Azar v. United States

Background

Olga Azar brought a medical-negligence action against the United States under the Federal Tort Claims Act. She alleged that Dr. Yuan Da Fan negligently performed a supracervical abdominal hysterectomy on November 3, 2022, causing significant injuries.

At the time of the surgery, Dr. Fan was a part-time independent contractor with North East Medical Services, a federally qualified health center covered by the Federally Supported Health Centers Assistance Act. Those laws can allow certain state-law negligence claims against the United States for conduct by covered health-care entities, employees, or contractors acting within the scope of their employment or contracts.

Jurisdictional standard

The United States made a factual attack on subject-matter jurisdiction. In deciding that type of motion, the court may consider evidence outside the complaint and does not have to presume that the complaint’s allegations are true. The party invoking federal jurisdiction bears the burden of providing evidence sufficient to establish it.

The court explained that coverage under the Federally Supported Health Centers Assistance Act is limited to conduct related to the health center’s grant-supported activities and, for contractors, conduct within the scope of the contract. The terms of the contract—particularly billing and payment provisions—help determine whether the contractor acted within that scope. Because the waiver of the United States’ sovereign immunity must be narrowly construed, the court also narrowly construed the contract’s terms.

Court’s analysis

The contract required North East Medical Services to bill, collect, and retain payments from patients or third-party payors for Dr. Fan’s services. It also required Dr. Fan to invoice North East Medical Services monthly for care he provided.

The evidence showed that Dr. Fan did not bill North East Medical Services for Azar’s November 3, 2022 surgery. Instead, he billed through his private practice. The November invoice submitted by Dr. Fan to North East Medical Services did not seek payment for services performed on the surgery date. The court therefore found that the procedure fell outside the contract’s scope and outside the waiver of sovereign immunity provided by the Federal Tort Claims Act and extended by the Federally Supported Health Centers Assistance Act.

The court rejected Azar’s argument that her lack of knowledge about being Dr. Fan’s private patient, or any lack of knowledge by North East Medical Services or the government, changed the result. Those beliefs did not answer the factual question of whether Dr. Fan complied with the contract’s billing terms.

Azar also argued that the government should be prevented from challenging jurisdiction because it had previously told her that professional-negligence claims concerning the procedure had to be brought under the Federal Tort Claims Act. She said she relied on that statement by filing in federal court and that the limitations period for a state-court action had expired. The court stated that agreement, waiver, or estoppel cannot create federal subject-matter jurisdiction. It said any equitable-tolling arguments were more appropriately raised in state court if Azar filed such an action.

Disposition

Judge Rita F. Lin granted the government’s motion to dismiss for lack of subject-matter jurisdiction. Because the court lacked jurisdiction, it did not reach the merits of the alleged negligence or any requested relief, including prejudgment interest. The clerk was directed to close the case.