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Comprehensive Community Development Corp., D/B/A Soundview Healthcare Network et al v. Kathleen Sebelius

July 20, 2012


The opinion of the court was delivered by: Paul A. Engelmayer, District Judge:


Plaintiff Comprehensive Community Development Corp., d/b/a Soundview Health Care Network and its fellow plaintiffs (collectively, "Soundview") move to expand the administrative record in this Administrative Procedure Act ("APA"), 5 U.S.C. § 500 et seq., case. For the reasons that follow, the motion is denied.


The background to this case is set out in detail in the Court's decision of March 7, 2012 (the "Injunction Decision"). (Dkt. 19.) The Court assumes familiarity with that decision.

In brief, Soundview challenges a grant funding decision by the Health Resources and Services Administration ("HRSA"), an operating division of the United States Department of Health and Human Services ("HHS"). HRSA was charged with awarding grant funding under the Health Center Program (the "Program") to an eligible health center in the Bronx, New York, service area, for the period 2012--2017. In January 2012, HRSA awarded the grant to Urban Health Plan, Inc. ("Urban Health"). Soundview, which had been awarded the predecessor grant, contends that, had HRSA properly evaluated the competing grant applications, it would have prevailed.

Soundview filed this lawsuit on January 31, 2012, hours before its predecessor grant expired and hours before, on February 1, 2012, the grant to Urban Health became effective. On March 7, 2012, the Court denied Soundview's motion for preliminary injunctive relief. Soundview had sought an order directing that HRSA redirect, from Urban Health to Soundview, funds under the 2012--2017 grant. (Dkt. 19.)

On April 6, 2012, HRSA filed the administrative record in connection with its grant award. (Dkt. 27.) It did so to permit the parties to brief the merits of Soundview's APA claim, and the Court to determine whether the grant award decision violated the APA.

On May 2, 2012, Soundview moved to expand the administrative record. (Dkt. 42.)*fn1 Soundview's brief supporting that motion takes the form of a declaration from its attorney, Ezra Glaser, Esq. It argues that the record as compiled by the Government is "woefully inadequate" and "fails to include all of the documents and materials considered by the agency in reaching the challenged decision." Declaration of Ezra Glaser, Esq. ("Glaser Decl.") ¶ 3 (Dkt. 42). In particular, Soundview argues that the record was "specifically designed," id. ¶ 5, to exclude records that show that HRSA approached the grant application process with a predisposition against Soundview, as a result of what Soundview has termed its "associations with its founder and previous Chief Executive Office[r], Pedro Espada." Compl. ¶ 3; see also Glaser Decl. ¶¶ 33, 41. Among other things, Soundview contends that because Urban Health's medical facilities were significantly less conveniently located than Soundview's-Soundview contends, in fact, that Urban Health lacked any such facilities within the defined service area-Urban Health necessarily could not have prevailed over Soundview on the merits. Glaser Decl. ¶ 4.

On May 24, 2012, HRSA responded. It argued that to the extent Soundview identified specific types of documents ostensibly missing from the record, they were not among those considered by the agency in deciding to award the 2012--2017 grant to Urban Health. It further argued that Soundview had failed to make the showing of bad faith required for the Court to direct the production of, or consider, extra-record evidence. (Dkt. 48.)


A.Applicable Legal Standards

Under the APA, a court that reviews agency action to determine if it was "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law," 5 U.S.C. § 706(2)(A), is to "review the whole record or those parts of its cited by a party." Id. § 706. Courts have consistently held that the term "the whole record" refers to the full record that was before the agency, meaning the agency decision-maker, at the time of the decision.

For example, where the issue at hand was the decision by the Secretary of the Interior to authorize construction of a highway through a public park, the Supreme Court remanded for plenary review by the district court of "the full administrative record that was before the Secretary at the time he made his decision." See Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 420 (1971), abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1971). Lower courts have, similarly, held that the relevant materials "before the agency" are those that the agency decision-makers directly or indirectly considered. See, e.g., State of Delaware Dep't of Natural Res. and Envtl. Control v. U.S. Army Corp. of Eng'rs, 772 F. Supp. 2d 535, 541 (D. Del. 2010); Pac. Shores Subdivision Cal. Water Dist. v. U.S. Army Corps. of Eng'rs, 448 F. Supp. 2d 1, 4 (D.D.C. 2006) ("this Court has interpreted the 'whole' record; to include 'all documents and materials that the agency 'directly or indirectly considered' . . . [and nothing] more or less"; "in other words, the administrative record 'should not include materials that were not considered by agency decisionmakers'") (citations omitted; ellipses and brackets in original); State of New York v. Shalala, No. 93-cv-1330, 1996 WL 87240, at *6 (S.D.N.Y. Feb. 29, 1996).

It is, further, settled that deference is due to the agency's judgment as to what constitutes the whole administrative record. "It is the province of the agency to compile and submit the administrative record for review by the Court," State of Delaware, 722 F. Supp. 2d at 541--42, and "[c]ommon sense dictates that the agency determines what constitutes the whole administrative record because it is the agency that did the considering, and that therefore is in a position to indicate initially which of the materials were before it-namely, were directly or indirectly considered." Pac. Shores, 448 F. Supp. 2d at 5 (internal quotation marks and citation omitted). As with its execution of other official duties, an agency's designation of the administrative record "is generally afforded a presumption of regularity." State of Delaware, 722 F. Supp. 2d at 542; see also Pac. Shores, 448 F. Supp. 2d at 5. (citing Bar MK Ranches v. Yuetter, 994 ...

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