Justia U.S. D.C. Circuit Court of Appeals Opinion Summaries

The DC Circuit denied a petition for review brought by three electrical transmission companies (Transcos), subsidiaries of the same parent company, challenging FERC's decision to reduce the enhanced return on equity FERC had previously authorized them to collect from ratepayers due to their status as standalone transmission companies.The court rejected ITC's contention that FERC arbitrarily and capriciously departed from precedent establishing a particular methodology to assess Transco independence. The court explained that FERC, consistent with its stated intent in Order No. 679, never established any definitive methodology, let alone the one ITC claims it did. In this case, FERC has consistently applied a case-by-case approach to determining Transco independence, considering ownership and business structure as part of that inquiry since it first granted a Transco adder in 2003. When the adder was codified in 2006, Order No. 679 built on prior practice by identifying certain criteria that ITC now mistakenly claims constitute "a new corporate-structure test." The court also rejected ITC's contention that FERC exceeded its statutory authority by reducing ITC's Transco adders without first finding the adders to be unjust and unreasonable. Rather, the court concluded that there was substantial evidence to support FERC’s finding that the merger had reduced ITC's independence, thereby rendering the existing adders unjust and unreasonable. View "International Transmission Co. v. Federal Energy Regulatory Commission" on Justia Law

The DC Circuit affirmed the district court's grant of summary judgment to the District in an action brought under Title VII of the Civil Rights Act of 1964 by plaintiff, alleging that OAG's denial of her multiple requests for a lateral transfer to a different unit within OAG constituted unlawful sex discrimination and unlawful retaliation for filing discriminatory charges with the EEOC. The court agreed with the district court that plaintiff failed to establish that she suffered an adverse employment action. In this case, no reasonable jury could conclude that plaintiff suffered materially adverse consequences associated with the denial of her lateral transfer requests for purposes of her discrimination or retaliation claim. View "Chambers v. District of Columbia" on Justia Law

Employer petitioned for review of NLRB orders which concluded, among other things, that employer had committed an unfair labor practice (ULP) by withdrawing recognition from its employees' union based on a petition signed by a majority of the bargaining unit members seeking a withdrawal of recognition. The Board considered the withdrawal of recognition unfair because of a later petition circulated by the union to the opposite effect, which the union had not disclosed to the employer at the time of the withdrawal of recognition.The DC Circuit concluded that the Board's refusal to retroactively apply Johnson Controls, 368 NLRB No. 20, a Board precedent ruling that employers engaging in the same conduct under similar circumstances do not commit unfair labor practices, was arbitrary and capricious. The court explained that the Board has clearly departed from its prior established precedent by not applying the Johnson Controls standard retroactively to this case—Johnson Controls and this case are factually indistinguishable. Accordingly, the court granted the employer's petition and denied the Board's cross-application for enforcement of its orders. Finally, the court concluded that substantial evidence supports the Board's finding that the Human Resources Manager for employer did not direct a newly-hired bargaining unit employee to another unit employee to have the new-hire sign the petition. Accordingly, the court denied the petition as to this issue. View "Leggett & Platt, Inc. v. National Labor Relations Board" on Justia Law

The DC Circuit held that the district court lacked subject matter jurisdiction over plaintiff's challenge to a reduction in Medicare drug reimbursement rates caused by a sequestration order under the Balanced Budget Act. The court explained that the Balanced Budget Act creates neither subject matter jurisdiction nor a cause of action that covers the claims. Therefore, the district court properly declined to convene a three-judge court. In any event, the claims also arise under the Medicare Act, which is enough to strip away federal question jurisdiction. Finally, because Community Oncology did not identify any concrete reimbursement claim that its members presented to the agency, 42 U.S.C. 405(g) does not confer subject-matter jurisdiction. View "Community Oncology Alliance, Inc. v. Office of Management and Budget" on Justia Law

Plaintiff, who holds the RIOT ACT trademark, entered into a business agreement with defendants to open the Riot Act Comedy Club in downtown D.C. Plaintiff subsequently filed suit to recover damages from defendants' alleged breaches of fiduciary duty and of the operating agreement of the limited liability company the parties formed to start the club. Defendants counterclaimed.The DC Circuit reversed the district court's dismissal of plaintiff's breach of fiduciary duty claim, holding that plaintiff adequately alleged that he and defendants were members of a member-managed LLC and that under D.C. law that suffices to plead the existence of a fiduciary duty. In this case, the district court improperly found it "clear" that a "special confidential relationship transcending an ordinary business transaction did not take place" between the parties. The court explained that the district court failed to consider relevant District of Columbia and Maryland law, the statute's clear imposition of duties of loyalty and care typical of a fiduciary, or the nature of the parties' relationship—as partners and co-managers in a business venture, not merely arms-length parties to a standard commercial transaction. However, plaintiff failed to show that the court should reverse any of the district court's evidentiary rulings. The court affirmed the district court's decision to deny defendants judgment as a matter of law on plaintiff's breach of contract claim and to deny defendants' fee petition. The court remanded for further proceedings. View "Xereas v. Heiss" on Justia Law

The DC Circuit granted petitions for review asking the court to set aside the Department's decisions imposing sanctions on petitioners for violating the Horse Protection Act. The Supreme Court subsequently decided Lucia v. SEC, 138 S. Ct. 2044 (2018), holding that the SEC's ALJs had not been appointed in compliance with the Appointments Clause. In light of Lucia, the government agrees with petitioners that the ALJ who presided over petitioners' cases was improperly appointed, and moved for vacatur of the challenged orders. Petitioners oppose the government's motion, seeking to address a number of additional challenges in advance.In regard to petitioners' argument that the dual layers of for-cause-removal protections for the Department's ALJs unconstitutionally limit the President's removal power under Free Enterprise Fund v. PCAOB, 561 U.S. 477, 492 (2010), the court concluded that petitioners have forfeited their argument by failing to raise it before the ALJ or Judicial Officer, and thus the argument is subject to a mandatory, non-excusable, issue-exhaustion requirement imposed by statute. The court concluded that petitioners preserved the remainder of their claims before the agency, but they fare no better in terms of obtaining additional relief from the court at this time. View "Fleming v. United States Department of Agriculture" on Justia Law

The DC Circuit reversed the district court's grant of summary judgment for the government in an action brought by the government seeking to collect a settlement against defendant. The court first rejected defendant's claim that the settlement contract is unenforceable because the parties omitted essential terms.In regard to defendant's claim that the district court should have granted him summary judgment because the government brought its suit too late, the court concluded that there is a material and disputed question of fact regarding performance that the district court should resolve after a bench trial. In this case, the government had six years to sue for breach of contract; the government filed suit in April 2016; and, if defendant breached the contract before April 2010, then the government's suit was untimely. Accordingly, the court remanded for further proceedings. View "United States v. Greer" on Justia Law

When Medicare overpays hospitals, it offsets that mistake by reducing future payments. By 2013, Medicare was out $11 billion because of new diagnostic codes and bookkeeping that did not keep up. Congress required that the Secretary of Health and Human Services recoup that amount by the end of fiscal year 2017 by reducing the base rate (standardized amount) paid for inpatient care and directed the Secretary to adjust the base rate by 0.5% each year through 2023, 129 Stat. 87, 163 (2015). Subsequently, while reviewing the 2017 budget, the Secretary realized that a -3.2% adjustment would leave the agency short of its $11 billion goal and announced a -3.9% adjustment. Congress then told the Secretary to increase the base rate by 0.4588% (not 0.5%) in 2018, 130 Stat. 1033, 1320 (2016). In 2017, the Secretary adjusted the base rate -3.9%. The agency met its goal. In 2018, the Secretary adjusted the base rate -3.4412%.Medicare providers sued, arguing that the Secretary should have reversed that expedient at the end of 2017 rather than carry it over into 2018, costing the hospitals $840 million in lost payments. The D.C. Circuit affirmed the dismissal of the suit. While the hospitals felt a “significant financial impact” from the -0.7% adjustment, Section 7(b)(5) bars judicial review of adjustments made under the Act. View "Fresno Community Hospital and Medical Center v. Cochran" on Justia Law

Participants in Georgetown University retirement plans sued the University and individual plan fiduciaries, seeking to bring individual and representative class action claims for breach of fiduciary duty under the Employee Retirement Income Security Act (ERISA) 29 U.S.C. 1001–1461. They alleged that the plans paid excessive fees for record-keeping services and included investment options that consistently underperformed their benchmarks. In January 2019, the district court dismissed the complaint without prejudice, citing Article III standing as to some aspects of plan management, such as the inclusion of investment options neither plaintiff had selected. Regarding the duty of prudence, the court found that the excessive recordkeeping fees allegations provided no factual support for the assertion that the plans should pay only $35/year per participant. In May, the court denied as untimely their motion for leave to file an amended complaint.The D.C. Circuit vacated. Dismissal of a complaint without prejudice is generally not a final appealable order. Exceptions that apply where the record clearly indicates that the district court has separated itself from the case do not apply to this case. The January Order did not enter a final, appealable judgment; the district court erred when considering the motion to amend the complaint in refusing to apply the Rule 15(a)(2) standard, rather than the more restrictive standards under Rules 59(e) and 60(b). View "Wilcox v. Georgetown University" on Justia Law

A 2017 “tweet” by @realDonaldTrump stated: “The Amazon Washington Post fabricated the facts on my ending massive, dangerous, and wasteful payments to Syrian rebels fighting Assad.” BuzzFeed requested CIA records about Agency payments to Syrian rebels, citing the Freedom of Information Act, 5 U.S.C. 552(a)(3)(A). The Agency invoked Exemptions 1 and 3. The district court granted the Agency summary judgment, explaining that the “tweet did not mention the [Agency] or create any inference that such a program would be linked to or run by the [Agency].”BuzzFeed sent another, more broadly stated, request. The Agency asserted that a response would reveal whether it had an intelligence interest in, intelligence sources about, and connection to programs related to Syrian rebels — information exempt from disclosure under Exemptions 1 and 3. Exemption 1 covers “matters”2 that are “specifically authorized under criteria established by an Executive order to be kept secret in the interest of national defense or foreign policy. Exemption 3 covers matters “specifically exempted from disclosure by statute,” the National Security Act qualifies as a withholding statute under Exemption 3, 50 U.S.C. 3024(i)(1).The district court granted BuzzFeed summary judgment, holding that the tweet officially acknowledged “the government’s intelligence interest in the broader categories of records that BuzzFeed has requested.” The D.C. Circuit reversed. The tweet was not an official acknowledgment of the existence (or not) of Agency records. View "Leopold v. Central Intelligence Agency" on Justia Law