Valentini v Shinseki Govt MSJ Brief

7/30/2019 Valentini v Shinseki Govt MSJ Brief

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STUART F. DELERYActing Assistant Attorney GeneralANDRE BIROTTE JR.United States Attorney

JUDRY L. SUBAR

Assistant Branch DirectorELISABETH LAYTONSenior CounselKAREN S. BLOOMTrial AttorneyU.S. Department of JusticeCivil DivisionFederal Programs Branch20 Massachusetts Ave., N.W.Washington, DC 20001T: (202) 514-3183; F: (202) 616-8470

Email: [email protected]

Attorneys for Defendants

UNITED STATES DISTRICT COURTCENTRAL DISTRICT OF CALIFORNIA

GREGORY VALENTINI, et al.,

Plaintiffs,

v.

ERIC SHINSEKI, et. al.,

Defendants.

))

)))))))))

Case No. 11-CV-04846 SJO MRWx)DEFENDANTS NOTICE OFMOTION AND MOTION FORSUMMARY JUDGMENT;MEMORANDUM OF POINTS ANDAUTHORITIES AND SUGGESTIONOF LACK OF JURISDICTION

[NO HEARING DATE SET][Before the Honorable S. JamesOtero]

Case 2:11-cv-04846-SJO-MRW Document 116 Filed 04/10/13 Page 1 of 33 Page ID #:3727


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NOTICE OF MOTION AND MOTION FOR SUMMARY JUDGMENT

PLEASE TAKE NOTICE that pursuant to the Courts February 13, 2013

Order (ECF No. 111), Defendants Eric Shinseki, Secretary of the Department of

Veterans Affairs (VA), and Donna M. Beiter, Director of the VA Greater Los

Angeles Healthcare System, by and through their undersigned counsel, hereby

move the Court for summary judgment pursuant to Federal Rule of Civil Procedure

56(a). This motion is based on the attached Memorandum of Points and

Authorities and Suggestion of Lack of Jurisdiction, the Declaration of Elisabeth

Layton, the Administrative Record previously filed (ECF Nos. 96, 98, 112, 115),

and such other and further arguments and grounds as may be advanced in the

future.

This motion is made following a conference of counsel as required by Local

Rule 7-3, which took place on March 22, 2013.

No hearing has been set in accordance with the Courts Order of February

13, 2013 (ECF No. 111). Should the Court require a hearing, a date will be set by

the Court.

Dated: April 10, 2013 Respectfully submitted,


LEON W. WEIDMANChief, Civil DivisionALARICE M. MEDRANOAssistant United States AttorneyJUDRY L. SUBARAssistant Branch Director

By: /s/ Elisabeth Layton



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ELISABETH LAYTONSenior CounselKAREN S. BLOOMTrial AttorneyU.S. Department of Justice

Civil DivisionFederal Programs Branch20 Massachusetts Ave., N.W.Washington, DC 20001T: (202) 514-3183; F: (202) 616-8470Email: [email protected]

Attorneys for Defendants



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Case No. 11-cv-04846Memorandum in Support of Defendants Motion for Summary Judgment page i

TABLE OF CONTENTS

Page

INTRODUCTION ..................................................................................................... 1

FACTUAL AND PROCEDURAL BACKGROUND .............................................. 2

ARGUMENT ............................................................................................................. 3

I. VAS ACTIONS ARE UNREVIEWABLE BECAUSE THEY ARECOMMITTED TO AGENCY DISCRETION ..................................... 3

A. The Language of 8153 Shows The Decisions to Enter ESAs AreCommitted To VAs Discretion. ................................................ 6

B.. The Statutory Framework and Legislative History Show VADecisions to Enter ESAs Are Committed to VAs Discretion. .. 8

C. ESA Decisions Are Typical of Actions Committedto Agency Discretion. ................................................................. 10

II. EVEN IF VAS DECISIONS ARE REVIEWABLE, THEY DO NOTVIOLATE THE EPA. .......................................................................... 12

A. VA Acted In Accordance With Law In Entering Into MedicalSpace Sharing Agreements at its WLA Campus. ...................... 13

1. VAs Reading of Section 8153 Must Be AccordedDeference ............................................................................. 14

2. VAs Interpretation Of Its Authority Under 8153 IsPermissible. ........................................................................... 16

B. VAs Decisions To Enter ESAs Are Supported by theAdministrative Record, Which Shows That Decisions WereRationally Based On Relevant Factors. ..................................... 21

CONCLUSION ......................................................................................................... 24



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Case No. 11-cv-04846 Memorandum in Support of Defendants Motion for Summary Judgment ii

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TABLE OF AUTHORITIES

CASES PAGE(S)

Akiak Native Cmty v. U.S. Postal Serv.,

213 F.3d 1140 (9th Cir. 2000) ...............................................................................21

Alaska Dep't of Envtl. Conserv. v. EPA,

540 U.S. 461 (2004) .............................................................................................. 12

Am. Fed'n of Gov't Empls. v. Brown,

680 F.2d 722 (11th Cir. 1982) ...............................................................................16

Arent v. Shalala,

70 F.3d 610 (D.C. Cir. 1995) ................................................................................ 14Barnhart v. Walton,

535 U.S. 212 (2002) .............................................................................................. 15

Beno v. Shalala,

30 F.3d 1057 (9th Cir. 1994) ...................................................................................6

Cape Cod Hosp. v. Sebelius,

630 F.3d 203 (D.C. Cir. 2011) ....................................................................... 19, 20

Chevron U.S.A., Inc. v. Nat'l Res. Def. Council,

467 U.S. 837 (1984) ....................................................................................... 14, 15

County of San Francisco v. United States,

443 F. Supp. 1116 (N.D. Cal. 1977) .....................................................................12

Drakes Bay Oyster Co. v. Salazar,

No. 12-cv-06134-YGR, 2013 WL 451860 (N.D. Cal. Feb. 4, 2013) ...................11

E.J. Friedman Co. v. United States,

6 F.3d 1355 (9th Cir. 1993) .................................................................................4, 6

Ellison v. Connor,

153 F.3d 247 (5th Cir. 1998) ...................................................................................7



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Case No. 11-cv-04846 Memorandum in Support of Defendants Motion for Summary Judgment iii

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Forsyth Cnty. v. Army Corps of Eng'rs,

633 F.3d 1032 (11th Cir. 2011) ............................................................................... 7

Gibbons v. Fronton,

533 F. Supp. 2d 449 (S.D.N.Y. 2008) ..................................................................11

Haig v. Agee,,

453 U.S. 290 (1981) .............................................................................................. 18

Harkonen v. United States Dep't of Justice,

No. C12-629 CW, 2012 WL 6019571 (N.D. Cal. Dec. 3, 2012) ............................ 5

Heckler v. Chaney,

470 U.S. 821 (1985) ..................................................................................... 4, 5, 10

Helgeson v. Bureau of Indian Affairs,

153 F.3d 1000 (9th Cir. 1998) .............................................................................5, 8

Johnston Oyster Co. v. Malcom Baldridge,

704 F.2d 1060 (9th Cir. 1983) ...............................................................................12

Levine v. Vilsack,

587 F.3d 986 (9th Cir. 2009) ...................................................................................4

Lincoln v. Vigil,

508 U.S. 182 (1993) .............................................................................................. 10

Lujan v. Defenders of Wildlife,

504 U.S. 555 (1992) ................................................................................................4

Managed Pharmacy Care v. Sebelius,

705 F.3d 934 (9th Cir. 2012) .................................................................... 12, 16, 21

Marmolejo-Campos v. Holder,

558 F.3d 903 (9th Cir. 2009) ................................................................................. 17Marsh v. Or. Natural Res. Council,

490 U.S. 360 (1989) .............................................................................................. 12



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Case No. 11-cv-04846 Memorandum in Support of Defendants Motion for Summary Judgment iv

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Morales-Izquierdo v. Gonzales,

486 F.3d 484 (9th Cir. 2007) ................................................................................. 21

Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto Ins. Co.,

463 U.S. 29 (1983) ................................................................................................ 12

Natl Parks & Conservation Assn v. U.S. Dep't of Transp.,

222 F. 3d 677 (9th Cir. 2000) ................................................................................13

Nat'l Wildlife Fed'n v. Burford,

871 F.2d 849 (9th Cir. 1989) ................................................................................. 23

Northwest Ecosystem Alliance v. U.S. Fish & Wildlife Serv.,

475 F.3d 1136 (9th Cir. 2007) ...............................................................................13

Occidental Eng'g Co. v. INS,

753 F.2d 766 (9th Cir. 1985) ...................................................................................3

Pac. NW. Generating Coop. v. Bonneville Power Admin.,

596 F.3d 1065 (9th Cir. 2010) ................................................................................. 5

Pinnacle Armor Inc., v. United States,

648 F.3d 708 (9th Cir. 2011) ...................................................................................5

Pritkin v. Dep't of Energy,

254 F.3d 791 (9th Cir. 2001) ...................................................................................4

Rank v. Nimmo,

677 F.2d 692 (9th Cir. 1982) ............................................................................ 6, 14

Rapanos v. United States,

547 U.S. 715 (2006) .............................................................................................. 21

Rapides Reg'l Med. Center. v. Sec'y, Dep't of Veterans Affairs,

974 F.2d 565 (5th Cir. 1992) ...................................................................................8Pharm. Research & Mfrs. of Am. v. Thompson,

259 F. Supp. 2d 39(D.D.C. 2003);. ................................................................ 15, 20



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Case No. 11-cv-04846 Memorandum in Support of Defendants Motion for Summary Judgment v

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Sierra Club v. Mainella,

459 F. Supp. 2d 76 (D.D.C. 2006) .......................................................................... 3

Skidmore v. Swift & Co.,

323 U.S. 134 (1944) .............................................................................................. 16

Solid Waste Agency of N. Cook Cnty. v. Army Corps,

531 U.S. 159 (2001) .............................................................................................. 21

Strickland v. Morton,

519 F.2d 467 (9th Cir. 1975) ...................................................................... 9, 10, 12

Topgallant Group., Inc. v. United States,

704 F. Supp. 265 (D.D.C. 1998) ........................................................................... 11

U.S. v. Riverside Bayview Homes, Inc.,

474 U.S. 121 (1985) .............................................................................................. 21

United States v. Mead,

533 U.S. 218 (2001) .............................................................................................. 16

Webster v. Doe,

486 U.S. 592 (1988) ............................................................................................5, 7

STATUTES

5 U.S.C. 701 ............................................................................................................. 4

5 U.S.C. 706 ............................................................................................... 1, 12, 14

38 U.S.C. 8101 ........................................................................................................ 9

38 U.S.C. 8151 ............................................................................................passim

38 U.S.C. 8153 ..............................................................................................passim

38 U.S.C. 8161 ........................................................................................................ 2

38 U.S.C. 8162 ........................................................................................................ 2

38 U.S.C. 1718, 2013(a)(3) .................................................................................22



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REGULATIONS

38 CFR 17.142 ......................................................................................................... 15



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Case No. 11-cv-04846 Memorandum in Support of Defendants Motion for Summary Judgment page 1

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MEMORANDUM OF POINTS AND AUTHORITIES ANDSUGGESTION OF LACK OF JURISDICTION

INTRODUCTION

The United States Department of Veterans Affairs (VA) operates one of

the largest health care systems in the country. To support its mission, VA has a

large inventory of real property that includes the land on which VA medical

centers (VAMCs), operated by VAs Veterans Health Administration (VHA),

are located. In 1996, Congress significantly expanded the ways in which VA could

use real property controlled by VHA, by authorizing the Secretary, under 38

U.S.C. 8151-53, to, at his discretion, enter into sharing agreements that allow

other entities to share or use VA land and space, if the Secretary determined thatsuch agreements are in the best interests of the VA medical care program.

Congress gave VA this sharing authority to strengthen the medical programs at its

facilities, and improve the quality of care provided to Veterans, with revenue

generated through such agreements credited to the sharing VA facilities medical

accounts. 38 U.S.C. 8151, 8153(b).

Plaintiffs, who describe themselves as Veterans with severe mental

impairments and/or brain injuries, have sued under the Administrative Procedure

Act (APA), 5 U.S.C. 706(2), seeking an order vacating existing agreements to

share space on VAs West Los Angeles (WLA) medical center campus. The

APA does not permit such challenges to proceed. Where, as here, Congress has

committed an agency action to the agencys discretion, judicial review is not

available. Therefore, Plaintiffs APA claim must fail. Even if the Court could

review Plaintiffs claim, it should be denied because VAs decisions to enter into

these sharing agreements were not arbitrary and capricious or contrary to law.

Case 2:11-cv-04846-SJO-MRW Document 116 Filed 04/10/13 Page 10 of 33 Page ID#:3736


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GLA from executing under 38 U.S.C. 8151-8153 (the statutes that authorize

enhanced sharing agreements) any agreements that do not concern the sharing of

health-care resources.Id. at 6 (citing FAC Req. for Relief).3

The Court

apparently understands Plaintiffs to be trying to challenge VAs decisions to enter

certain ESAs on the WLA campus.4

Plaintiffs pleadings to date suggest that their

challenge is even narrower: Plaintiffs do not appear to have identified any basis

for their challenge other than contending that the land at issue is not a health-care

resource under 38 U.S.C. 8151-53 and that at least some of the ESAs do not

benefit Veterans.

ARGUMENT

I. VAS ACTIONS ARE UNREVIEWABLE BECAUSE THEY ARECOMMITTED TO AGENCY DISCRETION

A court conducting APA judicial review determines whether or not as a

matter of law the evidence in the administrative record permitted the agency to

make the decision it did. Occidental Engg Co. v. INS, 753 F.2d 766, 769 (9th

Cir. 1985).

5

[B]efore any review at all may be had [under the APA], though, a

3Plaintiffs do not specify which agreements they allege do not concern the

sharing of health-care resources. FAC Req. for Relief;see generally FAC 311-15.4 See Order Granting In Part & Denying In Part Pls. Mot. To Supplement the

Administrative R. (Order Supp. AR) Jan. 22, 2013 (ECF No. 108) (addressingscope of administrative record); and the Administrative Record (AR), assupplemented. Defs. Notice of Filing Administrative R., Oct. 22, 2012 (ECF No.96); Defs. Notice of Filing Suppl. to Administrative R., Nov. 20, 2012 (ECF No.98); Defs. Notice of Filing Supp. to Administrative R., Feb. 19, 2013 (ECF No.

112). In addition, Defendants are filing concurrently with their summary judgmentmotion additional pages of documents that VA recently determined should beincluded in the administrative record. See Defs. Notice of Filing Supp. toAdministrative R.(filed herewith) (ECF No. 115).5

Where an agency action is upheld in an APA challenge, summary judgment isappropriately entered for defendants. Sierra Club v. Mainella, 459 F. Supp. 2d 76,90 (D.D.C. 2006); Pinnacle Armor v. United States, No. 1:07-cv-01655, LJO DLB,2012 WL 5307666 (E.D. Cal. Oct. 26, 2012).



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party must first clear the hurdle of [5 U.S.C.] 701(a). Heckler v. Chaney, 470

U.S. 821, 828 (1985).6 In relevant part, that section of the APA precludes review

over agency action [that] is committed to agency discretion by law. 5 U.S.C.

701(a)(2);Heckler, 470 U.S. at 828, 830, 843. APA claims can only proceed

against the government, which otherwise enjoys sovereign immunity from suit, to

the extent the APA waives the governments sovereign immunity. Therefore, when

a challenged action falls within 701(a)(2)s exception to APA review for actions

committed to an agencys discretion, the APAs waiver of sovereign immunity

does not extend to that claim, and the court, therefore, lacks subject matter

jurisdiction over the matter and must dismiss such a claim. See e.g., E.J. FriedmanCo. v. United States, 6 F.3d 1355, 1359 (9th Cir. 1993).

7

6Also before any review may be had, Plaintiffs must establish that they have

standing. Pritkin v. Dept of Energy, 254 F.3d 791, 796-97 (9th Cir. 2001). Whilethis Court, in considering Defendants Motion to Dismiss, found that Plaintiffs hadadequately pled standing, the burden for establishing standing is more rigorous atthe summary judgment stage of a case than at the motion to dismiss stage.Lujan v.

Defenders of Wildlife, 504 U.S. 555, 561 (1992). Moreover, the Courts holdingseems based on its understanding that Plaintiffs APA claim challenged VAsharing space pursuant to ESAs, as opposed to EULs. Order on MTD n.5(Plaintiffs injury is connected to the DVAs affirmative act to enter into land-useagreements pursuant to ESAs instead of EULs). In subsequent orders, though, theCourt has seemed to understand the APA claim as a broader challenge to thelawfulness of WLA ESAs. See Order Granting in part & Denying in partDefs.Mot. for Recons. (Order on Recons.) 7, June 19, 2012 (ECF No. 87).Plaintiffs do not have standing to bring such a claim because they suffered nodirect injury from the allegedly unlawful agreements, and, even if they hadsuffered such injury, no judicial declaration could redress it.Lujan, 504 at 560-61.The Court acknowledged as much when it noted that If Plaintiffs prevail on thisclaim and the existing land-use agreements are deemed unlawful, Plaintiffscertainly hope that this land will be used to construct permanent supportinghousing for their benefit. But . . . Plaintiffs recognize that if the existing land useagreements are determined to be unlawful, the Government could choose to use the

land for any lawful purpose, and the Government might notchoose to use the landto create permanent supportive housing.) Order on Recons. 7. (emphasis added).Such an attenuated claim cannot establish Plaintiffs standing at this stage of thecase. See Levine v. Vilsack, 587 F.3d 986, 993 (9th Cir. 2009) (even confiden[t]speculation rejected in standing analysis).7

A federal court can always consider whether it has subject matter jurisdiction,see Fed. R. Civ. P. 12(h)(3), and the Ninth Circuit on multiple occasions hasaddressed the committed to agency discretion exception to the APA in thecontext of summary judgment rulings. See, e.g., Strickland v. Morton, 519 F.2d



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Although the exception from APA review applying to acts committed to

agency discretion is a narrow one, it applies where, as here, statute[s are] drawn

in such broad terms that in a given case there is no law to apply,Pac. NW.

Generating Coop. v. Bonneville Power Admin., 596 F.3d 1065, 1075 n.7 (9th Cir.

2010) (citingHeckler, 470 U.S. at 830), thereby leaving the court with no

meaningful standard against which to judge the agencys exercise of discretion.

Pinnacle Armor Inc., v. United States, 648 F.3d 708, 719 (9th Cir. 2011) (citing

Heckler, 470 U.S. at 830).

In evaluating whether a statute is so drawn, courts look to the language of

the statute itself, its overall structure, and whether it involves an area of executiveaction in which the courts have been hesitant to intrude. Webster v. Doe, 486 U.S.

592, 601 (1988);Helgeson v. Bureau of Indian Affairs, 153 F.3d 1000, 1003 (9th

Cir. 1998).8 Under such an analysis, it is clear that VAs decisions to enter into the

challenged ESAs were committed to VAs discretion, and therefore are not subject

to judicial review.

467, 468 (9th Cir. 1975). At the time Defendants filed their dismissal motion,Plaintiffs claims were so indeterminate that their focus was not entirely clear. SeeOrder MTD (clarifying, among other things, what final agency action Plaintiffswere alleging). Once the Court clarified Plaintiffs claims in its orders of March16, 2012 (ECF No. 70), June 19, 2012 (ECF No. 87), and Jan. 22, 2013 (ECF

No.108), the fact that Plaintiffs are challenging agency actions that are committedto the agencys discretion became more apparent.8

Some courts evaluate whether an act is committed to agency discretion based onthe language of the statute and whether the general purpose of the statute would

be endangered by judicial review. Pinnacle Armor, Inc. v. United States, 648F.3d 708, 719 (9th Cir. 2011);Harkonen v. United States Dept of Justice, No.C12-629 CW, 2012 WL 6019571 at *14 (N.D. Cal. Dec. 3, 2012). Under thisframework, too, Plaintiffs claims are committed to agency discretion by law

because judicial review is precluded where courts have neither standards norexpertise to effectuate such purpose. See Pinnacle, 648 F.3d at 720. Here, thesharing program is designed to strengthen VA medical programs,see 38 U.S.C. 8151, and review of ESA decisions by courts that have neither the standards norexpertise to strengthen such programs could instead endanger them. Id.



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38 U.S.C. 8153 vests complete discretion in the Secretary to enter or not

enter into enhanced sharing agreements (ESAs). The statute provides, in

relevant part, that to effectively utilize health-care resources the Secretary may

make agreements for the sharing of health-care resources between VA and any

health-care provideror other entity or individual when the Secretary determines

it to be in the best interestof the prevailing standards of the Department medical

care program. 38 U.S.C. 8153(a)(1) (emphasis added).

A. The Language of 8153 Shows TheDecisions to Enter ESAs Are Committed to VAs Discretion

Section 8153 contains at least four separate textual indicators that

Congress intended the decision to enter into an ESA to be entrusted exclusively to

the VA Secretary, and that the statutory language provides no law against which a

court might assess the Secretarys decision to enter into an ESA:

First, and perhaps most significantly, Section 8153 does not require the

Secretary to enter into any sharing agreements. The language is precatory, rather

than mandatory providing that the Secretary may enter into such agreements.

May does not mean must or should. Instead, 8153 contains language that

the Ninth Circuit has repeatedly found commits an agencys decision to the

agencys discretion, and makes it unreviewable. See E.J. Friedman Co. v. United

States, 6 F.3d 1355, 1359 (9th Cir. 1993) (no APA review available where statute

provides that IRS may, in its discretion, issue a certificate of discharge);9Rank v.

Nimmo, 677 F.2d 692, 699 (9th Cir. 1982) (agency decision was unreviewable

because the statutory use of the word may helped make clear that Congress

intended to vest the widest discretion possible in the Administrator).

9Conversely, courts have relied on the presence of mandatory language to find

jurisdiction. See, e.g.,Beno v. Shalala, 30 F.3d 1057, 1066 (9th Cir. 1994).



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Second, Section 8153 explicitly conditions entering into an ESA on the

Secretary[s] determin[ation] of what is in the VA medical programs best

interest. 38 U.S.C. 8153(a)(1). Thus, the touchstone for whether an ESA is

appropriate is only whether the Secretary determines it to be the programs best

interest, not whether it isin the agencys best interest in some objective way. See

Webster, 486 U.S. at 600 (agencys termination decision not reviewable because

the statute provided for termination when the directordeemedit necessary or

advisable in the interests of the United States, not when dismissal is necessary or

advisable to those interests);Ellison v. Connor, 153 F.3d 247, 254 (5th Cir. 1998)

(court lacked jurisdiction when law authorized Secretary to act whenever he shalldeem it to be advantageous to the Government) (internal citation omitted);

Forsyth Cnty. v. Army Corps of Engrs, 633 F.3d 1032, 1041 (11th Cir. 2011) (no

review when statute provides that the Secretary of the Army is authorized to act

for such periods, and upon such terms and for such purposes as he may deem

reasonable in the public interest) (internal citation omitted).

Third, 8153 allows but does not require VA to enter ESAs that, in the

judgment of the Secretary, are in the best interestof the prevailing standards of

the Department medical care program. 38 U.S.C. 8153(a)(1) (emphasis added).

By providing for an assessment of what is in the programs best interest, rather

than delineating a list of provisions or factors that the ESAs should meet, the

statute provides still greater discretion to the Secretary, and no judicially

manageable benchmarks to govern judicial review. See, e.g. Webster, 486 U.S. at

600.

Fourth, the statute provides that the Secretary may enter into ESAs with

any health-care provider orotherentity or individual. 38 U.S.C. 8153(a)(1)

(emphasis added). It could have restricted who VAs sharing partners could be; in



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fact, a prior version of the statute provided just such a restriction. See H.R. Rep.

No. 104-690 at 11 (1996). In enacting the current version of 8153(a)(1),

however, Congress specifically chose to ease earlier restrictions on agency

discretion to enter into sharing agreements. See Pub. L. 104-262, Title III(A)

(1996). Congress use of the words any and other removed any limitation on

who VAs sharing partners could be, reflecting Congress intent to give the

Secretary maximum discretion to choose how, and with whom, the agency should

enter into sharing agreements. See H.R. Rep. No. 104-690 at 11.10

B. The Statutory Framework and Legislative History Show VADecisions to Enter ESAs Are Committed to VAs Discretion

The statutory structure confirms this Congressional intent. See Helgeson,

153 F.3d at 1003 (consider overall statutory structure in determining whether act

has been committed to agency discretion). Congress did not include any guidelines

for judicial review and did not require the Secretary to promulgate any regulations,

which might have constituted law that could be applied.11

Also, Section 8153 is

10 Another indication that Congress intended to commit to the VAs total discretionthe decision to enter ESAs is Congress forbearing from setting standards by whicha court could review these decisions and declining to provide for judicial review ofthese agreements. Instead, the statute provides an alternate oversight mechanism:annual VA reports to Congress about its sharing agreements. See 8153(g);

Rapides Regl Med.Ctr. v. Secy, Dept of Veterans Affairs, 974 F.2d 565, 575 (5thCir. 1992) (Congress retained for itself the measuring stick . . . by which toevaluate the success of the sharing program now recodified at 8153: annualreports from the VA tracking activities under the program.) (Internal citationomitted). Recognizing that Congress intended to maintain oversightresponsibilities for itself, and to foreclose court oversight, it would thwart theCongressional scheme were the Court to find it has jurisdiction to review VA

decisions to enter sharing agreements pursuant to this statute.11To the extent Plaintiffs try to rely on the statutes introductory language about

sharing health-care resources, the Court is respectfully referred to the discussionbelow about how the resources at issue in the challenged ESAs fall within VAspermissible interpretation of the statutes broad terms. See infra II.A.2. Moreover,introductory language about the statutes purposes can hardly be said to be veryconfining. See, e.g., Strickland, 519 F.2d at 469; see also Sierra Club v. USFWS,

No. 11-993, 2013 WL 1111285 (D.D.C. Mar. 19, 2013) (finding Servicesdetermination was a decision committed to the Services discretion by law and thus



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located in Subchapter IV of the U.S. Codes chapter 81. This subchapter is titled

Sharing ofMedical Facilities, Equipment and Information (emphasis added).

Congress did not provide a definition of medical facilities in Subchapter IV. It is

therefore instructive to look at the definition of medical facility that appears in

another subchapter of chapter 81. A medical facility is defined in subchapter I as

any facility or part thereof which is, or will be, under the jurisdiction of the

Secretary for the provision of health-care services (including hospital, nursing

home, or domiciliary care or medical services), including any necessary building

and auxiliary structure, garage, parking facility, mechanical equipment, trackage

facilities leading thereto, abutting sidewalks, accommodations for attendingpersonnel, and recreation facilities associated therewith. 38 U.S.C. 8101(3).

Congress broad definition of the types of facilities that fall within this category

indicates that VA has broad discretion to choose what resources are appropriate

subjects of ESAs.12

Legislative history can also shed light on whether an action is committed to

an agencys discretion. See, e.g., Strickland v. Morton, 519 F.2d 467, 469 (9th Cir.

1975). The legislative history of 8153 makes clear that Congress intended this

statute to expand the scope of ESAs into which the Secretary could enter. Prior to

8153s enactment in 1996, VA was authorized to enter ESAs only with certain

specified health-care entities for the mutual use or exchange of use of specialized

medical resources, a narrowly defined term. H.R. Rep. No. 104-690 at 11 (1996).

unreviewable because statutes clear purpose and goal does not provide theCourt with meaningful standards).12

Nothing in the text of 8151-8153 limits the subjects of ESAs to medicalfacilities, as defined in 8101(3). As described below, VA has exercised its

broad discretion to interpret the phrase health-care support or administrativeresource, contained in the health-care resource definition at 38 U.S.C. 8152(1)to include VHA space and land. See infra II.A.2. VHA space and landencompasses a range of real property assets, including medical facilities.



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Recognizing that these restrictions unduly constrained the Secretarys discretion to

determine what types of agreements might be in the agencys best interests,

Congress enacted the present version of 8153 to ease these various restrictions

and give the Secretary far greater flexibility as to when a VA facility may enter

into such a contract. See id. Congress contemplated that VA would broadly

construe this new authority. Id.13

C. ESA Decisions Are Typical of Actions Committed toAgency Discretion

Courts have found that where an agency is far better equipped than the

courts to deal with the many variables involved in the proper ordering of itspriorities, an agencys action is committed to its discretion. See, e.g.,Lincoln v.

Vigil, 508 U.S. 182, 193 (1993) (citingHeckler, 470 U.S. at 831-32). Decisions to

enter ESAs, which involve assessing the agencys objectives and available

resources, involve just such determinations. See S. Rep. No. 104-372 at 45 (1996)

(statement of Kenneth W. Kizer, Under Secretary for Health, Department of

Veterans Affairs) (allowing VA increased flexibility to share resources with

partners in private and public sectors will best allow VA to allocate its resources to

serve veterans); H.R. Rep. No. 104-280 at 892 (1995) ([t]he amendments [to

8153], developed with an eye to both the difficult budget environment and the

dynamic marketplace within which the VA health-care facilities are operating,

13The post-enactment history of 8153 also demonstrates that Congress intended for

ESA decisions to be committed to VAs discretion. Congress has been informed innumerous ways about the broad discretion VA understands it has with respect to

entering ESAs. See infra II.A.2. Even while Congress has received testimonyabout VA believing it has such broad discretion, and has amended the EnhancedSharing Authority statute a number of times,see infra n.32, Congress has notnarrowed the definition of health-care resources, restricted the purposes forwhich a health-care resource could be used pursuant to a sharing agreement,limited who VAs sharing partners could be or included mandatory standards or

processes by which VA must determine whether entering a proposed sharingagreement is in the best interest of the VA medical program. It is clear, therefore,that Congress did not intend to fetter VAs discretion to enter into ESAs.



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reflect a belief that these facilities need far greater flexibility than existing law

affords them to work out contractual arrangements with other providers, institutes

and entities to share health-care resources).

Decisions like those at issue here, regarding how federal resources like land

will be used, have been deemed classic examples of decisions traditionally

committed to agency discretion. See, e.g.,Strickland, 519 F.2d at 471, n.6

(discretionary land classification decisions are typical of the type of cases raising

non-reviewable category issues);Drakes Bay Oyster Co. v. Salazar, No. 12-cv-

06134-YGR, 2013 WL 451860, at *16 (N.D. Cal. Feb. 4, 2013) ([l]ike other

zoning and land use questions, this issue will be resolved by policymakers chargedwith weighing the conflicting views and priorities of society as part of the decision

making process).14

Likewise, VA is best placed to determine the optimal uses for

its space, land, and property, because it is involved on a daily basis with the

administration of such resources. For this reason, the one court to have previously

addressed the discretionary nature of 8153 concluded that this provision yields

great discretion to the Secretary and shields the Secretarys action from judicial

review. Gibbons v. Fronton, 533 F. Supp. 2d 449, 456(S.D.N.Y. 2008)

(dismissing plaintiffs Federal Tort Claims Act claims because VAs decision to

enter a contract [pursuant to 8153] falls within FTCAs discretionary function

exception).15

14Similarly, agency contracting decisions, like those at issue here, have been found

to be committed to agencies discretion, and therefore unreviewable. See, e.g.,Topgallant Grp., Inc. v. United States, 704 F. Supp. 265 (D.D.C. 1998) (Military

Sealift Commands lifting of a stay suspending performance by contractor isunreviewable because committed to agency discretion by law where statuteauthorized agency to make determination based upon best interest of the UnitedStates).15

By challenging VAs decisions to enter into ESAs with specific sharing partners,Plaintiffs are essentially asking the court to substitute its judgment for theagencys. This is precisely what is not permitted under the APA. See, e.g.,

Johnston Oyster Co. v. Malcom Baldridge, 704 F.2d 1060 (9th Cir. 1983);Strickland, 519 F.2d at 472; City & County of San Francisco v. United States, 443



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II. EVEN IF VAS DECISIONS ARE REVIEWABLE, THEY DO NOT

VIOLATE THE APA

Even if VAs decisions to enter into each of the challenged ESAs are

reviewable, summary judgment should be granted for Defendants because these

decisions were not arbitrary, capricious, an abuse of discretion, or otherwise not

in accordance with the law, in violation of 5 U.S.C. 706(2)(A). Review under

this standard is highly deferential, and an agency decision must be upheld provided

the agency does not rel[y] on factors which Congress has not intended it to

consider, entirely fail[] to consider an important aspect of the problem, [or] offer[]

an explanation for its decision that [either] runs counter to the evidence before theagency or is so implausible that it could not be ascribed to a difference in view or

the product of agency expertise. Motor Vehicle Mfrs. Assn v. State Farm Mut.

Auto Ins. Co., 463 U.S. 29, 43 (1983). Under this narrow standard of review, a

court may not substitute its judgment for that of the agency charged with

administering the program at issue. Marsh. v. Or. Natural Res. Council, 490 U.S.

360, 378 (1989). In order to prevail on this claim, Plaintiffs must meet a heavy

burden,see Managed Pharmacy Care v. Sebelius, 705 F.3d 934, 943 (9th Cir.

2012), which cannot be met here. Even when an agency explains its decisions

with less than ideal clarity, a reviewing court will not upset the decision on that

account if the agencys path may reasonably be discerned. Alaska Dept of

Envtl. Conservation v. EPA, 540 U.S. 461, 496 (2004)(citations omitted). Because

agency actions are presumed to be valid, agency decisions must be affirmed if a

reasonable basis exists in the administrative record for the decision, regardless of

how explicitly the agency identified that reasonable basis. Nw. Ecosystem Alliance

F. Supp. 1116, 1123 (N.D. Cal. 1977)) (the cause of action alleges no more thanthat the award . . . was not in the public interest. This squarely presents the issueof whether the Secretarys judgment was or was not correct).



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v. U.S. Fish & Wildlife Serv., 475 F.3d 1136, 1147 (9th Cir. 2007). Where there is

conflicting evidence in the record before the agency, the agencys determination is

accorded deference. Natl Parks & Conservation Assn v. U.S. Dept of Transp.,

222 F.3d 677, 682 (9th Cir. 2000). Finally, an agencys construction of a statute it

is entrusted to administer must prevail if it is a reasonable construction of the

statute, whether or not it is the only possible interpretation or even the one a court

might think best. Holder v. Martinez Gutierrez, 132 S.Ct. 2011, 2017 (2012).

A. VA Acted In Accordance With Law In Entering Into SpaceSharing Agreements at its WLA Campus

Although, as explained above, Congress defined health-care resource in

broad terms, the language of the statute itself reflects Congress view that

agreements to share space are agreements to share health-care resources. Section

8152(1) provides that [t]he term health-care resource includes hospital care and

medical services, . . . any other health-care service, and any health-care supportor

admini strative resource. 38 U.S.C. 8152(1) (emphasis added). Another

provision explicitly refers to space as a health-care resource. See 38 U.S.C.

8153(a)(3) (If the health-care resource required is a commercial service, the use of

medical equipment orspace, or research) (emphasis added).16 Thus, to the

extent that Plaintiffs assertion that the challenged agreements do not concern the

sharing of health-care resources, FAC at 91 (Request for Relief, E) depends upon

a contention that no land or building on the grounds of VAs WLA medical center

is a health-care resource, the claim is flatly contradicted by the statute itself.

16While Section 8153(a)(3) applies specifically to VAs acquisition of health-care

resources, rather than VAs selling (or leasing) of health-care resources, readingthe statute as a whole shows that because space is encompassed within health-care resource, VA can permissibly sell, or buy, the use of space pursuant toSection 8153.



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Any other basis for Plaintiffs APA claim calls into question either VAs

interpretation of the statute which, if reviewable at all, must be afforded great

deference or VAs managerial decisions to enter the specific ESAs at issue.

Either way, VAs statutory interpretations, policy choices, and specific managerial

decisions must be upheld.

1. VAs Reading of Section 8153 Must Be Accorded Deference.Even if an agency is not afforded the widest discretion possible, making

its actions immune from judicial review, the Court must nevertheless defer to the

agencys [broad] discretion where a statute provides an open [definition] of the

bases on which an agency decision may be made. See Rank, 677 F.2d at 699-700.

The broad and ambiguous terms used in 8151-53 confer particularly great

discretion on the agency to decide what criteria it will use in determining whether

and how to exercise its statutory authority. See id. In determining whether the

challenged VA actions are contrary to law within the meaning of 5 U.S.C.

706(2)(B), because the statute is silent or ambiguous with respect to relevant

matters, the question for the court is whether the agencys [interpretation] is based

on a permissible construction of the statute. Chevron U.S.A., Inc. v. Natl Res.

Def. Council, 467 U.S. 837, 842-44 (1984).17

In this inquiry, a court may not

substitute its own construction of [the] statutory provision for a reasonable

interpretation made by [the] agency. Id. at 844. Instead, the court should only

determine whether the agencys interpretation of the statute is rational and

consistent with the statute.NLRB v. United Food & Commercial Workers Union

Local23, 484 U.S 112, 123 (1987).

17 See also Arent v. Shalala ,70 F.3d 610, 616 n.6 (D.C. Cir. 1995) (Noting

considerable overlap between Chevron analysis and State Farms arbitrary,capricious inquiry as to whether, under 706(2)(A), the challenged agency actionmust be set aside as not in accordance with law).



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Because 8151-8153 are silent as to critical matters such as how the

Secretary18

is to determine whether entering a particular ESA is in the best

interest of the VA medical program,19 and leave some ambiguity as to what

constitutes a health-care resource,20 this deferential standard applies to VAs

interpretation of ambiguous terms and gaps in the statute, which is set forth in

VHAs policy directives and handbooks, and reflected in VAs decisions to enter

individual ESAs. See generally AR 16-88 (policy directives and handbooks); AR

191-1685 (individual ESA decisions). The circumstances here support the

application ofChevron deference to both VAs overall interpretation of 38 USC

8151-53 and the specific decisions to enter ESAs that Plaintiffs challenge. SeeBarnhart v. Walton, 535 U.S. 212, 222 (2002) (degree of deference depends upon

the interstitial nature of the legal question, the related expertise of the Agency, the

importance of the question to administration of the statute, the complexity of [the]

administration, and the careful consideration the Agency has given the question

over a long period of time). Indeed, an agencys implicit interpretation of a

statute may be expressed through its explicit determination[s] in making specific

decisions. SeeManaged Pharmacy Care v. Sebelius, 705 F.3d 934, 946 (9th Cir.

2012).

18Decision-making authority is delegated from the Secretary to the Under

Secretary for Health in 38 CFR 17.142 and from the Under Secretary to medicalcenter directors in VHA Handbooks 1660.01, AR 40, 44-45, and 1820.01, AR 59,64-65. The Deputy Assistant Secretary for Acquisition and Materiel Managementgenerally appoints VA selling officials. AR 55.19

The undefined term best interest has been found to be a broad and ambiguous

term capable of multiple permissible interpretations. See, e.g., Pharm. Research &Mfrs. Of Am. v. Thompson, 259 F. Supp. 2d 39, 72 (D.D.C. 2003); affd, 362 F.3d817 (D.C. Cir. 2004). Moreover, an agencys consideration of multiple factorscontributing to the best interest of the agency program and its beneficiaries in theaggregate has been upheld as reasonable even when the agency decision might notserve the best interest of some program beneficiaries. See id.20

For example, Section 8152 does not define health-care support oradministrative resource. See 38 U.S.C. 8152(1).



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Chevron deference is particularly appropriate here because, in managing

space available at its WLA medical center, VA must balance competing interests

based on the health-care and related needs of Veterans, as well as a number of other

statutes and considerations.22 Agency decisions about whether to enter into

agreements are generally afforded a significant degree of deference.23

At a minimum, the level of deference generally given to an agencys

unpublished orders is appropriate here. Under this standard, internal agency

guidance that lacks the force of law is given deference on a sliding scale,

depending upon the thoroughness evident in its consideration, the validity of its

reasoning, its consistency with earlier and later pronouncements, and all thosefactors which give it power to persuade, if lacking power to control. United States

v. Mead, 533 U.S. 218, 228 (2001)(quoting Skidmore v. Swift & Co., 323 U.S.

134, 140 (1944)); accordMarmolejo-Campos v. Holder, 558 F.3d 903, 909 (9th

Cir. 2009). Given the reasonableness of VAs approach to implementing the

sharing authority statute, the agencys reading of the statute should be credited.

22See, e.g., WLA Medical Center, Veterans Programs Enhancement Act of 1998

(VPEA) Master Plan, AR 151-189, at AR 155 (VA required to pursue goal ofcreating a therapeutic and recovery oriented environment on the campus forVeterans to heal); AR161 (development activities on WLA Campus will strive to

benefit the Veteran population in harmony with the surrounding community, andcomply with all applicable laws, codes, ordinances, and regulations, including butnot limited to pertinent environmental and historic preservation laws); and AR174 (use of WLA campus to be based on physical and operational objectivessuch as providing recreational facilities for Veterans and partnering with thecommunity to make the campus esthetically pleasing as well as mission

objectives such as developing physical environment that supports the delivery ofhealth care, education, and research).23

See, e.g.,Am. Fedn of Govt Empls. v. Brown, 680 F.2d 722 (11th Cir. 1982)(deference to agency decision depends on breadth of discretion given to agency;extent to which challenged action is product of political, economic, or managerialchoices; and extent to which challenged action is based on specialized knowledgeor expertise.).



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2. VAs Interpretation Of Its Authority Under 8153 IsPermissible.

VA has permissibly interpreted 8153s inclusion of space as a health

care resource to mean that [e]nhanced sharing agreements for the use of VA

space (including parking, outdoor recreational facilities, and vacant land) are

authorized under 38 U.S.C. Section 8153. AR 26. This is consistent with VAs

interpretation of health care support services and administrative resources as

used in Section 8152. VA has stated that [h]ealth care support [services] serve

medically-related purposes (e.g., biomedical equipment repair, patient transport),

AR 43, while [a]dministrative resources include services not unique to the

provision of medical care, but deemed necessary to support the operation of a

medical center (e.g., transcription services, ground maintenance). Id. It stands to

reason that space, including land and buildings that form part of the WLA

medical center, can reasonably be understood to support the operation of a

medical center, even though, like transcription services or grounds maintenance, it

might not be unique to the provision of medical care. AR 43. Indeed, space and

land under VHA control are necessary to enable VA to provide medical care. To

the extent that Plaintiffs challenge VAs entry into ESAs on the ground that these

resources are not unique to the provision of medical care, they are challenging a

reasonable and longstanding statutory interpretation by the agency Congress

entrusted with broad discretion to decide whether and when to enter ESAS. Id.

VAs interpretation of best interest is, generally, that an ESA should be

executed only when the agency determines, first, that the contract will not result

in the diminution of existing levels of services to [V]eterans, and, second that the

agreement is either necessary to maintain an acceptable level and quality of

services to [V]eterans or will result in the improvement of services to Veterans.



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AR 45. VA understands that determining the best interest of the VA medical

program includes consideration of the contemplated use of VA space. Id. Among

other factors, VA considers the potential impact of a proposed agreement on

patient privacy, VA computer systems, telecommunications and data, parking,

and fire health, and safety and security and law enforcement issues in sharing the

use of VA space. AR 26.

Thus, in order to exercise the Secretarys authority pursuant to 8153, VA

has interpreted both health care resource and best interest in reasonable,

practical ways which enable the agency to exercise its sharing authority

appropriately. Further, as discussed below, VAs decisions to enter specific ESAs

demonstrate the agencys implicit interpretation that agreements to sell space

may benefit Veterans either by reducing VAs costs to maintain under-utilized

resources or by providing revenue that VA uses to support Veteran health care

programs at WLA even where the ESAs permit the space to be used to benefit non-

Veterans.

If there were any doubt that VAs interpretation of 8153 is permissible,

such doubt is eliminated by Congress awareness and implicit acceptance of these

interpretations. It is well established that an agencys interpretation of a statute

may be confirmed or ratified by subsequent congressional failure to change that

interpretation, State Farm, 463 U.S. at 45, particularly where the inference of

congressional approval is supported by more than mere congressional inaction.

Haig v. Agee, 453 U.S. 290, 300 (1981) (internal citation omitted). Here, the

ample evidence of . . . congressional familiarity with the administrative

interpretation at issue, Cape Cod Hosp. v. Sebelius, 630 F.3d 203, 214 (D.C. Cir.

2011) (citation omitted), supports the conclusion that Congress failure to change



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the statute to preclude VAs interpretations establishes Congress acceptance of

VAs interpretations.

VAs annual ESA reports have informed Congress that agreements for the

sharing of space, facilities, and administration, comprise a significant portion

of VA ESAs. See, e.g. AR 116.012, 116.023, 116.044, 116.058, 116.072, 137.

Additionally, VA has made clear that the benefit provided to the VA medical

program by an ESA is often revenue, stating that [t]he sharing authority is . . . a

key mechanism . . . in generating revenues, AR 98, and that the 1996 expansion26

of the definition of health care resources enables VA to offset its costs and

establish revenue streams which are retained at the VAMCs providing the

services where they can, in turn, be used to enhance VAs services to its veteran

beneficiaries. AR 100-101.27

Testimony before its oversight committees provided Congress with further

information about VAs use of ESAs. For example, the GAOs Director of

Physical Infrastructure testified that VA may enter into sharing agreements to

provide the use of VHA space (including parking, recreational facilities, and

vacant land 28 and explained that VA uses sharing agreements to generate financial

benefits.29 In addition, Congress has received testimony about how VA exercises

26VA also noted that These changes greatly enhance VA flexibility and

opportunity to purchase and to sell health care resources. And significantly, as therange of sharing opportunities has broadened, the cost effective delivery of high-quality medical care to VA patients has increased. AR 96.27

Some annual reports also include charts showing the revenue that VA has earnedfrom selling space and other resources within each fiscal year. See, e.g., AR115, 127. VA has received millions of dollars in proceeds annually from sharing

VHA space and land nationwide, including through ESAs at the WLA campus.See AR 94-131.28

Assessing Capital Asset Realignment for Enhanced Services and the Future ofthe U.S. Department of Veterans Affairs Health Infrastructure: Hearing Beforethe H. Comm. on Veterans Affairs, 111th Cong. 79 (2009) (2009 Hearing)(statement of Mark L. Goldstein, Director, Physical Infrastructure, U.S.Government Accountability Office).29

Id. at 78.



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its discretion under 8153 to enter into certain types of agreements, including

agreements allowing VA facilities to be used to film television and movie

productions.31 Members of Congress have even received notification before VA

exercised its discretion to enter into specific ESAs.32

Congress intended to review VAs annual reports with an eye toward any

changes to the sharing statute that might be deemed necessary. See 38 U.S.C.

8153(g). Had Congress wished to curtail VAs discretion, it could have amended

the statute to do so, especially since it has amended 8153 on a number of

occasions.33 However, since Congress did not amend the statute either to narrow

the definition of health-care resource, restrict the purposes for which a health-

care resource could be used pursuant to an ESA, limit who VAs sharing partners

could be, or prescribe how VA must determine the best interest of the VA medical

program, Congress has implicitly accepted VAs interpretations. Cape Cod Hosp.,

630 F.3d at 214. While Congress may not have enshrined VAs interpretations as

the only ones permissible under the statute, its failure to overrule an agencys

construction of legislation is at least some evidence of the reasonableness of that

construction, particularly where the administrative construction has been brought

to Congress attention." United States v. Riverside Bayview Homes, Inc., 474 U.S.

121, 137 (1985).34 Accordingly, Congress has implicitly accepted VAs

interpretations of 8153.

31Seeid .

32See, e.g., AR 228-230 (Letter from Richard Sandler to Rep. Henry Waxman

regarding proposed Brentwood School Sharing Agreement (June 16, 1999)).33 Veterans Benefits Act of 1997, Pub. L. No. 105-114, 111 Stat. 2277; VeteransBenefits and Healthcare Improvement Act of 2000, Pub. L. No. 106-419, 114 Stat.1822; Veterans Health Care, Capital Asset, and Business Improvement Act of2003, Pub. L. No. 108-170, 117 Stat. 2042; Pub. L. No. 111-350, 124 Stat. 3677(2011).34

Courts have rejected claims that, by mere inaction, Congress has acquiesced to aparticular agency interpretation. See, e.g., Morales-Izquierdo v. Gonzales, 486F.3d 484, 493 (9th Cir. 2007) (citing Solid Waste Agency of N. Cook Cnty. v. Army



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B. VAs Decisions To Enter ESAs Are Supportedby the Administrative Record, Which ShowsThat Decisions Were Rationally Based OnRelevant Factors

Even if the Court determines that it has jurisdiction, applying the requisite

level of deference, summary judgment should be granted to Defendants. A review

of the Administrative Record demonstrates the appropriateness of VAs ESA

decisions. Plaintiffs have not met and cannot meet the heavy burden they

would have to bear to overcome the presumption of regularity and have this Court

invalidate those decisions. SeeManaged Pharm., 705 F.3d 943;Akiak Native

Cmty v. U.S. Postal Serv., 213 F.3d 1140, 1146 (9th Cir. 2000).

First, the Administrative Record is replete with examples of VAs

designated decision makers certifying that they have made specific

determinations that, under a particular ESA, (1) Veterans will receive priority for

services; (2) the agreement is necessary either to maintain an acceptable level and

quality of services or to improve such services; and (3) that VAs decision has

been made in the interest of the government and provides a benefit to the

community. See, e.g., AR 212 (Brentwood School ESA); AR 237 (Rancho Santa

Corps, 531 U.S. 159, 169 (2001);Rapanos v. United States, 547 U.S. 715, 749(2006)). However, those cases are distinguishable. InMorales-Izqueirdo, forexample, the plaintiff argued that because Congress had acquiesced to an agencys

previous regulation, a more recent one reflecting a different interpretation wasinvalid.Id. at 493. The Ninth Circuit rejected that argument for failure to point[]to anything in the legislative history that discloses congressional acquiescence inthe agency's past practice, and explained that [a] finding of congressional

acquiescence must be reserved for those rare instances where it is very clear thatCongress has considered and approved of an agencys past practice lest the agencybe improperly deprived of the very flexibility Congress intended to delegate. 486F.3d at 493. Here, in contrast, VAs annual reports to Congressional oversightcommittees provide clear evidence that Congress considered and accepted VAsadministrative practices. Moreover, VA is not arguing that Congressionalacquiescence restricts VA to a particular statutory interpretation, which woulddeprive the agency of flexibility, but only that Congress has implicitly acceptedVAs current, longstanding interpretation as a permissible one.



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Ana Botanical Garden ESA); AR 337 (Sodexo Marriott Laundry Services ESA);

AR 1036 (Westside Services ESA).

Second, the record contains ample evidence that VA weighed relevant

factors and reached a determination that on balance the ESAs were in the best

interest of the . . . [VA] medical program. 38 U.S.C. 8153(a)(1). With respect

to some ESAs, VAs best interest determination was based in part on the

anticipated creation of Compensated Work Therapy (CWT) jobs35 or other

employment opportunities for Veterans. See, e.g., AR 296 (Rancho Santa Ana

Botanical Garden); AR 616 (Twentieth Century Fox ESA); AR 674 (U.S. Vets

Initiative; AR 1058 (Farmers Market ESA); AR 1112 (Richmark Entertainment

ESA)). With respect to others, the agencys best interest determination rested

largely on the provision of support services and temporary or transitional housing

to homeless Veterans. See, e.g., AR 449-450; AR 525-526 (Salvation Army ESAs

for Buildings 212 and 207). In making some ESA decisions, VAs best interest

determination was based in part upon availability of recreational opportunities for

Veterans. See, e.g., AR 194 (Brentwood School ESA); AR 384 (UCLA baseball

stadium ESA); AR 827 (Veterans Park Conservancy ESA); AR 880 (Westside

Breakers Soccer Club); accordAR 174 ([p]roved[ing] recreational facilities for

Veterans living on campus is one of the [p]hysical [o]bjectives guiding use of

WLA Campus). Finally, in some instances, VAs best interest determination

was based either partly or entirely on anticipated revenue that would benefit

Veterans and/or a reduction in the cost to VA of maintaining the underlying real

property. See, e.g., AR 204, 276 (Brentwood School ESA); AR 334 (Sodexo

35CWT jobs provide eligible Veterans a chance to learn and improve work skills

and habits in order to transition to more independent living. See 38 U.S.C. 1718, 2013(a)(3).



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Marriott Laundry ESA); AR 412 (Jackie Robinson Baseball Stadium); AR 616

(Twentieth Century Fox ESA).

Thus, applying the highly deferential standard under which agency action is

presumed to be justified, see Natl Wildlife Fedn v. Burford, 871 F.2d 849, 856

(9th Cir. 1989), VAs challenged decisions should be upheld. Plaintiffs claim that

VA improperly used its sharing authority to enter ESAs that were not for sharing

of health-care resource, is entirely without support in the administrative record.

The challenged ESAs must be upheld because they are based on VAs

consideration of the relevant factors and there is no clear error of judgment.



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CONCLUSION

Defendants Motion for Summary Judgment should be granted.

Dated: April 10, 2013

Respectfully submitted,


LEON W. WEIDMANChief, Civil DivisionALARICE M. MEDRANOAssistant United States AttorneyJUDRY L. SUBARAssistant Branch Director

By: /s/ Elisabeth LaytonELISABETH LAYTONSenior CounselKAREN S. BLOOMTrial AttorneyU.S. Department of JusticeCivil DivisionFederal Programs Branch20 Massachusetts Ave., N.W.Washington, DC 20001T: (202) 514-3183;F: (202) 616-8470Email: [email protected]

ttorneys for Defendants


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