
USCA1 Opinion

	




                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No.  94-1611                              LEONARD R. FRIEDMAN, M.D.,                                Plaintiff, Appellant,                                          v.          DONNA E. SHALALA, SECRETARY OF HEALTH AND HUMAN SERVICES, ET. AL.,                                Defendants, Appellees.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                   [Hon. Edward F. Harrington, U.S. District Judge]                                               ___________________                                 ____________________                                        Before                                  Cyr, Circuit Judge,                                       _____________                          Bownes, Senior Circuit Judge, and                                  ____________________                                Stahl, Circuit Judge.                                       _____________                                 ____________________            Leonard R. Friedman, M.D., on brief pro se.            _________________________            Donald K.  Stern, United States  Attorney, and Suzanne E. Durrell,            ________________                               __________________        Assistant United States Attorney, on brief for appellee.                                 ____________________                                   January 27, 1995                                 ____________________                                Per  Curiam.   Leonard  Friedman  is  appealing the                      ___________            district  court's decision dismissing  his case for mootness.            We affirm.                      I.  Background                          __________                      We  recite only  briefly the  pertinent facts.   In            1991,  Friedman sued  various defendants,  claiming that  the            revocation of  his medical  license in Massachusetts  in 1987            and  his exclusion from  Medicare provider rolls  in 1990 had            been   unlawfully  effected.     The  district  court  stayed            proceedings pending  the results  of other state  and federal            court actions involving  the same parties.  In  October 1993,            the  court  approved  the  parties'  stipulation  of  partial            dismissal.  Pursuant to  that stipulation, Friedman dismissed            with prejudice  his claims against all  defendants except his            claim  against the  Department of  Health and  Human Services            (HHS)  for a  declaratory  judgment that  HHS had  wrongfully            excluded him from Medicare provider rolls in 1990.1                                              ____________________            1.  HHS excluded Friedman under 42 U.S.C.   1320a-7(b)(4)(A),            which permits  exclusion of  an individual "whose  license to            provide  health care  has been  revoked  or suspended  by any            State  licensing authority . .  . for reasons  bearing on the            individual's  .  .  . professional  competence,  professional            performance,  or   financial  integrity."    HHS   based  its            exclusion  on  New York's  revocation  of Friedman's  medical            license.  New York had based its revocation on Massachusetts'            determination that Friedman had engaged in "gross misconduct"            sufficient   to  warrant  revocation  of  Friedman's  medical            license in that state.  Friedman's period of exclusion was to            end  when either  Massachusetts  or New  York reinstated  his            license.                                         -2-                      At Friedman's request, HHS reinstated Friedman as a            Medicare  provider in November 1993.  When HHS later answered            Friedman's   complaint,   it    asserted   that    Friedman's            reinstatement had mooted  his claim for  relief and that  the            action should be  dismissed.  The court  agreed and dismissed            the action sua sponte.2                       ___ ______                      II.  Discussion                           __________                      We address two of Friedman's  arguments on appeal.3            First, Friedman says that HHS is reasonably likely to exclude            him  again since  California revoked  his medical  license in            1990  and that any future exclusion by HHS would likely evade            judicial review because it would lapse before the court could            render  a  decision.     Second,  Friedman  argues  that  his            exclusion  has continuing  collateral consequences  that will                                            ____________________            2.  Friedman  did not immediately appeal the order dismissing            his case, but filed  a motion for relief from  judgment under            Fed.  R.  Civ. P.  60(b), the  denial  of which  he appealed.            Because his motion was filed within the time limit for filing            motions under Fed. R. Civ. P. 59(e),  however, and challenged            the legal correctness of the court's decision that his action            was moot,  we  treat it  as a  timely Rule  59(e) motion  and            assume, without  deciding, that  the dismissal of  his action            for  mootness  is properly  before  us.   See  Perez-Perez v.                                                      ___  ___________            Popular Leasing Rental, Inc., 993 F.2d 281, 284-85  (1st Cir.            ____________________________            1993); Mariani-Giron v. Acevedo-Ruiz, 945 F.2d 1, 3 (1st Cir.                   _____________    ____________            1991).            3.  Other arguments  he makes  are without merit,  e.g., that            the stipulation of partial  dismissal and the court's failure            to revoke  its stay  order prior to  Friedman's reinstatement            waived  mootness,  that  evidence discovered  in  1991 before            Friedman filed his suit  qualified as new evidence justifying            relief  from  the court's  judgment,  and  that the  mootness            doctrine  does  not  apply   to  judicial  review  of  agency            decisions.                                         -3-            affect his reputation and his medical and legal careers.  For            those   reasons,  Friedman  claims   that  his   request  for            declaratory relief is not moot.                       A.  Capable of Repetition Yet Evading Review                          ________________________________________                      We  conclude  that  the capable  of  repetition yet            evading review exception to mootness does not apply.  While a            one-year exclusion  may well  evade judicial review,  it does            not seem at all  likely that HHS will exclude Friedman on the            basis of California's revocation of his medical license.                      At the time Friedman applied for reinstatement, the            California  revocation clearly  would have  been a  basis for            excluding Friedman from the Medicare  program.  See 42 U.S.C.                                                            ___               1320a-7(b)(4)(A),  supra  note  1.    Yet  HHS  reinstated                                  _____            Friedman in 1993,  and so it must not have  believed that the            1990  California  license  revocation  would be  grounds  for            excluding  Friedman.   See 42  C.F.R.    1001.3002(a)(3) (HHS                                   ___            "will"  reinstate  an  excluded  individual  if,  among other            things,  it determines  that there  is "no  additional basis"            under the statute for continuing the  exclusion).4  Thus, the            fact that  Friedman was  reinstated shows that  HHS would  be                                            ____________________            4.  Friedman alleges that this regulation and others cited by            HHS  in  its brief  were not  in effect  at  the time  he was            excluded,  but  does  not  allege  that  this  and  the other            regulations embody practices  or policies that are  different            from  ones prevailing  at  the time  of  his exclusion.    In            addition,  we  note  that  the regulations  relating  to  the            reinstatement  of excluded  individuals  became effective  on            January  29, 1992,  and so  presumably applied  to Friedman's            reinstatement in November 1993.                                         -4-            unlikely to use the California revocation to exclude Friedman            in the future.   Moreover, excluding Friedman because  of the            California  revocation   would  arguably  be   an  abuse   of            discretion.  California revoked Friedman's license because of            Massachusetts' revocation of his license; that is, California            based its  license revocation on  the same misconduct  as had            New  York.   Because HHS  based Friedman's  exclusion  on New            York's  revocation  of  Friedman's  license,   excluding  him            because  of  the   California  revocation  would  essentially            penalize Friedman twice for the same  misconduct, a course of            action that we doubt HHS would undertake.                        B. Collateral Consequences                         _______________________                      The  adverse  collateral   consequences  to   which            Friedman  points do  not suffice  to avoid  mootness in  this            case.  According to Friedman, overturning his exclusion would            relieve him of the  stigma of having been excluded,  ease his            admission to  practice law in Massachusetts,  and relieve him            of the  obligation to  explain the  exclusion  when he  seeks            hospital  staff privileges,  affiliation with  certain health            care entities, or licensure in other states.                        Certainly, in some  situations, adverse  collateral            consequences such  as those advanced here have  been found to            avoid  mootness.   See, e.g.,  Kirkland v.  National Mortgage                               _________   ________     _________________            Network,  Inc., 884  F.2d  1367, 1370  (11th Cir.  1989) (the            ______________            dismissal  of an action did  not moot an attorney's challenge                                         -5-            to a court's  revocation of  his admission pro  hac vice  for                                                       ___  ___ ____            failure   to  abide  by   promises  made   during  settlement            negotiations; the  "brand of disqualification  on grounds  of            dishonesty and  bad faith could well  hang over [plaintiff's]            name  and  career  for  years to  come");  Kleiner  v.  First                                                       _______      _____            National Bank of Atlanta, 751 F.2d 1193, 1200 n.14 (11th Cir.            ________________________            1985)  (the  settlement  of  a  class  action  did  not  moot            attorneys' challenge to  their disqualification by the  court            in part because counsel could be exposed to further sanctions            by  the bar  and  their disqualification  could have  adverse            effects on  their  careers  and  public  image)  (alternative            holding);  Miller v.  Washington  State Bar  Ass'n, 679  F.2d                       ______     ____________________________            1313, 1316, 1318  (9th Cir.  1982) (an attorney  could sue  a            state bar association to expunge  a letter of admonition from            his file since he would be required to explain the admonition            if  he applied  to the  bar in  other states or  for judicial            appointments).                        Here, however,  it is  not the HHS  exclusion which            has tarnished Friedman's reputation, but the apparently valid            New York and Massachusetts  licensing board decisions,5 which                                            ____________________            5.  Friedman  apparently  did  not  challenge  the  New  York            decision in court.   The Massachusetts Supreme Judicial Court            has upheld the Massachusetts decision.  See Friedman v. Board                                                    ___ ________    _____            of  Registration in  Medicine,  561 N.E.2d  859 (Mass.  1990)            _____________________________            (substantial  evidence  supported  the  decision   to  revoke            Friedman's  license for gross  misconduct), cert. denied, 498                                                        ____________            U.S.  1107  (1991);  Friedman  v. Board  of  Registration  in                                 ________     ___________________________            Medicine, 609  N.E.2d 1223 (Mass. 1993)  (petition for relief            ________            from license revocation was denied).                                           -6-            concluded  that  Friedman had  engaged in  gross professional            misconduct   sufficient   to   warrant  license   revocation.            Consistent with the applicable statutory basis for exclusion,            HHS's  letter notifying  Friedman of his  exclusion explained            that his exclusion  was based on "the fact" that New York had            revoked  his license  and  indicated that  the  issue in  any            administrative  hearing would  be "whether  your license  was            revoked for reasons relating to your professional competence,            professional  performance, or  financial  integrity."   Since            Friedman's Medicare  exclusion was  based solely on  the fact            that his license had  been revoked, the exclusion effectively            signified only  that New York had  revoked Friedman's license            for  reasons  bearing  on   his  professional  competence  or            performance.  Compare 42 C.F.R.   1001.2007(a)(i) & (ii) (the                          _______            only issues before an ALJ in an exclusion hearing are whether            the  basis  for the  imposition  of the  sanction  exists and            whether  the   length  of  the   exclusion  is  reasonable).6                                            ____________________            6.  This regulation became effective January  29, 1992, after            Friedman was  excluded.  Nonetheless,  it was published  as a            proposed   regulation   before   Friedman's   exclusion   and            represents  HHS's  interpretation   of  its  obligations   in            exclusions such  as Friedman's  as of  the time  Friedman was            excluded.  See 55 Fed. Reg. 12,206  (4/2/90) (explaining that                       ___            HHS's  authority  to exclude  certain  individuals, including            those  whose state  medical  licenses have  been revoked,  is            "derivative" because "our ability to exclude derives from the            fact  that  another  entity has  imposed  a  sanction on  the            individual  or  health  care  entity.    [HHS]  would not  be            required to reestablish  the factual or legal basis  for such            underlying sanction.").                                           -7-            Although the exclusion resulted from  the license revocation,            it conferred no additional stigma on Friedman.7                        Moreover, the  actual effect of  the exclusion  was            exclusively a financial one, as the letter notifying Friedman            of  his exclusion  made  clear.   Because  of his  exclusion,            neither Medicare nor  certain federally-assisted state health            care programs  (from which Friedman was  also excluded) would            pay for services or  items furnished to Friedman's patients.8                                            ____________________            7.  HHS's letter  to Friedman notifying him  of his exclusion            informed him that HHS would notify certain state agencies and            the  public of his exclusion and  of the reasons therefor.  A            copy  of the  public  notice of  Friedman's exclusion  is not            included in the  record, but it apparently would  have stated            that  Friedman's exclusion  would  end when  his license  was            reinstated.  See 42 U.S.C.    1320a-7(c)(3)(A) (the notice of                         ___            exclusion given to the excluded individual and  to the public            shall  specify the minimum period of exclusion).  At the time            Friedman was  reinstated, HHS  was required to  notify "those            agencies,  groups,   individuals,   and  others   that   were            originally   notified   of  the   exclusion"   of  Friedman's            reinstatement.  See 42 C.F.R.   1001.3003(a)(4).  Presumably,                            ___            therefore,  public  notice  of  Friedman's  reinstatement was            given, although it is not clear whether the notice would have            given  the  reason for  his  reinstatement.   Compare  id.                                                             _______  ___            1001.134(a)(2)  (a predecessor regulation  to   1001.3003(a),            which  provided for  notice  to  the  public of  an  excluded            individual's  reinstatement).    Assuming that  the  original            public   notice  of  Friedman's   exclusion  had  stigmatized            Friedman as a  person who  had lost his  medical license  for            reasons   bearing   on   his  professional   performance   or            competence,  that stigma likely would have been erased to the            extent possible by the  reinstatement notice implying, if not            stating outright, that he had regained his license.              8.  The letter stated:                 The effect  of your exclusion from  participation in the                 Medicare  and  State health  care  programs  is that  no                 payment will  be made for  any items or  services (other                 than an emergency item or service) furnished, ordered or                 prescribed by you under the above-mentioned programs.                                         -8-            Regulations  in effect  at the  time Friedman  was reinstated            indicate  that such payments  would have resumed  once he was            reinstated.   See  42 C.F.R.    1001.1901(b)  (payments under                          ___            Medicare and applicable state health care programs may not be            made unless  and until  an excluded individual  is reinstated            into the Medicare program);  id.   1001.3003(b) (with certain                                         ___            exceptions apparently not applicable  here, state health care            programs must  reinstate an individual to  such programs upon            notification by  HHS that the individual  has been reinstated            to  the Medicare program).   There is nothing  in the present            record to suggest that reinstatement did not have this result            in Friedman's case.                      Thus,   if   Friedman  should   seek   some  future            affiliation with a hospital or  other health care entity, the            decision to  grant  or  deny  him affiliation  would  not  be            affected  by the  entity's inability  to receive  Medicare or            applicable  state   program  payments  for   care  given   to            Friedman's patients.  On the other hand, if hospitals, health            care entities, state medical  licensing boards, or any boards            of bar examiners are  concerned about Friedman's character or            professional competence or performance, their response to any            future application of his would be affected predominantly, if                                            ____________________                 Furthermore, payment will  not be made to  any entity in                 which you  are  serving as  an employee,  administrator,                 operator, or in any other capacity for any services that                 you  furnish,  order  or   prescribe  on  or  after  the                 effective date of this exclusion.                                         -9-            not  exclusively,  by the  apparently  valid  state decisions            revoking his medical license.  While   Friedman    may   have            expected  the  district  court  to  review  the Massachusetts            license revocation  proceedings in this suit,  its review was            of necessity  limited to the exclusion  decision itself which            did not encompass the state proceedings.  As noted above, the            parties stipulated to dismissal  of Friedman's claims against            all  defendants with the  exception of his  claim against HHS            relating   to  his  Medicare   exclusion.    Presumably,  the            jurisdictional  basis  for that  claim would  be 42  U.S.C.              1320a-7(f)(1),  which provides  for judicial review  of final            HHS  exclusion  decisions.   Under  HHS  Departmental Appeals            Board  precedent   in  effect  at  the   time  of  Friedman's            exclusion, excluded  individuals  could not  challenge  their            exclusion  by  collaterally  attacking the  underlying  state            license revocation proceedings.  Citing that  precedent, both            the  administrative law  judge  and the  Departmental Appeals            Board  rejected Friedman's attempt to collaterally attack the            Massachusetts  and New  York license  revocation proceedings.            Thus, the  validity of  the underlying state  proceedings was            never  an issue  in  Friedman's exclusion  proceedings.   The            scope of the  proceedings below having  been confined to  the            determination  whether  the  statute  applied  to  Friedman,9                                            ____________________            9.  Friedman had  alleged that the statute  was being applied            retroactively  to him  since  Massachusetts had  rendered its            licensing decision before the statute became effective.                                         -10-            whether  Friedman's  license  had  been revoked  by  a  state            licensing  authority for the  statutorily prescribed reasons,            and  whether  the period  of  exclusion  was reasonable,  the            district  court's review  of the decision  excluding Friedman            would be likewise constrained.   Cf. Travers v. Sullivan, 801                                             ___ _______    ________            F.  Supp. 395, 403 (E.D.  Wash. 1992) (where  HHS excluded an            individual on the  basis of  a prior state  conviction for  a            program-related offense, it was  "not necessary or proper for            the   court  to   delve  into   the  facts   surrounding  the            conviction"; the court's role  under   1320a-7(f) was  not to            review  the  validity of  the  underlying  conviction but  to            review the  validity of the  exclusion), aff'd, 20  F.3d 993,                                                     _____            998 (1994).10                      Under  these circumstances,  we conclude  that this            action is  moot.  See  Florida Farmworkers  Council, Inc.  v.                              ___  __________________________________            Marshall,  710  F.2d 721,  731  (11th Cir.  1983)  (the court            ________            determined  that  expiration  of  plaintiff's  debarment  had                                            ____________________            10.  HHS's  policy barring collateral attack on state license            revocation proceedings and limiting  the nature of the issues            addressed  in   exclusion  proceedings  is  now  codified  in            regulations that have been  expressly made binding on federal            courts.  See 42 C.F.R.   1001.2007(d) (prohibiting collateral                     ___            attacks on  the underlying state determinations  which form a            basis for exclusion); id.   1001.2007(a)(i) &  (ii) (the only                                  ___            issues  before an  administrative law  judge in  an exclusion            hearing  are whether  the basis  for excluding  an individual            exists   and  whether   the  length   of  the   exclusion  is            reasonable);   id.      1001.1(b)   (these   regulations  are                           ___            applicable  to and  binding  on federal  courts in  reviewing            exclusions  imposed by  HHS)  (this latter  regulation became            effective January 22, 1993).                                             -11-            mooted   its   action  challenging   the   debarment  despite            plaintiff's  claim of stigma because the court had upheld the            costs  disallowances  that  had  caused  the  debarment;   it            explained  that it  could not  discern any  additional stigma            created  by the  debarment  and that  the  debarment had  not            prevented plaintiff from receiving substantial federal funds,            apparently after the debarment had ended).                      Affirmed.                          _________                                         -12-
