United States District Court, E.D. Tennessee, Greeneville
TRI-CITIES HOLDINGS LLC, JANE DOE NOS. 1-2, and JOHN DOE NOS. 1-6, Plaintiffs,
TENNESSEE HEALTH SERVICES AND DEVELOPMENT AGENCY; CITY OF JOHNSON CITY, TENNESSEE; JOHNSON CITY BOARD OF COMMISSIONERS; JOHNSON CITY BOARD OF ZONING APPEALS; MELANIE M. HILL, in her official capacity as Executive Director of the Tennessee Health Services & Development Agency; and KEITH GAITHER, ELISHA HODGE, LISA JORDAN, D. LYNN JOHNSON, JAMES L. WRIGHT, CHARLOTTE C. BURNS, CLAUDIA H. BYRD, ROBERT S. DOOLITTLE, MARK D. FLORA, M.D., BARRETT G. HAIK, MD, FACS, and THOM MILLS, in their official capacities as members of the Board of the Tennessee Health Services & Development Agency, Defendants.
MEMORANDUM OPINION AND ORDER
RONNIE GREER UNITED STATES DISTRICT JUDGE.
before the Court are three motions: (1) Plaintiffs'
motion for partial summary judgment, [Doc. 212]; responses,
[Docs. 228, 231]; amended motion for summary judgment
(withdrawing requests for relief), [Doc. 233]; replies, [Docs.
236, 237]; (2) Defendant Johnson City's motion for
summary judgment, [Doc. 215]; response, [Doc. 222]; reply,
[Doc. 239]; and (3) the motion of the State
Defendants for summary judgment on Counts 8, 10, and
of plaintiffs' second amended complaint, [Doc. 218];
response, [Doc. 223]; reply, [Doc. 240]. For the reasons
which follow, plaintiffs' motion for summary judgment
will be DENIED, Johnson City's motion for summary
judgment will be GRANTED, the State Defendants' motion
for summary judgment will be GRANTED, and plaintiffs'
complaint will be DISMISSED.
suit before the Court, No. 2:13-CV-305, is the second of
three lawsuits filed by Tri-Cities Holding, LLC
(“TCH”) and various Jane and John Does (the
“individual defendants”) (referred to
collectively as “plaintiffs”) related to
TCH's efforts to open an opioid treatment program (OTP)
in Johnson City, Tennessee. In its first complaint, in case
No. 2:13-CV-108, filed April 19, 2013 (TCH I), TCH,
a Georgia limited liability company which proposed to
establish an out-patient methadone maintenance treatment
service, or OTP, in Johnson City, Tennessee, and eight
prospective patients of TCH, Jane Does 1-2 and John Does 1-6,
sued Johnson City seeking declaratory and injunctive relief
under § 504 of the Rehabilitation Act of 1973, 29 U.S.C.
§ 793 (the “Rehabilitation Act”) and the
Americans with Disabilities Act, 42 U.S.C. § 12101,
et seq. (“ADA”). More specifically, the
plaintiffs alleged that Johnson City's zoning ordinance
relating to methadone clinics was facially invalid and that
Johnson City's actions in denying TCH occupancy and
operation permits to operate TCH's proposed OTP were in
violation of the Rehabilitation Act and the ADA. Plaintiffs
sought a preliminary injunction, but the Court subsequently
ordered plaintiffs to show cause why the request for
injunction was “not premature inasmuch as the
plaintiff, Tri-Cities Holdings, LLC, has no Certificate of
Need from the Tennessee Health Services and Development
Agency or license from the Tennessee Department of
Health.” [Doc. 10, No. 2:13-CV-108]. On June 12, 2013,
the Court held that plaintiffs' claims were not ripe for
disposition and dismissed the case without prejudice.
plaintiffs did not appeal the Court's judgment in TCH
I, and it has now become final. Instead, they filed the
instant action on July 8, 2013, in the United States District
Court for the Middle District of Tennessee (TCH II).
[Doc. 1]. On November 13, 2013, the case was transferred from
the Middle District to this Court. [Doc. 95]. Plaintiffs have
once again sued Johnson City, and have added the State
Defendants,  again claiming violation of the
Rehabilitation Act and the ADA. On April 10, 2014, this Court
granted in part and denied in part HSDA's motion to
dismiss and dismissed plaintiffs' claims under the
Rehabilitation Act and their state law claims. [Doc. 163]. Also
on April 10, 2014, the Court granted the motion of Johnson
City to stay the case and denied plaintiffs' motion for
summary judgment and for a preliminary injunction without
prejudice to their renewal after the lifting of the stay,
[Doc. 164]. Plaintiffs appealed the Court's orders to the
Sixth Circuit Court of Appeals, [Doc. 166]. The Sixth Circuit
affirmed the denial of the preliminary injunction and
dismissed the appeal of the denial of summary judgment and
dismissal of the state law claims for lack of jurisdiction,
[Doc. 172]. Plaintiffs were ordered to file periodic status
reports with the Court on the status of the administrative
appeal of the denial of their Certificate of Need
(“CON”) application by HSDA. [Docs. 175, 181,
184-190, 198, 199]. On August 22, 2016, TCH moved to lift the
stay, [Doc. 193], and the Court granted the motion on October
21, 2016, [Doc. 205]. The motions currently pending before
the Court were then filed.
third lawsuit, No. 2:14-CV-233, was filed by TCH on May 19,
2014, and alleges violations of the Rehabilitation Act and
the ADA by the state administrative law judge assigned to the
appeal of HSDA's denial of TCH's CON, the Tennessee
Department of State and its Secretary, and the Tennessee
Department of Mental Health & Substance Abuse Services
and its Commissioner. The Johnson City defendants are not
parties to that suit. The third lawsuit was dismissed by the
Court on May 31, 2017. The appeal of the dismissal is pending in
the Sixth Circuit.
Standard of Review
judgment is proper where the pleadings, the discovery and
disclosure materials on file, and any affidavits show there
is no genuine issue of material fact and that the movant is
entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c).
In ruling on a motion for summary judgment, the Court must
view the facts contained in the record and all inferences
that can be drawn from those facts in the light most
favorable to the non-moving party. Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587
(1986); Nat'l Satellite Sports, Inc. v. Eliadis,
Inc., 253 F.3d 900, 907 (6th Cir. 2001). The
Court cannot weigh the evidence, judge the credibility of
witnesses, or determine the truth of any matter in dispute.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249
moving party bears the initial burden of demonstrating that
no genuine issue of material fact exists. Celotex Corp.
v. Catrett, 477 U.S. 317, 323 (1986). To refute such a
showing, the non-moving party must present some significant,
probative evidence indicating the necessity of a trial for
resolving a material factual dispute. Id. at 322. A
mere scintilla of evidence is not enough. Anderson,
477 U.S. at 252; McClain v. Ontario, Ltd., 244 F.3d
797, 800 (6th Cir. 2000). This Court's role is
limited to determining whether the case contains sufficient
evidence from which a jury could reasonably find for the
non-moving party. Anderson, 477 U.S. at 248-49;
Nat'l Satellite Sports, 253 F.3d at 907. If the
non-moving party fails to make a sufficient showing on an
essential element of its case with respect to which it has
the burden of proof, the moving party is entitled to summary
judgment. Celotex, 477 U.S. at 323. If this Court
concludes that a fair-minded jury could not return a verdict
in favor of the non-moving party based on the evidence
presented, it may enter a summary judgment.
Anderson, 477 U.S. at 251-52; Lansing Dairy,
Inc. v. Espy, 39 F.3d 1339, 1347 (6th Cir.
party opposing a Rule 56 motion may not simply rest on the
mere allegations or denials contained in the party's
pleadings. Anderson, 477 U.S. at 256. Instead, an
opposing party must affirmatively present competent evidence
sufficient to establish a genuine issue of material fact
necessitating the trial of that issue. Id. Merely
alleging that a factual dispute exists cannot defeat a
properly supported motion for summary judgment. Id.
A genuine issue for trial is not established by evidence that
is merely colorable, or by factual disputes that are
irrelevant or unnecessary. Id. at 248-52.
have moved for summary judgment on Counts 1 through 6 of the
second amended complaint, all of which make claims against
the Johnson City defendants. The Johnson City defendants have
responded and moved for summary judgment on the same basis
upon which they have responded to the plaintiffs' motion.
Plaintiffs then respond to the motion of the Johnson City
defendants on the same basis raised in their motion. The same
is true for the State Defendants. Plaintiffs move for summary
judgment as to Counts 8, 10 and 12 of the second amended
complaint, all of which allege illegal discrimination by the
State Defendants, i.e., HSDA's illegal discrimination
against plaintiffs in violation of the ADA (Counts 8 and 10),
and HSDA's failure to provide plaintiffs with a
reasonable accommodation in violation of the ADA (Count 12).
Plaintiffs have submitted the declaration of Steve Kester,
[Doc. 46], Dr. David Lentz, [Doc. 49], Dr. Robert J. Newman,
[Doc. 47], Jane Does 1-2, [Docs. 48-50], and John Does 1-6,
[Docs. 42-56]. The State defendants likewise have responded
to plaintiffs' motion and filed a cross-motion for
summary judgment. The Court will, for the sake of clarity,
consider the issues as they relate to the Johnson City
defendants first and then will consider the claims which
relate to the State Defendants.
Claims Against Johnson City
City responds to plaintiffs' motion for partial summary
judgment by invoking the doctrines of ripeness, issue
preclusion, standing and/or mootness as a bar to
plaintiffs' claims, and, in turn, seeks summary judgment
on the same grounds. Plaintiffs address the issue of ripeness
in one paragraph of their 25-page opening memorandum in
support of their motion, [Doc. 213], one paragraph in their
30-page reply brief, [Doc. 236], and in four pages of their
30-page response to Johnson City's motion for summary
judgment, [Doc. 222]. Johnson City argues that all of
plaintiffs' claims against Johnson City are barred by
ripeness/issue preclusion and, because this issue is
completely dispositive of plaintiffs' claims, the Court
will address it first.
prior action, TCH I, the Court dismissed the
complaint without prejudice because the “'issues
[were] not ripe for disposition'” since TCH
“had not obtained, and might never obtain, the
[required] CON and license from the State of
Tennessee.” [See Doc. 163 at 2, No.
2:13-CV-108]. This Court previously stayed this case and
denied plaintiffs' motion for a preliminary injunction,
stating in its April 10, 2014 memorandum that:
This is the second suit on the same claims filed by
plaintiffs against the City of Johnson City, Johnson City
Board of Commissioners, and the Johnson City Board of Zoning
Appeals (the “Johnson City defendants”). The
instant suit also adds as a party defendant the Tennessee
Health Services and Development Agency (“HSDA”),
and the Executive Director and members of the Board of HSDA.
The first suit was filed in this Court on April 19, 2013 (No.
2:13-CV-108). After a hearing on plaintiffs' motion for a
preliminary injunction, the Court dismissed the complaint
because the “issues [were] not ripe for disposition,
” [Doc. 45, No. 2:13-CV-108], for reason that
Tri-Cities Holdings, LLC (“TCH”), had not
obtained, and might never obtain, the required Certificate of
Need (“CON”) or license from the State of
Plaintiffs' complaint was dismissed without prejudice and
the Court provided that plaintiffs would be permitted to
reopen the case by motion upon a showing of ripeness rather
than requiring the filing of a new complaint. [Id.
at 10, fn. 7]. Judgment was entered by the Clerk on June 12,
2013, [Doc. 46, No. 2:13-CV-108], and the judgment became
final thirty (30) days after the date of filing of the
judgment since no notice of appeal was filed. See
Fed. R. App. P. 4. No motion has ever been filed to reopen
the case upon a showing of ripeness. Instead, plaintiffs
filed the instant action in the Middle District of Tennessee
on July 8, 2013. The Johnson City defendants filed a motion
for change of venue and the Court ultimately transferred the
case to this district. The case was opened here on November
The Johnson City defendants moved to dismiss on the bases of
issue preclusion and lack of ripeness, [Doc. 87]. Because the
issue of ripeness has been previously litigated adversely to
plaintiffs and because they did not appeal the prior
judgment, the Johnson City defendants argue that the doctrine
of issue preclusion bars the plaintiffs from relitigating
that issue in this Court (or from seeking a different answer
from a different federal court). Plaintiffs respond that the
Court's prior judgment was without prejudice, does not
operate as an adjudication on the merits, and thus does not
have any res judicata effect. Plaintiffs argue that
a plaintiff always has the right to refile a complaint
dismissed without prejudice.
The Johnson City defendants subsequently moved for a stay of
these proceedings “until there is a resolution of
whether Tri-Cities Holdings is entitled to a Certificate of
Need and a license, ” [Doc. 98], asserting that a stay
is more appropriate than another dismissal without prejudice
at this point to avoid the possibility that plaintiffs will
simply refile their complaint in some other federal judicial
district. Plaintiffs respond, arguing that the case is ripe
for adjudication and that the administrative appeal of the
denial of their CON application is irrelevant to their ADA
claims. In essence, plaintiffs argue that the Court's
prior determination that plaintiffs' claims against the
Johnson City defendants are not ripe for determination until
TCH has obtained the required CON and license from the State
of Tennessee is erroneous. Although the Magistrate Judge
previously ordered a stay of discovery, the pending motion to
stay the case was deferred by the Magistrate Judge to this
Res judicata, i.e., the preclusive effect given a
judgment, consists of two conceptually different
doctrines--claim preclusion and issue preclusion. Stryker
v. National Union Fire Insurance Co., 681 F.3d 819, 824
(6th Cir. 2012) (citing Taylor v. Sturgell, 553 U.S.
880, 892 (2008)). “Under the doctrine of claim
preclusion, a final judgment forecloses ‘successive
litigation of the very same claim, whether or not
relitigation of the claim raises the very same issue as the
earlier suit.'” Id. (quoting New
Hampshire v. Maine, 532 U.S. 742, 748 (2001)).
“Issue preclusion, in contrast, bars ‘successive
litigation of an issue of fact or law actually litigated and
resolved in a valid court determination essential to the
prior judgment, ' even if the issue recurs in the context
of a different claim.” Id. (quoting New
Hampshire, 532 U.S. at 748-49).
In order for issue preclusion to apply to the prior ruling,
the party seeking estoppel must show:
(1) the precise issue raised in the present case must have
been raised and actually litigated in the prior proceeding;
(2) determination of the issue must have been necessary to
the outcome of the prior proceeding; (3) the prior proceeding
must have resulted in a final judgment on the merits; and (4)
the party against whom estoppel is sought must have had a
full and fair opportunity to litigate the issue in the prior
Stryker, 601 F.3d at 825 (quoting Pfeil v. St.
Bank & Trust Co., 671 F.3d 585, 601 (6th Cir. 2012)
(internal quotation marks and citations omitted).
Plaintiffs argue only that the Court's prior judgment was
without prejudice and therefore does not have any preclusive
effect. Plaintiffs' argument, however, completely misses
the point. Plaintiffs are not barred from refiling their
complaint, nor are they precluded from ultimately pursuing
any of their claims against the Johnson City defendants. The
Johnson City defendants argue only that the issue of ripeness
has been conclusively decided in the prior litigation between
plaintiffs and the Johnson City defendants and, that issue
having been conclusively decided, plaintiffs may not proceed
with their claims until they have shown that the claims are
ripe for adjudication. Upon examination of the relevant
factors, the Court agrees with the Johnson City defendants.
First, the precise issue now raised, i.e., ripeness, was
actually raised and actually litigated in the prior
proceeding. Plaintiffs' argument that the issue was
erroneously decided by the Court in the prior proceeding is
beside the point. Plaintiffs did not seek reconsideration of
the Court's ruling nor did they appeal. The Court entered
judgment and the judgment became final and binding on the
plaintiffs. It has now been conclusively established that the
case is not ripe for determination and the Court lacks
subject matter jurisdiction until plaintiffs obtain the
necessary CON and license. The issue cannot be relitigated by
plaintiffs in this or any other action in federal court. To
the extent plaintiffs believed the Court's ruling on the
issue was incorrect, they should have appealed the judgment.
They did not. They instead chose to attempt to relitigate the
issue in the Middle District of Tennessee. Likewise,
plaintiffs' argument that they have discovered precedents
which they did not previously call to the Court's
attention are similarly unavailing.
Second, the determination of the ripeness issue was clearly
necessary to the outcome of the prior proceeding. Indeed, it
was the sole basis for the Court's prior determination.
Judgment was entered on that very issue. The second
requirement for issue preclusion is met.
Third, the prior proceeding resulted in a judgment on the
merits, notwithstanding that none of the plaintiffs'
claims were decided on the merits. Plaintiffs appear to argue
that this prerequisite has not been met because the
Court's dismissal of the complaint was without prejudice.
That is not the proper inquiry in deciding whether issue
preclusion applies to this proceeding. The inquiry is whether
the issue for which preclusion is sought was decided and a
judgment on the merits entered on that issue. See, e.g.,
Sandy Lake Band of Mississippi Chippewa v. United
States, 714 F.3d 1098 (8th Cir. 2013) (dismissal without
prejudice for lack of subject matter jurisdiction meets
requirement because “[a]lthough dismissal for lack of
subject matter jurisdiction does not adjudicate the merits of
the claims asserted, it does adjudicate the court's
jurisdiction.”) (citing Kulinski v. Medtronic
Bio-Medicus, Inc., 112 F.3d 368, 373 (8th Cir. 1997)
(holding that the complaint's dismissal without prejudice
for lack of subject matter jurisdiction would preclude
plaintiff from bringing another claim on the same
jurisdictional basis)). In other words, plaintiffs may
reassert the claims in their first lawsuit against the
Johnson City defendants, but only after they establish that
the claims are ripe for adjudication, i.e., only after they
obtain the required CON and license.
Finally, plaintiffs had a full and fair opportunity to
litigate the ripeness issue in the prior proceeding. On April
25, 2013, the Court ordered plaintiffs to show cause why the
proceeding was not “premature inasmuch as the
plaintiff, Tri-Cities Holding, LLC, has no Certificate of
Need from the Tennessee Health Services and Development
Agency or license from the Tennessee Department of
Health.” [Doc. 10, No. 2:13-CV-108]. Plaintiffs
responded to the order on May 1, 2013, in a 17 page brief
which specifically addressed whether “Plaintiffs'
claims are ripe for adjudication.” [Doc. 14, No.
2:13-CV-108, at 3]. The Court heard oral argument on May 10,
2013, after giving notice of a hearing on the issue of
whether the motion for preliminary injunction was premature.
[See Notice, No. 2:13-CV-108, May 6, 2013]. Indeed,
plaintiffs make absolutely no suggestion that they did not
have a full and fair opportunity to litigate the ripeness
issue in the prior proceeding.
This Court has previously determined, in the prior litigation
between these parties, that plaintiffs' claims against
the Johnson City defendants are not ripe for adjudication
because they do not have, and may never have, a CON or a
license to operate their proposed methadone clinic, even if
the Court were to declare the Johnson City Zoning Ordinance
invalid. The Court's prior judgment on the issue of
ripeness has become final. Plaintiff, TCH, still does not
have the required CON and license. Because the prerequisites
for issue preclusion on this issue are met, plaintiffs are
bound by the Court's prior ruling on the issue.
Defendants' motion to stay will, therefore, be GRANTED,
[Doc. 98]. The Johnson City defendants motion to dismiss,
[Doc. 87], and plaintiffs' motion to lift stay on
discovery and for decision on plaintiffs' motions for a
preliminary injunction and for partial summary judgment,
[Docs. 153, 154], will be DENIED. Plaintiffs' motion for
a preliminary injunction, [Doc. 82], and plaintiffs'
motion for summary judgment, [Doc. 127], are DENIED WITHOUT
PREJUDICE and may be renewed, if appropriate, once the stay
in this case is lifted.
[Doc. 164 at 2-7].
noted above, plaintiffs largely ignore the ripeness/issue
preclusion problem they face. They apparently believe the
Court's prior ruling was wrong and once again argue that
challenges to facially invalid laws or ordinances are
“ripe by their very nature, ” quoting Ecogen,
LLC v. Town of Italy, 438 F.Supp.2d 149, 155 (W.D.N.Y.
2006) and citing MacDonald v. Safir, 206 F.3d 183,
189 (2d Cir. 2000). As Johnson City notes, however, that
argument was rejected and these cases distinguished by the
Sixth Circuit in its order on plaintiffs' interlocutory
appeal of this Court's denial of a preliminary
injunction. The Sixth Circuit sated:
(1) Likelihood of success on the merits. The
district court did not address the merits of Plaintiffs'
discrimination claims, concluding they were not ripe.
Plaintiffs have not shown any error in that conclusion.
Ripeness is a threshold determination. The district court
considered three factors in finding that Plaintiffs'
claims were not ripe: (1) the likelihood that the harm
alleged will ever come to pass; (2) the hardship resulting if
judicial relief is denied at that point; and (3) whether the
factual record was sufficiently developed to produce a fair
adjudication of the merits. The court found that none of
these factors was satisfied.
Plaintiffs argue that facial challenges to invalid laws are
“always ripe by their very nature.”
(Appellants' Brief at 28) They cite Ecogen, LLC v.
Town of Italy, 438 F.Supp.2d 149, 155 (W.D.N.Y.2006),
and MacDonald v. Safir, 206 F.3d 183, 189 (2d
Cir.2000). These cases are factually distinguishable. In
Ecogen, the plaintiff alleged that a township's
moratorium on construction of wind turbines violated its
substantive due process and equal protection rights. Prior to
the moratorium, plaintiff purchased property and acquired
easements for its planned wind facilities. When the project
was publicly announced, the town passed a six-month
moratorium on wind turbines, stating it needed time to
consider and adopt a master zoning plan. The town repeatedly
renewed the moratorium but failed to adopt a master plan.
Plaintiff did not require any state or local permits to
proceed with its project, and the district court found the
plaintiff's facial challenge to the moratorium ordinance
was ripe. Tri-Cities is not in a comparable position: it
concedes it cannot open a methadone clinic without a CON and
a license from the state.
MacDonald v. Safir, 206 F.3d 183 (2d Cir.2000),
involved a First Amendment challenge to New York City's
parade permit regulations. The Second Circuit held that a
facial challenge is proper “... whenever a licensing
law gives a government official or agency substantial power
to discriminate based on the content or viewpoint of speech
...”. Id. at 189, citing City of Lakewood
v. Plain Dealer Publishing Co., 486 U.S. 750, 108 S.Ct.
2138, 100 L.Ed.2d 771 (1988). Plaintiffs' supplemental
authorities are similarly distinguishable, as they involve
facial challenges to zoning ordinances that infringe First
Amendment rights of speech and free expression. Plaintiffs
are not raising First Amendment claims. And they cite no
authority suggesting that the ripeness doctrine should be
similarly relaxed or excused when an ordinance or statute is
challenged under the ADA or the Rehabilitation Act.
Plaintiffs also contend that their claims are ripe because
they face a “Catch 22” dilemma that requires
immediate judicial relief. They argue that they must show
their compliance with local laws in order to obtain a CON
from HSDA. They also cite the Johnson City zoning
ordinance's requirement that Tri-Cities obtain a CON in
order to obtain a special exception approval under that
ordinance. This potential “Catch 22” was
mentioned several times during the Board of Zoning
Appeals' hearing on Tri-Cities's application. Mr.
Neilson, Johnson City's Traffic Engineer, summarized
Tri-Cities's application at the start of the hearing, and
reviewed the requirements of Section 613.3.3 of the
City's zoning code governing methadone treatment clinics.
Neilson stated that one of the code's requirements is
that the clinic be fully licensed and certified by the state,
and a CON obtained from HSDA, prior to BZA approval. Mr.
Neilson stated that if the Board chose to grant the two
waivers sought by Tri-Cities (permission to open at 5 a.m.,
and a location that was not an arterial street), the approval
“should be conditioned upon granting-that the State
grants them the certificate of need. Since they can't get
their certificate of need prior to BZA approval, it's
kind of a catch-22, so you'll probably see an amendment
to that code in the future.” Mr. Neilson also opined
that the Board lacked legal authority to grant a variance or
exception to the conditions of the zoning ordinance regarding
hours of operation and arterial street location.
Mr. Herrin, counsel for Johnson City, also spoke at the
hearing. He opined that the Board did not have legal
authority to overrule the criteria adopted by the City
Commission in the zoning code. The City's position was
that two of those criteria (arterial street and hours of
operation) were not satisfied. Mr. Herrin agreed with Neilson
that the Board should not consider the fact that Tri- Cities
did not have an approved CON, as that would amount to a
“Catch-22.” He urged the Board not to consider
that issue in reaching its decision regarding the other two
criteria. At the close of the hearing, a Board member made a
formal motion to deny Tri-Cities's request, stating that
the “... hours of operation and the location having
access from an arterial street are not met. The way that the
board has acted on special exceptions ... in the past when a
special exception request comes before us, if it meets all
the conditions we have no choice but to approve that special
exception. This does not meet all those conditions and based
on that fact, I move that we deny the request.” The
record before us does not reasonably support an argument that
the Board denied Tri-Cities's zoning application because
it lacked a CON.
Plaintiffs also contend that they faced this
“Catch-22” dilemma before HSDA, and suggest that
HSDA denied a CON because Tri-Cities lacked a zoning permit,
and because of Johnson City officials' opposition to
their proposal. Plaintiffs cite the opening remarks of Mr.
Christoffersen, HSDA's general counsel, at the HSDA
hearing. Christoffersen reported that the federal district
court had essentially postponed a decision on Plaintiffs'
lawsuit challenging the Johnson City ordinance, and he urged
the members to set aside any consideration of local zoning.
He specifically recommended that the panel focus its
discussions on the three main criteria for issuing a CON: the
demonstrated need for the facility; the proposal's
economic feasibility; and its contribution to the orderly
development of healthcare in Tennessee. Christofferson told
the panel: “I would recommend and urge that the
decision not be based on zoning itself today, because it
hasn't been definitely determined to be a roadblock, and,
therefore, that the [other] criteria be looked at rather than
that.” At oral argument, Plaintiffs' counsel
dismissed these statements as “tongue in cheek”
subterfuge that should be interpreted as urging the panel to
deny a CON because of local opposition. We cannot agree with
counsel's characterization. Given the entirety of the
hearing testimony and the questions posed by the panel
members, there is no reason to suspect that the panel did not
follow Mr. Christofferson's advice.
Plaintiffs' counsel also cited a statement by a
“lobbyist” for Johnson City, who appeared at the
HSDA hearing and spoke in opposition to Tri-Cities's
application. This “lobbyist” (Mr. Taylor)
summarized the City's position that Tri-Cities had not
established a need for its proposed clinic. He cited the
physician-to-patient ratio for area physicians approved to
dispense buprenorphine (an alternative to methadone for
treating opiate addiction), a ratio that is apparently more
favorable than in other more populous areas of the state. He
also critiqued Tri-Cities's economic model for its clinic
operations. Johnson City's mayor, who is a practicing
oral surgeon, also spoke. He described other addiction
treatment services currently available in Johnson City, and
questioned Tri- Cities's contention that it had shown a
need for the clinic. Other questions were raised at the
hearing by other speakers and HSDA members about operations
at Tri-Cities's other methadone clinics, the adequacy of
proposed staffing levels, and the extent of education that
would be required for clinic staff. Also, prior to the
hearing, HSDA's staff had reviewed Tri-Cities's
application and concluded they could not support it
“... because the majority of the Criteria and Standards
for the type of facility being proposed in the application
have not been met ...”. Plaintiffs concede that HSDA
has issued CON's for 12 other methadone clinics in
Tennessee, so this staff recommendation cannot simply be
attributed to local opposition or lack of zoning approval,
much less bias against opiate-addicted individuals. It is
clear that HSDA was aware of local opposition to
Tri-Cities's proposal. But we cannot agree that HSDA
denied a CON because of that opposition, or because Tri-
Cities lacked a zoning variance. As the district court
accurately stated, Tenn Code Ann. § 68-11-1624
specifically states that local support or opposition to a
methadone maintenance clinic's CON application is
informational and advisory only, and is not a prerequisite to
obtaining a CON.
These facts strongly support a conclusion that Plaintiffs
cannot show a substantial likelihood of success on the merits
of their assertion that their claims are ripe. If
Tri-Cities's state administrative appeal is ultimately
unsuccessful, it cannot open its clinic. And until that
appeals process is complete, the district court cannot
reasonably determine if Tri-Cities was denied a CON due to
some Catch 22 dilemma, or whether the denial was based on
issues having nothing to do with Johnson City's zoning
ordinance or disability discrimination. We are confident that
the district court can address the ramifications of any
“Catch-22” dilemma that might appear in the
record when Plaintiffs can demonstrate that their claims are
Tri-Cities Holdings, LLC v. Tennessee Health Services
& Development Agency, 598 F. App'x 404, 408-11