Genesis Healthcare, Inc. v. Xavier Becerra, as Secretary of the United States Department of Health

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 20-1701
GENESIS HEALTHCARE, INC.,
Plaintiff - Appellant,
v.
XAVIER BECERRA, as Secretary of the United States Department of Health and
Human Services; GEORGE SIGOUNAS, as Administrator of the Health Resources
and Services Administration; KRISTA PEDLEY, as Captain in the United States
Public Health Service and Director of the Office of Pharmacy Affairs in the Health
Resources and Services Administration,
Defendants - Appellees.
Appeal from the United States District Court for the District of South Carolina, at Florence.
R. Bryan Harwell, Chief District Judge. (4:19-cv-01531-RBH)
Argued: March 9, 2022 Decided: July 1, 2022
Before GREGORY, Chief Judge, and NIEMEYER and AGEE, Circuit Judges.
Reversed and remanded by published opinion. Judge Niemeyer wrote the opinion, in
which Chief Judge Gregory and Judge Agee joined.
ARGUED: James Mixon Griffin, GRIFFIN DAVIS LLC, Columbia, South Carolina, for
Appellant. Brian James Springer, UNITED STATES DEPARTMENT OF JUSTICE,
Washington, D.C., for Appellees. ON BRIEF: Margaret N. Fox, GRIFFIN DAVIS LLC,
Columbia, South Carolina; Daniel J. Westbrook, NELSON MULLINS RILEY &
SCARBOROUGH LLP, Columbia, South Carolina, for Appellant. Jeffrey Bossert Clark,

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Acting Assistant Attorney General, Abby C. Wright, Thais-Lyn Trayer, Civil Division,
UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C.; Peter M. McCoy,
United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Columbia,
South Carolina, for Appellees.

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NIEMEYER, Circuit Judge:
This appeal by Genesis Healthcare, Inc. challenges the district court’s order
dismissing its action against the government as moot.
Genesis Healthcare is a healthcare provider participating in the federal “340B
Program,” which is designed to provide drugs to qualified persons at discounted prices.
Under the Program, the Secretary of the Department of Health and Human Services
(“HHS”) enters into agreements with drug manufacturers to sell drugs at discounted prices
to entities such as Genesis Healthcare, which can, in turn, sell the drugs to their patients at
discounted prices. After Genesis Healthcare purchases the covered drugs from the
manufacturers, it dispenses them to patients through its wholly owned pharmacies or
contract pharmacies.
After the Health Resources and Services Administration (“HRSA”), an agency
within HHS, conducted an audit of Genesis Healthcare in June 2017 for Program
compliance, HRSA removed Genesis Healthcare from the 340B Program. The audit report
found, among other things, that Genesis Healthcare dispensed 340B drugs to individuals
who were ineligible because they were not “patients” of Genesis Healthcare. Genesis
Healthcare protested HRSA’s findings, objecting to its definition of “patient” as too narrow
and not in conformance with the term in the governing statute. After HRSA rejected
Genesis Healthcare’s challenges, Genesis Healthcare commenced this action, seeking a
declaratory judgment that it did not violate the requirements of the Program and injunctive
relief requiring HRSA to reinstate it into the Program and to retract any notifications that

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HRSA had provided to manufacturers stating that Genesis Healthcare was ineligible under
the Program.
In response to the lawsuit, HRSA vacated its order removing Genesis Healthcare
from the 340B Program, but it continued to insist that Genesis Healthcare comply with its
requirement of serving only eligible “patients,” as it had defined that term. Genesis
Healthcare then filed an amended complaint to take into account HRSA’s action. It alleged
that even though it was returned to the 340B Program, HRSA continued to seek to enforce
a definition of “patient” that Genesis Healthcare alleged contradicted “the plain language
of the statute,” to its detriment. For relief, Genesis Healthcare sought a declaratory
judgment that “the only statutory requirement for 340B eligibility of a person is that the
person be a patient of a covered entity, as clearly stated in 42 U.S.C. § 256b(a)(5)(B).” It
also sought injunctive relief requiring HRSA “to retract any notification it may have
provided to manufacturers that Genesis is ineligible under the 340B program” and to “set
aside HRSA’s determinations.”
In response to the amended complaint, HRSA (1) notified Genesis Healthcare by
letter that it “ha[d] voided” all audit findings and that Genesis Healthcare “ha[d] no further
obligations or responsibilities in regard to the audit” and (2) filed a motion to dismiss
Genesis Healthcare’s action as moot based on the letter.
The district court granted HRSA’s motion, finding that the action was moot. The
court concluded that while Genesis Healthcare may be challenging the “audit process,” it
was “not challenging the final result of the agency’s process — the decision to void the
audit and restore Plaintiff’s eligibility to participate in the 340B Program.” As a

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consequence, it held that there was no final agency action for review under the
Administrative Procedure Act (“APA”), 5 U.S.C. § 704. It also held that as to Genesis
Healthcare’s request for declaratory relief, there was “no case or controversy as required
by Article III” because “the parties ceased to have a ‘definite and concrete’ controversy
when the agency decided to void its audit findings.”
Yet, while Genesis Healthcare’s initial request for reinstatement was satisfied by
HRSA’s subsequent action voiding its audit findings, HRSA continues to have the ongoing
duty to audit Genesis Healthcare, and the company continues to be obligated to comply
with the 340B Program’s requirements and is susceptible to removal from the Program if
it rejects HRSA’s continuing use of the definition of “patient.” Thus, because Genesis
Healthcare continues to be governed by a definition of “patient” that, it maintains, is illegal
and harmful to it, we conclude that there remains a live controversy between the parties.
Accordingly, we reverse the district court’s judgment and remand for further proceedings.
I
Genesis Healthcare participates in the 340B Program from various locations in
South Carolina, selling to patients discounted drugs that it purchases from manufacturers
participating in the Program. Participating entities, such as Genesis Healthcare, must,
among other things, maintain auditable records and, with those records, be able to
demonstrate that they only sell or otherwise transfer the discounted drugs to persons who
qualify as “patients.” And HRSA conducts audits from time to time, as authorized by the
governing statute, to ensure compliance with the Program’s requirements.

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In June 2017, HRSA conducted an audit of Genesis Healthcare over a two-day
period. In its audit report and accompanying cover letter, dated February 14, 2018, it made
a preliminary determination that Genesis Healthcare was no longer eligible to participate
in the 340B Program and that it was liable to drug manufacturers for the drug discounts
that it had received. The report found that Genesis Healthcare “failed to maintain auditable
records” and that it “dispensed 340B drugs to ineligible individuals,” i.e., any “person who
is not a patient of the entity.” In reaching that conclusion, the report stated that HRSA was
enforcing “[p]atient eligibility requirements . . . defined in guidelines (61 Fed. Reg. 55156
(Oct. 24, 1996)).” Genesis Healthcare objected to the report, but HRSA, after assessing
Genesis Healthcare’s objections, adhered to its findings and issued a final audit report and
cover letter dated June 26, 2018. The June 26 letter stated, “The documentation GHI
[Genesis Healthcare] provided is insufficient to show that all patient definition criteria
were met (61 Fed. Reg. 55156 (Oct. 24, 1996)). GHI has not shown that it met the
applicable elements of the current HRSA patient definition.” (Emphasis added). The
attached report stated further that “[c]overed entities are prohibited . . . from reselling or
otherwise transferring 340B drugs to a person who is not a patient of the entity. Patient
eligibility requirements are defined in guidelines (61 Fed. Reg. 55156 (Oct. 24, 1996)).”
Promptly thereafter, on June 28, 2018, Genesis Healthcare commenced this action
against HHS and HRSA and requested (1) an emergency stay that would halt
implementation of HRSA’s allegedly wrongful decision to remove Genesis Healthcare
from the Program; (2) declaratory relief setting aside HRSA’s determinations; and

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(3) injunctive relief requiring HRSA to retract any notification of ineligibility that it had
provided to manufacturers.
In response to the suit, HRSA sent a letter issuing a revised final audit report dated
September 24, 2018, in which it vacated its sanction of removing Genesis Healthcare from
the 340B Program and promptly reinstated the company. But this revised report contained
the same findings that HRSA had made in its report of June 26, 2018. Again, the revised
report included statements that “the documentation GHI provided [was] insufficient to
show that all patient definition criteria were met (61 Fed. Reg. 55156 (Oct. 24, 1996))” and
that certain “instances [did] not meet the patient definition guidelines (61 Fed. Reg. 55156
(Oct. 24, 1996), . . . [and these] findings [were] not based upon withdrawn patient definition
guidance and do not represent a new HRSA interpretation.” The revised final report also
continued requiring Genesis Healthcare to reimburse manufacturers for the drug discounts
and to submit a corrective action plan (“CAP”) within 60 days. Finally, the letter stated
that failure to comply with the CAP requirements could lead to “termination from the 340B
Program.”
After Genesis Healthcare submitted a CAP, HRSA approved the plan by letter dated
March 20, 2019. But in its letter, it again instructed Genesis Healthcare that “with respect
to future implementation of the 340B Program,” the company had to comply with its
definition of “patient,” dedicating an entire paragraph to restating the specific
requirements. Without reiterating those requirements here, the letter stated that “HRSA
would like to clarify that in order for an individual to qualify as a 340B patient, GHI must
[comply with stated elements of the 1996 Guidelines definition of “patient”]. GHI must

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be able [with respect to future implementation] to demonstrate [those elements], in order
to meet the patient definition guidelines.” (Emphasis added).
In response to HRSA’s March 20, 2019 letter, Genesis Healthcare filed an amended
complaint. While it acknowledged in its amended complaint that it had been “promptly
reinstated into the 340B Program,” it stated that it had not dismissed the action due to
HRSA’s failure to “vacate its findings that Genesis violated the program requirements.” It
alleged that HRSA’s definition of “patient” has “never been promulgated by regulation”
and, in any event, “contradicts the plain language of the statute” by “improperly focus[ing]
on a patient’s prescription, and who wrote it, rather than the existence of a patient
relationship with Genesis [Healthcare] (or any other covered entity).” (Citing 42 U.S.C.
§ 256b(a)(5)(B)). For relief, Genesis Healthcare requested that the court (1) “declare that
the only statutory requirement for 340B eligibility of a person is that the person be a patient
of a covered entity, as clearly stated in 42 U.S.C. § 256b(a)(5)(B)”; (2) “declare that the
plain wording of 42 U.S.C. § 256b(a)(5)(B) requires that any prescription from any source
is available to a patient of a covered entity”; and (3) “declare any and all interpretations or
guidance of HRSA in contradiction of the plain wording of 42 U.S.C. § 256b(a)(5)(B)
unlawful and unenforceable as a matter of law.”
Finally, in response to Genesis Healthcare’s amended complaint, HRSA issued a
letter dated June 6, 2019, stating:
This communication serves as notice that [HRSA] has voided the audit
findings of the audit conducted . . . on June 21, 2017, through June 22, 2017
[including] the September 24, 2018 letter to GHI, the accompanying revised
final audit report to GHI, also dated September 24, 2018, and the March 20,
2019 letter approving GHI’s corrective action plan (CAP). As the audit

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findings have been voided, GHI has no further obligations or responsibilities
in regard to the audit.
And based on this letter, it filed a motion with the court a few days later to dismiss the
action as moot.
The district court granted HRSA’s motion by order dated December 19, 2019,
concluding that “the original final agency action” challenged by Genesis Healthcare was
“the agency’s determination that [Genesis Healthcare] was ineligible to continue
participating in the 340B Program,” which, the court noted, HRSA had “voided . . . in its
entirety.” As a result, the court concluded that “the parties ceased to have a ‘definite and
concrete’ controversy,” and it declined to “render . . . [an] impermissible advisory opinion”
in the absence of a live controversy. The court also denied Genesis Healthcare’s
subsequent motion for reconsideration.
This appeal followed.
II
On mootness, Genesis Healthcare contends that “[a]lthough the audit findings were
voided, a controversy still exists because HRSA’s unlawful guidance and interpretation of
the term ‘patient’ still exists,” and “there is a ‘substantial controversy’ between Genesis
and HRSA” over the point. It adds, “HRSA has the authority to conduct audits at any
time.” It could at any time “return to its old ways.” (Citing Friends of the Earth, Inc. v.
Laidlaw Env’t Servs. (TOC), Inc., 528 U.S. 167, 189 (2000)). It argues that a case becomes
moot in this kind of circumstance only “if subsequent events made it absolutely clear that

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the allegedly wrongful behavior could not reasonably be expected to recur.” (Quoting
Laidlaw, 528 U.S. at 189).
HRSA argues in response that because it voided the audit findings that were the
subject of Genesis Healthcare’s lawsuit, its “void notice therefore obviate[s] the basis for
Genesis’s lawsuit,” and any judicial advice over the meaning of the term “patient” would
only “‘satisfy [a] demand for vindication or curiosity’” and “‘advis[e] what the law would
be upon a hypothetical state of facts.’” (Quoting Norfolk S. Ry. Co. v. City of Alexandria,
608 F.3d 150, 161 (4th Cir. 2010), then Preiser v. Newkirk, 422 U.S. 395, 401 (1975)).
As is well understood, the Constitution limits the jurisdiction of federal courts to
deciding “Cases” and “Controversies.” U.S. Const. art. III, § 2. This requires a dispute
that is both “definite and concrete, touching the legal relations of parties having adverse
legal interests” and that is “real and substantial,” seeking “specific relief through a decree
of a conclusive character, as distinguished from an opinion advising what the law would
be upon a hypothetical set of facts.” MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118,
127 (2007) (quoting Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240–41 (1937)).
Moreover, this requirement must be satisfied at all stages of a federal court proceeding,
and if events subsequent to the commencement of the action resolve the dispute, the action
should be dismissed as moot. See Pashby v. Delia, 709 F.3d 307, 316 (4th Cir. 2013).
Federal courts have “no authority ‘to give opinions upon moot questions or abstract
propositions, or to declare principles or rules of law which cannot affect the matter in issue
in the case before it.’” Church of Scientology of Cal. v. United States, 506 U.S. 9, 12
(1992) (quoting Mills v. Green, 159 U.S. 651, 653 (1895)).

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The question presented by the circumstances of this case is whether HRSA’s
voluntary conduct in voiding its audit findings rendered Genesis Healthcare’s action
against it moot. In the context of a voluntary cessation of conduct, the Supreme Court has
set a high bar for finding the action moot, stating:
[T]he standard we have announced for determining whether a case has been
mooted by the defendant’s voluntary conduct is stringent: A case might
become moot if subsequent events made it absolutely clear that the allegedly
wrongful behavior could not reasonably be expected to recur. The heavy
burden of persuading the court that the challenged conduct cannot reasonably
be expected to start up again lies with the party asserting mootness.
Laidlaw, 528 U.S. at 189 (cleaned up). To address the question, we need to understand
what Genesis Healthcare sought to achieve with its litigation and what HRSA’s voluntary
action taken during the litigation obviated.
Genesis Healthcare’s complaint was filed fundamentally to challenge HRSA’s final
audit report of June 26, 2018, disqualifying Genesis Healthcare from the 340B Program
because, in part, the company was allegedly selling discounted drugs to non-patients, as
“patient” was defined by the “patient definition guidelines (61 Fed. Reg. 55156 (Oct. 24,
1996).” The report stated, “the documentation GHI provided [was] insufficient to show
that all patient definition criteria were met (61 Fed. Reg. 55156 (Oct. 24, 1996)). GHI has
not shown that it met the applicable elements of the current HRSA patient definition.” In
its complaint, Genesis Healthcare took issue with HRSA’s action, alleging that it “disputes
that it has wrongfully diverted covered outpatient drugs to any ineligible recipients.” For
relief, it sought declaratory and injunctive relief, challenging HRSA’s position and seeking
reinstatement.

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Responding to the portion of Genesis Healthcare’s complaint that challenged the
termination sanction imposed by HRSA, HRSA reinstated Genesis Healthcare to the 340B
Program. But it continued to enforce its definition of “patient,” directing, “with respect to
future implementation of the 340B Program,” that “patient” means what its 1996
Guidelines provided. It essentially repeated that “HRSA would like to clarify that in order
for an individual to qualify as a 340B patient, GHI must [comply with stated elements of
the 1996 Guidance definition]. GHI must be able [with respect to future implementation]
to demonstrate [those elements], in order to meet the patient definition guidelines.”
Genesis Healthcare amended its complaint to recognize its reinstatement into the
340B Program, but it maintained its challenge to HRSA’s definition of “patient” that would
continue to control its compliance with the Program, seeking a declaratory judgment that
“any and all interpretations or guidance of HRSA in contradiction of the plain wording of
the [governing statute] [is] unlawful and unenforceable as a matter of law.” It alleged that,
absent court relief, HRSA’s interpretation would “undermine[] the purpose of the 340B
Program, endanger[] the health of the most vulnerable patient population, and force[]
extreme limitations on the 340B program at the expense of Genesis and other 340B covered
entities who provide medical care to those who can least afford prescription medications.”
It alleged also that the absence of court relief would require Genesis Healthcare to make
changes to its own operations, materially affecting them. It alleged: “Genesis . . . will be
forced to dismantle and reconfigure its 340B program. . . . [And] Genesis itself may not
be able to survive.”

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In response to the amended complaint, HRSA sent another letter to Genesis
Healthcare, which voided all of its audit findings with respect to its June 2017 audit. It
then relied on that letter to support its motion to dismiss the action as moot.
It is decisive, however, that this HRSA letter voiding its audit findings said nothing
about how Genesis Healthcare was to continue to conduct itself under the 340B Program,
nor did it vacate or even address its 1996 Guidelines definition of “patient” that formed the
basis for its enforcement action and Genesis Healthcare’s lawsuit. Yet, Genesis Healthcare
remains subject to audit and, as the record stands, would still have to comply with HRSA’s
1996 Guidelines. Moreover, Genesis Healthcare has alleged that to comply with HRSA’s
definition of “patient,” it would have to “dismantle and reconfigure” itself, to its severe
disadvantage. The real issue thus remains, even after HRSA’s final letter, whether the
1996 Guidelines are inconsistent with the statute, as Genesis Healthcare has alleged and
with respect to which Genesis Healthcare sought a declaratory judgment.
We conclude that the ongoing disagreement over how “patient” is to be defined in
the context of the 340B Program is a definite and concrete controversy touching the
ongoing legal relations between HRSA, as regulator of the 340B Program, and Genesis
Healthcare, as a participant in the Program. This is not a case where Genesis Healthcare
is asking the federal courts for an advisory opinion on what the law is based on hypothetical
facts, nor is it simply an effort to satisfy a curiosity on who is right in a now defunct
controversy. HRSA has taken action against Genesis Healthcare based, in part, on its
definition of “patient,” and it can easily do so again in connection with its ongoing duty to
audit Genesis Healthcare’s compliance with the requirements of the 340B Program, as

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Genesis Healthcare remains a Program participant. Thus, even though HRSA did void its
audit findings, it has failed to carry its “heavy burden” of establishing “that the allegedly
wrongful behavior could not reasonably be expected to recur.” Laidlaw, 528 U.S. at 189
(citation omitted), cf. Del Monte Fresh Produce Co. v. United States, 570 F.3d 316, 321
(D.C. Cir. 2009) (recognizing that “a plaintiff’s challenge will not be moot where it seeks
declaratory relief as to an ongoing policy”).
We thus conclude that the district court erred in dismissing this action as moot.
III
The parties also engage each other in a confusing debate on the question of whether
Genesis Healthcare is challenging a “final agency action,” as required by the APA, 5 U.S.C.
§ 704, and, if not, whether the absence of a final agency action renders the case moot. The
confusion likely arises from the district court’s ruling, but it continues on appeal.
With respect to the final-agency-action requirement, the district court concluded that
“because there [was] no final agency action for Plaintiff to challenge under the APA, . . .
this case is moot.” It explained, “[T]he agency’s decision to void the audit produced no
‘appreciable legal consequences’ and is not a final agency action subject to review under
the APA.” (Quoting Bennett v. Spear, 520 U.S. 154, 178 (1997)). It continued linking
final agency action and mootness, stating that “because there is no final agency action,
there is no case or controversy,” leaving it only with the option to give “an impermissible
advisory opinion.” It is therefore apparent that the district court concluded that with

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HRSA’s withdrawal of its final audit report, HRSA eliminated any agency action and that
doing so rendered the case moot.
On appeal, HRSA maintains that the district court was correct. It argues that given
its withdrawal of the final audit report, Genesis Healthcare was left only with a challenge
to the “audit process,” and the audit process was “not a final agency action susceptible to
judicial review” under the APA, suggesting that the court no longer had before it a live
controversy, again linking “final agency action” with “mootness.” And Genesis
Healthcare’s rebuttal does not undo the confusion, accepting the same analytical
framework that links final agency action and mootness.
Unfortunately, the entire discussion confusingly mixes mootness and final agency
action, proceeding from the assumption that the presence of a final agency action is
necessary to maintain a live controversy. This assumption, however, is mistaken.
The role of the APA is to waive sovereign immunity for suits against the United
States for relief other than monetary damages brought by persons “suffering legal wrong,”
“adversely affected,” or “aggrieved by agency action.” 5 U.S.C. § 702; see also Nat’l
Veterans Legal Servs. Program v. U.S. Dep’t of Def., 990 F.3d 834, 839 (4th Cir. 2021);
City of New York v. U.S. Dep’t of Def., 913 F.3d 423, 430 (4th Cir. 2019). It provides a
cause of action to obtain judicial review of “final agency action for which there is no other
adequate remedy in a court.” 5 U.S.C. § 704; see also Lee v. U.S. Citizenship & Immigr.
Servs., 592 F.3d 612, 619 (4th Cir. 2010) (noting that the APA “provide[s] a limited cause
of action” (cleaned up)). The relief that can be given on such review is broad, and a
reviewing court is directed to “decide all relevant questions of law, interpret . . . statutory

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provisions, and determine the meaning . . . of the terms of an agency action.” 5 U.S.C.
§ 706. But the APA does not confer subject-matter jurisdiction on a court. See Califano
v. Sanders, 430 U.S. 99, 105 (1977) (holding that “the APA is not to be interpreted as an
implied grant of subject-matter jurisdiction to review agency actions”). That must be
demonstrated independently by statutory authority, such as by 28 U.S.C. § 1331
(conferring federal question jurisdiction). See Lee, 592 F.3d at 619.
The lack of a final agency action thus does not lead to a finding of mootness; rather,
it goes to the statutory requirements for suing an agency in court pursuant to the APA.
Once a plaintiff demonstrates to a court subject-matter jurisdiction and standing to
challenge a qualifying final agency action, it may seek and obtain any relief from the court
other than monetary damages. See 5 U.S.C. § 702; Muniz-Muniz v. U.S. Border Patrol,
741 F.3d 668, 672 (6th Cir. 2013). And this obviously includes declaratory relief that a
term relied on by the agency in its action has a different meaning than the one that the
agency gave to it. See 5 U.S.C. § 706. Mootness, on the other hand, can be found only
when there is no longer a live controversy between the plaintiff and the agency.
In this case, Genesis Healthcare commenced an action against HRSA, invoking
federal question jurisdiction under 28 U.S.C. § 1331 and challenging HRSA’s action
removing it from the 340B Program under the APA. Clearly, HRSA’s action was a final
agency action, as the district court noted:
In this case, the original final agency action was the agency’s determination
that Plaintiff was ineligible to continue participating in the 340B Program. It
“marked the consummation of the agency’s decisionmaking process” and
was one from which “legal consequences will flow.” Bennett, 520 U.S. at
178. At the time this action was filed, this was the final agency action

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Plaintiff sought to challenge in this Court, and this Court had jurisdiction to
review the agency’s decision declaring Plaintiff ineligible for participation
in the 340B Program.
Moreover, Genesis Healthcare’s challenge to the 1996 Guidelines was also likely a
challenge to a final agency action. See U.S. Army Corps of Eng’rs v. Hawkes Co., Inc.,
578 U.S. 590, 599–600 (2016) (explaining that the Court has “long taken” a “pragmatic
approach” to finality by recognizing, for example, that an agency order that “give[s] notice
of how the [agency] interpret[s] the relevant statute” is a final agency action even absent
an enforcement action against a particular party (cleaned up)). Furthermore, Genesis
Healthcare had standing to challenge the final agency action, as it was the party actually
removed from the 340B Program under HRSA’s final agency action enforcing the 1996
Guidelines and therefore suffered an adverse effect. And importantly, the agency did not
assert in response to Genesis Healthcare’s suit that its complaint had failed to challenge a
final agency action. Accordingly, the court had the broad charter of 5 U.S.C. § 706 to not
only grant injunctive relief for reinstatement but also to give declaratory relief with respect
to defining terms employed by the agency in its action. Thus, Genesis Healthcare satisfied
the requirements of the APA when it sued HRSA for both declaratory and injunctive relief.
The consequences of the agency’s subsequent withdrawal of its order (its final
agency action) during the course of litigation, however, are governed by the principles of
mootness, not by whether sovereign immunity was waived or a final agency action was
challenged. But the district court unfortunately blurred the distinction between the two
concepts, contributing to the parties’ confusion.

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We conclude that Genesis Healthcare satisfied the requirements of the APA when
it commenced this action against HRSA and that the disposition of this appeal — which
concerns the consequences of HRSA’s voluntary withdrawal of its order during the course
of the litigation — is governed by principles of mootness, as discussed above, not by the
APA’s final agency action requirement.
* * *
The judgment of the district court is reversed, and the case is remanded for further
proceedings.
REVERSED AND REMANDED

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