United States District Court, District of Columbia
MEMORANDUM OPINION
Emmet
G. Sullivan United States District Judge
Pursuant
to the Indian Self-Determination and Education Assistance Act
(“ISDEAA”), 25 U.S.C. §§ 5301, et
seq., Plaintiff Cook Inlet Tribal Council
(“CITC”), an Alaskan Native tribal organization,
challenges a decision of the Indian Health Service
(“IHS”), a component of the United States
Department of Health and Human Services (“HHS”).
On July 7, 2014, IHS declined CITC's 2014 proposed
amendment to the funding agreement in its self-determination
contract with the federal government (the “declination
decision”). On November 7, 2018, this Court issued a
Memorandum Opinion and a separate Order (“Remand
Order”) that granted in part CITC's motion for
summary judgment, vacated the declination decision, and
remanded it to IHS for a determination consistent with the
Opinion without issuing a final judgment. Cook Inlet
Tribal Council v. Mandregan, 348 F.Supp.3d 1, 2-3, 17
(D.D.C. 2018) (“Cook I”).
The
parties move for reconsideration of the remedy the Court
ordered in Cook I. CITC also moves for
attorneys' fees and costs. Upon careful consideration of
the parties' submissions, the applicable law, the entire
record, and for the reasons stated below, the Court
GRANTS IN PART and DENIES IN
PART CITC's cross-motion for reconsideration,
GRANTS IN PART and DENIES IN
PART Defendants' motion for reconsideration, and
HOLDS IN ABEYANCE CITC's motion for
attorneys' fees and costs.
I.
Background
The
Court assumes the parties' familiarity with the factual
background and procedural history, which are set forth in
greater detail in the Court's prior Opinion. See Cook
I, 348 F.Supp.3d at 2-4. Before addressing the
parties' arguments, the Court provides an abbreviated
overview of the relevant statutory scheme and the Court's
previous rulings.
The
ISDEAA authorizes the Secretary of HHS or the Secretary of
the United States Department of the Interior to enter into
self-determination contracts with Indian tribes and tribal
organizations. See 25 U.S.C. § 5321; see
also Id. § 5304(i), (j). Under those contracts, the
tribes promise to provide federally-funded services, such as
tribal educational, social, and health services, that
otherwise would have been provided by the federal government.
Id. § 5321(a). The ISDEAA directs the Secretary
to enter into a self-determination contract with an Indian
tribe upon the request of the tribe under certain
circumstances. Id.
The
Secretary can pay an Indian tribe or a tribal organization
from two sources of funding: (1) the
“Secretarial” amount, id. §
5325(a)(1); and (2) the “contract support costs”
amount, id. § 5325(a)(2), (3). The Secretarial
amount is the amount that the Secretary would have spent if
the agency itself operated the programs. Cook I, 348
F.Supp.3d at 7. The Secretarial amount is committed to the
agency's discretion. See 25 U.S.C. §
5325(a)(1). But the Secretary has limited discretion for the
contract support costs funding. See §
5325(a)(2); see also Ramah Navajo Sch. Bd., Inc. v.
Babbitt, 87 F.3d 1338, 1344 (D.C. Cir. 1996)
(“Congress left the Secretary with as little discretion
as feasible in the allocation of [contract support
costs].”).
Because
“[i]t soon became apparent” that the Secretarial
amount did not fully account for the total costs incurred by
Indian tribes to provide the services under the
self-determination contracts, Salazar v. Ramah Navajo
Chapter, 567 U.S. 182, 186 (2012), the ISDEAA
“mandates that the Secretary shall pay the full amount
of ‘contract support costs' incurred by tribes in
performing their contracts.” Id. at 185;
see also 25 U.S.C. § 5325(a)(2). The ISDEAA
defines “contract support costs” as “an
amount for the reasonable costs for activities which must be
carried on by a tribal organization as contractor to ensure
compliance with the terms of the contract and prudent
management[.]” Cook I, 348 F.Supp.3d at 7
(quoting 25 U.S.C. § 5325(a)(2)).[1]
At
issue in this case is whether the Secretary must pay a tribal
organization's “facility support costs”
exclusively from the Secretarial amount, or whether facility
support costs can be paid from the “contract support
costs” amount. Cook I, 348 F.Supp.3d at 2. For
tribal contractors, like CITC, the ISDEAA allows them to
propose amendments to the funding agreements in
self-determination contracts. Id. at 8 (citing 25
U.S.C. § 5321(a)(2)). Through annual funding agreements
incorporated into the contracts, the Secretary pays the
tribe's costs to administer the programs when the tribe
submits a proposal. See 25 U.S.C. § 5321(a)(2).
“[T]he Secretary shall, within ninety days after
receipt of the proposal, approve the proposal and award the
contract unless the Secretary provides written notification
to the applicant that contains a specific finding that
clearly demonstrates” one of the five conditions set
forth in Section 5321(a)(2). Id.; see also
Id. § 5321(a)(4). “[T]he Secretary may extend
or otherwise alter the 90-day period . . . if before the
expiration of such period, the Secretary obtains the
voluntary and express written consent of the tribe or tribal
organization to extend or otherwise alter such period.”
Id. § 5321(a)(2); see also 25 C.F.R.
§ 900.18 (“A proposal that is not declined within
90 days (or within any agreed extension . . .) is deemed
approved . . . .”).[2]
Since
1992, CITC has contracted with IHS to operate substance abuse
programs serving Alaskan Natives living in the Cook Inlet
region-programs that would otherwise have been federal
programs. Cook I, 348 F.Supp.3d at 3-4. CITC
operates these programs under the authority of a Board of
Directors, which consists of representatives from eight
federally-recognized Native American tribes. Id. at
4. CITC's first self-determination contract provided,
among other costs, $11, 838.50 for facility-related costs.
Id. CITC has received that same amount for those
costs in subsequent years. Id. By 2013, CITC's
facility support costs grew to $479, 040. Id. In
April 2014, CITC proposed an amendment to the 2014
self-determination contract to add $479, 040 in “direct
contract support costs associated with facility
support.” Id.
In
rejecting CITC's proposal in July 2014, id., IHS
based its declination decision on one of the five declination
options permitted in the ISDEAA: “[T]he amount of funds
proposed under the contract is in excess of the applicable
funding level for the contract[.]” 25 U.S.C. §
5321(a)(2)(D). IHS interpreted the ISDEAA's funding
provisions to mean that CITC already receives those costs
through its annual “Secretarial” funding.
Cook I, 348 F.Supp.3d at 4; see also 25
U.S.C. § 5325(a)(3)(A) (contract support costs funding
“shall not duplicate any funding” otherwise
provided). In other words, IHS argued that CITC's request
for $479, 040 in facility support costs would result in
duplicative funding as both Secretarial funding and contract
support costs, in violation of the ISDEAA. Cook I,
348 F.Supp.3d at 4.
Shortly
thereafter, litigation ensued. Id. CITC appealed
IHS' declination decision to this Court, bringing suit
against Christopher Mandregan, Jr., Alaska Area Director of
IHS; Alex M. Azar II, [3] Secretary of HHS; and the United States of
America (collectively, the “Defendants”).
Id. at 2, 4. Thereafter, the parties filed
cross-motions for summary judgment. Id. at 4.
In
Cook I, the Court granted in part CITC's motion
for summary judgment and vacated IHS' declination
decision of CITC's 2014 proposal for additional
“contract support costs” funding to account for
the increased facility support costs because IHS improperly
declined the proposal. Id. at 17. The Court found
that IHS failed to meet its burden of demonstrating that
CITC's proposal was in excess of the applicable funding
level for the contract, id. at 14, and that the
administrative record did not contain sufficient
documentation for the Court to determine whether or not
CITC's request duplicates any funding already provided by
the agency, id. at 17. The Court held that Section
5325 of the ISDEAA, 25 U.S.C. § 5325, is ambiguous,
id. at 8-12, and found that CITC's
interpretation of IHS' guidance-suggesting that facility
support costs may be funded as “contract support
costs”-is reasonable, id. at 12-13, 16. In
fashioning a remedy, the Court remanded CITC's 2014
contract proposal to IHS for a determination consistent with
the Court's Opinion regarding the amount of facility
support costs that should be funded as contract support costs
beginning with the 2014 contract to present. Id. at
17. The Court directed the Clerk of Court to close the case
without prejudice, granting either party with the option to
file a motion to re-open the case following further IHS
proceedings. Remand Order, ECF No. 38 at 2.[4] The Court did not
direct the Clerk to enter a final judgment. See id.;
see also Cook I, 348 F.Supp.3d at 17.
Cook
I set in motion a flurry of activity, including: (1)
cross-motions for reconsideration, see, e.g.,
Defs.' Mot. for Recons., ECF No. 43; Pl.'s Cross-Mot.
for Recons. (“Pl.'s Mot. for Recons.”), ECF
No. 52; (2) a motion for attorneys' fees, see
Pl.'s Mot. for Att'ys' Fees & Costs, ECF No.
41; (3) a motion to stay agency proceedings, see
Pl.'s Mot. to Stay, ECF No. 49; (4) a Bill of Costs,
see Pl.'s Bill of Costs, ECF No. 40; and (5) an
appeal to the United States Court of Appeals for the District
of Columbia Circuit (“D.C. Circuit”),
see Defs.' Notice of Appeal, ECF No.
47.[5]
The
Court exercised its remedial discretion to stay its Remand
Order, see Min. Order (Jan. 18. 2019) (citing
Friends of Earth, Inc. v. EPA, 446 F.3d 140, 148
(D.C. Cir. 2006)). The Court retained jurisdiction over the
case due to the pending cross-motions for reconsideration,
see Min. Order (Jan. 18. 2019), and the D.C. Circuit
held in abeyance the appeal pending the resolution of those
motions, see Order, ECF No. 56 (D.C. Cir. Jan. 23,
2019). Finally, the Court granted the parties' proposed
briefing schedule for the pending motions, Min. Order (Jan.
29, 2019).[6] Those motions are ripe and ready for the
Court's adjudication.
II.
Legal Standard
Federal
Rule of Civil Procedure 54(b) governs the parties'
cross-motions for reconsideration because the Court has not
entered a final judgment. Shapiro v. U.S. Dep't of
Justice, No. CV 13-555 (RDM), 2016 WL 3023980, at *2
(D.D.C. May 25, 2016) (applying Rule 54(b) to a motion for
reconsideration “[b]ecause the Court ha[d] not entered
final judgment”).[7] Under Rule 54(b), “the Court
[may] revisit any order that adjudicates ‘fewer than
all the claims or rights and liabilities of fewer than all
the parties . . . at any time before' the entry of final
judgment.” Id. (quoting Fed.R.Civ.P. 54(b)).
The standard for determining whether or not to grant a motion
for reconsideration brought under Rule 54(b) is the “as
justice requires” standard. Judicial Watch v.
Dep't of Army, 466 F.Supp.2d 112, 123 (D.D.C. 2006).
Under this flexible standard, the Court considers
“whether the court patently misunderstood the parties,
made a decision beyond the adversarial issues presented, made
an error in failing to consider controlling decisions or
data, or whether a controlling or significant change in the
law has occurred.” In Def. of Animals v. Nat'l
Insts. of Health, 543 F.Supp.2d 70, 75 (D.D.C. 2008)
(internal quotation marks omitted); see also Montgomery
v. IRS, 356 F.Supp.3d 74, 79 (D.D.C. 2019)
(“[T]here must be some ‘good reason' to
reconsider an issue already litigated by the parties and
decided by the court, such as new information, a
misunderstanding, or a clear error.”).
The
moving party has the burden of demonstrating “that some
harm, legal or at least tangible, would flow from a denial of
reconsideration.” In Def. of Animals, 543
F.Supp.2d at 76 (quoting Cobell v. Norton, 355
F.Supp.2d 531, 540 (D.D.C. 2005)). “[E]ven if justice
does not require reconsideration of an interlocutory ruling,
a decision to reconsider is nonetheless within the
court's discretion[.]” Id. (internal
quotation marks omitted). However, this discretion is
“limited by the law of the case doctrine and
‘subject to the caveat that where litigants have once
battled for the court's decision, they should neither be
required, nor without good reason permitted, to battle for it
again.'” Id. (quoting Singh v. George
Wash. Univ., 383 F.Supp.2d 99, 101 (D.D.C. 2005)
(citation omitted)).
III.
Analysis
In
moving for reconsideration, Defendants seek clarification as
to whether the Remand Order was a final judgment, and request
that the Court limit the Remand Order to the 2014 contract
proposal on the ground that the 2014 contract proposal is the
only one at issue in this case. Defs.' Mot. for Recons.,
ECF No. 43 at 4. CITC moves for reconsideration on three
grounds: (1) “controlling decisions indicate an
[Administrative Procedure Act (“APA”)]-style
remand is improper in ISDEAA litigation”; (2) CITC will
suffer from “legal and tangible harm” as a result
of the denial of reconsideration; and (3) the parties never
“battle[d] over the question of [the appropriate]
remedy” in their summary judgment briefing. Pl.'s
Mot. for Recons., ECF No. 52 at 13 (internal quotation marks
omitted). The Court considers each argument in turn,
concluding that an award to CITC for the increased facility
support costs is the appropriate remedy under 25 U.S.C.
§ 5331(a), and that the award must be limited to the
2014 contract proposal.[8]
A.
The Remand Order Was Not a Final Judgment
The
parties agree that the Remand Order was not a final judgment.
See, e.g., Defs.' Mot. for Recons., ECF No. 43
at 5 (“Defendants believe this [R]emand [O]rder is not
a final judgment.”); Pl.'s Mot. for Recons., ECF
No. 52 at 13 (requesting entry of a final judgment);
Defs.' Opp'n, ECF No. 60 at 17. Nonetheless,
Defendants seek clarification on that point. E.g.,
Defs.' Mot. for Recons., ECF No. 43 at 4-6. Defendants
explain that they make this request for two reasons: (1) to
ensure that “the parties retain the ability to appeal
the [O]rder after the proceedings on remand[;]” and (2)
in the event that “the case is re-opened, and the Court
later issues a final judgment.” Defs.' Opp'n,
ECF No. 60 at 17-18.
A party
may seek appellate review “from all final
decisions of the district courts . . . .” 28
U.S.C. § 1291 (emphasis added). “It is black
letter law that a district court's remand order is not
normally ‘final' for purposes of appeal under 28
U.S.C. § 1291.” N.C. Fisheries Ass'n v.
Gutierrez, 550 F.3d 16, 19 (D.C. Cir. 2008) (citations
omitted). “[A]n exception to this general rule,
however, where the agency to which the case is remanded seeks
to appeal and it would have no opportunity to appeal after
the proceedings on remand.” Occidental Petroleum
Corp. v. SEC, 873 F.2d 325, 330 (D.C. Cir. 1989).
Applying these principles, the D.C. Circuit held that this
Court's Order granting summary judgment to a party and
remanding the matter to the agency for further proceedings
was “a non-final remand order[.]” Sierra Club
v. U.S. Dep't of Agric., 716 F.3d 653, 655 (D.C.
Cir. 2013).
The
same is true here. This Court granted in part CITC's
motion for summary judgment, vacated IHS' declination
decision, and remanded CITC's 2014 contract proposal to
IHS for a decision consistent with the prior Opinion.
Cook I, 348 F.Supp.3d at 16-17. The Court's
Remand Order cannot be construed as “final”
because the remand to IHS contemplated further proceedings
due to insufficient information in the administrative record
to support CITC's request for facility support costs.
See Pueblo of Sandia v. Babbitt, 231 F.3d 878, 881
(D.C. Cir. 2000) (determining that district court's
Remand Order “contemplate[d] more than the ministerial
act of using a corrected survey”).
Furthermore,
Defendants fail to argue that they would not have had an
opportunity to appeal the Court's decision after the
completion of the agency proceedings on remand. See
Defs.' Mot. for Recons., ECF No. 43 at 5-6. The Court
therefore finds that its Remand Order is not a final one.
See, e.g., Babbitt, 231 F.3d at 881
(holding that “[b]ecause the district court's order
[came] within the category of a remand for significant
further proceedings, ” the D.C. Circuit was
“without jurisdiction to review it because . . . remand
orders as a category are not final.”); cf. Liberty
Mut. Ins. Co. v. Wetzel, 424 U.S. 737, 744 (1976)
(orders granting partial summary judgment but leaving the
“award[ ] of other relief . . . to be resolved have
never been considered . . . ‘final' within the
meaning of 28 U.S.C. ...