     Case: 18-40866      Document: 00515063992         Page: 1    Date Filed: 08/05/2019




           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT
                                                                            United States Court of Appeals
                                                                                     Fifth Circuit

                                                                                   FILED
                                      No. 18-40866                            August 5, 2019
                                                        Lyle W. Cayce
TROY W. SIMMONS, D.D.S.; TROY W. SIMMONS, D.D.S., P.C.,      Clerk


              Plaintiffs - Appellants

v.

CHARLES SMITH, Executive Commissioner of the Texas Health and Human
Services Commission, in His Official Capacity,

              Defendant - Appellee




                   Appeal from the United States District Court
                        for the Eastern District of Texas
                             USDC No. 6:17-CV-557


Before CLEMENT, HAYNES, and WILLETT, Circuit Judges.
PER CURIAM:*
       Appellants Troy W. Simmons, D.D.S., P.C. and Troy W. Simmons, D.D.S.
(collectively, “Simmons”) appeal the district court’s grant of Appellee Charles
Smith’s motion to dismiss for lack of subject matter jurisdiction. We AFFIRM
the district court’s judgment.




       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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                                      No. 18-40866
                                 I.    Background
      Simmons seeks the return of funds that the Texas Health and Human
Services Commission (“HHSC”) 1 Office of Inspector General (“OIG”) withheld
after it determined Simmons had received overpayments as a Medicaid
services provider.
      In October 2012, the OIG determined Simmons had committed Medicaid
program violations and found a credible allegation of fraud. Several months
later, the OIG sent Simmons a Notice of Potential Overpayment of over two
million dollars. It also placed a hold on future payments reimbursing Simmons
for Medicaid services rendered. Simmons contested the payment hold before
the State Office of Administrative Hearings.
      The OIG then sent Simmons a Final Notice of Overpayment.                      It
thereafter moved to dismiss Simmons’s payment hold action as moot, arguing
that Simmons had not timely appealed the Final Notice of Overpayment. The
Administrative Law Judge (“ALJ”) presiding over the dispute denied the
motion.
      The OIG later applied the money subject to the payment hold toward
Simmons’s purported debt. It then lifted the payment hold. The ALJ cancelled
a scheduled hearing on the payment hold based on the parties’ agreement that
there was no need for a hearing on the merits. The ALJ thus remanded the
matter back to the HHSC.
      Simmons then filed suit in district court, seeking “a permanent
injunction that all funds that have been retained by [Smith] as a consequence
of the payment hold be released and immediately forwarded to” Simmons.
Smith moved to dismiss Simmons’s claim under Federal Rules of Civil
Procedure 12(b)(1) and 12(b)(6). The district court granted Smith’s motion


      1   Smith is the Executive Commissioner of the HHSC.
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                                    No. 18-40866
with prejudice, concluding that it lacked subject matter jurisdiction because
Smith was entitled to sovereign immunity under Eleventh Amendment
principles. This appeal followed.

                           II.      Legal Standard
      When a party moves to dismiss for lack of subject matter jurisdiction
under Federal Rule of Civil Procedure 12(b)(1), the party asserting jurisdiction
bears the burden of proof. Ramming v. United States, 281 F.3d 158, 161 (5th
Cir. 2001) (per curiam). We review the legal issues underpinning a district
court’s grant of a Rule 12(b)(1) motion to dismiss de novo. Zephyr Aviation,
L.L.C. v. Dailey, 247 F.3d 565, 570 (5th Cir. 2001).
      “The Eleventh Amendment bars private citizens from bringing suit
against a state in federal court, unless the suit falls within” a narrow exception
to the Eleventh Amendment. McKinley v. Abbott, 643 F.3d 403, 405 (5th Cir.
2011). “Eleventh Amendment immunity extends to state officials who are sued
in their official capacities because such a suit is actually one against the state
itself.” Id. at 406 (holding that the Eleventh Amendment barred a suit against
the Texas Attorney General in his official capacity).

                             III.     Discussion
      Smith is entitled to sovereign immunity from Simmons’s claims, thus
divesting the federal courts of jurisdiction. See Sissom v. Univ. of Tex. High
Sch., 927 F.3d 343, 347 (5th Cir. 2019) (noting that the Eleventh Amendment
“textually divests federal courts of jurisdiction over states”).    Simmons sued
Smith in his official capacity as Executive Commissioner of the HHSC, which
is a state agency. See Cephus v. Tex. Health & Human Servs. Comm’n, 146 F.
Supp. 3d 818, 827 (S.D. Tex. 2015) (“HHSC, as a state agency, is entitled to the
protections of sovereign immunity.”); see also TEX. GOV’T CODE ANN. §
531.021(a) (“The [HHSC] is the state agency designated to administer federal
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                                   No. 18-40866
Medicaid funds.” (emphasis added)). Smith is thus immune from Simmons’s
claims unless Simmons can show that an exception to immunity applies.
      Simmons argues that Ex parte Young creates an exception to sovereign
immunity here because he seeks prospective injunctive relief for an ongoing
violation of federal law. See Ex parte Young, 209 U.S. 123 (1908). But the
challenged actions ended in 2014, when the OIG applied the withheld funds to
Simmons’s balance and lifted the payment hold. Though Simmons frames his
requested relief as injunctive and prospective, he essentially seeks money
damages from the HHSC for its past actions. “Relief that in essence serves to
compensate a party injured in the past by an action of a state official in his
official capacity . . . is barred . . . if the relief is tantamount to an award of
damages for a past violation of federal law, even though styled as something
else.” Papasan v. Allain, 478 U.S. 265, 278 (1986); see also Va. Office for Prot.
& Advocacy v. Stewart, 563 U.S. 247, 256–57 (2011) (“Ex parte Young cannot
be used to obtain an injunction requiring the payment of funds from the State’s
treasury . . .”). Ex parte Young does not apply.
      Simmons also claims that the ultra vires exception to sovereign
immunity applies. But “a state officer may be said to act ultra vires only when
he acts ‘without any authority whatever.’” Pennhurst State Sch. & Hosp. v.
Halderman, 465 U.S. 89, 101 n.11 (1984) (quoting Fla. Dep’t of State v.
Treasure Salvors, Inc., 458 U.S. 670, 697 (1982)). The OIG has statutory
authority to “recoup from any person if it determines that the person . . . causes
or receives an overpayment.” 1 TEX. ADMIN. CODE § 371.1711(b)(5). It may
impose a payment hold if “a credible allegation of fraud exists.”                Id.
§ 371.1709(a)(3). If the OIG issues a sanction, that “sanction becomes final
upon . . . expiration of 30 calendar days after service of the notice of final
sanction if no request for appeal of imposition of the sanction is received” by
that time. Id. § 371.1617(a)(1).
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      Simmons does not plausibly argue that he timely appealed the Final
Notice of Overpayment. The OIG thus had statutory authority to apply the
withheld funds to Simmons’s balance and lift the payment hold. Because the
OIG had authority to undertake the challenged actions, Smith did not act ultra
vires, even if Simmons disagrees with his actions. See Larson v. Domestic &
Foreign Commerce Corp., 337 U.S. 682, 695 (1949) (“[W]e have . . . rejected the
argument that official action is invalid if based on an incorrect decision as to
law or fact, if the officer making the decision was empowered to do so.”). Smith
is entitled to sovereign immunity; thus, the district court properly concluded
the federal courts lack jurisdiction.
      AFFIRMED.




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