[00:00:00] Speaker 04:
The next case for argument is 17-1460, Folcher v. Secretary of Veterans Affairs, Mr. Schoenfeld.

[00:00:07] Speaker 04:
Good morning.

[00:00:09] Speaker 02:
Good morning, Your Honor.

[00:00:18] Speaker 02:
May it please the Court, Alan Schoenfeld, counsel for Petitioners.

[00:00:22] Speaker 02:
After doing all the work necessary to institute the request of rulemaking, including preparing a draft notice of proposed rulemaking and conducting the financial impact analysis, the VA notified Congress that it was abandoning the project and that rulemaking was not imminent.

[00:00:37] Speaker 02:
That was nearly two years ago.

[00:00:38] Speaker 02:
The agency has done nothing in the meantime, and yet it argues before this court both that it has not denied the petition and that any decision it has reached with respect to the petition is not final.

[00:00:48] Speaker 04:
Now, you filed this eight months in.

[00:00:52] Speaker 04:
And now, as you say, we're about two years in.

[00:00:55] Speaker 02:
The petition for review of this court.

[00:00:56] Speaker 04:
Right.

[00:00:57] Speaker 04:
Right.

[00:00:58] Speaker 04:
Are you aware of any case where passage of eight months or less than two years has warranted the, or has concluded that it was an unreasonable delay by the agency?

[00:01:13] Speaker 02:
So the answer is yes.

[00:01:15] Speaker 02:
I would point to Families for Freedom, which was a two-year delay.

[00:01:19] Speaker 02:
I think, I just want to make two points.

[00:01:22] Speaker 02:
The first one is we think that the petition has been denied.

[00:01:25] Speaker 02:
And so the track delay consideration is a... No, I understand that.

[00:01:29] Speaker 02:
And also, I think the relevant time period is between the filing of the petition for rulemaking and today.

[00:01:35] Speaker 02:
The question is a practical one.

[00:01:38] Speaker 02:
How long has the agency delayed ruling on the petition?

[00:01:41] Speaker 02:
So if the court concludes that the November 2016 letter was not itself a denial, I think the relevant inquiry is,

[00:01:46] Speaker 02:
has the two years that intervened between our filing the petition and today constituted an unreasonable delay in time.

[00:01:52] Speaker 02:
And certainly under the track factors, the delay itself is only one of six factors.

[00:01:57] Speaker 02:
And the other factors think all way in favor of this court finding, if it finds that it was not in fact denied, that it has been denied in effect by the passage of this long period of time.

[00:02:07] Speaker 03:
Do you think all of the factors weigh in favor?

[00:02:10] Speaker 03:
I mean, this is one in which, to put it probably too simply,

[00:02:14] Speaker 03:
Health is on both sides of the balance to the extent that there's a question of resource constraint and priorities.

[00:02:25] Speaker 02:
I don't think that's right, Your Honor.

[00:02:27] Speaker 02:
I think that the agency has reached the conclusion that sex reassignment surgery is medically necessary in certain cases, and removing the exclusion.

[00:02:35] Speaker 03:
The agency has really?

[00:02:37] Speaker 02:
The VA.

[00:02:38] Speaker 02:
How is that?

[00:02:39] Speaker 02:
Notice a proposed rulemaking, which reflects the view of the agency, and in fact, the letter from the VA.

[00:02:44] Speaker 03:
All we have in this is an unsigned, undated draft of a notice of proposed rulemaking, not adopted by who I assume the secretary is the only one with actual statutory authority.

[00:02:57] Speaker 02:
I think that's right.

[00:02:58] Speaker 02:
I would point to the letter from the undersecretary for health, then undersecretary Shulkin, speaking explicitly on behalf of the department, recognizing the agency's condition.

[00:03:08] Speaker 03:
This is that probably garbled sentence that must mean that, even though it doesn't

[00:03:14] Speaker 03:
quite say that.

[00:03:16] Speaker 02:
I think it's earlier where the agency says... What are you looking at?

[00:03:21] Speaker 02:
Increased understanding of both gender dysphoria... I'm sorry, pay... It's the letter, it's either one... Right, that sentence is garbled, but I think it does mean what you say.

[00:03:30] Speaker 02:
So what it says, speaking on behalf of the department, is increased understanding of both gender dysphoria and surgical techniques in this area has improved significantly

[00:03:39] Speaker 02:
and is now widely accepted as medically necessary.

[00:03:42] Speaker 02:
Right.

[00:03:42] Speaker 03:
I just mean it's not the increased understanding that's now widely accepted.

[00:03:47] Speaker 02:
It is widely accepted that sex reassignment surgery is medically necessary in particular cases.

[00:03:51] Speaker 03:
Right.

[00:03:52] Speaker 03:
So can I ask you this question?

[00:03:57] Speaker 03:
Sure.

[00:03:58] Speaker 03:
Here's a scenario, and there may be pieces of it.

[00:04:00] Speaker 03:
But suppose I weren't quite sure whether the November letter was a denial or not.

[00:04:07] Speaker 03:
Suppose I thought it was a denial.

[00:04:09] Speaker 03:
but that the right remedy for that would be what the government says, which is a remand for an explanation of the denial.

[00:04:19] Speaker 03:
Suppose I also thought that they have not really given much of an explanation for the period of time that has elapsed since the request and say today.

[00:04:29] Speaker 03:
And in either event, the remedy would be remand for

[00:04:36] Speaker 03:
an explanation.

[00:04:37] Speaker 03:
Either we have denied it and here's the reasons that we've denied it or we haven't really denied it or are not now denying it, but we need more time.

[00:04:48] Speaker 03:
Doesn't that amount to the same thing, a remand for the VA to speak with considerably more clarity than it has yet done about this issue?

[00:05:03] Speaker 03:
without even deciding whether the delay is unreasonable because we haven't.

[00:05:08] Speaker 03:
There's that one sentence which you highlight, I think, in your reply brief, one sentence in the red brief that says the reason for the delay is that we're still thinking about it, which doesn't say why it's taking so long.

[00:05:18] Speaker 02:
That's certainly right.

[00:05:20] Speaker 02:
I think the case law has been clear that this court does not defer blindly to an agency's delay justification.

[00:05:30] Speaker 02:
You need to inquire as to why it's happening.

[00:05:32] Speaker 02:
But to answer your question more directly, I do think it is correct that if you were to remand to the agency to offer its reasoned explanation for its activity with respect to the petition under the denial case or under the track case,

[00:05:49] Speaker 02:
That remedy would be the same.

[00:05:51] Speaker 02:
I don't see a meaningful distinction between the two forms of remedy.

[00:05:55] Speaker 03:
But you've asked for a stronger remedy.

[00:05:57] Speaker 03:
Correct.

[00:05:58] Speaker 03:
They've denied it, forced them to institute.

[00:06:00] Speaker 03:
Absolutely.

[00:06:01] Speaker 03:
Or whatever.

[00:06:01] Speaker 02:
Yeah.

[00:06:02] Speaker 02:
The remedy we would prefer here is for this court to order them to undertake the rulemaking that they've proposed.

[00:06:07] Speaker 02:
And we think that recognizing that remand is the ordinary rule in cases where the agency hasn't considered the issue.

[00:06:13] Speaker 02:
Here, the agency has considered the issue.

[00:06:15] Speaker 02:
the notice of proposed rulemaking, recognizing all the faults your honor has wanted to.

[00:06:18] Speaker 03:
Right, this term, the agency, is a, I guess maybe I'm improperly, but anyway, I'm a little bit stuck on what that means.

[00:06:28] Speaker 03:
The secretary is the one with the authority and there's no secretary sign off on whatever that spring 2016 notice is.

[00:06:35] Speaker 02:
There is no requirement under the APA that it be final secretary authority.

[00:06:39] Speaker 02:
It's final agency action.

[00:06:41] Speaker 02:
And here you have agency action.

[00:06:43] Speaker 02:
The agency has assembled a record which demonstrates its consideration of the petition for rulemaking and included in there is a notice of proposed rulemaking signed off by staff members within the agency who have indicated we have deliberated upon all the information.

[00:06:57] Speaker 02:
And this is the rulemaking we proposed to answer to.

[00:06:59] Speaker 01:
But it was withdrawn before it was published, right?

[00:07:01] Speaker 01:
That's correct.

[00:07:02] Speaker 01:
Agency generally under the APA entitled to go through all the steps up to and including the proposal and still change their mind at the last minute without subjecting it to APA review.

[00:07:14] Speaker 02:
I don't think that's correct, Your Honor.

[00:07:15] Speaker 02:
The question before the court on a petition for rulemaking where it's been denied is, are there objective practical indicia that the petition has actually been denied?

[00:07:24] Speaker 02:
If they had withdrawn the notice of proposed rulemaking, but there was no petition for rulemaking,

[00:07:30] Speaker 02:
I wouldn't say that that action standing alone would be subject to final agency review.

[00:07:34] Speaker 02:
The question before this court is, what is the final agency action with respect to the petition for rulemaking?

[00:07:40] Speaker 02:
Has the agency denied it?

[00:07:42] Speaker 02:
The agency has communicated to members of Congress that further activity with respect to this subject matter is not imminent.

[00:07:49] Speaker 02:
The question before this court, as the D.C.

[00:07:50] Speaker 02:
Circuit put it in Seba Gage is, is the agency at rest with respect to this issue?

[00:07:56] Speaker 02:
And it is.

[00:07:57] Speaker 03:
All of them.

[00:07:59] Speaker 03:
Suppose there were a kind of, in another case, an agency, say EPA, says we've got this issue before us about some petition for us to declare some level of some chemical to be improper under some relevant statute.

[00:08:22] Speaker 03:
And the agency says,

[00:08:24] Speaker 03:
Action is not imminent because actually this is going to take years for us to get a reliable determination, the scientific part, the economic balance.

[00:08:35] Speaker 03:
Not imminent doesn't quite mean at rest.

[00:08:39] Speaker 02:
In that case, because the agency has given a reasoned explanation for why it's not imminent and it has intimated that it will take action once it collects the requisite scientific data, I think that the indicia of finality are lacking.

[00:08:52] Speaker 02:
Here, the record that the agency itself assembled says, we have deliberated upon all the information.

[00:08:59] Speaker 02:
We recognize that a factual predicate of our 1999 rulemaking is no longer valid.

[00:09:04] Speaker 01:
The difficulty I have with relying on that proposed rulemaking is you're somehow incorporating that into these letters to Congress to suggest that that's the part of all of the records.

[00:09:17] Speaker 01:
But I'm not sure their letter to Congress necessarily relies on any of that.

[00:09:23] Speaker 02:
Even if the court were to look only at the letter to Congress, I think there is sufficient indicia of finality to find that that reflects a denial.

[00:09:30] Speaker 02:
It is from a person charged with authority by the agency, the undersecretary of health, speaking explicitly for the department, communicating in official correspondence with 47 members of Congress with respect to their inquiries on the notice of proposed rulemaking, specifically with respect to that notice of proposed rulemaking, indicating to Congress that further activity on that notice of proposed rulemaking is not imminent.

[00:09:54] Speaker 02:
That's the letter standing on its own.

[00:09:56] Speaker 02:
That to me, and under the case law, is sufficient indicia of finality.

[00:10:01] Speaker 02:
In the intervening 18 months, the agency has taken no action with respect to this issue.

[00:10:07] Speaker 02:
There is nothing in the record that the agency points to.

[00:10:09] Speaker 02:
They filed their brief in November of 2017.

[00:10:11] Speaker 02:
The only activity with respect to this petition for rulemaking that they point to predates their sending of the November 10th, 2016 letter to Congress.

[00:10:20] Speaker 01:
Can I ask you a completely different question?

[00:10:23] Speaker 01:
You've corralled a pretty impressive number of amici briefs.

[00:10:28] Speaker 01:
All of them seem to suggest that this is medically necessary.

[00:10:32] Speaker 01:
It seems to be the consensus of the medical profession.

[00:10:35] Speaker 01:
Are you aware of any opposing views from well-established medical organizations?

[00:10:41] Speaker 01:
No.

[00:10:44] Speaker 01:
Are you aware of how

[00:10:45] Speaker 01:
This is dealt with in private insurance companies.

[00:10:48] Speaker 01:
Are private insurance companies generally covering these procedures or not?

[00:10:51] Speaker 02:
They are increasingly covering these procedures.

[00:10:53] Speaker 02:
I don't know how the market hashes out, but it is commonplace for private insurers to cover this.

[00:10:58] Speaker 01:
And what about Medicaid?

[00:11:01] Speaker 02:
Medicaid, there's a national coverage determination in the Medicaid program covering sex reassignment surgery in medically necessary cases.

[00:11:08] Speaker 02:
And Medicare?

[00:11:10] Speaker 02:
I don't know the answer to that.

[00:11:11] Speaker 04:
And what about, you cite in one of the briefs where you talk about this, the federal health program, and you cite to this, I don't know if you have it in the record, but you cite to notice that OPM put out in the end of 2015 stating covered benefits for gender transition services effective January 2016, no carrier,

[00:11:37] Speaker 04:
may have a general exclusion of services, drugs, or supplies related to gender transition or gender transformation.

[00:11:44] Speaker 04:
Is your read that that clearly covers sex assignment surgery requires covering?

[00:11:49] Speaker 04:
And that's because it says you may have, you can't have a general exclusion of services.

[00:11:58] Speaker 04:
So the issue is... Because here they do provide some... Under the VA program that you're challenging, they do allow for some services, they just exclude sex transformations.

[00:12:07] Speaker 02:
I understand the point.

[00:12:09] Speaker 02:
The way I read that carrier letter is to say, you may not have a categorical exclusion for any of these services that may be recognized as medically necessary in a particular case.

[00:12:19] Speaker 02:
So what the regulation does is it says no matter the medical needs,

[00:12:23] Speaker 02:
The VA may not provide itself or through its network of providers, sex reassignment surgery, no matter the medical need as determined by VA clinicians.

[00:12:32] Speaker 02:
What the notice of proposed rulemaking would have done is it proposed a rule under which sex reassignment surgery is available in cases where VA clinicians determine that in a particular case, sex reassignment surgery is medically necessary because other interventions

[00:12:48] Speaker 02:
hormone therapy, psychotherapy, whatever else are insufficient to cure gender dysphoria.

[00:12:53] Speaker 02:
To be clear, the substance of the rulemaking that might eventually from this process is not before this court.

[00:12:59] Speaker 02:
We obviously have our views about what we think is constitutionally required and what's mandated by section 1710.

[00:13:04] Speaker 03:
Can I ask you, would it be proper for the agency not to issue a notice of a proposed rule

[00:13:16] Speaker 03:
the content of which is to eliminate the exclusion, the C, whatever exclusion is, but something essentially neutral.

[00:13:24] Speaker 03:
That is, we're considering keeping it, we're considering eliminating it.

[00:13:31] Speaker 03:
We now go through a comment period without saying our initial view is one way or the other, whether by advance notice of proposed rulemaking,

[00:13:42] Speaker 03:
or by some other mechanism.

[00:13:44] Speaker 02:
I think that's certainly within the agency's discretion.

[00:13:47] Speaker 02:
The opportunity for rulemaking, simply an opportunity for the agency to gather information, gather public comment, it's the democratic part of the rulemaking process.

[00:13:57] Speaker 02:
The agency doesn't have to put a thumb on the scale one way or the other.

[00:14:00] Speaker 02:
But our view is that what the record reflects is that the agency has reached the conclusion that this is an important issue worthy of initiating a rulemaking process.

[00:14:10] Speaker 02:
The DC Circuit has repeatedly recognized.

[00:14:12] Speaker 02:
I understand this is not the DC Circuit, but the APA case law is more comprehensive there.

[00:14:16] Speaker 02:
The DC Circuit has repeatedly recognized in WWHT and NRDC versus the SEC where an agency recognizes the importance of the issue and makes clear its view that the issue is worthy of rulemaking

[00:14:30] Speaker 02:
Rulemaking needs to happen.

[00:14:32] Speaker 02:
There's no thumb on the scale from the court.

[00:14:34] Speaker 02:
There's no interference by the court in the rulemaking process.

[00:14:37] Speaker 03:
What kind of considerations, if any, would you think is reasonable even if you would argue against them of a sort?

[00:14:49] Speaker 03:
We have other priorities.

[00:14:50] Speaker 03:
Our agency is struggling with all kinds of issues.

[00:14:55] Speaker 03:
The process of doing a rulemaking on this would be

[00:15:00] Speaker 03:
both contentious and difficult, we actually think we would need to not just take the AMA House of Delegates resolution at its face value, but investigate the process that led to that, investigate the underlying publications along the lines of the way the Defense Department recently did in its February.

[00:15:22] Speaker 03:
And that's a major effort.

[00:15:25] Speaker 03:
as a priority matter, we don't think it's the right way to spend our resources.

[00:15:33] Speaker 03:
Can you comment on that?

[00:15:38] Speaker 02:
Sure.

[00:15:38] Speaker 02:
If the agency had made that argument and then made a specific showing that the agency's prioritization of issues required deferring this rulemaking, that may be something that's entitled to some agency deference here.

[00:15:51] Speaker 02:
The case law is clear that this court doesn't simply

[00:15:54] Speaker 02:
blindly defer to the agency's need to re-prioritize certain issues or blindly defer to the agency's... But would you treat that, I mean, just to sort of introduce a sub-question, you could read that in one of two ways.

[00:16:07] Speaker 04:
You could say, well, that's clearly a denial because they've come up and told us in the foreseeable future we don't have the resources.

[00:16:15] Speaker 04:
Would you construe that as a blanket denial that you get them to challenge or is that something that

[00:16:21] Speaker 04:
you view as them just putting a pause on it and not a final decision on whether to proceed?

[00:16:27] Speaker 02:
I understand Judge Toronto's hypothetical to say, we are not doing this because there are other agency priorities that take precedence.

[00:16:36] Speaker 02:
And so I would assume that that communication entailed an actual denial.

[00:16:40] Speaker 02:
We could then challenge it as arbitrary and capricious or otherwise.

[00:16:43] Speaker 02:
But I took your hypothetical to mean that the agency was offering a reasoned explanation for this.

[00:16:47] Speaker 02:
I will adopt that interpretation.

[00:16:50] Speaker 02:
I took your hypothetical to mean that the agency had in fact denied it.

[00:16:53] Speaker 04:
We have to use you as a surrogate to get clarification.

[00:16:57] Speaker 02:
So I think in a circumstance where the agency says to this court and makes a specific reasoned showing that other issues take precedence and that this issue is particularly complicated,

[00:17:09] Speaker 02:
Courts have been forgiving of agencies where they need multiple years to assemble a particular record.

[00:17:13] Speaker 02:
The data is technical.

[00:17:15] Speaker 02:
Things are complicated.

[00:17:16] Speaker 02:
That's not this case.

[00:17:17] Speaker 03:
Can I ask one other thing?

[00:17:18] Speaker 03:
Am I right that one of the other listed exclusions in the regs is for abortion services?

[00:17:23] Speaker 03:
Yes.

[00:17:23] Speaker 03:
And even medically necessary ones?

[00:17:27] Speaker 03:
Yes.

[00:17:27] Speaker 03:
So what's the statutory justification

[00:17:31] Speaker 03:
I realize you don't want to give away other people's challenges.

[00:17:34] Speaker 02:
I would assume it's the Hyde Amendment, which precludes the expenditure of any federal funds.

[00:17:38] Speaker 02:
So there's another statute.

[00:17:39] Speaker 02:
It's a recurring rider to a budget bill.

[00:17:41] Speaker 02:
Some other statutory constraint.

[00:17:44] Speaker 02:
And that is emphatically not an issue here.

[00:17:51] Speaker 01:
But is that an issue for the VA?

[00:17:53] Speaker 01:
Are they worried if they adopt

[00:17:56] Speaker 01:
or they get rid of this exclusion, that Congress is going to come in and legislate a new exclusion mandating them to do this?

[00:18:03] Speaker 02:
I don't know if that's the agency's view.

[00:18:05] Speaker 02:
I think that's always a risk when an agency undertakes regulatory action.

[00:18:09] Speaker 02:
There's always the risk of legislative override, but that's not a reason.

[00:18:14] Speaker 02:
I think our position would be if Congress were to legislate that no federal funds could be spent for sex reassignment surgery, our view would be that's unconstitutional.

[00:18:21] Speaker 01:
That's again not an issue.

[00:18:21] Speaker 01:
Right.

[00:18:22] Speaker 01:
So that's subject to judicial review.

[00:18:23] Speaker 02:
Absolutely.

[00:18:24] Speaker 02:
That's not an issue before this court today.

[00:18:26] Speaker 02:
But the agency, I understand the quibbles some members of the court have with the idea of speaking about the agency.

[00:18:33] Speaker 02:
But the VA acting through its officers has made the determination that sex reassignment surgery is medically necessary in certain cases.

[00:18:41] Speaker 02:
That is consistent with

[00:18:42] Speaker 02:
the only established medical consensus on this issue.

[00:18:46] Speaker 02:
To go back to your point, though, Judge Stroud, though, it may be right in particular cases that the agency needs the time to sift through complicated data to, you know,

[00:18:59] Speaker 02:
The cases talk about delays of four years or six years where the agency is sifting through a really complicated record.

[00:19:05] Speaker 02:
That's not this case.

[00:19:06] Speaker 02:
The agency has done the work and the agency's own words.

[00:19:09] Speaker 02:
It has deliberated upon all the information.

[00:19:11] Speaker 02:
The next step is to institute a rulemaking.

[00:19:14] Speaker 03:
Yeah, but I guess I'm not really sure whether that's right in part because the agency is not the one with congressionally delegated authority.

[00:19:22] Speaker 03:
It's the secretary and the process has not been

[00:19:27] Speaker 02:
I respectfully disagree because I think you're mistaking the secretary's authority to promulgate regulations with the question of final agency action.

[00:19:37] Speaker 02:
There is no requirement that for finality to attach.

[00:19:40] Speaker 03:
Are we talking about the Shulkin letter now or about the spring 2016 draft unsigned notice?

[00:19:47] Speaker 02:
The Shulkin letter is what we rely on as an indication of the agency's determination of finality.

[00:19:53] Speaker 03:
Can I ask a different question?

[00:19:55] Speaker 03:
If there were an individual who sought this surgery and asked the VA and the VA said no,

[00:20:03] Speaker 03:
Could that individual bring a individual as applied challenge, alleging among other things, the kind of statutory or constitutional discrimination grounds?

[00:20:13] Speaker 02:
Yeah.

[00:20:14] Speaker 03:
Are you aware of whether that has happened?

[00:20:17] Speaker 02:
I'm not aware of that having happened.

[00:20:18] Speaker 02:
That obviously would go from the agency itself to the Board of Veterans' Appeals, to the Court of Appeals for Veterans Claims, to this court on that route.

[00:20:26] Speaker 02:
And I think that there may be

[00:20:28] Speaker 02:
jurisdictional questions about which of those courts has the authority to decide a constitutional issue.

[00:20:33] Speaker 02:
But yes, it could be decided in an individual case.

[00:20:36] Speaker 02:
We've elected this vehicle in part to seek relief for the members of TAVA, one of the petitioners, and the hundreds of veterans who are being denied medically necessary care by their sole medical provider.

[00:20:49] Speaker 02:
So I see my time as well.

[00:20:51] Speaker 04:
OK.

[00:20:51] Speaker 04:
We'll re-story about some of that.

[00:20:53] Speaker 04:
Thank you.

[00:21:02] Speaker 00:
Good morning, Your Honors.

[00:21:03] Speaker 00:
May it please the Court?

[00:21:04] Speaker 00:
Catherine Dorsey on behalf of Respondent Appoli, the Secretary of Veterans Affairs.

[00:21:09] Speaker 01:
Petitioners here rely on to... Since the November 2016 letter to Congress, are you aware of any agency action whatsoever on this issue?

[00:21:19] Speaker 00:
I can't point you, Your Honor, to anything specifically that they've done on the petition, but I would

[00:21:26] Speaker 00:
remark that that's not unusual in the case of agency action in responding to a petition for review.

[00:21:34] Speaker 01:
Well, it may not be unusual except when you have a letter to Congress that says we're not going to take any further action on this absent an appropriation from you.

[00:21:44] Speaker 00:
Your Honor, with all due respect, I disagree with that characterization of the letter.

[00:21:49] Speaker 00:
That's not, in fact, what the letter says.

[00:21:50] Speaker 00:
The letter says, and I quote, VA has been and will continue to explore a regular mutory change that would allow VA to perform gender alteration surgery.

[00:22:00] Speaker 00:
And then it also says that VA has begun considering factors impacting this rulemaking process, and then says although

[00:22:07] Speaker 04:
They don't anticipate the rulemaking to become in... But what is it, but the sentence, the first sentence you were referring to concludes with when appropriated funding is available.

[00:22:16] Speaker 00:
Correct, Your Honor.

[00:22:17] Speaker 00:
And we don't, again, the agency of course

[00:22:21] Speaker 00:
The agency's position is that this letter was not intended to be a denial of the rulemaking petition.

[00:22:26] Speaker 00:
And so it contains no reasonable explanation that you would expect in a denial of a petition.

[00:22:30] Speaker 01:
What does that reference to appropriated funding mean?

[00:22:34] Speaker 01:
Does VA get appropriated funding to treat individual conditions or disabilities or diseases?

[00:22:40] Speaker 00:
No, Your Honor.

[00:22:40] Speaker 00:
It's unclear exactly what that means in the letter.

[00:22:43] Speaker 01:
And that is why we have said that... Has VA ever relied on a lack of appropriations to deny medically necessary treatment?

[00:22:50] Speaker 00:
Not that I'm aware of, Your Honor.

[00:22:52] Speaker 00:
Of course, it has appropriated funds, and it has to stay within those to cover the general medical benefits, but not on a particular case.

[00:22:59] Speaker 04:
And do you happen to know what percentage?

[00:23:01] Speaker 04:
I think the calculation in the record may be something like the cost of $17 million when the calculations were done.

[00:23:08] Speaker 04:
Assume the general appropriations.

[00:23:11] Speaker 04:
That must be an absolutely minuscule portion of the entire appropriations.

[00:23:16] Speaker 00:
That is, Your Honor.

[00:23:17] Speaker 00:
And again, this is all, we don't think the letter functions as a denial.

[00:23:20] Speaker 00:
We don't think even if this court construed that letter to be a denial, that it contained the reason decision-making that would be necessary for this court to review a denial of the petition under Section 502.

[00:23:33] Speaker 04:
So if we construe it as a denial, you're asking us to send it back then and allow you the opportunity to give a reasoned basis for it.

[00:23:43] Speaker 01:
That's correct, Your Honor.

[00:23:44] Speaker 04:
What if we were to conclude there was an unreasonable delay?

[00:23:48] Speaker 04:
What would your view be in terms of what our next step would be?

[00:23:52] Speaker 00:
Again, just as a premise, we don't think there is an unreasonable delay.

[00:23:56] Speaker 00:
No, of course.

[00:23:56] Speaker 00:
I'm happy to discuss that later.

[00:23:57] Speaker 00:
But if the court were to find that there was an unreasonable delay, then we think the agency

[00:24:03] Speaker 00:
could direct that the court could direct the agency to respond to the petition for review, either to grant it or deny it.

[00:24:11] Speaker 04:
Presumably within a certain amount of time.

[00:24:14] Speaker 00:
Correct, Your Honor.

[00:24:15] Speaker 00:
Of course, before that, you give the, if you were to do that, to give the agency as much time as it could.

[00:24:20] Speaker 04:
Well, what would you, do you have any, I mean, 30 days?

[00:24:23] Speaker 04:
I mean, do you have any view in terms of what's feasible?

[00:24:25] Speaker 04:
Under the circumstance where the predicate of my hypothetical is we found an unreasonable delay, I think we would assume that we needed to put a time frame on it.

[00:24:33] Speaker 00:
Your Honor, we would, if the court were to go there, we would request at least 120 days, because that seems consistent with other cases where this court has

[00:24:43] Speaker 00:
order the VA to act and given all its other obligations, we think that, and given the fact also that this petition now has just been pending for two years, which goes to our understanding that we don't think there's been any unreasonable delay here.

[00:24:59] Speaker 00:
But we would ask respectfully, if you were to go there, would the agency at least be given reasonable delay?

[00:25:03] Speaker 03:
And if we thought that we don't actually know whether there's unreasonable delay because we don't

[00:25:13] Speaker 03:
We haven't been given any meaningful explanation.

[00:25:16] Speaker 03:
There's really that one, I don't know, tail-swallowing sentence in your brief that says, no unreasonable delay because we've been thinking about it, which doesn't seem to me to actually give any reasons.

[00:25:29] Speaker 03:
So if we thought it was essentially a present unexplained delay, what would we do?

[00:25:36] Speaker 00:
Well, I would think in that case, Your Honor, that there wouldn't be jurisdiction.

[00:25:39] Speaker 00:
Because there only gets to be jurisdiction under 502 and under the track analysis if this court determines that there is an unreasonable delay such that the court has to protect its jurisdiction.

[00:25:53] Speaker 00:
Otherwise, given that there is not a denial here, there's not jurisdiction under 502.

[00:25:59] Speaker 03:
But how do we, I mean, I know it seems to me a little bit odd.

[00:26:02] Speaker 03:
We can't tell if there's an unreasonable delay because you haven't articulated what you've been up to or why you haven't been up to this because of other priorities or what reason there is for the lapse of, I guess, now two years.

[00:26:20] Speaker 00:
But I don't think that's uncommon in the track analysis that this court and the DC Circuit have performed in other cases, because you usually look to what is in the record at the time, and the passage of time here, it's been just under two years.

[00:26:36] Speaker 00:
And as Your Honor pointed out in your earlier question,

[00:26:39] Speaker 00:
There have really been no cases that have found unreasonable delay in under two years.

[00:26:45] Speaker 00:
I think the families for freedom, I think even that case was a two and a half year delay, but most of them have been substantially longer.

[00:26:51] Speaker 04:
In the track case itself, I assume you would call the details.

[00:26:56] Speaker 04:
I think they didn't find any delays to justify mandamus, but they did think there was a basis for retaining jurisdiction.

[00:27:07] Speaker 04:
And so even though the mandate issued in that case, they required FCC to come in every period of time.

[00:27:16] Speaker 04:
And I guess, is it your understanding to tell them what the status is or to explain why there is continuing delay?

[00:27:23] Speaker 00:
I think in that case, it was to explain the status, which rather than the continuing delay, it was my understanding.

[00:27:31] Speaker 04:
But is that typically, I mean, you have more experience maybe than the DC Circuit cases than I. I mean, is that something that courts would typically, when they find no unreasonable delay, is it very uncommon for the court to retain jurisdiction for purposes of monitoring?

[00:27:46] Speaker 00:
I would think it would be, Your Honor, in part because it would be very uncommon.

[00:27:50] Speaker 00:
Because in part, the whole reason of not having

[00:27:54] Speaker 00:
review until after their final agency action is to let the agency complete its process and also so then that this court would have a complete record to review that and determine whether a denial of a petition for rulemaking on the record is arbitrary and capricious or not.

[00:28:12] Speaker 03:
Can I just ask this question?

[00:28:15] Speaker 03:
Why is it taken so long?

[00:28:19] Speaker 00:
We have no explanation in the record

[00:28:23] Speaker 00:
to support a denial.

[00:28:25] Speaker 00:
And we don't even know whether the agency at this point is going to deny the petition or grant it.

[00:28:29] Speaker 00:
It is still pending before the agency.

[00:28:32] Speaker 00:
And there are a number of reasons we could speculate about, Your Honor, about why this could be taking long.

[00:28:37] Speaker 00:
There's a lot of medical uncertainty and disagreement.

[00:28:39] Speaker 03:
How do we find out?

[00:28:42] Speaker 00:
How do we find?

[00:28:43] Speaker 00:
Well, I think what normally happens, Your Honor, is that the rulemaking

[00:28:50] Speaker 00:
the agency completes its review of the petition for rulemaking, issues a denial or a grant, and then this court is reviewed.

[00:28:59] Speaker 03:
That's how we would find out what the agency, the delegated agency, had thought about the petition.

[00:29:07] Speaker 03:
How do we find out whether the delay in

[00:29:11] Speaker 03:
getting to a decision is unreasonable.

[00:29:13] Speaker 00:
No, but Your Honor, that would also illustrate what the agency has been doing over that time.

[00:29:18] Speaker 00:
But the general procedure is that the court reviews it at the end of that process.

[00:29:22] Speaker 00:
It doesn't come in the middle of these things.

[00:29:23] Speaker 01:
But we don't need the unreasonable delay test, though, if we have a final agency decision.

[00:29:27] Speaker 00:
That's correct.

[00:29:28] Speaker 01:
I think what we're concerned about is how do we even know if there's an unreasonable delay here?

[00:29:33] Speaker 01:
Because VA hasn't put anything in the record about what it's been doing since

[00:29:38] Speaker 01:
fall of 2016 when it wrote this letter to Congress.

[00:29:41] Speaker 00:
I don't think that's right, Your Honor.

[00:29:43] Speaker 01:
It's not right that you haven't put anything in the record or it's not right that we can't review it.

[00:29:48] Speaker 00:
It's not right that there's been an unreasonable delay here because they haven't put anything in the record.

[00:29:53] Speaker 00:
There is information in the record.

[00:29:55] Speaker 00:
There's the notice of proposed rulemaking, which indicates that the agency has been considering the issue and deciding what to do.

[00:30:06] Speaker 01:
I know you point to

[00:30:07] Speaker 01:
a lot of cases that say two years isn't enough.

[00:30:10] Speaker 01:
But when it's such a significant and potentially deadly health issue, why isn't two years unreasonable?

[00:30:19] Speaker 00:
Well, Your Honor, again, because it's not two years where it's just been agency recalcitrance.

[00:30:25] Speaker 00:
If that was what we had there, it might be a different situation.

[00:30:28] Speaker 01:
The only thing in the record is activity up to November 2016.

[00:30:35] Speaker 01:
We don't know one way or another whether anything is going on.

[00:30:39] Speaker 01:
You can't represent to us one way or another whether anything specific is going on.

[00:30:44] Speaker 00:
Well, we have the representation in the letter to Congress which says that the VA has begun considering the factors.

[00:30:50] Speaker 00:
It has been and will continue to explore regulatory change.

[00:30:54] Speaker 00:
We have the notice of proposed rulemaking.

[00:30:56] Speaker 01:
When appropriated funding is available.

[00:30:58] Speaker 01:
Again, that is a very weird description for what VA is going to do, but it suggests to me that they have said,

[00:31:04] Speaker 01:
We're not going to look at this anymore until you tell us it's okay.

[00:31:08] Speaker 00:
And again, we are saying that the VA is saying that is not a reason that would support a denial of a rulemaking petition if that's what... Well, sure.

[00:31:18] Speaker 01:
Even if we agree with you that it's not a denial, it does suggest that maybe they're still not doing anything on this until they get appropriate funding.

[00:31:28] Speaker 00:
I don't think that's right, Your Honor.

[00:31:29] Speaker 00:
I think it suggests that they're... What does that sentence mean?

[00:31:31] Speaker 01:
This is all we have.

[00:31:33] Speaker 01:
We have nothing else.

[00:31:34] Speaker 01:
The proposed rulemaking doesn't help you at all because it speaks very strongly for why this exclusion should be gotten rid of.

[00:31:42] Speaker 00:
Well, I would disagree with that, Your Honor, because the notice of proposed rulemaking, as we've been discussing this morning, it wasn't signed by the secretary.

[00:31:50] Speaker 00:
It was withdrawn.

[00:31:52] Speaker 00:
It was never published.

[00:31:54] Speaker 00:
I'd say a good analog case to show why that can't really have any import here is the case cited by petitioners, the public in their opening brief, public citizen be commissioner of FDA.

[00:32:04] Speaker 04:
You're saying it has no import to the question of whether or not there's been a final denial, right?

[00:32:09] Speaker 00:
That's correct.

[00:32:10] Speaker 00:
And they rely on it to show that the agency's position is that gender alteration surgery is medically necessary.

[00:32:19] Speaker 00:
But the secretary has not made that determination.

[00:32:22] Speaker 01:
But then you turn around and rely on it as saying the agency is working towards this and then say, but it's been withdrawn.

[00:32:30] Speaker 01:
I mean, I don't understand how you can rely on it as the agency is making progress on this issue

[00:32:36] Speaker 01:
When in this letter, they say it's been withdrawn, and we're not going to do anything else until you appropriate fundings.

[00:32:42] Speaker 00:
And the public citizen case VFDA is a good explanation why, Your Honor, because the agency can go through a process where it proposes something, it withdraws it as it thinks about the issue more, it does some more thinking, it collects some more evidence, it considers the issue.

[00:32:57] Speaker 01:
And that case indicated that when... Yes, but usually when the agency goes through more thinking,

[00:33:01] Speaker 01:
and collects more evidence, it issues a notice to the public to submit comments or submit evidence, or it does something of the like.

[00:33:09] Speaker 01:
We have no indication that you've done anything since November of 2016.

[00:33:14] Speaker 00:
Your Honor, if it gets to a proposed rulemaking, yes, but if they're reconsidering the notice or the proposed rule they had previously considered and are trying to

[00:33:24] Speaker 00:
reconsider now, there's nothing that would normally come out and be issued to the public or published for notice and comment why they're still considering the issue.

[00:33:33] Speaker 00:
This is a very important health issue.

[00:33:36] Speaker 00:
Nobody disagrees about that.

[00:33:38] Speaker 04:
But isn't that the point of, I mean, as Judge Toronto was talking earlier, I mean, even if there are difficult issues that require further analysis, isn't that part and parcel of sending out the notice and getting comments on those issues?

[00:33:52] Speaker 04:
Or how much do you have to do beforehand, and how much do you do until you just... The notice, you don't have to take a position on the notice, as Judge Toronto pointed out.

[00:34:00] Speaker 03:
Do you agree with that, by the way, that it can be a kind of neutral notice?

[00:34:05] Speaker 00:
I don't think there's anything that would preclude the agency from doing that, Your Honor, although it would be passing strength.

[00:34:11] Speaker 03:
As I read 553A3 specifically says, give notice of a proposed rule or the issues to be discussed.

[00:34:16] Speaker 03:
That suggests...

[00:34:17] Speaker 00:
But normally, I mean in the normal, I don't think there's anything that would preclude it, but normally agencies decide what they want to do and then they issue a proposal.

[00:34:27] Speaker 04:
But that's possibly more frequent when you're talking about operating on a clean slate.

[00:34:32] Speaker 04:
Whereas in this circumstance, we don't have a clean slate.

[00:34:34] Speaker 04:
There's a rule in effect that does one thing and they're thinking about removing it.

[00:34:39] Speaker 04:
So it might make more sense, at least in that context, to not take a position.

[00:34:45] Speaker 04:
Because they've already made it, right?

[00:34:47] Speaker 04:
You understand?

[00:34:47] Speaker 00:
Well, they have the interesting that is their position.

[00:34:49] Speaker 04:
Yeah, and that's a little different than if you're operating under a clean slate, I would think.

[00:34:53] Speaker 00:
Perhaps.

[00:34:54] Speaker 00:
But I think it's here, again, that the secretary is the one with broad discretion, as this court has recognized, to determine what benefits are needed.

[00:35:02] Speaker 00:
And I think the agency, again, can be considering that.

[00:35:06] Speaker 00:
Again, we don't have the agency's reasons behind, which is why we think if this court thinks there's a denial of remand would be appropriate.

[00:35:14] Speaker 03:
But can I ask, I mean, you actually have a client here, right?

[00:35:18] Speaker 03:
In some sense or other, the secretary is your client.

[00:35:22] Speaker 03:
Any enlightenment about A, is the secretary and the sec, I guess there's an acting secretary now.

[00:35:30] Speaker 03:
Is the acting secretary and the people who work for the acting secretary, are they engaged in anything that might, two things, might be considered active consideration of this?

[00:35:41] Speaker 03:
And second, any enlightenment about what I guess then secretary and undersecretary Shulkin meant by this when appropriated funding is available?

[00:35:52] Speaker 03:
I mean, I suppose one might read it to mean

[00:35:54] Speaker 03:
that change is not going to be made until appropriated funding is available.

[00:36:00] Speaker 03:
But it might also be read to mean we're not even going to explore the issue until appropriated funding.

[00:36:07] Speaker 03:
And I'm not quite sure how to read that.

[00:36:09] Speaker 03:
So that's a two-part question.

[00:36:11] Speaker 03:
What do you know from your client?

[00:36:14] Speaker 00:
I don't have any information as to, again, I can't point this court to specific things that the agency is undertaking now on this rulemaking.

[00:36:24] Speaker 00:
But I can say that the petition for rulemaking has not been denied.

[00:36:28] Speaker 00:
It is pending before the agency.

[00:36:30] Speaker 01:
But pending in actively considering it or locked away in a Manila folder in somebody's cabinet because they're not doing anything on it?

[00:36:40] Speaker 00:
Your Honor, there's a presumption of regularity in agency action that they are not just putting it aside.

[00:36:46] Speaker 01:
Yes, but we don't have a blank slate here.

[00:36:48] Speaker 01:
We have a letter from the secretary that can be read as suggesting they're not going to do anything on this.

[00:36:53] Speaker 00:
Your Honor, I just don't think that's, with all due respect, I don't think that's a fair agreement of the letter when it says we have been, has been, and will continue to explore regular change.

[00:37:02] Speaker 01:
Can I ask you another question?

[00:37:03] Speaker 01:
You referred a little earlier to medical disagreement.

[00:37:08] Speaker 01:
Are you aware of any significant disagreement by mainstream established medical organizations that deny that these kind of procedures are necessary for gender dysphoria?

[00:37:22] Speaker 00:
I'm not sure exactly what your definition of what qualifies as mainstream, Your Honor, but there are other studies that have been done that question whether gender transition surgery or even some of the hormonal treatment, how much that remedies the underlying effects of the medical condition of medical gender dysphoria.

[00:37:46] Speaker 00:
For instance, there's a DOD report that discusses this and says that it's not clear which relates to the military's policy.

[00:37:55] Speaker 01:
I mean, the military policy is a completely different question, though.

[00:37:59] Speaker 01:
That's about ability to serve and the like.

[00:38:02] Speaker 01:
And you can be perfectly emotional.

[00:38:05] Speaker 01:
This is whether it's medically necessary.

[00:38:08] Speaker 00:
Yes.

[00:38:09] Speaker 00:
I agree that the issues are different, but in that report, the DOD report, it cites to some medical studies which they say create uncertainty about the effectiveness of surgery as a treatment for the underlying condition of genderless men.

[00:38:26] Speaker 01:
Which report is that?

[00:38:26] Speaker 01:
Is that the latest one that's attempting to justify the exclusion?

[00:38:30] Speaker 00:
Yes, Your Honor, that is.

[00:38:32] Speaker 01:
And there are a lot of

[00:38:34] Speaker 01:
reports previously from past DOD reports that go the other way.

[00:38:39] Speaker 00:
Yes, and that report discusses those reports also.

[00:38:41] Speaker 00:
But there is evidence in the community that there is disagreement and medical uncertainty on that point.

[00:38:49] Speaker 00:
And the VA, again, we're in the world of the hypothetical here, but the VA could reasonably decide to be looking at all that research that's going on by DOD, by other doctors, by other organizations,

[00:39:03] Speaker 00:
and decide to take this on to consider.

[00:39:04] Speaker 00:
The VA has a very unique population that it takes care of, and there are certain risks there.

[00:39:11] Speaker 00:
They have a high incidence of suicide in their population and other medical risks, which warns them to speak caution.

[00:39:17] Speaker 01:
Doesn't that underscore why you need to make a decision on this now?

[00:39:23] Speaker 00:
Again, they want to be cautious because deciding one way or the other is going to have an effect on this population.

[00:39:28] Speaker 00:
And I think the VA is allowed and permitted in their discretion.

[00:39:32] Speaker 01:
Well, if you lift the exclusion, how is it going to have a detrimental impact on this population?

[00:39:38] Speaker 00:
Well, if, for instance, the surgery is not effective on the underlying condition of gender dysphoria but could make things worse, allowing that

[00:39:47] Speaker 00:
that surgery could possibly have a detrimental effect.

[00:39:50] Speaker 01:
Are you aware of studies that say it makes it worse?

[00:39:53] Speaker 01:
I thought you were just talking about studies that says it's not effective in completely treating gender dysphoria.

[00:39:58] Speaker 00:
That's fair, I think, Your Honor, in which case the Secretary also can take in cost into account to not provide a procedure that is that the effectiveness, there's a cost benefit,

[00:40:10] Speaker 01:
Are you aware of any, I think I already asked you this, you're not aware of any situation where the VA has denied medically necessary treatment because of cost?

[00:40:23] Speaker 00:
I don't think I can phrase it quite that way, Your Honor, because I can't agree with that characterization, because cost is very much a part, and Congress has instructed- But ruled out entire classes of treatment that's generally deemed medically necessary.

[00:40:38] Speaker 01:
I'm not talking about an individual case.

[00:40:40] Speaker 00:
Well, there are other exclusions in, for instance,

[00:40:45] Speaker 00:
The exclusions list IVF treatment was not covered.

[00:40:49] Speaker 00:
Now, Congress did provide separate appropriation for that, but that's in the exclusions.

[00:40:53] Speaker 00:
So there are a few others.

[00:40:54] Speaker 04:
But the costs involve just the procedure, because it's my understanding that the VA does cover costs associated pre and post surgery.

[00:41:04] Speaker 04:
So to the extent surgery causes, arguably, I think you were saying might cause some other things to happen.

[00:41:12] Speaker 04:
I mean, that's already covered by the VA.

[00:41:15] Speaker 04:
That's not an additional cost posed by the surgery because people are free to go out and have their

[00:41:19] Speaker 04:
outside the surgery and the Veterans Administration is already committed to covering the costs of post and pre, right?

[00:41:25] Speaker 00:
That's correct, Your Honor.

[00:41:27] Speaker 00:
It's just the cost of actually providing the surgery, which given all the costs on the VA and what they want to cover and all the benefits, the secretary, I mean, Congress has instructed the VA to consider costs.

[00:41:40] Speaker 00:
There are several provisions in the statutory.

[00:41:43] Speaker 04:
And the report on costs, the cost estimate was 17 million, correct?

[00:41:48] Speaker 00:
Correct, but that's still 17 million that could potentially not be spent on something else.

[00:41:52] Speaker 00:
And again, it's all in the realm of hypothetical.

[00:41:54] Speaker 04:
No, I understand.

[00:41:55] Speaker 04:
Well, let me ask you another hypothetical.

[00:41:57] Speaker 04:
And I appreciate that you were resisting Judge Toronto's invitation to suggest what the reasons are for the delay.

[00:42:06] Speaker 04:
Hypothetically, if the real reason were that we've had a change of administrations and we had to fill 16

[00:42:16] Speaker 04:
assistant secretary slots, many of whom are involved in this, and we haven't gotten one confirmation through the Senate.

[00:42:23] Speaker 04:
And now we have a transition with respect to the secretary.

[00:42:25] Speaker 04:
It's just a matter of manpower in the transition.

[00:42:28] Speaker 04:
Do you consider that a legitimate basis to excuse unreasonable delay or not at all because you just can't go there?

[00:42:38] Speaker 00:
I mean, perhaps the court could consider that in the unreasonable delay analysis if that was

[00:42:45] Speaker 00:
if it was a factor on the passage of time.

[00:42:49] Speaker 00:
But again, here there's no congressional timetable that's been set on when the VA needs to decide a petition for you.

[00:42:58] Speaker 00:
And frankly, it's not in anybody's interest to hurry the VA up past beyond if it wants to give something considered judgment.

[00:43:08] Speaker 04:
I know every case is very different, but do you have a statistical historical analysis of

[00:43:14] Speaker 04:
the petitions for review, how long the VA is taken historically?

[00:43:19] Speaker 00:
I do not, Your Honor.

[00:43:20] Speaker 00:
I would imagine it would vary greatly depending on the petition and the complexity of it.

[00:43:24] Speaker 00:
And so I don't have that number for Your Honor.

[00:43:27] Speaker 01:
So in your view, if we want an explanation for the unreasonable delay, the only way we can do it is actually go through the track factors, find unreasonable delay, and remand it back to the agency.

[00:43:41] Speaker 01:
You don't think we can issue an order saying in 90 days you have to respond to why the petition for rulemaking hasn't been ruled upon.

[00:43:50] Speaker 00:
I think it would certainly be a difficult jurisdictional question, Your Honor, and I'm not sure this court would have jurisdiction to do it.

[00:43:59] Speaker 03:
Again, because I think if there's- Why is that a difficult jurisdictional question?

[00:44:04] Speaker 03:
My understanding, correct me if I'm wrong, is that the unreasonable delay

[00:44:08] Speaker 03:
Prong of the analysis typically takes place under 28 USC 1653, not under 502 and under the theory that it's in aid of the jurisdiction to ultimately do the review once the thing is decided.

[00:44:23] Speaker 03:
So why isn't it in aid of the 502 jurisdiction to issue an order under 1653 saying, tell us why, what's going on?

[00:44:33] Speaker 00:
I agree in part, Your Honor, that it is in aid of the 502 jurisdiction.

[00:44:38] Speaker 00:
But the 502 jurisdiction doesn't kick in unless there has been a denial.

[00:44:44] Speaker 00:
So whether there's unreasonable delay so that the agency has effectively denied the petition.

[00:44:54] Speaker 03:
But 1653 is always in aid of some other jurisdiction.

[00:44:57] Speaker 00:
Correct.

[00:44:58] Speaker 00:
But I think since you'd have to find that there

[00:45:01] Speaker 00:
is unreasonable delay in order to find that it needs to be in aid of jurisdiction here.

[00:45:09] Speaker 04:
Well, but if we apply the track factors, don't we, couldn't that be a reason that we need some more information?

[00:45:15] Speaker 04:
I mean, it says one of the last factors, the court did not find any impropriety lurking behind the agency lastitude in order to hold that agency action as unreasonable delay.

[00:45:25] Speaker 04:
Isn't it difficult to evaluate that with no rationale coming in from the agency side?

[00:45:30] Speaker 00:
I don't think so your honor because that's generally been sort of concerned allegations of bad faith and here there's certainly no allegation of bad faith and again it's not an instance of agency recalcitrance we've seen that the agency has been doing something granted there's been

[00:45:46] Speaker 00:
a bit of time where there's nothing on the public record, but there is the notice of proposed rulemaking.

[00:45:52] Speaker 00:
And there's no congressional timetable of when the VA needs to respond for a petition for review.

[00:45:58] Speaker 00:
And we all know the VA has a lot of competing priorities and issues to deal with.

[00:46:03] Speaker 00:
So given all that, I think this court would be hard pressed to find that less than two years now is unreasonable delay of the type this court and the DC Circuit have found in other cases.

[00:46:17] Speaker 04:
Thank you.

[00:46:26] Speaker 02:
Thank you.

[00:46:27] Speaker 02:
If I may, Your Honor, I want to correct one misstatement I made.

[00:46:30] Speaker 02:
Medicare has the national coverage determination, which provides for sex reassignment surgery in medically necessary cases.

[00:46:36] Speaker 02:
Medicaid is left up to the states, and an increasing number of states cover sex reassignment surgery.

[00:46:42] Speaker 02:
First about the track review.

[00:46:44] Speaker 02:
First off, Section 706 specifies that the court should set aside agency action unreasonably delayed.

[00:46:49] Speaker 02:
So I don't think it's purely a question of mandamus or all-rich jurisdiction.

[00:46:53] Speaker 02:
There's statutory jurisdiction under 706 to set aside that action.

[00:46:57] Speaker 02:
And under 502, you have jurisdiction to implement 706 by setting aside action.

[00:47:03] Speaker 03:
I thought 502 is the only jurisdictional provision.

[00:47:05] Speaker 03:
And the APA is, in fact, not jurisdictional.

[00:47:08] Speaker 03:
It just sets out standards of review.

[00:47:10] Speaker 03:
for the exercise of jurisdiction otherwise given.

[00:47:12] Speaker 03:
Didn't Califano against Sanders say that?

[00:47:16] Speaker 02:
So it's either WWHT or TRAC itself that recognizes that 706 supports the exercise of jurisdiction under the APA to set aside agency action that's been unreasonably withheld.

[00:47:28] Speaker 02:
I mean, this court's ability to set aside agency action that's been unreasonably withheld, I don't think is in question.

[00:47:34] Speaker 02:
But the APA does specify that the agency cannot unreasonably withhold

[00:47:39] Speaker 02:
withhold its decision.

[00:47:42] Speaker 02:
The petitioners have a right to petition the agency, they have a right to a response from the agency, and they have a right to seek court review.

[00:47:48] Speaker 02:
And in this case, the agency is not representing anything specific to this court that it's done in the last 18 months to advance the cause here.

[00:47:56] Speaker 03:
Does 555b or c or something play a role here?

[00:47:59] Speaker 03:
Isn't that also a

[00:48:02] Speaker 03:
Agencies have to respond to petitioners.

[00:48:04] Speaker 03:
I think that's 555E.

[00:48:05] Speaker 03:
E is one of the five.

[00:48:07] Speaker 03:
I mean, I never read 555 before at this course.

[00:48:10] Speaker 02:
So it says that the agency has to respond.

[00:48:12] Speaker 02:
I think there may be some adverb in there about promptly or reasonably or something like that.

[00:48:17] Speaker 02:
But it's all subsumed in the track analysis.

[00:48:19] Speaker 02:
But with respect to the track analysis, first off, I concede that the mind run of track cases finds unreasonable delay only after four or six or more years.

[00:48:29] Speaker 02:
But the DC circuit has been insistent

[00:48:31] Speaker 02:
that delay under track is measured in terms of weeks or months and not years.

[00:48:36] Speaker 02:
And the other five factors go to tease out when the delay is unreasonable.

[00:48:40] Speaker 02:
And here, the most important thing is this is not a case about economic regulation.

[00:48:44] Speaker 02:
This is not a case about rate returns under the California power scheme.

[00:48:49] Speaker 02:
This is about veterans whom this court owes a special solicitude towards dying because they are being deprived

[00:48:57] Speaker 02:
of sex reassignment surgery, medically necessary sex reassignment surgery, no other remedy has been, in their particular case, has allayed their symptoms of gender dysphoria.

[00:49:07] Speaker 02:
The suicide rate is high and sex reassignment surgery has been demonstrated in particular cases to allay the symptoms of gender dysphoria.

[00:49:15] Speaker 03:
Do you think that that portion of the February 2018 DOD report around pages 23 to 27 or something that discuss

[00:49:27] Speaker 03:
discusses the RAND study and the Swedish study.

[00:49:31] Speaker 03:
And I forget what all they are.

[00:49:33] Speaker 03:
It's not specifically about ability to serve well in military service, but simply about what's called the medical studies about actually a range of the gender dysphoria treatments, but including the surgical part.

[00:49:56] Speaker 03:
are relevant, that that's relevant to this question?

[00:49:59] Speaker 02:
No, Your Honor.

[00:50:00] Speaker 02:
Let me be entirely clear about it.

[00:50:02] Speaker 02:
There is no disagreement among responsible parties about the medical necessity of sex reassignment surgery in particular cases.

[00:50:10] Speaker 03:
As I'm sure you're all aware, those- But it sort of depends what you mean by responsible parties, right?

[00:50:14] Speaker 03:
There are organizations that have votes in houses of delegates.

[00:50:19] Speaker 03:
That's not usually the way we do science, right?

[00:50:23] Speaker 03:
The question is, what do the specific studies say and what conclusions do you draw from them?

[00:50:30] Speaker 03:
That's what I think those pages of the DOD report were about.

[00:50:34] Speaker 02:
I think the DOD report first off needs to be read in the context of the question that was put in front of the panel of experts by Secretary Mattis.

[00:50:40] Speaker 02:
The question there is, do transgender service members, active duty service members, pose a risk to lethality, readiness, and unit cohesion?

[00:50:48] Speaker 02:
That is not the question before this court.

[00:50:49] Speaker 02:
So the question of the medical necessity- That's why I was just focusing on those- I understand, but I do think the context there is important.

[00:50:55] Speaker 02:
The question of medical necessity and to what extent medically necessary sex reassignment surgery allays the concerns.

[00:51:02] Speaker 02:
The question there was, to what extent does it relay the symptoms in order to ready someone for battle?

[00:51:07] Speaker 02:
And does it detract from the ability of a unit to cohere on the battlefield?

[00:51:11] Speaker 02:
So I don't think that the analysis that was performed there is at all relevant to this question.

[00:51:16] Speaker 03:
Can I ask you the same question I think the chief asked Ms.

[00:51:20] Speaker 03:
Dorsey?

[00:51:20] Speaker 03:
Is it a legitimate consideration as to the timing of response that the senior positions at the VA have not been filled?

[00:51:36] Speaker 02:
If that were the agency's position.

[00:51:38] Speaker 02:
We don't know.

[00:51:39] Speaker 03:
We haven't been given any explanation.

[00:51:41] Speaker 02:
I understand that.

[00:51:42] Speaker 02:
But if the agency were telling you that there are delays because there are senior personnel responsible for decision making who are not confirmed by the Senate, that may be something you would want to consider.

[00:51:53] Speaker 02:
I would still take the view that those concerns are outweighed by the profound medical need confronting the nation's veterans.

[00:52:00] Speaker 02:
But that's certainly a factor this court could consider.

[00:52:02] Speaker 01:
But those concerns might be at least a little bit more legitimate if we knew the underlying personnel were actually moving forward on the rulemaking.

[00:52:11] Speaker 01:
We were just waiting confirmation from somebody that can actually sign off on it.

[00:52:16] Speaker 02:
Absolutely.

[00:52:16] Speaker 02:
And I think the agency's inability to represent that there is anything going on

[00:52:21] Speaker 02:
is inexcusable under track or even under the finality analysis.

[00:52:25] Speaker 02:
The point of the finality analysis is to look for indicia of whether the agency is at rest on a particular issue.

[00:52:31] Speaker 02:
That letter from November 10, 2016 coupled with the agency's representations before this court should indicate sufficiently to the court that that was a final determination.

[00:52:41] Speaker 02:
Their decision making process for all intents and purposes is consummated.

[00:52:45] Speaker 02:
We have been denied relief as a result of the decision reflected in that letter.

[00:52:51] Speaker 02:
The intervening time period and counsel's concession before this court suffice to corroborate the indicia finality present in that letter.

[00:53:01] Speaker 01:
I want to, if I might just- Can I just ask you one more question?

[00:53:04] Speaker 01:
Sure.

[00:53:04] Speaker 01:
I know you want us to order a rulemaking, but if we're not willing to go that far and we just want the VA to respond about what it's doing and what its decision is,

[00:53:15] Speaker 01:
They suggested 120 days, and I think in your reply brief you suggested 90.

[00:53:19] Speaker 01:
Do you have any real objection to giving them 120 days?

[00:53:24] Speaker 02:
I do, but I don't think that I could justify the difference in 30 days.

[00:53:28] Speaker 02:
But to be clear, Your Honor, I do think one distinction is important.

[00:53:31] Speaker 02:
I don't think it is reasonable to remand to the agency to explain its delay.

[00:53:37] Speaker 02:
That means that we would have an explanation of the delay rather than the substantive disposition of the petition.

[00:53:43] Speaker 01:
So you agree with your friend that we should just, if we go that way, we have to apply track and find unreasonable delay?

[00:53:51] Speaker 02:
No, I think that you can find that the November 2016 letter is a denial or reflects a denial.

[00:53:56] Speaker 01:
Right, right.

[00:53:56] Speaker 01:
Assuming we don't agree with that.

[00:53:58] Speaker 02:
Assuming you don't agree with that, assuming you find that the agency decision has been unreasonably withheld, I think

[00:54:04] Speaker 02:
In our view, rulemaking is the right remedy, but following your logic, I think a remand is necessary for the agency to give a decision.

[00:54:12] Speaker 02:
We are entitled to a decision on the petition.

[00:54:15] Speaker 02:
We are not entitled to an explanation of why it's taking so long.

[00:54:18] Speaker 02:
We are entitled to judicial review of action that has been unreasonably withheld or a denial or

[00:54:23] Speaker 02:
We obviously wouldn't appeal a grant.

[00:54:25] Speaker 04:
Well, wait, what do you say?

[00:54:26] Speaker 04:
I mean, you're entitled to either have them do it or based on a conclusion, and that's based on a conclusion that the delay has been unreasonable.

[00:54:34] Speaker 04:
If we were unable to conclude on this record that there's been an unreasonable delay, then what's the problem before that a predicate to ordering them to do it or to do something or to issue an order?

[00:54:44] Speaker 02:
That's fine.

[00:54:44] Speaker 02:
Should be.

[00:54:45] Speaker 02:
That's certainly fine.

[00:54:46] Speaker 02:
I think my only concern is I wouldn't want a remand for the agency to explain its delay.

[00:54:54] Speaker 02:
Does that make sense?

[00:54:55] Speaker 04:
No, because that's my point.

[00:54:57] Speaker 04:
If we don't have a basis to conclude whether or not it's reasonable or not based on this record, why would we not want to remand to give the agency an opportunity?

[00:55:10] Speaker 04:
Obviously, if they come up short, then the next step would be

[00:55:14] Speaker 04:
They haven't persuaded us is a reasonable delay.

[00:55:16] Speaker 02:
To be frank, Your Honor, I don't think that remedy is appropriate in this case.

[00:55:20] Speaker 02:
We've been waiting two years for an answer on our petition, a conclusion by this court that the agency has unreasonably withheld an answer for the agency to then get 120 days to explain why it's being delayed for us to then come back to this court.

[00:55:32] Speaker 02:
to appeal the decision that it's been unreasonably delayed because their explanation doesn't suffice.

[00:55:37] Speaker 02:
Two years from now, I'm going to be standing in the same position, arguing that there should be a remand for them to now give a reasoned explanation of why they denied our petition on the merits.

[00:55:45] Speaker 02:
And quite honestly, veterans are entitled to better.

[00:55:48] Speaker 02:
We're not entitled to not me, my clients are not entitled to a remand from this court for the agency to finally getting around to justify its two-year delay to the people of the United States.

[00:56:04] Speaker 04:
We thank both sides the case is submitted.

[00:56:07] Speaker 04:
That concludes our proceedings for this morning.