State Appeals Court will not rehear case challenging certificate-of-need restrictions

State Appeals Court will not rehear case challenging certificate-of-need restrictions


The N.C. Court of Appeals has denied a New Bern eye surgeon’s request to reconsider his challenge against state certificate-of-need restrictions. The court rejected the request without comment Friday.

A unanimous three-judge Appeals Court panel dismissed Dr. Jay Singleton’s lawsuit on June 21. Singleton filed paperwork Monday asking for a rehearing of the case.

“This Court’s opinion made fixable errors with grave consequences,” wrote Singleton’s attorneys from the Institute for Justice.

Singleton objects to North Carolina’s law requiring him to secure a government certificate of need before he can perform most eye surgeries at his Singleton Vision Center. His lawsuit contends that the CON law violates three sections of the N.C. Constitution.

“Dr. Singleton alleges that the CON law, as applied, violates his rights to liberty under the law of the land (Section 19) and to be free from unconstitutional exclusive privileges (Section 32) and monopolies (Section 34),” according to the petition.

“This Court rightly concluded that North Carolina’s ‘CON statutes are restrictive, anti-competitive, and create monopolistic policies and powers,’” Singleton’s lawyers argued. “Yet the Court dismissed Dr. Singleton’s anti-exclusive privileges and anti-monopoly claims for failure to exhaust administrative remedies. The Court did so only because it misapprehended and overlooked key points of fact and law.”

Singleton, a board-certified ophthalmologist, has owned and operated Singleton Vision Center in New Bern since 2014. His “full-service” clinic provides “routine vision check-ups, treatments for infections, and surgery,” according to the court ruling.

The CON law forces Singleton to perform most surgeries at New Bern’s Carolina East Medical Center, “the only licensed provider with an operating room certificate of need located in the tri-county planning area of Craven, Jones, and Pamlico Counties.”

Singleton filed suit in 2020 to challenge CON restrictions. Institute for Justice lawyers have helped him pursue the case.

“Plaintiffs acknowledge they could have applied for a CON and have sought and challenged any administrative review to invoke or ripen their constitutional procedural due process claims,” Judge John Tyson wrote for the unanimous Appeals Court panel in June. “Plaintiffs failed to file an application for a CON or to seek or exhaust any administrative remedy from DHHS prior to filing the action at bar. Plaintiff has not shown the inadequacy of statutorily available administrative remedies to review and adjudicate his claims to sustain a deprivation of procedural due process.”

“The remedy Plaintiffs admittedly and essentially seek is for a fact-finding administrative record and decision thereon to be cast aside and a CON to be summarily issued to them by the Court,” Tyson added. “This we cannot do.”

“Had Plaintiffs sought any administrative review or the procedures were shown to be inadequate, their claim would be ripe for the superior court to exercise jurisdiction over their procedural claims,” Tyson wrote.

Despite ruling against Singleton, Tyson noted concerns about North Carolina’s CON process.

“While counsel for Defendants clearly and correctly admitted the CON statutes are restrictive, anti-competitive, and create monopolistic policies and powers to the holder, and Plaintiffs correctly assert the CON process is costly and fraught with gross delays, and service needs are not kept current, those challenges can also be asserted before the General Assembly, Commissions, and against the agency where a factual record can be built,” Tyson wrote.

“At least 12 sister states, including New Hampshire, California, Utah, Pennsylvania, and Texas, have re-examined the anti-competitive, monopolistic, and bureaucratic burdens of their CON statutes’ health care allocations, and the scarcity created by and delays inherit [sic] in that system, and have abolished the entire CON system within their states,” he added.

Tyson suggested other avenues for addressing CON concerns in the future.

“Plaintiffs’ complaint has also not asserted a violation of North Carolina’s unfair and deceptive trade practices or right to work statutes,” he wrote. “Plaintiffs also failed to assert it had sought re-classification of certain surgical and treatment procedures under its medical or other licenses and certifications, which can be safely done at its Center and clinic, without the need for a CON operating room.”

“Advances in lesser and non-invasive procedures and technological treatments develop rapidly and have reduced or eliminated the need for a traditional operating theater and allowed for ambulatory clinical environments for patients,” Tyson added.

“We express no opinion on the potential viability, if any, of claims not alleged in this complaint,” Tyson wrote.


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