New York Law Review

Giuliani v. Commissioner of New York State Department of Health, 12 N.Y.3d 433 (2009): Eleventh Amendment Immunity and Attorney’s Fees in Medicaid Cases

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Giuliani v. Commissioner of New York State Department of Health, 12 N.Y.3d 433 (2009)

The Eleventh Amendment does not bar suits against state officials in their official capacity seeking prospective relief to end ongoing violations of federal law, even if such relief has an ancillary effect on the state treasury; however, attorney’s fees under 42 U.S.C. § 1988 are only available if the plaintiff prevails on a federal claim.

Summary

This case concerns whether a Medicaid applicant, Giuliani, could recover attorney’s fees from the Commissioner of the New York State Department of Health (DOH) under 42 U.S.C. § 1988(b). Giuliani argued that DOH’s calculation of his wife’s “community spouse resource allowance” (CSRA) violated the federal Medicaid Act. The Court of Appeals held that while the Eleventh Amendment does not bar Giuliani’s suit because he sought prospective relief, it could not determine whether the lower court had awarded relief on federal grounds. The case was remitted to determine if DOH’s CSRA calculation violated federal law and whether Giuliani was entitled to attorney’s fees.

Facts

Giuliani applied for Medicaid benefits in October 2004, which was denied because his household income and resources exceeded permissible limits. He requested an administrative fair hearing to reverse the denial and establish an increased CSRA for his wife. The Administrative Law Judge (ALJ) affirmed the denial but found his wife entitled to an increased CSRA, remanding the matter to determine how much of Giuliani’s excess resources were needed to purchase a life annuity to raise his wife’s income to the threshold amount.

Procedural History

Giuliani commenced a CPLR article 78 proceeding against the Commissioner of DOH, alleging the annuity requirement was arbitrary, capricious, and violated 42 U.S.C. § 1396r-5(e)(2)(C) and the State Administrative Procedure Act. Supreme Court granted the petition, annulling the fair hearing decision and awarding attorney’s fees. The Appellate Division reversed the fee award, holding Giuliani did not prevail on a claim under 42 U.S.C. § 1983. The Court of Appeals reversed and remitted the case.

Issue(s)

1. Whether the Eleventh Amendment bars a suit against a state official seeking to remedy a denial of Medicaid benefits.

2. Whether a party is entitled to attorney’s fees under 42 U.S.C. § 1988 when relief is awarded on state grounds, but a federal claim is also present.

Holding

1. No, because the relief sought was prospective in nature, aiming to end an ongoing violation of federal law and vindicate the right to Medicaid eligibility.

2. The Court could not determine if attorney fees were appropriate because it was unclear whether the lower court’s ruling was based on a violation of federal law.

Court’s Reasoning

The Court reasoned that under Ex parte Young, the Eleventh Amendment does not bar suits against state officials seeking prospective relief to end ongoing violations of federal law. The Court emphasized that the relief Giuliani sought was prospective because it would result in his ongoing entitlement to Medicaid benefits. The fact that Medicaid eligibility would be retroactive was incidental to the primary relief sought: the annulment of the fair hearing decision. The Court contrasted this with retrospective relief, which seeks to remedy a past violation.

The Court noted that attorney’s fees under 42 U.S.C. § 1988 are available where relief is sought on both state and federal grounds, but awarded only on state grounds if the constitutional claim is substantial and arises from a common nucleus of operative fact. However, in this case, it was unclear whether the Supreme Court based its decision on federal law, specifically 42 U.S.C. § 1396r-5(e)(2)(C). Because the Supreme Court did not make a determination that the Commissioner violated the specific statutory provision, the Court of Appeals could not conclude that Giuliani was a prevailing party on a federal claim for the purposes of awarding attorney’s fees.

The Court remitted the matter to Supreme Court to determine if DOH’s CSRA calculation violated federal law and whether Giuliani was entitled to attorney’s fees under section 1988.

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