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Mayor and City Council of Baltimore v. Azar

United States District Court, D. Maryland

June 19, 2019

MAYOR AND CITY COUNCIL OF BALTIMORE, Plaintiff,
v.
ALEX M. AZAR II, Secretary of Health and Human Services, et al., Defendants.

          MEMORANDUM ORDER

          Richard D. Bennett United States District Judge.

         On May 30, 2019, this Court issued an Order preliminarily enjoining the Health and Human Services Final Rule ("Final Rule"), entitled Compliance with Statutory Program Integrity Requirements, 84 Fed. Reg. 7, 714 (Mar. 4, 2019), to be codified at 42 C.F.R. Part 59, as to enforcement in the State of Maryland. (ECF No. 44.) Defendants have filed an interlocutory appeal and seek a stay of the preliminary injunction pending the appeal of the Order. (See ECF Nos. 48, 49 .)[1] For the following reasons, this Court shall DENY Defendants' Motion for Stay of Injunction Pending Appeal (ECF No. 49).

         STANDARD OF REVIEW

         The factors regulating the issuance of a stay under Fed.R.Civ.P. 62 (c) are similar to those that guide the court when evaluating whether a preliminary injunction should issue: "(1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies." Hilton v. Braunskill, 481 U.S. 770, 776 (1987); Long v. Robinson, 432 F.3d 977, 979 (4th Cir. 1970); see also Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 20 (2008) (requiring a movant for a preliminary injunction to show that: (1) the movant is likely to succeed on the merits; (2) the movant is likely to suffer irreparable harm absent preliminary relief; (3) the balance of equities favors the movant; and (4) that an injunction is in the public interest). A stay is not a "matter of right" but rather, "an exercise of judicial discretion . . . dependent upon the circumstances of the particular case." Nken v. Holder, 556 U.S. 418, 433 (2009) (quoting Virginian Ry. Co. v. United States, 272 U.S. 658, 672 (1926)).

         ANALYSIS

         As discussed in this Court's Memorandum Opinion issued only seven days prior to the filing of the instant motion, the Final Rule likely violates existing laws passed by the United States Congress. (ECF No. 43 at 2-3, 18-20.) After reviewing extensive briefing and hours of oral argument, this Court found that Plaintiff established a likelihood of irreparable harm unless the Final Rule is enjoined, and the balance of equities and public interest weighed in favor of the issuance of a preliminary injunction. (Id. at 25-26.) Accordingly, this Court issued a preliminary injunction on May 30, 2019. (Id. at 28.) Since that time, there has been no change in the record to justify a different result.[2] Defendants largely rely on the same arguments made in opposition to the motion for a preliminary injunction. (See Mot. Mem. passim, ECF No. 49-1.) This Court respectfully disagrees with Defendants regarding the probability of success on appeal.

         Defendants also assert that this Court's injunction is overbroad in two respects: (1) the injunction applies to the State of Maryland rather than simply the City of Baltimore, or possibly the City of Baltimore and its sub-grantees operating in the City; and (2) despite the Final Rule's severability statement, the entire Final Rule was enjoined, including provisions that were not challenged. (Mot. Mem. 7-8, ECF No. 49-1.) As noted in its Memorandum Opinion, when this Court reviewed the scope of the injunction, it considered that the City of Baltimore will be impacted by loss of funding in neighboring communities as well as neighboring States. (ECF No. 43 at 25, 26-27.) Enjoining enforcement within the State of Maryland is narrowly tailored to avoid irreparable harm to the Plaintiff. Finally, this Court recognizes the Final Rule's severability provision and that Plaintiff did not challenge every aspect of the Final Rule. However, based on the record before it at this time, there is no clear delineation of which aspects of the Rule could or should be severed from the injunction. Preliminarily enjoining the enforcement of the Final Rule wholesale at this time best achieves the purpose of the injunction-"preserv[ing] the relative positions of the parties" pending final resolution of this case on die merits. United States v. South Carolina, 720 F.3d 518 (4th Cir. 2013)

         Accordingly, this Court declines to exercise its discretion to stay the preliminary injunction pending appeal and will deny the motion.

         CONCLUSION

         For the reasons stated above, IT IS this 19th day of June 2019, HEREBY ORDERED:

1. Defendants' Motion for Stay of Injunction Pending Appeal (ECF No. 49) is DENIED;
2. That the Clerk of the Court transmit copies of this Order and accompanying Memorandum Opinion to counsel for both parties.

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