USA v. Florida Birth-Related Neurological Injury Compensation Association ( 2022 )

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[DO NOT PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 20-13448
____________________
UNITED STATES OF AMERICA,
VERONICA N. ARVEN, ESTATE OF THEODORE ARVEN, III
Plaintiffs-Appellees,
versus
FLORIDA BIRTH-RELATED NEUROLOGICAL INJURY
COMPENSATION ASSOCIATION,
THE FLORIDA BIRTH-RELATED NEUROLOGICAL INJURY
COMPENSATION PLAN,
Defendants-Appellants.
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2 Opinion of the Court 20-13448
____________________
Appeal from the United States District Court
for the Southern District of Florida
D.C. Docket No. 0:19-cv-61053-WPD
____________________
Before WILSON, ROSENBAUM, Circuit Judges, and COVINGTON,*
District Judge.
PER CURIAM:
In 1988, the Florida legislature found that obstetricians were
“high-risk medical specialists for whom malpractice insurance pre-
miums are very costly.” Fla. Stat. § 766.301(1)(a). So it created the
Florida Birth-Related Neurological Injury Compensation Associa-
tion (“Association”), which administers the Florida Birth-Related
Neurological Injury Compensation Plan (“Plan”) (together,
“NICA”). With NICA, the legislature established a no-fault system
of compensation “for a limited class of catastrophic injuries that re-
sult in unusually high costs for custodial care and rehabilitation.”
Id. § 766.301(2).
* The Honorable Virginia Covington, United States District Judge for the Mid-
dle District of Florida, sitting by designation.
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20-13448 Opinion of the Court 3
The Relators, Roni and Ted Arven, 1 sued NICA under the
False Claims Act (“FCA”) alleging that NICA violated federal law
by considering itself, rather than Medicaid, the payor of last resort.
As a result of NICA’s treatment of itself as the payor of last resort,
the Arvens asserted, Medicaid wound up having to pay more for
claims than it otherwise would have. NICA moved to dismiss. It
argued that it was not a “person” under the FCA and that it was
entitled to Eleventh Amendment immunity because NICA is an
arm of the state of Florida. The district court denied the motion,
concluding that NICA is not an arm of the state. We agree and
now affirm.
BACKGROUND
A. The Plan
Here’s how NICA works: obstetricians in Florida may
choose to belong to the Plan, which shields them from medical-
malpractice liability in covered circumstances. See Fla. Stat. §
766.314(4)(c). If they do, they pay to the Plan an initial “assess-
ment” and then an annual assessment every year after that. Id. §
766.314(4)(c), (5)(a). In addition, most licensed physicians in Flor-
ida—whether obstetricians or not—must pay a base assessment
1 Ted Arven died shortly before the Arvens filed their original complaint, so
his estate is a plaintiff in the litigation.
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and then an annual assessment every year thereafter. 2 Id. §
766.314(4)(b), (5)(a). And finally, licensed hospitals must pay as-
sessments per infant delivered in the hospital. Id. § 766.314(4)(a).
These assessments (and income generated from investing them)
primarily fund the Plan.
If a baby that a participating obstetrician delivers sustains a
“birth-related neurological injury,” 3 then the baby’s parents may
file with NICA a claim for compensation. Id. §§ 766.302(3);
766.305(1). The claim is exclusive of all other tort remedies. 4 An
administrative law judge (“ALJ”) determines whether compensa-
tion from the Plan is warranted. Id. § 766.304. Because entitlement
to compensation is on a no-fault basis, the claimant must show only
that (1) the infant sustained a birth-related neurological injury, and
2 Certain retired, government, and instructional and training physicians are
exempt. See Fla. Stat. § 766.314(4)(b)4.
3 A “birth-related neurological injury” is an “injury to the brain or spinal cord
of a live infant weighing at least 2,500 grams for a single gestation or, in the
case of a multiple gestation, a live infant weighing at least 2,000 grams at birth
caused by oxygen deprivation or mechanical injury occurring in the course of
labor, delivery, or resuscitation in the immediate postdelivery period in a hos-
pital, which renders the infant permanently and substantially mentally and
physically impaired. This definition shall apply to live births only and shall not
include disability or death caused by genetic or congenital abnormality.” Fla.
Stat. § 766.302(2).
4 The exception to this is “where there is clear and convincing evidence of bad
faith or malicious purpose or willful and wanton disregard of human rights,
safety, or property.” Fla. Stat. § 766.303(2). In that case, the parents may sue
as long as they do so before and instead of filing a claim with NICA. Id.USCA11 Case: 20-13448 Date Filed: 04/21/2022 Page: 5 of 21
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(2) obstetrical services were delivered at birth by a physician partic-
ipating in the Plan. Id. § 766.309(1)(a)–(b). Compensation includes
“[a]ctual expenses for medically necessary and reasonable medical
and hospital, habilitative and training, family residential or custo-
dial care, professional residential, and custodial care and service, for
medically necessary drugs, special equipment, and facilities, and for
related travel.” Id. § 766.31(1)(a).
When it created the Plan, the Florida legislature appropri-
ated $20 million from the Insurance Commissioner’s Regulatory
Trust Fund to fund the Plan. 1988 Fla. Sess. Law Serv. 88-1. Since
then, the Plan has been funded exclusively through the assessments
and investment income. The Plan is the actual pool of money that
pays claims. See Fla. Stat. § 766.302(8).
The Association, which administers the Plan, is “not a state
agency, board, or commission,” but may use the state seal. Id. §§
766.302(1), 766.315(1)(a). It consists of a board of seven directors.
Id. § 766.315. Florida’s Chief Financial Officer appoints the direc-
tors to staggered three-year terms. 5 Id. § 766.315(1)(b)–(c). The
Governor and the CFO both have the power to remove a director
“for misconduct, malfeasance, misfeasance, or neglect of duty in
office” only. Id. § 766.315(2)(c). Meetings of the Association are
subject to the Florida public-meetings laws, and the Office of
5 Florida’s Chief Financial Officer (CFO) is a constitutional officer elected in statewide
elections. Fla. Const. art IV, § 4.
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Insurance Regulation or the Joint Legislative Auditing Committee
may audit the Plan at any time. See id. § 766.315(5). 6
The Association may invest Plan funds, subject to certain
limitations. Id. § 766.315(5)(f). At the end of fiscal year 2019, the
Plan had about $1.346 billion in total assets, and its net position ac-
counting for liabilities was about $393 million. If the Plan funds
ever become “insufficient to maintain the plan on an actuarily
sound basis,” the Insurance Regulatory Trust Fund may transfer an
additional $20 million to the Association. Id. § 766.314(5)(b). All
“[f]unds held on behalf of the plan are funds of the State of Florida.”
Id. § 766.315(5)(f). A statutory provision waives sovereign immun-
ity for the Association “solely to the extent necessary to assure pay-
ment of compensation.” Id. § 766.303(3).
B. The Lawsuit
The Arvens are the parents of Cody Arven, a child who par-
ticipated in the Virginia Birth-Related Neurological Injury Com-
pensation Program, which was created shortly before Florida’s
NICA was created. The Arvens brought a qui tam against the Vir-
ginia program in 2015 after they discovered that that program
6 The CFO’s power to remove and the open-meetings-Act requirements were re-
cently added, through legislation signed into law June 21, 2021. The Arvens argue
that these changes should not be considered when determining whether NICA is an
arm of the state because they occurred after the actions at issue here. As we explain
below, even considering the changes, we conclude that NICA is not an arm of the
state, so we need not resolve the dispute over whether the changes should be consid-
ered.
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required its participants to submit healthcare claims to Medicaid
before submitting claims to the Virginia program. In 2018, Virginia
settled with the United States for about $20 million, of which the
Arvens received about $4 million.
Then, the Arvens brought the same suit against NICA in
April 2019. Their amended complaint alleges that NICA, like the
Virginia program, violated federal law by considering itself, rather
than Medicaid, the payor of last resort. The United States opted
not to intervene.
NICA moved to dismiss, arguing, among other things, that
NICA is an arm of the state, so it is not a “person” for FCA purposes
and is entitled to Eleventh Amendment immunity. Despite not in-
tervening, the government filed a “statement of interest” arguing
that NICA is not an arm of the state of Florida. After considering
full briefing on the motion and the government’s statement, the
district court denied the motion to dismiss. NICA appealed under
the collateral-order doctrine, which recognizes that the denial of a
claim of Eleventh Amendment immunity is immediately appeala-
ble. See P.R. Aqueduct & Sewer Auth. v. Metcalf & Eddy, Inc., 506
U.S. 139, 144–45 (1993). 7
7 The parties originally disputed on appeal whether the district court’s order
denied immunity to both the Plan and Association, or just the Association. In
their brief, the Arvens have now changed their position on jurisdiction and say
they “do not object to construing any record ambiguity in favor of the conclu-
sion that the district court denied immunity as to the Plan.” In any event, the
Court may consider the Plan’s immunity even if the Plan did not preserve it
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STANDARD OF REVIEW
Whether an entity constitutes an arm of the state under the
Eleventh Amendment immunity analysis is a question of law sub-
ject to de novo review. U.S. ex rel. Lesinski v. S. Fla. Water Mgmt.
Dist., 739 F.3d 598, 602 (11th Cir. 2014).
DISCUSSION
As relevant here, the FCA subjects to liability “[a]ny person”
who, among other things, “knowingly presents, or causes to be
presented, to an officer or employee of the United States Govern-
ment . . . a false or fraudulent claim for payment or approval.” 31
U.S.C. § 3729(a). So the Association and the Plan can be liable un-
der the FCA only if they qualify as “persons.”
The Supreme Court has held that states and agencies acting
as arms of the state are not “persons” for purposes of FCA qui tam
liability. See Vt. Agency of Nat. Res. v. U.S. ex rel. Stevens, 529
U.S. 765, 788 (2000). We have further clarified that, because the
scope of each inquiry is the same, “courts should employ the Elev-
enth Amendment arm of the state analysis to determine whether a
in the district court. See Access Now, Inc. v. Sw. Airlines Co., 385 F.3d 1324,
1332 (11th Cir. 2004) (principle that Court will not entertain new arguments
on appeal is not jurisdictional). In addition, the doctrine of pendant appellate
jurisdiction allows us to consider otherwise-unreviewable questions that are
inextricably intertwined with an issue that is reviewable. See Summit Med.
Assocs., P.C. v. Pryor, 180 F.3d 1326, 1335 (11th Cir. 1999). For these reasons,
we review the Eleventh Amendment immunity and “person” status under the
FCA for both the Association and the Plan.
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state entity is a ‘person’ subject to FCA liability.” Lesinski, 739 F.3d
at 602.
In the Eleventh Circuit, to determine whether an entity is an
arm of the state, we use the Manders factors. See Manders v. Lee,
338 F.3d 1304 (11th Cir. 2003). Those factors include the following:
(1) how state law defines the entity; (2) what degree of control the
State maintains over the entity; (3) where the entity derives its
funds; and (4) who is responsible for judgments against the entity.
Lesinski, 739 F.3d at 602. We apply each factor in turn.
I. How Florida Law Defines NICA
Whether an entity is an arm of the state ultimately presents
a question of federal law. But we determine that answer “by care-
fully reviewing how the agency is defined by state law.” Versiglio
v. Bd. of Dental Exam’rs of Ala., 686 F.3d 1290, 1291 (11th Cir.
2012). “The state law provides assistance in ascertaining whether
the state intended to create an entity comparable to a county or
municipality or one designed to take advantage of the state’s Elev-
enth Amendment immunity.” Tuveson v. Fla. Governor’s Council
on Indian Affs., Inc., 734 F.2d 730, 732 (11th Cir. 1984).
In ascertaining how the state treats the Association and the
Plan, we look to both state-court precedent and legislative clues.
We begin with state-court precedent.
In Coy v. Florida Birth-Related Neurological Injury Com-
pensation Plan, 595 So. 2d 943 (Fla. 1992), a group of non-obstetri-
cian physicians challenged the annual assessment they must pay to
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NICA. The Florida Supreme Court characterized NICA as “a gov-
ernmental enterprise, i.e., a state-created system for compensating
certain individuals for certain types of birth-related injuries.” Coy,
595 So. 2d at 945. It then held that the assessments qualified as
“taxes” under Florida law, but that the taxes were valid. Id.; id. at
948. And in Samples v. Florida Birth-Related Neurological Injury
Compensation Association, 114 So. 3d 912, 917 (Fla. 2013), the Flor-
ida Supreme Court, in passing, called NICA a “state program”
while upholding an award maximum. These cases tend to support
the notion that Florida courts treat NICA as an arm of the state.
Next, we consider any insight the Florida legislature may
have provided. The Florida legislature enacted a provision stating
that “[s]overeign immunity is hereby waived on behalf of the [As-
sociation] solely to the extent necessary to assure payment of com-
pensation [by the Plan].” Fla. Stat. § 766.303(3).
NICA argues that this shows that the Florida legislature be-
lieved it was creating a state entity that had sovereign immunity,
or else there would have been nothing to waive. In response, the
Arvens assert that NICA conflates sovereign immunity from suit in
state court with Eleventh Amendment immunity from suit in fed-
eral court. The Arvens, of course, are right that “the Eleventh
Amendment deals only with federal jurisdiction to hear suits
against the state, not with the state’s immunity from suit in any
forum.” Hufford v. Rodgers, 912 F.2d 1338, 1340–41 (11th Cir.
1990) (alteration omitted). But that does not mean the state statute
has no significance.
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Here, though, the Florida legislature sent some mixed sig-
nals. On the one hand, the statute suggests the Florida legislature
may have intended to create an arm of the state when it devised
NICA. This logic especially makes sense when we remember that
we’re using the Manders factors to determine whether NICA is a
“person” under the FCA, not necessarily whether NICA is entitled
to Eleventh Amendment immunity.
But on the other hand, the Florida legislature characterized
NICA as “not a state agency, board, or commission.” Fla. Stat. §
766.315(1)(a). This language tends to support the idea that Florida
doesn’t consider NICA an arm of the state.
Nevertheless, there’s no bright-line rule that an entity must
be characterized as an agency, board, or commission to be an arm
of the state. See, e.g., Lesinski, 739 F.3d at 606 (holding that the
South Florida Water Management District was an arm of the state).
In Florida’s False Claims Act, for example, “State” is defined as “the
government of the state or any department, division, bureau, com-
mission, regional planning agency, board, district, authority,
agency, or other instrumentality of the state.” Fla. Stat. §
68.082(1)(f).
On balance, we conclude this factor supports finding that
NICA is an arm of the state.
II. The Degree of Control Florida Maintains Over NICA
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Next, we review the degree of control Florida maintains
over NICA. That is, we consider whether the legislature retained
authority over NICA or whether it is instead more autonomous.
NICA argues that Florida exercises substantial control over
NICA for two primary reasons: (1) Florida’s CFO appoints the
members of the Association, and (2) Florida statutes carefully pre-
scribe all NICA’s operational aspects. We disagree.
In Lesinski, we found that state control of the Water District
was “pervasive and substantial” where several conditions existed:
the District was governed by a board whose members and Execu-
tive Director were appointed by the Governor and approved by the
Florida Senate; the Governor was empowered to remove any of-
ficer of the District; the District’s budget had to be submitted to the
Governor, Senate President, Speaker of the House, the Secretary
of the Department of Environmental Protection, and various legis-
lative committees; the District’s budget was subject to approval by
the Governor; and the Florida Land and Water Adjudicatory Com-
mission had the exclusive authority to review the District’s rules.
Lesinski, 739 F.3d at 603.
NICA has some of these qualities, but it lacks others. Its
board is appointed by Florida’s CFO, who is a constitutional officer
elected state-wide, like the Governor. But Florida’s Senate does
not have the power to approve (or disapprove) NICA’s board
members. And the Governor and CFO can remove board directors
only “for misconduct, malfeasance, misfeasance, or neglect of duty
in office,” Fla. Stat. § 766.315(2)(c)—in other words, only “for
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cause.” That is a significant limitation on the Governor’s and
CFO’s removal power. Cf. Seila Law LLC v. Consumer Fin. Prot.
Bureau, 140 S. Ct. 2183, 2198 (2020) (discussing importance of Pres-
ident’s unfettered removal powers).
As for the review of NICA’s rules, NICA doesn’t make any
rules for anyone to review, but it is required to annually submit
audited financials to the Florida Joint Legislative Auditing Commit-
tee and the Office of Insurance Regulation, both of which may au-
dit NICA whenever they wish. Fla. Stat. § 766.315(5)(e). And since
November 2021, NICA has been required to annually submit a re-
port with information about claimants and compensation to the
Governor, President of the Senate, Speaker of the House, and CFO.
Id. § 766.315(8). But unlike with the Water District in Lesinski,
NICA doesn’t have to get its budget approved by anyone.
And NICA is greatly autonomous when it comes to its day-
to-day operations of administering claims. The board of directors
of NICA has the following enumerated powers:
(a) Administer the plan.
(b) Administer the funds collected on behalf of the
plan.
(c) Administer the payment of claims on behalf of the
plan.
(d) Direct the investment and reinvestment of any
surplus funds over losses and expenses, if any
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investment income generated thereby remains cred-
ited to the plan.
(e) Reinsure the risks of the plan in whole or in part.
(f) Sue and be sued, and appear and defend, in all ac-
tions and proceedings in its name to the same extent
as a natural person.
(g) Have and exercise all powers necessary or conven-
ient to effect any or all of the purposes for which the
plan is created.
(h) Enter into such contracts as are necessary or
proper to administer the plan.
(i) Employ or retain such persons as are necessary to
perform the administrative and financial transactions
and responsibilities of the plan and to perform other
necessary and proper functions not prohibited by law.
(j) Take such legal action as may be necessary to avoid
payment of improper claims.
(k) Indemnify any employee, agent, member of the
board of directors or alternate thereof, or person act-
ing on behalf of the plan in an official capacity . . . .
Id. § 766.315(4)(a)–(k). It also chooses how to invest the Plan’s
funds, subject to statutory limitations. Id. § 766.315(5)(f).
The legislature always has to delegate some authority and
power to agencies for them to work. But when the legislature does
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so to such a significant degree as it has here, that militates in favor
of the conclusion that the entity is autonomous. So this factor
weighs against finding that NICA is an arm of the state.
III. Where NICA derives its funds
Next, the Court must determine “the source of [NICA’s]
funding.” Manders, 338 F.3d at 1344. When it was created, NICA
received an initial $20 million appropriation and has since been
funded exclusively by assessments and investment income. The
legislature set aside an additional $20 million reserve in the state
Insurance Regulatory Trust Fund to be used if NICA ever becomes
not actuarily sound. Fla. Stat. § 766.314(5)(b). And as we have
noted, Florida statutes provide that “[f]unds held on behalf of the
plan are funds of the State of Florida.” Id. § 766.315(5)(f).
NICA argues that it is funded “exclusively by the State.” It
cites to Williams v. District Board of Trustees of Edison Commu-
nity College, Florida, 421 F.3d 1190, 1194 (11th Cir. 2005), to show
that state funding points to a finding that an entity is an arm of the
state. [Id.]. While that proposition is no doubt true, the Williams
Court focused more on the fact that the state had to approve the
budget of the community college there in determining that this fac-
tor weighed in favor of finding that it was an arm of the state. 421
F.3d at 1194. It acknowledged, “Although [the community college]
is not exclusively funded by the state, state approval of institutional
budgets evidences state control.” Id. But as we have noted, NICA’s
budget is not subject to state approval.
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Next, we consider the role the assessments play in funding
NICA—both the mandatory ones that all physicians must pay and
the voluntary ones that obstetricians pay to participate in the Plan.
In Coy, the Florida Supreme Court considered whether the man-
datory assessments were valid and decided they were valid “taxes”
under state law. See Coy, 595 So. 2d at 945. The court did not
specifically consider the nature of the voluntary assessments. But
we note that all the assessments are paid directly to NICA, never
passing though the State treasury. Fla. Stat. § 766.314(3).
NICA argues that the rationale of Coy applies to both the
mandatory and voluntary assessments; they are all “taxes,” so
NICA is state-funded. We disagree. In holding that the mandatory
assessments were taxes, the Coy court explained,
Initially, we find that the [mandatory] $250 assess-
ment in this case constitutes a “tax” within the mean-
ing of Florida law. In the past, we have defined a tax
as an enforced pecuniary burden laid on individuals
or property to support government. . . . Here, the
$250 assessment is levied upon physicians to support
a governmental enterprise, i.e., a state-created system
for compensating certain individuals for certain types
of birth-related injuries. The assessment is collected
under authority of state law, and the Plan can sue to
enforce the assessment. . . . It thus is a tax and is sub-
ject to the requirements of law applicable to taxes.
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595 So. 2d at 945 (emphases added). Both assessments are of course
“collected under authority of state law,” but the voluntary assess-
ments are not “enforced” or “levied.” They are voluntary for ob-
stetricians who would prefer the no-fault liability system to regular
tort liability. If an obstetrician doesn’t want to pay the assessment
and participate in NICA, she isn’t obligated to do so. So the Coy
court’s reasoning for characterizing the mandatory payments as
“taxes” does not apply to the obstetricians’ payments. Nor is it
even consistent with the common sense understanding of “taxes”
as mandatory. Rather, as the district court found, the voluntary
assessments are more like insurance premiums that the obstetri-
cians would otherwise pay to a malpractice insurer than they are
like taxes. Providing insurance is traditionally a private enterprise,
so the government’s decision to wade into that field suggests that
NICA does not act as an arm of the state.
In any event, NICA is funded far more by its investment in-
come than by assessments. In 2019, NICA earned more than $103
million from its investments, which was almost 4 times its revenue
from assessments. The Arvens argue that this makes this factor
weigh against finding that NICA is an arm of the state. NICA re-
sponds that the initial appropriation and the assessments are state
funds, and they generated the investment income, so the invest-
ment income shouldn’t weigh against an arm-of-the-state finding.
We are not persuaded. In Hess v. Port Authority Trans-
Hudson Corp., 513 U.S. 30 (1994), the Supreme Court considered
whether the Port Authority Trans-Hudson Corporation was an
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arm of the state and enjoyed Eleventh Amendment immunity. It
concluded it did not. In reaching this decision, the Court noted
that the Port Authority had once received appropriations from the
states but hadn’t for a long time because it was so well-funded by
its investment income, tolls, and fees. Indeed, the Court observed
that the Port Authority was “[c]onceived as a fiscally independent
entity financed predominantly by private funds, . . . [so] the Au-
thority generate[d] its own revenues, and for decades ha[d] re-
ceived no money from the States.” Hess, 513 U.S. at 45. We also
emphasized this point in Manders, when we distinguished Hess.
We explained that the Port Authority “was financially independ-
ent, with funds from private investors, tolls, fees, and investment
income.” Manders, 338 F.3d at 1325 (citing Hess, 513 U.S. at 36,
49–50).
To be sure, NICA differs from the Port Authority in that, at
one point, the Port Authority (unlike NICA) had also been funded
by private investors. But that’s not what the Supreme Court found
significant. Rather, when the Supreme Court concluded that the
Port Authority was not an arm of the state, the Court emphasized
that the Port Authority “generate[d] its own revenues” and “for
decades ha[d] received no money from the States,” Hess, 513 U.S.
at 45. As we have explained, NICA shares these qualities.
So on balance, this factor weighs against a finding that NICA
is an arm of the state. NICA’s budget is not subject to approval by
the state (like the budget in Williams, 421 F.3d at 1194), the volun-
tary assessments NICA collects are more like malpractice insurance
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premiums (which are traditionally collected by private insurance
companies) than like taxes, and NICA’s primary source of funding
comes from investment income rather than state funds (like for the
Port Authority in Hess, 513 U.S. at 45).
IV. Who Is Responsible for Judgments Against NICA?
Last, and “most important,” Freyre v. Chronister, 910 F.3d
1371, 1384 (11th Cir. 2018), we must determine whether Florida’s
state treasury would have to pay a judgment against NICA. See
Manders, 338 F.3d at 1324–27.
NICA argues that, because its funds are “funds of the State
of Florida,” Fla. Stat. § 766.315(5)(f), any judgment against NICA is
necessarily against the state. It also argues that if “judgments
against NICA become large enough, the State would be able to pre-
serve the Plan’s actuarial soundness only by raising the taxes which
fund the Plan or appropriating general treasury funds.” In support,
NICA relies on Lesinski. There, we held that a judgment against
the South Florida Water Management District implicated the
state’s treasury because “[s]hould judgment creditors deplete the
District’s funds to the point that it can no longer effectively func-
tion, the State would ultimately have to choose between increasing
its appropriation to make up the shortfall or shirking its constitu-
tionally mandated duty to ‘conserve and protect [the State’s] natu-
ral resources and scenic beauty.’” 739 F.3d at 605.
We do not agree with NICA’s conclusion. For starters, the
mere fact that the legislature called NICA’s funds the state’s funds
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in a statute can’t circumvent the Manders-factors analysis if a func-
tional analysis of the reality shows that the state is not responsible
for judgments against NICA. So the language from the Florida stat-
ute isn’t dispositive.
And here, NICA’s argument that the state treasury would
have to step in if the judgment is large enough is too speculative.
That contention ignores NICA’s very solvent position. Indeed, it’s
unlikely that the judgments would ever be high enough to drain all
NICA’s funds. But perhaps even more significantly, we don’t even
know whether the state would pay the judgments if NICA didn’t
have enough money. Based on the information submitted by the
parties, it’s just as likely that the legislature would let NICA go in-
solvent and abandon the whole program. Unlike in Lesinski, the
state’s under no constitutional duty to operate NICA.
Other circuits have also rejected reasoning much like
NICA’s. See Fresenius Med. Care Cardiovascular Res., Inc. v. P.R.
& Caribbean Cardiovascular Ctr. Corp., 322 F.3d 56, 75 (1st Cir.
2003) (“In the end, [the entity’s] argument is simply that a judg-
ment would deplete its operating funds, that the Commonwealth
might choose to rescue it, and that this would indirectly deplete the
state treasury. We rejected this very argument [previously], and
do so here.”); Bolden v. Se. Pa. Transp. Auth., 953 F.2d 807, 819 (3d
Cir. 1991) (“discretionary subsidies [by the state] committed in re-
action to a judgment, however, would not necessarily transform
the recipients into alter egos of the state”).
USCA11 Case: 20-13448 Date Filed: 04/21/2022 Page: 21 of 21
20-13448 Opinion of the Court 21
In short, this factor weighs against finding that NICA is an
arm of the state.
CONCLUSION
In sum, one Manders factor points towards finding that
NICA is an arm of the state and three factors—including the most
important one—weigh against that conclusion. We therefore hold
that NICA has failed to show that it is an arm of the state entitled
to Eleventh Amendment immunity and not a “person” under the
FCA, and we affirm the decision of the district court.
AFFIRMED.