K W et al v. Armstrong et al

Filing 449

MEMORANDUM DECISION AND ORDER. IT IS ORDERED that Plaintiffs' Motion to Approve Notice to Class (Dkt. 434) is GRANTED IN PART AND DENIED IN PART. Plaintiffs' proposed class notice, modified as explained above, is APPROVED. Class counsel sh all: (1) post the revised notice on the OurHealthAndWelfare.org website; (2) post the revised notice on the Our Health and Welfare Facebook page; and (3) email the notice via the listserv. Defendants shall print and mail the notice to each class member and each class members guardian or family member. Signed by Judge B. Lynn Winmill. (caused to be mailed to non Registered Participants at the addresses listed on the Notice of Electronic Filing (NEF) by (kt)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
K.W., by his next friend D.W., et al.,
Plaintiffs,
v.
RICHARD ARMSTRONG, et al.,

Case No. 1:12-cv-00022-BLW
(lead case)
MEMORANDUM DECISION
AND ORDER

Defendants.
TOBY SCHULTZ, et al.,

Case No. 3:12-cv-58-BLW

Plaintiffs,
v.
RICHARD ARMSTRONG, et al.,
Defendants.

INTRODUCTION
Before the Court is Plaintiffs’ Motion to Approve Notice to Class and For
Defendants to Effect Notice. Dkt. 434. Plaintiffs ask the Court to: (1) approve its
notice, which informs the class of Plaintiffs’ pending Motion for Attorneys’ Fees;
(2) direct Defendants to print and mail the notice; and (3) direct class counsel to
post the notice on its OurHealthAndWelfare website, Facebook page, and email

MEMORANDUM DECISION AND ORDER - 1

listservs. For reasons explained below, the Court will grant the motion, although it
will make minor revisions to plaintiff’s form notice.
BACKGROUND
Plaintiffs are developmentally disabled adults who qualify for benefits under
Medicaid. They are eligible for long-term institutional care but choose to live
instead in their own homes or in community settings. When their Medicaid
payments were reduced, they brought this action against the Idaho Department of
Health & Welfare, alleging, among other things, that: (1) the Department’s
budgeting methodology – referred to as the budget tool – improperly reduces
assistance for some recipients; (2) the Department used an insufficient notice to
inform participants of reductions in their assistance; and (3) the process for
appealing budget reductions was unfair.
The Court certified a class of disabled adults to challenge the budget tool,
notice form, and hearing procedures. After the Court granted summary judgment in
plaintiffs’ favor, the parties settled the class claims. In the Class Action Settlement
Agreement, approved by the Court on January 12, 2017, the Department agreed to
develop a new budget tool and to keep plaintiffs’ benefits at their prior high level
until the new budgets could be approved and implemented. As part of the
settlement, the Department set a goal of developing and implementing the new

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budget tool within 24 months. See Dkt. 306,-1, at 8-9.1 If the Department failed to
implement the new tool within three years (no later than January 2020), the
plaintiffs could ask the Court “to set a reasonable completion deadline.” Id. at 9.
When the Department did not complete its work within 24 months, both
sides asked the Court to impose their version of a reasonable completion deadline.
In briefs that were filed before the COVID-19 pandemic began, the Department
asked the Court to set a completion deadline of January 12, 2023, while plaintiffs
wanted the Department to be done in 120 days. After the pandemic hit, IDHW
asked the Court to extend the completion deadline to January 2024. Plaintiffs asked
the Court to send the parties to ADR.
Initially, the Court indicated that it would impose a two-track deadline
system, with one track being a longer deadline for the restructuring of services and

1

The relevant provision states: “Action Steps and Estimated Completion. . . . . The
Department will develop estimated dates for completion with HSRI [an outside consultant] as the
project moves forward, with the goal of completing the last action step below within 24 months
of the inaugural meeting with HSRI described in action step one below. If the last action step
below is not completed within 24 months of the inaugural meeting, the Parties shall meet and
confer in an effort to identify an agreed completion deadline; if the Parties have not agreed on a
completion deadline and the last action step below is not completed within 36 months of the
inaugural meeting, class counsel may initiate the dispute resolution process set forth in Section
V.M. below and, if the deadline remains disputed after that process is completed, Plaintiffs may
file an appropriate motion and the Court shall set a reasonable completion deadline.”

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the other track being a shorter deadline for creation of the new budget tool. See
Dkt. 396. Later, though, the Court denied plaintiffs’ request to send the parties to
ADR and scheduled a hearing to resolve outstanding issues. Dkt. 420. In December
2020, after hearing the parties’ arguments, the Court ordered a reasonable
completion deadline of June 2022.
After the Court decided the reasonable completion deadline, both parties
filed the pending motions for attorneys’ fees. See Dkts. 433, 435. Additionally,
plaintiffs move for an order approving the form of a notice to be sent to class
members, informing them of the fee motion. Dkt. 434. Plaintiffs further ask the
Court to order Defendants to print and mail the notice to each class member and
class member guardian or family member.
ANALYSIS
1. Form of Notice
Under Federal Rule of Civil Procedure 23(h)(1), class counsel must notify
class members of their pending motion for attorneys’ fees. See Fed. R. Civ. P.
23(h)(1) (requiring class counsel to provide notice to the class “in a reasonable
manner”).
Defendants point out that the Court is not required to approve the notice or
the plan for distributing the notice. See Response, Dkt. 441, at 2-3. But plaintiffs
have asked for approval, and the Court finds it appropriate to provide the requested
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guidance.
Plaintiffs’ most recent version of the proposed notice, Dkt. 444, at 5-8 of 13,
incorporates all of Defendants’ proposed changes except one, which is aimed at
this paragraph:
The settlement gave the Department up to three years to fix the budget
system. Because the work wasn’t done in three years, the lawyers who
help argue for you asked the Court to set a final deadline. The Court
set a final deadline of June 2022 for the Department to finish the
work.
Revised Notice, Dkt. 444, at 6 of 13 (emphasis added). Defendants say that that
first, italicized sentence should say something more like this: “The settlement set a
goal of completing the new budget model within two years, and allowed the
lawyers who argue for you to go to court after three years.” See Dkt. 441, at 3.
Defendants’ version of the sentence is arguably more precise.2 But plaintiffs point
out that the proposed class has a Fifth Grade reading level, and defendants’
revisions to this sentence increase the reading level. Reply, Dkt. 444, at 3 (the
revisions take the sentence, on its own, to an Eleventh Grade reading level, and the
notice, overall, to a Sixth Grade reading level). Under these circumstances, the

2

Plaintiffs point out that the Court has previously used imprecise language in describing
the settlement agreements’ 24-month and 36-month time frames. That language does not,
however, change the language of the settlement agreement itself, which speaks in terms of goals
and estimates.

MEMORANDUM DECISION AND ORDER - 5

Court will favor readability over the more complex verbiage defendants proffer.
Moreover, when the offending sentence is read in context, it accurately conveys
the import of the settlement agreement and the recent litigation regarding the
reasonable completion deadline. The Court will, however, strike the word “final”
each time it appears before the word “deadline,” which is meant to address
defendants’ concerns. The end result is that the subject paragraph should be revised
as follows:
The settlement gave the Department up to three years
to fix the budget system. Because the work wasn’t done
in three years, the lawyers who help argue for you
asked the Court to set a final deadline. The Court set a
final deadline of June 2022 for the Department to finish
the work.
Otherwise, the form of notice at Dkt. 444 is approved. In the section of the notice
following titled How will the judge make a decision? the plaintiffs should select
the option that states “The judge will give a written decision.” See Dkt. 444, at 1112 of 13. And in the section of the notice entitled What can you do next?,
plaintiffs should instruct class members to mail their letters “on or before 21 days
after mailing.” To be clear though, counsel should include an actual date that is 21
days out from the mailing date.
As for the method of distribution, the Court will direct class counsel to: (1)
post the notice on the www.OurHealthAndWelfare.org website; (2) post the notice

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on the accompanying Our Health and Welfare Facebook page; and (3) email the
notice via the listserv. The Department will be ordered to print and mail the notice,
as discussed in the next section.
2. Effecting Notice
The Court finds it appropriate to shift the cost of providing this notice to the
defendants. Neither party disputes that this Court can place the cost of class notice
on the defendants. See Hunt v. Imperial Merch. Servs., Inc., 560 F.3d 1137, 1144
(9th Cir. 2009) (“[T]he proper placement of notice costs is best left to the sound
discretion of district courts, once liability on the merits has been determined in the
first instance. In such circumstances, the district courts are not required in all cases
to shift notice costs but instead may consider the totality of the circumstances to
decide whether shifting notice costs is just in that particular case.”).
In this case, where the Department failed to complete its work in the time
frames anticipated in the settlement agreement, and then sought approval for an
extensive delay, the Court finds it appropriate for defendants to bear the cost of
notifying the class members of class counsel’s fee motion, and to print and mail the
notices.
ORDER
IT IS ORDERED that:
1.

Plaintiffs’ Motion to Approve Notice to Class (Dkt. 434) is

MEMORANDUM DECISION AND ORDER - 7

GRANTED IN PART AND DENIED IN PART.
2.

Plaintiffs’ proposed class notice, modified as explained above, is
APPROVED.

3.

Class counsel shall: (1) post the revised notice on the
OurHealthAndWelfare.org website; (2) post the revised notice on the
Our Health and Welfare Facebook page; and (3) email the notice via
the listserv.

4.

Defendants shall print and mail the notice to each class member and
each class member’s guardian or family member.
DATED: May 21, 2021
_________________________
B. Lynn Winmill
U.S. District Court Judge

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