Court Opinion

ID: 9788286
Source: CourtListenerOpinion
Date Created: 2023-08-31 00:36:55.167703+00
Date Added: 2024-06-11T07:37:07.300571
License: Public Domain

ORDER DENYING PLAINTIFFS’ EMERGENCY MOTION FOR REHEARING
This cause is before the Court upon Plaintiffs’ Emergency Motion for Rehearing of Order Denying Motion for Preliminary Injunction. (Docket # 14) Although the Court finds that the Emergency Motion raises no new issues for review and that Plaintiffs’ emergency contentions were fully considered by this Court prior to issuing its Order, it will clarify its findings. However, this Court denies Plaintiffs’ motion.
A. Defendants failed to prove Plaintiffs fraudulently concealed income.
Plaintiffs contend that in order to establish a substantial likelihood of success on the merits, they need only show that it is likely that Defendants have not met their burden of proof in establishing that one of the specified grounds for disqualification of Section 8 Certification, pursuant to 24 C.F.R. § 882.210(d), exist. Consequently, once Plaintiffs raise the issue of an improper disqualification, they argue that the burden shifts to Defendants to prove they committed a fraud and that it is not necessary for them to prove they did not commit the fraud at the administrative hearings.
Plaintiffs further contend that Defendants specifically disavowed any basis other than fraud for terminating Section 8 Certification pursuant to 24 C.F.R. § 882.-210(d). Therefore, that the Court incorrectly relied upon 24 C.F.R. § 882.210(d)(2) “Family Obligations” as the basis for finding that Plaintiffs have not established the substantial likelihood of success on the merits.
*936Also, Plaintiffs contend that Mrs. Bas-ham’s un-rebutted sworn statements are entitled to credibility because the Court did not take any live testimony at the September 9 hearing. Mrs. Basham stated that it was she who voluntarily delivered the letter to Defendants which revealed Plaintiffs’ April and May 1992 income. Accordingly, Plaintiffs contend that Defendants relied upon this information as the only income upon which to base their fraud determination. Consequently, that Defendants based their determination of fraud solely upon Mrs. Basham’s letter.
Further, Plaintiffs contend that Defendants erroneously based their fraud determination on County’s own 14-day reporting requirement. However, Plaintiffs contend that the failure to report income within 14 days does not equal fraud. Plaintiffs assert that this omission may have been negligent or even grossly negligent, but it certainly does not rise to the level of fraud. Plaintiffs assert that there is no authority for the proposition that failure to report income within 14 days constitutes fraud under either 42 U.S.C. § 1437f or 24 C.F.R. § 882.210(d).
Consequently, Plaintiffs contend that Defendants’ attempt to use an un-rebuttable presumption that a 14 day reporting omission constitutes fraud violates the substantive due process rights of Section 8 participants. Plaintiffs assert that this presumption violates substantive due process because it does not bear a reasonable relationship to the legislative objective at issue. Plaintiffs contend that the means lack a reasonable relationship to the legislative objective because it effects a deprivation of a federal entitlement for non-fraudulent and fraudulent conduct alike.
Plaintiffs’ contentions regard this Court’s finding that Plaintiffs failed to meet their burden of establishing a substantial likelihood of success upon the merits. This Court found that Plaintiffs could not establish this element because of the evidence indicating Plaintiffs’ fraud. Further, Plaintiffs’ contention that this Court based its determination solely upon Plaintiffs failure to report changes in income within 14 days and the Plaintiffs’ own voluntary disclosure of changes after this 14 day period expired is misplaced.
First, the Court finds that Defendants based their decision to terminate Plaintiffs’ Section 8 Certification on fraud pursuant to 24 C.F.R. § 882.210(d)(1). However, Defendants contend that Plaintiffs defrauded the Hillsborough County Housing and Community Development Department (the “Department”) by their failure to report changes in income pursuant to 24 C.F.R. § 882.118. Therefore, as this Court noted in its Order Denying Motion for Preliminary Injunction (Docket # 14), “the Department had two grounds for termination of public housing assistance benefits under 24 C.F.R. § 882.210(d).”
Further, Plaintiffs’ contention that Defendants disavowed all grounds for termination except fraud is misplaced. In Defendants’ Response to Plaintiffs’ Motion for a Preliminary Injunction (Docket # 12), Defendants simply assert that Plaintiffs’ Section 8 Certification was terminated for fraud and that Plaintiffs’ reliance on the “Family Obligations” was incorrect. Defendants’ contention does not preclude the Court from finding that the failure to report changes in income pursuant to these “Family Obligations” is a ground for termination of public housing benefits. However, this Court considered fraud as the grounds for termination in determining Plaintiffs could not prove a substantial likelihood of success on the merits.
Last, Plaintiffs’ contention that they were denied substantive due process is without merit. This contention is based upon the assertion that Plaintiffs’ Section 8 Certification was terminated solely for their failure to report changes in income within 14 days. This Court finds that it does not need to address whether this 14 day reporting period constitutes an unconstitutional presumption because Plaintiffs’ Section 8 Certification was not terminated solely upon their failure to report changes in income within this period.
This Court finds that Plaintiffs’ Section 8 Certification was terminated for their repeated failure to report income. Pursuant *937to Lynda Triplett’s sworn affidavit, the decision to terminate Plaintiffs’ certification was “because the file showed conclusively that Plaintiffs were aware of a duty to disclose income, had failed to disclose in the past, had been given a second chance, and again concealed income.” (Notice of Filing Materials in Opposition to Motion for Preliminary Injunction, Docket #8; Exhibit # 4) Accordingly, Plaintiffs’ contention that they were denied substantive due process due to the termination of their public housing benefits for the failure to report income within 14 days alone is misplaced.
B. Plaintiffs were denied the minimum guaranties of 24 C.F.R. § 882.216 and the 14th Amendment in upholding the Housing Counselor’s decision to terminate the Section 8 Certificate.
Plaintiffs also contend that the Court did not resolve the issue of compliance with 24 C.F.R. § 882.216(b)(6)(l), as to Defendant Freda having been the one who conducted the informal administrative hearings. Plaintiffs assert that contrary to this regulation, Freda was “a person who made or approved the decision under review.” Plaintiffs base this assertion upon Mrs. Basham’s affidavit which contains un-re-butted evidence that Don Shea is Freda’s assistant and that Shea had substantial involvement in the case and the decision.
Further, Plaintiffs contend that Defendants have offered no proof that Shea is not Freda’s assistant or denied Mrs. Bas-ham’s testimony as to Shea’s substantial, direct involvement in Plaintiffs’ case. This involvement included Shea coming into the County office on Saturday, May 23, 1992, and typing a memo to the file indicating an intent to minimize Plaintiffs’ entitlement to Section 8 benefits. Therefore, Plaintiffs contend that to find Freda was not “a person who made or approved the decision under review”, one must rely upon the inherently unbelievable evidentiary premise that an assistant does not report his daily activities to his supervisor for review and approval.
Consequently, although the Court discussed Defendants’ compliance with Goldberg v. Kelly, 397 U.S. 254, 90 S.Ct. 1011, 25 L.Ed.2d 287 (1970), Plaintiffs contend the Court did not specifically address this case’s requirement that the decision maker be impartial. Plaintiffs assert that the transcript of the first informal hearing reveals prejudicial and prosecutorial misconduct by Freda in conducting the hearing. They assert that during this hearing, Freda made several statements evidencing the fact that he was a partial hearing officer. Plaintiffs argue that these statements indicate Freda prejudged the merits, relied upon rumors and required Plaintiffs to disprove his pre-judged conclusion.
This Court found in its Order Denying Motion for Preliminary Injunction (Docket # 14) that Plaintiffs were not denied the minimum guaranties of 24 C.F.R. § 882.-266(b)(6)(i) or the 14th Amendment. Section 882.266(b)(6)(i) simply requires that the informal hearing be conducted by anyone other than a person who made or approved the decision under review. Plaintiffs contend that Freda cannot conduct the informal hearing because he supervises all the counselors and that his assistant, Don Shea was substantially and directly involved in the case.
However, both Freda’s and Triplett’s Affidavits state that the decision to terminate Plaintiffs’ Section 8 Certification was made solely by Ms. Triplett. (Notice of Filing Materials in Opposition to Motion for Preliminary Injunction, Docket # 8; Exhibits 1 and 4) Consequently, this Court found that neither Shea nor Freda had any involvement in the decision to terminate the public benefits. The sworn affidavits of both Freda and Triplett indicate that Triplett alone, made the decision to terminate Plaintiffs’ Section 8 Certification. Thus, Freda was an impartial hearing master because he was not “a person who made or approved the decision under review.”
Plaintiffs also contend that Freda approved the decision to terminate the Plaintiffs’ Section 8 Certification because Shea had substantial and direct involvement in the case. However, the fault with this contention is that Shea did not make the decision to terminate assistance; this deci*938sion was made solely by Triplett. Thus, it is impossible to infer that Freda approved the decision of his assistant to terminate the assistance because his assistant, Shea, did not make that decision. Therefore, Freda did not approve of the decision to terminate Plaintiffs’ Section 8 Certification until two impartial hearings were conducted.
Further, Plaintiffs were not denied an impartial hearing based upon statements made by Freda during the hearings. Plaintiffs rely upon the statement made by Freda that “Yeah, because there was some rumor about payments being made under the table.” (Notice of Filing Materials in Opposition to Motion For Preliminary Injunction, Docket # 8; Exhibit 4, Page 11-12) Plaintiffs assert that Freda pre-judged the merits based upon rumor and required Plaintiffs to disprove his conclusion.
However, this statement is clearly taken out of context. The transcript of the hearing also documents Freda’s subsequent statement that “Okay. Well, I have to review the File. And, in order to make a decision, I go by the facts in the File.” (Notice of Filing Materials in Opposition to Motion For Preliminary Injunction, Docket #8; Exhibit 4, Page 12) Consequently, the Plaintiffs’ focus on one statement in the transcript of the hearing does not indicate that Freda prejudged the merits of the case based upon rumor. A review of the transcript clearly indicates that Freda based his decision to approve Ms. Triplett’s decision to terminate assistance upon the facts of the case in the case file. Accordingly, Plaintiffs were afforded an impartial hearing officer.
Accordingly, it is
ORDERED Plaintiffs’ Emergency Motion for Rehearing of Order Denying Motion for Preliminary Injunction be denied.
DONE and ORDERED.