FOR PUBLICATION UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT INDEPENDENT LIVING CENTER OF No. 15-56142 SOUTHERN CALIFORNIA, INC., a nonprofit corporation; GRAY D.C. No. PANTHERS OF SACRAMENTO, a 2:08-cv-03315- nonprofit corporation; GRAY CAS-MAN PANTHERS OF SAN FRANCISCO, a nonprofit corporation; GERALD SHAPIRO, Pharm. D., DBA Uptown Pharmacy and Gift Shoppe; SHARON STEEN, DBA Central Pharmacy; TRAN PHARMACY, INC.; MARK BECKWITH; MARGARET DOWLING, Petitioners-Appellants, v. JENNIFER KENT, Director of Department of Health Care Services of the State of California; DEPARTMENT OF HEALTH CARE SERVICES, Respondents-Appellees. 2 INDEP. LIVING CTR. V. KENT SACRAMENTO FAMILY MEDICAL No. 15-56154 CLINICS, INC.; ACACIA ADULT DAY SERVICES; RONALD B. MEAD, D.C. No. D.D.S.; THEODORE M. MAZER, M.D., 2:08-cv-03315- Intervenors-Appellants, CAS-MAN v. OPINION JENNIFER KENT, Director of Department of Health Care Services of the State of California; DEPARTMENT OF HEALTH CARE SERVICES, Respondents-Appellees. Appeal from the United States District Court for the Central District of California Christina A. Snyder, District Judge, Presiding Argued and Submitted September 26, 2018 Pasadena, California Filed November 21, 2018 Before: WILLIAM A. FLETCHER, MILAN D. SMITH, JR., and MORGAN CHRISTEN, Circuit Judges. Opinion by Judge Milan D. Smith, Jr.; Concurrence by Judge Christen INDEP. LIVING CTR. V. KENT 3 SUMMARY * Attorneys’ Fees The panel reversed the district court’s denial of plaintiffs’ request for attorneys’ fees following the settlement of litigation concerning California’s Assembly Bill X3 5, which reduced the Medi-Cal rate of reimbursement for healthcare providers by ten percent. Plaintiffs sought a writ of mandamus under Cal. Civ. Proc. Code § 1085 on the ground that AB 5 violated Section 30(A) of the Medicaid Act, thereby conflicting with federal law and violating the Supremacy Clause. The Ninth Circuit upheld the district court’s preliminary injunction against enforcement of the ten percent reduction, to apply both prospectively and retroactively. The Supreme Court vacated and remanded in light of the Centers for Medicare & Medicaid Services’ approval of certain plan amendments to implement AB 5. The parties subsequently entered into a settlement agreement in which plaintiffs reserved the right to move for attorneys’ fees. Plaintiffs did so pursuant to Cal. Civ. Proc. Code § 1021.5, and the district court denied their motions. The panel held that, even though the case was properly removed from state court based on federal question jurisdiction, plaintiffs brought a state-law claim and were therefore permitted to seek attorneys’ fees pursuant to § 1021.5. The panel concluded that plaintiffs’ § 1085 Writ * This summary constitutes no part of the opinion of the court. It has been prepared by court staff for the convenience of the reader. 4 INDEP. LIVING CTR. V. KENT was not a federal claim following Armstrong v. Exceptional Child Care Ctr., Inc., 135 S. Ct. 1378 (2015), which held that neither the federal Medicaid statute nor the Constitution provides a cause of action for enforcement of Section 30(A). The panel concluded that the § 1085 Writ endured as a state- law claim because, under California law, § 1085 Writs may issue to compel state ...
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