State of California v. U.S. Department of Homeland Security

Background

The State of California, Maine, Oregon, the Commonwealth of Pennsylvania, and the District of Columbia challenged the Department of Homeland Security’s final rule, “Inadmissibility on Public Charge Grounds.” The rule changed how immigration officials evaluate whether a noncitizen seeking admission or adjustment of status is likely to become a public charge. The plaintiffs asserted six claims:

The defendants moved to dismiss. The court had previously issued a preliminary injunction against applying the rule in specified locations, but the Ninth Circuit stayed that injunction. The rule therefore took effect on February 24, 2020.

Standing, Ripeness, and Zone of Interests

The court denied the motion to dismiss based on standing. It relied on the plaintiffs’ allegations and evidence that the rule would cause some people to withdraw from, or avoid enrolling in, federal health programs including Medicaid. The court found that this could reduce federal reimbursements to states and increase states’ uncompensated healthcare costs. The court also relied on the Department of Homeland Security’s own analysis, which projected reductions in enrollment and federal payments.

The court denied the motion based on ripeness. It found that the challenge presented a concrete legal question about whether the Department of Homeland Security properly interpreted and implemented the Immigration and Nationality Act. The rule was final agency action, and the alleged effects on individuals and states were not too speculative to permit review.

The court also denied the motion based on the zone-of-interests test. That test asks whether the plaintiffs’ interests are among those protected or arguably protected by the statute being invoked. The court concluded that the plaintiffs’ financial interests were sufficiently related to the immigration statutes, including the statute allowing states to seek reimbursement under certain affidavits of support.

First and Fourth Claims: Contrary to Law and Arbitrary and Capricious

The court deferred ruling on the motion to dismiss the first and fourth claims. Those claims challenged the rule as contrary to the Immigration and Nationality Act and as arbitrary and capricious under the Administrative Procedure Act.

The court had previously found that the plaintiffs were likely to succeed on those claims at the preliminary-injunction stage. The Ninth Circuit’s later decision staying the injunction reached different conclusions about the rule’s interpretation of “public charge” and about the agency’s consideration of costs and public-health effects. Because the Ninth Circuit merits panel had not yet issued its decision, the court determined that ruling immediately could be premature. The court therefore deferred ruling on these claims until the Ninth Circuit issued an opinion on the preliminary injunction or otherwise disposed of the matter.

Second Claim: Rehabilitation Act

The court granted the motion to dismiss the second claim, which alleged that the rule violated the Rehabilitation Act through the Administrative Procedure Act. The court explained that Section 504 of the Rehabilitation Act requires a plaintiff to show, among other things, that a person was denied a benefit solely because of a disability.

The court concluded that the rule did not deny admission or adjustment of status solely because of disability. The rule applied the same public-charge inquiry to people with and without disabilities, and disability was only one possible factor in the totality-of-the-circumstances analysis. The court also reasoned that the Immigration and Nationality Act specifically requires immigration officers to consider health, including disability-related circumstances, when making public-charge determinations. The dismissal was without leave to amend because the court found that further factual allegations could not change its conclusion.

Third Claim: State Healthcare Discretion

The court granted the motion to dismiss the third claim, which alleged that the rule unlawfully interfered with states’ discretion under federal healthcare and public-benefit statutes. The plaintiffs argued that the rule’s chilling effects would cause people to avoid benefits and would effectively deprive states of options to provide benefits to certain children, pregnant women, and noncitizens.

The court held that the cited statutes gave states permission, rather than a requirement, to offer or extend the benefits. It further held that the rule did not prevent states from offering those programs. Although individuals might decide not to use available benefits because of the rule, that possible effect did not eliminate the states’ authority to provide them. The court dismissed this claim without leave to amend because it found that additional factual allegations could not alter the legal conclusion.

Fifth Claim: Equal Protection Based on Race

The court granted the motion to dismiss the fifth claim, but allowed amendment. The claim alleged that the rule violated the equal-protection component of the Fifth Amendment because it was motivated by racial or ethnic discrimination.

The court declined to apply the especially deferential standard associated with immigration cases involving initial admission and exclusion because the rule also applied to people already in the United States seeking adjustment of status. Instead, it applied the framework from Arlington Heights, under which discriminatory intent may be shown through direct or circumstantial evidence, including disparate impact, historical background, departures from normal procedures, and statements by decisionmakers.

The court found that the plaintiffs plausibly alleged that the rule could affect some racial groups more heavily than others. But it concluded that the alleged statements by the President and other officials were largely remote or unrelated to the rule, and that the allegations about speeding up the rulemaking process did not sufficiently suggest discriminatory intent. The court dismissed the claim with leave to amend because the plaintiffs could allege additional facts.

Sixth Claim: Unconstitutional Animus

The court granted the motion to dismiss the sixth claim and dismissed it without leave to amend. The court understood the claim to challenge the rule under a more searching form of rational-basis review based on an alleged intent to harm a politically unpopular group.

The court identified two problems. First, the group identified by the plaintiffs—non-White, non-European immigrants—was defined by race and ethnicity, which the court treated as a traditionally suspect classification rather than a non-suspect politically unpopular group eligible for the proposed form of review. Second, the sixth claim relied on the same facts and sought the same relief as the fifth claim. The court therefore found it entirely duplicative of the fifth claim and did not allow amendment.

Disposition

The court denied the defendants’ motion to dismiss as to standing, ripeness, and the zone-of-interests challenge. It granted the motion to dismiss the second claim and dismissed that claim without leave to amend. It granted the motion to dismiss the third claim and dismissed it without leave to amend. It granted the motion to dismiss the fifth claim and dismissed it with leave to amend. It granted the motion to dismiss the sixth claim and dismissed it without leave to amend. The court deferred ruling on the motion to dismiss the first and fourth claims. Judge Phyllis J. Hamilton signed the order.