United States of America v. Michigan Department of Health and Human Services et al

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
UNITED STATES OF AMERICA,
Plaintiff,
v.
MICHIGAN DEPARTMENT OF HEALTH
AND HUMAN SERVICES, et al.,
Defendants.
___________________________________/
Case No. 1:26-cv-1950
Hon. Hala Y. Jarbou
OPINION
The Food and Nutrition Act of 2008 (FNA) authorizes the United States to obtain records
from states regarding their administration of the Supplemental Nutrition Assistance Program
(SNAP). In May through July of 2025, the United States issued a series of records requests to all
50 states. A group of states, including Michigan, refused to comply and asserted that the requests
were unlawful. Those states then sued the United States Department of Agriculture (USDA) in
the Northern District of California, seeking (and ultimately obtaining) an injunction to prevent the
federal government from withholding SNAP funds to enforce its requests. About a year later, with
the California litigation still pending, the United States filed this lawsuit against the Michigan
Department of Health and Human Services, requesting an injunction requiring Michigan to turn
over the records at issue. Before the Court is Michigan’s motion to stay the case under the first-
to-file rule pending the outcome of the California litigation (ECF No. 24). As explained below,
the Court will grant Michigan’s motion.
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I. BACKGROUND
SNAP is a federally funded food assistance program that is administered by the states. The
FNA, which authorizes SNAP, imposes requirements on states regarding their administration of
SNAP. Among other things, it provides that “[e]ach State agency shall keep such records as may
be necessary to determine whether the program is being conducted in compliance with this
chapter.” 7 U.S.C. § 2020(a)(3)(A). Moreover, “[a]ll records, and the entire information systems
in which records are contained, that are covered in subparagraph (A) shall . . . be made available
for inspection and audit by the Secretary [of Agriculture], subject to data and security protocols
agreed to by the State agency and Secretary.” Id. § 2020(a)(3)(B)(i). The statute specifies
procedures by which the United States can address state noncompliance with records requests,
including by withholding SNAP funds. Id. § 2020(g).
On May 6, 2025, the USDA sent a letter to the states notifying them of its intent to collect
the following information:
1. Records sufficient to identify individuals as applicants for, or recipients of,
SNAP benefits, including but not limited to personally identifiable information in
the form of names, dates of birth, personal addresses used, and Social Security
numbers.
2. Records sufficient to calculate the total dollar value of SNAP benefits received
by participants over time, with the ability to filter benefits received by date ranges.
(5/6/2025 Letter, ECF No. 1-3, PageID.45.) The USDA sent several follow-up letters in July,
setting a compliance deadline of July 30, 2025. (7/9/2025 Letter, ECF No. 1-4; 7/23/2025 Letter,
ECF No. 1-5, PageID.50; 7/25/2025 Letter, ECF No. 1-6.) The final letter stated that failure to
provide the requested records “may trigger noncompliance procedures codified in 7 U.S.C.
[§] 2020(g).” (7/25/2025 Letter, PageID.52.) Many states refused to comply on the grounds that
the requests were unlawful.
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On July 28, 2025, a group of noncompliant states—including Michigan—filed a lawsuit
against the United States in the Northern District of California. Compl., California v. USDA,
No. 25-cv-6310 (N.D. Cal. July 28, 2025), ECF No. 1. The states raised claims under the
Administrative Procedure Act and Spending Clause, as well as claims for ultra vires agency action.
The states sought a declaratory judgment that the United States’ demand for records was unlawful,
as well as an injunction to prevent the United States from seeking the records or initiating
noncompliance procedures and to prevent the USDA from disclosing the requested records to the
Department of Homeland Security or Department of Government Efficiency for any reason other
than SNAP administration.
On October 15, 2025, the California court granted the states’ motion for a preliminary
injunction preventing the United States from withholding SNAP funding based on the states’
failure to comply with the records requests. California v. USDA, No. 25-cv-6310, 2025 WL
2939227 (N.D. Cal. Oct. 15, 2025). The court held that § 2020(a)(3)(A) “requires USDA and a
State agency to agree to data and security protocols before the State agency is required to provide
the SNAP records demanded by USDA,” and that the records requests were invalid because no
such protocols had been agreed to. California, 2025 WL 2939227, at *7. The court also rejected
the United States’ alternative statutory basis for obtaining the records from the states. Id. at *10.
In November and December of 2025, the USDA sent new letters to the states demanding
SNAP records and specifying data security protocols that the government would follow. (See
11/24/2025 Letter, ECF No. 1-9; 12/23/2025 Letter, ECF No. 1-11.) On February 26, 2026, the
California court expanded its preliminary injunction to bar the United States from enforcing these
new demand letters as well. California v. USDA, 821 F. Supp. 3d 1015, 1036 (N.D. Cal. 2026).
The court held that the USDA’s new demand still did not satisfy § 2020(a)(3)(A) because the states
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had not agreed to the USDA’s proposed security protocols, and the states’ objections to those
protocols were not unreasonable. Id. at 1028–32.
The USDA responded to this injunction by sending a new set of records requests in May
of 2026, which proposed revised data security protocols. (5/15/2026 Letter, ECF No. 1-19.) The
states again refused to comply with the requests. (5/22/2026 Letter, ECF No. 1-20.) The United
States subsequently filed this lawsuit against Michigan for declaratory and injunctive relief under
§ 2020(g). That subsection provides that if a state fails to comply with a records request,
the Secretary may refer the matter to the Attorney General with a request that
injunctive relief be sought to require compliance forthwith by the State agency and,
upon suit by the Attorney General in an appropriate district court of the United
States having jurisdiction of the geographic area in which the State agency is
located and a showing that noncompliance has occurred, appropriate injunctive
relief shall issue . . . .
7 U.S.C. § 2020(g). The United States filed similar lawsuits against Kentucky, Minnesota, and
Pennsylvania. See United States v. Ky. Cabinet for Health & Family Servs., No. 26-cv-51 (E.D.
Ky. filed June 26, 2026); United States v. Minn. Dep’t. of Children, Youth, & Families, No. 26-
cv-3120 (D. Minn. filed June 26, 2026); United States v. Penn. Dep’t of Hum. Servs., No. 26-cv-
1787 (M.D. Pa. filed June 26, 2026).
On July 22, 2026, Michigan filed a motion in this Court to stay proceedings (ECF No. 14).
At the time, the states had a pending motion in the California court to enjoin the United States
from proceeding in this case based on the first-to-file rule; Michigan requested that this Court stay
proceedings until that motion had been resolved. On August 7, 2026, this Court denied the motion
for a stay. (8/7/2026 Order, ECF No. 22.) While the Court did not make any definitive ruling
regarding the application of the first-to-file rule, it noted that the rule was potentially inapplicable
because this case and the California case are not identical. It also cited an order from the related
litigation in Pennsylvania, where the court had similarly denied a stay based in part on the lack of
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similarity between the Pennsylvania and California lawsuits. See Order Denying Stay, United
States v. Pa. Dep’t of Hum. Servs., No. 26-cv-1787 (M.D. Pa. July 28, 2026), ECF No. 16.
On August 20, 2026, the California court denied the plaintiff states’ motion for an
injunction preventing the United States from proceeding in this lawsuit and in the Kentucky,
Minnesota, and Pennsylvania lawsuits. California v. USDA, No. 25-cv-6310, 2026 WL 2447539
(N.D. Cal. Aug. 20, 2026). The court held that the first-to-file rule did apply, but in the interests
of comity it declined to issue an injunction prohibiting this litigation. It noted that such an
injunction would be especially inappropriate given that both this Court and the Pennsylvania court
had cast doubt on the idea that the first-to-file rule applied. Id. at *4. However, it noted “that the
States remain free to bring a first-to-file motion in each of the Related Actions.” Id.
Subsequently, the Pennsylvania court held that the first-to-file rule applied, and stayed its
case pending resolution of the California case. Order Granting Stay, United States v. Pa. Dep’t of
Hum. Servs., No. 26-cv-1787 (M.D. Pa. Sep. 28, 2026), ECF No. 30. Michigan has filed an
analogous motion to stay this case under the first-to-file rule, which is now ripe for decision.
II. ANALYSIS
“The first-to-file rule is a prudential doctrine” that applies when two similar cases are filed
in different federal courts. Baatz v. Columbia Gas Transmission, LLC, 814 F.3d 785, 789 (6th Cir.
2016). The doctrine provides that “the court in which the first suit was filed
should generally proceed to judgment.” Id. Adhering to this rule promotes comity among the
federal courts, avoids “duplicative or piecemeal litigation, and protects the parties and the courts
from the possibility of conflicting results.” Id. The first-to-file rule only applies when two suits
are “duplicative,” which means they “involve nearly identical parties and issues.” Id. (internal
quotation marks omitted). Two sets of claims are “nearly identical” when the cases are “materially
on all fours and have such an identity that a determination in one action leaves little or nothing to
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be determined in the other.” Id. at 791 (internal quotation marks omitted). Even if the two cases
are nearly identical, “the court must also determine whether any equitable considerations, such as
evidence of inequitable conduct, bad faith, anticipatory suits, or forum shopping, merit not
applying the first-to-file rule in a particular case.” Id. at 789 (cleaned up). Ultimately, “[t]he most
basic aspect of the first to file rule is that it is discretionary.” Plating Res., Inc. v. UTI Corp., 47
F. Supp. 2d 899, 903 (N.D. Ohio 1999).
As an initial matter, the United States contends that Michigan’s motion for a stay should
be denied because it is “effectively seeking reconsideration of the Court’s prior order despite an
absence of any material change in circumstances.” (Pl.’s Opp’n Br. 1, ECF No. 28.) However,
the Court’s prior order did not definitively resolve the question of whether the first-to-file rule
applies. The Court found that “[a]t this stage, it appears that the California case may not be
‘materially on all fours’ with this one.” (8/7/2026 Order 3.) Since that order, the California court
has weighed in on the first-to-file issue and provided this Court with more clarity regarding what
legal claims will be covered in that case. The Court’s prior order also stated that briefing regarding
the United States’ motion for a preliminary injunction should go forward for the time being, as
“requiring Defendants to respond to the motion for preliminary injunctive relief in the ordinary
course will not impose a great hardship.” (Id. at 3.) Briefing on the preliminary injunction motion
is now complete, and the Court has had a fuller opportunity to consider whether the entire case
should be stayed. Thus, the Court will proceed to the merits of Michigan’s motion.
To determine whether the first-to-file rule applies, courts look to “three factors: (1) the
chronology of events, (2) the similarity of the parties involved, and (3) the similarity of the issues
or claims at stake.” Baatz, 814 F.3d at 789. The first factor supports application of the first-to-
file rule because the California action was filed eleven months before this action. The second
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factor also supports application of the rule. The parties to the two lawsuits need not be “perfectly
identical” as long as they “substantially overlap.” Id. at 790 (alteration omitted). Substantial
overlap exists “if some [of] the parties in one matter are also in the other matter, regardless of
whether there are additional, unmatched parties in one or both matters.” Levang v. Kappa Kappa
Gamma Fraternity, No. 24-cv-316, 2024 WL 6048247, at *9 (S.D. Ohio Dec. 19, 2024) (alteration
in original) (quoting Youngevity Int’l, Inc. v. Renew Life Formulas, Inc., 42 F. Supp. 3d 1377, 1382
(S.D. Cal. 2014)). Although the California case involves states other than Michigan, the additional
states have little impact on the litigation because they are all asserting the same collective claims.
See id. (additional parties do not defeat similarity if they assert the same claims as matching
parties). It is also true that the California case involves the USDA instead of the United States,
and the state of Michigan instead of the Michigan Department of Health and Human Services. But
this distinction is irrelevant because these agencies represent the interests of their respective
governments. See Buff City Soap LLC v. Bynum, No. 21-2462, 2022 WL 1285045, at *5 (W.D.
Tenn. Apr. 29, 2022) (“Courts generally hold that privity or affiliation between/among [parties] is
sufficient to find ‘substantial overlap.’”). Thus, the parties are sufficiently similar.
Moving to the third factor, the parties disagree as to how much the issues presented in the
two lawsuits overlap. Both lawsuits turn on the same legal issue—namely, the scope of
§ 2020(a)(3)(B)(i), the provision of the FNA that permits records requests. In both cases, the
outcome hinges on whether state approval of the federal government’s data security protocols is
necessary to enforce a records demand under the FNA, and whether the particular security
protocols proposed are reasonable. However, the United States argues that the claims here and in
California are not identical because the California suit addresses only the first two sets of demand
letters (sent in July of 2025 and November of 2025) whereas this lawsuit addresses only the third
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set of demand letters (sent in May of 2026).1 It is true that the legal questions posed by the different
demand letters are conceptually distinct, as the analysis turns on the specific protocol outlined in
each letter. If the California court holds that the data security protocols in the second letter are not
reasonable, that decision would not resolve the question of whether the protocols in the third letter
are reasonable.
However, this distinction is only relevant in theory; as a practical matter, the California
court will likely resolve the legality of the third demand letter as well. The California court has
noted that, “[a]lthough the Third Data Request is accompanied by a revised protocol as to which
th[e] [California] Court has not ruled, said protocol, given the evolving nature of the instant action,
will, in all likelihood, be presented to th[at] Court as well.” California, 2026 WL 2447539, at *3.
Since the California court has a better understanding of the ongoing litigation there than this Court,
it is prudent to defer to the California court’s prediction regarding the scope of that litigation.
Moreover, the third demand letter expressly provides that the first two letters are “withdrawn” and
“supersede[d].” (6/26/2026 Letter, PageID.209.) It is reasonable to infer that the California
litigation will focus on the third demand letter, given that any dispute regarding the first two letters
seems moot. Thus, the discrepancy between the demand letters does not entail that the California
and Michigan cases are distinct. See also Order Granting Stay 13–18, United States v. Pa. Dep’t
of Hum. Servs., No. 26-cv-1787 (finding Pennsylvania and California cases substantially similar
for first-to-file purposes).
The United States also contends that this case is distinct from the California case because
here it has requested an injunction requiring the states to comply with the records demand, whereas
1 In their initial complaint in California, the states only addressed the first set of letters; they have since filed an
amended complaint that addresses the second set of letters. See 2d Am. Compl., California v. USDA, No. 25-cv-6310
(N.D. Cal. April 3, 2026), ECF No. 146.
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it has not done so in California. However, the fact that these cases involve different forms of
relief—an injunction against the United States preventing it from enforcing its records demand, or
an injunction against Michigan requiring it to comply with the demand—does not entail that they
are dissimilar. Courts frequently find cases to be nearly identical for first-to-file purposes even
though they involve different forms of relief: for instance, Party A sues Party B for an injunction
or damages, and Party B sues Party A for a declaratory judgment. See, e.g., Clear!Blue, LLC v.
Clear Blue, Inc., 521 F. Supp. 2d 612, 614–16 (E.D. Mich. 2007); Malibu Boats, LLC v. Nautique
Boat Co., No. 13-cv-656, 2014 WL 202379, at *3 (E.D. Tenn. Jan. 16, 2014); Encore Furniture
Thrifts & More, LLC v. Doubletap, Inc., 281 F. Supp. 3d 665, 669 (M.D. Tenn. 2017); see also
Nat'l Union Fire Ins. Co. of Pittsburgh v. Payless Shoesource, Inc., No. C-11-1892, 2012 WL
3277222, at *3 (N.D. Cal. Aug. 9, 2012) (“The form of relief sought does not determine the
similitude of the issues.”).2 If the California court rules for the United States, the United States
can immediately move for an injunction in this Court, and the appropriateness of that injunction
will be almost entirely dictated by the California court’s legal conclusions. Thus, the California
court’s inability to issue an injunction against the states does not make the two actions
meaningfully distinct.
This case is a far cry from Smith v. S.E.C., 129 F.3d 356, 360 (6th Cir. 1997), cited by the
United States, in which the Sixth Circuit held that a lawsuit regarding the legality of evidence
collected by the government was not identical to a subsequently filed enforcement action in which
the government sought to use that evidence. The court explained that the cases overlapped to some
degree—both would address the legality of the evidence—but the enforcement lawsuit addressed
2 Of course, a declaratory judgment suit that is filed before an anticipated coercive suit will often raise the spectre of
forum-shopping, making the first-to-file rule potentially inapplicable. See Baatz, 814 F.3d at 789. But the issue of
whether an equitable exception precludes application of the first-to-file rule is distinct from the issue of whether the
two cases are sufficiently similar to invoke the rule in the first place.
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an issue not present in the evidentiary lawsuit, namely, whether the defendant was liable for insider
trading. Id. at 361. So even if the first court had held that the evidence had been legally (or
illegally) collected, the second court would still have to resolve the defendant’s liability, which
was the key issue in the second case. Here, by contrast, if the California court decides that the
third demand is valid (or invalid), the only remaining question for this Court will be the propriety
of an injunction—which, again, will be largely resolved by the California court’s holding. That
sequence of events would be far more economical than if both courts proceeded to the merits,
expending significant time and money on duplicative litigation and potentially producing
conflicting rulings or contradictory injunctions.
The United States also suggests that § 2020 poses a unique obstacle to application of the
first-to-file rule because Congress specifically provided for venue for an action in this Court and
staying this case would “obstruct a congressionally authorized enforcement action pending before
the court empowered to adjudicate it.” (Pl.’s Opp’n Br. 11.) But nothing in § 2020(g) implies an
intent to circumvent normal application of the first-to-file rule. And the venue provision in
§ 2020(g), which requires the United States to sue state agencies in the district where they are
located, appears intended to benefit the states rather than the federal government (which is
essentially at home in every state). So it is not clear that the venue provision’s intent is contravened
where Michigan has chosen to litigate this issue in California. Moreover, staying the case does
not “obstruct” the United States’ attempt at enforcement; that enforcement attempt may continue
apace once a final ruling is issued by the California court—which, it is worth noting, is further
along in its case and should reach a judgment significantly before this Court would.
Of course, the quickest way for the United States to enforce its records request would be
to obtain a preliminary injunction from this Court—an option that will be foreclosed by a stay of
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this case. But the United States does not explain why it cannot raise a counterclaim in the
California court and seek preliminary injunctive relief there.3 Indeed, in a hearing before the
California court, the United States indicated that it planned to bring a counterclaim seeking
“affirmative relief.” (4/15/2026 Cal. Hr’g Tr. 19, ECF No. 23-5.) Thus, the Court is unpersuaded
by the United States’ assertion that maintaining this separate action is necessary to expeditiously
obtain the records it has demanded.
In sum, because the California litigation will likely resolve the core legal issue presented
here—namely, whether the data security protocols proposed in the third letter are reasonable—the
cases are substantially identical, such that resolution of one will leave almost nothing to resolve in
the other. See Fuller v. Abercrombie & Fitch Stores, Inc., 370 F. Supp. 2d 686, 690 (E.D. Tenn.
2005) (first-to-file rule applies where “crucial issue in both cases” is the same); Aero Advanced
Paint Tech., Inc. v. Int’l Aero Prods., LLC, 351 F. Supp. 3d 1067, 1072 (S.D. Ohio 2018) (first-to-
file rule applies where claim “at the heart of both cases” is the same). The United States does not
assert that any equitable exceptions counsel against application of the first-to-file rule, and the
Court does not find any to be relevant. Although courts will often decline to apply the rule when
the first-filed suit is a declaratory judgment action intended to preempt an anticipated coercive suit,
see Certified Restoration Dry Cleaning Network, L.L.C. v. Tenke Corp., 511 F.3d 535, 552 (6th
Cir. 2007), the California plaintiffs sought injunctive rather than merely declaratory relief, and
there is no evidence that they sued in anticipation that this suit would be filed almost a year later.
3 It is true that § 2020(g) contains a venue provision requiring the United States to sue Michigan in this district. But
venue limitations do not generally apply to counterclaims, because a plaintiff waives any venue-related objections by
suing the defendant in a given forum. Gen. Elec. Co. v. Marvel Rare Metals Co., 287 U.S. 430, 435 (1932).
Admittedly, a counterclaim under § 2020(g) may be somewhat procedurally awkward, given that the statute provides
an enforcement mechanism for records requests rather than a more traditional right of action. But again, the United
States has not contended that it is unable to bring a counterclaim under § 2020(g) (it has in fact implied the opposite),
and the Court will not make such an argument on its behalf.
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Finally, the United States argues that the Court should deny Michigan’s motion because
the state has not shown that “a clear case of hardship or inequity” would result from the absence
of a stay. Landis v. N. Am. Co., 299 U.S. 248, 255 (1936). While this standard applies to certain
requests for stays, it is inapposite when granting a stay pursuant to the first-to-file rule, which is
grounded in comity and efficiency rather than the individual interests of the parties. In fact,
“deviations from the [first-to-file] rule should be the exception, rather than the norm.” Baatz, 814
F.3d at 792. Case law implies that the presence of duplicative claims and parties is sufficient to
invoke the first-to-file rule—no hardship analysis is necessary. See id. at 789. The Court therefore
finds that the first-to-file rule applies, and that a stay of this action is warranted. See id. at 793
(staying second-filed case is one way to enforce first-to-file rule).
An order will enter in accordance with this Opinion.
Dated: October 13, 2026 /s/ Hala Y. Jarbou
HALA Y. JARBOU
CHIEF UNITED STATES DISTRICT JUDGE
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