Opinion ID: 4553022
Heading Depth: 2
Heading Rank: 1

Heading: Threshold Arguments

Text: DHS first argues that neither the States nor the Organizations meet the “irreducible constitutional minimum of standing” and thus cannot be permitted to challenge the Rule. Lujan v. Defs. of Wildlife, 504 U.S. 555, 560 (1992). DHS further argues that the Plaintiffs may not bring suit because they do not fall within the zone of interests protected by the public charge statute. See Lexmark Int’l Inc. v. Static Control Components, Inc., 572 U.S. 118, 129 (2014). We disagree with DHS on both counts.
At the preliminary injunction stage, “a plaintiff’s burden to demonstrate standing will normally be no less than that required on a motion for summary judgment. Accordingly, to establish standing for a preliminary injunction, a plaintiff cannot rest on . . . mere allegations . . . but must set forth by affidavit or other evidence specific facts” that establish the “three familiar elements of standing: injury in fact, causation, and redressability.” Cacchillo v. Insmed, Inc., 27 638 F.3d 401, 404 (2d Cir. 2011) (internal quotation marks and citation omitted). Here, DHS argues that the States and Organizations have failed to establish injury in fact, which requires the Plaintiffs to show they have suffered “an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical.” Lujan, 504 U.S. at 560 (internal quotation marks and citations omitted). The States allege that they are injured because the Rule will cause many of their residents to forgo use of public benefits programs, thereby decreasing federal transfer payments to the states, reducing Medicaid revenue, increasing overall healthcare costs, and causing general economic harm. DHS argues that these projected harms do not suffice to show injury in fact because the facts asserted by the States at most establish a possible, rather than imminent, future injury, and because any economic losses will be offset by the money saved by not providing public benefits to those who disenroll. See Clapper v. Amnesty Int’l USA, 568 U.S. 398, 409 (2013). We are satisfied that the States have sufficiently established actual imminent harms. DHS itself anticipates that a significant number of non-citizens will disenroll from public benefits as a result of the Rule’s enactment, including 28 many who are not in fact subject to the Rule but who would be fearful of its consequences nonetheless. See 84 Fed. Reg. at 41,300-01, 41,463. When an agency action has a “predictable effect . . . on the decisions of third parties,” the consequences of those third party decisions may suffice to establish standing, even when the decisions are illogical or unnecessary. See Dep’t of Commerce v. New York, 139 S. Ct. 2551, 2566 (2019). Contrary to its disparagement before us of the likelihood of harm to the States from disenrollment, DHS acknowledged in its own explication of the costs and benefits considered in adopting the Rule that expected disenrollment will result in decreased federal funding to states, 84 Fed. Reg. at 41,485, decreased revenue for healthcare providers, id. at 41,486, and an increase in uncompensated care, id. at 41,384. DHS’s own predictions thus align with declarations submitted by the States documenting the Rule’s chilling effect on non-citizen use of public benefits – which began even prior to the Rule taking effect – and its anticipated economic impacts.16 Where the agency itself forecasts the injuries claimed by the States, we 16 For example, the Commissioner of Health of the State of New York stated that “even before the Final Rule has gone into effect, consumers have been calling . . . [and] inquiring about canceling their Medicaid or other health insurance coverage because of the Final Rule.” New York (“N.Y.”) J. App. 512. The Commissioner further notes that “[i]ndividuals without coverage will still need 29 agree with the Ninth Circuit that it is “disingenuous” for DHS to claim that the injury is not sufficiently imminent. San Francisco, 944 F.3d at 787 (finding state and local governments had standing to challenge the Rule). We are also unpersuaded by DHS’s argument that the States cannot establish injury in fact because any losses in funding will be offset by the savings accrued as fewer people seek public assistance. “[T]he fact that an injury may be outweighed by other benefits . . . does not negate standing.”17 Denney v. Deutsche and receive care” but without insurance “those costs will be borne by the healthcare delivery system.” Id. The President and CEO of New York City Health and Hospitals Corporation provided specific examples of patients refusing care or requesting disenrollment because of the Rule, and estimated that in the bestcase scenario, the Rule could result in a loss of $50 million in the first year for the municipal hospital system. See N.Y. J. App. 266-69; see also N.Y. J. App. 183 (Commissioner of the New York City Department of Social Services providing statistics evidencing a “striking and dramatic drop in non-citizen SNAP cases” since the public charge rule began to get media coverage); N.Y. J. App. 227, 23334 (Commissioner-Designate of Connecticut Department of Social Services estimating economic harms and increased healthcare costs); N.Y. J. App. 385-86 (Acting Secretary of the Agency of Human Services in Vermont predicting increased use of state-funded services). 17 For largely the same reason, we are not persuaded by DHS’s argument that the States’ losses will be offset by their continued receipt of Emergency Medicaid funds, a benefit not impacted by the Rule. We further note that Emergency Medicaid is limited to care provided after a “sudden onset of a medical condition manifesting itself by acute symptoms of sufficient severity” if immediate medical care is necessary to prevent serious health consequences. 42 C.F.R. § 440.255(b)(1), (c). That narrow definition is far from a blanket assurance that all or 30 Bank AG, 443 F.3d 253, 265 (2d Cir. 2006). In any event, this simplistic argument fails to account for the fact that the States allege injuries that extend well beyond reduced Medicaid revenue and federal funding to the States, including an overall increase in healthcare costs that will be borne by public hospitals and general economic harms. See, e.g., N.Y. J. App. 185 (explaining that “the SNAP program has a direct economic multiplier effect: for every one dollar in SNAP benefits received, there is an approximate $1.79 in increased economic activity”); N.Y. J. App. 512-13. Again, DHS itself identified these same broader harms as likely outcomes of the Rule. See, e.g., REGULATORY IMPACT ANALYSIS, INADMISSIBILITY ON PUBLIC CHARGE GROUNDS, RIN 1615-AA22, at 105-06 (2019) (calculating that reduced use of SNAP caused by the Rule will result in an estimated annual decrease of approximately $550 million in economic activity). We are satisfied that the States’ alleged economic harms are sufficiently concrete and imminent to constitute injury in fact. The Organizations allege injury on the grounds that the Rule has necessitated significant and costly changes in their programmatic work and caused increased demand on their social service programs. DHS contends that even most services rendered in an emergency-room setting will be covered. 31 the Organizations have only shown harm to their “abstract social interests” and that increased costs of representing clients after the Rule is not sufficient to confer standing. Appellants’ Br. at 23 (quoting Havens Realty Corp. v. Coleman, 455 U.S. 363, 379 (1982)). An organization need only show a “perceptible impairment” of its activities in order to establish injury in fact. Ragin v. Harry Macklowe Real Estate Co., 6 F.3d 898, 905 (2d Cir. 1993). Contrary to DHS’s assertion that the Organizations have merely altered the subject matter of their existing outreach work, the declarations submitted by the Organizations make clear that the Rule has required significant diversion of resources. For example, over the course of three months Make the Road New York conducted almost forty workshops for community members devoted exclusively to the Rule, necessitating the hiring of two part-time staff members. See Make the Road (“M.T.R.”) J. App. 319-20, 323. The complexities of the Rule required Catholic Charities to change its educational outreach from group sessions to time-intensive individual meetings and to institute a series of evening phone banks. See M.T.R. J. App. 344, 349-51. The African Services Committee is funding a campaign of radio-based public service announcements to disseminate information about the Rule and has documented 32 an increased demand on its social service programs, as clients turn away from public benefits programs.18 See M.T.R. J. App. 466-67, 470. “[A] nonprofit organization establishes an injury-in-fact if, as here, it establishes that it spent money to combat activity that harms its . . . core activities.” Centro de la Comunidad Hispana de Locust Valley v. Town of Oyster Bay, 868 F.3d 104, 111 (2d Cir. 2017) (internal quotation marks omitted). The Organizations are dedicated to providing an array of legal and social services to non-citizens and they have expended significant resources to mitigate the Rule’s impact on those they serve. In so doing, they have diverted resources that would otherwise have been available for other programming, a “perceptible opportunity cost” that suffices to confer standing. Nnebe v. Daus, 644 F.3d 147, 157 (2d Cir. 2011). The Rule will also impede the Organizations’ abilities to carry out their responsibilities in a variety of ways. Oyster Bay, 868 F.3d at 110 (finding standing 18 Similarly, the Asian American Federation has devoted resources to a press conference and media-based outreach campaign and plans to reallocate staff to implement new programmatic priorities in light of the Rule. See M.T.R. J. App. 487, 490-91. And the Catholic Legal Immigration Network has seen a three-fold increase in the volume of inquiries related to the public charge ground and anticipates redirecting staff currently assigned to other projects to respond to the Rule. See M.T.R. J. App. 502-04. 33 where an organization “face[d] increased difficulty in meeting with and organizing [day] laborers”). For example, the Asian American Federation, which “support[s] culturally appropriate health and human services for Asian American immigrants[,]” is preparing to establish a network of social service providers that will not ask for immigration status information in order to provide alternatives for non-citizens who will not access public benefits because of the Rule. M.T.R. J. App. 485-86, 490. And while Catholic Charities was previously able to assign adjustment of status cases to paralegals working under the supervision of accredited representatives or attorneys, it anticipates that most of the adjustment cases for its predominantly low-income clients will now need to be handled by an attorney and require in-person representation at adjustment interviews. M.T.R. J. App. 346-48. These injuries constitute “far more than simply a setback to the [Organizations’] abstract social interests.” Havens Realty, 455 U.S. at 379. Even before its entry into force, the Rule has caused a “perceptible impairment” of the Organizations’ activities and further harms are imminent. Oyster Bay, 868 F.3d at 110 (internal quotation marks omitted). As with the States, we conclude that the injuries alleged by the Organizations suffice to confer Article III standing. 34
DHS also argues that neither group of Plaintiffs falls within the zone of interests of the public charge statute. The zone-of-interests test restricts the ability to bring suit to those plaintiffs whose interests are “arguably within the zone of interests to be protected or regulated by the statute that [they] say[] was violated.” Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians v. Patchak, 567 U.S. 209, 224 (2012) (internal quotation marks omitted). Because Congress intended to make agency action presumptively reviewable under the APA, that test is not especially demanding in the context of APA claims and may be satisfied even if there is no “indication of congressional purpose to benefit the would-be plaintiff.” Clarke v. Sec. Indus. Ass’n, 479 U.S. 388, 399-400 (1987). A plaintiff is precluded from bringing suit only where its “interests are so marginally related to or inconsistent with the purposes implicit in the statute that it cannot reasonably be assumed that Congress intended to permit the suit.” Id. at 399. Here, DHS argues that the Plaintiffs’ interests fall outside the zone of interests of the statute because the Plaintiffs seek to facilitate greater use of public benefits by non-citizens, which it views as inconsistent with the purpose of the public charge ground. 35 This argument mischaracterizes both the purpose of the public charge statute and the Plaintiffs’ interests. DHS assumes the merits of its own argument when it identifies the purpose of the public charge ground as ensuring that noncitizens do not use public benefits. As we conclude infra in Section II.B.6, Congress enacted the public charge ground to refuse admission to non-citizens who will likely be unable to support themselves in the United States, which is not tantamount to ensuring that non-citizens do not access any public benefits. Moreover, when we consider the role of the public charge ground within the broader context of the INA, a fuller picture of the interests implicated in the statute emerges. See Air Courier Conference of Am. v. Am. Postal Workers Union, 498 U.S. 517, 529 (1991) (explaining the Supreme Court’s reasoning in Clarke that, in the context of the National Bank Act “the zone-of-interests test was to be applied not merely in the light of § 36, which was the basis of the plaintiffs’ claim on the merits, but also in the light of § 81, to which § 36 was an exception”). The public charge statute delineates a category of persons who are to be denied adjustment of status (or another form of admission) to which they would otherwise have a claim. See, e.g., 8 U.S.C. § 1255 (detailing requirements for adjustment of status). The grounds of inadmissibility are the fulcrum on which Congress balances its 36 interest in allowing admission where it advances goals of family unity and economic competitiveness against its interest in preventing certain categories of persons from entering the country. See 84 Fed. Reg. at 41,306. DHS suggests that only those parties advocating increasingly harsher interpretations of the grounds of inadmissibility could fall within the zone of interests protected by the statute. That is too narrow a read of both the zone-of-interests test itself and the interests protected by the public charge ground. Understood in context, its purpose is to exclude where appropriate and to not exclude where exclusion would be inappropriate. See Patchak, 567 U.S. at 225-26. As with the interests protected by the statute, DHS mischaracterizes the Plaintiffs’ interests when it claims they seek only increased non-citizen enrollment in public benefits. The States actually seek to protect the economic benefits that result from healthy, productive, and engaged immigrant communities. And the Organizations’ interests stem from their assorted missions to increase non-citizen well-being and status, which they express in their work to provide legal and social services to non-citizens. An overbroad interpretation of the public charge ground, tipping the balance too far in the direction of exclusion at the expense of admission in the interest of family unity and economic vitality, 37 imperils both these interests. See Clarke, 479 U.S. at 399 n.14 (finding zone of interests could apply to “those whose interests are directly affected by a broad or narrow interpretation of the [statute]” (internal quotation marks omitted)). The Plaintiffs are among “those who in practice can be expected to police the interests that the statute protects[,]” namely, the admission of non-citizens who will be self-sufficient and the exclusion of those who will not. Fed. Defs. of N.Y., Inc. v. Fed. Bureau of Prisons, 954 F.3d 118, 131 (2d Cir. 2020) (internal quotation marks omitted); see Bank of Am. Corp. v. City of Miami, 137 S. Ct. 1296, 1304 (2017). We conclude that the States and the Organizations have Article III standing to challenge the Rule and that they fall within the zone of interests of the public charge statute. We thus turn to the merits of these appeals.