Greidinger v. Almand et al

Filing 33

MEMORANDUM OPINION. Signed by Judge Richard D Bennett on 7/3/14. (dass, Deputy Clerk)

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\l\s'f\~ICT OF r',i\Rl'LA.HiJ
IN THE UNITED STATES DISTRlCT COURT
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FOR THE DISTRICT OF MARYLAND . Iu\~Jut - 3 P I: L
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MARC ALAN GREIDINGER,

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Plairitiff,

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JAMES W, ALMAND, et al.,

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Civil Action No. RDB- I 4-1454

*

Defendants.

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MEMORANDUM OPINION
Plaintiff Marc Alan Greidinger, a resident of Virginia, licensed to practice law in
Maryland, has filed a three-count complaint against the Trustees! of the Client Protection Fund
of the Bar of Maryland (the "Fund"), alleging violations of his right to due process under the
Fourteenth Amendment of the United States Constitution and Sections 7(a) and 7(b) of the
Federal Privacy Act of 1974, 5 U,S.C.

9 552a,

following the temporary suspension of his license

to practice law in the state of Maryland. This suspension has resulted from his failure to provide
his Social Security number to the Fund.
1983, seeking

declaratory

relief,

Plaintiff brought the claims pursuant to 42 U.S.C,

specifically

to obtain

a permanent

injunction

9

against

Defendants, preventing them from obtaining an order suspending any attorneys who have failed
to provide Social Security numbers. Plaintiff also seeks to obtain an order directing Defendants
to take all necessary
Defendants'

steps to terminate his temporary

suspension,

Presently pending is

Motion to Dismiss (ECF No. 23) seeking to dismiss the complaint pursuant to

\ Specifically, the Plaintiff sued Defendants James W. Almand, in his official capacity as the Chairman of
the Client Protection Fund of Maryland, and the Trustees of the Client Protection Fund, in their official
capacities: William Myers, Cecelia Ann Keller, Leonard Shapiro, Patrick Roberson, Douglas Bregman,
Donna Hill Stateon, and David Weiss.
.

Federal Rules of Civil Procedure 12(b)(6) and 12(b)(7). A hearing was held on June 25,2014.
For the reasons that follow, Defendants' Motion to Dismiss (ECF No. 23) is GRANTED.
BACKGROUND
On a motion to dismiss, this Court accepts as true the facts alleged in Plaintiff's
complaint.

See Aziz v. Alcolac, Inc., 658 F.3d 388, 390 (4th Cir. 201 I). The Plaintiff is a

resident of Springfield,

Virginia who was admitted to practice law in Maryland in 1990.

Complaint, 3-4, ECF No.1.

Plaintiff remained a member in good standing of the Maryland Bar

until March 20, 20 I4, when his license to practice law in Maryland was temporarily suspended
due to his failure to provide his Social Security number ("SSN") to the Client Protection Fund of
the Bar of Maryland (the "Fund"). Id. Plaintiff challenges Maryland Rules (6-81 1.5(a) and 168 I 1.6(d), of the Rules adopted by Court of Appeals of Maryland pursuant to the authority
granted by Article IV

S

18(a) of the Maryland Constitution.

Maryland Rules 16-81 1.5(a) and 16-

81 I .6(d) collectively require attorneys admitted in Maryland to provide their SSNs to the Client
Protection Fund, or be suspended from practice. Id. at 2. Plaintiff challenges the two Maryland
Rules under Section 7 of the Federal Privacy Act, 5 U.S.C.

S 552a

(Note), which makes it illegal

for a governmental agency to deny an individual any right, benefit, or privilege based on the
individual's refusal to disclose his or her SSN. Id. at 2-3.
New attorneys, as applicants for admission to the Bar of Maryland, have been required to
disclose their SSNs since at least the early I 980s, as the Board of Law Examiners had a practice
of declining to process any applications that did not contain the number?
ECF No. 23-3.

Motion to Dismiss, 16,

Beginning in 1993, the Maryland General Assembly directed the Fund to

compile a list of individuals who paid their annual fee and disburse the list to the Department of

There is no evidence in the record as to whether the Plaintiff disclosed his SSN on his original Bar
application. Nevertheless, the Fund is a separate entity from the Board of Law Examiners.

2

2

Assessments and Taxation. See Assessments and Taxation Department -

Information -

Health

and Business Occupations, Professions 1993 Maryland Laws Ch. 35 I (H.B. 1052). This list was
compiled for the express purpose of "assist[ing] the Department of Assessments and Taxation in
identifying new business within the State." ld. Within this list were to be included "[t]he federal
tax identification number ("FTIN") of the person or, if the person does not have a federal tax
identification number, the social security number of the person. Jd
In 1997, the Maryland General Assembly imposed additional obligations on "licensing
authorities" to collect and report the SSN of applicants. See Md. Code Ann., Fam. Law
I 19.3(b).

S

10-

Specifically, under Section 10-1 19.3(b) of the Family Law Article of the Annotated

Code of Maryland, a licensing authority must "(1) require each applicant for a license to disclose
the Social Security number of the applicant; and (2) reco rd the applicant's
number on the application."

social Security

The Court of Appeals of Maryland was expressly designated as a

licensing authority in 2007, making the Fund the instrument by which collection of SSNs would
be implemented.

Md. Code Ann., Fam. Law

S

10-1 19.3(a)(3)(ii)(14).

The duty of the Fund to

collect and disclose SSNs was codified the next year in the Business Occupations & Professions
Article, Section 10-313, adding the requirement that the list be provided to the Comptroller of
Maryland in addition to the State Department of Assessments and Taxation. See Md. Code Ann.,
Bus. Occ. & Prof.

S 10-313.

Following the implementation of Section 10-131, then-Chief Judge Robert M. Bell of the
Maryland Court of Appeals sent a letter to all Maryland attorneys on August 13, 2009, directing
them to provide the Fund with either their SSN or tax identification number on the form provided
pursuant to Sections 10-119.3 and 10-131. Motion to Dismiss, 5, ECF No. 23-2. Within the
letter, Chief Judge Bell noted that the disclosure was mandatory and that "the statutory authority

3

for this request is Md. Code Ann., Bus. Occ. & Prof. Art.

9

10-313 and Fam. Law Art.

9

10-

119.3." Id. Chief Judge Bell also maintained that both the letter and the actions taken by the
Maryland legislature were undertaken "in accordance with Section 7 of the Privacy Act of
1974." !d. Plaintiff argues that Maryland Rules 16-811.5 and 16-811.6 violate Section 7(a) of
the Privacy Act of 1974, which provides:
It shall be unlawful for any Federal, State, or local government agency to deny
any individual any right, benefit, or privilege provided by law because of such
individual's refusal to disclose his social security account number.
Federal Privacy Act,
U.S.C.

9 552a

9 7(a),

(Note».]

Pub. 1. No. 93-579, 88 Stat. 1896,2194 (contained as amended in 5

The only exceptions under the Privacy Act are "any disclosure which is

required by Federal statute" or "disclosure required under statute or regulation adopted prior to
Jan. 1,1975." Federal Privacy Act
93-579,88

9

7(a)(2)(A) & Federal Privacy Act

Stat. at 2194 (codified as amended at 5 U.S.C.

9

9

7(a)(2)(B), Pub. L. No.

552a (Note». The Plaintiff asserts

that neither exception applies in this case. Furthermore, Section 7(b) of the Privacy Act requires
that "[a]ny Federal, State, or local government agency which requests an individual to disclose
his social security account number shall inform that individual whether that disclosure is
mandatory or voluntary, by what statutory authority such number is solicited, and what uses will
be made of it." Federal Privacy Act
amended at 5 U.S.c.
Despite

the

9 552a

9

7(b), Pub. 1. No. 93-579, 88 Stat. at 2194 (codified as

(Note».

measures

taken

to. promote

compliance

with

the vanous

statutes,

approximately 9, I 00 attorneys failed to disclose their SSNs in accordance with the letter sent by
Chief Judge Bell. Motion to Dismiss, 16, ECF No. 23-3. The Attorney Grievance Commission
3 Although not codified in the United States Code, Section 7 is contained in the "Historical and Statutory"
note to 5 U.S.C. S 552a. Therefore, it is considered a "Statute at Large," 88 Stat. 1896,2194, and is a law
of the United States. See Schwier v. Cox, 340 F.3d 1284, 1288-89 (lith Cir. 2003) (reversing district
court's conclusion that because Section 7 is uncodified, it is a "dead letter"; "the Code cannot prevail over
the Statutes at Large when the two are inconsistent.").

4

of Maryland, through the Office of Bar Counsel, was the sole body tasked with ensuring that
lawyers complied with the requirement.

As a result of the sheer number of non-compliant

attorneys, Bar Counsel was overburdened with enforcing the requirement through the Maryland
Lawyers' Rules of Professional Conduct.

Md. Rule 16-812.

In addition, the judiciary was

threatened with the divestment of one million dollars ($1,000,000) from the State's general fund
appropriation after a legislative audit determined that the Maryland Child Support Enforcement
Administration (CSEA) did not effectively use license suspensions as an enforcement tool. See
Audit

Report,

Maryland

Department

of Human

Resources,

Child

Support

Enforcement

Administration (September 2011) p. 12.4
In attempting to remedy this administrative and budgetary fiasco, the Maryland Rules
Committee

recommended,

("Obligations

of Attorneys")

November 21,2013.

and the Court of Appeals

adopted,

Maryland

and Maryland Rule 16-811.6 ("Enforcement

Rule

16-811.5

Obligations")

on

Motion to Dismiss, 16, ECF No. 23-3. Maryland Rule 16-811.5(a) requires

every attorney admitted to practice in Maryland to "proyide to the treasurer of the [Client
Protection Fund] the attorney's Social Security number."

Maryland Rule 16-811.6(d) requires

the Trustees of the Fund to submit to the Court of Appeals a list of the names and account
numbers

of any attorneys

who have failed to provide

their Social

Security

numbers.

Furthermore, under that provision, "the Court of Appeals shall enter a Temporary Suspension
Order prohibiting each of [the individuals on the list] from practicing law in the State,"
Rule 16-811.6(d).

Notably, during the recommendation

Md.

process, the Chair of the Standing

Committee on Rules of Practice and Procedure, the Honorable Alan M. Wilner, retired Judge of
the Court of Appeals, addressed the Privacy Act issues, stating "each of the statutory obligations
[to disclose SSNs] is either required or expressly permitted by a Federal statute subsequent to the
4

The Report is available at http://www.ola.state.md.usfReportsfFiscal%20CompJiance/CSEA
II.pdf.
5

Privacy Act and thus falls within the express exception set forth in [Section] 7(a)(2) of the
Privacy Act."

Motion to Dismiss, 23, ECF. No. 23-3. Following the passage of these two rules,

Chief Judge Bell wrote a letter on May I, 2013 informing the Maryland General Assembly that
the Judiciary had substantially complied with the audit recommendation so that the $1 million in
withheld funds could be released. Motion to Dismiss, 9-10, ECF. No. 23-2.
Following the adoption of the new Rules, a number of attorneys still did not provide their
SSNs. Motion to Dismiss, 9, ECF No. 23-2. In response, Chief Judge Bell sent two other letters
to the delinquent attorneys in February and March of 2013 notifying them that they had not
complied with the SSN disclosure obligation under Md. Code Ann., Bus. ace.
Fam. Law

9

10-119.3.

9

10-313 and

See Motion to Dismiss, 7, ECF No. 23-2; Complaint, 2, ECF No. 1-4.

Specifically, the letter in March maintained that any attorney who had thus far failed to provide
his or her SSN could avoid disciplinary action by providing it within the next ten days.
Complaint, 2, ECF No. 1-4.
Plaintiff responded to that letter on April 11,2013, stating that he believed the mandatory
disclosure provision of the new Maryland Rules violated the Federal Privacy Act. Complaint, 2,
ECF No. 1-5. On February 10,2014,

Defendant James Almand, the Chairman of the Client

Protection Fund, sent a Final Notification of Delinquency to the Plaintiff, stating that if he did
not comply with the requirement within thirty days, he would be suspended from practice.
Complaint, 2, ECF No. 1-6. Plaintiff again responded on March 11, 2014, reiterating his prior
legal argument.

Complaint, ECF No. 1-7. In addition to the letter, Plaintiff tendered his federal

tax identification number along with a sealed envelope containing his SSN and a request that it
not be opened until he was given an opportunity to present his objections. ld at 2. On March 14,
2014 the Fund sent a letter in response, stating that the Plaintiffs

6

submission was not in

compliance, citing Maryland Rule 16-811.5(a)(I) for the first time. Complaint, 2, ECF No. 1-6.
On March 20, 2014, Plaintiff's license to practice in Maryland was temporarily suspended by
order of the Court of Appeals, along with forty-two other attorneys who did not provide their
SSNs. Complaint, ECF No. 1-9.
The Plaintiff again wrote to the Court of Appeals, this time to Chief Judge Mary Ellen
Barbera, asking that his suspension be delayed until his legal argument could be heard and ruled
upon. Supplement to Complaint, 2-3, ECF NO.8-I.
remains suspended.

His request was not granted and his license

As a result of his temporary suspension, Plaintiff has stopped representing

existing clients, is barred from accepting referrals from the Bar, and is prevented from gaining
new clients of his own. This suspension has been placed on Plaintiff both in Maryland and in
Virginia, where he is admitted pro hac vice based on his Maryland admission.
In the three-count Complaint, Plaintiff has asserted causes of action pursuant to 42 U.S.C.

9

1983 for violations of the Privacy Act and his right to procedural due process. Complaint, 7-9,

ECF No. I.

In Count I, Plaintiff argues that his law license is a right, benefit, or privilege

protected by law, and that Defendants acted under color of state law to deprive him of that
license in violation of Section 7(a) of the Privacy Act. Id. at 7. In Count II, Plaintiff argues
Defendants failed to abide by Section 7(b) of the Privacy Act by failing to provide information
regarding (I) the statutory or other authority for the requirement that he provide his SSN and (2)
the uses to be made of the information.

Id. at 8. In Count III, Plaintiff further argues that his

suspension, without a hearing before a neutral tribunal, violated his procedural due process
rights. Id. In terms of remedies, Plaintiff seeks a declaration that the requirements in Maryland
Rules 16-811.5 and 16-811.6 relating to suspension from law practice for failure to disclose his
Social Security number without a hearing violated his procedural due process rights. Id. at 9.

7

Plaintiff also seeks equitable relief permanently enjoining the Defendants from enforcing the
Maryland Rules provisions at issue, and directing the Defendants to take action that will reinstate
his license to practice law in Maryland.

Id. Plaintiff also seeks attorneys' fees and costs, and

demands a trial by jury. ld.
Concurrent with the filing of his Complaint, the Plaintiff moved for a Temporary
Restraining Order and Preliminary Injunction.

Motion for a Temporary Restraining Order, ECF

NO.2. The motion for a Preliminary Injunction was denied by this Court on May 2, 2014. Order
Denying Motion for a Temporary Restraining Order, ECF. No. 14.

This Court then set an

expedited schedule for the briefing of dispositive motions.
Defendants have filed the subject Motion to Dismiss, or in the alternative, for Summary
. Judgment pursuant to Federal Rules of Civil Procedure 12(b)(6) and 12(b)(7), alleging that
Plaintiff failed to state a claim for which he is entitled to relief and failed to join a necessary
party to the action. Motion to Dismiss, ECF No. 23. Defendants contend that Plaintiff fails to
state a cognizable

claim because the Privacy Act is superseded by other federal statutes

contained in the Social Security Act, specifically the Welfare Reform Act, 42 U.S.C.
666"), and the Tax Reform Act of 1976, 42 U.S.C.

9 405 ( "9

9 666 ( "9

405"). Id. at 18-26. Defendants

additionally claim that even if the Privacy Act is not superseded by these statutes, there is no
private right of action under Section 7 of the Privacy Act for individuals. Id. With respect to the
Rule 12(b)(7) argument, Defendants claim that only the Judges of the Maryland Court of
Appeals -

who are not parties in the pending litigation -

can terminate the suspension and thus

effect the remedy that Plaintiff seeks. Id. at 12-14. In seeking to refute Plaintiffs

due process

claim, Defendants contend that Plaintiff was not entitled to any hearing because there is no
factual dispute that Plaintiff failed to disclose his SSN as required by Md. Rule 16-81 l.5(a)(I).

8

Id at 27-30. Additionally, it is argued that Plaintiff had the opportunity to seek a review of the
findings of the Fund under Md. Rule 16-811.10, but declined to do so. Id at 29-30 .. Lastly,
Defendants claim that the actions taken by the Fund did not violate Section 7(b) of the Privacy
Act due to the fact that Chief Judge Bell's letter complied with the requirements to state the
authority under which the SSNs were sought and their intended use. Id at 30-32.
STANDARD OF REVIEW
Under Rule 8(a)(2) of the Federal Rules of Civil Procedure, a complaint must contain a
"short and plain statement of the claim showing that the pleader is entitled to relief."

Fed. R.

Civ. P 8(a)(2). Rule 12(b)(6) of the Federal Rules of Civil Procedure authorizes the dismissal of
a complaint if it fails to state a claim upon which relief can be granted.

The purpose of Rule

12(b)(6) is "to test the sufficiency of a complaint and not to resolve contests surrounding the
facts, the merits of a claim, or the applicability of defenses."

Presley v. City of Charlottesville,

464 F.3d 480, 483 (4th Cir. 2006).
The Supreme Court's opinions in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007),
and Ashcroft v. Iqbal, 556 U.S. 662 (2009), "require that complaints in civil actions be alleged
with greater specificity than previously was required."
(4th Cir. 2012) (citation omitted).

Walters v. McMahen, 684 FJd 435, 439

In Twombly, the Supreme Court articulated "[t)wo working

principles" that courts must employ when ruling on Rule 12(b)(6) motions to dismiss. Iqbal,556
U.S. at 678. First, while a court must accept as true all the factual allegations contained in the
complaint, legal conclusions drawn from those facts are not afforded such deference. Id (stating
that "[t)hreadbare recitals of the elements of a cause of action, supported by mere conclusory
statements, do not suffice" to plead a claim); see also Wag More Dogs, LLC v. Cozart, 680 FJd
359, 365 (4th Cir. 2012) ("Although we are constrained to take the facts in the light most

9

favorable to the plaintiff, we need not accept legal conclusions couched as facts or unwarranted
inferences,

unreasonable

conclusions,

or arguments."

(internal quotation

marks omitted».

Second, a complaint must be dismissed if it does not allege "a plausible claim for relief." Iqbal,
556 U.S. at 679.
Pursuant to Rule 12(b)(7) of the Federal Rules of Civil Procedure, a case may be
dismissed for "failure to join a party under Rule 19." A Rule 12(b)(7) motion proceeds by a twostep inquiry. First, the court must ask "whether a party is necessary to a proceeding because of
its relationship to the matter under consideration pursuant to Rule 19(a)."

Owens-Ill., Inc. v.

Meade, 186 F.3d 435, 440 (4th Cir. 1999) (citation and internal quotation marks omitted). If the
party is necessary, it will be ordered into the action unless it destroys the court's jurisdiction.

Id

Second, "[w]hen a party cannot be joined because its joinder destroys diversity, the court must
determine whether the proceeding can continue in its absence, or whether it is indispensable
pursuant to Rule 19(b) and the action must be dismissed."

Owens-Ill., Inc., 186 F.3d at 440. The

burden is on the moving party to "show that the entity who was not joined is needed for a just
adjudication."

Riesett, 2013 WL 5276553, at *2 (quoting Am. Gen. Life & Accident Ins. Co. v.

Wood, 429 F.3d 83, 92 (4th Cir. 2005». "Courts are loath to dismiss cases based on nonjoinder
of a party, so dismissal will be ordered only when the resulting defect cannot be remedied and
prejudice or inefficiency will certainly result." Owens-Ill., Inc., 186 F.3d at 441.
ANALYSIS
Defendant

seeks to dismiss the complaint under Federal Rules of Civil Procedure

12(b)(6) and 12(b)(7). Pursuant to Rule 12(b)(6), Defendants have demonstrated that both 42
U.S.c. ~ 666 and 42 U.S.C. ~ 405 supersede the Privacy Act.
. 666 or

S

Plaintiff concedes that if either ~

405 supersede the Privacy Act, this Court need not address the question of whether a

10

private cause of action lies under Section 7 of the Privacy Act. In addition, because Plaintiff has
failed to state claim under Rule 12(b)(6), the question of whether he failed to join a party
necessary to the action under Rule 12(b)(7) is rende red moot.

This Court also finds

that

Defendants substantially complied with the mandates of Section 7(h) of the Privacy Act via the
letter sent by Chief Judge Bell in 2009.5 Lastly, this Court finds that Plaintiff was not denied his
Constitutional

right to due process under the Fourteenth Amendment.

6

For these reasons,

Defendant's Motion to Dismiss will be granted.
I.

Section 7(a)(I) of the Privacy Act is Superseded

by Federal Statute

Section 7(a)(l) of the Federal Privacy Statute states that "it shall be unlawful for any
Federal, State, or local government agency to deny any individual any right, benefit, or privilege
provided by law because of such individual's
Federal Privacy Act

S 552a

(Note».

S 7, Pub.

refusal to disclose his social security number."

1. No. 93-579, 88 Stat. at 2194 (contained as amended in 5 U.S.c.

While the construction of the statute is broad on its face, Sections 7(a)(2)(a) and

5 Section 7(b) of the Federal Privacy Act mandates that "Any Federal, State, or local government agency
which requests an individual to disclose his social security number shall inform that individual whether
than disclosure is mandatory or voluntary, by what statutory or other authority such number is solicited,
and what uses will be made of it." Plaintiff contends that the final two provisions - the authority and use
provisions - were not met. This argument, however, can be dismissed out of hand. In terms of
authority, the letter from Chief Judge Bell to all Maryland attorneys stated that "the statutory authority for
this request is Md. Code Ann. Bus., Occ. & Prof. Art. ~ 10-313 and Fam. Law Art. ~ 10-119.3."
Addressing the use of the information, the letter stated the information would be used "to assist the
comptroller in determining whether each lawyer on the list has paid all undisputed taxes and
unemployment insurance .... " Accordingly, the statements in Chief Judge Bell's letter met any
requirements imposed by Section 7(b).
6 Plaintiff's due process claim is also clearly deficient, given that he had a litany of opportunities to raise
his legal claims. At the outset, Plaintiff was able to raise his arguments with the Fund in a number of
letters. These contentions were clearly considered, but ultimately denied. Plaintiff was also entitled to a
hearing regarding the determination of the Fund under Md. Rule 16-811.10, which states: "A person
aggrieved by a final determination of the trustees may seek judicial review of the determination pursuant
to Title 7, Chapter 200 of the Maryland Rules." Although Plaintiff contends that this provision only
applies to Md. Rule16-811.9, it is clear from a plain reading of the provision it also applies to Md. Rules
16-811.5 and 16-811.6. Furthermore, Plaintiff was able to bring the action in this Court, which has
jurisdiction to render a decision on Plaintiff's claim. Accordingly, his due process claim is subject to
dismissal.

II

7(a)(2)(b) significantly

restrict its applicability.

ld.

Specifically,

Sections 7(a)(2)(a) and

7(a)(2)(b) hold that the protection afforded by 7(a)(1) will not apply to "any disclosure which is
required by Federal Statute" or "the disclosure of a social security number to any federal, state,
or local agency maintaining a system of records in existence and operating before January 1,
1975."

ld.

Therefore, any federal statute which mandates the disclosure of Social Security

.numbers can implicitly or expressly override the protections afforded by the Federal Privacy Act.
Far from just being a tool of the federal authorities, state and local entities acting pursuant to
federal statutes have invoked this exception to the Federal Privacy Act. See Stoianoffv. Comm'r

of Motor Vehicles, 107 F. Supp. 2d 439, 445 (S.D.N.Y. 2000); see also Dittman v. State of
California, 191 F.3d 1020, 1026 (9th Cir. 1999). Because it is clear that Md. Rules 16-811.5 and
16-811.6 were enacted pursuant to 42 U.S.C.

S 666 and

42 U.S.c.

S 405

and both statutes clearly

supersede the Federal Privacy Act, Plaintiff has failed to raise a cognizable claim which would
entitle him to relief.
A. 42 U.S.c. ~ 666 Supersedes the Privacy Act by Requiring the Collection of Social
Security Numbers for Child Support Enforcement
Defendants contend that the Welfare Reform Act, 42 U.S.C.

S 666

implicitly supersedes

the Federal Privacy Act by authorizing state lawmakers to collect the social security numbers of
individuals applying for professional licenses. Under

S 666(a),

the federal government mandated

that in order to receive continued federal funding "each state must have in effect laws ...
increase the effectiveness of the [child support enforcement] program the state administers."

to
The.

collection and distribution of SSNs was primarily undertaken to create a computerized system
that allowed state Child Support Enforcement Administrations
and sanction individuals in arrearage.
Maryland

Department

of Human

See 42 U.S.C.

Resources,

12

S

("CSEA") to effectively target

666(a)(3); see also Audit Report,

Child Support

Enforcement

Administration

(September 2011) p. 12. As part of this holistic reform to child support enforcement, 42 U.S.C.

S

666(a)(13) requires that the state implement "procedures requiring that the social security

number of any applicant for a professional

license, drivers license, occupational

recreational license, or marriage license be recorded on the application."

S 666(a)(l6)

restrictions to professional licenses, 42 U.S.c.

In furtherance of

created procedures under which the

"State has (and uses in appropriate cases) authority to withhold or suspend
occupational licenses ...

license,

of individuals owing overdue support or failing

professional and
to comply with

subpoenas or warrants relating to paternity or child support proceedings." Moreover, states were
also required to enact procedures to afford the federal government "automated access" to the
"records of occupational and professional licenses" for the purpose of enforcing child support
payments. 42 U.S.c.

S 666(l9)(c)(I)(D).
S

666, in 1997 the state of Mary land immediately

began reforming its means of data collection.

See 1997 Md. Laws Ch. 609. This effort began

In response to the requirements of

with the enactment of Md. Code Ann., Fam. Law

S

119.3(b) which mandated that all licensing

authorities "shall (I) require each applicant for a license to disclose the social security number of
the applicant;

and (2) record the applicant's

social security number

Moreover, under Md. Code Ann., Fam. Law
authorized

the Maryland

S

lI9.3(c),

Child Support Enforcement

on the application."

the Maryland General Assembly

Administration

("CSEA")

to request

information from the licensing authorities concerning "any obligor in arrears in paying child
support," and directed the licensing authorities to "periodically share its licensing database with
the administration."

In terms of an enforcement mechanism, Md. Code Ann., Fam. Law

S

lI9.3(e) permits the CSEA to request a licensing agency to "suspend or deny an individual's
license," whereby the licensing authority "shall suspend ...

13

or deny an individual's

license,"

subject to certain limitations. In order to more fully comply with the stated purpose of
Maryland

Rules Committee

approved

Md. Rules

S 666,

16-811.5 and 16-811.6, mandating

the
the

disclosure of every attorney's social security number.
Plaintiffs

S

sole contention is that

"applicant," as defined by

S 666(a)(l3).

666 does not apply to him because he is not an

Furthermore, Plaintiff claims that Congress intended to

exclude attorneys admitted before 1997 from the disclosure requirement, under the theory that
younger attorneys should have to bear the burden of implementation.

In response, Defendants

claim that a narrow construction of the word "applicant" leads to an unsatisfactory outcome and
the record shows no intent to create a "grandfather clause."

This Court finds the theory of

Plaintiff without merit and contrary to the express intent of Congress.
Although Plaintiffs

claim that the word "applicant" should be considered to include only

those who are applying or reapplying for a license, the evidence points toward a broader
definition of the term.

At the outset, it is clear that nothing in the Social Security Act or the

Welfare Reform Act makes the distinction between "applicant" and "licensee" that Plaintiff now
advances.

See 42 U.S.C.

by Plaintiff,

S 666(16)

S 666.

Rather, in direct opposition to the narrow definition advanced

allows a state body to either "withhold or suspend" an individual's license

for failing to comply with

S

666(a)(l3).

Taking these two provisions together, it is clear that a

reading of the word "applicant" that excludes current license holders would render the threat of
suspension under

S

666(16) meaningless;

applicants cannot be suspended, only those who

already hold a license can. This Court does not interpret the word "applicant" so narrowly in this
context. See, e.g., Discover Bank v. Vaden, 396 F.3d 366, 369 (4th Cir. 2005) ("It is a classic
canon of statutory construction that courts must give effect to every provision and word in a
statute

and

avoid

any interpretation

that may render

14

statutory

terms

meaningless

or

superfluous.") (citation omitted).

Moreover, this Court abides by the Supreme Court's recent

admonition to avoid a "reading [that] would undermine--indeed,
would virtually repeal ... the law's core provisions."

for all important purposes,

Abramski v. United Slates, _

u.S. _'

134 S. Ct. 2259,2267 (2014).
Furthermore, it is clear that under ~ 666 the federal government intended to implement a
system which required complete disclosure of SSNs by every individual who is subject to a
licensing authority in order to streamline CSEA enforcement.

As part of the Welfare Reform

Act, which encompasses ~ 666, the House Report stated that with the implementation of ~ 666
"enforcement

[will be] significantly strengthened to ensure that absent noncustodial parents

provide financial support for their children." H. Rep. No.1 04-651 at 5 (1996). Furthermore, the
Act seeks to establish "uniform state tracking procedures ...

established to catch deadbeat

parents," which full disclosure of social security numbers would facilitate.

In terms of the

mechanism itself, the federal government sought to "combin[ e] the new databases, the SSNs.
from license applications, and the e~panded [the Federal Parent Locator Service]" in order to
"create 'a rapid response and automated mechanism to locate and withhold wages legally
obligated for child support payments.'''

H. Rep. No. 104-651 at 5 (1996); Michigan Dep't of

Slale v. United States, 166 F. Supp. 2d 1228, 1232 (W.D. Mich. 2001) (quoting H.R. Rep. No.
104-651, at 1405 (1996)).

Even at a fundamental level, the exemption of individuals from a

uniform enforcement mechanism reduces its overall effectiveness.

Indeed, the audit undertaken

by the Maryland Department of Human Resources noted that the "Court [of Appeals] did not
have social security numbers for approximately 9,800 attorneys" and that because of the lack of
information "CSEA [was] precluded from performing automated matches of the licensing data."

15

Audit Report, Department of Human Resources, Child Support Enforcement Administration
(September 2011) p. 12.
Significantly, Defendants also note that nearly every professional

licensing agency in

Maryland requires individuals to intermittently reapply. See, e.g, Md. Code Ann., Bus. Occ. &
Prof.

S 2-311, S 3-309, S 4-310, S 5-311, S 6-310, S 6.5-312, S 7-308, S

308,

S

14-314,

S

16-3A-07,

S

17-314,

S

8-307,

S

11-408,

S

13-

18-307. The sole exception to this all-encompassing

reapplication scheme is the legal profession, as attorneys may renew their licenses indefinitely by
paying the fees imposed by the Fund. Motion to Dismiss, 23, ECF No. 23-1. Therefore, up until
the enactment of Md. Rules 16-811.5 and 16-811.6, attorneys who passed the bar before 1997
were the only group of licensed individuals who had been able to avoid mandatory
disclosure.

Id. at 24.

"practitioners"

While Plaintiff

as well as "applicants" in

may claim that Congress

S

SSN

could have included

666, there is no basis to suggest that Congress

intended to exempt a small number of licensed practitioners within a single profession from a
mandatory disclosure regime. Rather, given that the payment of a fee is perhaps the closest thing
to a reapplication procedure, the requirement placed on attorneys by Md. Rules 16-811.5 and 16811.6 is more rationally characterized as a necessary remedial measure than an unwarranted
intrusion into private information.
Moreover, Plaintiff's claim that

S 666

was not meant to apply to individuals or impose

the suspension of professional licenses is similarly misguided.
that both

S 666(13)

and

S 666(16)

While Plaintiff correctly states

are expressly directed at the state, the language of the statute

obviously contemplates individual compliance with whatever state action is taken pursuant to the.
federal mandate. For example,

S 666(13)

mandates that the state enact legislation "requiring that

the social security number of any applicant for a professional license ...

16

be recorded on the

application,"

making

individual

compliance

absolutely

essential.

As previously

stated,

individual compliance with the federal statute and its state incarnations have clear implications in
terms of the effectiveness of the enforcement mechanism contemplated in
fact that the judiciary

was threatened

S 666.

Moreover, the

with funding divestments

reflects that individual

compliance is vital to state implementation of the federal requirement.

See Motion to Dismiss,

4-7, ECFNo. 23-4.
Likewise, Plaintiffs
permitted under

S

contention that the suspensIOn of a professional

license is not

666 unless an individual is in arrearage only follows from an excessively

narrow reading of the statute.

Regardless of whether the suspension is specifically required, it

must first be noted that it would be impossible to impose a mandatory disclosure requirement
without some sort of enforcement mechanism.

Given that

S 666

does not specify a penalty for

individual failure to disclose, it follows that the states were permitted to administer a reasonable
penalty to force compliance with the federal statute. Furthermore, the suspension administered
in this case was temporary, bringing it within the ambit of what the statute otherwise permitted.

See 42 U.S.C.

S 666

(a)(5)(D)(iii); 42 U.S.C

S 666(16).

In addition, the audit undertaken by the

Maryland Department of Human Resources noted that the Court of Appeals was failing to
adequately make use of an enforcement tool to suspend the licenses of attorneys. Audit Report,
Maryland

Department

of Human

Resources,

Child Support

Enforcement

Administration

(September 2011) p. 12.
Therefore, interpreting

S 666

to exclude Plaintiff clearly leads to a result that is patently

inconsistent with the plain language of the statute or the expressed legislative intent. Moreover,
this Court summarily rejects any literal definition of "applicant" which would obviously thwart
the purpose of the statute in creating a uniform enforcement mechanism. As a result, this Court

17

finds that

S

666 supersedes Section 7 of the Privacy Act, rendering Plaintiffs

Complaint

irreparably deficient in terms of the Privacy Act claim.
B. 42 U.S.c. ~ 405 Supersedes the Privacy Act by Authorizing
Social Security Numbers in the Administration of a Tax
Furthermore,

Defendants

the Collection of

note that the Tax Reform Act of 1976, 42 U.S.c.

supersedes the Federal Privacy Act. Specifically, 42 U.S.C.

S 405(c)(2)(C)(i)

S

405

provides:

It is the policy of the United States that any State (or political subdivision thereof)
may, in the administration of any tax, general public assistance, driver's license,
or motor vehicle registration law ... utilize the social security account numbers
issued by the Commissioner of Social Security for the purpose of establishing the
identification of individuals affected by such law, and may require any individual
who is or appears to be so affected to furnish to such State (or political
subdivision thereof) or any agency thereof having administrative responsibility
for the law involved, the [individual's] social security account number ....

Section 405(c)(2)(C)(v)

also expressly supersedes prevIOus legislation by holding that any

provision of federal law inconsistent "with the policy set forth in clause (i) ... shall on and after
the date of enactment of this subparagraph [Oct. 4, 1976] be null, void, and of no effect." Courts
have recognized the preeminence of the Tax Reform Act by holding that it supersedes the
Privacy Act in a number of contexts. See Peterson v. City of Detroit, 76 F. App'x 601, 602 (6th
Cir. 2003); StoianojJ, 107 F. Supp. 2d at 445. The United States Court of Appeals for the Sixth
Circuit held, in a case concerning taxicab licensing, that "Section 7 of the Federal Privacy Act
insofar as it relates to the privilege at issue in this case, has been superseded by a subsequent
amendment to the Social Security Act, 42 U.S.C.

S 405(c)(2)(C)(v)."

Peterson, 76 F. App'x at

602. Moreover, the United States District Court of the Southern District of New York denied an
action under the Federal Privacy Act regarding the disc!osure of an individual's

SSN to the

Department of Motor Vehicles for driver's license purposes, stating "[b]ecause the uncodified

18

Section 7(a)(l) of the Privacy Act conflicted with the policy statement contained in the 1976
amendment to the Social Security Act, it would have become 'null and void and of no effect' as
of October 1976, pursuant to 42 U.S.c.

S 405(c)(2)(C)(v)."

Stoianoff, 107 F. Supp. 2d at 445.

This Court finds these decisions persuasive in their reasoning as to

S 405's

effect on Section 7 of

the Privacy Act.
The legislative history, likewise, supports the contention that Congress considered the
competing

rationales

405(c)(2)(C)(v).

for

S

405 and the Federal Privacy Act before opting to include

S

The Senate Committee on Finance did note that "Federal, State and local

agencies may not deny any individual any rights ...

provided by law because such individual

refuses to disclose his social security number," directly in keeping with Section 7 of the Privacy
Act.

S

See S. Rep. No. 94-938 at 391 (1976). However, the Committee advocated the passage of

405, stating it "believe(d] that State and local governments should have the authority to use

social security numbers

for identification

purposes

when they consider

it necessary

for

ad':linistrative purposes."

Id. at 392. Furthermore, in explaining the reform in its totality, the

Committee maintained that the Act was amended "to establish the policy ... that any State may
use social security numbers for the purpose of establishing the identification
affected by any law or program within its jurisdiction ...

of individuals

(and] in addition, require any such

individual to furnish his social security number." Id at 391-92. The Committee also echoed the
language in

S

405( c)(2)(C)(v) by stating, "This amendment further provides that to the extent

that any existing provision of Federal law is inconsistent with the policy set forth above, such
provisions shall be null, void and of no effect." Id.
Plaintiff claims that because

S

405( c)(2)(C)(i) states that SSN disclosure is required "in

the administration of any tax," it necessarily follows that the agency administering the tax -

19

in

this case, either the Maryland Comptroller or the State Department of Assessments and Taxation
-

must request the disclosure. He cites no authority for this proposition.

It is clear that a plain

reading of the statute does not support such a restrictive approach to SSN disclosure requests.
Despit" th" fuel Ij 4Q5(c)(2}(C)(i) mentions "any agency having administrative responsibility for
the law involved" in reference to entities to which an individual can be commanded to disclose
his SSN, the statute also allows "the state (or any subdivision thereof)" to request a disclosure.
See 42 U.S.C.

S

Maryland judicial

405(c)(2)(C)(i).

Given that the Court of Appeals sits at the apex of the

system, it would be impossible to contend that this disclosure was not

requested at the behest of a subdivision of the state of Maryland.

Moreover, Plaintiff's attempt

to distinguish driver's licenses and professional licenses in an action under the Federal Privacy
Act is not supported by the applicable case law. Plaintiff claims Peterson is distinguishable due
to the fact the Sixth Circuit found that the taxi cab license could be denied in the "administration
of any ... drivers license ... law," rather than in "the administration of any tax." Peterson, 76 F.
App'x

at 602.

However,

that decision

solely cites

S

405( c)(2)(C)(i),

which lists the

"administration of any tax" in conjunction with the "administration of any ... driver's license."
See 42 U.S.c.

405(c)(2)(C)(i).

instances in which

S 405

Without any statutory language differentiating

the various

can mandate the disclosure of an individual's SSN, there is simply no

basis to make such artificial distinctions.
Finally, Plaintiff contends that the use of the word "may" in the statute renders it
permissive and places it completely outside of the exception in Section 7(a)(2)(A) ofthe Privacy
Act. The Plaintiff cites no authority adopting a reading that the State somehow would have the
option not to require SSN disclosure in administering taxes. Meanwhile, the Sixth Circuit and
the Southern District of New York persuasively reason that

20

S

405 supersedes Section 7. It is

clear that

S

405( c)(2)(C)(i) expressly permits the state to impose such a requirement under the

color of federal law. Moreover, even if the statutory language is less than clear, the legislative
history provides ample evidence that the Senate Finance Committee believed the needs of State
and local govcmment~ trumped individual privacy in this context, &e S. Rep. No. 94-938 at 392
(1976) ("the committee believes that State and local governments should have the authority to
use social security numbers for identification purposes when they consider it necessary for
administrative

reasons."). Therefore, this Court finds that

S

405 supersedes Section 7 of the

Privacy Act. 7
II.

Private Right of Action Under Section 7 of the Federal Privacy Act
As this Court has already found that both 42 U.S.C.

S 666

and 42 U.S.C.

S 405

supersede

Section 7 the Privacy Act, this Court need not decide whether there is a private cause of action
for an individual under Section 7. As both parties have stipulated, the question as to whether an
individual has an implied private right of action under 42 U.S.C.

S

1983 for the violation of

Section 7 of the Federal Privacy Act is an open question in the Fourth Circuit.
Cain, 2:10-CV-01182,

See White v.

2011 WL 1087489, at *7 (S.D. W. Va. Mar. 21, 2011) ("It is an open

question in this circuit whether Section 7 of the Privacy Act "creates a right, privilege, or
immunity enforceable under
1998)- (unpublished).

S

1983."); Deeds v. Cnty. of Fairfax, Va., 151 F.3d 1028 (4th Cir.

Moreover, application of the Privacy Act in reference to the suspension of

Plaintiff also claims that that because Md. Code Ann., Bus. Occ. & Prof. 9 10-313(b) expresses a
preference for the disclosure of the federal tax identification number as opposed to a SSN, the Privacy Act
is not necessarily incompatible with 42 U.S.C. 9 405. However, given that not every individual has a tax
identification number and, almost without exception every individual has a SSN, the disclosure
requirement is still necessary and within the ambit of 9405. Additionally, Plaintifffaiis to note that Md.
Code Ann., Fam. Law 9 119.3 does not give individuals the option to disclose their tax identification
number instead of their SSN. Rather, Md. Code Ann., Fam. Law 9 119.3(b)(I) states a licensing
authority will "require each applicant for a license to disclose the Social Security number of the
applicant." Therefore the Federal Privacy Act is clearly in conflict with both Maryland provisions
adopted pursuant to 9 405.
7

21

the right to practice law appears to be an issue of first impression. Accordingly, this Court heeds
the sagacious words of Chief Judge Goodwin of the United States District Court for the Southern
District of West Virginia in "not follow[ing] the child of calamity into the murky waters of
Privacy Act jurisprudence."

White, 2011 WL 1087489, at *7. However, this Court notes that a

private right of action has been recognized in certain circumstances.
Mainly, such rights have been found when fundamental rights are denied. For example,
in Schwier v. Cox, 340 F.3d 1284 (lith Cir. 2003), the Eleventh Circuit held that a private right
of action exists where plaintiffs' voter registration applications were denied after they refused to
disclose their SSNs. This holding was essentially echoed in McKay v. A/tabella, No. Civ.A. 963458,1997

WL 266717 (E.D. La. May~6, 1997), where the United States District Court for the

Eastern District of Louisiana found that the Privacy Act precluded the Registrar of Voters from
preventing an individual to vote based on the refusal to disclose his or her social security
number.

Indeed, the Plaintiff in this case successfully challenged a Virginia law requiring the

disclosure of his SSN on his voter registration application where the information would be made
available to the public.

Greidinger v. Davis, 988 F.2d 1344 (4th Cir. 1993).

Similarly,

fundamental rights were at issue in Szymecki v. City of Norfolk, where Judge Morgan of the
Eastern District of Virginia held that a private cause of action existed when a law enforcement
officer twice demanded plaintiff's SSN, and threatened him with incarceration and withholding
of his lawfully carried firearm for refusing to provide

the information.

See No. CIV.

2:08CVI42, 2008 WL 4223620 (E.D. Va. Sept. 11,2008) (finding the rationale of the Eleventh
Circuit in Schwier "persuasive").
On the other hand, Courts have been reticent to recognize a private right of action when
the right in question is less fundamental and well recognized.

22

In direct opposition to Schwier,

the Ninth Circuit in Dittman v. State of California, 191 F.3d 1020 (9th Cir. 1999), refused to
recognize a private right of action where the plaintiff, an acupuncturist, was denied the ability to
renew his license without disclosure of his SSN. Following the theme of licensure, the Southern
District of New York held that a private right of action did not exist where the plaintiff refused to
disclose his SSN in applying for a driver's license. StoianojJ, 107 F. Supp. 2d. at 445. In sum,
this Court notes that while it need not be decided whether a private cause of action exists in this
specific case, such a cause of action may lie in certain circumstances,

depending on the

fundamental nature of the right involved.
CONCLUSION
For the reasons

stated above, Defendants'

Motion to Dismiss

(ECF No. 23)

GRANTED.
A separate Order follows.

/2!?SJ.

Dated: July 3, 2014

'hJ6

Richard D. Bennett
United States District Judge

23

IS