IN THE INTERMEDIATE COURT OF APPEALS OF WEST VIRGINIA

Spring 2024 Term

_____________________

Nos. 23-ICA-127 & 23-ICA-135

_____________________

BRIAN CUNNINGHAM, in his capacity as Director of the Public Employees Insurance 

Agency and MARK D. SCOTT, GEOFF S. CHRISTIAN, AMANDA D. MEADOWS, 

JARED ROBERTSON, DAMITA JOHNSON, JASON MYERS, MICHAEL COOK, 

WILLIAM MILAM, and MICHAEL T. SMITH, in their capacities as Members of the 

Public Employees Insurance Agency Finance Board,

Respondents Below, Petitioners

v.) No. 23-ICA-127

AIR EVAC EMS, INC., 

Petitioner Below, Respondent

_____________________

AND

_____________________

AIR EVAC EMS, INC., 

Petitioner Below, Petitioner

v.) No. 23-ICA-135

BRIAN CUNNINGHAM, in his capacity as Director of the Public Employees Insurance 

Agency and MARK D. SCOTT, GEOFF S. CHRISTIAN, AMANDA D. MEADOWS, 

JARED ROBERTSON, DAMITA JOHNSON, JASON MYERS, MICHAEL COOK, 

WILLIAM MILAM, and MICHAEL T. SMITH, in their capacities as Members of the 

Public Employees Insurance Agency Finance Board,

Respondents Below, Respondents

FILED

June 13, 2024

released at 3:00 p.m.

ASHLEY N. DEEM, DEPUTY CLERK

INTERMEDIATE COURT OF APPEALS

OF WEST VIRGINIA
___________________________________________________________

Appeal from the Circuit Court of Kanawha County

Honorable Carrie L. Webster, Judge

Civil Action No. 19-AA-169

REVERSED AND REMANDED

_________________________________________________________

Submitted: February 6, 2024

Filed: June 13, 2024

Michael R. Williams, Esq.

Deputy Solicitor General

Sean M. Whelan, Esq.

Deputy Attorney General

Charleston, West Virginia

Counsel for Petitioners

Carte P. Goodwin, Esq.

Alex J. Zurbuch, Esq.

Mary Claire Davis, Esq.

FROST BROWN TODD LLP

Charleston, West Virginia

Counsel for Respondent

JUDGE LORENSEN delivered the Opinion of the Court.

CHIEF JUDGE SCARR dissents and reserves the right to file a separate opinion.

JUDGE GREEAR voluntarily recused.

JUDGE ROBERT E. RYAN sitting by temporary assignment.
1

LORENSEN, JUDGE:

This consolidated matter arises from Air Evac EMS, Inc.’s (“Air Evac”) 

attemptsto collect additional payment for providing air ambulance transports to individuals 

insured by the West Virginia Public Employees Insurance Agency (“PEIA”)1 over three 

years.2 Both parties appeal the December 16, 2022, order of the Circuit Court of Kanawha 

County, which held that: (1) PEIA is not entitled to sovereign immunity against Air Evac’s 

claims; (2) the payment dispute between Air Evac and PEIA was subject to the

Administrative Procedures Act (“APA”) and Contested Case Rules (“CCR”); (3) pursuant 

to the CCR, Air Evac is entitled to a contested hearing on the merits of its demand for 

additional payments from PEIA; and (4) on remand, PEIA and Air Evac were ordered to 

negotiate a fair price before pursuing further administrative proceedings, concluding it was

improper to set reimbursement at either the Medicare Rural Rate or Air Evac’s “full billed”

charges. 

On review, we hold that the circuit court erred in concluding that sovereign 

immunity did not bar Air Evac’s claim for damages against PEIA. Therefore, we reverse 

the circuit court’s December 16, 2022, Final Order Granting, in Part and Denying, in Part 

1 Since the filing of this consolidated appeal, Brian Cunningham was appointed as 

Director of the Public Employees Insurance Agency. Accordingly, by order dated February 

1, 2024, this Court made the necessary substitution of parties pursuant to Rule 41(c) of the 

West Virginia Rules of Appellate Procedure. 

2 The transports at issue occurred between June 9, 2016, and June 4, 2019.
2

Air Evac EMS, Inc.’s Petition for Appeal and remand this matter to be dismissed with 

prejudice.

I. FACTUAL AND PROCEDURAL BACKGROUND

This action follows extensive federal litigation that resulted in PEIA’s air 

ambulance reimbursement rate caps being found to be preempted by federal law.3 As

relevant context, we provide a brief overview of the federal litigation. On June 9, 2016, Air 

Evac initiated an action in the United States District Court for the Southern District of West 

Virginia, seeking a declaratory judgment that PEIA’s reimbursement rate caps

4 were

preempted by the federal Airline Deregulation Act (“ADA”). See Cheatham II, 2017 WL 

4765966, at *1, 10. The rate cap provisions limited PEIA’s reimbursement rates for air 

ambulance providers to either the Medicare Rural Rate or the annual cost of an air 

ambulance provider’s membership program—both being rates below Air Evac’s “fullbilled” charges. See id. at *1. At summary judgment, the district court found that the ADA 

preempted the provisions, and enjoined PEIA from enforcing the reimbursement caps. Id.

3 See Air Evac EMS, Inc. v. Cheatham (Cheatham I), 260 F. Supp. 3d 628, 633 

(S.D.W. Va. 2017); Air Evac EMS, Inc. v. Cheatham (Cheatham II), No. 2:16-cv-05224, 

2017 WL 4765966, at *1 (S.D.W. Va. Oct. 20, 2017), aff'd, 910 F.3d 751 (4th Cir. 2018); 

Air Evac EMS, Inc. v. Cheatham (Cheatham III), 910 F.3d 751, 759 (4th Cir. 2018); see 

also W. Va. Code §§ 5-16-8a(a)–(b) (2016) (amended 2019), 5-16-5(c)(1) (2007) 

(amended 2023).

4 See W. Va. Code §§ 5-16-8a(a)–(b) (2016) (amended 2019), 5-16-5(c)(1) (2007) 

(amended 2023).
3

During PEIA’s appeal of the district court’s decision, Air Evac sent written 

demands to PEIA, asserting that, in light of the injunction, PEIA was now obligated to pay 

its “full billed” charges for air transports it had provided since initiating the federal 

litigation. PEIA refused, arguing that it was not mandated to “unquestionably pay whatever 

amount Air Evac unilaterally establishes as its charge” and maintaining that it had 

discretion to negotiate. Instead, PEIA offered to pay a portion of Air Evac’s billed charges 

at the Medicare Rural Rate, which Air Evac accepted, considering it partial compensation.

5

Before the United States Court of Appeals for the Fourth Circuit, the district 

court’s decision was affirmed in full, and the Fourth Circuit agreed that PEIA’s rate 

capping provisions were preempted by the ADA. See Cheatham III, 910 F.3d 751, 755.

Once the Fourth Circuit had issued its ruling, a second exchange of demands and refusals 

began. Over the summer of 2019, the parties continued to dispute whether PEIA had an

obligation to further compensate Air Evac. Eventually, the parties reached an impasse, and

on October 24, 2019, Air Evac demanded a contested case hearing before the PEIA Board 

regarding the disputed charges. In response, on November 13, 2019, PEIA declined to 

schedule a hearing, asserting that Air Evac’s demand was exempt from APA procedures, 

and therefore not subject to the CCR.

6

5 PEIA paid $754,988.00 of Air Evac’s $4,773,034.00 “full billed” charges.

6 See W. Va. Code R. §§ 151-1-1 et seq.
4

Construing PEIA’s response as a summary denial, on December 13, 2019, 

Air Evac appealed PEIA’s decision to the Circuit Court of Kanawha County. There, Air 

Evac sought a declaration that it was entitled to a contested hearing under the APA, and 

further, sought the circuit court to order PEIA to pay the remaining balance of $4,018,046 

for the 115 transports it provided to PEIA members between June 9, 2016, and June 4, 

2019. In support, Air Evac claimed that, in light of the federal injunction modifying the 

reimbursement statutes,

7

severability principles now mandated PEIA to pay Air Evac’s 

“full billed” charges. Further, Air Evac contended that PEIA’s refusal to budge from the 

Medicare Rural Rate—the same rate PEIA would have previously paid under the nowenjoined rate caps—amounted to ignoring the federal injunction. 

In response, PEIA, citing its own regulations, maintained that the APA was 

inapplicable because this matter constituted a provider payment dispute, and as such, it was

exempt from APA procedures.

8 Further, addressing severability, PEIA contended that the 

remaining statutory language would not amount to a mandate for PEIA to pay whatever 

price Air Evac demanded. PEIA also raised an issue of its own challenging the circuit 

court’s jurisdiction by invoking sovereign immunity as a defense. 

7 See Cheatham III, 910 F.3d 751, 759; see also W. Va. Code §§ 5-16-8a(a)–(b) 

(2016) (amended 2019), 5-16-5(c)(1) (2007) (amended 2023).

8 See W. Va. Code R. §§ 151-1-1 et seq.
5

On December 16, 2022, the circuit court issued its Final Order Granting, in 

Part and Denying, in Part Air Evac EMS, Inc.’s Petition for Appeal. The circuit court 

concluded that PEIA was not entitled to sovereign immunity, as Air Evac was seeking 

recovery from legislatively appropriated funds. Specifically, the funds sought were, in part,

appropriated to PEIA for the purpose of satisfying payments like the medical transports at 

issue, placing Air Evac’s claim within an exception to PEIA’s sovereign immunity. 

Further, the circuit court determined that this matter was subject to APA procedures and 

PEIA’s Contested Case Rules. Regarding the disputed payments, the circuit court reasoned 

that PEIA’s decision to reimburse Air Evac at the Medicare Rural Rate failed to comply 

with the Fourth Circuit’s mandate in Cheatham III; however, the circuit court also rejected 

Air Evac’s assertions that it was entitled to payment of its “fully billed” charges. Instead, 

the circuit court ordered the parties to engage in good faith negotiations regarding the 

disputed charges, and if no resolution materialized, for further proceedings pursuant to the 

APA and CCR.

9

It is from this order both parties appeal. 

9 The circuit court also rejected PEIA’s contention that, pursuant to its authority 

under West Virginia Code § 5-16-3(c) (2013), it had retroactively lifted the ban on balancebilling for the transports in question, which would permit Air Evac to recover any unpaid 

balance from PEIA members. 
6

II. STANDARD OF REVIEW

When reviewing a question of sovereign immunity, our standard of review10

is as follows: 

[The Supreme Court of Appeals of West Virginia] has held that 

“[w]here the issue on an appeal from the circuit court is clearly 

a question of law or involving an interpretation of a statute, we 

apply a de novo standard of review.” Further, “[a]s 

jurisdictional issues are questions of law, our review is de 

novo.”

Holley v. Feagley, 242 W. Va. 240, 242, 834 S.E.2d 536, 538 (2019) (footnotes omitted) 

(first quoting Syl. Pt. 1, Chrystal R.M. v. Charlie A.L., 194 W. Va. 138, 459 S.E.2d 415 

(1995); and then quoting State ex rel. Universal Underwriters Ins. Co. v. Wilson, 239 W. 

Va. 338, 343, 801 S.E.2d 216, 221 (2017)). 

III. DISCUSSION

At the outset, we address our jurisdiction. Our jurisdiction stems from the 

circuit court’s denial of PEIA’s sovereign immunity defense. We consider the circuit 

court’s order to be an appealable order on the issue of sovereign immunity:

“[A] circuit court's denial of a motion to dismiss that is 

predicated on qualified immunity is an interlocutory ruling 

which is subject to immediate appeal under the ‘collateral 

order’ doctrine.” Likewise, when the issue relates to sovereign 

immunity, it is well-settled that “the denial of a substantial 

10 The parties dispute whether this matter is properly subject to judicial review as a 

contested case pursuant to the Administrative Procedures Act. In such cases, a specific 

statutory standard of review is to be applied. See W. Va. Code § 29A-5-4(g) (2021).

However, because we dispose of this case on sovereign immunity grounds, we decline to 

apply the standards of review applicable to the other assignments of error raised by the 

parties.
7

claim of absolute immunity is an order appealable before final 

judgment[.]”

W. Virginia Lottery v. A-1 Amusement, Inc., 240 W. Va. 89, 94, 807 S.E.2d 760, 765 (2017)

(second alteration in original) (first quoting W. Virginia Bd. of Educ. v. Marple, 236 W. 

Va. 654, 660, 783 S.E.2d 75, 81 (2015); and then quoting Mitchell v. Forsyth, 472 U.S.

511, 525 (1985)).11 With our jurisdiction to review the circuit court’s order established, we 

proceed to consider the principles of our sovereign immunity jurisprudence. 

A. Sovereign Immunity 

The State’s sovereign immunity against suit is enshrined within Article VI, 

§ 35 (“Section 35”) of the West Virginia Constitution, which provides that: “The state of 

West Virginia shall never be made defendant in any court of law or equity . . . .”

Accordingly, if applicable, sovereign immunity deprives a court of jurisdiction to hear the 

11 See W. Va. Code § 51-11-4(b)(1) (granting the Intermediate Court of Appeals 

jurisdiction over “[f]inal judgments or orders of a circuit court in all civil cases . . . entered 

after June 30, 2022 . . .”).
8

case.12 This immunity is “facially absolute[,]”

13 unwaivable,14 and extends to agencies of 

the State.15 The underlying purpose of sovereign immunity is “designed to protect the 

public purse”16 from the “diversion of state money from legislatively appropriated purposes 

to the payment of court awards[.]”

17

12 See W. Va. Const. art. VI, § 35; Arnold Agency v. W. Virginia Lottery Comm'n, 

206 W. Va. 583, 593, 526 S.E.2d 814, 824 (1999); Skaff v. Pridemore, 200 W. Va. 700,

704–05, 490 S.E.2d 787, 791–92 (1997) (per curiam); Parkulo v. W. Virginia Bd. of Prob. 

& Parole, 199 W. Va. 161, 167, 483 S.E.2d 507, 513 (1996). 

13 Davari v. W. Virginia Univ. Bd. of Governors, 245 W. Va. 95, 99, 857 S.E.2d 

435, 439 (2021); see also Gribben v. Kirk, 195 W. Va. 488, 493, 466 S.E.2d 147, 152 

(1995) (citations omitted) (“the constitutional grounding of the State's immunity is not 

judicially revocable”); Mellon-Stuart Co. v. Hall, 178 W. Va. 291, 296, 359 S.E.2d 124, 

129 (1987) (“This constitutional grant of immunity is absolute and, as we have consistently 

held, cannot be waived by the legislature or any other instrumentality of the State.”).

14 See Univ. of W. Virginia Bd. of Trustees ex rel. W. Virginia Univ. v. Graf, 205 W. 

Va. 118, 121, 516 S.E.2d 741, 744 (1998); Skaff v. Pridemore, 200 W. Va. 700, 705–06, 

490 S.E.2d 787, 792–93 (1997) (per curiam) (“[I]t is clear that ‘the constitutional immunity 

of the State of West Virginia from suit by Article VI, Section 35 of the Constitution of this 

State can not be waived by the Legislature or any other instrumentality of the State.’”)

(quoting Morgantown v. Ducker, 153 W. Va. 121, 130, 168 S.E.2d 298, 303 (1969)).

15 See Syl. Pt. 7, Shaffer v. Stanley, 215 W. Va. 58, 593 S.E.2d 629 (2003) (quoting 

Syl. Pt. 2, Stewart v. State Road Comm’n, 117 W. Va. 352, 185 S.E. 567 (1936)); Parkulo 

v. W. Virginia Bd. of Prob. & Parole, 199 W. Va. 161, 168, 483 S.E.2d 507, 514 (1996)).

16 Pittsburgh Elevator Co. v. W. Virginia Bd. of Regents, 172 W. Va. 743, 756, 310 

S.E.2d 675, 689 (1983).

17 Kerns v. Bucklew, 178 W. Va. 68, 72, 357 S.E.2d 750, 754 (1987); see also 

Mellon-Stuart Co. v. Hall, 178 W. Va. 291, 296, 359 S.E.2d 124, 129 (1987).
9

Nevertheless, West Virginia law has recognized exceptions to this 

immunity.18 In applying these exceptions, specific focus is placed on the nature of the relief 

18 In Univ. of W. Virginia Bd. of Trustees ex rel. W. Virginia Univ. v. Graf, 205 W. 

Va. 118, 122–23, 516 S.E.2d 741, 745–46 (1998), the Supreme Court of Appeals of West 

Virginia highlighted many such exceptions:

These exceptions include injunctions to restrain or require 

State officers to perform ministerial duties, C & O R'y Co. v. 

Miller, Auditor, 19 W.Va. 408 (1882), aff'd, 114 U.S. 176, 5 

S.Ct. 813, 29 L.Ed. 121 (1885); suits against State officers 

acting or threatening to act, under allegedly unconstitutional 

statutes, Blue Jacket Consol. Copper. v. Scherr, 50 W.Va. 533, 

40 S.E. 514 (1901); recognition of a moral obligation by the 

State, State ex rel. Davis Trust Co. v. Sims, 130 W.Va. 623, 46 

S.E.2d 90 (1947); counterclaims growing out of transactions 

wherein the State institutes actions at law against a citizen, 

State v. Ruthbell Coal Co., 133 W.Va. 319, 56 S.E.2d 549 

(1949); suits for declaratory judgment, Douglass v. Koontz,

137 W.Va. 345, 71 S.E.2d 319 (1952); mandamus relief to 

require the State Road Commission to institute proper 

condemnation proceedings upon the taking or damaging of 

land for public purposes, Stewart v. State Road Commission of 

West Virginia, 117 W.Va. 352, 185 S.E. 567 (1936); suits 

alleging liability arising from the State's performance of 

proprietary functions, Ward v. County Court of Raleigh 

County, 141 W.Va. 730, 93 S.E.2d 44 (1956); suits against 

quasi-public corporations which have no taxing power or 

dependency upon the State for financial support, Hope Natural 

Gas v. West Virginia Turn. Com'n, 143 W.Va. 913, 105 S.E.2d 

630 (1958); mandamus relief to compel State officers, who 

have acted arbitrarily, capriciously or outside the law, to 

perform their lawful duties, State ex rel. Ritchie v. Triplett, 160 

W.Va. 599, 236 S.E.2d 474 (1977); suits in which 

constitutional immunity is superseded by federal law, Kerns v. 

Bucklew, 178 W.Va. 68, 357 S.E.2d 750 (1987); suits that seek 

recovery under and up to the limits of the State's liability 

insurance coverage, Pittsburgh Elevator v. W.Va. Bd. of 

Regents, 172 W.Va. 743, 310 S.E.2d 675 (1983); and suits by 

state employees seeking an award of back wages which is 
10

sought. Accordingly, “where monetary relief is sought against the State treasury for which 

a proper legislative appropriation has not been made, sovereign immunity raises a bar to 

suit.” Davari v. W. Virginia Univ. Bd. of Governors, 245 W. Va. 95, 102, 857 S.E.2d 435, 

442 (2021) (citing Mellon-Stuart Co. v. Hall, 178 W. Va. 291, 296, 359 S.E.2d 124, 129 

(1987)). Further, a distinction is drawn between requests for prospective and retroactive 

relief. “‘[T]he sovereign immunity doctrine is implicated when retroactive money relief 

against the State is sought, but does not operate to bar an award which is prospective in 

nature.’” Univ. of W. Virginia Bd. of Trustees ex rel. W. Virginia Univ. v. Graf, 205 W. 

Va. 118, 121, 516 S.E.2d 741, 744 (1998) (quoting Skaff v. Pridemore, 200 W. Va. 700, 

706, 490 S.E.2d 787, 793 (1997) (per curiam)). 

Mindful of these principles, we consider the parties’ arguments regarding the 

application of sovereign immunity to this matter. 

B. Application of Law

In No. 23-ICA-127, PEIA argues that the circuit court erred in declining to 

recognize its sovereign immunity. PEIA contends that the circuit court’s reliance on

Mellon-Stuart Co. v. Hall19 creates a new, unrecognized, general “legislative 

appropriation” exception to sovereign immunity. Further, the circuit court violated a 

prospective in nature, Gribben v. Kirk, 195 W.Va. 488, 466 

S.E.2d 147 (1995).

19 178 W. Va. 291, 296, 359 S.E.2d 124, 129 (1987).
11

second sovereign immunity principle by not recognizing that Air Evac impermissibly seeks

retroactive monetary relief—payment for its past transports—from the State in an 

administrative action and associated lawsuit filed in circuit court in late 2019. Conversely, 

Air Evac maintains that sovereign immunity is inapplicable for three reasons: (1) PEIA is 

not named as a “defendant” in this action within the meaning of Section 35 to trigger 

immunity; (2) pursuant to the circuit court’s reading of Mellon-Stuart, Air Evac only seeks

recovery from funds that have been legislatively appropriated for the purpose of 

compensating health care providers for their services; and (3) even if sovereign immunity 

is otherwise applicable, Air Evac’s demand falls within the prospective relief exception to 

immunity because it only requests payment for transports made after the filing of the 

federal Cheatham litigation.

20

20 Simultaneously, in No. 23-ICA-135, Air Evac asserts a cross-assignment of error, 

arguing that, instead of ordering the parties to negotiate a mutually agreed reimbursement 

rate and undergo further administrative proceedings, the circuit court should have 

determined that it was entitled to reimbursement of its “full billed” charges.

While we recognize the other assignments of error raised in this consolidated appeal, 

because sovereign immunity presents a jurisdictional bar to the underlying claim, we 

decline to consider further issues. See W. Va. Const. art. VI, § 35; Arnold Agency v. W. 

Virginia Lottery Comm'n, 206 W. Va. 583, 593, 526 S.E.2d 814, 824 (1999); Skaff v. 

Pridemore, 200 W. Va. 700, 704–05, 490 S.E.2d 787, 791–92 (1997) (per curiam); Parkulo 

v. W. Virginia Bd. of Prob. & Parole, 199 W. Va. 161, 167, 483 S.E.2d 507, 513 (1996).

“As the circuit court's lack of jurisdiction over this matter is dispositive, we need not 

address . . . [the] remaining assignments of error.” Holley v. Feagley, 242 W. Va. 240, 245, 

834 S.E.2d 536, 541 (2019).
12

We must first consider if this matter triggers Section 35 immunity.21 Air Evac 

does not dispute that PEIA, as a state agency, constitutes “the State” for the purposes of 

sovereign immunity; instead, it argues that PEIA is not a “defendant” within the meaning 

of Section 35.22 We find this argument unpersuasive.

We begin by acknowledging that certain suits do not trigger the sovereign 

immunity of the State:

[C]ourts will entertain actions against State officials through 

the common law writs of mandamus, prohibition, and habeas 

corpus or through the courts' equitable powers to issue 

injunctions. In such cases, the “State” is not a defendant; rather, 

a State official is sued (usually in his or her official capacity) 

to require performance of a nondiscretionary duty of 

constitutional or statutory origin or to cease engaging in a 

course of conduct that violates some constitutional or statutory 

duty.

Gribben v. Kirk, 195 W. Va. 488, 493, 466 S.E.2d 147, 152 (1995). Ultimately, the core 

consideration is whether the true party in interest is the State:

The Supreme Court of the United States has discussed that 

“when the action is in essence one for recovery of money from 

21 See W. Va. Const. art. VI, § 35 (“The state of West Virginia shall never be made 

defendant in any court of law or equity . . . .”).

22 It appears that this argument was not raised before the circuit court. Normally, we 

would decline to consider a new argument raised for the first time on appeal; however, as

this argument pertains to an unwaivable jurisdictional issue, we will consider it. See Argus 

Energy, LLC v. Marenko, 248 W. Va. 98, 104, 887 S.E.2d 223, 229 (2023) (“In cases 

dealing with . . . jurisdiction, the rule against raising a new issue or argument [on appeal]—

premised as it is on principles of waiver—does not apply . . .”); Lewis v. Municipality of 

Masontown, 241 W. Va. 166, 170, 820 S.E.2d 612, 616 (2018).
13

the state, the state is the real, substantial party in interest and is 

entitled to invoke its sovereign immunity from suit even 

though individual officials are nominal defendants.” In that 

same vein, the Supreme Court of the United States has 

determined that when a claim seeks recovery of funds from the 

state treasury as retroactive relief, the state retains sovereign 

immunity unless some other exception applies.

W. Virginia Lottery v. A-1 Amusement, Inc., 240 W. Va. 89, 103–04, 807 S.E.2d 760, 774–

75 (2017) (footnotes omitted) (citations omitted). Here, we observe that the named

defending parties are PEIA’s director and members of its Finance Board, sued in their 

official capacities. It follows then, that “when the action is in essence one for recovery of 

money from the state, the state is the real, substantial party in interest and is entitled to 

invoke its sovereign immunity from suit.” Id. at 103, 807 S.E.2d at 774 (2017). 

Air Evac seeks to distinguish this matter from a typical claim for money 

damages. It highlights that, under its severability theory, PEIA’s obligation to pay its “full 

billed” charges arises from the simple operation of PEIA’s reimbursement statutes, less the 

language preempted by federal law.23 We also recognize that Air Evac did not seek money 

damages alone—it also sought recognition that the APA and CCR controlled its dispute 

with PEIA. However, at bottom, Air Evac cannot escape nor deny what it seeks—a 

directive requiring the State to pay Air Evac the money it contends it is owed. Air Evac 

concedes this point in its prayer for relief before the circuit court: 

Accordingly, Air Evac respectfully requests that this Court 

expeditiously affirm the validity the contested case hearing 

23 See Cheatham III, 910 F.3d 751, 759; see also W. Va. Code §§ 5-16-8a(a)–(b) 

(2016) (amended 2019), 5-16-5(c)(1) (2007) (amended 2023).
14

procedures of W. Va. Code R. § 151-1-3, et seq., and . . . grant 

a final order: (1) ordering that, under West Virginia law, Air 

Evac is entitled to payment of its billed charges on the disputed 

transports; and (2) ordering that, under West Virginia law, 

Respondents must promptly issue full payment on these 

transports.24

Air Evac concedes the same in its briefing before this Court:

For the foregoing reasons, this Court should reverse the Circuit 

Court’s decision that Air Evac is not entitled to full payment 

for air ambulance transports from June 9, 2016, to June 4, 

2019, and remand with instructions to order PEIA to fully 

reimburse Air Evac for these charges.25

As the Supreme Court of Appeals of West Virginia has explained: “Our cases reflect a 

desire to ensure the proper performance of official duties, and so long as compliance with 

a judicial decree does not require the expenditure of money, no potential for conflict with 

Section 35 is triggered.” W. Virginia Lottery v. A-1 Amusement, Inc., 240 W. Va. 89, 102, 

807 S.E.2d 760, 773 (2017) (emphasis added) (quoting Gribben v. Kirk, 195 W. Va. 488, 

494, 466 S.E.2d 147, 153 (1995)). Accordingly, we conclude that Air Evac’s claim seeks 

money recovery from a State defendant. As result, Section 35 immunity is triggered.26

24 No. 23-ICA-127, A.R. 20 (Petition for Appeal). 

25 No. 23-ICA-135, Pet’r’s. Br. 23.

26 As to any distinction between PEIA’s posture as a “defendant” or “respondent” 

in this matter, we find it immaterial.

We note, in passing, that as a component of this argument, Air Evac asserts that

judicial review of administrative matters does not implicate sovereign immunity at all. 

According to Air Evac, three cases stand for that proposition. See Curry v. W. Virginia 

Consol. Pub. Ret. Bd., 236 W. Va. 188, 778 S.E.2d 637 (2015); Charleston Area Med. Ctr., 

Inc. v. State Tax Dep't of W. Virginia, 224 W. Va. 591, 687 S.E.2d 374 (2009) (per curiam); 
15

We move on to consider whether any recognized exception to sovereign 

immunity is applicable. First, we address whether Air Evac seeks prospective or retroactive 

relief. “The crucial date for drawing a line between prospective and retroactive relief 

should be the initiation of the relevant . . . action and not the date of judgment.” Syl. Pt. 1, 

Skaff v. Pridemore, 200 W. Va. 700, 490 S.E.2d 787 (1997) (citation omitted). Further, 

“where the relief sought involves an attempt to obtain a retroactive monetary recovery 

against the official based on his prior acts and which recovery is payable from State funds, 

the constitutional immunity provision bars such relief.” Id. at Syl. Pt. 2 (citation omitted).

Maupin v. Sidiropolis, 215 W. Va. 492, 493, 600 S.E.2d 204, 205 (2004) (per curiam). Air 

Evac highlights that each case is an administrative matter involving a payment dispute with 

the State. Air Evac reasons that because the Supreme Court of Appeals of West Virginia

heard these matters, sovereign immunity is no obstacle here. However, none of these cases

ever addressed the applicability of sovereign immunity, let alone proclaimed

administrative matters categorically exempt from sovereign immunity. Air Evac asks this 

Court for a profound holding based upon little authority. Here, we find Kanawha County

Public Library Board v. Board of Education of County of Kanawha, 231 W. Va. 386, 396, 

745 S.E.2d 424, 434 (2013) instructive:

While this Court has noted its authority to sua sponte

determine jurisdictional issues, including standing, it does not 

follow that an issue neither asserted by the parties nor 

addressed in this Court's opinions is binding upon it. This 

Court, like many others including the United States Supreme 

Court, adheres to the well-settled premise that “the exercise of 

jurisdiction in a case is not precedent for the existence of 

jurisdiction.”

Acknowledging the constitutional gravity of sovereign immunity, we decline to hold what

the Supreme Court of Appeals of West Virginia has not. 
16

The parties dispute whether October 24, 2019—the date Air Evac initiated 

its request for a contested hearing regarding its payment demand—draws the line for 

prospective relief. From our review of the record, this demand is the first time that Air Evac 

formally sought payment as relief.27 In Skaff v. Pridemore, 200 W. Va. 700, 705-6, 490 

S.E.2d 787, 792-3 (1997) (per curiam), the Supreme Court of Appeals of West Virginia

addressed the line-drawing challenges inherent to the prospective relief exception to 

sovereign immunity, which we find instructive:

Although this is not a mandamus action but rather an appeal 

from an order of the circuit court, the principles upon which 

Gribben was based are the same . . . Applying the Gribben

standard to these circumstances, we believe that the initiation 

of the appellees' Level IV grievance board complaint on 

August 16, 1991 is the crucial date, and conclude that pay 

awarded from that date is prospective and not barred by 

sovereign immunity. . . . [Accordingly,] the circuit court erred 

in making the award retroactive to October 16, 1989, inasmuch 

as the commencement date of the award should be August 16, 

1991. 

Id. 200 W. Va. at 703, 490 S.E.2d at 790 (discussing Gribben v. Kirk, 195 W. Va. 488, 

490, 466 S.E.2d 147, 149 (1995)). In Skaff, rather than considering the original grievance

as the point of “initiation,” the Supreme Court of Appeals of West Virginia considered the

filing that produced the original decision appealed from—in that case a Level IV grievance 

board complaint—to denote the “initiation of the relevant action.” Id. Turning to the case 

at hand, the matter on appeal before this Court originated from Air Evac’s October 24, 

2019, demand letter. The transports Air Evac seeks payment for occurred between June 9, 

27 See No. 23-ICA-127, A.R. 68 (Demand for Contested Hearing); 147–48 

(Cheatham Complaint).
17

2016, and June 4, 2019. Because all transports predate the initiation of this matter, we 

conclude the relief sought is retroactive, not prospective; therefore, this exception to 

sovereign immunity does not apply.

Air Evac’s final argument supports the circuit court’s order, seeking to offer 

a separate exception to sovereign immunity. Relying on Mellon-Stuart Co. v. Hall, 178 W. 

Va. 291, 296, 359 S.E.2d 124, 129 (1987), the circuit court found that the monetary relief 

sought by Air Evac stemmed from legislatively appropriated funds which, by virtue of 

being assigned to PEIA by the Legislature, were purposefully intended to be disbursed to 

providers like Air Evac for their charges. Referencing various cases,28 the circuit court 

reasoned that:

Sovereign immunity is inapplicable where the Legislature 

itself creates a program, appoints an agency to administer it, 

and requires the agency to make payment out of funds 

appropriated for that purpose. Seeking payment under such a 

scheme, as Air Evac has done here, simply does not implicate 

"the policy which underlies sovereign immunity," which "is to 

prevent the diversion of State monies from legislatively 

appropriated purposes." Mellon-Stuart Co. v. Hall, 178 W. Va. 

291, 296 (1987).29

28 In reaching this conclusion, the circuit court relied on three cases. See Curry v. 

W. Virginia Consol. Pub. Ret. Bd., 236 W. Va. 188, 778 S.E.2d 637 (2015); Charleston 

Area Med. Ctr., Inc. v. State Tax Dep't of W Virginia, 224 W. Va. 591, 687 S.E.2d 374 

(2009) (per curiam); Maupin v. Sidiropolis, 215 W. Va. 492, 493, 600 S.E.2d 204, 205 

(2004) (per curiam). Similarly to Air Evac’s argument addressed above, we find the circuit 

court misapprehended the value of these cases in concluding that an exception to sovereign 

immunity was applicable here. For a discussion of these cases, see supra note 26.

29 No. 23-ICA-127, A.R. 604 (Order).
18

The core principle from Mellon-Stuart underpinning the circuit court’s reasoning is an 

often cited one:

Broadly stated, the policy which underlies sovereign immunity 

is to prevent the diversion of State monies from legislatively 

appropriated purposes. Thus, where monetary relief is sought 

against the State treasury for which a proper legislative 

appropriation has not been made, sovereign immunity raises a 

bar to suit.

Id. at 296, 359 S.E.2d at 129. The circuit court misapplies Mellon-Stuart. There, plaintiffs 

sought compensation from a state agency for completed construction work and initiated a 

proceeding before the court of claims.

30 See id. at 295–96, 359 S.E.2d at 128–29. The court 

of claims issued a decision recommending plaintiffs be awarded their requested payment; 

however, the Legislature declined to appropriate any money to compensate those claims. 

Id. Before the Supreme Court of Appeals of West Virginia, plaintiffs requested that the 

agency be forced to pay its recommended claims from the agency’s budget. Id. The Court 

rejected this argument, declining to carve out a new exception in this context. Instead, the 

Court returned to the Pittsburgh Elevator exception31 as the only possible avenue for 

plaintiff’s recovery, reaffirming the general prohibition barring any monetary recovery that 

would directly draw from State funds.

Our central holding in Pittsburgh Elevator was that an action 

putatively against a State agency, which seeks recovery only 

from the agency's liability insurance, is not barred by sovereign 

30 The Court of Claims has been renamed the West Virginia Legislative Claims 

Commission. See W. Va. Code § 14-2-4 (2017).

31 Pittsburgh Elevator Co. v. W. Virginia Bd. of Regents, 172 W. Va. 743, 310 

S.E.2d 675 (1983) (claims within the State’s insurance coverage and limits are not barred

by sovereign immunity).
19

immunity . . . consistent with the policy underlying sovereign 

immunity, since the availability of insurance proceeds assures 

that any damages recovered would not be paid out of State 

coffers.

Mellon-Stuart Co. v. Hall, 178 W. Va. 291, 296, 359 S.E.2d 124, 129 (1987) (emphasis 

added).

The factual context of Mellon-Stuart informs our understanding of 

“legislative appropriation.” There, while plaintiffs received a favorable recommendation

from the court of claims, the Legislature declined to make a specific appropriation to 

authorize compensation to the vendor; had the Legislature acted to approve the vendor’s 

claim, sovereign immunity would have fallen away.32 In light of the Legislature’s rejection

of a specific appropriation through the court of claims process, plaintiffs attempted an endrun around the need for legislative approval. Instead, relying on the court of claims’ 

recommendation, plaintiffs aimed to reach directly into the agency’s budget, requesting 

monetary relief. As above, this triggers the underlying rationale for sovereign immunity to 

bar such claims—the “diversion of state money from legislatively appropriated purposes 

to the payment of court awards.”

33

32 See State ex rel. McLaughlin v. W. Va. Ct. of Claims, 209 W. Va. 412, 415, 549 

S.E.2d 286, 289 (2001) (noting that only the Legislature can authorize the payment of 

Commission claims that are otherwise subject to our state's sovereign immunity).

33 Kerns v. Bucklew, 178 W. Va. 68, 72, 357 S.E.2d 750, 754 (1987); see also 

Mellon-Stuart Co. v. Hall, 178 W. Va. 291, 296, 359 S.E.2d 124, 129 (1987).
20

It follows then, that the “legislative appropriation” discussed in MellonStuart is akin to a legislative award of a specific sum to a specific entity, directly enacted 

by the Legislature. Therefore, returning to the case at hand, we conclude that the 

Legislature’s general act of assigning basic budget appropriations to a state insurance 

agency that has been delegated with discretionary powers in administering those funds,

does not amount to a “legislative appropriation” of the kind entertained in Mellon-Stuart 

which could pierce the State’s sovereign immunity against claims for monetary relief.

Ultimately, we fail to identify the foundation for the circuit court’s cited

exception to PEIA’s sovereign immunity. In Mellon-Stuart, arguments to expand the 

recognized exceptions to sovereign immunity were rejected; and in doing so, the Supreme 

Court of Appeals of West Virginia respected the broad grant of immunity afforded to the 

State by the West Virginia Constitution. We do the same.

IV. CONCLUSION

For the above reasons, we conclude that the circuit court erred in refusing to 

recognize PEIA’s sovereign immunity. Accordingly, we reverse the circuit court’s

December 16, 2022, Final Order Granting, in Part and Denying, in Part Air Evac EMS, 

Inc.’s Petition for Appeal and remand this matter to be dismissed with prejudice. 

Reversed and Remanded.