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Alden Management, Services, Inc. v. Chao

October 23, 2007

ALDEN MANAGEMENT, SERVICES, INC.,
v.
ELAINE CHAO, SECRETARY OF LABOR, UNITED STATES DEPARTMENT OF LABOR; AND UNITED STATES DEPARTMENT OF LABOR.



The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge

MEMORANDUM OPINION AND ORDER

Before the Court is Plaintiff Alden Management Services' ("Alden") Motion for Summary Judgment and Defendants the Secretary of Labor's and the United States Department of Labor's (collectively "the DOL") Cross-Motion for Summary Judgment. For the reasons below, the Court denies Plaintiff's Motion for Summary Judgment and grants Defendants' Cross-Motion.

BACKGROUND

I. Statutory Scheme

This case concerns the Immigration Nursing Relief Act of 1989 ("INRA"), 8 U.S.C. § 1101 et seq., and regulations promulgated by the DOL pursuant to that statutory scheme. The INRA, which was enacted as an amendment to the Immigration and Nationality Act, created an admission program ("the H-1A program") for foreign nurses to alleviate a national shortage of registered nurses in the United States. See Beverly Enters. v. Herman, 119 F. Supp. 2d 1, 2 (D.D.C. 2000)(citing legislative history of the INRA). The H-1A program allowed qualified registered nurses from foreign countries to come to the United States to work as non-immigrant aliens for a period of up to five years, so long as certain "attestation" conditions were met. See id.;8 U.S.C. § 1101(a)(15)(H)(i)(a); id. § 1182(m)(2)(A). Under this framework, a facility that wanted to employ alien nurses had to attest to a number of conditions, including that: (1) the employment of the alien would not adversely affect the wages and working conditions of registered nurses already employed at the facility; and (2) the facility would pay the alien the wage rate for registered nurses similarly employed by the facility. See id. § 1182(m)(2)(A)(ii), (iii).

The statute authorized the DOL to promulgate regulations to carry out the INRA. See id. § 1182(m); Beverly Enters. v. Herman, 50 F. Supp. 2d 7, 10 (D.D.C. 1999).

II. Undisputed Facts

Alden Management Services, Inc. ("Alden") is an Illinois corporation that provides health-care management services to seven nursing homes in the Chicago area. (R. 46-1, Def's Resp. To Pl's Local Rule 56.1 Statement of Material Facts, at ¶ 1.) Among other services, Alden provides financial services and support, regulatory support, risk management services, nursing and dietary support, and assistance in employment matters to nursing homes. (R. 52-1, Pl's Resp. To Def's Local Rule 56.1 Statement of Material Facts, at ¶ 4.) Alden owns five of the seven affiliated nursing homes to which it provides services. (Id.)

During the time period from 1992 to 1995, Alden filed "attestations" with the appropriate authorities seeking to hire foreign nationals from the Philippines as registered nurses to work at nursing homes in Illinois.(Id. at ¶ 5.) The seven Alden affiliated nursing homes eventually employed 119 nurses from the Philippines. (Id. at ¶¶ 5-6; R. 46-1, at ¶ 7.) The nursing homes employed the nurses variously as certified nurse aids ("CNAs") and registered nurses license pending ("RNLPs") and paid them a lower wage rate than that of a registered nurse. (Id. at 6.)

In April 1995, the United States Department of State ("State Department") sent the DOL a telegram indicating that an alleged agent of Alden had offered a potentially improper payment to a consular official in the Philippines. (R. 46-1, at ¶ 11.)The telegram further alleged that: (1) one of the nurses had entered the United States pursuant to Alden's attestation but discovered that no position was available upon her arrival; (2) the consular official had phoned several of Alden's affiliated facilities and learned that no nursing shortages existed at those facilities at the time of the telephone call; and (3) certain nursing registries may have filed attestations but paid the nurses for less than full time employment. (Id. at ¶¶ 12-14.) The telegram also stated that "Alden issued employment contracts with vague and non-specific wording." (ALD 002385.) Thereafter, the DOL launched an investigation into whether Alden failed to pay the 119 nurses the appropriate wages, as prescribed by the INRA. (Id. at ¶ 16.)

III. Procedural History

This case comes before the Court following lengthy administrative procedures. On April 3, 1996, the DOL issued a Determination Letter finding that Alden had violated the INRA. (Id. at ¶ 16.) The Determination Letter concluded that Alden's hiring, employment, and compensation of non-immigrant nurses under the H-1A program, including its failure to pay foreign nurses at the wage rate paid to other similarly employed registered nurses, violated the INRA. (Id.) Alden requested a hearing before an Administrative Law Judge ("ALJ"), and the ALJ eventually issued a decision dated November 19, 1999, reducing the damages assessed against Alden but affirming the findings that Alden had violated the INRA. (Id. at ¶¶ 20-23.)

A. The Administrative Review Board

Alden and the DOL petitioned for review of the ALJ's decision by the DOL's Administrative Review Board ("ARB"), and on August 30, 2002, the ARB affirmed the ALJ on liability, but reversed the ALJ's conclusion that the period for calculating back pay was limited to one year. (Id. at ¶¶ 24-25.) The ARB held that Alden was liable for back pay for the entirety of the period during which the 119 nurses worked at Alden, and it remanded the matter to the ALJ for the purpose of calculating back pay consistent with the ARB's order. (Id. at ¶¶ 24-28.)

On December 20, 2005, the ALJ issued its Decision and Opinion on Remand in which it accepted several stipulations submitted by the parties on the amount of back pay owed, and ordered Alden to pay $1,041,823.90 in back pay and a $40,000 civil penalty. (Id. at ¶ 30.) Alden filed its Complaint with this Court on March 8, 2006, seeking judicial review of the agency's decision pursuant to the Administrative Procedure Act, 5 U.S.C. §§ 701-706. Alden now brings this Motion for Summary Judgment pursuant to Federal Rule of Civil Procedure 56, seeking reversal or substantial modification of the final agency actions.

B. The ARB's August 30, 2002 Decision

Alden argues that the ARB erred in each of the following holdings. First, the ARB held that the State Department is an "aggrieved person or organization" under the INRA. (R. 15-3, ARB August 30, 2002 Decision and Order of Remand, at page 1.) Second, the ARB held that Alden is a "facility" as defined by the INRA and its supporting regulations. Id. Third, the ARB held that the DOL had reasonable cause to investigate Alden's activities. Id. Fourth, the ARB upheld the ALJ's decision that the DOL has the authority to conduct "directed investigations." Id.Finally, the ARB reversed the ALJ's decision and held that the period for calculating back pay wages is not limited to one year.Id. at pages 1-2.

LEGAL STANDARD

Summary judgment is proper where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). In determining whether a genuine issue of material fact exists, the court must construe all facts in the light most favorable to the non-moving party and draw all reasonable and justifiable inferences in that party's favor. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). When presented with cross-motions for summary judgment, the court considers the motions simultaneously and draws ...


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