Reston Hospital Center, LLC v. Karen Remley, M.D., M.B.A., F.A.A.P., etc.

COURT OF APPEALS OF VIRGINIA
Present: Chief Judge Felton, Judges Humphreys and Kelsey
PUBLISHED
Argued at Alexandria, Virginia
RESTON HOSPITAL CENTER, LLC
OPINION BY
v. Record No. 2301-12-4 JUDGE D. ARTHUR KELSEY
SEPTEMBER 30, 2014
KAREN REMLEY, M.D., M.B.A., F.A.A.P.,
FORMER STATE HEALTH COMMISSIONER,1
INOVA HEALTH CARE SERVICES, D/B/A
INOVA FAIR OAKS HOSPITAL
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY
Pamela S. Baskervill, Judge Designate
Robert L. Hodges (Nathan A. Kottkamp; Thomas J.
Stallings, Jeffrey D. McMahan, Jr.; McGuire Woods LLP,
on briefs), for appellant.
Ishneila G. Moore, Assistant Attorney General (Kenneth
T. Cuccinelli, II, Attorney General; Rita W. Beale,
Deputy Attorney General; Allyson K. Tysinger, Senior
Assistant Attorney General, on briefs), for appellee Karen
Remley, former State Health Commissioner.
Amandeep S. Sidhu (M. Miller Baker; H. Guy Collier;
Mary D. Hallerman; McDermott Will & Emery LLP, on
briefs), for appellee Inova Health Care Services, d/b/a
Inova Fair Oaks Hospital.
The State Health Commissioner issued a certificate of public need (COPN) to Inova
Health Care Services authorizing it to relocate a medical radiation therapy service from Inova
Fairfax Hospital to Inova Fair Oaks Hospital, both situated in Fairfax County. A competitor,
Reston Hospital Center, LLC, objected to the relocation during the administrative process and on
1
The title page of the Attorney General’s brief names acting Commissioner Cynthia
Romero, M.D., F.A.A.P., as the appellee. The signature page of the same brief, however, names
Karen Remley, M.D., M.B.A., F.A.A.P., former State Health Commissioner, as appellee.
Because the original notice of appeal names former Commissioner Karen Remley as the
appellee, Remley is the named party to this appeal.
appeal to the circuit court. The circuit court held that the Commissioner acted within her
authority when she issued the COPN. We agree and affirm the circuit court’s ruling.
I. BACKGROUND
A. The Administrative Regulatory System
A comprehensive regulatory system governs nearly every aspect of medical care facilities
in the Commonwealth.2 Article 1.1, Chapter 4 of Title 32.1 requires a “certificate of public
need” for various types of projects conducted by medical care facilities. Code § 32.1-102.1.
“No person shall commence any project without first obtaining a certificate issued by the
Commissioner. No certificate may be issued unless the Commissioner has determined that a
public need for the project has been demonstrated.” Code § 32.1-102.3(A). The statute directs
the Board of Health to establish “regional health planning agencies,” which manage the “health
planning regions” in the Commonwealth and assist the Board in a number of ways, including by
“reviewing applications for certificates of public need and making recommendations to the
Department.” Code § 32.1-122.05. The Board of Health must also prepare a “State Medical
Facilities Plan” to guide planning and forecasting efforts. Code § 32.1-102.1.
B. The Dispute over the Location of a Single Linear Accelerator
Several hospitals are located in Health Planning Region II (HPR II), which encompasses
the same area as Planning District 8 (PD 8) and includes Fairfax County. Multiple hospitals in
HPR II utilize radiation therapy machines, called linear accelerators, to provide cancer treatment
2
An application for a COPN must be reviewed by the local health planning agency and
the Department of Health’s Division of Certificate of Public Need (DCOPN). See Code
§ 32.1-102.6; 12 Va. Admin. Code § 5-220-230. Each group submits a separate report and
recommendation to the Commissioner. Upon a showing of good cause, a non-applicant party
may become a party to the application proceedings. An adjudication officer for the
Commissioner then holds an Informal Fact Finding Conference, during which he receives
evidence and hears the parties’ arguments. The adjudication officer provides a recommendation
to the Commissioner, who makes the final agency decision on the application.
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services. Inova Fairfax has four linear accelerators, and Reston has two. Although Inova Fair
Oaks provides extensive cancer treatment services, it does not have a linear accelerator.
In 2008, Inova applied for a COPN to add a linear accelerator to Inova Fair Oaks. The
Commissioner denied the application for a number of reasons, including because there was no
demonstrable need for a new linear accelerator in that area of service. The Commissioner had
previously authorized the operation of thirteen linear accelerators in HPR II, and she determined
that there was no need for one more.
A few months later, Inova submitted a new application — the one at issue in this case —
for a COPN authorizing a “proposed project . . . to move one of four existing linear accelerators
from the campus of Inova Fairfax Hospital to the campus of Fair Oaks Hospital.” App. at 1441.
The project would involve the decommissioning of one of Inova Fairfax’s older linear
accelerators, thereby reducing the number of such machines at Inova Fairfax from four to three,
and the relocation of that service (with the installation of a new linear accelerator) to Inova Fair
Oaks. With its proposed change, Inova pointed out, HPR II would still have thirteen linear
accelerators.
During the administrative process, Reston intervened as a “good cause” party. Id. at 635.
Reston asserted various reasons why the Commissioner should not issue the COPN to Inova.
The Commissioner rejected Reston’s objections and issued the COPN on August 26, 2009,
designating it COPN No. VA-04223. Reston appealed to the circuit court under the Virginia
Administrative Process Act (VAPA), Code §§ 2.2-4000 through -4033. The circuit court held
that Reston did not have standing and dismissed the appeal. On appeal to our Court, we reversed
and remanded the case to the circuit court for a decision on the merits. See Reston Hosp. Ctr.,
LLC v. Remley, 59 Va. App. 96, 717 S.E.2d 417 (2011). On remand, the circuit court upheld the
Commissioner’s decision to issue the COPN to Inova. Reston again appealed to us. Over
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Inova’s objection, the circuit court extended Reston’s time to file its notice of appeal pursuant to
Code § 8.01-428(C).
While the case has been on appeal, the Commissioner issued another certificate,
designated COPN No. VA-04386 (issued April 19, 2013). It authorized the “[r]elocation and
replacement of the existing linear accelerator located in the satellite facility at 8503 Arlington
Boulevard (in Fairfax County) to Inova Fair Oaks Hospital (also in Fairfax County).”
Appellant’s Supp’l Br. Ex. A at 3.3 The certificate added that the “relocation of the Arlington
Boulevard linear accelerator will be in place of the linear accelerator authorized for relocation
from Inova Fairfax Hospital under COPN No. VA-04223.” Id.
After oral argument in this appeal, the Commissioner issued a “corrected certificate” on
June 13, 2013, because “[t]he original certificate issued on April 19, 2013 did not reflect the
project as specified in the letter of intent and requested in the application.” Appellant’s Supp’l
3
Although no party has raised this issue before this Court, it appears that the application
for the 2013 COPN makes inconsistent statements regarding the number of linear accelerators
present at Inova Fairfax. At one point, the application notes that “Inova Fairfax Hospital is
currently approved for and operates four (4) linear accelerators.” R. at 988 (Appellee Inova’s
Reply Br. in Supp. of Mootness on remand to the circuit court, Ex. A). This is consistent with
the facts presented in the administrative record for the 2009 COPN, which referenced the four
linear accelerators at Inova Fairfax and never mentioned the Arlington Boulevard satellite
facility. However, the next line of the application for the 2013 COPN distinguishes between the
three linear accelerators “located on the main hospital campus [of Inova Fairfax]” and the one
“located at a satellite campus location [on Arlington Boulevard].” Id. Then, in the next
paragraph, the application references the 2009 COPN and states that it “would require Inova
Fairfax Hospital to take one (1) of its three (3) units out of service.” Id. Our review of the
administrative record for the 2009 COPN reveals only broad references to the four units at Inova
Fairfax and does not mention whether the unit that is being relocated to Inova Fair Oaks must
come from the main campus or the satellite facility. Nevertheless, for reasons that are not clear
from the record, Inova appeared to interpret the 2009 COPN as authorizing the relocation of a
unit from the main campus of Inova Fairfax rather than the satellite facility. In response to that
perceived result, Inova applied for an additional COPN to allow the main campus of Inova
Fairfax to “continue to utilize the linear accelerator currently in place,” and instead
decommission and relocate the satellite facility’s radiation therapy service to Inova Fair Oaks.
Id. In any event, it is not clear why Inova distinguished between the main campus of Inova
Fairfax and the satellite facility in their request for the 2013 COPN but not for the 2009 COPN.
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Br. Ex. B at 1. The certificate, still designated as COPN No. VA-04386, “identifie[d] the correct
project site” as “Inova Fairfax Hospital Main Campus,” id.,4 and no longer included the original
certificate’s language referencing “replacement” of the accelerator previously authorized to
Inova Fair Oaks. Instead, the corrected certificate phrased the approved action as a “[r]elocation
of the existing linear accelerator authorization” from the satellite facility to Inova Fairfax. Id. at
2; compare Appellant’s Supp’l Br. Ex. A (COPN No. VA-04386 (issued Apr. 19, 2013)) with
Appellant’s Supp’l Br. Ex. B (Corrected COPN No. VA-04386 (issued June 13, 2013)).
While retaining appellate jurisdiction, we remanded the case to the circuit court to
address whether COPN No. VA-04386 mooted any need for our review of the original COPN
No. VA-04223 and whether the June 13, 2013 corrections to COPN No. VA-04386 were valid.
In June 2014, the circuit court held that the case was not moot and that the corrections to COPN
No. VA-04386 were valid.
II. EXTENSION OF TIME TO FILE NOTICE OF APPEAL
We first address Inova’s assignment of cross-error claiming that the circuit court
erroneously extended the time for Reston to file its notice of appeal pursuant to Code
§ 8.01-428(C). Inova contends that the circuit court abused its discretion in granting the
extension. We disagree.
Rule 5A:6(a) requires an appellant to file a notice of appeal within thirty days after the
entry of the final order in the circuit court. The General Assembly enacted Code § 8.01-428(C)
4
Inova informed the Commissioner in its letter of intent that it intended to “transfer” one
linear accelerator from a satellite facility in Fairfax “to the Inova Fairfax Hospital Main
Campus.” Appellee Remley’s Supp’l Br. Attach. C. The DCOPN staff report quoted Inova’s
application as “propos[ing] to relocate COPN authorization for the linear accelerator at the
satellite campus to the main hospital campus,” Appellee Inova’s Supp’l Br. Ex. B at 6 n.1, and
noted that “[n]o capital cost is associated with the proposed project,” id. at 8.
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to provide a narrow exception to this thirty-day deadline when an appellant is “not notified by
any means of the entry of a final order,” and the circuit court finds that the lack of notice does
not result from appellant’s “failure to exercise due diligence.” The statute vests the discretion to
grant the party leave to appeal in the circuit court, not the appellate court.
An abuse of discretion occurs “only ‘when reasonable jurists could not differ’” as to the
proper decision. Brandau v. Brandau, 52 Va. App. 632, 641, 666 S.E.2d 532, 537 (2008)
(quoting Robbins v. Robbins, 48 Va. App. 466, 482, 632 S.E.2d 615, 623 (2006)). This highly
deferential standard of review “necessarily implies that, for some decisions, conscientious jurists
could reach different conclusions based on exactly the same facts — yet still remain entirely
reasonable.” Hamad v. Hamad, 61 Va. App. 593, 607, 739 S.E.2d 232, 239 (2013). The circuit
court “has a range of choice, and its decision will not be disturbed as long as it stays within that
range and is not influenced by any mistake of law.” Lawlor v. Commonwealth, 285 Va. 187,
212-13, 738 S.E.2d 847, 861 (2013) (alteration and internal quotation marks omitted).
We apply this “bell-shaped curve of reasonability” based on our “venerable belief that the
judge closest to the contest is the judge best able to discern where the equities lie.” Hamad,
61 Va. App. at 607, 739 S.E.2d at 239. Suffice it to say, “if nothing else,” the abuse-of-
discretion standard “means that the trial judge’s ruling will not be reversed simply because an
appellate court disagrees.” Thomas v. Commonwealth, 44 Va. App. 741, 753, 607 S.E.2d 738,
743 (internal quotation marks omitted), adopted upon reh’g en banc, 45 Va. App. 811, 613
S.E.2d 870 (2005); see also Beck v. Commonwealth, 253 Va. 373, 385, 484 S.E.2d 898, 906
(1997) (noting that, when applying an abuse-of-discretion standard, appellate judges do “not
substitute [their] judgment for that of the trial court”).
Given the unique circumstances of this case, we cannot say that the circuit court abused
its discretion in granting the extension. It appears that all of the circuit court’s orders during this
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protracted litigation — except the final order that triggered the thirty-day deadline for filing the
notice of appeal — had been mailed by the clerk of court to counsel of record as a matter of
course. In addition, it took over a month for the draft final order to be submitted to the court, a
designated judge from another circuit presided over the case pursuant to Code § 32.1-102.9, and
two different clerk’s offices handled the record. Though we may not have been as forgiving as
the circuit court, reasonable jurists could reach different conclusions on the question whether
Reston exercised due diligence under the uncommon conditions of this case. We thus defer to
the circuit court’s decision to extend the deadline for filing the notice of appeal under Code
§ 8.01-428(C).
III. MOOTNESS ON APPEAL
Prior to deciding the merits of this appeal, we must also determine whether this case has
become moot because of the issuance of COPN No. VA-04386 (issued April 19, 2013 and
corrected on June 13, 2013). We conclude that the case continues to present a live, justiciable
controversy.
“A case becomes moot ‘when the issues presented are no longer “live” or the parties lack
a legally cognizable interest in the outcome.’” Ingram v. Commonwealth, 62 Va. App. 14, 21,
741 S.E.2d 62, 66 (2013) (quoting Chafin v. Chafin, 133 S. Ct. 1017, 1019 (2013)). “‘No matter
how vehemently the parties continue to dispute the lawfulness of the conduct that precipitated
the lawsuit, the case is moot if the dispute is no longer embedded in any actual controversy about
the plaintiffs’ particular legal rights.’” Id. at 21-22, 741 S.E.2d at 66 (quoting Already, LLC v.
Nike, Inc., 133 S. Ct. 721, 727 (2013)); see also Daily Press, Inc. v. Commonwealth, 285 Va.
447, 452, 739 S.E.2d 636, 639 (2013) (noting that “a case is moot and must be dismissed when
the controversy that existed between litigants has ceased to exist”). Mootness on appeal can
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occur for a variety of reasons, including settlement agreements5 or other intervening events that
overtake litigable controversies.6
While it is true that a case is moot when “our resolution of an issue could not possibly
have any practical effect on the outcome of the matter,” Norfolk S. Ry. Co. v. City of
Alexandria, 608 F.3d 150, 161 (4th Cir. 2010), the burden of establishing that we lack
jurisdiction rests on “the party who alleges that a controversy before us has become moot,”
Michigan v. Long, 463 U.S. 1032, 1042 n.8 (1983) (quoting Cnty. of Los Angeles v. Davis, 440
U.S. 625, 645 (1979)). “That is, we presume in those circumstances that we have jurisdiction
until some party establishes that we do not for reasons of mootness,” id., unless, of course, we
sua sponte rebut that presumption entirely on our own, de Haan v. de Haan, 54 Va. App. 428,
436, 680 S.E.2d 297, 301 (2009) (“This Court may raise the [jurisdictional] issue sua sponte.”
(quoting Earley v. Landslide, 257 Va. 365, 371, 514 S.E.2d 153, 156 (1999))).
5
See, e.g., Toms v. Allied Bond & Collection Agency, Inc., 179 F.3d 103, 104 (4th Cir.
1999) (holding that a plaintiff’s “settlement extinguished [his] interest in [the] litigation,” thus
mooting the case); Pressley Ridge Sch. v. Shimer, 134 F.3d 1218, 1219-22 (4th Cir. 1998)
(holding that, despite the parties’ agreement to allow the government “to maintain an appeal” on
two general regulatory issues, their settlement agreement as to “all disputed claims” mooted any
actual controversy between the parties); Mattaponi Indian Tribe v. Va. Marine Res. Comm’n, 45
Va. App. 208, 210, 609 S.E.2d 619, 620 (2005) (holding that “a settlement agreed to by all
litigants before the circuit court, consummated by the entry of a consent dismissal order, moots
appellate review of the circuit court’s earlier denial of the appellant’s motion to intervene”).
6
See, e.g., Arizonans for Official English v. Arizona, 520 U.S. 43, 72 (1997) (holding
that an employee’s resignation from the employment at issue resulted in “changed
circumstances,” which “mooted the case stated in her complaint”); Lewis v. Cont’l Bank Corp.,
494 U.S. 472, 483 (1990) (vacating a judgment when legislation enacted after the case began
“mooted the controversy”); Friedman’s, Inc. v. Dunlap, 290 F.3d 191, 197 (4th Cir. 2002)
(explaining that a case is rendered moot “when a state court orders the same relief sought by the
plaintiff in a parallel federal action”); Ross v. Reed, 719 F.2d 689, 693-94 (4th Cir. 1983)
(holding that a plaintiff’s release from prison mooted his challenge to certain prison regulations);
Bevel v. Commonwealth, 282 Va. 468, 480, 717 S.E.2d 789, 795 (2011) (holding that a criminal
appeal was moot because, after the defendant’s death, “there [was] no party seeking to prosecute
the appeal”); Va. Dep’t of State Police v. Elliott, 48 Va. App. 551, 555, 633 S.E.2d 203, 205
(2006) (holding that a case was moot when “[t]he offended party cured the alleged illegality
before it could occur”).
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Inova claims that this appeal is moot. Inova argues that COPN No. VA-04386 (issued
April 19, 2013 and corrected on June 13, 2013) eliminated any need for us to decide whether the
Commissioner properly issued the original COPN No. VA-04223 (issued August 26, 2009).
After all, Inova contends, Reston never intervened in the administrative process for the 2013
COPN. According to this argument, even if we were to invalidate the 2009 COPN, the 2013
COPN would independently validate Inova’s plan to move the linear accelerator to Inova Fair
Oaks. The circuit court rejected this argument, as do we.
The 2013 COPN presupposes the validity of the 2009 COPN. When issuing the 2013
COPN, the Commissioner undoubtedly relied in part on the existence of the 2009 COPN, which
authorized the establishment of radiation therapy services at Inova Fair Oaks and the
corresponding relocation of a linear accelerator from Inova Fairfax to Inova Fair Oaks. That
authorization created the need for the relocation of a linear accelerator from a satellite facility to
Inova Fairfax. The clearest indication that the 2013 COPN added to rather than replaced the
2009 COPN appears in the 2013 COPN as issued on April 19, 2013, which noted that “the total
authorized capital cost . . . for the relocation and replacement of a linear accelerator is included
in COPN No. VA-04223.” Appellant’s Supp’l Br. Ex. A.
The correction issued in June 2013 further clarified that understanding by simply stating
that there was “no capital cost associated with the project” authorized by the 2013 COPN.
Appellant’s Supp’l Br. Ex. B. Essentially, the 2009 COPN authorized the establishment of
radiation therapy services at Inova Fair Oaks by the transfer of one linear accelerator from Inova
Fairfax to Inova Fair Oaks and also authorized the capital cost of that project. The 2013 COPN,
presuming the authorization for radiation therapy services at Inova Fair Oaks under the 2009
COPN, merely effectuates that transfer in a slightly different manner by authorizing Inova
Fairfax to maintain its three current linear accelerators on the main campus and instead
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decommission the unit at the satellite facility. Perhaps this explains why Inova — quite
understandably — has not affirmatively relinquished the 2009 COPN on the assumption that it
can rely exclusively on the 2013 COPN, which Inova nevertheless claims stands incontestably on
its own.
In short, if we were to invalidate the 2009 COPN, the 2013 COPN could be subject to
continuing litigation because the underlying basis for the relocation authorized by the 2013
COPN would be in question. We thus have no confidence that dismissing this appeal as moot
would end the seemingly interminable litigation of the disputed location of this single piece of
medical equipment.7 For these reasons, we decline to dismiss this appeal as moot.8
7
Inova also asserts that the June 13, 2013 correction of COPN No. VA-04386 is an
invalid “revocation of the original COPN [issued April 19, 2013].” Appellee Inova’s Supp’l Br.
at 4. Although Inova argues that “[t]he plain language of the ‘corrected’ June 13, 2013 COPN
reflects the Commissioner’s intent to effectively revoke the original April 19, 2013 COPN,”
Inova offers no substantive analysis to support its argument. Id. at 4-5. On the contrary, both the
Commissioner and Reston contend that the original COPN No. VA-04386 issued on April 19,
2013, contained factual errors and did not accurately reflect Inova’s letter of intent to apply for
the COPN or the application filed in 2012. See Appellee Remley’s Supp’l Br. at 2; Appellant’s
Supp’l Br. at 2-3. Inova’s Letter of Intent, submitted in 2012, clearly stated that the requested
COPN would be “to transfer Radiation Therapy services (1 linear accelerator) from 8503
Arlington Boulevard, Fairfax, Virginia, to the Inova Fairfax Hospital Main Campus.” R. at 937
(Appellee Remley’s Br. in Response to Inova’s Mem. in Supp. of Mootness on remand to the
circuit court, Ex. 5). The application itself repeatedly characterized “the proposed project” as
“relocat[ing] COPN authorization for an existing linear accelerator from an Inova Fairfax
Hospital satellite location to the Inova Fairfax Hospital main campus.” R. at 1001 (Appellee
Inova’s Reply Br. in Supp. of Mootness on remand to the circuit court, Ex. A); see also id. at
998-99. Thus, there was no indication in Inova’s application for the 2013 COPN that it wished
to invalidate the 2009 COPN and replace it entirely with the authorizations provided by the 2013
COPN. While the 2013 COPN effectively results in the transfer of the satellite facility’s linear
accelerator to Inova Fair Oaks (by decommissioning the old unit at the satellite facility and
purchasing a new unit for Inova Fair Oaks), the letter of intent, the application, and the DCOPN
staff report all reflect that the method of accomplishing that goal is by transferring an authorized
service from the satellite facility to the main campus at Inova Fairfax. Regardless, because we
find that this case is not moot under either the original or the corrected COPN No. VA-04386,
we see no need to resolve the question of the validity of the corrections.
8
If the case were truly moot, as Inova contends, one possible and perhaps advisable
remedy would be to vacate the circuit court decision upholding COPN No. VA-04223 because
Inova’s argument that COPN No. VA-04386 independently validates the relocation approved by
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IV. RESTON’S CHALLENGE TO THE 2009 COPN
We now turn to the primary dispute: whether the circuit court erred in holding that the
Commissioner did not violate the law by issuing COPN No. VA-04223 on August 26, 2009.
Before addressing that issue, we must frame the nature of our review.
A. The VAPA Standards of Judicial Review
“Under the VAPA, the circuit court reviews [an] agency’s action in a manner equivalent
to an appellate court’s role in an appeal from a trial court.” Mattaponi Indian Tribe v. Dep’t of
Envtl. Quality, 43 Va. App. 690, 707, 601 S.E.2d 667, 676 (2004) (internal quotation marks
omitted), aff’d in relevant part sub nom. Alliance to Save the Mattaponi v. Dep’t of Envtl.
Quality, 270 Va. 423, 621 S.E.2d 78 (2005). “‘In this sense, the General Assembly has provided
that a circuit court acts as an appellate tribunal.’” Laurels of Bon Air, LLC v. Med. Facilities of
Am. LIV Ltd. P’ship, 51 Va. App. 583, 591, 659 S.E.2d 561, 565 (2008) (quoting Gordon v.
Allen, 24 Va. App. 272, 277, 482 S.E.2d 66, 68 (1997)).
The circuit court “has no authority under [the] VAPA to reweigh the facts in the agency’s
evidentiary record.” Family Redirection Inst., Inc. v. Dep’t of Med. Assistance Servs., 61
Va. App. 765, 771, 739 S.E.2d 916, 920 (2013). The “VAPA authorizes the court to ‘reject the
agency’s findings of fact only if, considering the record as a whole, a reasonable mind would
necessarily come to a different conclusion.’” Id. (quoting Mattaponi Indian Tribe, 43 Va. App.
at 706, 601 S.E.2d at 675). “Nor can the court substitute its own judgment for the agency’s on
COPN No. VA-04223, if true, would render any holding on COPN No. VA-04223 an advisory
opinion. See U.S. Bancorp Mortg. Co. v. Bonner Mall P’ship, 513 U.S. 18, 23 (1994)
(“[V]acatur must be decreed . . . where a controversy presented for review has become moot due
to circumstances unattributable to any of the parties” and “where mootness results from the
unilateral action of the party who prevailed in the lower court.” (internal quotation marks
omitted)); Norfolk S. Ry. Co., 608 F.3d at 161 (“The customary practice when a case is rendered
moot on appeal is to vacate the moot aspects of the lower court’s judgment.”).
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matters committed by statute to the agency’s discretion.” Boone v. Harrison, 52 Va. App. 53,
62, 660 S.E.2d 704, 708 (2008).
That said, “[p]ure statutory construction” involves “a matter within the core competency
of the judiciary” and thus “requires de novo review.” Va. Emp’t Comm’n v. Cmty. Alts., Inc.,
57 Va. App. 700, 708, 705 S.E.2d 530, 534 (2011) (internal quotation marks omitted); see also
Finnerty v. Thornton Hall, Inc., 42 Va. App. 628, 634-35, 593 S.E.2d 568, 571 (2004) (“[P]ure
statutory interpretation is the prerogative of the judiciary.” (quoting Sims Wholesale Co. v.
Brown-Forman Corp., 251 Va. 398, 404, 468 S.E.2d 905, 908 (1996))). The task of interpreting
the Commissioner’s enabling statutes, therefore, is not one we delegate in whole or in part to the
Commissioner.
B. Reston’s Assignments of Error
Although Reston asserts four assignments of error, they can be synthesized into three
substantive arguments: (1) the issuance of the 2009 COPN was “inconsistent” with the State
Medical Facilities Plan (SMFP), (2) the Commissioner failed “to explain sufficiently the basis
for her decision or her departure from prior case decisions,” and (3) the Commissioner’s decision
to issue the 2009 COPN was, on the merits, indefensible. Appellant’s Br. at 3.9
9
One of Reston’s assignments of error challenges the circuit court’s understanding of its
standard of review of the Commissioner’s decision. Reston was prudent to frame the assignment
of error this way. Compare Davis v. Commonwealth, 282 Va. 339, 340, 717 S.E.2d 796, 797
(2011) (dismissing an appellant’s assignment of error because it did “not address any finding or
ruling of the Court of Appeals”), with Rule 5:17(c)(1)(iii) (effective May 16, 2014) (allowing an
assignment of error to a trial court’s decision “so long as the Court of Appeals ruled upon the
specific merits of the alleged trial court error”). Even so, it is unnecessary from any practical
point of view. Our de novo review of the circuit court’s decision under the VAPA is
conceptually analogous to the circuit court’s review of the Commissioner’s decision. The circuit
court conducted no factfinding to which we must defer. Nor were there any discretionary calls
made during the course of the circuit court’s proceedings. And even if the circuit court had made
such mistakes, the right-result-wrong-reason doctrine would require affirmance as long as there
were no genuine issues of material fact to be decided. See generally Banks v. Commonwealth,
280 Va. 612, 617, 701 S.E.2d 437, 440 (2010) (noting that “where the correct conclusion has
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1. The State Medical Facilities Plan
Reston contends that the Commissioner did not comply with Code § 32.1-102.3(A),
which provides that any COPN issued “shall be consistent” with the most recent applicable
provisions of the SMFP. The inconsistency, Reston argues, arises from the portion of the SMFP
entitled “Need for new service.” 12 Va. Admin. Code § 5-230-290.10 Subsection (A)(1) states
that “[n]o new radiation therapy service should be approved unless . . . [e]xisting radiation
therapy machines located in the health planning district performed an average of 8,000
procedures per existing and approved radiation therapy machine in the relevant reporting
period.” Id. § 5-230-290(A)(1). Reston correctly points out that, for several years prior to the
issuance of the 2009 COPN, PD 8 performed less than an average of 8,000 procedures per linear
accelerator. For this reason alone, Reston concludes, the Commissioner was without authority to
authorize the new linear accelerator service at Inova Fair Oaks.
The flaw underlying Reston’s argument is the assumption that the phrase “new radiation
therapy service,” as used in 12 Va. Admin. Code § 5-230-290(A)(1), includes the mere
relocation of an existing service from one hospital to another hospital, which is owned and
operated by the same company and serves patients within the same planning district. The
been reached but the wrong reason given,” the Supreme Court of Virginia will “sustain the result
and assign the right ground” (internal quotation marks omitted)); Perry v. Commonwealth, 280
Va. 572, 579, 701 S.E.2d 431, 435 (2010) (explaining the development of the “the right result for
the wrong reason doctrine” in Virginia).
10
The Commissioner’s duty to act “consistent with” the SMFP means only that her
actions need to be “‘compatible with’ . . . or ‘in general agreement with’ [the SMFP] rather than
‘exactly alike’ or ‘the same in every detail.’” Loudoun Hosp. Ctr. v. Stroube, 50 Va. App. 478,
506, 650 S.E.2d 879, 893 (2007) (quoting Chippenham & Johnston-Willis Hosps., Inc. v.
Peterson, 36 Va. App. 469, 479, 553 S.E.2d 133, 138 (2001)); see also Roanoke Mem’l Hosps. v.
Kenley, 3 Va. App. 599, 606, 352 S.E.2d 525, 529 (1987) (stating that “[b]oth the Code and the
[SMFP] recognize that the Commissioner will exercise some discretion in issuing a [COPN] to
determine whether [the Commissioner’s] decision is ‘consistent with’ the standard in the
[SMFP]”).
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ordinary understanding of the word “new” does not naturally lend itself to this interpretation.11
Though the linear accelerator service was new to Inova Fair Oaks, it was not new to Inova.
Inova merely relocated the service from one hospital to another. Nor was the service new to the
planning district. PD 8 had thirteen linear accelerators before the relocation and thirteen after.
We thus reject Reston’s reading of “new radiation therapy service,” 12 Va. Admin. Code
§ 5-230-290(A)(1), to include the unique circumstances presented in COPN No. VA-04223.12
The banter over the textual meaning of the words in a statute or regulation must always
be framed by the manifest legislative will underlying the law. One of the principal purposes of
the Medical Care Facilities Certificate of Public Need Law, originally enacted in 1973, was “to
assist in promoting the highest quality of health care at the lowest possible cost.” 1973 Va. Acts
11We are aware of the adjudication officer’s recommendation to the Commissioner on
this issue. At one point in his report, he stated that “[t]he 8,000-treatment provision is plainly
applicable to a new service” like the one intended for Inova Fair Oaks. App. at 626. He made
this statement “despite” the “concurrently reasonable (but secondary) characterization” of the
service as a “relocation” of a service “that would not increase PD 8’s inventory of linear
accelerators.” Id. He nonetheless concluded that Inova’s request was “generally consistent”
with the threshold and “in overall harmony or general agreement with the provision (and the
SMFP generally) and the public interest and purposes to which that plan is devoted.” Id. Given
our interpretation of 12 Va. Admin. Code § 5-230-290(A)(1), we need not dissect this view or
rule upon its legitimacy. “When an issue or claim is properly before the court, the court is not
limited to the particular legal theories advanced by the parties, but rather retains the independent
power to identify and apply the proper construction of governing law.” Kamen v. Kemper Fin.
Servs., Inc., 500 U.S. 90, 99 (1991); see also United States ex rel. May v. Purdue Pharma L.P.,
737 F.3d 908, 913 n.3 (4th Cir. 2013) (noting that although the parties did “not raise [a]
particular argument,” the court was “not preclude[d] in [its] consideration and application of it”).
“The contrary conclusion would permit litigants, by agreeing on the legal issue presented, to
extract the opinion of a court on hypothetical [legislative acts] or dubious constitutional
principles, an opinion that would be difficult to characterize as anything but advisory.” U.S.
Nat’l Bank of Ore. v. Indep. Ins. Agents of Am., Inc., 508 U.S. 439, 447 (1993).
12
We acknowledge Reston’s reliance on Code § 32.1-102.3, which requires the issuance
of a COPN for any “project.” The definition of “project” includes, among other things, the
“[i]ntroduction into an existing medical care facility of any new . . . radiation therapy . . . which
the facility has never provided or has not provided in the previous 12 months.” Code
§ 32.1-102.1. However, the question we must answer is not whether a COPN was required — it
clearly was — but rather, whether the Commissioner had the lawful discretion to issue one to
Inova.
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ch. 419; see also 12 Va. Admin. Code § 5-230-30 (listing the “general principles” behind the
COPN program and including “cost effectiveness and quality of medical services in Virginia”).13
The COPN requirement was meant to limit access to the competitive, free market only to the
extent that it might endanger those legislative goals. See generally FTC v. Phoebe Putney Health
Sys., 133 S. Ct. 1003, 1015-16 (2013) (interpreting a similar regulatory scheme “in light of our
national policy favoring competition, . . . to reflect more modest aims” than expansive
“anticompetitive conduct,” even though the scheme “does limit competition in the market for
hospital services in some respects”). Interpreted in light of these policy goals, the phrase “new
radiation therapy service,” as used in 12 Va. Admin. Code § 5-230-290(A)(1), does not include
the relocation of an existing service from one hospital to another hospital, which is owned and
operated by the same company and serves patients within the same planning district.
2. Alleged Departure from Prior Case Decisions
Reston also argues that the Commissioner acted arbitrarily and capriciously by issuing
the COPN to Inova under circumstances that, according to Reston, have never been found
previously by the Commissioner to be acceptable. The nine examples Reston gives as precedent,
however, all apparently involve requests for COPNs for truly new services, not the relocation of
13
The economic assumptions underlying Virginia’s COPN law have since been
questioned. See Colon Health Ctrs. of Am., LLC v. Hazel, 733 F.3d 535, 545 (4th Cir. 2013)
(noting that “the Department of Justice and the Federal Trade Commission [have concluded] that
certificate ‘programs are not successful in containing health care costs, and . . . pose serious
anticompetitive risks that usually outweigh their purported economic benefits’” (citation
omitted)); Va. Senate Doc. 6, at 9 (2001) (noting that “many of the issues presumed addressed by
[the 1974 federal health planning law] remain major concerns in 2000, e.g., cost containment,
indigent care, quality of care, access to care, consumer involvement, distribution of services in
medically underserved areas, prevention, utilization review, and education of the public in
personal care and in the use of the health care system”); Va. Senate Doc. 11, at 6 (1988)
(summarizing the findings of a commission organized to study the COPN law and observing that
“the Certificate of Public Need law no longer serves as a viable mechanism for containing the
cost of health care provided by hospitals”).
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existing services — at least no one has suggested to us otherwise. Reston acknowledges that
“[t]he only possible explanation is the fact that Inova’s project purportedly involves the
relocation of an existing linear accelerator,” Appellant’s Br. at 22, but Reston rejects that
explanation as a “distinction without a difference,” id. at 6.
Reston’s argument fails because it presupposes too much. As we explained earlier, a
sensible distinction exists between issuing a COPN for a new service that expands existing
capacity and a mere relocation of an existing service that does not. See supra Part IV.B.1. In
our view, 12 Va. Admin. Code § 5-230-290(A)(1) incorporates that distinction. This point more
than answers Reston’s inconsistency challenge because the 2009 COPN awarded to Inova cannot
be compared fairly to prior COPNs involving wholly new services that increased the inventory of
medical services or machines in the relevant planning district. Reston, therefore, has not shown
that the Commissioner made a “‘sudden and unexplained change’” in administrative policy or
“fail[ed] to take into account ‘legitimate reliance on prior interpretation.’” Appellant’s Br. at 19
(quoting Boyd v. People, Inc., 43 Va. App. 82, 91, 596 S.E.2d 100, 105 (2004) (Kelsey, J.,
concurring)).14
3. Arbitrary & Capricious Decisionmaking
Reston also contends that the Commissioner’s decision to issue the 2009 COPN should
be judicially vacated because physicians at Inova Fair Oaks who previously have treated cancer
patients have had to refer them, out of necessity, to other hospitals like Reston. If Inova Fair
14
Even if the Commissioner did arbitrarily make a “‘sudden and unexplained change,’”
Boyd, 43 Va. App. at 91, 596 S.E.2d at 105 (Kelsey, J., concurring) (quoting Smiley v. Citibank
(S.D.), N.A., 517 U.S. 735, 742 (1996)), we would not necessarily freeze into perpetuity the
earlier interpretation and reject out of hand the subsequent aberration. Nor would we remand the
case back to the Commissioner for her to decide which of her two interpretations she likes best.
Instead, the “proper judicial response to a situation like this is to jettison altogether any
interpretative deference and do what appellate courts ordinarily do: decide questions of law de
novo.” Id. at 92, 596 S.E.2d at 105.
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Oaks gets a linear accelerator, Reston worries that patients at Inova Fair Oaks may not need to
travel to another hospital for radiation therapy and that, to a certain extent, this would reduce the
revenues that Reston receives for the use by these patients of its linear accelerator. Unmoved by
this argument, the Commissioner concluded that Reston would likely be able “to weather any
competitive stresses that may stem from approval of the project proposed by Inova.” App. at
612.15
The question we must answer is not whether we agree or disagree with the
Commissioner’s exercise of discretion on this issue, but whether she was faithful to her statutory
duty to “consider” the enumerated statutory criteria for the issuance of a COPN. Code
§ 32.1-102.3(B). One of those factors involves “the utilization and efficiency of existing
services or facilities,” Code § 32.1-102.3(B)(5), while another emphasizes “[t]he extent to which
the proposed service or facility fosters institutional competition,” Code § 32.1-102.3(B)(4).16
The parties offer a battery of conflicting statistics in support of their differing views on these
points. We see no need, however, to pick apart the data matrices in the administrative record to
answer this question.
As we have often said, “when the appellant challenges a judgment call on a topic on
which ‘the agency has been entrusted with wide discretion by the General Assembly,’ we will
15
The Commissioner’s adjudication officer also rejected Reston’s argument that the
availability of “a linear accelerator at Fair Oaks would reduce patient volume” for radiation
therapy provided by Reston and another competitor. App. at 629. The adjudication officer made
a factual finding that “historical utilization data provided by [Inova] Fair Oaks reliably show
another picture.” Id. (footnote omitted). Given our view of the case, we need not engage this
factual dispute in any detail.
16
Reston also relies on the SMFP, which states that “new radiation therapy services”
must meet certain performance criteria “without significantly reducing the utilization of existing
services in the health planning district.” 12 Va. Admin. Code § 5-230-290(C). For the reasons
previously discussed, the unique circumstances of this case involve the relocation of an existing
service rather than the initiation of a “new” service. See supra Part IV.B.1.
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overturn the decision only if it can be fairly characterized as ‘arbitrary or capricious’ and thus a
‘clear abuse of delegated discretion.’” Citland, Ltd. v. Commonwealth ex rel. Kilgore, 45
Va. App. 268, 275, 610 S.E.2d 321, 324 (2005) (quoting Vasaio v. Dep’t of Motor Vehicles, 42
Va. App. 190, 196-97, 590 S.E.2d 596, 599 (2004)). “This standard recognizes the larger
premise that, before any legal question can be answered, an a priori question must first be asked
— who has the authority to decide. It is the one question that precedes all others.” Boone, 52
Va. App. at 62, 660 S.E.2d at 708.
The Commissioner conscientiously considered the effect Inova’s relocated service would
likely have on Reston’s market share. And what we have said in analogous circumstances can be
said here: “While it appears the subject was not given dispositive weight, nothing in the statute
requires that any specific factor be given any measurable weight, only that it be considered by
the [agency] during the decisionmaking process.” Id. at 65, 660 S.E.2d at 710. Whatever
“weight that should be properly given to any specific factor” is a discretionary decision for the
agency, “not the courts.” Id. at 66, 660 S.E.2d at 710. It is enough to conclude, as we do, that
nothing in the administrative record, taken as a whole, persuades us that “a reasonable mind
would necessarily come to a different conclusion.” Id. at 62, 660 S.E.2d at 708 (internal
quotation marks omitted).
V.
In sum, we find no abuse of discretion in the circuit court’s decision to extend Reston’s
time to file its notice of appeal. Nor do we believe the case has been rendered moot by the
issuance of COPN No. VA-04386 (issued April 19, 2013 and corrected on June 13, 2013). On
the merits, we hold that the Commissioner lawfully issued COPN No. VA-04223 and that the
circuit court correctly rejected Reston’s challenge to the Commissioner’s decision.
Affirmed.
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