Court Issues Order: Maui Hospital Negotiations Continue

Maui Memorial Medical Center courtesy file image. Maui Now grapic.

Today the US Court of Appeals for the 9th Circuit issued an order allowing transition activities between the State and Kaiser to resume at Maui Memorial Medical Center, Kula Hospital, and the Lānaʻi Community Hospital, according to the state Attorney General.

Despite the developments announced by the Attorney General’s office, those close to the situation say negotiations continue and the order still prevents the parties from actually closing the transaction.  While the initial injunction was dissolved, it was replaced by a “narrow injunction.”

Two days ago, Governor David Ige and the United Public Workers union filed a status report with the Court saying the parties are in the midst of productive conversations regarding a possible resolution of a lawsuit brought by the union in United Public Workers v. Ige.

Governor Ige also asked the Court to let transition activities resume, and UPW did not oppose the Governor’s request, according to the AG.

Attorney General Doug Chin explained, “Allowing transition activities to resume is the best way to give everyone involved adequate time to prepare and minimize disruption in services. Governor Ige’s top priority is to protect patient care at the Maui region hospitals.”

In 2015, the state legislature passed a law ending the Hawaiʻi Health Systems Corporation’s delivery of health care services at the three Maui facilities and transferring service delivery to a private operator.

Earlier this year, the Hawaiʻi Health Systems Corporation board and its regional board signed an agreement to transition the Maui hospitals to a new Kaiser entity, Maui Health Systems. UPW sued to stop the transition from taking place.

On February 19, 2016, United States District Court Judge Helen Gillmor ruled in favor of the State, and UPW appealed to the 9th Circuit Court.

On May 17, 2016, the 9th Circuit Court ordered the State to temporarily stop all activities related to the transition until September 30, 2016, unless sooner terminated by the Court.

“Today’s order documents the parties’ agreement that while negotiations continue, the State will not unilaterally change the status of UPW’s members affected by this transition, or close the transaction,” Chin said. “Other transition activities, however, may resume. Ultimately, we all just want an orderly and safe transition to Kaiser’s operation of the Maui region hospitals.”

The Court ordered another joint status report on June 30, 2016.

The injunction reads as follows:

Pursuant to the Parties’Joint Status Report, and Governor Ige’s Unopposed Motion to Narrow the Injunction premised on the Parties’ Joint Status Report, and good cause appearing,

IT IS ORDERED:

1. The injunction pending appeal, issued May 17, 2016, as modified by the order issued June 2, 2016, is hereby dissolved and replaced by the narrowed injunction pending appeal set forth in Paragraph 2, immediately below.

2. Defendant-Appellee David Y. Ige (“Governor”) and all persons acting in concert with the Governor are enjoined from unilaterally changing the public employment status, or the rights and benefits of UPW’s bargaining unit members affected by 2015 Hawaii Session Law Act 103, or from closing the transaction authorized by 2015 Hawaii Session Law Act 103. This injunction pending appeal is issued pursuant to Fed. R. App. P. 8 and Fed. R. Civ. P. 62(g), and shall remain in effect only until September 30, 2016, unless sooner terminated by the court.

3. On or before June 30, 2016, the parties shall file their Second Joint Status Report setting forth any change in and the current status of the case. Further review and consideration of the Governor’s emergency motion are deferred pending the filing of the parties’ Second Joint Status Report.

PARTIES’ JOINT STATUS REPORT

As ordered by this Court on June 2, 2016, United Public Workers, Plaintiff-Appellant (Union) and Governor David Y. Ige, Defendant-Appellee, jointly submit this status report.

The parties report that they are presently engaged in productive discussions regarding a possible settlement of this case. To facilitate this process, Governor Ige agrees that he will request that this Court narrow the injunction pending appeal, as described below, and the Union agrees that it will not oppose this request during the time period of these discussions regarding a possible settlement. The parties also jointly request that the Court order the parties to file another joint status report with the Court no later than June 30, 2016.

As to the first part of this request, Governor Ige requests (and the Union does not oppose pending these discussions regarding a possible settlement) that this Court narrow the injunction pending appeal issued on May 17, 2016, as modified by the order of June 2, 2016 (Injunction), so that Governor Ige, and those acting in concert with him, are enjoined only from “unilaterally changing the public employment status, or the rights and benefits of UPW’s bargaining unit members affected by 2015 Haw. Sess. L. Act 103, or from closing the transaction authorized by 2015 Haw. Sess. L. Act 103.” In making this request, Governor Ige does not concede any of his arguments relevant to the merits of this appeal. As narrowed in this fashion, other activities contemplated in preparation for the implementation of Act 103 would not be enjoined. This will facilitate the parties’ efforts to settle this matter. The parties request that the current expiration date for the Injunction (Sept. 30, 2016, unless sooner lifted by the Court) remain unchanged for now, and that the Court continue to defer further review and consideration of the Governor’s emergency motion filed on May 20, 2016, pending the filing of the parties’ next Joint Status Report.

DATED: Honolulu, Hawaiʻi; and San Francisco, California, June 15, 2016.

Respectfully submitted,

/s/ Douglas S. Chin
DOUGLAS S. CHIN 6465
Attorney General of Hawaiʻi
DEIRDRE MARIE-IHA 7923
RICHARD H. THOMASON 5140
Deputy Attorneys General
Attorneys for Defendant-Appellee

/s/ Scott Kronland
SCOTT KRONLAND
STACEY M. LEYTON
CONNIE K. CHAN
ALTSHULER BERZON LLP
177 Post St., Suite 300
San Francisco, California, 94108

HERBERT TAKAHASHI
REBECCA L. COVERT
TAKAHASHI & COVERT
345 Queen St., Rm. 506
Honolulu, Hawaii, 96813

Attorneys for Plaintiff-Appellant