Van Orden et al v. Healthlink, Inc. et al
MEMORANDUM AND ORDER : IT IS HEREBY ORDERED that class counsels motion for final approval of the amended proposed settlement is DENIED. (Doc. No. 689 .) IT IS FURTHER ORDERED that within 14 days of the date of this Order, the parties shall file a joint proposed schedule for litigation of the Remedies Phase. Signed by District Judge Audrey G. Fleissig on 11/23/2016. (KCB)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
JOHN VAN ORDEN, et al.,
KEITH SCHAFER, et al.,
Case No. 4:09CV00971 AGF
MEMORANDUM AND ORDER
This matter is before the Court for consideration of the fairness, reasonableness, and
adequacy of a proposed class action settlement under Rule 23(e) of the Federal Rules of
Civil Procedure. The settlement agreement proposes injunctive relief to address alleged
constitutional violations. The case is somewhat unusual because counsel representing the
Plaintiff class have divergent views with respect to the fairness and sufficiency of the
proposed settlement. Further, all of the class representatives and most of the class members
oppose the settlement. The settlement addresses only the remedial phase of the case, as the
Court has already found the statute at issue to be unconstitutional as applied.
The Court finds that the proposed settlement agreement contains provisions directed
at the main violations found by the Court, and confers many benefits, not the least of which
is finality and immediate implementation. Nevertheless, after careful review, the Court
finds that certain deficiencies require denial of the proposed settlement and further court
proceedings with respect to an appropriate remedy.
The approximately 225 Plaintiffs in this class action are civilly committed residents
of the Missouri Department of Mental Health’s (“DMH”) Sex Offender Rehabilitation and
Treatment Services (“SORTS”) facilities, who have been declared sexually violent predators
(“SVPs”) under Missouri’s SVP Act, Mo. Rev. Stat. §§ 632.480-632.525. Plaintiffs filed
suit under 42 U.S.C. § 1983, challenging the constitutionality of the SVP Act as written and
as applied to SORTS. They named as Defendants various executives and employees of
SORTS and the DMH, solely in their official capacities.
At the request of the parties, the case was bifurcated for trial, and the Court held an
eight-day bench trial on the issue of liability only, beginning on April 21, 2015. At the trial,
the Plaintiff class was represented by several attorneys who worked cooperatively and
vigorously represented the class. The Court ultimately concluded that the SVP Act was
unconstitutional as applied to SORTS in three specific respects, 1 each of which contributed
to the civil commitment of individuals beyond the time and scope permissible under the Due
Process Clause. (Doc. No. 501.)
The first constitutional deficiency the Court found was the manner in which
Defendants conducted annual assessments of the mental condition of SORTS residents,
known as “annual reviews.” The evidence at trial showed that annual reviews were the
primary tool that the state courts used to evaluate whether a civilly committed person
continued to satisfy the statutory criteria for commitment. The Court concluded that
SORTS officials responsible for conducting annual reviews were not consistently applying
The Court denied relief on Plaintiffs’ facial challenge to the SVP Act.
the correct legal standard for evaluating residents’ risk level under the statutory criteria.
The Court held that the improper application of the annual review mechanism contributed to
the continued confinement of individuals beyond the time constitutionally justified. Id. at
The second constitutional deficiency the Court found was with respect to treatment
progress and the lack of any community reintegration program. The Court concluded that
residents’ progress through the various treatment phases at SORTS was “tortuously slow,”
that the “lack of clear time frames for such progress . . . contributed to the program’s failure
to release residents,” and that “Defendants’ stated goal of treating and safely reintegrating
individuals back into the community [was] observed in theory but not in practice.” Id. at 54.
The Court held that the result of these deficiencies was “punitive, lifetime detention of
SORTS residents, in violation of the Due Process Clause.” Id. at 55.
The final constitutional deficiency the Court found was that the release procedures at
SORTS were not being performed in the manner required by the SVP Act or the Due
Process Clause. The Court concluded that the Director of the DMH (the “Director”) had
effectively abdicated his statutory duty under Mo. Rev. Stat. § 632.501, which provides that
“[i]f the director of the [DMH] determines that the person’s mental abnormality has so
changed that the person is not likely to commit acts of sexual violence if released, 2 the
As explained in the Court’s opinion on liability, the Missouri Supreme Court has
interpreted similar language in the SVP Act to permit civil commitment only if a person is
“both dangerous and has some mental illness or abnormality,” and to require release if a
resident “can demonstrate that he is no longer likely to commit sexually violent offenses, . . .
regardless of whether the reason he is no longer dangerous is primarily mental or physical.”
In re Care & Treatment of Coffman, 225 S.W.3d 439, 446 (Mo. 2007).
director shall authorize the person to petition the court for release.” 3 The Court held that
the Director had not authorized a single person committed under the SVP Act to petition for
conditional release, and that Defendants were instead stalling or blocking Director
authorization even when SORTS treatment providers and annual reviewers concluded that a
resident qualified for conditional release. The Court held that the Director’s failure to
comply with the SVP Act in this regard contributed to the unconstitutional confinement of
persons who no longer met the criteria for commitment.
The Court held that Plaintiffs’ prayers for injunctive relief with respect to these three
constitutional violations would be addressed in a second phase of trial, the “Remedies
Phase,” initially set for March 30, 2016. However, before trial was held in the Remedies
Phase, the parties jointly moved to stay all proceedings in order to engage in settlement
negotiations. Pursuant to the parties’ joint request and 28 U.S.C. § 636(b), the Court
referred the case to Retired United States Magistrate Judge Mary Ann Medler, who was
approved for recall status, to assist the parties with their efforts to agree to appropriate
On May 4, 2016, the parties filed a joint motion to approve and direct notice to the
class of a proposed settlement. Shortly thereafter, the Court learned that the designated lead
As explained in the Court’s opinion on liability, petitions filed without the Director’s
authorization are subject to heightened requirements, including a frivolity review. See Mo.
Rev. Stat. § 632.504 (“Upon receipt of a first or subsequent petition from committed
persons without the director’s approval, the court shall endeavor whenever possible to
review the petition and determine if the petition is based on frivolous grounds and if so shall
deny the petition without a hearing.”). Moreover, if a petition filed without the Director’s
authorization has been found to be frivolous or has been previously denied, the court must
deny any subsequent petition “unless the petition contains facts upon which a court could
find the condition of the petitioner had so changed that a hearing was warranted.” Id.
class counsel and supporting class counsel (such counsel referred to herein as “class
counsel”) believed the proposed settlement was in the best interest of the class. But John H.
Quinn, one of the attorneys for the class who took a leading role at the trial, and all but one
of the class representatives objected to the proposed settlement.4 After the parties addressed
the propriety of proceeding with a proposed settlement not endorsed by the class
representatives, the Court, on August 5, 2016, approved the parties’ proposed form of notice
and directed notice to the class of the proposed settlement. The Court appointed Mr. Quinn
as counsel to represent the class representatives and any other class members who objected
to the proposed settlement (Mr. Quinn referred to herein as “objectors’ counsel”).
Class counsel, Defendants, and objectors’ counsel thereafter engaged in further
negotiations, which resulted in an amended proposed settlement agreement. (Doc. No. 5911.) Objectors’ counsel continued to oppose the amended proposed settlement on behalf of
the class representatives but joined class counsel and Defendants in a request to approve a
supplemental notice to the class, advising them of the amended proposed settlement. On
September 8, 2016, the Court approved the parties’ proposed supplemental notice and
directed supplemental notice to the class of the amended proposed settlement. All class
members received notice of the original and amended proposed settlements, and a full and
fair opportunity to object to or support the amended proposed settlement.
The matter is now before the Court on the parties’ motion (Doc. No. 689) for final
approval of the amended proposed settlement. Approximately 175 of the 225 of the class
members (more than 75% of the class), including all of the class representatives, have
One of the class representatives initially approved of the proposed settlement, but
that class representative later opposed the proposed settlement.
objected to the amended proposed settlement, largely through objectors’ counsel. One class
member has filed a letter in support of the amended proposed settlement.
The Court held a fairness hearing on October 20, 2016, during which the Court heard
arguments from Defendants and class counsel in support of the amended proposed
settlement and from objectors’ counsel against the amended proposed settlement.5
Based on careful consideration of the amended proposed settlement and objections
thereto; the affidavits, testimony, and other evidence of record; and the arguments of
counsel, the Court regrettably finds that it must deny the joint motion for final approval of
the amended proposed settlement.
A district court may approve a class action settlement only if it is “fair, reasonable,
and adequate.” Fed. R. Civ. P. 23(e)(2). “To make the determination, the district court
must consider four factors: (1) the merits of the plaintiff’s case weighed against the terms of
the settlement, (2) the defendant’s financial condition, (3) the complexity and expense of
further litigation, and (4) the amount of opposition to the settlement.” Marshall v. Nat’l
Football League, 787 F.3d 502, 508 (8th Cir. 2015) (citation omitted). “The single most
important factor in determining whether a settlement is fair, reasonable, and adequate is a
Objectors’ counsel also presented the affidavits of three expert witnesses experienced
in the treatment of sexually violent predators; and the affidavits and live testimony of three
Missouri public defenders in the civil commitment defense unit, responsible for handling
civil commitment cases under the SVP Act. Each of these witnesses offered opinions that,
while the amended proposed settlement provides some remedies to improve the SORTS
program, it does not adequately address the constitutional violations found by this Court.
balancing of the strength of the plaintiff’s case against the terms of the settlement.” Id.
The Court will primarily address the first and fourth factors. The remaining
factors—Defendants’ financial condition and the complexity and expense of further
litigation—are either neutral or do not weigh heavily in favor of approval. Defendants’
financial condition “is not particularly important in [actions that are] not for monetary
damages,” such as this one. See Cody v. Hillard, 88 F. Supp. 2d 1049, 1059 (D.S.D. 2000).
And while it may take time to fashion appropriate injunctive relief and to litigate an appeal,
most discovery is complete and this seven-year-old case is not at such an early stage that
significant time and money would be saved by settlement.
“Because settlement of a class action, like settlement of any litigation, is basically a
bargained exchange between the litigants, the judiciary’s role is properly limited to the
minimum necessary to protect the interests of the class and the public.” Little Rock Sch.
Dist. v. Pulaski Cty. Special Sch. Dist. No. 1, 921 F.2d 1371, 1388 (8th Cir. 1990) (citation
omitted).6 “Although a trial court must consider the terms of a class action settlement to the
extent necessary to protect the interests of the class, judges should not substitute their own
judgment as to optimal settlement terms for the judgment of the litigants and their counsel.”
Petrovic v. Amoco Oil Co., 200 F.3d 1140, 1148-49 (8th Cir. 1999). And although the
district court “may indicate what modifications would make the settlement acceptable to it,
. . . it may not require the parties to submit to these modifications.” Little Rock Sch. Dist.,
Of course, this case is different than the norm, as here, the parties and counsel
charged with representing the interest of the class do not all agree to the proposed
921 F.3d at 1388. Rather, the district court “must consider the proposal as a whole and as
submitted. Approval must then be given or withheld.” Id. (citations omitted).
As an initial matter, the parties are commended for attempting to reach an amicable
resolution. The amended proposed settlement is the result of hard-fought, arms’ length
negotiations carried out with the able assistance of Magistrate Judge Medler. It would
provide the class with the considerable benefits of immediate relief (without the delay of a
trial and appeal), a waiver of Defendants’ right to appeal the Court’s liability findings,
improvement of certain aspects of the SORTS program beyond those the Court found
unconstitutional,7 and the appointment of a Special Master and a Monitor to oversee
Defendants’ compliance with the settlement’s terms and report to the Court for enforcement
But on balance, those benefits are outweighed by a few significant gaps in the
amended proposed settlement, as noted by the objectors, that prevent the proposed
settlement from sufficiently providing a fair, reasonable, and adequate remedy for the
constitutional violations found in this case. Therefore, applying the factors above and
considering the Court’s role under Rule 23(e), “as a fiduciary who must serve as a guardian
of the rights of absent class members,” Grunin v. Int’l House of Pancakes, 513 F.2d 114,
123 (8th Cir. 1975), the Court cannot approve the amended proposed settlement.
The most significant gaps raised by the objectors relate to two of the constitutional
deficiencies found by the Court: treatment progress, as it relates to SORTS’ failure to
For example, the amended proposed settlement limits Defendants’ ability to seek
reimbursement from certain SORTS residents, even though this Court denied Plaintiffs’
claims challenging Defendants’ ability to seek such reimbursement.
release residents; and the Director’s statutory duty to authorize persons to petition for
release if the Director determines that “the person is not likely to commit acts of sexual
violence if released,” Mo. Rev. Stat. § 632.501. These gaps, in combination with a few
other deficiencies noted by the objectors, cause the Court to deny the motion to approve the
amended proposed settlement.
With respect to treatment progress, the amended proposed settlement provides time
frames for expected progress through the various treatment phases at SORTS, and it requires
Defendants to provide notice to SORTS residents if the residents do not progress according
to the expected time frames or if they are moved back a phase in treatment. The notice must
explain the reasons for the residents’ failure to progress or their regression, and must
identify concrete steps the residents must take to progress. The amended proposed
settlement also provides for the appointment of a Special Master and a Monitor with
authority to monitor and report to the Court regarding the number of residents completing
treatment phases within the expected time frames and whether residents are being given the
required notices with respect to treatment progress. These provisions are a very good start
to remedying the constitutional defect the Court found with respect to treatment progress.
However, the amended proposed settlement does not require that residents be treated
under the least restrictive conditions necessary while receiving treatment. Further, the
amended proposed settlement does not provide any clear mechanism for the Special Master,
Monitor, or Court to hold Defendants accountable if they impede residents’ treatment
progress through community reintegration for reasons unrelated to the purpose for their
commitment (namely, their mental condition and dangerousness). Instead, the amended
proposed settlement provides that, if a resident is moved back in treatment, “the reasons for
such action may be challenged by the class member in an appeal to the SORTS Clinical
Director, whose decision is final.” (Doc. No. 591-1 at 7.) In other words, Defendants could
hold residents back in treatment solely as a pretext for warehousing residents in an effort to
avoid releasing anyone—not a wholly implausible proposition, given Defendants’
systematic failure, in the 16 years leading up to the trial in this case, to support the release of
any residents, regardless of whether they met the criteria for continued commitment—and
the Court would have no clear authority under the amended proposed settlement to remedy
Given the importance of this aspect of the remedial phase, the Court is also
concerned with the amended proposed settlement’s restrictions placed on the Special Master
and Monitor. The proposed settlement contains absolute limits of 150 reimbursable hours
per year for the Special Master, and 200 reimbursable hours per year for the Monitor. Such
limits may prove insufficient, especially in the first years of implementation. Moreover, the
duties of the Monitor appear unduly restrictive. At the fairness hearing, the parties
confirmed that the Monitor’s authority was limited to a list of items to be monitored
contained in Exhibit B to the amended proposed settlement. But while Exhibit B authorizes
the Monitor to report on the number of residents completing each treatment phase within the
expected timelines, it does not authorize the Monitor to evaluate whether residents are
moving through each treatment phase as quickly as is appropriate or whether they are
returned to earlier phases for inappropriate reasons. In addition, the amended proposed
settlement requires that “[i]f the Special Master’s report concludes that a substantive
- 10 -
provision is in substantial compliance for two consecutive reports [or one year], the Special
Master shall recommend to the Court that the provision no longer be reported on or
monitored.” Id. at 10. This may not be appropriate and, in any event, may be difficult to
Likewise, with respect to the Director’s duty to authorize persons not likely to
commit acts of sexual violence if released to petition for release, the amended proposed
settlement provides only a partial remedy. The amended proposed settlement imposes a
time frame in which the Director must decide whether to authorize a petition for release (80
days from the date of the request for authorization), and states that if the Director fails to
make a decision within that time, “the State will not request that the [state] court find a
filing by the petitioner to be frivolous pursuant to [Mo. Rev. Stat.] § 632.504.” (Doc. No.
591-1 at 8.) The amended proposed settlement also authorizes the Special Master and
Monitor to monitor and report to the Court regarding whether the Director complies with the
requirement to render decisions within 80 days.
However, the amended proposed settlement does not provide any clear mechanism
for the Special Master, Monitor, or Court to hold the Director accountable if he fails to
comply with the substance of § 632.501. In other words, the Director could refuse to
authorize a person to petition for release without determining that the person still meets the
criteria for civil commitment (a practice this Court has found unconstitutional), and the
Court would have no clear authority under the amended proposed settlement to remedy the
situation. Arguably, the Director could refuse to authorize petitions for release solely as a
pretext to prevent any resident from being released from SORTS.
- 11 -
The Court also questions the adequacy of the amended proposed settlement’s fiveyear termination provision. This appears to be the part of the amended proposed settlement
met with the most vigorous opposition by the objectors. Not all of the objections in this
regard warrant denial of the amended proposed settlement. For example, the objectors
raised a serious concern that the original proposed settlement could have been read to
terminate the Court’s jurisdiction to enforce the settlement automatically after five years,
even if Defendants had taken no steps to comply with the settlement. However, the
amended proposed settlement addresses this issue by plainly providing that if Defendants
have not complied with an order for specific performance, termination will be deferred until
Defendants comply with that order for specific performance.
Additionally, while the objectors were concerned that the amended proposed
settlement does not expressly provide for court-appointed counsel to represent the class
members in enforcing the settlement, that concern is unfounded. At the fairness hearing,
class counsel (consisting of appointed attorneys and those who voluntarily entered their
appearance, such as attorneys from the American Civil Liberties Union of Missouri), stated
that they intended to represent the class through the pendency of the case, including for
purposes of enforcing the settlement, and that the only reason they did not include an
express provision to that effect was that they believed continued legal representation was
presumed unless the Court permitted withdrawal (which none of the attorneys had
requested). Indeed, the amended proposed settlement expressly provides for the Court’s
continued jurisdiction, and references notice to and a continuing role for class counsel in
several places. See, e.g., id. at 10. Finally, the objectors’ concern that Defendants will
- 12 -
revert to their prior patterns immediately upon termination of the settlement does not
warrant an arbitrary or unlimited extension of the settlement’s term. The Court cannot
assume jurisdiction in perpetuity. See In re Pearson, 990 F.2d 653, 658 (1st Cir. 1993) (“In
institutional reform litigation, injunctions should not operate inviolate in perpetuity.”).
Nevertheless, the Court is concerned that the amended proposed settlement’s
termination provision creates an unduly adversarial structure. As drafted, the proposed
settlement encourages requests for specific performance on issues large and small to prevent
termination, as opposed to a reasoned request for termination upon demonstrated substantial
compliance. Unnecessary adversarial relations during the course of implementation of the
remedial phase are not in the interest of justice and can only serve to further hamper trust
between Defendants and the residents, and the development of a proper program focused on
treatment and release.
The extensive opposition to the amended proposed settlement also supports a denial
of the settlement. A settlement can be fair notwithstanding a large number of objectors and
even when all class representatives oppose the settlement. See Marshall, 787 F.3d at 513
(citing Elliott v. Sperry Rand Corp., 680 F.2d 1225, 1226-27 (8th Cir. 1982) (finding no
abuse of discretion in district court’s approval of a class action settlement even though both
named plaintiffs and 790 of approximately 3,000 members objected to it)). Nevertheless,
the number of objectors is a significant consideration, and “at some point objections from
the class may become so numerous that in a very real sense it can be said that ‘the class’ has
not agreed to the proposal, that counsel’s perceptions of the best interests of the class are
faulty, and that approval of the settlement by the district court constitutes an abuse of
- 13 -
discretion.” Pettway v. Am. Cast Iron Pipe Co., 576 F.2d 1157, 1216 (5th Cir. 1978)
(holding that the district court’s approval of a backpay settlement constituted an abuse of
discretion where all active named plaintiffs and 70% of the subclass objected).
Not all of the written objections filed by class members are relevant to this case. See,
e.g., Doc. No. 594 (objecting that the SVP Act discriminates against men on the basis of
sex, which was not a claim in this case). And some of the objections simply do not warrant
denial of the amended proposed settlement, such as the objection raised by many objectors
regarding the limitations on the use of the amended proposed settlement agreement as
evidence in other cases. But the sheer number of objections, and particularly to the extent
that they address the gaps in the amended proposed settlement discussed above, convince
the Court that it should withhold approval and allow the Remedies Phase to proceed to a
For the reasons set forth above,
IT IS HEREBY ORDERED that class counsel’s motion for final approval of the
amended proposed settlement is DENIED. (Doc. No. 689.)
IT IS FURTHER ORDERED that within 14 days of the date of this Order, the
parties shall file a joint proposed schedule for litigation of the Remedies Phase.
AUDREY G. FLEISSIG
UNITED STATES DISTRICT JUDGE
Dated this 23rd day of November, 2016.
- 14 -
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?