Court Opinion

ID: 3053284
Source: CourtListenerOpinion
Date Created: 2015-10-13 23:47:00.633571+00
Date Added: 2024-06-11T11:41:16.857108
License: Public Domain

FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

INDEPENDENT LIVING CENTER OF           
SOUTHERN CALIFORNIA, INC., a
nonprofit corporation; GRAY
PANTHERS OF SACRAMENTO, a
nonprofit corporation; GRAY
PANTHERS OF SAN FRANCISCO, a
nonprofit corporation; GERALD
SHAPIRO, PHARM. D. doing business
as UPTOWN PHARMACY AND GIFT                   No. 08-56061
SHOPPE; SHARON STEEN doing                       D.C. No.
business as CENTRAL PHARMACY;
MARK BECKWITH; MARGARET
                                          2:08-cv-03315-CAS-
                                                  MAN
DOWLING; TRAN PHARMACY, INC.,
doing business as TRAN PHARMACY;                OPINION
JASON YOUNG,
             Petitioners-Appellants,
                 v.
SANDRA SHEWRY, Director of the
Department of Health Care
Services, State of California,
              Respondent-Appellee.
                                       
       Appeal from the United States District Court
           for the Central District of California
       Christina A. Snyder, District Judge, Presiding

                   Argued and Submitted
            July 11, 2008—Pasadena, California

                 Filed September 17, 2008

     Before: Stephen Reinhardt, Marsha S. Berzon, and
            Milan D. Smith, Jr., Circuit Judges.

                            13025
13026   INDEPENDENT LIVING CENTER v. SHEWRY
            Opinion by Judge Berzon
            INDEPENDENT LIVING CENTER v. SHEWRY       13029

                        COUNSEL

Lynn S. Carman and Stanley L. Friedman (argued) for Inde-
pendent Living Center of Southern California, et al.,
petitioners-appellants.

Edmund G. Brown, Jr., Attorney General of the State of Cali-
fornia; Richard T. Waldow, Supervising Deputy Attorney
General; Jennifer M. Kim (argued), Supervising Deputy
Attorney General; Phillip J. Matsumoto, Tara L. Newman,
Gregory M. Cribs, and Sara Ugaz, Deputy Attorneys General;
for Sandra Shewry, Director of the Department of Health Care
Services of the State of California, respondent-appellee.
13030           INDEPENDENT LIVING CENTER v. SHEWRY
                                OPINION

BERZON, Circuit Judge:

   Petitioner-appellants, a group of pharmacies, health care
providers, senior citizens’ groups, and Medi-Cal beneficiaries
(collectively “ILC”),1 seek to enjoin a state official from
implementing legislation reducing payments to medical ser-
vice providers under the state’s Medicaid program, known as
“Medi-Cal,” by ten percent. ILC alleged in its complaint that
the state legislation violates certain provisions of the federal
Medicaid Act, and is therefore preempted under the Suprem-
acy Clause.2 Although ILC sought preliminary relief, the dis-
trict court denied any such relief, holding that ILC could not
allege any viable claim for injunctive relief because none of
the petitioners or their members have any federal right to
  1
     Petitioner-appellants include the Independent Living Center of South-
ern California, a non-profit corporation providing services to over 8,000
disabled individuals annually; Gray Panthers of Sacramento and San Fran-
cisco, senior citizens’ advocacy groups whose members include a number
of Medi-Cal recipients; Gerald Shapiro, a licensed registered pharmacist
operating Uptown Pharmacy & Gift Shoppe, which delivers prescription
drugs to roughly 5,000 home-bound patients in Los Angeles; Sharon
Steen, co-owner of Central Pharmacy in Santa Monica; Mark Beckwith,
a quadriplegic suffering from spinal muscular atrophy who receives medi-
cal and pharmacy services under Medi-Cal; Margaret Dowling, a paraple-
gic who receives part of her medical services under Medi-Cal; Jason
Young, an individual suffering from blindness and brain damage who
receives in-home support services from a Medi-Cal managed care pro-
gram; and Tran Pharmacy, Inc., a California corporation operating a retail
pharmacy in Garden Grove. Independent Living Center, the Gray Pan-
thers, and the pharmacy petitioners also sued to assert the interests of their
respective patients and members. We refer to petitioner-appellants collec-
tively as “petitioners,” “Independent Living Center,” or “ILC.”
   2
     The Supremacy Clause provides that “[t]his Constitution, and the Laws
of the United States which shall be made in Pursuance thereof . . . shall
be the supreme Law of the Land; and the Judges in every State shall be
bound thereby, any Thing in the Constitution or Laws of any State to the
Contrary notwithstanding.” U.S. CONST. art. VI, cl. 2.
             INDEPENDENT LIVING CENTER v. SHEWRY          13031
Medi-Cal payments or benefits. We do not agree that this suit
fails for this threshold reason, and therefore reverse.

                               I.

                              A.

   Under Title XIX of the Social Security Act, 42 U.S.C.
§ 1396 et seq. (the “Medicaid Act”), the federal government
provides funds to participating states to “enabl[e] each State,
as far as practicable . . . to furnish [ ] medical assistance on
behalf of families with dependent children and of aged, blind,
or disabled individuals, whose income and resources are
insufficient to meet the costs of necessary medical services[.]”
42 U.S.C. § 1396. Medicaid is a cooperative federal-state pro-
gram, enacted by Congress pursuant to its powers under the
Spending Clause, see U.S. CONST. art. I, § 8, cl. 1, that “ ‘di-
rects federal funding to states to assist them in providing med-
ical assistance to low-income individuals.’ ” Ball v. Rodgers,
492 F.3d 1094, 1098 (9th Cir. 2007) (quoting Katie A. v. Los
Angeles County, 481 F.3d 1150, 1153-54 (9th Cir. 2007)). To
receive federal funds, states are required to administer their
programs in compliance with individual “State plans for med-
ical assistance” approved by the federal Secretary of Health
and Human Services. 42 U.S.C. § 1396. The Act sets forth
detailed requirements for state plans, see id. § 1396a(a)(1)-
(71), including the specific provision at issue in this appeal.

   Under that provision, § 1396a(a)(30)(A) (“Section 30(A)”),
a state plan must:

    provide such methods and procedures relating to . . .
    the payment for[ ] care and services . . . as may be
    necessary . . . to assure that payments are (consistent
    with efficiency, economy, and quality of care and are
    sufficient to enlist enough providers so that care and
    services are available under the plan at least to the
13032        INDEPENDENT LIVING CENTER v. SHEWRY
    extent that such care and services are available to the
    general (population in the geographic area[.]

That is, a state plan must establish reimbursement rates for
health care providers that are both consistent with high-
quality medical care (the “quality of care provision”) and suf-
ficient to enlist enough providers to ensure that medical ser-
vices are generally available to Medicaid recipients (the
“access to care provision”). See generally Orthopaedic Hosp.
v. Belshe, 103 F.3d 1491 (9th Cir. 1997).

                               B.

   California Assembly Bill X3 5 (“AB 5”), enacted on Febru-
ary 16, 2008, during a special session convened by the Gover-
nor to address the state’s budget deficit, reduces payments to
medical providers participating in the state’s Medi-Cal pro-
gram by ten percent. Section 14 of AB 5 instructs the Director
of the Department of Health Care Services, the state agency
responsible for administering the Medi-Cal program, to
reduce payments to physicians, dentists, pharmacies, adult
day health care centers, clinics, health systems and other pro-
viders participating in Medi-Cal’s fee-for-service program by
ten percent. See CAL. WELF. & INST. CODE § 14105.19 (2008).
Section 14 also reduces payments to managed health care
plans under contract with the Department by the “actuarial
equivalent” of ten percent. Id. Section 15 of AB 5 instructs
the Director to reduce payments for inpatient services pro-
vided by acute care hospitals not under contract with the
Department by ten percent. See id. § 14166.245. All of these
cuts were scheduled to take effect July 1, 2008.

   ILC filed this suit in California state court seeking to enjoin
implementation of AB 5 on April 22, 2008, maintaining that
the ten-percent rate reduction violates both the “quality of
care” and “access to care” provisions of § 30(A) and is there-
fore invalid under the federal Constitution’s Supremacy
Clause, as it conflicts with governing federal law. The com-
               INDEPENDENT LIVING CENTER v. SHEWRY                 13033
plaint alleged that even prior to passage of AB 5, a substantial
percentage of medical care providers — 45% of primary care
providers and 50% of specialists — were unwilling to partici-
pate in the Medi-Cal program due to low reimbursement
rates; that 90% of dentists refused to accept Medi-Cal
patients; and that Medi-Cal’s reimbursement rates for pre-
scription drugs allowed pharmacies to “uniformly earn less
than a 10% net profit.” By further reducing already-low reim-
bursement rates, ILC argued, AB 5 would drive even more
primary care physicians, specialists, dentists, and pharmacies
out of the Medi-Cal program and force existing providers to
reduce services. As a result, ILC contended, Medi-Cal recipi-
ents would be “denied quality medical services and access to
quality medical services,” in violation of § 30(A). ILC also
maintained that nothing in the legislative history of AB 5
demonstrated that the legislature had considered whether
reduced payments would be consistent with efficiency, econ-
omy, and quality of care, or whether such payments would be
sufficient to enlist an adequate network of health care provid-
ers. Rather, the sole purpose cited in the legislation was to
“address[ ] the fiscal emergency declared by the Governor”
and “implement cost containment measures affecting health
services, at the earliest possible time.” ILC therefore
requested a peremptory writ of mandate or injunction to pre-
vent the Department of Health Care Services3 and its Director,
Sandra Shewry (“the Director”), from implementing AB 5.4

                                   C.

  The state defendants removed the suit to federal court,
where ILC filed a motion for preliminary injunction. The dis-
  3
     ILC voluntarily dismissed the Department from suit on June 1, 2008,
leaving the Director as the sole defendant.
   4
     ILC also alleged in its complaint that the ten-percent rate reduction
both violated and was preempted by the Americans with Disabilities Act
of 1990 (“ADA”), 42 U.S.C. § 12181 et seq. ILC voluntarily dismissed
these claims without prejudice.
13034        INDEPENDENT LIVING CENTER v. SHEWRY
trict court denied relief, holding that although it was “acutely
cognizant of the potential adverse consequences of the ten
percent rate reduction,” ILC had “no likelihood of succeeding
on the merits” because they “do not have any federal rights
under § 30(A).”

   In reaching this conclusion, the district court relied heavily
on this court’s decision in Sanchez v. Johnson, which held
that § 30(A) does not “create an individual right that either
Medicaid recipients or providers would be able to enforce
under [42 U.S.C.] § 1983.” 416 F.3d 1051, 1062 (9th Cir.
2005). Although the district court acknowledged that ILC in
this case filed suit under 28 U.S.C. § 1331 and the Supremacy
Clause rather than under § 1983, the court viewed this as a
distinction without a difference, reasoning that the Supremacy
Clause — like § 30(A) — “ ‘is not a source of any federal
rights.’ ” Golden State Transit Corp. v. City of Los Angeles,
493 U.S. 103, 107 (1989) (quoting Chapman v. Houston Wel-
fare Rights Org., 441 U.S. 600, 613 (1979)). In the absence
of any “right,” the district court concluded, ILC almost surely
had failed to state a claim for injunctive relief.

   In so ruling, the district court rebuffed ILC’s argument that
it was entitled to seek purely injunctive relief — which is all
it is seeking — on the basis of federal preemption under the
doctrine recognized in Shaw v. Delta Air Lines, Inc., 463 U.S.
85 (1983). Shaw held that “[a] plaintiff who seeks injunctive
relief from state regulation, on the ground that such regulation
is pre-empted by a federal statute which, by virtue of the
Supremacy Clause . . . , must prevail, thus presents a federal
question which the federal courts have jurisdiction under 28
U.S.C. § 1331 to resolve.” Id. at 96 n.14. The district court
held Shaw and its progeny — which, as we shall see, are
legion — inapplicable to ILC’s claims, holding that Shaw pre-
emption claims have been permitted in only three “circum-
stances”: (1) “where the plaintiff claims that a state law
requires him to act in violation of federal law;” (2) “where the
plaintiff contends that his conduct will be restricted by a state
               INDEPENDENT LIVING CENTER v. SHEWRY                 13035
law that is preempted by federal law;” and (3) “where state
law interferes with federally created rights.” The court con-
cluded that ILC’s claims did not fall under any of these three
categories, as “AB 5 neither compels nor restricts petitioners
own conduct” and “§ 30(A) does not give rise to a federally
created right.” ILC’s claims thus fell outside the Shaw
Supremacy Clause doctrine, rendering its probability of suc-
cess on the merits “low, if not wholly lacking.”

   ILC immediately sought emergency relief in this court. We
granted ILC’s motion to expedite oral argument, but denied
the balance of its emergency motion. We heard argument on
July 11, 2008, and issued an order the same day reversing the
district court’s decision and remanding for consideration of
the merits of ILC’s motion for preliminary injunction.5 This
opinion more fully sets forth the rationale for our July 11
order.

                                   II.

   We review a district court’s denial of a preliminary injunc-
tion for abuse of discretion. The Lands Council v. McNair,
___ F.3d ___, 2008 WL 2640001, at *3 (9th Cir. 2008) (en
banc). “A district court abuses its discretion in denying a
request for a preliminary injunction if it ‘base[s] its decision
on an erroneous legal standard or clearly erroneous findings
of facts.’ ” Id. (quoting Earth Island Inst. v. U.S. Forest Serv.,
442 F.3d 1147, 1156 (9th Cir. 2006)) (alteration in original).
We therefore review the district court’s legal rulings de novo
and its findings of fact for clear error. Id.; see also Perfect 10,
Inc. v. Amazon.com, Inc., 508 F.3d 1146, 1157 (9th Cir.
2007).
  5
   The district court heard argument on the merits of ILC’s motion for a
preliminary injunction on August 1, 2008, and subsequently entered an
order granting ILC’s motion in part. See Indep. Living Ctr. v. Shewry, No.
CV 08-3315 (C.D. Cal. Aug. 18, 2008), appeal filed, No. 08-56422 (9th
Cir. 2008).
13036        INDEPENDENT LIVING CENTER v. SHEWRY
  [1] In this case, the district court denied ILC’s motion for
a preliminary injunction based solely on its legal ruling that
ILC could not bring suit under the Shaw Supremacy Clause
doctrine. The only issue before this court is thus whether ILC
may maintain a valid cause of action to enjoin implementation
of AB 5 on the basis of federal preemption.

                              A.

   [2] The Supreme Court has repeatedly entertained claims
for injunctive relief based on federal preemption, without
requiring that the standards for bringing suit under § 1983 be
met, and without intimating that such claims must fit into one
of three categories or “circumstances” in order to be cogniza-
ble. In City of Burbank v. Lockheed Air Terminal, Inc., 411
U.S. 624 (1973), for example, the Court enjoined a city ordi-
nance prohibiting jet aircraft from taking off between 11 p.m.
and 7 a.m. Id. at 625-26. Plaintiffs, the owner and operator of
a private airport, filed suit under the Supremacy Clause, argu-
ing that the Federal Aviation Act preempted the city’s ordi-
nance. Id. at 626-27. As the Court noted, the Act permitted
the federal government “ ‘to possess and exercise complete
and exclusive national sovereignty in the airspace of the
United States,’ ” id. at 626-27 (quoting 49 U.S.C. § 1508(a)),
displacing both state and local regulation of airspace and —
presumably — any private “right” to occupy airspace at a
given time or place. Without questioning plaintiffs’ authority
to bring suit, the Court proceeded directly to the merits of
their claim for injunctive relief, holding the city’s ordinance
preempted under the Supremacy Clause. See id. at 633, 640.

   [3] In Ray v. Atlantic Richfield Co., 435 U.S. 151 (1978),
the Court proceeded along much the same path. Ray involved
a claim for injunctive relief brought by the operators of an oil
refinery and tanker vessels, who argued that the State of
Washington’s Tanker Law, which regulated the design, size,
and movement of oil tankers in Puget Sound, was preempted
by the federal Ports and Waterways Safety Act (PWSA). Id.
               INDEPENDENT LIVING CENTER v. SHEWRY                  13037
at 154-56. Without comment on plaintiffs’ authority to bring
suit under the Supremacy Clause, the Court once again pro-
ceeded straight to the preemption analysis. See id. at 157.
Indeed, none of the Court’s seminal preemption cases casts
any doubt on the presumptive availability of declaratory and
injunctive relief under the Supremacy Clause; to the contrary,
the Court has consistently assumed — without comment —
that the Supremacy Clause provides a cause of action to
enjoin implementation of allegedly unlawful state legislation.
See Gade v. Nat’l Solid Wastes Mgmt. Ass’n, 505 U.S. 88
(1992); Pac. Gas & Elec. Co. v. State Energy Res. Conserva-
tion & Dev. Comm’n, 461 U.S. 190 (1983); Fla. Lime & Avo-
cado Growers, Inc. v. Paul, 373 U.S. 132 (1963); see also
RICHARD H. FALLON, DANIEL J. MELTZER, & DAVID L. SHAPIRO,
HART & WECHSLER’S THE FEDERAL COURTS & THE FEDERAL
SYSTEM 903 (5th ed. 2003) (describing “the rule that there is
an implied right of action to enjoin state or local regulation
that is preempted by a federal statutory or constitutional pro-
vision” as “well-established”).

   [4] Perhaps the most well-known in this line of cases is
Shaw v. Delta Air Lines, Inc. Shaw involved the claims of
several large employers, who brought suit against the Acting
Commissioner of the New York State Division of Human
Rights, arguing that the State’s Human Rights and Disability
Benefits Laws — which required employers to treat preg-
nancy no differently than any other non-occupational disabil-
ity — were preempted by the federal Employee Retirement
Income Security Act (“ERISA”). 463 U.S. at 92. ERISA does
not confer any express cause of action on employers to chal-
lenge state benefits laws in federal court,6 but the Court —
  6
    Section 502(a) of the Act expressly allows participants, beneficiaries,
and fiduciaries of a covered employee benefits plan, as well as the Secre-
tary of Labor, to maintain a cause of action under ERISA. See 29 U.S.C.
§ 1132(a). The same provision, however, is silent as to employers, and has
generally been interpreted to mean that an employer cannot maintain an
action directly under ERISA. See, e.g., DeMarco v. C & L Masonry, Inc.,
13038          INDEPENDENT LIVING CENTER v. SHEWRY
much as it had in City of Burbank and Ray — reached the
merits of the preemption claims anyway, holding that the state
legislation was preempted only insofar as it prohibited prac-
tices that were otherwise lawful under ERISA. Id. at 108-09.
In an oft-cited footnote, the Court emphasized that its decision
in Franchise Tax Board v. Construction Laborers Vacation
Trust, 463 U.S. 1 (1983), decided the same day, “does not call
into question the lower courts’ jurisdiction to decide these
cases.”7 463 U.S. at 96 n.14. Rather, the Court reaffirmed the
general rule that a plaintiff seeking to enjoin state law based
on federal preemption maintains a valid federal cause of
action. As the Court explained,

     It is beyond dispute that federal courts have jurisdic-
     tion over suits to enjoin state officials from interfer-
     ing with federal rights.[8] A plaintiff who seeks

891 F.2d 1236, 1240-41 (6th Cir. 1989); Tuvia Convalescent Ctr., Inc. v.
Nat’l Union of Hosp. & Health Care Employees, 717 F.2d 726, 729-30 (2d
Cir. 1983). But see Associated Builders & Contractors v. Carpenters
Vacation & Holiday Trust Fund, 700 F.2d 1269, 1278 (9th Cir. 1983)
(allowing suits by employers in narrow circumstances).
   7
     Franchise Tax Board applied the “well-pleaded complaint rule” to hold
that federal courts lacked jurisdiction to hear cases in which a defendant
asserted ERISA preemption as a defense to an action brought by state tax
authorities to enforce its levies against funds held in ERISA-covered
employee benefit plans. 463 U.S. at 28. Shaw distinguished Franchise Tax
Board by noting that the Tax Board sought a declaration that state laws
were not preempted, whereas the employers in Shaw presented an affirma-
tive claim that the state laws at issue were preempted. See Shaw, 463 U.S.
at 96 n.14.
   8
     Although Shaw utilized the term “federal rights,” it did so before that
term had taken on the added significance attributed to it in more recent
cases such as Gonzaga University v. Doe, 536 U.S. 273 (2002), discussed
below. Shaw’s description of ERISA makes clear that the Court did not
view the statute as creating any substantive “rights” in employers. To the
contrary, the Court described ERISA as “a comprehensive statute designed
to promote the interests of employees and their beneficiaries in employee
benefit plans,” 463 U.S. at 90 (emphasis added), and noted that the statute
itself “does not mandate that employers provide any particular benefits,”
id. at 91.
                INDEPENDENT LIVING CENTER v. SHEWRY                   13039
      injunctive relief from state regulation, on the ground
      that such regulation is pre-empted by a federal stat-
      ute which, by virtue of the Supremacy Clause of the
      Constitution, must prevail, thus presents a federal
      question which the federal courts have jurisdiction
      under 28 U.S.C. § 1331 to resolve.

Id. (internal citations omitted). The Court concluded by noting
that it “frequently has resolved pre-emption disputes in a sim-
ilar jurisdictional posture,” citing, inter alia, Ray and Florida
Lime & Avocado Growers. Id. Thus, Shaw did not give rise
to some unique line of “Shaw preemption” cases, but merely
reaffirmed the traditional rule that injunctive relief is pre-
sumptively available in federal court to enjoin state officers
from implementing a law allegedly preempted under the
Supremacy Clause.9 See Lawrence County v. Lead-Deadwood
Sch. Dist. No. 40-1, 469 U.S. 256, 259 n.6 (1985) (describing
Shaw as “reaffirming the general rule” that a plaintiff assert-
ing preemption under the Supremacy Clause has stated a fed-
eral claim for injunctive relief).

                                     B.

  [5] Contrary to the district court’s conclusion that “Shaw
preemption claims” have been permitted in only three “cir-
cumstances,” we know of no authority limiting Shaw in this
manner, nor has the Director cited any. In fact, the Supreme
Court recently reaffirmed Shaw’s holding, maintaining that it
had “no doubt” as to the authority of private parties to seek
  9
    Indeed, Shaw itself traced the roots of the doctrine to Ex parte Young,
209 U.S. 123 (1908), decided seventy-five years earlier. See 463 U.S. at
96 n.14. In Young, the Court found “ample justification” in the case law
to support its conclusion that “individuals who, as officers of the state, are
clothed with some duty in regard to the enforcement of the laws of the
state, and who threaten and are about to commence proceedings . . . to
enforce against parties affected an unconstitutional act, violating the Fed-
eral Constitution, may be enjoined by a Federal court of equity from such
action.” 209 U.S. at 155-56.
13040           INDEPENDENT LIVING CENTER v. SHEWRY
injunctive relief on the basis of federal preemption under 28
U.S.C. § 1331 and the Supremacy Clause. See Verizon Md.
Inc. v. Pub. Serv. Comm’n, 535 U.S. 635, 642-43 (2002).

   Nor are we certain on what grounds the district court con-
cluded that ILC lacked a valid cause of action in this case.
The first two of the district court’s three “circumstances” —
whether the challenged statute “restricts” or “compels” peti-
tioners’ own conduct — appear to reflect traditional standing
doctrine, which requires a litigant to “demonstrate that it has
suffered a concrete and particularized injury that is either
actual or imminent, that the injury is fairly traceable to the
defendant, and that it is likely that a favorable decision will
redress that injury.” Massachusetts v. E.P.A., 127 S. Ct. 1438,
1453 (2007). We address ILC’s standing to bring suit sepa-
rately below, as that inquiry raises questions apart from
whether the Supremacy Clause provides a valid cause of
action to seek injunctive relief on the basis of federal preemp-
tion.

   The parties have proceeded on the assumption that the dis-
trict court denied relief because ILC lacked any judicially
enforceable “rights” under the federal statute.10 The Director
  10
    As noted above, the district court also concluded that the Supremacy
Clause itself does not give rise to any federal “right” to legal relief. In
reaching this conclusion, however, the district court relied on a series of
cases holding that the Supremacy Clause does not give rise to rights
enforceable under § 1983, an altogether separate remedial scheme. See
Golden State Transit Corp., 493 U.S. at 107-08 (“Given the variety of sit-
uations in which preemption claims may be asserted, in state court and in
federal court, it would obviously be incorrect to assume that a federal right
of action pursuant to § 1983 exists every time a federal rule of law pre-
empts state regulatory authority. Conversely, the fact that a federal statute
has preempted certain state action does not preclude the possibility that the
same federal statute may create a federal right for which § 1983 provides
a remedy.” (emphasis added)); Chapman, 441 U.S. at 612-15 (holding that
the Supremacy Clause “is not a source of any federal rights” falling under
28 U.S.C. § 1343(3), the jurisdictional counterpart to § 1983). We explore
the distinction between claims for relief under § 1983 and claims for
injunctive relief on the basis of federal preemption more fully in Part B-
3 below.
             INDEPENDENT LIVING CENTER v. SHEWRY         13041
specifically urges this court to deny ILC relief “because
[§ 30(A)] does not confer a private right of enforcement upon
petitioners, which is the necessary predicate to seeking relief
under the Supremacy Clause.” Were we to accept it, this argu-
ment would work a fundamental change in Supremacy Clause
jurisprudence. We decline to do so, and thus join several other
circuits in holding that a plaintiff seeking injunctive relief
under the Supremacy Clause on the basis of federal preemp-
tion need not assert a federally created “right,” in the sense
that term has been recently used in suits brought under
§ 1983, but need only satisfy traditional standing require-
ments.

                              1.

   [6] Although the Director asserts that the express conferral
of a “private right of enforcement” on petitioners is a “neces-
sary predicate” to a claim for injunctive relief under the
Supremacy Clause, the well-established rule in both this court
and in other circuits is precisely the opposite. In Bud Antle,
Inc. v. Barbosa, 45 F.3d 1261 (9th Cir. 1994), we addressed
a claim for injunctive relief brought by a large agricultural
employer, who sought to enjoin the California Agricultural
Relations Board (ALRB) from adjudicating various unfair
labor practice charges. Id. at 1264. The employer argued that
the ALRB proceedings were preempted by the National Labor
Relations Act (NLRA), and were therefore invalid. Id. We
held that a private party may bring an action in a federal dis-
trict court seeking to enjoin allegedly unlawful state conduct,
noting the “general rule that a private party may seek declara-
tory and injunctive relief against the enforcement of a state
statutory scheme on the ground of federal preemption.” Id. at
1269-71 (citing Shaw). We reached this conclusion “[e]ven in
the absence of an explicit statutory provision establishing a
cause of action,” id. at 1269, and regardless of whether the
NLRA conferred a federal “right” on employers, see id. at
1271 n.13 (finding it unnecessary to apply the four-factor test
set forth in Cort v. Ash, 422 U.S. 66 (1975)).
13042        INDEPENDENT LIVING CENTER v. SHEWRY
   Our holding in Bud Antle is consistent with established
practice in the other circuits, which have universally affirmed
the right of private parties to seek injunctive relief under the
Supremacy Clause regardless of whether the allegedly pre-
emptive statute confers any federal “right” or cause of action.
As the Tenth Circuit explained,

    A federal statutory right or right of action is not
    required where a party seeks to enjoin the enforce-
    ment of a regulation on the grounds that the local
    ordinance is preempted by federal law. A party may
    bring a claim under the Supremacy Clause that a
    local enactment is preempted even if the federal law
    at issue does not create a private right of action.

Qwest Corp. v. City of Santa Fe, 380 F.3d 1258, 1266 (10th
Cir. 2004) (internal citations omitted); see also Local Union
No. 12004 v. Massachusetts, 377 F.3d 64, 75 (1st Cir. 2004)
(holding that “in suits against state officials for declaratory
and injunctive relief, a plaintiff may invoke the jurisdiction of
the federal courts by asserting a claim of preemption, even
absent an explicit statutory cause of action”); Ill. Ass’n of
Mortgage Brokers v. Office of Banks & Real Estate, 308 F.3d
762, 765 (7th Cir. 2002); St. Thomas - St. John Hotel & Tour-
ism Ass’n v. Virgin Islands, 218 F.3d 232, 241 (3d Cir. 2000)
(holding that “a state or territorial law can be unenforceable
as preempted by federal law even when the federal law
secures no individual substantive rights for the party arguing
preemption”); Village of Westfield v. Welch’s, 170 F.3d 116,
124 n.4 (2d Cir. 1999) (holding that a cause of action under
the Supremacy Clause “do[es] not depend on the existence of
a private right of action under the [preempting statute]”); Bur-
gio & Campofelice, Inc. v. N.Y. State Dep’t of Labor, 107
F.3d 1000, 1005-07 (2nd Cir. 1997) (holding that plaintiff
could assert ERISA preemption under the Supremacy Clause,
even though it was “beyond dispute” that plaintiff fell outside
ERISA’s express enforcement provisions); First Nat’l Bank of
E. Ark. v. Taylor, 907 F.2d 775, 776 n.3 (8th Cir. 1990).
               INDEPENDENT LIVING CENTER v. SHEWRY                  13043
                                    2.

   [7] The Director acknowledges these general principles but
argues for a different result in this case, based on the specific
statutory provision at issue. The Director provides little, if
any, justification for treating a claim of preemption under a
federal statute passed pursuant to Congress’s spending power
differently from a claim of preemption under any of the fed-
eral statutes discussed above. But even if she had, this argu-
ment has also been flatly rejected by the Supreme Court and
the other circuits that have addressed the question.

   In Pharmaceutical Research & Manufacturers of America
(“PhRMA”) v. Concannon, 249 F.3d 66 (1st Cir. 2001), aff’d
sub nom. PhRMA v. Walsh, 538 U.S. 644 (2003), a pharma-
ceutical manufacturers trade group challenged a Maine statute
designed to lower prescription drug prices for low-income
residents by essentially requiring manufacturers to issue
rebates.11 Id. at 71-72. PhRMA argued, inter alia, that
Maine’s statute was preempted by the federal Medicaid Act
under the Supremacy Clause, and moved for injunctive relief
to prevent implementation of the program. Id. at 72. In
response, the defendants contended that PhRMA could not
bring suit in this manner, as the Medicaid Act was not
intended to confer any private right on pharmaceutical manu-
facturers. Id. at 73. The First Circuit rejected the defendants’
argument, explaining that “PhRMA has not asserted an action
to enforce rights under the Medicaid statute . . . but rather a
preemption-based challenge under the Supremacy Clause. In
this type of action, it is the interests protected by the Suprem-
acy Clause, not by the preempting statute, that are at issue.”
Id. Citing a decision from the Third Circuit, the court noted:
  11
    To ensure pharmaceutical companies’ participation in the program,
the statute subjected all drugs produced by manufacturers refusing to offer
rebates to “prior authorization requirements,” meaning that the drug could
not be prescribed to a Medicaid beneficiary unless the state Medicaid
administrator specifically approved the prescription. See id. at 71-72.
13044        INDEPENDENT LIVING CENTER v. SHEWRY
       We know of no governing authority to the effect
    that the federal statutory provision which allegedly
    preempts enforcement of local legislation by conflict
    must confer a right on the party that argues in favor
    of preemption. On the contrary, a state or territorial
    law can be unenforceable as preempted by federal
    law even when the federal law secures no individual
    substantive rights for the party arguing preemption.

Id. (quoting St. Thomas - St. John Hotel & Tourism Ass’n,
218 F.3d at 241). The court thus concluded — in stark con-
trast to the Director’s position in this case — that “regardless
of whether the Medicaid statute’s relevant provisions were
designed to benefit PhRMA, PhRMA can invoke the statute’s
preemptive force.” Id.

   Although the First Circuit permitted PhRMA to bring suit,
the court ultimately held that Maine’s statute was not pre-
empted by federal law because there was no conflict between
its requirements and those of the Medicaid Act. See id. at 74-
79. PhRMA successfully petitioned the Supreme Court for
certiorari, and the state defendants renewed their claim that
PhRMA lacked any federal right to bring suit. Like the Direc-
tor in our case, defendants argued that “[the Supremacy
Clause] does not, by its own force, protect or regulate any
interests,” and that PhRMA must therefore “look to the alleg-
edly preempting federal statute to find an interest to support
standing.” Brief for Respondents at 13-17, PhRMA v. Walsh,
538 U.S. 644 (2003) (No. 01-188). PhRMA took issue with
this claim in its reply brief, noting that the Supreme Court and
the lower federal courts had “decided innumerable cases in
which parties claiming to be injured by a state law have chal-
lenged it as preempted by federal law” and that the Court had
never held “that a party directly claiming a Supremacy Clause
violation must demonstrate an enforceable right under the pre-
emptive federal law.” Reply Brief of Petitioner at 2-3,
PhRMA v. Walsh, 538 U.S. 644 (2003) (No. 01-188).
               INDEPENDENT LIVING CENTER v. SHEWRY                  13045
   Not acceding to the defendants’ argument that PhRMA
lacked a cause of action under the Supremacy Clause, seven
Justices reached the merits of PhRMA’s claim for injunctive
relief. See PhRMA v. Walsh, 538 U.S. at 668 (Stevens, J.,
joined by Souter, J., and Ginsburg, J.); id. at 671 (Breyer, J.);
id. at 684 (O’Connor, J., joined by Rehnquist, C.J., and Ken-
nedy, J.). Only Justices Scalia and Thomas would have denied
PhRMA’s ability to bring suit for preemption, although they
ultimately concurred in the Court’s judgment that Maine’s
statute was likely not preempted by the federal Medicaid Act.
See id. at 675 (Scalia, J., concurring in judgment); id. at 675-
83 (Thomas, J., concurring in judgment).12 Faced with argu-
ments similar to those presented by the Director in this case,
the Court necessarily assumed — albeit implicitly — that a
private party seeking to enjoin implementation of a state law
allegedly preempted by the federal Medicaid Act may bring
suit for injunctive relief directly under the Supremacy Clause.

   Although the Supreme Court’s decision in Walsh affirmed
PhRMA’s ability to bring suit under the Supremacy Clause
sub silentio, two circuits have expressly relied on Walsh to
permit suits for injunctive relief. In PhRMA v. Thompson, 362
F.3d 817 (D.C. Cir. 2004), the D.C. Circuit addressed a simi-
lar challenge to Michigan’s “Best Practices Initiative,” which
was designed — much like Maine’s statute — to provide low-
cost prescription drug coverage to state residents. Id. at 819.
Citing Justice Thomas’s opinion in Walsh, the defendants
argued that there were “serious questions as to whether third
parties may sue to enforce Spending Clause legislation —
  12
     Justices Scalia would have held that PhRMA could not bring suit,
because “the remedy for the State’s failure to comply with the obligations
it has agreed to undertake under the Medicaid Act is set forth in the Act
itself: termination of funding.” See id. at 675 (Scalia, J., concurring in
judgment). Justice Thomas argued that the broad discretion conferred by
statute on the Secretary of Health and Human Services defeated any pre-
emption claim, and doubted whether “Spending Clause legislation can be
enforced by third parties in the absence of a private right of action.” See
id. at 675-83 (Thomas, J., concurring in judgment).
13046          INDEPENDENT LIVING CENTER v. SHEWRY
through pre-emption or otherwise.” Id. at 819 n.3. The D.C.
Circuit rejected defendants’ argument, holding that by reach-
ing the merits of PhRMA’s preemption claim in Walsh, the
Supreme Court implicitly affirmed PhRMA’s authority to
bring suit for injunctive relief under the Supremacy Clause.
Id.

   In Planned Parenthood of Houston v. Sanchez, 403 F.3d
324 (5th Cir. 2005), the Fifth Circuit relied in part on the
Supreme Court’s decision in Walsh to permit a claim for
injunctive relief under the federal Social Security and Public
Health Services Acts. Id. at 331-32. Several local branches of
Planned Parenthood claimed that a Texas statute known as
“Rider 8,” which restricted the distribution of public funds for
family planning services to contractors who pledged not to
perform, or to contract with any individual or entity that per-
formed, any elective abortion procedures, was preempted by
federal law.13 Id. at 328. Plaintiffs argued, inter alia, that the
state statute violated the Supremacy Clause by imposing eligi-
bility requirements that were inconsistent with those imposed
under the federal funding statutes. Id.

   In assessing plaintiff’s claims for injunctive relief, the Fifth
Circuit began by noting that “[i]t is well-established that the
federal courts have jurisdiction under 28 U.S.C. § 1331 over
a preemption claim seeking injunctive and declaratory relief.”
Id. at 331 (citing Shaw). The court then cited Walsh and
Thompson for the principle that “asserting the preemptive
force of federal Spending Clause legislation” itself states a
claim for relief, even if “[Planned Parenthood was] not seek-
ing to vindicate any right or to enforce any duty running to
them.” Id. at 331-32. After a thorough canvassing of preemp-
tion cases, see id. at 331-34 & nn. 25, 27-28, 37, 46-47, the
court had “little difficulty . . . holding that [Planned Parent-
  13
    Texas accepted federal funds for family planning services by voluntar-
ily participating in a number of federal programs, including the Public
Health Services Act and the Social Security Act. Id. at 327.
                INDEPENDENT LIVING CENTER v. SHEWRY                  13047
hood had] an implied right of action to assert a preemption
claim seeking injunctive and declaratory relief.” Id. at 335.

   [8] We find the reasoning of the D.C. and Fifth Circuits per-
suasive.14 For more than a century, federal courts have enter-
tained suits seeking to enjoin state officials from
implementing state legislation allegedly preempted by federal
law, and we see no reason to depart from the general rule in
this case, or in this category of cases. We therefore join sev-
eral other circuits in holding that a party may seek injunctive
relief under the Supremacy Clause regardless of whether the
federal statute at issue confers any substantive rights on
would-be plaintiffs.

                                     3.

   [9] The reasoning adopted by the other circuits is also help-
ful in identifying the fundamental flaw with the Director’s
position. By maintaining that ILC cannot proceed unless it
can demonstrate that AB 5 interferes with some federally cre-
ated right, the Director essentially asks us to apply the test for
determining whether a plaintiff may seek relief under 42
  14
     The district court stated that ILC’s reliance on Concannon was mis-
placed because plaintiffs in that case had “established a concrete injury in
fact” — standing language, as we shall see — whereas “[h]ere, § 30(A)
does not give petitioners any right to Medi-Cal funds.” In fact, Concannon
expressly permitted PhRMA to bring suit for injunctive relief in the
absence of any statutory right to Medicaid funds. See 249 F.3d at 73. The
pharmaceutical manufacturers bringing suit in Concannon had no greater
“right” to Medicaid funds than the pharmacies and health care providers
in this case, and ILC has adequately alleged injury-in-fact. See Part II-C,
infra.
   Similarly, there is no viable distinction for present purposes between the
restrictions on Planned Parenthood’s activities imposed by the statute at
issue in Planned Parenthood v. Sanchez and the impact of AB 5 on the
Medi-Cal providers in this case. AB 5 allegedly prevents petitioners from
providing services to Medi-Cal beneficiaries unless they are willing to do
so at a financial loss, and thus assuredly “restricts” petitioners’ provision
of professional services.
13048           INDEPENDENT LIVING CENTER v. SHEWRY
U.S.C. § 1983, which provides a remedy for “the deprivation
of any rights, privileges, or immunities secured by the Consti-
tution and laws.”15 The Supreme Court has interpreted the text
of § 1983 to require a plaintiff to show the deprivation of “an
unambiguously conferred right” in order to support a cause of
action brought under § 1983. Gonzaga Univ. v. Doe, 536 U.S.
273, 283 (2002). But both the Supreme Court and the courts
of appeal have consistently rejected attempts to extend this
analysis to claims for purely prospective injunctive relief
under the Supremacy Clause, rendering the “rights” require-
ment inapplicable to ILC’s claims in this case.

   The Eighth Circuit’s decision in Lankford v. Sherman, 451
F.3d 496 (8th Cir. 2006), is instructive. In response to severe
“budget constraints,” the Missouri state legislature amended
its state Medicaid plan to eliminate coverage for durable med-
ical equipment (“DME”) for most categorically-needy Medic-
aid recipients. Id. at 500-01. Plaintiffs, a group of adult
Medicaid recipients, brought suit under both § 1983 and the
Supremacy Clause to enjoin state regulations implementing
the amendment, arguing that the cuts violated certain provi-
sions of the federal Medicaid Act. Id. at 500-02. Like the
Director in our case, the defendant argued “that there is no
individualized federal right to reasonable Medicaid stan-
dards.” Id. at 507. The court agreed with the defendant as to
the § 1983 claim, holding that “[r]ather than focusing on an
individualized entitlement to medical services, the reasonable-
standards provision [of the Medicaid Act] focuses on the
aggregate practices of the states in establishing reasonable
Medicaid services.” Id. at 509. The court noted, however, that
the § 1983 issue was not dispositive, as plaintiffs had also
  15
    Section 1983 provides: “Every person who, under color of any statute,
ordinance, regulation, custom, or usage, of any State, . . . subjects, or
causes to be subjected, any citizen of the United States or other person
within the jurisdiction thereof to the deprivation of any rights, privileges,
or immunities secured by the Constitution and laws, shall be liable to the
party injured in an action at law, suit in equity, or other proper proceeding
for redress . . . .” 42 U.S.C. § 1983.
             INDEPENDENT LIVING CENTER v. SHEWRY           13049
brought suit under the Supremacy Clause. “Preemption claims
are analyzed under a different test than section 1983 claims,
affording plaintiffs an alternative theory for relief when a
state law conflicts with a federal statute or regulation.” Id.
The lack of any federally created “right” under the Medicaid
Act was inconsequential to the Supremacy Clause analysis,
and plaintiffs’ preemption claim was remanded for consider-
ation on the merits. Id. at 513.

   The Fifth Circuit reached a similar conclusion in Planned
Parenthood v. Sanchez. As noted above, plaintiffs sought to
enjoin implementation of Texas’s Rider 8, which required
recipients of federal funds to cut all ties with any organization
performing elective abortions. Sanchez, 403 F.3d at 328.
Advancing the same arguments asserted by the Director in our
case, the Texas Department of Health contended that to seek
injunctive relief, “plaintiffs must meet the requirements for an
action under § 1983, as recently enunciated in Gonzaga Uni-
versity v. Doe,” namely, that the federal statutes at issue con-
fer privately enforceable “rights.” Id. at 335. The Fifth Circuit
flatly rejected this argument, finding that it “mischarac-
terize[d]” Planned Parenthood’s claim:

    Appellees are not asking the courts to enforce their
    “right” under § 1983 to secure enforcement of [the
    Public Health Safety Act], as TDH asserts. Rather,
    Appellees’ Supremacy Clause argument is funda-
    mentally different: they argue that Rider 8 imposes
    conditions on the receipt of federal funds that are
    incompatible with [the Act]. Therefore, we need not
    be concerned that the Supremacy Clause does not of
    its own force create rights enforceable under § 1983.

Id. The court then noted that “Gonzaga, by its terms, applies
only to § 1983 claims. . . . The Supremacy Clause claim
advanced here . . . is not based on a claim of right under [the
Act], nor is it a claim for damages; it is a preemption claim.
The Gonzaga Court gave no indication that it intended to alter
13050        INDEPENDENT LIVING CENTER v. SHEWRY
its prior practice regarding such claims.” Id. The court there-
fore concluded that a claim of preemption under the Suprem-
acy Clause “does not require a showing, as per Gonzaga, that
a § 1983 action would also be proper.” Id.; see also Local
Union No. 12004, 377 F.3d at 75-76 (distinguishing between
claims brought under § 1983 and claims for injunctive relief
under the Supremacy Clause); Qwest, 380 F.3d at 1266 & n.5
(same); Burgio & Campofelice, 107 F.3d at 1005-07 & n.2
(same).

   For the reasons identified by the Fifth Circuit in Planned
Parenthood v. Sanchez, the Director’s heavy reliance on our
decision in Sanchez v. Johnson, 416 F.3d 1051 (9th Cir.
2005), is misplaced. Johnson merely applied Gonzaga to a
claim seeking to enforce the substantive provisions of § 30(A)
of the Medicaid Act brought under § 1983. We held that the
quality of care and access provisions of § 30(A) do not give
rise to the type of unambiguously conferred “rights” required
under Gonzaga. See id. at 1055-60. But our decision in John-
son had nothing to say about a claim for injunctive relief
brought under the Supremacy Clause.

   [10] Indeed, even as the Supreme Court has tightened the
requirements for seeking damages under § 1983, it has consis-
tently reaffirmed the availability of injunctive relief to prevent
state officials from implementing state legislation allegedly
preempted by federal law. In Green v. Mansour, 474 U.S. 64
(1985), two classes of plaintiffs alleged that the State of
Michigan’s method of calculating benefits under the federal
Aid to Families With Dependent Children (AFDC) program
violated federal law. Id. at 65. While the suits were pending
in federal district court, the State altered its program to com-
ply with recent congressional amendments. Id. at 65-66.
These changes mooted plaintiffs’ claims for prospective
relief, since it was “undisputed that respondent’s calculations
thereafter have conformed to federal law.” Id. at 65. Plaintiffs
nonetheless sought “notice relief” and a declaration that
Michigan’s prior conduct violated federal law. Id.
             INDEPENDENT LIVING CENTER v. SHEWRY           13051
   The Court denied relief, holding that plaintiffs’ requests for
notice and declaratory relief constituted claims for retrospec-
tive damages and were thus barred by state sovereign immu-
nity under the Eleventh Amendment. Id. at 71-74. All nine
justices agreed, however, that injunctive relief would have
been available under the Supremacy Clause if changes to the
state program had not mooted plaintiffs’ prospective claims.
See id. at 68; id. at 77 (Brennan, J., dissenting). Writing for
the majority, then-Justice Rehnquist noted that “the availabil-
ity of prospective relief of the sort awarded in Ex parte Young
gives life to the Supremacy Clause. Remedies designed to end
a continuing violation of federal law are necessary to vindi-
cate the federal interest in assuring the supremacy of that
law.” Id. at 68.

   [11] The Director’s arguments fail to honor this distinction,
broadly asserting instead that because § 30(A) of the Medic-
aid Act does not confer any substantive “rights,” ILC is not
entitled to relief of any kind, whether prospective or retro-
spective. Green cautioned against conflating claims for pro-
spective and retrospective relief in precisely this manner,
recognizing that a state’s interest in continuing to flout bind-
ing federal law is illegitimate. 474 U.S. at 68; see also Idaho
v. Coeur d’Alene Tribe, 521 U.S. 261, 281 (1997) (“An alle-
gation of an ongoing violation of federal law where the
requested relief is prospective is ordinarily sufficient” to seek
injunctive relief under Ex parte Young). We therefore adhere
to the general rule that injunctive relief is presumptively
available to remedy a state’s ongoing violation of federal law.

                               C.

   [12] Because it held that ILC could not bring suit under the
Supremacy Clause, the district court did not technically reach
petitioners’ standing to bring suit. As noted above, however,
the first and second prongs of the district court’s Shaw analy-
sis — which focused on whether AB 5 “restricts” or “com-
pels” petitioners’ conduct — appear to reflect the traditional
13052           INDEPENDENT LIVING CENTER v. SHEWRY
requirement that a litigant demonstrate an injury-in-fact to
establish Article III standing. See Lujan v. Defenders of Wild-
life, 504 U.S. 555, 560 (1992). On appeal, the Director
expressly “does not allege that the named Petitioners do not
have standing to bring this action on their own behalf,” but
rather argues simply that “Petitioners cannot state a claim for
relief under the Supremacy Clause.”16 We nonetheless recog-
nize our “independent obligation” to examine our own juris-
diction, see FW/PBS, Inc. v. City of Dallas, 493 U.S. 215,
230-31 (1990), and therefore briefly address ILC’s Article III
standing.17

 [13] To satisfy Article III standing requirements, a plaintiff
must demonstrate three elements:

     First, the plaintiff must have suffered an injury in
     fact — an invasion of a legally protected interest
     which is (a) concrete and particularized; and (b)
   16
      Although the Director does not contest petitioners’ standing, she does
argue that the interests protected by § 30(A) are not judicially enforceable
because § 30(A) concerns “overall methodology” and “merely requires
states to consider various factors in setting reimbursement rates.” We
express no opinion regarding the correct interpretation of the substantive
provisions of § 30(A), as such arguments are properly addressed to the
merits of petitioners’ preemption claim. See Wilder v. Va. Hosp. Ass’n,
496 U.S. 498, 519 (1990) (“That [the statutory provision at issue] gives
the States substantial discretion in choosing among reasonable methods of
calculating rates may affect the standard under which a court reviews
whether the rates comply with the [statute], but it does not render the [stat-
ute] unenforceable by a court.”); Orthopaedic Hosp., 103 F.3d at 1496-
1500 (interpreting the substantive provisions of § 30(A)).
   17
      Unlike the Article III standing inquiry, whether ILC maintains pruden-
tial standing “is not a jurisdictional limitation on our review.” See Bd. of
Natural Res. v. Brown, 992 F.2d 937, 945-46 (9th Cir. 1993). By failing
to articulate any argument challenging ILC’s prudential standing, the
Director has waived that argument. Id. at 946; Greenwood v. F.A.A., 28
F.3d 971, 977 (9th Cir. 1994) (“We review only issues which are argued
specifically and distinctly in a party’s opening brief. We will not manufac-
ture arguments for an appellant, and a bare assertion does not preserve a
claim . . . .” (internal citation omitted)).
             INDEPENDENT LIVING CENTER v. SHEWRY           13053
    actual or imminent, not conjectural or hypothetical.
    Second, there must be a causal connection between
    the injury and the conduct complained of — the
    injury has to be fairly traceable to the challenged
    action of the defendant, and not the result of the
    independent action of some third party not before the
    court. Third, it must be likely, as opposed to merely
    speculative, that the injury will be redressed by a
    favorable decision.

Lujan, 504 U.S. at 560-61 (internal citations and quotation
marks omitted). “The general rule applicable to federal court
suits with multiple plaintiffs is that once the court determines
that one of the plaintiffs has standing, it need not decide the
standing of the others.” Leonard v. Clark, 12 F.3d 885, 888
(9th Cir. 1993). In this case, we have no doubt that several of
the petitioners, at least, have standing to challenge the imple-
mentation of AB 5.

   [14] Petitioners include independent pharmacies and health
care providers participating in the State’s Medi-Cal program
that, according to their complaint, will be “directly injured, by
loss of gross income,” when the ten-percent rate reduction
takes effect. The Supreme Court “repeatedly has recognized
that such [direct economic] injuries establish the threshold
requirements” of Article III standing. Craig v. Boren, 429
U.S. 190, 194-95 (1976). Moreover, this injury is directly
traceable to the Director’s implementation of AB 5, and
would certainly be redressed by a favorable decision of this
court enjoining the ten-percent rate reduction.

   [15] Petitioners also include several individual Medi-Cal
beneficiaries, who “will be injured or put at risk of injury by
implementation of the 10% provider payments cuts” because
those cuts will reduce “quality services, and access to quality
services.” This injury, like the injury to medical providers dis-
cussed above, is the direct result of the Director’s implemen-
tation of AB 5, and would certainly be remedied by a decision
13054        INDEPENDENT LIVING CENTER v. SHEWRY
granting injunctive relief. Such an injury “to those individuals
most directly affected by the administration of [a state wel-
fare] program” is sufficient to allow petitioners to seek
injunctive relief in federal court. Rosado v. Wyman, 397 U.S.
397, 420 (1970).

                         Conclusion

   Under well-established law of the Supreme Court, this
court, and the other circuits, a private party may bring suit
under the Supremacy Clause to enjoin implementation of state
legislation allegedly preempted by federal law. In this case,
ILC alleges that the cuts mandated by AB 5 violate the sub-
stantive provisions of the federal Medicaid Act, and are there-
fore unlawful. They do not seek to enforce any substantive
“right” conferred by statute; instead, they argue that the cuts
mandated by AB 5 are themselves unenforceable, because
they exceed the scope of the State’s discretion under the Act
and violate federal standards. As AB 5 is causing injury to
one or more of the plaintiffs and the other requirements of
Article III standing are met, no more is required to allow this
suit to go forward.

   We express no opinion on the merits of ILC’s preemption
claim. Rather, we simply reaffirm over a century’s worth of
precedent and hold that ILC maintains a valid cause of action
under the Supremacy Clause to assert such a claim for injunc-
tive relief. The district court’s opinion is therefore
REVERSED and REMANDED for further proceedings con-
sistent with this opinion.