United States District Court, N.D. California
ORDER DENYING DEFENDANTS' MOTIONS FOR STAY
M. CHEN UNITED STATES DISTRICT JUDGE
March 4, 2019, Defendants promulgated a new rule implementing
Title X of the Public Health Service Act. See
Compliance with Statutory Program Integrity Requirements, 84
Fed. Reg. 7714 (2019) (“Final Rule”). Plaintiffs
in these related actions, the State of California and
Essential Access Health, moved to preliminary enjoin
enforcement of the Final Rule. See California v.
Azar, No. 3:19-cv-1184-EMC (N.D. Cal.)
(“California”), Docket No. 26;
Essential Access Health, Inc. v. Azar, No.
3:19-cv-1195-EMC (N.D. Cal.)
(“Essential”), Docket No. 25. On April
26, 2019, this Court granted Plaintiffs' motions in
substantial part and enjoined the Final Rule from being
enforced in California. See California Docket No.
103 (“PI Order”).
before the Court are Defendants' motions to stay
proceedings in this Court pending resolution of their appeal
from the PI Order. California Docket No. 117;
Essential Docket No. 91 (collectively,
“Mot.”). The Court DENIES the
motions to stay.
Landis v. North American Co., 299 U.S. 248 (1936),
“[a] district court has discretionary power to stay
proceedings in its own court.” Lockyer v. Mirant
Corp., 398 F.3d 1098, 1109 (9th Cir. 2005). Where a
court is asked to stay proceedings pending the outcome of a
the competing interests which will be affected by the
granting or refusal to grant a stay must be weighed. Among
those competing interests are the possible damage which may
result from the granting of a stay, the hardship or inequity
which a party may suffer in being required to go forward, and
the orderly course of justice measured in terms of the
simplifying or complicating of issues, proof, and questions
of law which could be expected to result from a stay.
Id. at 1110 (quoting CMAX, Inc. v. Hall,
300 F.2d 265, 268 (9th Cir. 1962)). “The proponent of a
stay bears the burden of establishing its need.”
Clinton v. Jones, 520 U.S. 681, 708 (1997) (citing
Landis, 299 U.S. at 255).
The Orderly Course of Justice
primary argument is that a stay will result in a
simplification of issues. According to Defendants, “the
Ninth Circuit's disposition of the appeal is likely to be
controlling with respect to the central merits issues
presented in this case, ” and so forging ahead without
waiting for an appellate decision would cause “the
parties and the Court [to] waste time and resources briefing
and considering legal issues that are to be determined by the
Ninth Circuit.” Mot. at 4-5. This rationale is
unpersuasive. It is true that in reviewing any preliminary
injunction order, the appellate court must preview the merits
of the case. But the Ninth Circuit has “repeatedly
admonished district courts not to delay trial preparation to
await an interim ruling on a preliminary injunction.”
California v. Azar, 911 F.3d 558, 583-84 (9th Cir.
2018) (citations omitted). “Because of the limited
scope of [appellate] review of the law applied by the
district court and because the fully developed factual record
may be materially different from that initially before the
district court, [the Ninth Circuit's] disposition of
appeals from most preliminary injunctions may provide little
guidance as to the appropriate disposition on the
merits.” Id. at 584. Here, for instance, the
Court rendered its preliminary injunction decision before the
full administrative record became available. That record has
now been produced and will ground the litigation going
forward. Further, Plaintiffs asserted constitutional claims
in their complaints that were not raised at the preliminary
injunction stage. Moving forward with these proceedings would
also allow those claims to be adjudicated in a timely manner.
cite Washington v. Trump, No. C17-0141JLR, 2017 WL
1050354 (W.D. Wash. Mar. 17, 2017) and Hawai'i v.
Trump, 233 F.Supp.3d 850 (D. Haw. 2017) in support of
their argument that a stay is warranted on efficiency
grounds. But the courts in Washington and
Hawai'i each stayed determination of a pending
motion for a temporary restraining order (“TRO”)
while the Ninth Circuit ruled on an appeal from a
substantively identical TRO issued by a different court.
See Washington, 2017 WL 1050354, at *5;
Hawai'i, 233 F.Supp.3d at 855. Here, in
contrast, Defendants assert that merits proceedings should be
halted altogether while the Ninth Circuit reviews a
preliminary injunction ruling this Court has already made.
Neither Washington nor Hawai'i stand
for such a proposition.
“orderly course of justice” factor in
Lockyer weighs against granting a stay.
The Possible Damage Resulting from a Stay and the
Hardship or Inequity from Going Forward
“[party seeking] a stay must make out a clear case of
hardship or inequity in being required to go forward, if
there is even a fair possibility that the stay for which he
prays will work damage to some one else.”
Lockyer, 398 F.3d at 1109-10 (quoting
Landis, 299 U.S. at 255 (alteration in original)).
There is clearly more than “a fair possibility”
that a stay would harm Plaintiffs here. In the PI Order, the
Court found that “[u]nless enjoined, the Final Rule
will irreparably harm individual patients and public health
in California as a whole” by “decimat[ing] the
network of Title X providers in California and drastically
restrict[ing] patients' access to a wide range of vital
services.” PI Order at 2. Delaying the ultimate
resolution of the Final Rule's lawfulness would expose
Plaintiffs to this harm if the Ninth Circuit dissolves the
preliminary injunction and the final adjudication of this
case is delayed ...