The opinion of the court was delivered by: KAHN
In this civil rights action, the plaintiffs presently move for (1) an order dismissing the action as moot and (2) an order pursuant to 42 U.S.C. § 1988 awarding attorney's fees to plaintiffs as the prevailing party. Defendants do not oppose the application to dismiss the action as moot but they do oppose any award of attorney's fees.
In 1995 the New York Legislature enacted Chapter 81, § 75 of the laws of 1995 (hereinafter "§ 75") which amended § 365-a of the New York Social Security Law. This amendment precluded direct payments of Medicaid funds to all physicians, including consulting physicians and specialists, providing hospital emergency room and outpatient clinic services. In their complaint, the plaintiffs alleged that they were obligated by state and federal law to provide treatment to all persons who present themselves for treatment at an emergency room. On September 29, 1995 plaintiffs commenced the instant action seeking a judgment permanently enjoining the implementation of § 75.
A similar action had previously been commenced in the Southern District of New York. See Healthcare Association of New York State, Inc. v. Wing, No. 95 CIV 8527 (S.D.N.Y. 1995). On October 6, 1995 plaintiffs moved for a temporary restraining order and a preliminary injunction by order to show cause. The court granted a temporary restraining order enjoining the defendants from applying § 75. No hearing was ever held with respect to the application for the preliminary injunction, and the litigation apparently did not proceed any further.
The defendants in the instant action answered the complaint on November 6, 1995. Plaintiff thereafter engaged in discovery proceedings. All depositions of the defendants were completed on January 7, 1997.
On April 12, 1996 Governor Pataki signed into law Chapter 47 of the Laws of 1996 which repealed § 75 and restored full reimbursement for physician services delivered in a hospital emergency room. See Sabo Aff., Ex. 10.
Plaintiffs contend that the instant litigation was a catalyst for the enactment of this legislation. Plaintiffs therefore argue that they are prevailing parties under 42 U.S.C. § 1988 and are thus entitled to an award for the attorney's fees and costs they expended during the pendency of the suit. Defendants contend that the plaintiffs have not demonstrated that the instant litigation was a catalyst for the action by the legislature. Alternatively, defendants argue that the amount of attorney's fees sought is excessive.
"Title 42 U.S.C. § 1988 provides, in pertinent part, that the court in its discretion may allow a 'prevailing party' in a section 1983 action to recover reasonable attorney's fees." Koster v. Perales, 903 F.2d 131, 134 (2d Cir. 1990). However, before addressing the issue of whether the plaintiffs herein are "prevailing parties" under the statute, it appears necessary to consider what effect the acknowledged mootness of the underlying action has upon the present application. To the extent the parties have overlooked the point, the Court raises it sua sponte. Ross v. Albany Medical Center, 916 F. Supp. 196, 203 (N.D.N.Y. 1996) (Scullin, J.).
Article III of the Constitution requires that there be an actual live case or controversy before a federal court can act. Burke v. Barnes, 479 U.S. 361, 363, 93 L. Ed. 2d 732, 107 S. Ct. 734 (1987). Ordinarily, if an action becomes moot during its pendency, it must be dismissed for lack of subject matter jurisdiction. Lewis v. Continental Bank Corp., 494 U.S. 472, 477, 108 L. Ed. 2d 400, 110 S. Ct. 1249 (1990). Thus, as the parties acknowledge, if the repeal of § 75 has rendered the instant action moot it would be subject to dismissal for lack of subject matter jurisdiction. In their complaint, the plaintiffs sought no relief other than a permanent injunction barring the application of § 75 and attorney's fees if they prevailed. Since § 75 has been repealed out of existence, there is nothing left to enjoin and the Court thus concurs that the action is moot.
When a district court lacks "subject matter jurisdiction to proceed with the substantive claim, as a matter of law 'that lack of jurisdiction bar[s] an award of attorneys fees under section 1988.'" W.G. v. Senatore, 18 F.3d 60, 64 (2d Cir. 1994)(quoting Keene Corp. v. Cass, 908 F.2d 293, 298 (8th Cir. 1990). That is because "fee shifting provisions cannot themselves confer subject matter jurisdiction." Id. This rule has been applied to bar an award where an action was moot at the time of filing. See Randolph Union High Sch. Dist. No. 2 v. Byard, 897 F. Supp. 174, 176 (D.Vt. 1995) (denying application for attorney's fees in action where "dispute was moot when it was filed"). In cases involving intervening mootness (such as the instant case), a district court may still award attorney's fees under § 1988. Haley v. Pataki, 106 F.3d 478, 483 (2d Cir. 1997). "Mootness is not determinative as to the propriety of an award of attorney's fees." LaRouche v. Kezer, 20 F.3d 68, 75 (2d Cir. 1994).
The question for the Court therefore remains whether the plaintiffs herein are a "prevailing party" under § 1988. In cases involving a moot claim, the court must consider (1) whether the plaintiff has obtained any interim judicial relief; and (2) whether this relief was granted after a determination on the merits. Haley, 106 F.3d at 483. No award should be granted if it is not "clear that the district court has had the opportunity to render a ruling on the merits of the claim." Id. at 484. Thus, if the court grants a preliminary injunction after taking up the merits of the claim, a party can be said to have prevailed. Id. Conversely, a plaintiff who merely ...