Doe v. Colorado Department of Public Health and Environment

          City and County of Denver District Court No. 15CV30902 Honorable Morris B. Hoffman, Judge Honorable Jay S. Grant, Judge

          Hershey Decker Drake PLLC, Kari Hershey, C. Todd Drake, Carmen N. Decker, Lone Tree, Colorado, for Petitioners-Appellees and Cross-Appellants John Doe 1, John Doe 2, John Doe 3, John Doe 4, John Doe 5, John Doe 6, and John Doe 9

          Corry & Associates, Matthew W. Buck, Robert J. Corry, Denver, Colorado, for Petitioners-Appellees and Cross-Appellants John Doe 7 and John Doe 8

          Cynthia H. Coffman, Attorney General, Jennifer L. Weaver, First Assistant Attorney General, Corelle M. Spettigue, Senior Assistant Attorney General, Brian N. Morrow, Assistant Attorney General, Michael D. McMaster, Assistant Attorney General, Denver, Colorado, for Respondents-Appellants

          Cynthia H. Coffman, Attorney General, Eric Maxfield, First Assistant Attorney General, Sierra R. Ward, Assistant Attorney General, Denver, Colorado, for Cross-Appellee

          Cynthia H. Coffman, Attorney General, Natalie L. Powell, Assistant Solicitor General, Denver, Colorado, for Amicus Curiae Colorado Department of Regulatory Agencies in Support of Respondents-Appellants

          Cynthia H. Coffman, Attorney General, Emmy A. Langley, Assistant Solicitor General, Denver, Colorado, for Amici Curiae Colorado Department of Labor and Employment, Colorado Department of Local Affairs, Colorado Department of Personnel and Administration, Colorado Department of Health Care Policy and Financing, Colorado Department of Natural Resources, Colorado Department of Education, Colorado Department of Corrections, Colorado Department of Transportation, Colorado Department of Agriculture, and the Division of Criminal Justice Within the Colorado Department of Public Safety in Support of Respondents-Appellants

          OPINION

          DUNN JUDGE

         ¶ 1 The Colorado Department of Public Health and Environment; Larry Wolk, the Executive Director of the Department of Public Health and Environment; and Natalie Riggins, the State Registrar and Director of the Medical Marijuana Registry (collectively, Department), referred John Does 1-9 (Doctors) to the Colorado Medical Board (Board) for investigation of unprofessional conduct involving the Doctors' certification of patients for the use of medical marijuana.^[1] The Department based its referrals on its medical marijuana policy (Policy).^[2]

         ¶ 2 Concerned that the Department and the Board had secretly consulted with one another to enact the Policy, the Doctors brought this action against the Department and the Board alleging, as relevant here, violations of Colorado's Open Meetings Law (OML), §§ 24-6-401 to -402, C.R.S. 2017, and the State Administrative Procedure Act (APA), §§ 24-4-101 to -204, C.R.S. 2017. The district court dismissed the claims against the Board. But it granted summary judgment on the Doctors' OML and APA claims against the Department and, as a result, declared the Policy void.

         ¶ 3 Neither the Department nor the Doctors think the district court got it right. The Department asks us to reverse the summary judgment entered against it. And the Doctors challenge the dismissal of their claims against the Board along with the denial of their request for attorney fees and costs against the Department under the relevant provision of the Colorado Open Records Act (CORA), §§ 24-72-200.1 to -206, C.R.S. 2017. We affirm in part, reverse in part, and remand to the district court with directions to grant the Department's cross-motion for summary judgment and enter judgment in its favor.

         I. Background

         ¶ 4 The Colorado Constitution authorizes physicians to recommend the medical use of marijuana for patients with debilitating medical conditions. Colo. Const. art. XVIII, § 14(2)(c). And it provides that the Governor shall designate "the state health agency" responsible for creating and maintaining "a confidential registry of patients authorized to" use medical marijuana and "enact rules to administer" the program. Colo. Const. art. XVIII, § 14(1)(h), (7), (9); see also § 25-1.5-106(2)(f), C.R.S. 2017.

         A. The Department

         ¶ 5 Bill Owens, Colorado's then governor, designated the Department as "the state health agency" to administer Colorado's medical marijuana program. Exec. Order No. D 001 01 (Feb. 5, 2001), https://perma.cc/W9A9-6NZY; see also § 25-1.5-106(2)(f). In this capacity, the Department is required to promulgate rules governing certain aspects of the program. § 25-1.5-106(3)(a) (providing that the Department "shall . . . promulgate rules of administration"). In particular, it must promulgate rules to establish a confidential registry of patients who are entitled to receive medical marijuana cards. § 25-1.5-106(3)(a)(I). It must also promulgate rules concerning the conditions for issuing registry patients identification cards, which entails creating standards to ensure that patients have "a bona fide physician-patient relationship with a physician in good standing." § 25-1.5-106(3)(a)(V).

         ¶ 6 To develop and maintain a confidential patient registry, the Department created the medical marijuana program (also known as the medical marijuana registry). As described in the record, the program is headed by a manager and has staff members responsible for "the day-to-day administration and operational maintenance" of the patient registry. The program is part of the Department's Center for Health and Environmental Data Division.

         ¶ 7 The Department has discretion to refer a physician to the Board for "an investigation" if the Department "has reasonable cause to believe" that a physician violated the constitution, specified provisions of the medical marijuana statute, or certain rules promulgated under the Department's rulemaking authority. § 25-1.5-106(6)(a). The "determination" of whether a physician violated any such provision is for the Board. Id.

         B. The State Board of Health

         ¶ 8 Housed within the Department (and not a party to this case) is the state board of health. See § 25-1-108, C.R.S. 2017 (creating the state board of health); § 24-1-119(2), C.R.S 2017 (transferring the state board of health to the Department). Part of the state board of health's duties is to promulgate "rules and regulations . . . and to administer and enforce the public health laws of this state." § 25-1-108(1)(c)(I).

         ¶ 9 With this authority, the state board of health first promulgated rules related to the medical marijuana program in 2001. See generally Dep't of Pub. Health & Env't Regs., 5 Code Colo. Regs. 1006-2 (2001).^[3] In 2011, following its notice of proposed rulemaking and public hearings, it adopted a rule explaining, among other things, what qualifies as a "[b]ona fide physician-patient relationship." Dep't of Pub. Health & Env't Reg. 8(A)(2), 5 Code Colo. Regs. 1006-2; see also § 25-1.5-106(3)(a)(V). Specifically, the rule provides that physicians must complete full assessments of a patient's medical history, consult with patients about their debilitating or disabling medical condition before the patient applies for a medical marijuana card, and provide follow-up care and treatment to the patient. Dep't of Pub. Health & Env't Reg. 8(A)(2)(a), 5 Code Colo. Regs. 1006-2. The rule authorizes the Department to refer physicians who do not comply with these qualifications to the Board. Dep't of Pub. Health & Env't Reg. 8(B), 5 Code Colo. Regs. 1006-2.

         C. The Board

         ¶ 10 The Board is entirely separate from the Department. It is housed under the Department of Regulatory Agencies. § 24-1- 122(2)(g), C.R.S. 2017. And its organic statute is the Colorado Medical Practice Act. § 12-36-103(1)(a)(I), C.R.S. 2017. The Board is authorized to investigate allegations of "unprofessional conduct" against physicians. See § 12-36-117, C.R.S. 2017; see also § 12-36-118, C.R.S. 2017 (describing the process for investigating complaints and formal hearings). This authorization allows the Board to issue subpoenas, "[m]ake investigations, hold hearings, and take evidence." § 12-36-104(1)(b)(I), C.R.S. 2017. If the Board's hearing panel "finds the charges proven," it may "determine the extent" of any "discipline [to] be imposed." § 12-36-118(5)(g)(III).

         D. The Policy

         ¶ 11 In 2013, the Colorado State Auditor conducted a performance audit and issued "findings and recommendations related to Colorado's medical marijuana regulatory system." The audit raised concerns "over access to medical marijuana" by an increasing number of unqualified patients. The Auditor found evidence that some physicians "may be making inappropriate recommendations" for the medical use of marijuana and that the Department was "not sufficiently oversee[ing] physicians who make medical marijuana recommendations." Recognizing the Department's authority to refer physicians to the Board, the Auditor recommended that the Department and the Board work together to determine risk factors and "establish guidelines for initiating investigation[s] of physicians or making physician referrals to the Board for further investigation."

         ¶ 12 Consistent with these recommendations, some Department employees and some Board employees exchanged a series of emails, ^[4] had a handful of private meetings, and participated in telephone calls to develop criteria for the Department to use to refer physicians to the Board for further investigation.^[5] Though the record does not reflect exactly how or when it happened, these discussions apparently culminated in the Policy.^[6]

         ¶ 13 The Policy provides for the medical marijuana program to identify physicians who exceed a specific (1) number of patients for whom medical marijuana is recommended; (2) amount of marijuana recommended; and (3) number of patients in a set age group for whom medical marijuana is recommended. If a physician exceeds one of the criteria, the Policy states that the physician "may be recommended for referral" to the Board. The Policy also provides that the Medical Marijuana Program Director "in consultation with the Chief Medical Officer or Deputy Chief Medical Officer" will review physician referral recommendations and will "issue a formal referral to the" Board if the evidence supports it.

         ¶ 14 The Department, through Mr. Wolk, referred the Doctors to the Board under the Policy. The Board began an investigation, notifying the Doctors that it had received information regarding "a possible violation of the Medical Practice Act," it had "received a complaint" from "the [Department] related to your medical marijuana recommendations," "no assumption [had] been made about the truth or validity of any information provided to the Board," and it was "required by law to investigate the complaint."

         ¶ 15 The Doctors then made CORA requests to the Department and the Board asking them to produce public records, including policies, rules, protocols, and guidelines related to standards for referring physicians to the Board.

         E. The Lawsuit

         ¶ 16 After receiving some documents responsive to its CORA requests, the Doctors filed this action, seeking declaratory and injunctive relief.

         ¶ 17 The Board and the Department filed motions to dismiss for failure to state a claim. Agreeing with the Board that the Policy was the Department's - not the Board's - the district court dismissed the Doctors' claims against the Board. And it concluded that if the Policy was "ultimately declared void, any injunctive relief" would be directed to the Department.

         ¶ 18 But the court denied the Department's motion, questioning whether the Policy was a "rule of administration concerning implementation of the medical marijuana program." See § 25-1.5-106(3)(a). It ultimately determined that the answer "may well be a mixed question of law and fact," and declined to answer the question at that stage of the briefing.

         ¶ 19 The Department and the Doctors later filed cross-motions for summary judgment. The district court granted summary judgment for the Doctors on their APA and OML claims, determining that the Department was the "agency responsible for promulgating rules setting reasonable cause standards for referral of physicians to the . . . Board." The court concluded that the Department's referrals qualified as a "final agency action," and because the Department adopted the Policy without providing public notice of its meetings or opening the meetings to the public, the court determined that the "promulgation and implementation of [the] Policy . . . was in violation of the [OML] and that [the] Policy [was], therefore, invalid."

         ¶ 20 The court ordered the Department to "immediately cease and desist from enforcing [the] Policy," but it rejected the Doctors' request to "halt any investigations that were initiated as a result of those referrals." The court awarded the Doctors their reasonable attorney fees and costs under the OML. But it denied fees and costs related to the Department's response to the Doctors' CORA request.

         II. OML

         ¶ 21 The Department argues the district court erred in granting summary judgment on the Doctors' OML claims against it. The Doctors disagree and additionally contend the court erred in dismissing their OML claim against the Board.

         A. Standing

         ¶ 22 We do not agree with the Department's opening salvo that the Doctors lack standing to bring their OML claims.

         ¶ 23 Standing requires a showing of an injury in fact to a legally protected interest. Ainscough v. Owens, 90 P.3d 851, 855 (Colo. 2004). The OML itself creates a "legally protected interest on behalf of Colorado citizens in having public bodies conduct public business openly in conformity with its provisions." Weisfield v. City of Arvada, 2015 COA 43, ¶ 22; see also § 24-6-402(9)(b), C.R.S. 2017 (Courts "have jurisdiction to issue injunctions to enforce [the OML] upon application by any citizen of this state.").

         ¶ 24 And the Doctors alleged an injury in fact under the OML. Namely, they alleged that the Department violated the OML by adopting the Policy in secret and without public input and that they were referred to the Board for further investigation under the secret Policy. That is enough for standing under the OML. See Weisfield, ¶ 28 (concluding that a district resident had ...