Family Equality v. Azar

Background

In 2016, the Department of Health and Human Services adopted a rule stating that people otherwise eligible for HHS programs and services could not be excluded, denied benefits, or subjected to discrimination based on factors including disability, sex, race, religion, gender identity, or sexual orientation. In November 2019, HHS issued a Notice of Non-Enforcement stating that it would no longer enforce certain provisions of that rule.

Family Equality, True Colors United, and Services & Advocacy for GLBT Elders, referred to collectively as the plaintiffs, sued under the Administrative Procedure Act. They alleged that the Notice of Non-Enforcement was a binding substantive rule issued without the required notice-and-comment procedures and was arbitrary and capricious. The defendants moved to dismiss, arguing that the plaintiffs lacked constitutional standing and were outside the relevant statute or regulation’s zone of interests. Xavier Becerra was automatically substituted for Alex Azar II as the HHS Secretary during the case.

Standing requirement

The court addressed only whether the plaintiffs had standing. Article III standing requires a plaintiff to show an injury in fact that is concrete and particularized, fairly traceable to the challenged conduct, and likely to be redressed by a favorable decision. An organization may establish standing through an injury to its own activities, including a perceptible impairment of its established core activities or an involuntary diversion of resources.

Why the court found no standing

The plaintiffs alleged that the Notice of Non-Enforcement required them to spend staff time and resources responding to the change. True Colors United alleged that it spent 135 hours examining regulations in three states. Family Equality alleged that it spent approximately 40 hours assessing the Notice and more than 170 hours on related outreach and education. SAGE alleged that its team spent more than 20 hours designing a program concerning state-level protections, in addition to conducting outreach and education.

The court held that these allegations did not show an involuntary, material burden on established core activities. The plaintiffs continued their existing education, outreach, lobbying, and advocacy work. The court concluded that the additional activities were undertaken at the organizations’ own initiative in response to the Notice, rather than being an involuntary consequence that restricted their ability to carry out their established responsibilities. The court also rejected the argument that the Notice impeded the plaintiffs’ missions because they remained able to advocate against discrimination by HHS grant recipients.

Disposition

The court concluded that the plaintiffs had not established an injury in fact and therefore lacked Article III standing. Because standing was absent, the court lacked subject-matter jurisdiction and did not decide whether the plaintiffs fell within the relevant zone of interests. The court granted the defendants’ motion to dismiss and dismissed the case without prejudice. The Clerk was directed to terminate the motion and close the case.