The opinion of the court was delivered by: Wm. R. Wilson, Jr. United States District Judge
Pending is Plaintiffs' Motion for a Temporary Restraining Order.*fn1 In response, Defendants filed a Motion to Dismiss,*fn2 to which Plaintiffs responded.*fn3 Also pending is Defendants' Motion for Reconsideration.*fn4
A conference was held March 5, 2007 on the motions cited above. At the end of the conference, the parties were given an opportunity to file supplemental briefs, but no such briefs were filed.
Plaintiffs, Dr. Cullom ("Cullom") and his clinic, Cullom P.A. ("the Clinic") sued Defendants, the Arkansas Department of Health and Human Services ("ADHHS"), Centers for Medicaid and Medicare Services ("CMS"), and Molly Crawshaw ("Crawshaw") under 42 U.S.C. § 1983. He is seeking declaratory relief, injunctive relief, and damages. Based on an agreement of the parties, the ADHHS was removed from the case, and the United States and CMS were substituted as the real parties in interest.*fn5
Cullom is an Arkansas physician who is a qualified provider of Medicaid and Medicare services. An important part of his patient care is laboratory testing, which is operated by the Clinic. This action began after state and federal officials determined that the Clinic's laboratory did not comply with federal law.
All laboratory examination must be certified by the Secretary of Health and Human Services under the Clinical Laboratory Improvement Act ("CLIA").*fn6 The federal Department of Health and Human Services issued regulations for CLIA certification.*fn7 The ADHHS conducts surveys for certification under the supervision of CMS.
In August 2005, ADHHS conducted a recertification survey of the Clinic. The survey revealed deficiencies, and, as a result, the ADHHS informed Cullom that the Clinic's certification would be suspended unless remedial steps were taken.*fn8 Before Cullom was given an opportunity to correct the errors, and before he was given a hearing, CMS stepped in and suspended the Clinic's license.*fn9
In response, Cullom filed an administrative appeal.
While the appeal was pending, Cullom and CMS settled the dispute. Under the terms of the settlement, Cullom agreed to implement all recertification recommendations. He was given three to six months to establish compliance.*fn10 According to Cullom, he did everything that was required to regain his certification. Despite his efforts, an officer with the CLIA Health Facility Services conducted a second survey and, again, denied recertification.
Plaintiffs maintain that CMS, Crawshaw, and the United States are guilty of the following misconduct: (1) they breached the settlement agreement with Collum; (2) they breached a duty of good faith by agreeing to a settlement without any intention of complying with their end of the bargain to recertify the Clinic's lab; (3) they failed to consider the federal regulation's requirements before suspending the certification; and (4) they violated Cullom's right to substantive and procedural due process by arbitrarily suspending certification.
Defendants assert that Plaintiffs' claims should be dismissed for lack of jurisdiction based on the following: (1) they cannot bring a 42 U.S.C. § 1983 claim against the federal government, its agencies or officials; (2) their claims for damages are barred by the Eleventh Amendment to the Constitution; (3) Congress has provided an adequate remedy for their complaints; (4) they failed to exhaust the procedural remedy provided by the CLIA and its regulations.
When ruling on a motion to dismiss under Rule 12(b)(6), a plaintiff's well-pleaded factual allegations must be taken as true.*fn11 A motion to dismiss should not be granted unless it appears beyond doubt that a plaintiff can prove no set of facts in support of his claim that would entitle him to relief.*fn12 The complaint must contain facts, not conclusions, ...