Opinion ID: 176944
Heading Depth: 1
Heading Rank: 3

Heading: The district court erred by holding NMPED liable for Tularosa's failure to provide M.C. a FAPE.

Text: The parties next join issue over whether NMPED breached a duty to provide a FAPE to M.C. by directly providing him educational services. In evaluating a claim of liability under the IDEA, this circuit undertakes a two-step review: (1) Has the school district complied with the procedures set forth in IDEA? (2) Are the special education services provided to the student reasonably calculated to enable the child to receive educational benefits-or in other words, has the school district fulfilled its obligation to provide the student with a FAPE? Garcia v. Board of Educ. of Albuquerque Pub. Sch., 520 F.3d 1116, 1125 (10th Cir.2008) (citing Bd. of Educ. v. Rowley, 458 U.S. 176, 206-07, 102 S.Ct. 3034, 73 L.Ed.2d 690 (1982)); Ellenberg v. N.M. Military Inst., 478 F.3d 1262, 1274-75 (10th Cir.2007). We first explain why we must decide this issue given that, ultimately, the district court awarded no relief. See 614 F.Supp.2d at 1214-17. The district court awarded no remedy, despite its holding that NMPED violated the IDEA, because the parents asked for duplicative compensatory damages, had insufficient evidence of their out-of-pocket expenditures for M.C.'s homeschooling to support any possible award of reimbursement and because their requested hotline would have no impact on the educational services provided to M.C. 614 F.Supp.2d at 1216-17. We note that the district court explicitly did not consider whether NMPED failed to provide an adequate continuum of alternative placements for M.C. and therefore did not award any relief based on that theory. 614 F.Supp. at 1213-14. It held that to address the issue, or to address whether NMPED had adequate monitoring processes, would require taking on the task of forcing systematic changes to the way in which the NMPED operates. Id. at 1214. Moreover, the court noted that the parents did not forcefully advance the issue but, instead, suggested that the court could, but need not, find NMPED failed... to ensure a continuum of alternative placement to [M.C.]. Id. The district court therefore decided to limit its decision to claims upon which its jurisdiction was based; that is, whether NMPED failed in its duties to M.C. See id. Likewise, we agree that, assuming we agreed with its holding that the NMPED violated the IDEA, the district court did not abuse its discretion in declining to find that the NMPED failed to provide a continuum of services or failed in its monitoring obligations. The district court also declined to award any other remedy for NMPED's violations of the IDEA. A district court has wide discretion to fashion relief in IDEA cases, 20 U.S.C. § 1415(i)(2)(C)(iii) (2000), and it exercised it in the present case to decline to award the equitable relief of ordering a hotline installed. We review equitable IDEA awards for abuse of discretion. Garcia, 520 F.3d at 1128-29. We agree with this decision because it would have had no effect on M.C.'s education. The problem in this case was not, as the district court noted, that M.C.'s concerns were unknown to NMPED but, rather, that, even after a phone call from the parents, NMPED failed to act. 614 F.Supp.2d at 1216-17. As to the request for reimbursement for M.C.'s mother's expenses while homeschooling M.C., the district court decided that there was insufficient evidence of those expenses and therefore declined to award relief even if, having found a violation of the IDEA, those expenses could have been reimbursed on the basis of more evidence. 614 F.Supp.2d at 1216 (While [Ms. Nelson] may have provided educational servicesand the record does not adequately catalogue the extent or value of these servicesshe does not show that she paid out-of-pocket expenses.). The district court exercised its discretion to refuse to award relief because it found there was insufficient evidence. Since, however, the parents sought declaratory relief under the IDEA against NMPED and urged the court to hold that NMPED is responsible for a deprivation of a FAPE, we must decide that fundamental issue, which precedes the question of relief. 1st Am. Compl. ¶ VII.3. The Supreme Court was equally divided over the issue whether a court may order a state to provide services directly to a child if the LEA fails to do so. Honig, 484 U.S. at 329, 108 S.Ct. 592. Therefore, since this is a matter of first impression in this circuit, we proceed by construing the statute that addresses whether an SEA must directly provide a student a FAPE when the LEA is not providing one. We begin, as we must, with the statutory language: (h) Direct services by State educational agency (1) In general. A State educational agency shall use the payments that would otherwise have been available to a local educational agency or to a State agency to provide special education and related services directly to children with disabilities residing in the area served by that local agency, or for whom that State agency is responsible, if the State educational agency determines that the local education agency or State agency, as the case may be (A) has not provided the information needed to establish the eligibility of such agency under this section; (B) is unable to establish and maintain programs of free appropriate public education that meet the requirements of subsection (a) of this section; (C) is unable or unwilling to be consolidated with one or more local educational agencies in order to establish and maintain such programs; or (D) has one or more children with disabilities who can best be served by a regional or State program or service-delivery system designed to meet the needs of such children. (2) Manner and location of education and services. The State educational agency may provide special education and related services under paragraph (1) in such manner and at such locations (including regional or State centers) as the State agency considers appropriate. Such education and services shall be provided in accordance with this subchapter. 1413(h) (2000) (emphasis added); see also 34 C.F.R. § 300.360 (2002). The district court thoroughly examined the meaning of the ambiguous word determine to conclude that the SEA need make no formal decision or finding that the LEA was not complying with the statute but, rather that the word determine was best read to mean finding out. This definition could comfortably apply to each of the four situations listed under § 1413(h)(1) and, the district court reasoned, a word used in a statutory enactment should have the same meaning for each use. 614 F.Supp.2d at 1208-09. Although this reasoning is plausible, for present purposes, we shall assume without deciding that determining means finding out. The district court ultimately concluded that NMPED had plenty of time to provide direct services in the period between the inception of the dispute between the parents and Tularosa in the fall of 2003 and the start of administrative proceedings in May 2004, but, instead, it actively supported Tularosa's position that it had no obligation to cross the threshold of the parents' home. 614 F.Supp.2d at 1211-13. The district court, relying on Doe v. Maher, 793 F.2d 1470, 1491 (9th Cir.1986), aff'd by an equally divided court sub nom. Honig v. Doe, 484 U.S. 305, 108 S.Ct. 592, 98 L.Ed.2d 686 (1988), as persuasive authority and the language, structure and history of the IDEA, explained that, although Tularosa was not unable to meet M.C.'s needs (upholding the factual determination of the AAO), it was unwilling, (although this finding was not explicitly tied to facts beyond the obvious fact that Tularosa did not help the parents to get M.C. out of their home, citing Maher ) and, therefore, NMPED should have directly provided a FAPE. 614 F.Supp.2d at 1211; Maher, 793 F.2d at 1492 (It would seem incontrovertable [sic] that, whenever the local agency refuses or wrongfully neglects to provide a handicapped child with a free appropriate education, that child `can best be served' on the regional or state level.'). Maher held that an SEA was required to intervene directly if the LEA is failing to do so, the SEA had notice of noncompliance and the SEA had a reasonable opportunity to compel compliance before an order was imposed against it. Maher, 793 F.2d at 1492. Maher did not specify the form of this notice. Maher relied on the predecessor provision to 1413(h)(1)(D) that, as it does now, requires the state to step in if the LEA has 1 or more children with disabilities who can best be served by a regional or State program or service delivery system designed to meet the needs of such children. Applying Maher, the district court held that NMPED was afforded a reasonable opportunity to compel local compliance because of the length of the administrative proceeding and, under (D), the state was required to provide direct education at either a regional or state level. 614 F.Supp.2d at 1213. The statute, however, does not apply to the present facts. Situations (A) and (C) are clearly not applicable and, NMPED did not either formally determine or f[ind] out that (B) a regional or state delivery system was necessary or (D) one or more students could best be served by a state or regional program. As the district court concluded, after reviewing the administrative officers' factual findings and receiving further testimony at an evidentiary hearing, Tularosa could, with professional help, implement the AAO's order and provide a FAPE to M.C. 614 F.Supp.2d at 1210-11. Cf. Garcia, 520 F.3d at 1125 (the factual findings in an IDEA administrative record are considered prima facie correct) (internal citations omitted). Instead, the AAO held that Tularosa had failed to provide M.C. a FAPE but that Tularosa would be able to directly provide education to M.C. with some extra assistance. In addition, at no point did NMPED find out that M.C. could best be served by a regional or State program or service-delivery system designed to meet the needs of such children. In reaching its result, the district court merely assumed that, applying Maher, whenever the local agency refuses or wrongfully neglects to provide a handicapped child with a free appropriate education, that child `can best be served' on the regional or state level. 793 F.2d at 1492. [6] There was, however, no finding that M.C. could be best served by state or regional programs. Cf. § 1413(h). In this vein, we note with approval the actual injunction entered by the district court in Maher that permanently enjoined the SEA to directly provide services when for example, the [LEA] fails either to develop or implement an IEP determination, and also fails properly to appeal such determination to the [SEA]. 793 F.2d at 1502 (including the district-court opinion in an appendix). Thus, even the injunction approved by the Ninth Circuit suggests some recourse to the administrative process before the SEA is required to provide direct educational services. Certainly, LEAs are not infallible and may play a role in mistakenly crafting IEPsthe larger failure is, however, if the administrative process breaks down and the student languishes without any hope that a process set in motion by either the parents or some other party may lead to a solution. In the present case, as soon as the parents were ready to formally object to M.C.'s IEP, the administrative procedure began and the parents kept their son home-schooled without seeking an injunction or other remedy to have him placed elsewhere during that time. Cf. Maher, 793 F.2d at 1477 (describing that the district court granted a temporary restraining order and then a preliminary injunction enjoining the LEA from excluding the student from school, within days of the expulsion, while efforts were made to find him an alternative placement). And, as we have noted, for these procedures to work, they must be given time: the IDEA does not provide immediate relief: Potentially, relief is available to the plaintiffs under the IDEA. Relief is available whenever the plaintiff could attain relief for the events, condition, or consequences of which the person complains, not necessarily relief of the kind the person prefers. ... The dispositive question generally is whether the plaintiff has alleged injuries that could be redressed to any degree by the IDEA's administrative procedures and remedies. ... We do not determine the availability of the relief based on the immediate ability of a plaintiff to attain it, recognizing that a child may have to go through several procedural steps to take advantage of that remedy. Ellenberg, 478 F.3d at 1276 (internal citations omitted). The parties argue that the larger context of the statute supports their interpretation of 1413(h). The parents contend that IDEA provisions should be construed in light of the overarching Congressional concern that individual students may be neglected because of regulatory spaces between the jurisdictions of multiple agencies with responsibility for disabled children's education. While we agree that it is apparent that the IDEA centralizes responsibility for assuring that the requirements of the Act are met in the SEA, this is not the end of the story. 20 U.S.C. § 1412(11) (2000) (The [SEA] is responsible for ensuring that ... all educational programs for children with disabilities in the State, including all such programs administered by any other State or local agency ... meet the educational standards of the [SEA].); see S.Rep. No. 168, 94th Cong., 1st Sess. 24 (1975) reprinted in (1975) U.S.C.C.A.N. 1425, 1448 (The committee bill requires that the [SEA] be responsible for insuring that all requirements of the Act are carried out, that all education programs for handicapped children within the State, including all such programs administered by any other State or local agency, must meet State educational agency standards and be under the general supervision of persons responsible for education of handicapped children.). As noted, the IDEA is primarily a funding statute and the SEA controls some of the purse strings. Should the SEA decide that an LEA is not deserving of funding because it is failing its students with disabilities, the SEA may not, in furtherance of its ultimate responsibility for the education of children in the state, simply yank funding from an LEA without further ado. Cf. § 1413(h) (A[n] [SEA] shall use the payments that would otherwise have been available to a[n] [LEA] ... if the [SEA] determines ...). Instead, the SEA is required first to provide notice and a hearing to the LEA before it determines that it is failing to comply with a requirement of the Act. 20 U.S.C. § 1413(d)(1) (providing for notice and a hearing); § 1413(a)(3) (the LEA shall ensure that its personnel are appropriately and adequately prepared); cf. § 1232c(b)(2) (providing for notice and time for the LEA to show cause why the funding should not be suspended for failure to substantially comply with several IDEA requirements); 20 U.S.C. § 1412(a)(13)(The [SEA] will not make a final determination that a[n LEA] is not eligible for assistance under this subchapter without first affording that agency reasonable notice and an opportunity for a hearing). As we noted above in the section considering whether NMPED should have been included in the administrative proceedings, revisions to the educational services provided a student with disabilities are addressed through modifications of a child's IEP, made by reconvening the IEP team. That is, the SEA cannot unilaterally change the IEP. 20 U.S.C. § 1414(d)(5) (2000) (If a participating agency, other than the local educational agency, fails to provide the transition services described in the IEP in accordance with paragraph (1)(A)(vii), the local educational agency shall reconvene the IEP Team to identify alternative strategies to meet the transition objectives for the child set out in that program.); see also NMAC 6.31.2.11(B)(2). The SEA can, however, as the parents point out, order the IEP team to meet to develop a plan to provide a FAPE. Given the central focus of the IDEA on the IEP and on the procedural mechanisms for addressing grievances through the IEP team and due process proceedings, it seems inconsistent with the statutory structure to allow the state to run roughshod over these procedures simply because parents contend that an IEP is not providing their child a FAPE. We recognize, however, that the district court here was strongly influenced by the impasse resulting from the child's refusal to leave his house and the school district's refusal to extract him, a situation that blocked educational progress for perhaps an unconscionable time. We note also that our conclusion denying inculpation of the state is in some tension with holdings affirmed by the Third, Ninth, and Eleventh Circuits although, ultimately, we find them distinguishable. In Georgia Association of Retarded Citizens v. McDaniel, the Eleventh Circuit eventually affirmed as modified a district court decision in which the court explained that § 1414(d) of the Educational for all Handicapped Children Act (EHA) (predecessor to the IDEA's § 1413(h)) requires the state to directly provide education in certain circumstances, but the district court rested its conclusion that the SEA violated the IDEA on the SEA's de facto policy restricting LEAs from providing more than 180 days of schoolinga conclusion not based directly on the determines language of the EHA. See 511 F.Supp. 1263, 1278-79 (N.D.Ga.1981), aff'd as modified by 740 F.2d 902, 903 (11th Cir. 1984). Likewise, the Third Circuit stated the general proposition that an SEA may be required to provide direct services, but noted that the district court did not hold that the SEA was directly responsible for providing a child educational services, only that it was required to make sure that plans for providing a FAPE to all children with disabilities in the state were implemented. Kruelle v. New Castle County Sch. Dist., 642 F.2d 687, 696-97 (3d Cir. 1981) (applying § 1412 (which is not the predecessor to § 1413(h)), which, at the time, provided that the SEA shall ensure that the requirements of this subchapter are carried out and all programs administered by other state agencies or an LEA will be under the general supervision of the persons responsible for educational programs for handicapped children in the [SEA]); cf. S-1 v. Turlington, 635 F.2d 342, 350 (5th Cir. Unit B Jan.1981) (holding that the state had the right to intervene in local disciplinary proceedings involving a child with disabilities because of its general responsibilities for education in the state, construing the predecessor to § 1412(11), cited above), overruled on other grounds by Honig v. Doe, 484 U.S. at 317, 108 S.Ct. 592. We take no position on the Ninth Circuit's holding in Maher, but even if we adopted it, we would not find that holding to be applicable here because the case is factually distinguishable. The only notice the SEA had in the present case was an informal letter, advising the state that the parents were keeping their dispute at the local level and a brief phone call about complying with the due process hearing procedures to challenge Tularosa's IEP. We believe that the SEA was not on notice of non-compliance such that it should have attempted to take over education for the LEA without allowing the structured evidentiary hearings provided by the Act to run their course. M.C.'s situation seemed to strongly indicate that he was not receiving a FAPE based on the fact that he was not in school and, significantly, had been dropped from the rolls. That said, however, given the administrative protections built into the IDEA for both the parents and the LEAs and SEAs, notice derives from something more than what occurred hereinitial bits of information provided well before recourse to the administrative process. Moreover, Maher presented more extreme facts. For example, the local school summarily expelled the student and the local agency involved in the Maher case refused to convene an IEP meeting until it was ordered to do so by the district court. While we here hold that NMPED was not required by the IDEA to provide educational services directly to M.C., we cite with approval cases from other circuits holding that the state may still be financially responsible for an LEA's failure to provide a disabled child a FAPE. See, e.g., St. Tammany Parish Sch. Bd., 142 F.3d at 783-85 (reviewing the district court's interim award for an abuse of discretion); Gadsby, 109 F.3d at 955-56 (remanding to allow the district court to fashion an award and holding that the SEA may be liable for reimbursement costs). At oral argument, one of our panel members noted that it is often an unsatisfactory victory when a court holds that the subsidiary is liable but simultaneously concludes that the deep-pocketed parent corporation is not. In the case of the IDEA it seems well-established that the parent corporation, the SEA, is indeed potentially financially responsible for an LEA's failure to comply with its responsibilities, within the broad discretion of a district court. The SEA is, however, not required to take over education directly. In the present case, NMPED did reimburse Tularosa for some of its M.C.-related compensatory education costs (recall that NMPED reimbursed $146,000 of the $165,000 it cost to educate M.C. while implementing the AAO's order). And, because we approve of the district court's decision not to award any reimbursement for Ms. Nelson's costs of educating M.C. because she did not provide supporting evidence and its discretionary decision not to award any other remedy, we need not remand for the district court to determine whether to require NMPED to reimburse Tularosa for her costs. [7] This is a most unusual case because M.C. was home-schooled for a significant period of time because of behaviors stemming from his autism and dropped from the school rolls. The district court noted that allowing months and years to pass before NMPED intervenes is contrary to the main purposes of the IDEA, which was designed to make sure that all children with disabilities were provided free education in the public schools. We certainly agree that there might be a different case where the administrative procedure extends, without interference by the parents, until it becomes apparent that the child is languishing due to unnecessary and excessive delay, so that the state must act, especially when faced with a straightforward parental demand for SEA intervention combined with an obvious failure of the system. This is not quite that case. [8] And, in a different case where the parents were more confident that, from the outset, their child was deprived completely of a FAPE, they might have been able to file a federal court action for an injunction much earlier, noting the clear, imminent harm if a child is not provided any education by his LEA during the administrative process. This is a difficult and frustrating case, where we have sought to balance useful procedural requirements with the need for expedition. We do not, however, intend to signal state agencies that they may routinely rely on procedural requirements to insulate them from all liability, where the statutory remedies have run off the rails.