Law

A nonprofit substance abuse treatment facility in Kent, Connecticut, challenged the state’s approval of a competitor’s application to establish a similar facility in the same town. The competitor, Birch Hill Recovery Center, LLC, applied for a certificate of need from the Department of Public Health. The plaintiff was granted intervenor status in the administrative proceedings, allowing it to participate in hearings and present evidence. After public hearings, a hearing officer recommended denying Birch Hill’s application, but the Department and Birch Hill later entered into a settlement agreement that approved the application with certain conditions.The plaintiff appealed the Department’s decision to the Superior Court, arguing that the approval was an abuse of discretion, especially given the hearing officer’s earlier recommendation. The defendants moved to dismiss the appeal, contending that the plaintiff was not aggrieved by the decision and thus lacked standing. The Superior Court initially dismissed the appeal on the ground that the settlement agreement was not a final decision. The Appellate Court affirmed this dismissal. However, the Connecticut Supreme Court later held that the settlement agreement was a final decision and remanded the case for further proceedings. On remand, the Superior Court again dismissed the appeal, this time concluding that the plaintiff was not statutorily or classically aggrieved and therefore lacked standing.The Supreme Court of Connecticut affirmed the dismissal, holding that the plaintiff was neither statutorily nor classically aggrieved by the Department’s decision. The Court explained that mere economic competition resulting from governmental action does not confer standing in administrative appeals unless the relevant statute expressly protects competitors’ interests. The Court found that the applicable statute, General Statutes (Rev. to 2017) § 19a-639 (a), did not create such an exception. The plaintiff’s status as an intervenor and its participation in the administrative process did not, by themselves, establish a specific, personal, and legal interest sufficient for standing. View "High Watch Recovery Center, Inc. v. Dept. of Public Health" on Justia Law

A skilled nursing facility accepted a new resident who was receiving Medicaid benefits. The resident's husband was designated as her authorized representative. Nearly two years later, the Department of Human Services (DHS) terminated the resident's Medicaid benefits due to excess assets. Both the resident and her husband were incapacitated, and the resident's public guardian submitted a new Medicaid application, which was denied. The nursing facility continued to care for the resident without compensation until her death. The facility later sought an administrative hearing to challenge the eligibility decision, but the request was denied because the facility was not an authorized representative and the appeal was late.The circuit court and the Intermediate Court of Appeals (ICA) affirmed the denial, holding that the nursing home lacked standing to challenge the eligibility determination under Hawai'i Revised Statutes (HRS) § 346-12, which limits appeals to the applicant or recipient. The courts concluded that the nursing home did not have a close relationship with the resident for third-party standing purposes.The Supreme Court of the State of Hawai'i reviewed the case and disagreed with the lower courts regarding standing. The court held that skilled nursing facilities have constitutionally protected property interests in compensation for medical services performed for residents based on DHS eligibility determinations. The court ruled that these facilities have due process rights under the Hawai'i Constitution, including notice and the opportunity to appeal Medicaid eligibility determinations when the beneficiary is incapacitated and no authorized representative is available or willing to appeal. The court vacated the ICA's judgment and the circuit court's order, remanding the case for a new administrative hearing on the merits of the resident's Medicaid eligibility. View "In re FT" on Justia Law

Nikko Cerrone, a sixteen-year-old, received the Gardasil HPV vaccine, Flumist influenza vaccine, and Hepatitis A vaccine on October 7, 2015. He later reported decreased stamina and blood in his stools, leading to a diagnosis of ulcerative colitis (UC) in March 2016. He received a second HPV vaccine dose in February 2016 and a third in June 2016, with no documented reaction to the third dose.Cerrone filed a petition for compensation under the National Vaccine Injury Compensation Program, claiming the vaccines caused his UC. The Chief Special Master of the National Vaccine Injury Compensation Program denied his claim, finding that Cerrone failed to prove causation by a preponderance of the evidence. The Court of Federal Claims upheld this decision.The United States Court of Appeals for the Federal Circuit reviewed the case. The court affirmed the lower court's decision, agreeing that Cerrone did not meet the burden of proof required under the Vaccine Act. The court found that the special master correctly applied the legal standards and that the findings were not arbitrary or capricious. The court noted that the special master found the respondent's experts more credible and persuasive than Cerrone's experts. The court also upheld the special master's conclusion that the evidence did not support a proximate temporal relationship between the vaccinations and the onset of UC. The decision of the Court of Federal Claims was affirmed. View "CERRONE v. HHS " on Justia Law

M.R., an inmate serving a prison sentence for racketeering, experienced significant health issues, including balance problems and difficulty writing. In August 2020, he was diagnosed with a malignant brain tumor and underwent surgery in January 2021. By November 2022, M.R. was wheelchair-bound with residual neurological deficits. In February 2023, M.R. applied for compassionate release under the Compassionate Release Act (CRA). The New Jersey Department of Corrections (DOC) designated two physicians to review his medical records, who provided conflicting diagnoses regarding his terminal condition status. The DOC ultimately denied M.R. a Certificate of Eligibility for compassionate release.M.R. appealed the DOC's decision, and in August 2023, the Appellate Division remanded the case for reevaluation due to the conflicting medical opinions. The physicians provided updated reports, now uniformly concluding that M.R. did not suffer from a terminal condition or permanent physical incapacity, again relying solely on M.R.'s electronic medical records. The DOC reaffirmed its denial of the Certificate of Eligibility. The Appellate Division later affirmed the DOC's decision, concluding that the CRA does not require physical examinations and that the denial was not arbitrary, capricious, or unreasonable.The Supreme Court of New Jersey reviewed the case, focusing on whether the CRA and its implementing regulation require physical examinations for compassionate release applications. The Court held that the CRA does not mandate physical examinations for medical diagnoses. However, the Court found the DOC's decision to deny M.R. a Certificate of Eligibility in August 2023 to be arbitrary, capricious, and unreasonable. The Court emphasized the need for contemporaneous and comprehensive medical evaluations to support such decisions and reversed the Appellate Division's judgment. View "M.R. v. New Jersey Department of Corrections" on Justia Law