In Doe v. BJC Health Sys., No. 23-1107 (8th Cir. Dec. 28, 2023), the Eighth Circuit – rejecting the persuasive authority of two district court opinions – holds that a hospital’s adoption of a online patient portal under the 2009 Health Information Technology for Economic and Clinical Health (HITECH) Act did not bring a state-law privacy case within the federal officer removal statute, 28 U.S.C. § 1442(a)(1).
“In 2009, Congress enacted the Health Information Technology for Economic and Clinical Health (HITECH) Act. The Act established an Office of the National Coordinator for Health Information Technology (Coordinator) within HHS. 42 U.S.C. § 300jj-11(a). The Act tasked the Coordinator ‘with the development of a nationwide health information technology infrastructure that allows for the electronic use and exchange of information.’ Id. § 300jj-11(b) . . . . Relevant here, the Act authorizes HHS to make ‘incentive payments’ to healthcare providers for their ‘adoption and meaningful use of certified EHR technology.’ 42 U.S.C. §§ 1395w-4(o), 1395ww(n); see also 42 C.F.R. §§ 495.2.370.”
Under the aegis of this federal statutory framework, defendant “BJC created an online portal for its patients. The portal was initially called MyBJCHealth and renamed MyChart in 2017. The portal allows BJC patients to go online and access EHRs, such as medical test results, and communicate with BJC personnel, such as physicians and nurses. HHS gave BJC incentive payments for creating and operating this portal.”
In 2022, plaintiffs filed this putative class action in Missouri state court alleging that “BJC shared their protected health information (PHI) with third-party marketing services in violation of Missouri law . . . . Specifically, plaintiffs allege that, when patients visited MyBJCHealth or MyChart, the portal shared their PHI with third-party services, including Alphabet (Google) and Meta Platforms (Facebook), which used the information for targeted online advertising.”
BJC removed the case to federal court under the federal officer removal statute, 28 U.S.C. § 1442(a)(1), on the theory that “when it created and operated the portal, it acted under HHS’s or the Coordinator’s authority.” The plaintiffs moved for remand to Missouri state court, which the district court granted.
The Eighth Circuit affirms. The federal officer removal statute, 28 U.S.C. § 1442(a), “ provides the federal government, federal agencies, federal officers, and persons ‘acting under’ federal officers the right to remove from state court to federal court certain civil actions and criminal prosecutions brought against them. Id. The statute is ‘an incident of federal supremacy.’”
Because BJC is not itself a federal agency or officer, it adverted instead to a test for those acting under the authority of a federal officer. Such a defendant must show that “(1) it is a ‘person’ under the statute, (2) it ‘acted under the direction of a federal officer,’ (3) a ‘causal connection’ exists between its complained-of conduct and official federal authority, and (4) it has a ‘colorable federal defense’ to the claim or claims against it.” It claimed that by operating MyChart and accepting federal incentive payments, it “acted under the direction of HHS or the Coordinator.”
The Eighth Circuit holds that BJC was not “acting under” federal authority within the meaning of the federal officer removal statute. Under Eighth Circuit authority, “a party acts under a federal officer, within the meaning of the federal officer removal statute, only when it performs a ‘basic governmental task[]’ . . . . In other words, the party acts on the government’s behalf . . . . The party does the business of the federal government and not merely its own.”
BJC argued within the above rubric that “it exercised explicit or implied authority delegated from HHS or the Coordinator when it created and operated its online patient portal—MyBJCHealth or MyChart.” It cited district court cases from Ohio and Pennsylvania that reached that conclusion. But the Eighth Circuit finds these cases unpersuasive. “To show that it acted under a federal officer as a government contractor, a party seeking removal must have ‘provided the government with a product that it needed or performed a job that the government would otherwise have to perform’ . . . . Parties who act as government middlemen and deliver federal benefits to federal beneficiaries will usually be able to make this showing.”
“The line between a party who acts as a government middleman and a party who accepts federal funding for its own business purposes may sometimes be blurry. Wherever the line may lie, BJC clearly sits on the private side. MyBJCHealth or MyChart was not a federal government website, it was not a website BJC operated on the federal government’s behalf or for the federal government’s benefit, and it was not a website the federal government directed BJC to create or operate. The design of private websites is not—and has never been—a basic governmental task. When BJC created and operated an online portal for its patients, it was not doing the federal government’s business. It was doing its own.”
The panel also rejects the theory of implied delegated authority. It notes a circuit split on this issue: “This circuit has not adopted the view of the Third, Fifth, and Eleventh Circuits that an implied delegation can establish a basis for federal officer removal. But even if we accepted this theory today, we do not believe BJC would qualify. Our sister circuits have emphasized that an implied delegation exists when a private party functions in practice as an ‘instrumentalit[y] of the United States’ . . . . Here, there is no indication that BJC practically functioned as a federal instrumentality or that its patients ever believed they were dealing with an entity acting in place of the federal government. The creation and operation of an online patient portal is not ‘a public function’ that the federal government tacitly allowed BJC to perform on its behalf . . . . MyBJCHealth or MyChart was simply a private website, whose existence has served (or perhaps violated) the interests of BJC, its personnel, and its patients.”
“In sum, the creation and operation of an online patient portal is not a basic governmental task. When BJC created and operated MyBJCHealth or MyChart, it did not act pursuant to an explicit or implied ‘delegation of legal authority’ from HHS, the Coordinator, or any other federal officer.”
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