Rhoads v. U.S. Dep't of Veterans Affairs

242 F.Supp.3d 985

Joanne K. RHOADS and Mark Fisher, Plaintiffs,

v.The UNITED STATES DEPARTMENT OF VETERANS AFFAIRS, a Federal Agency, Defendant.

CASE NO. 1:16–cv–01273–LJO–EPG

United States District Court, E.D. California.

Signed March 16, 2017

Filed March 17, 2017

Jay A. Christofferson, Erin Tsitidis Huntington, Wanger Jones Helsley PC, Fresno, CA, for Plaintiffs.

Benjamin E. Hall, United States Attorney, Fresno, CA, for Defendant.

MEMORANDUM DECISION AND ORDER GRANTING PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANT'S CROSS–MOTION FOR SUMMARY JUDGMENT

ECF Nos. 13, 18.

Lawrence J. O'Neill, UNITED STATES CHIEF DISTRICT JUDGE

I. INTRODUCTION

Plaintiffs Joanne K. Rhoads ("Rhoads") and Mark Fisher ("Fisher") (collectively, "Plaintiffs") bring this action against Defendant, the United States Department of Veterans Affairs ("Defendant" or "VA"), to compel its employees to appear for depositions in state court personal injury actions brought by Plaintiffs. Plaintiffs bring a motion for summary judgment and ask the Court to order the VA to allow the depositions of three VA nurses. Defendant brings a cross-motion for summary judgment and asks the Court to deny Plaintiffs' request.

This matter is suitable for disposition without oral argument. See Local Rule 230(g).

II. FACTUAL BACKGROUND

Plaintiffs have each filed an action in Madera County Superior Court alleging that they suffered injuries because of exposure to carbon monoxide in the VA Clinic in Oakhurst, California ("Oakhurst Clinic"). (Administrative Record ("AR") 030; Defendant's Response to Plaintiffs' Statement of Undisputed Facts ("UMF")¹ No. 1, ECF No. 18–1.) Those two lawsuits are identified as: Rhoads v. Ladell, Inc. , Madera County Superior Court Case No. MCV06770 (the "Rhoades Action") (AR 030; UMF No. 2), and Fisher v. Ladell, Inc. , Madera County Superior Court Case No. MCV071017 ("the Fisher Action") (AR 030; UMF No. 3) (collectively, the "State Court Actions"). In those lawsuits, Plaintiffs allege that a malfunctioning HVAC system in the Oakhurst Clinic released carbon monoxide and caused them to suffer severe health repercussions, including difficulty walking, memory loss, and cognitive impairment. (AR 031–32; UMF No. 20.)

Plaintiffs allege, and Defendant does not dispute, that individuals employed by the VA witnessed Plaintiffs' suffering from the effects carbon monoxide exposure. (AR 030; UMF No. 5.) These employees include the three individuals whom Plaintiffs wish to depose in the State Court Actions: VA nurses Kristi Murasewski ("Murasewski"), Dorothy Johnson ("Johnson"), and Misty Yeterian ("Yeterian"). (AR 001; UMF Nos. 6, 8.) According to Plaintiffs, these individuals have "pertinent information relative to the facts at issue in the ongoing lawsuit and have the ability to provide first-hand personal knowledge as to relevant issues of the presence of carbon monoxide in the workplace, effects suffered by themselves, and others present in the workplace." (AR 030; UMF No. 6.) Plaintiffs allege, and Defendant does not dispute, that they have no remedy to obtain the knowledge of these witnesses other than through depositions. (AR 033; UMF No. 13.)

The VA previously inquired regarding the negative health effects caused by the malfunctioning HVAC system. (AR 031; UMF No. 7.) The VA also permitted Oakhurst Clinic Nurse Manager Eileen Hayes to be deposed in the Rhoads Action in December 2015 and February 2016 pursuant to a subpoena issued by Trane, Inc., one of the defendants in the State Court Actions. (AR 030, 032; UMF No. 14.)

Depositions of Murasewski, Johnson, and Yeterian were noticed by subpoenas issued to Defendant. (AR 009–029; UMF No. 8.) Plaintiffs have offered to depose these individuals on a weekend, holiday, day off, before work, or after work, and to make the location as convenient as possible for the witnesses. (AR 031; UMF No. 16.) Plaintiffs have also offered to make the depositions as short as possible to avoid work interruptions. (AR 031; UMF No. 17.)

In a letter dated July 22, 2016, the U.S. Attorney's Office advised Plaintiffs that the VA would not allow the depositions to proceed in the State Court Actions. (UMF Nos. 10–11; Christofferson Decl., Ex. G, ECF No. 13–3.) In the letter, counsel for the VA cited the Supreme Court's decision in Touhy v. Ragen , 340 U.S. 462, 468, 71 S.Ct. 416, 95 L.Ed. 417 (1951) ( " Touhy "), for the proposition that federal agency regulations prohibiting federal employees from testifying without authorization are "valid, enforceable, and binding on federal and state courts." (Christofferson Decl., Ex. G at 1.) The letter noted that VA regulations "require a party seeking testimony or documents in a legal proceeding to provide the agency a written request containing the information described in 38 C.F.R. § 14.805" and that "[t]he remedy for challenging an agency's decision whether to permit testimony is a separate action in federal court pursuant to the Administrative Procedure Act." (Id. at 2.)

In a separate February 16, 2017 letter, Camille Stroughter ("Stroughter"), a VA attorney, responded to Plaintiffs' August 9, 2016 request to take depositions.² (AR 066.) In that letter, the VA explained that its Touhy regulations required the determining official to "consider the effect ... which testifying ... will have on the ability of the agency or VA personnel to perform their official duties." (Id. ) The VA denied Plaintiffs' request, explaining that allowing its employees to be deposed would negatively impact patient care and would require the VA to spend money for private purposes unrelated to its mission. (Id. at 067.) The letter explained that the Oakhurst Clinic is an understaffed rural clinic that serves a needy population, and that changes to the nurses' schedules would negatively impact patient care. (Id. at 067–068.) The letter also specifically cited the following factors as reasons for the denial: 38 C.F.R. § 14.804(a) ("the need to avoid spending the time and money of the United States for private purposes and to conserve the time of the VA personnel for conducting their official duties concerning servicing the Nation's veteran population"); § 14.804(b) ("[h]ow the testimony or production of records would assist VA in performing its statutory duties"); § 14.804(h) ("[w]hether the testimony would ... interfere with patient care") and § 14.804(l) ("[t]he need to minimize VA's possible involvement in issues unrelated to its mission"). (Id. at 068.)

Discovery in the State Court Actions closes on April 19, 2017. (AR 031; UMF No. 12.) The State Court Actions are set for trial starting on June 19, 2017. (AR 031; UMF No. 11.)

III. PROCEDURAL BACKGROUND

Plaintiffs filed suit against Defendant on August 26, 2016, challenging the agency's decision under the Administrative Procedure Act ("APA") as arbitrary and capricious and seeking to obtain the right to depose three VA nurses in the underlying state court action. (ECF No. 2.) On January 13, 2017, Plaintiffs filed a motion for summary judgment. (ECF No. 13.) Defendant filed an opposition to Plaintiffs' motion for summary judgment and a cross-motion for summary judgment on February 17, 2017. (ECF No. 18.) Plaintiffs filed an opposition to Defendant's cross-motion for summary judgment and a reply in support of their motion for summary judgment on February 24, 2017. (ECF No. 19.) Defendant filed a reply in support of its cross-motion on March 3, 2017. (ECF No. 20.)

This Court has jurisdiction pursuant to the APA, 5 U.S.C. § 551 et seq. Venue is proper in this Court and the matter is ripe for review.

IV. STANDARD OF DECISION

The remedy for challenging an agency's decision not to authorize testimony is a separate action in federal court pursuant to the APA. See In re Boeh , 25 F.3d 761, 764 n.3 (9th Cir. 1994). In an action brought pursuant to the APA, a reviewing court may "hold unlawful and set aside agency action, findings, and conclusions found to be ... arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A). "It is well established that once an agency has taken final agency action under the APA, a reviewing court analyzes that decision under the ‘arbitrary and capricious' standard of review." Mt. St. Helens Mining & Recovery Ltd. P'ship v. United States , 384 F.3d 721, 727 (9th Cir. 2004) (citations omitted). The parties agree that the VA's decision to deny Plaintiffs' request to depose VA employees is a final agency action subject to review under the APA's "arbitrary and capricious" standard. (UMF Nos. 9, 10; ECF No. 13–1 at 5; ECF No. 18 at 6.)

"Under the arbitrary and capricious standard, a reviewing court must determine whether an agency's decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment." Mt. St. Helens , 384 F.3d at 728 (citation omitted). "This standard is narrow and [a reviewing court] may not substitute [its] judgment for that of the agency. Applying the arbitrary and capricious standard, [the] court must determine whether the agency articulated a rational connection between the facts and the choice made." Id. (citations omitted). "This standard of review is highly deferential, presuming the agency action to be valid and affirming the agency action if a reasonable basis exists for its decision." Ranchers Cattlemen Action Legal Fund v. U.S. Dep't of Agric. , 499 F.3d 1108, 1115 (9th Cir. 2007) (quotations omitted). "In its paradigmatic statement of this standard, the Supreme Court explained that an agency violates the APA if it has ‘relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.’ " Id. (quoting Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto....