E.; et al. vs. McManaman
Filing
113
ORDER ADOPTING MAGISTRATE JUDGE'S FINDINGS AND RECOMMENDATION (ECF NO. 108 ), AS MODIFIED. Signed by JUDGE HELEN GILLMOR on 3/17/2016. Re: 78 (ecs, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
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Plaintiffs,
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vs.
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RACHEL WONG, in her official )
capacity as Director of the )
State of Hawaii, Department )
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of Human Services,
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Defendant.
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_________________________
J.E., THROUGH HIS PARENT
SUZANNE EGAN, for themselves
and on behalf of a class of
those similarly situated; and
the HAWAII DISABILITY RIGHTS
CENTER, in a representative
capacity on behalf of its
clients and all others
similarly situated,
CIV. NO. 14-00399 HG-BMK
ORDER ADOPTING MAGISTRATE JUDGE’S FINDINGS AND RECOMMENDATION
(ECF NO. 108), AS MODIFIED
Before the Court is Plaintiffs’ Motion for Class
Certification (Doc. 78).
on January 26, 2016.
The Magistrate Judge heard the Motion
After careful consideration of the
Motion, the supporting and opposing memoranda, and the
arguments of counsel, the Magistrate Judge recommended that the
Motion be DENIED.
The Court adopts the findings and
recommendation of the Magistrate Judge, as modified.
As discussed in more detail below, critical issues in
this case remain unclear:
whether Defendant Department of
Human Services (DHS) has a policy regarding applied behavioral
analysis (ABA) treatment, whether DHS used that policy to deny
ABA treatment or reimbursement for such treatment, and whether
Plaintiff J.E. or other proposed class members were denied
treatment.
These issues overlap with the certification
inquiry and are relevant to the Court’s analysis of class
certification.
Given these uncertainties, the Court finds
that Plaintiffs have not established that class certification
is appropriate at this time.
Class certification is denied as
premature.
FACTUAL BACKGROUND
Plaintiff J.E. is six years old, qualifies for
Medicaid, and has been diagnosed with autism.
Complaint (SAC) ¶¶ 66, 68.)
(Second Amended
Several professionals have
recommended ABA treatment for J.E.’s condition.
(Id. ¶ 69.)
Plaintiffs contend that this treatment is medically necessary
for J.E. to correct, maintain, or ameliorate the effects of his
disability.
(Id.)
Although J.E. may have initially been
informed by DHS that ABA treatment would not be covered,
2
Plaintiffs state that DHS eventually reimbursed his provider
for the treatment.
Plaintiff Hawaii Disability Rights Center
(HDRC) is a nonprofit corporation whose purpose is to protect
and advocate for the legal and civil rights of people with
disabilities.
(Id. ¶ 21.)
Plaintiffs J.E. and HDRC bring this lawsuit on behalf
of the following proposed class:
All former, current, and future
Medicaid-eligible persons in Hawai`i under
the age of twenty-one who have been diagnosed
with an Autism Spectrum Disorder (“autism”)
and prescribed or recommended applied
behavioral analysis (“ABA”) treatment to
ameliorate their condition.
(Motion at 1, SAC ¶¶ 76-77.)
Plaintiffs claim that DHS has a
blanket policy, whereby it does not provide Medicaid coverage
for ABA treatment regardless of medical necessity and, thus,
fails to comply with the Medicaid Act.
(SAC ¶ 1.)
DISCUSSION
Plaintiffs move for certification of its proposed
class.
A plaintiff moving to certify a class has the burden
of showing that the proposed class satisfies the requirements
of Federal Rules of Civil Procedure Rule 23.
See Wal–Mart
Stores, Inc. v. Dukes, 131 S.Ct. 2541, 2548 (2011).
3
Rule 23(a)
states four threshold requirements applicable to all class
actions:
(1) the class is so numerous that joinder of
all members is impracticable;
(2) there are questions of law or fact common
to the class;
(3) the claims or defenses of the
representative parties are typical of the
claims or defenses of the class; and
(4) the representative parties will fairly
and adequately protect the interests of
the class.
Fed. R. Civ. P. 23(a).
These requirements are known as
numerosity, commonality, typicality, and adequacy of
representation.
See United Steel, Paper & Forestry, Rubber,
Mfg. Energy, Allied Indus. & Serv. Workers Int’l Union v.
ConocoPhillips Co., 593 F.3d 802, 806 (9th Cir. 2010).
If the
prerequisites of Rule 23(a) are met, the Court must next
consider whether the class is maintainable under one or more
of the three alternatives set forth in Rule 23(b).
Narouz v.
Charter Communs., LLC, 591 F.3d 1261, 1266 (9th Cir. 2010).
The court must conduct a “rigorous analysis” to
determine whether the prerequisites of Rule 23 have been met.
Gen. Tel. Co. v. Falcon, 457 U.S. 147, 161 (1982).
“[T]he
merits of the class members’ substantive claims are often highly
relevant when determining whether to certify a class.
4
More
importantly, it is not correct to say a district court may
consider the merits to the extent that they overlap with class
certification issues; rather, a district court must consider
the merits if they overlap with Rule 23(a) requirements.”
Ellis v. Costco Wholesale Corp., 657 F.3d 970, 981 (9th Cir.
2011) (emphasis added).
The district court does not determine
if the class “could actually prevail on the merits of their
claims.”
Id. at 983 n.8; United Steel, 593 F.3d at 808
(citation omitted) (courts may inquire into the substance of
a case in applying the Rule 23 factors, however, courts “may
not go so far . . . as to judge the validity of these claims”).
If the court is not fully satisfied that the requirements of
Rule 23 have been met, certification should be denied.
Falcon,
457 U.S. at 161.
As to numerosity, Plaintiffs allege that “the
estimated number of eligible Medicaid recipients with autism
under the age of eighteen is 1,624.”
(Reply at 6 n.5.)
Plaintiffs concede, however, that this number is “based on
percentages and general data” and does “not identify recipients
who were prescribed or recommended ABA.”
In order to determine
which of these minors were prescribed ABA, which is a
5
requirement of class membership, Plaintiffs acknowledge that
each minor’s medical records would need to be reviewed.
The
Court finds that, at this time, Plaintiffs have not yet
“prove[n] that there are in fact sufficiently numerous
parties.”
Wal–Mart Stores, Inc., 131 S.Ct. at 2551 (emphasis
in original); Baker v. Castle & Cooke Homes Hawaii, Inc., Civ.
No. 11-00616 SOM-RLP, 2014 WL 1669158, at *4 (D. Haw. April 28,
2014).
“Commonality exists where class members’ situations
share a common issue of law or fact, and are sufficiently
parallel to insure a vigorous and full presentation of all
claims for relief.”
Wolin v. Jaguar Land Rover N. Am., LLC,
617 F.3d 1168, 1172 (9th Cir. 2010).
Typicality is satisfied
where the representative parties’ claims and class members’
claims arise “from the same course of events, and each class
member makes similar legal arguments to prove the defendant’s
liability.”
Rodriguez v. Hayes, 591 F.3d 1105, 1124 (9th Cir.
2010); Fed. R. Civ. P. 23(a).
The Ninth Circuit has noted that
the “commonality and typicality requirements of FRCP 23(a) tend
to merge.”
Meyer v. Portfolio Recovery Assocs., LLC, 707 F.3d
1036, 1041 (9th Cir. 2012).
6
In this case, based on the evidence before the Court,
several critical issues as to commonality and typicality remain
unclear.
First, it is unclear whether DHS in fact has a policy
regarding ABA treatment and what that policy is.
Plaintiffs
allege that DHS has a “blanket policy not to cover the cost of
ABA treatment” but later concedes that DHS reimbursed J.E.’s
provider for his ABA treatment.
(Motion at 5.)
In an effort
to establish DHS’s policy, Plaintiffs state that J.E.’s mother
was told that ABA treatment would not be covered, and they point
to testimony before the state legislature regarding ABA
treatment.
Although this Court is not opining on whether a
policy in fact exists, the evidence before the Court suggests
that this issue is unsettled.
Additionally, it is also unclear whether J.E. or any
proposed class members were ever denied ABA treatment.
According to Plaintiffs, J.E.’s mother “learned that ABA
treatment was not covered by Medicaid,” but his application was
later “accepted by DHS for J.E. to receive Medicaid-covered ABA
treatment from a private provider.”
(Motion at 11.)
Further,
as noted above, it is unclear whether any members of the proposed
class were denied ABA treatment or reimbursement.
7
Plaintiffs
point to no evidence showing that any minors were ever denied
treatment or reimbursement. 1
Because Plaintiffs have not yet
identified any class members and do not know whether they were
prescribed ABA and/or denied that treatment, it is premature
to determine whether class members share a common issue of law
or fact.
With respect to adequacy of representation,
“[r]equiring the claims of the class representatives to be
adequately representative of the class as a whole ensures that
the interests of absent class members are adequately
protected.”
1998).
Walters v. Reno, 145 F.3d 1036, 1046 (9th Cir.
Although the Court does not question the adequacy of
Plaintiffs’ counsel to represent class members, the Court’s
concern, as stated above, is whether DHS has a blanket policy
on ABA treatment and whether J.E. shares common issues of law
or fact with class members.
These issues overlap with class
certification requirements, are “highly relevant” to this
Court’s inquiry, and must be considered.
1
Falcon, 457 U.S. at
Plaintiffs point to Exhibit G, which is a letter from Matthew C.
Basset to the DHS Hearings Office. In that letter, Basset requests
a formal appeal hearing regarding his client’s “continued
eligibility for ABA services.” It is unknown whether the client was
prescribed ABA treatment and whether DHS in fact denied treatment
or reimbursement.
8
161; Ellis, 657 F.3d at 981.
Given the unsettled issues in this case, the Court
finds that class certification is premature at this time.
Plaintiffs are unable to satisfy the numerosity, commonality,
typicality, and adequacy requirements of Rule 23(a).
Stores, 131 S.Ct. at 2551.
Wal-Mart
The Court finds that class
certification under Rule 23 must be denied.
CONCLUSION
For the foregoing reasons, the Court adopts the
findings and recommendation of the Magistrate Judge (ECF No.
108), as modified.
Plaintiffs’ Motion for Class Certification
(Doc. 78) is DENIED without prejudice.
IT IS SO ORDERED.
DATED: Honolulu, Hawaii, March 17, 2016.
ED:
J.E., et al. v. Rachel Wong, CIV. NO. 14-00399 HG-BMK, ORDER
al v
Wong CIV NO
HG-BMK
ADOPTING MAGISTRATE JUDGE’S FINDINGS AND RECOMMENDATION (ECF
NO. 108), AS MODIFIED.
9
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