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populations, geographic areas of the health service area, and major purchasers of health care." 3 42 U.S.C. § 3001-1(b) (3)(C)(i); 42 CFR 122.109(f)(1). Plaintiffs' Counts I and II concern the alleged under-representation of low income consumers. Plaintiffs also insisted, in Counts III and IV, that the Board's method of selection violated the purposes and provisions of the Planning Act and, in the alternative, that the Planning Act was unconstitutional.

The parties entered into a Stipulation and Agreed Order which enjoined HSA from entering into any contracts or making any grants for health planning. The Order did grant HSA the permission to continue carrying on its day-to-day activities. Plaintiffs then filed a Motion for Partial Summary Judgment on Counts I and II, which the court granted. HSA and HEW have both perfected their appeals from this Order completely enjoining HSA from all operations.

Four issues are paramount. First, there are jurisdictional problems with regard to 3. 42 U.S.C. § 3001 −1(b)(3)(C)(i) provides in full: The membership of the governing body and the executive committee (if any) of an agency shall meet the following requirements: (i) a majority (but not more than 60 per centum of the members) shall be residents of the health service area served by the entity who are consumers of health care and who are not (nor within the twelve months preceding appointment been) providers of health care and who are broadly representative of the social, economic, linguistic and racial populations, geographic areas of the health service area, and major purchase of health care.

Section ii further provides that the remaining members shall be providers representing physicians, nurses, health care institutions, health care insurers, health professional schools, and the allied health professions.

4. 28 U.S.C. § 1331(a), as amended, provides: The District Courts shall have original jurisdiction of all civil actions wherein the matter in controversy exceeds the sum or value of $10,000, exclusive of interest and costs, and arises under the Constitution, laws or treaties of the United States except that no such sum or value shall be required in any such action brought against the United States, any agency thereof, or any officer or employee thereof in his official capacity.

the federal (HEW) and private (HSA) defendants. Second, both appellants argue tt the District Court erroneously construed the Planning Act to require that a representative of a particular economic stratum have an income which is the same as that of his constituency. Third, the appellants argue that the District Court ignored genuine issues of material fact. Finally, HEW in particular argues that the District Court utilized the wrong standard to review the Secretary's decision.

1.

[1,2] A. Jurisdiction over HEW. The recent amendment to 28 U.S.C. § 1331(a) removes the amount-in-controversy requirement in suits to review federal agency action. Not surprisingly, HEW declines to argue the jurisdictional point, conceding that the District Court could obtain jurisdiction over it. The Northern District of New York recently reached the same conclusion in a case with similar facts. Aldamuy v. Pirro, 436 F.Supp. 1005 (N.D.N.Y. 1977) (Civ. # 76-CV-204).5

5. The Aldamuy court also notes that the Administrative Procedure Act, 5 U.S.C. §§ 701-06 governs judicial review of the Secretary's approval of the HSA. While that Act does not afford an implied grant of subject-matter jurisdiction permitting federal judicial review of agency action, Califano v. Sanders, 430 U.S. 99. 97 S.Ct. 980, 51 L.Ed.2d 192 (1977), the plaintiffs here key their complaint to a specific stat utory mandate: 42 U.S.C. § 3001-1(b)(3)(C)(i). Unlike the provision of the Social Security Act that barred judicial review in Califano, 42 U.S.C. § 405(g), the National Health Planning and Resources Development Act does not preclude judicial review. The Supreme Court in Califano noted that "the obvious effect of this modification [amendment to 28 U.S.C. § 1331(a) removing amount-in-controversy requirement), subject only to preclusion-of-review statutes created or retained by Congress, is to confer jurisdiction on federal courts to review agency action, regardless of whether the APA of its own force may serve as a jurisdictional prerequisite." Califano, supra, 430 U.S. at 105-106, 97 S.Ct. at 984. See also Toilet Goods Ass'n v. Gardner, 387 U.S. 158, 87 S.Ct. 1520, 18 L.Ed.2d 697 (1967) (only upon a showing of clear and convincing evidence of a contrary legislative intent should the courts restrict access to judicial review of administrative action); Aldamuy v. Pirro, supra.

HSA.

The

[3] B. Jurisdiction over amendment to 28 U.S.C. § 1331(a) removes the amount-in-controversy requirement as to the federal defendant but it has no effect on the HSA. The appellees argue that we can obtain jurisdiction over the HSA by using § 1331(a) and exercising pendent jurisdiction. Since the action is against the United States, the pendent jurisdiction doctrines allegedly permit joinder of non-federal defendants. Appellees argue to no avail. The HSA may not be brought into the suit as pendent parties unless an independent basis of jurisdiction over it exists. See Aldinger v. Howard, 427 U.S. 1, 96 S.Ct. 2413, 49 L.Ed.2d 276 (1976).

[4] Appellees cannot satisfy the amount-in-controversy requirement. They have not offered any evidence of potential or direct injury to themselves, beyond merely pointing out that the HSA has received funds totalling $771,535 from HEW and will probably receive millions of dollars within the next several years. Surely a plaintiff cannot satisfy the jurisdictional amount any time a private defendant's annual budget exceeds $10,000. See Aldamuy, supra; Carman v. Richardson, 357 F.Supp. 1148 (D.Vt.1973). In actions for injunctive and declaratory relief, the jurisdictional amount is the value of the right to be protected or the extent of the injury to be prevented. Mississippi & M.R. Co. v. Ward, 67 U.S. (2 Black) 485, 17 L.Ed. 311 (1867); Flato Realty Invs. v. City of Big Spring, 388 F.Supp. 131 (N.D.Tex.1975), aff'd without opinion, 519 F.2d 1087 (5 Cir. 1975); 14 Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction § 3708.6

}

Plaintiffs do not seek the permanent cessation of all funds to the Texas Area 5 HSA, nor do they claim that $771,535 is excessive. Quite the contrary, plaintiffs

6. This is a general rule, applicable to other causes of action as well. See, e. g., Koster v. Lumbermens Mut. Cas. Co., 330 U.S. 518, 67 S.Ct. 828, 91 L.Ed. 1067 (1947); Kimball v. Callahan, 493 F.2d 564 (9 Cir., 1974), cert. denied, 419 U.S. 1019, 95 S.Ct. 491, 42 L.Ed.2d 292 (1974); Waller v. Professional Ins. Corp., 296 F.2d 545 (5 Cir., 1961).

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deem themselves major beneficiaries of the funding, and demand an end to an alleged deprivation of their right of adequate representation on the Board. They seek reconstitution, not abolition. Their object is not direct participation in the budget, but the right to adequate representation on the Board and Committee, specifically that the Board have more members with incomes less than $10,000. The injury to each individual plaintiff,' even if we could reduce it to a monetary standard, would be small indeed. Since each plaintiff's claim is separate and distinct, each must rest on its own independent jurisdictional amount. Plaintiffs cannot aggregate them. Zahn v. International Paper Co., 414 U.S. 291, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973); Clark v. Gray, 306 U.S. 583, 59 S.Ct. 744, 83 L.Ed. 1001 (1939).

In fact, plaintiffs cannot reduce such a speculative benefit to a monetary standard, so there is no pecuniary amount in controversy. See, e. g., Hague v. CIO, 307 U.S. 496, 59 S.Ct. 954, 83 L.Ed. 1423 (1939); Amen v. City of Dearborn, 532 F.2d 554 (6 Cir. 1976); Senate Select Committee on Presidential Campaign Activities v. Nixon, 366 F.Supp. 51 (D.C.D.C.1973). Plaintiffs admit that the injury they complain of is not that any specific decisions of the HSA will be altered, but that they have suffered a denial of "representational rights" granted by 42 U.S.C. § 3001-1(b)(3). (R. 219). A monetary standard requires an injury far less conjectural and speculative than this alleged dilution of representation on an HSA Board. Plaintiffs failed to demonstrate even an approximate dollar value of the relief sought or alleged injury. That failure is no surprise, since such a task would be impossible. Even if a dollar figure could be placed on representational rights on an HSA Board, the amount would 7. Texas Acorn asserts that it is an unincorporated association with state-wide membership composed of Texas residents with low to mod. erate family income levels. At least 1500 families are members. (R. 395).

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be insignificant. On the basis of the record, the District Court committed clear error in holding that the jurisdictional sum had been met.9

II.

Appellant submits a two-pronged attack on the District Court's construction of § 300/1(b)(3)(C)(i), since the court interpreted the provision to mean that the membership of the governing bodies must correlate with an economic and demographic study of Texas Area 5, and also that an individual must have an annual income less than the median to represent the lower economic strata. Neither interpretation is accurate.

[5] The district court relied on a preamble to the HSA regulations to support his holding that 50 percent, with an allowable variance of up to 10%, of the Board must be persons with a family income below the median. The preamble stated that the "consumer majority should roughly approximate, in its representational aspects, the whole population of the health service area." 41 Fed.Reg. 12812, 12820 (March 26, 1976).10 We reject the notion that the terms "broadly representative" and "roughly approximate" require the application of a formula to produce a governing body whose consumer membership is evenly divided be tween persons whose income is below and those whose income is above the median for

8. Though perhaps valuable, representational rights on an HSA Board of Directors certainly do not rise to the level of a constitutional guarantee. Yet even in cases where fundamental constitutional rights are at stake, satisfaction of the amount in controversy is a prerequisite to jurisdiction under § 1331. See, e. g., Lynch v. Household Fin. Corp., 405 U.S. 538, 92 S.Ct. 1113, 31 L.Ed.2d 424 (1972).

9. We wonder whether this point has much ultimate significance. Surely the HSA would be seeking to intervene, were the litigation to continue against HEW without it.

10. The preamble states in full:

Recognizing the extreme complexity and variety in designated health service areas, the Department wishes, at this stage, to give as much discretion as legally permissible to health systems agencies. The Department does state that in its view although the term "broadly representative" does not necessitate

the area. Instead, we hold that phrases like "extreme complexity and variety," "as much discretion as legally permissible," and "does not necessitate an equal proportion," all also found in the same preamble," demonstrate beyond cavil that the Secretary is encouraging, not a rigid formula, but broad community representation so that the Board will invariably consider the needs of diverse groups in the community. Certainly the health needs of our low income citizens are crucial, and undeniably the HSA's must listen to their voices. Nowhere, however, does Congress or the Secretary state that the membership on the Board has to conform directly to the demographic breakdown of the area population.

[6] Nor does Congress or the Secretary insist that an individual must have an income equal to that of the constituency he or she represents. Indeed, the proposed "Draft Guidelines Covering Governing Bodies for Health Systems Agencies" (October, 1976) circulated by HEW, listed a wide variety of useful skills for governing body members, including inter alia, experience on deliberative bodies and in leading meetings, skill in communicating with a variety of community groups, demonstrated ability to negotiate and mediate, understanding and appreciation of different perspectives in the community, credibility with community groups, legal training and experience. In

an equal proportion, it does indicate that the consumer majority should roughly approximate, in its representational aspects, the whole population of the health service area. 11. See n. 10, supra.

12. R. 133. See also Report of Committee on Interstate and Foreign Commerce's first annual review of the Planning Act, which stated:

This ["broadly representative" requirement] has led to expectable debate over whether adequate representation has been given to poor people, rural areas, women and so forth. Here there is a need in the future to strike a difficult balance between assuring, on the one hand, that all parties are adequately represented and requiring, on the other hand, representation so rigidly proportional to various people's proportion of the population that the process is paralyzed by the requirements. H.R.REP.NO.95–116, 95th Cong., Ist Sess. 12 (March 26, 1977).

III.

The District Court entertained no evitence before determining that only persons with incomes below the median could represent low-income consumers, and holding hat low-income consumer representation as inadequate. Admittedly, HEW created roblems for itself with its reply to an Interrogatory asking the names of members who are representative of low income consumers. HEW responded by listing four Board members, one of whom was a provider, whose incomes were under $10,000. (R. 395).

In its brief, HEW admits that it phrased the answer poorly, and explains that it attempted to identify those Board members who fall into the low income category. The HEW did not intend to list all persons who represent low income consumers on the Board, nor did it intend to admit that the Board is not "broadly representative." (Brief at 23-24). Whether or not HEW's response was an honest mistake or poor articulation, no one can deny that the HEW

13. A recent Conference Committee Report buttresses our conclusion that the income and representation guidelines are flexible ones. The Report, which concerns amendments to the Public Health Service Act under HR 49-75, states in pertinent part as follows:

"The conferees also wish to clarify the original intent of the Health Planning and Resources Development Act with respect to the composition of governing bodies of health systems agencies. * In particular, it was

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took the position throughout the proceedings and in the District Court that there is no requirement that low income consumer representatives have low incomes. It is also of record that HEW denied plaintiffs' allegation that the Board was not broadly representative of the low and moderate income consumers of Texas Area 5. (HEW Answer to 14 of the Complaint).

Al

[7] HEW also relies on the HSA's response to the same interrogatory. though we have found that the court has no jurisdiction over the HSA, the District Court considered the HSA's answers and yet ignored their import. The HSA identified some 29 members of the Board whom they deemed representative of low and moderate income consumers. In its answer, the HSA listed five criteria which it used in selecting the membership of the Board." These 29 members all had been selected on the basis of one or more of the criteria. Some of the criteria would seem to insure representation of groups overlapping with but not congruent to the low income consumer segment of the population (minorities, for example), but the point is again that we do not believe that only consumers with low incomes can represent low income consumers. The trial court, by granting summary judgment, did not give defendants an adequate opportunity to demonstrate the way in which consumer members of the Board who make more than $10,000 per year may be representative of low income consumers, and to prove that the Board was "broadly representative" of the

that

tives of a category be members of the class they represent. Instead, the Congress intended health systems agencies have the flexibility to adopt selection processes most appropriate to local needs."

Congressional Record, H 7121, at H 7127 (July 14, 1977).

14. The five criteria included: "income of less than $15,000; a member of an ethnic minority; a public official or employee of a Federal agency; a representative designated by the coalition of community action agencies which formed a part of the compromise application; and representatives of consumer and other groups." (R.