2008 D e c i sion s O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit 5-21-2008 

# D eptford T wp S ch v . H.B . P r e c e de nt i al or N on-P r e c e de nt i al : N on-P r e c e de nt i al D ocke t N o . 07-1185

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Thi s de c i sion i s br ou ght t o you for f r e e and ope n a c c e s s b y the O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit at V i ll anova U nive r sity S choo l of L a

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wp S ch v . H.B . " (2008). 2008 D e cisio n s . P ape r 1181. http://d i git alc ommon s .l a

w . vi ll anova . e du/thir dc ir c uit_2008/1181NOT P RE CE DE NT I AL UN I TED STATES CO UR T OF A PP EALS F O R T H E T H IR D C IR C U IT

____________ N o. 07- 1185

____________ DEPTFORD TOW NSH I P S CH OO L DI STRI CT,

A p p e llan t,

v. H . B . , byher parent s and legal gu ardi ans, E . B . and P. B . ; E . B . , par entand l egal guar di an; P. B . , par entand l egal guar di an, D efen dan t s/ T hir d-PartyP l ai nti ffs, v. R A Y M O N D SH E R M A N , i n hi s offi ci al capa ci tyas D ir ec tor o f S p ec ial E d u ca ti o n fo r D ep tfo rd T o wn s h i p S c h o o l Di s tr i c t ; BA RB AR A GANT WER K, i n heroffi ci al capa ci tyas D i r ect orof the N ew J er s eyO ffi ce of Speci al E ducat i on; A T T O R N E Y G E N E R A L O F N E W J E R SE Y , i n hi s offi ci al c a p a c i ty a s A t t o r n e y G e n e r a l o f th e S t a t e o f

N e w J e r s e y, T hir d-PartyD efen dan t s.

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ro m U n ited S tate s D istric t C o u rt forthe D i s tr i ctof N ew J er s ey D . C . N o. 01- cv- 00784 D istric t Ju d g e : H o n o ra b le J e ro m e B . S im a n d le

____________2 A r gued M ay5, 2008 B e f o re : S C IR IC A , C hi ef

Judge , B A R R Y , a n d H A R D IM A N , C i r cui tJudges . ( Fi l ed: M ay21, 2008) J ames F. Schw er i n ( A r gued) Par kerM cC ay 1009 L enox D r i ve B ui l di ng 4 E as t , Sui t e 102A L aw r ence vi l l e, N J 08648- 0000 A t t or ney f

orAppel lant J ami e Epst ei n ( A r gued) 11 01 R ou t e 70 W est C herryH i l l , N J 08002- 0000 A t t or ney f

orAppel l ees

____________

OPI NI ON O F THE COURT

____________ H A R D IM A N , C i r cui tJudge . D ept for d T ow ns hi p School D i s tr i ctappea l s the D i s tr i ctC our t ’ s aw ar d of att orney s ’ fee s t o H . B . and herpar ent s E . B . and P. B . ( A ppel l ees ) pur s uantt o the I ndi vi dual s W i th D i s abi l i t i es i n E ducat i on A ct( I D E A ) . B eca us e w e conc l ude that A ppel l ees w er e notthe “pr evai l i ng party , ” w e w i l l r ever s e. I. A s w e w r i t e exc l us i vel yforthe part i es , w e r ecountonl ythos e fa ct s es s ent i al t o our deci s i on.3

H . B . i s an aut i s t i c chi l d w ho qual i fi es foreduca t i onal s ervi ces underthe I D E A , 20 U .S .C . § 1 4 0 0 , et

s eq . H . B . began a t t endi ng s chool i n the D ept for d T ow ns hi p School D i s tr i cton February16, 1999. Shor t l yther eaf t er , H . B . ’ s par ent s m etw i th hereduca t i onal te a m to p re p a re a n In d iv id u a liz e d E d u c a tio n P ro g ra m (I E P ) f o r t h e u p c o m in g s c h o o l yea r. See 20 U . S. C . § 1414( d) . A ft erH . B . ’ s par ent s obj ect ed t o the I E P pr opos ed bythe School D i s tr i ct , i t s Speci al Ser vi ces D i r ect orr eques t ed a medi at i on confe r ence . T he par ent s decl i ned t o m edi at e and f i l ed a pe t i t i on fordue pr oces s w i th the N ew J er s ey O ffi ce of Speci al E ducat i on. T he mat t erw as as s i gned t o the H onor abl e J ohn R . Fut ey (A L J). O n D ece m ber6, 2000, the A L J found thatD ept for d “fa i l ed t o pr ovi de H . B . w i th a m eani ngful educa t i on” and or der ed i tt o cr eat e “a ful l dayi n- di s tr i ctpr ogr am i n a r egul ar e d u c a tio n c las s” tailo re d to H .B .’s n e e d s a n d to c o m p e n sa te th e f a m ilyf o r th e ir c o sts in e d u c a t i n g H. B. i n th e i n t e r i m. T h e S ch o o l D istri ct ap p ea led th e A L J’s d ec isi o n to the U n it ed S tat es D istri ct C o u rt forthe D i s tr i ctof N ew J er s eyon February15, 2001. O verthr ee mont hs l at er , the School D i s tr i ctr eques t ed a s t ayof enf or cementof the A L J ’ s deci s i on, w hi ch the C our tdeni ed on N o v e m b e r 2 , 2 0 0 1 . T h e re a f ter , the S c h o o l D istric t m o v e d f o r su m m a ryju d g m e n t, a rg u in g th a t th e A L J e rre d in f in d in g th a t itf

a iled to p ro v id e H .B . w ith a “ f re e a p p ro p ria te p u b lic e d u c a tio n ” (F A P E ), 2 0 U .S .C . § 1 4 1 2 (a )(1 ), in th e “ lea st re stric tiv e e n v iro n m e n t” (L R E ), id . at § 1 4 1 2 (a)(5).4

B yo rde r da ted F eb rua ry1 5 , 2 0 0 2 , the D istri ct C o u rtrev erse d the A L J’s d e ter m in a tio n th a t D e p tf o rd f a iled to p ro v id e a F A P E to H .B ., b u t ag re e d th a t itf a iled to do s o i n the l eas tr es tr i ct i ve envi r onm ent . B eca us e no harm r es ul t ed fr om the l ack of t he L R E , how ever , the D i s tr i ctC our tgr ant ed no r el i ef. T he D i s tr i ctC our tr equi r ed A ppel l ees “t o r eturn the port i on of the pr evi ous i nt er i m paym entw hi ch had notbeen a c tu a llysp e n t in re lian c e o n th e A L J’s e rro n e o u s d e c isio n ,” b u t p e rm itt e d th e m “ to re tain f u n d s s p e n t in g o o d f

a ith re lian c e u p o n th e A L J’s d e ter m in a tio n ” p rio r to its re v e rsa l. B as ed s ol el yon the fa ctthatA ppel l ees “w er e al l ow ed t o obt ai n and r et ai n” c o m p e n s a tio n f

o r i n te ri m s e rv ic e s “ to w h ic h D e p tf o rd h a d c h a lle n g e d th e ire n title m e n t,” the D i s tr i ctC our tent er ed an or deron M ar ch 31, 2006, deemi ng A ppel l ees the “pr evai l i ng party ” forpurpos es of 20 U . S. C . § 1415( i ) ( 3) ( B ) ( i ) ( I ) and s ubs equent l yaw ar ded them $9 8, 55 0 in at t orney s’ fees. II. W e begi n bynot i ng thatthe School D i s tr i ct ’ s pr i nci pal ar gum enti s thatA ppel l ees w e re n o t en tit led to a tto rn e y s’ f e e s b e c a u se th e yd id n o t p re v a il. F o r re a so n s u n k n o w n to th e C o u rt, A p p e llee s f

a il t o a d d re ss th is a rg u m e n t in th e ir b rie f. In ste a d , A p p e llee s re ly excl us i vel yon t hei rar gum entthatthe School D i s tr i ctcannotchal l enge the or derof M ar ch 31, 2006, i n w hi ch the D i s tr i ctC our tdet erm i ned thatA ppel l ees w er e the “p rev ail ing p arty , ” b ec au se D ep tfo rd’s N o ti ce o f A p p ea l ci tes o n lythe D istri ct C o u rt ’s5

D ecem ber 22, 2006 order quan t i fy i ng at t orney s’ fees at$9 8, 55 0. T his argum ent betray s a fun dam ental m i sund ers t and i ng of o ur precedents . A n a w a rd o f

a tto rn e y s’ f

e e s is n o t a f

in a l, ap p e a lab le o rd e r u n til th e a w a rd is q u a n tif ie d . Fr angos v. D oer i ng E qui p. C or p. , 8 6 0 F . 2 d 7 0 , 7 2 (3d C ir . 1 9 8 8 ); P e n n sy lva n ia v . Fla h e rty , 983 F. 2d 1267, 1276 ( 3d C i r . 1993) . U nderthe mer ger d o ctri n e, an ap p ea l of

a f inal aw ard o f a tt o rne y s’ fe es in clud es a p p ea l of all interl o cu tory o rd e rs re le v a n t th e re to . See I n r e D i et D r ug P r ods . Li ab. Li t ig. , 418 F. 3d 372, 377 ( 3d C ir . 2 0 0 5 ). I n the pr es entappea l , the C our t ’ s i nt er l ocut oryor der , w hi ch des i gnat ed the A ppel l ees as the “pr evai l i ng party , ” w as di r ect l yr el evantt o the C our t ’ s fi nal or der , w hi ch a w a rd e d f

e e s in th e a m o u n t o f

$ 9 8 ,5 0 0 . See 2 0 U .S .C . § 1 4 1 5 (i )( 3 )( B )( i) (I ). C o n seq u en tl y , the M arc h 3 1 o rde r m erg es in to the D ec em b er 2 2 o rde r, an d b o th are befo re us. G e n e ra lly, w e re v ie w th e g ra n t o f a tto rn e y s ’ f

e e s f o r a n a b u s e o f

d is c re tio n . See P . N . v. C l em enton B d. of

E duc. , 4 4 2 F .3 d 8 4 8 , 8 5 2 (3 d C ir. 2 0 0 6 ). A c c o rd in g ly , w e w ill r ever s e the aw ar d i f i t“r es t s upon a cl ear l yerr oneous fi ndi ng of fa ct , an err antconcl us i on of l aw oran i m pr operappl i cat i on of l aw t o fac t . ” Id . ( quot i ng H a n o v e rP o ta to P r o d

s ., In c . v. Sh a la la , 9 8 9 F . 2 d 1 2 3 , 1 2 7 (3d C ir . 1 9 9 3 )).6 III . T urni ng t o t he mer i t s , w e fi r s tnot e thatther e ca n be no doubtthatA ppel l ees achi eved vi ct oryi n t he admi ni s tr at i ve pr ocee di ngs . T he A L J rul ed thatthe School D istric t “f

a iled to p ro v id e H .B . w ith a m e a n in g f u l ed u c a tio n ” a n d o rd e re d D e p tf o rd to cre ate “ a f

u ll d ayin-d istri ct pro g ram in a re g u lar ed u ca ti o n class” tai lored to H . B . ’s n e e d s. In a d d iti o n , the A L J o rd e re d D e p tf o rd to c o m p e n sa te H .B .’s p a re n ts f o r th e ir c o sts i n e d u c a t i n g H. B. i n th e i n t e r i m. A ft erA ppel l ees ’ favor abl e dec i s i on atthe admi ni s tr at i ve pr ocee di ng, the School D istri ct ap p ea led, as w as it s ri g h t, to f ed era l cou rt . T h e D istri ct C o u rtrev erse d the A L J’s deci s i on, s t at i ng: [ T ]h e o n lyre lief

o b tain e d b y[ A p p e llee s] w a s to e n f o rc e c o m p lian c e w ith th e A L J’s d e c isio n p rio r to th e tim e it w a s p a rtiallyre v e rse d b yth is C o u rt, and [A ppel l ees ] achi eved no r el i ef upon the as pectof the A L J ’ s rul i ng that w as affi rm ed (nam el y , fai l ure t o p rovi de the L R E ) because [A pp el l ees] c o u ld d e m o n stra te n o h a rm . T h e [ A p p e llee s] a c h iev e d th is C o u rt’s in ter im a w a rd o f $ 8 8 ,0 9 0 .6 1 , co n sis ten t w ith th e A L J’s d e ter m in a tio n a n d b e f o re its re v e rs a l, b e c a u s e D e p tf o rd h a d n o t tim e ly so u g h t a s ta yo f s a m e , butnot beca use [

App el l ees] provedenti t l em ent upon this record . W hen i tturned outthatthe A L J ’ s aw ar d w as r ever s ed i n r el evantpart , and thatno r emedy w as due forfai l ur e t o pr ovi de the educ at i on i n the l eas tr es tr i ct i ve envi r onm ent , the C our tbas i cal l yor der ed [A ppel l ees ] t o r eturn the port i on o f th e p re v io u s in ter im p a ym e n t w h ich h a d n o t b e e n a c tu a llysp e n t in reli an ce o n the A L J’s erro n eo u s d ec isi o n . [A p p ell ee s] w ere , h o w ev er, all o w ed to retain f

u n d s sp en t i n g o o d fa ith reli an ce u p o n the A L J’s d e ter m in a tio n p rio r to th is C o u rt’s v a rio u s ru lin g s, a n d to th is e x ten t, [A ppel l ees ] “pr evai l ed, ” thati s , theyw er e al l ow ed t o obt ai n and r et ai n at lea st a p a rt o f

th e f u n d s a n d b e n e f

its to w h ich D e p tf

o rd h a d c h a llen g e d th e ir e n title m e n t. ( E m p h a s is a d d e d .)W e have hel d t hatthe t eac hi ngs of B uckhannon ar e di r ect l yappl i cabl e t o the 1 I D E A att orney s ’ fee s pr ovi s i on. J o h n T . ex re l. P a u l T

. v. D e la w a re C o u n ty I

n ter m e d ia te U n it , 3 1 8 F .3 d 5 4 5 , 5 5 6 (3 d C ir . 2 0 0 3 ). 7 W e fi nd no abus e of di s cr et i on i n the D i s tr i ctC our t ’ s fac tual fi ndi ngs , and w e ac cept th e m i n t ot o. See F ED . R. C IV . P. 52( a) ( 6) . T her efor e, w e nextcons i derw hetherthe D i s tr i c tC o u r tc o m m i t t e d l e g a l e r r o ri n h o l d i n g th a tA p p e l l e e s w e r e th e “ p r e v a i l i n g p a r ty” un der § 14 15 (i )( 3)( B )( i )( I) of the ID E A , w hich provides: A w a rd o f

a tto rn e y s’ f

e e s . . . In a n ya c tio n o r p ro c e e d in g b ro u g h t u n d e r th is s ect i on, the court , i n i t s di s cr et i on, m ayaw ar d r eas onabl e att orney s ’ fee s as partof the cos t s . . . t o a pr evai l i ng partyw ho i s the par entof a c hi l d w i th a d i s a b i l i ty. In a se m in a l d e c isio n re g a rd in g a tto rn e y s’ f e e s, th e S u p re m e C o u rt h e ld th a t a p a rt yis n o t a “ p re v a ilin g p a rt y ” u n le s s it “ p re v a ile d o n th e m e ri ts o f a t le a s t s o m e . . . cl ai m s , ” orr ece i ved “a tl eas ts om e r el i ef on the mer i t s . ” B uckhannon Bd. & Care H om e, Inc. v. W est V i rgi nia D ept. of H

ealth & H

um an R es. , 532 U . S. 598, 603 ( 2001) ( i nt ernal q u o tat ion an d cit ati o n o m itted). P u relytech n ical or d e m in im is su c c e ss is in su f f icie n t. 1 T ex a s S ta te T

e a c h e rs A ss ’n v . G a rla n d In d e p . Sc h . D ist. , 4 8 9 U .S . 7 8 2 , 7 9 2 (1 9 8 9 ). Li k e wi s e , p r e l i mi n a r yo ri n t e r i m s u c c e s s u n a c c o mp a n i e d b yu l t i ma t e s u c c e s s o f s o me k in d is g e n e ra lly in s u f

f ic ie n t. See Peopl e Agai ns tP ol i ce Vi ol ence v. C i t y of P i t t s bur gh , 520 F. 3d 226, 234 ( 3d C i r . 2008) ( i ndi cat i ng thatw her e i ni t i al r el i ef pr oves fl eet i ng, a tto rn e y s ’ f

e e s a re in a p p ro p ri a te ).F i nall y , w e no t e t hat even if the D i stri ctC ou rt ’s fi nd i ng w i th respectt o the l east 2 r es tr i ct i ve envi r onm enti s s ue r ender ed A ppel l ees the “pr evai l i ng party , ” an a w ar d of a tto rn e y s ’ f

e e s w o u ld n o t b e p ro p e r o n th e p a rt ic u la r f a c ts o f th is c a s e . See Farr arv. H obby , 506 U . S. 103, 105, 115 ( 1992) . A s the D i s tr i ctC our tnot ed, the r el i ef a chi eved h e re w a s “ s c a n t a n d u n im p re s s iv e ,” a n d A p p e lle e s a c h ie v e d n o re lie f o n th e L R E is s u e . 8 I ndeed, l as tT erm the Supr eme C our thel d that“[p] r evai l i ng partys t atus . . . does notatt end ac hi evementof a pr el i m i naryi nj unct i on thati s r ever s ed, di s s ol ved, or otherw i s e undone bythe fi nal deci s i on i n the s ame cas e. ” Sol e v. W yner , 127 S. C t . 2188, 2195 ( 2007) . I n a s i m i l arvei n, w e have obs erved that“w hen a ju d g m e n t i n favorof a [party ] i s r ever s ed on the mer i t s , thatpartyi s no l ongera ‘ pr evai l i ng party ’ . . . and no lo n g e r e n title d to a tto rn e y ’s f e e s .” C la rk

v . T w p . o f Fa lls , 8 9 0 F . 2 d 6 2 5 , 6 2 6 (3d C ir . 1 9 8 9 ) (em p h asis ad d ed ). A ppl y i ng thes e pr i nci pl es t o the i ns t antappea l , w e di s agr ee w i th the D i s tr i ct C our t ’ s concl us i on thatA ppel l ees achi eved pr evai l i ng partys t atus under § 1415( i ) ( 3) ( B ) ( i ) ( I ) of the I D E A beca us e theyw er e notr equi r ed t o r eturn thatpor t i on of the A L J ’ s i nt er i m aw ar d w hi ch theyhad al r eadys pent . T he fa ctthatA ppel l ees achi eved onl yt empora r yr el i ef r equi r es j udgm enti n favorof the School D i s tr i ctbeca us e s uch r el i ef is n o t e q u iv a le n t to f

in a l r e lie f

o n th e m e ri ts . Se e J

oh n T. , 3 1 8 F .3 d a t 5 5 6 , 5 5 9 ; J. O . v. O r ange Tw

p. B d. of E duc. , 2 8 7 F . 3 d 2 6 7 , 2 7 4 (3d C ir . 2 0 0 2 ). A s n o ted, th e D istri ct C o u rt expr es s l yconcl uded thatA ppel l ees fai l ed t o pr ove thei rent i t l ementt o r el i ef on the m er i t s . W i thouts uch a vi ct ory , A ppel l ees cannotbe cons i der ed the “pr evai l i ng party . ” See Buckhannon , 5 3 2 U .S . at 6 0 3 ; So le , 127 S. C t . at2196. 2M o re o v e r, A p p e llee s’ a tto rn e y– e ith e r th ro u g h g ro ss c a re les sn e ss o r w o rse – in iti a lly

s o u g h t f e e s th a t in c lu d e d 6 0 h o u rs b ille d in a s in g le d a y . See Fai rH ous i ng C ounci lof G r eat erW

as h. v. Landow , 999 F. 2d 92, 96 ( 4th C i r . 1993) . O n thi s r ecor d, w e fi nd that fee s s houl d nothave be en aw ar ded. 9 Forthe for egoi ng r eas ons , w e w i l l r ever s e the or derof the D i s tr i ctC our taw ar di ng fee s and r emand forj udgm entt o be ent er ed i n favorof D ept for d T ow ns hi p School D istric t.