White Coat Waste Project, Inc. v. U.S. Dep't of Health & Human Servs.

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WHITE COAT WASTE PROJECT, INC., Plaintiff, v. U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES, et al., Defendants.

Civil Action No. 1:22-cv-00006 (CJN)

United States District Court, District of Columbia

August 2, 2023

MEMORANDUM OPINION

CARL J. NICHOLS UNITED STATES DISTRICT JUDGE.

The National Institutes of Health (“NIH”) funds biomedical and behavioral research on animals by approving grants to foreign and domestic research entities. To ensure proper care of animals used in that research, Section 495 of the Public Health Services Act (“Services Act”) 42 U.S.C. § 289d, requires the Secretary of Health and Human Services, acting through the Director of NIH, to set guidelines for grant recipients to follow. In this suit, a watchdog group called White Coat Waste Project, Inc. (“White Coat”) claims that NIH violated the Services Act by exempting foreign grant recipients from some of those guidelines. NIH moves to dismiss the complaint, on grounds that White Coat lacks standing and fails to assert an interest protected by the Services Act. The Court disagrees-at this stage in the proceedings, White Coat has adequately established that it has organizational standing and that its interests arguably fall within the zone of interests protected by the statute. The Court will thus deny NIH's motion to dismiss.

I. Background

A. Legal Framework

Each year, the federal government spends around $20 billion on animal research by providing grants, contracts, and additional funding to research entities. Am. Compl. ¶ 1, ECF No. 17. Both foreign and domestic entities are eligible to receive NIH funding for this research- indeed, about a quarter of eligible grantees are foreign laboratories. Declaration of Daniel Eduardo Lopez Brena (“Lopez Decl.”) ¶ 28, ECF No. 24-3. Whether foreign or domestic, any institution that uses animals in NIH-funded research must comply with certain animal welfare requirements.

These requirements flow from the Services Act. The Act requires the Secretary to establish guidelines for the proper care of animals used in NIH-funded biomedical and behavioral research. 42 U.S.C. § 289d(a). Applicants for funding must, in turn, provide “assurances” that they comply with these guidelines. Id. § 289d(c)(1). No entity may receive funding for research involving animals unless NIH approves its animal welfare assurance. Id. § 289d(c)-(d).

As relevant here, NIH provides alternative ways for entities to obtain approval of their assurances. Domestic institutions must, among other things, set up an Institutional Animal Care and Use Committee (“animal care committee”) to monitor the institution's compliance with applicable guidelines. See Public Health Service Policy on the Humane Care and Use of Laboratory Animals (“Humane Care Policy”), Secs. II, IV.A.3, Ex. 3, ECF No. 24-2. Animal care committees must keep certain records and file reports of violations with NIH. § 289d(b)(3). Foreign institutions, by contrast, have a choice: They can either set up an animal care committee, or they can submit evidence to NIH proving “that acceptable standards for the humane care and use of the animals in [NIH-funded] activities will be met.” Humane Care Policy, Sec. II. This suit is (in part) about whether the Services Act permits that choice.

B. This Lawsuit

White Coat “is a bipartisan taxpayer watchdog organization.” Am. Compl. ¶ 6. Its mission is to “unite animal-lovers and liberty-lovers to find, expose, and defund wasteful and cruel taxpayer-funded animal experimentation.” Id. That mission, White Coat says, is frustrated by NIH's decision to exempt foreign grantees from the same requirements applicable to domestic grantees. And that exemption, White Coat continues, violates the plain text of the Services Act.

Specifically, White Coat contends that the Services Act requires all entities-foreign and domestic-receiving funds for animal research to “maintain an animal care committee to review, approve, and monitor animal experiments, and to ensure proper care for animals.” Id. ¶ 1. Yet NIH has, according to White Coat, “enacted multiple contradictory and binding agency rules exempting foreign grant recipients of taxpayer money for animal experiments from maintaining an animal care committee.” Id. As a result, White Coat has had to alter its operations and “redirect its limited resources to counteract and offset [NIH's] unlawful actions and omissions.” Id. ¶ 7. For example, because the challenged exemption appears to relieve foreign entities from certain statutory record keeping and reporting obligations, White Coat allegedly cannot monitor compliance with animal welfare guidelines-and thereby expose animal mistreatment-through its regular practice of obtaining records from NIH through the Freedom of Information Act (“FOIA”). See, e.g., id. ¶ 93; Lopez Decl. ¶¶ 6-10. White Coat instead has had to track down relevant information through other, more time-consuming methods. See, e.g., Lopez Decl. ¶¶ 4445.

White Coat alleges that NIH violated the Administrative Procedure Act by exempting foreign entities from certain statutory requirements. Alternatively, White Coat alleges that the guidance at issue constitutes rulemaking under the APA and that NIH disregarded notice-and- comment requirements. NIH moves to dismiss for lack of standing and failure to assert an interest protected by the Services Act.

II. Legal Standards

To survive a motion to dismiss under Rule 12(b)(1), a plaintiff must establish subjectmatter jurisdiction. Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992). At this stage, a plaintiff's burden is not heavy-the court must “assume the truth of all material factual allegations in the complaint and construe the complaint liberally, granting plaintiff the benefit of all inferences that can be derived from the facts alleged.” Am. Nat'l Ins. Co. v. FDIC, 642 F.3d 1137, 1139 (D.C. Cir. 2011) (quotations omitted). The court may also “consider materials outside the pleadings in deciding whether to grant a motion to dismiss for lack of jurisdiction.” Jerome Stevens Pharms. v. FDA, 402 F.3d 1249, 1253 (D.C. Cir. 2005).

Standing is a predicate to subject-matter jurisdiction and requires a plaintiff to “show injury in fact that was caused by the conduct of the defendant[] and that can be redressed by judicial relief.” Pub. Citizen, Inc. v. Nat'l Highway Traffic Safety Admin., 489 F.3d 1279, 1289 (D.C. Cir. 2007). These elements-injury-in-fact, causation, and redressability-“must be supported in the same way as any other matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree of evidence required at the successive stages of the litigation.” Lujan, 504 U.S. at 561. In other words, a “plaintiff's burden to demonstrate standing grows heavier at each stage of the litigation.” Osborn v. Visa Inc., 797 F.3d 1057, 1063 (D.C. Cir. 2015). At the dismissal stage, all that is needed is a “plausible claim” that the plaintiff has standing. Food & Water Watch, Inc. v. Vilsack, 808 F.3d 905, 913 (D.C. Cir. 2015) (quotations omitted).

To survive a motion to dismiss under Rule 12(b)(6), a complaint must allege facts that “state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

In assessing such a motion, the court must “treat the complaint's factual allegations as true and must grant the plaintiff the benefit of all inferences that can be derived from the facts alleged.” L. Xia v. Tillerson, 865 F.3d 643, 649 (D.C. Cir. 2017) (cleaned up).

III. Analysis

A. White Coat has adequately established organizational standing.

An organization “can assert standing on its own behalf, on behalf of its members or both.” Equal Rights Ctr. v. Post Props., Inc., 633 F.3d 1136, 1138 (D.C. Cir. 2011). White Coat asserts standing on its own behalf-also called organizational standing-so it must, just like an individual plaintiff, establish an injury in fact caused by the defendant and likely to be redressed by a favorable judicial decision. Id. To satisfy the injury-in-fact prong, White Coat must allege a “concrete and demonstrable injury to [its] activities” and a “consequent drain on [its] resources.” Havens Realty Corp. v. Coleman, 455 U.S. 363, 379 (1982). “A mere setback to its abstract social interests is not sufficient.” Equal Rights Ctr., 633 F.3d at 1138 (quotations omitted). Nor is it enough for White Coat to rely on the diversion of its resources to litigation, education, or advocacy. Food & Water Watch, 808 F.3d at 919-20.

Determining whether White Coat's injury is “concrete and demonstrable” boils down to a two-part inquiry. First, the Court must ask whether NIH injured White Coat's interests. Second, the Court must ask whether White Coat used its resources to counter the harm. Equal Rights Ctr., 633 F.3d at 1140. If NIH's conduct, as alleged, is in “direct conflict” with White Coat's mission, and if it “perceptibly impaired” White Coat's “ability to provide services” by causing an “inhibition of [White Coat's] daily operations,” then White Coat has suffered an injury in fact. Am. Soc. for Prevention of Cruelty to Animals v. Feld Ent., Inc., 659 F.3d 13, 25 (D.C. Cir. 2011) (quotations omitted); Food & Water Watch, 808 F.3d at 919 (quotations omitted).

At this stage in the proceedings, White Coat has adequately shown that NIH's conduct injured its interests and that it has expended resources to counter the harm. Recall that White Coat's mission is to “unite animal-lovers and liberty-lovers to find, expose, and defund wasteful and cruel taxpayer-funded animal experimentation.” Am. Compl ¶ 6. White Coat alleges that NIH's decision to exempt foreign entities from having to maintain animal care committees is in “direct conflict” with its mission to...