J.N. v. PENN-DELCO SCHOOL DISTRICT

Filing 30

MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE EDUARDO C. ROBRENO ON 01/30/2017. 01/30/2017 ENTERED AND COPIES E-MAILED.(nds)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
J.N., a minor, by his parents and
natural guardians, J.N. and C.N.,
Plaintiff,
v.
PENN-DELCO SCHOOL DISTRICT
Defendant.

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CIVIL ACTION
NO. 14-1618

M E M O R A N D U M
EDUARDO C. ROBRENO, J.

January 30, 2017

This is an action brought under the Individuals with
Disabilities Education Act (“IDEA” or “the Act”), 20 U.S.C.
§§ 1400-1466, on behalf of Plaintiff J.N. (“Plaintiff” or
“J.N.”), a minor diagnosed with severe childhood apraxia of
speech, by his parents, J.N. and C.N. (“the Parents”).

The

Parents allege that J.N.’s school district has failed to provide
a free, appropriate public education for J.N. in accordance with
the requirements of the Act, and they seek reimbursement for
J.N.’s tuition, transportation, and other costs of attendance at
a private school.

The parties have reached a settlement, which

must be approved by the Court pursuant to Local Rule 41.2.
Plaintiff filed a motion for approval of the settlement

agreement, which Defendant does not oppose.

For the reasons

discussed below, the Court will grant Plaintiff’s motion.
I.

FACTUAL BACKGROUND
Plaintiff J.N. is a ten-year-old student who was

diagnosed with severe childhood apraxia of speech.

J.N. and his

parents allege that, for the 2013-14 and 2014-15 school years,
Defendant Penn-Delco School District (“the District”) offered
J.N. Individualized Education Programs (“IEPs”)1 that were
inadequate to meet J.N.’s needs.

Am. Compl. ¶¶ 4-5, ECF No. 14.

Those IEPs placed J.N. in a “Multiple Disabilities Support”
(“MDS”) classroom, which Plaintiff alleges is designed to serve
children who have vastly different needs from those of J.N.
¶¶ 105-15.

Id.

According to Plaintiff, J.N. has significant

difficulties with the motor skills necessary for speech, but he
has “normal intelligence and is highly motivated to
communicate,” distinguishing him from the other children in an
MDS classroom.

Id. ¶¶ 1, 32, 33, 105.

Plaintiff alleges that the Parents worked extensively
with the District to find an appropriate solution for J.N.’s
educational needs without success, and subsequently placed J.N.

1

To provide the requisite free, appropriate public
education, the Act requires states and localities to meet the
educational needs of each handicapped child through the
preparation and implementation of an IEP. See 20 U.S.C.
§ 1414(d).
2

in a private school specializing in his disability, the TALK
Institute (“TALK”).

Id. ¶ 52-60.

After rejecting the

District’s IEP for the 2013-14 school year, the Parents sought
reimbursement from the District for J.N.’s placement at TALK for
that school year.2

Id. ¶¶ 4-5, 115.

The District claimed that

the Parents were not entitled to reimbursement.
A at 2, ECF No. 1-1.

Am. Compl. Ex.

The dispute regarding the District’s

2013-14 IEP for J.N. and the Parents’ request for reimbursement
for that school year proceeded to a hearing before a
Pennsylvania Special Education Hearing Officer.

Id.

After a

nine-session hearing, the Hearing Officer concluded that the
District was able to provide an appropriate educational
placement for J.N., but that it needed “to take steps to
alleviate [the] Parents’ concerns” regarding the adequacy of
speech and language services.

Id.

Having concluded that the

District’s placement was appropriate, the Hearing Officer denied
Plaintiff’s tuition reimbursement claim.

Id.

The Parents subsequently rejected the District’s IEP
for J.N. for the 2014-15 school year, which the Parents allege
is nearly identical to his IEP for the 2013-14 school year, and

2

The Parents previously sought reimbursement from the
District for J.N.’s 2012-13 placement at TALK, which the
District ultimately provided. See Am. Compl. Ex. A at 2, ECF
No. 1-1.
3

kept J.N. in the same private school placement.

Am. Compl.

¶ 183.
II.

PROCEDURAL HISTORY
Plaintiff commenced this action on March 19, 2014,

appealing the Hearing Officer’s decision and bringing claims
under the IDEA, 20 U.S.C. § 1415(i); the Rehabilitation Act, 29
U.S.C. § 794; and the Americans with Disabilities Act, 42 U.S.C.
§ 12131.

ECF No. 1.

16, 2014.

The District answered the complaint on May

ECF No. 3.

Plaintiff filed a motion to amend the

complaint on August 22, 2014, seeking to add claims related to
the District’s IEP for J.N. for the 2014-15 school year.
No. 9.

ECF

The Court granted the motion on November 7, 2014, ECF

No. 13, and Plaintiff filed an amended complaint the same day,
ECF No. 14.

The District answered the amended complaint on

November 25, 2014.

ECF No. 16.

The Court subsequently held a

status and scheduling conference and issued a scheduling order.
ECF No. 18.
Following a settlement conference with Magistrate
Judge Thomas J. Rueter on January 13, 2015, the Court placed the
action in suspense pending the filing of a petition for final
approval of settlement.

ECF No. 22.

On October 31, 2016, the

parties having failed to file a petition for final approval of
settlement, the Court issued a Rule to Show Cause why the action

4

should not be dismissed for lack of prosecution.

ECF No. 23.

The Rule was returnable in writing on or before November 18,
2016.

Id.
Plaintiff filed a Motion for Approval of Settlement

Agreement on November 18, 2016, attaching a draft of the
parties’ settlement (the “Settlement Agreement”).

ECF No. 24.

Plaintiff argues that the settlement is in the best interests of
J.N. and that the attorneys’ fees included in the settlement are
reasonable.

Id.

Plaintiff also filed a response to the Rule to

Show Cause the same day.

ECF No. 25.

The District responded to Plaintiff’s motion on
December 1, 2016.

ECF No. 27.

The District does not object to

the relief sought in Plaintiff’s motion.

The District agrees

that the Settlement Agreement is fair, reasonable, and in the
best interests of J.N., and that it should be approved by the
Court.

Id. at 1.

The District does, however, object to certain

statements in Plaintiff’s motion regarding J.N.’s progress and
the market rate for special education lawyers.

Id.

The Court held a hearing and is now ready to rule on
Plaintiff’s motion.
III. THE TERMS OF THE SETTLEMENT
Under the terms of the Settlement Agreement, the
District agrees to make a direct payment of tuition to a

5

parentally selected and properly accredited private school of
the Parents’ choice for J.N.’s attendance in the amounts of:
(1)

the lesser of $75,000 or the Parents’ tuition
obligation for the 2014-15 school year;

(2)

the lesser of $40,000 or the Parents’ tuition
obligation for the 2015-16 school year; and

(3)

the lesser of $40,000 or the Parents’ tuition
obligation for the 2016-17 school year.

Settlement Agreement and Release §§ 1(a)-(c), ECF No. 24-1.

The

District also agrees to pay reasonable attorneys’ fees in an
amount not to exceed $20,000 to Reisman Carolla Gran LLP.
§ 1(d).

Id.

Thus, the total value of the settlement to Plaintiff is

$175,000, with attorneys’ fees constituting approximately 11.4
percent of the total value.
In exchange, the Parents agree to waive any rights
J.N. or the Parents may otherwise have to any and all education
and discrimination claims through August 31, 2017, under any of
the following statutes and regulations:
the
[IDEA],
20
U.S.C
[§§]
1400-1485
and
its
implementing regulations, 34 C.F.R. Part 300; Section
504 of the Rehabilitation Act of 1973, 20 U.S.C. [§]
794, and its implementing regulations, 34 C.F.R. Part
104; the Americans with Disabilities Act of 1990, 42
U.S.C. [§§] 12101-12213; [§§] 1983 and 1988 of the
Civil Rights Act, 42 U.S.C. [§§] 1983, 1988; the
United States and Pennsylvania Constitutions; 22 Pa.
Code Chapters 14, 15 and 16 of the regulations of the
State Board of Education; the Pennsylvania School Code
of 1949, 24 P.S. 1-101, et seq.; and any other state
6

or federal law which now exists or which may come into
existence, relating to the provision of educational
services to [J.N.].
Id. § 2.

The Parents also agree to make applications for

financial aid for any school funded under the Agreement.
IV.

Id.

LEGAL STANDARD
Local Rule 41.2(a) requires court approval for any

settlement involving a minor.

See Local R. 41.2(a) (providing

that “[n]o claim of a minor . . . shall be compromised, settled,
or dismissed unless approved by the court”).

Court approval is

also required for any “distribution of proceeds out of any fund
obtained for a minor,” and for the payment of counsel fees,
costs or expenses out of any fund obtained for a minor.
R. 41.2(b), (c).

Local

Before approving the settlement of a minor’s

claim, “the court must determine the fairness of any settlement
agreement and the reasonableness of any attorneys’ fees to be
paid from the settlement amount.”

Nice v. Centennial Area Sch.

Dist., 98 F. Supp. 2d 665, 667 (E.D. Pa. 2000) (Robreno, J.).
The determination of the fairness of a settlement
agreement involving a minor and the reasonableness of the
attorneys’ fees “implicates the parties’ substantive rights.”
Id.

Federal law ordinarily controls the adjudication of

substantive rights of the parties when the federal court’s
jurisdiction is predicated upon a federal question.

Id. at 668

(citing Mruz v. Caring, Inc., 39 F. Supp. 2d 495, 504 (D.N.J.
7

1999)).

However, this Court previously held that it was

appropriate to apply state law to determine the fairness of a
minor’s settlement in a federal civil rights action, because
(1) nothing in the federal statutory scheme, 42 U.S.C. §§ 19831988, supplied a rule of decision for the approval of the
settlement; and (2) settlement approval did not implicate a
federal interest or show a need for national uniformity.
668-69.

Id. at

The same is true here: the IDEA does not provide a

framework for evaluating the settlement of a minor’s claim under
the Act, and states have a paramount interest in the well-being
of minors.

Accordingly, the Court will apply Pennsylvania law

to determine whether to approve the Settlement Agreement.
Under Pennsylvania law, in considering whether to
approve a settlement in which a minor is a party in interest,
“[a] [c]ourt is charged with protecting the best interests of
the minor.”

Power v. Tomarchio, 701 A.2d 1371, 1374 (Pa. Super.

Ct. 1997); see also Stecyk v. Bell Helicopter Textron, Inc., 53
F. Supp. 2d 794, 797 (E.D. Pa. 1999) (Robreno, J.) (citing
Wilson v. Bensalem Twp. Sch. Dist., 367 A.2d 397, 398 (Pa.
Commw. Ct. 1976)) (same); Collier v. Dailey, No. 98-3261, 1998
WL 666036, at *1 (E.D. Pa. Sept. 24, 1998) (noting that under
Pennsylvania law, “in reviewing the settlement agreement, the
court must hold that the best interests of the child are
paramount and of controlling importance”).
8

Accordingly, the

Court must consider whether the settlement is “fair, reasonable,
and in the best interests of the minor.”

Nice, 98 F. Supp. 2d

at 670.
After evaluating the fairness of the agreement, a
district court must assess the reasonableness of the requested
counsel fees.

See Loc. R. Civ. P. 41.2(c).

applies here as well.3

Pennsylvania law

In assessing the reasonableness of the

fees, the court must “strike a balance between being a ‘passive
pro forma rubber stamp’ . . . and being too intrusive in its
consideration of the fairness of counsel fees.”

Stecyk, 53 F.

Supp. 2d at 800-01 (quoting Gilmore v. Dondero, 582 A.2d 1106,
1109 (Pa. Super. Ct. 1990)).

Especially where the attorneys’

fees affect the amount ultimately awarded to the minor, “[i]t is
incumbent upon counsel to persuade the court that the attorneys’
fees and costs requested are reasonable and equitable.”

Sosenke

v. Norwood, No. 91-2623, 1993 WL 512824, at *5 (E.D. Pa. Dec. 6,

3

While the IDEA does not provide a framework for
evaluating the settlement of a minor’s claim under the Act, it
does contain provisions governing the amount of attorneys’ fees
a district court may award to a prevailing party, if the court
decides, in its discretion, to award attorneys’ fees as part of
the costs. See 20 U.S.C. § 1415(i)(3). Even if this standard
is appropriate for use in evaluating the reasonableness of
attorneys’ fees included in a settlement agreement, it is not
inconsistent with Pennsylvania law, and therefore Pennsylvania
law is applicable. See 20 U.S.C. § 1415(i)(3)(c) (providing
that fees awarded “shall be based on rates prevailing in the
community in which the action or proceeding arose for the kind
and quality of services furnished” and allowing the court to
reduce the fees under certain circumstances).
9

1993), aff’d, 37 F.3d 1489 (3d Cir. 1994).

Simply because the

minor’s parents have agreed to a contingent fee agreement does
not mean that court approval is warranted.

See id. at *3

(citing Estate of Murray v. Love, 602 A.2d 366, 369-70 (Pa.
Super. Ct. 1992); Gilmore, 582 A.2d at 1110).

Regardless of any

fee agreement, as the protector of the minor’s interests, the
court must independently investigate the fee to be charged to
ensure that it is fair and reasonable.

See Sosenke, 1993 WL

512824, at *3-4.
Under Pennsylvania law, a court should address the
reasonableness of attorneys’ fees to be paid under a settlement
involving a minor through the two-step process articulated by
the Pennsylvania Superior Court in Gilmore, 582 A.2d at 1109-10.
First, the court must consider whether the Court of Common Pleas
with jurisdiction over the minor has adopted a presumptive
lodestar for fees involving the settlement of a minor’s claims.
See id.

Second, if a lodestar exists, the court may adjust that

lodestar depending upon the effectiveness of counsel’s
performance under the circumstances.
V.

See id.

DISCUSSION
A.

Best Interests of the Minor
Based on the parties’ submissions, it appears that the

Settlement Agreement is in J.N.’s best interests.

10

First, Plaintiff’s motion points to the progress J.N.
has made at the private school selected by his parents, the TALK
Institute.

Pl.’s Mot. at 5-6, ECF No. 24.

In this action,

Plaintiff alleges that the IEPs offered by the District would
have placed J.N. in a class for children with multiple
disabilities, most of whom had intellectual disabilities.
According to Plaintiff, J.N. – whose disorder impacts his
expressive language and fine minor skills, but not his
intellectual abilities – would not have made educational
progress in such a classroom.

Am. Compl. ¶¶ 61-77.

In the

years since J.N. began at TALK, Plaintiff claims, J.N. has made
significant progress in his speech and communication abilities,
including developing an increased vocabulary, gaining the
ability to engage in reciprocal communication, and increasing
his daily living skills.

Pl.’s Mot. at 5.

The Settlement Agreement provides for J.N. to continue
his progress at the TALK Institute.

Plaintiff acknowledges that

the Settlement Agreement does not pay all of J.N.’s expenses at
TALK, but still believe that it is in his best interest.
6.

Id. at

Plaintiff’s Amended Complaint sought reimbursement for

J.N.’s private school tuition for the school years 2013-14 and
2014-15.

The Settlement Agreement, however, provides relief for

the 2014-15 school year, as well as two additional years, 201516 and 2016-17.

Settlement Agreement §§ 1(a)-(c).
11

Second, the Settlement Agreement allows J.N. to avoid
the risk of continued litigation.

In this action, Plaintiff has

appealed the decision of an impartial hearing officer who
awarded no reimbursement at all for J.N.’s private school
placement.

If this Court had decided to affirm the hearing

officer’s decision and awarded no reimbursement, Plaintiff avers
that J.N.’s parents would have had great difficulty affording
J.N.’s education at the TALK Institute.4

Pl.’s Mot. at 7.

Finally, Plaintiff notes that under the terms of the
Settlement Agreement, no disbursements are to be made directly
to J.N.’s parents.

Id.

Instead, tuition payments will be made

directly to the private school, and attorneys’ fees will be paid
directly to Plaintiff’s counsel.

Thus, there is no need for

J.N.’s parents to account for how they have handled the
settlement funds.
Defendant agrees with Plaintiff’s assessment that the
Settlement Agreement is in the best interests of J.N., although
the District does not agree with Plaintiff’s characterization of
J.N.’s abilities or of his IEPs.
27.

Def.’s Resp. at 1-2, ECF No.

Defendant emphasizes that J.N.’s IEP and the evaluations

supporting the IEP properly convey J.N.’s abilities and needs,

4

The Court expresses no opinion as to the merits of the

appeal.
12

and that Plaintiff’s statements regarding J.N.’s progress are
unsupported.

Id.

Under these circumstances, the Court concludes that
the Settlement Agreement is fair, reasonable, and in the best
interests of J.N.
B.

Reasonableness of the Attorneys’ Fees
The Settlement Agreement provides for the payment of

$20,000 to Plaintiff’s counsel.

Settlement Agreement § 1(d).

Plaintiff’s counsel has submitted a declaration detailing her
work on this action, see Pl.’s Mot. Ex. D, ECF No. 24-4, as well
as contemporaneous records of the time she spent on the due
process hearing and the instant action, see Pl.’s Mot. Exs. C
& D, ECF Nos. 24-2, 24-3.

According to the declaration and

records, Plaintiff’s counsel spent 249.8 hours on the due
process hearing and 63.1 hours on the instant action, for a
total of 312.9 hours.

Pl.’s Mot. at 9.

To assess the reasonableness of attorneys’ fees for
the settlement of a minor’s claim,5 the Court must first

5

Plaintiff claims that $600-650 per hour is the market
rate for attorneys with over 25 years’ experience in special
education, citing the fee schedule used by Community Legal
Services of Philadelphia (“CLS”) and I.W. v. School District of
Philadelphia, No. 14-3141, 2016 WL 147148, *8 (E.D. Pa. Jan. 13,
2016). Pl.’s Mot. at 9. In response, Defendant contends that
several other courts have rejected the CLS fee schedule and
concluded that $425 or $450 per hour is more appropriate for an
attorney with commensurate experience. See Def.’s Resp. at 2
13

determine whether the relevant Court of Common Pleas has adopted
a presumptive lodestar.

Nice, 98 F. Supp. 2d at 670.

resides in Delaware County.

Plaintiff

Local Rule 2039 of the Court of

Common Pleas of Delaware County provides that, in the case of a
petition to compromise, settle, or discontinue a minor’s action,
“[i]f the proposed distribution includes a claim for counsel
fees in excess of twenty-five (25%) percent of the net (after
expenses incurred by counsel) settlement, evidence shall be
presented as to the nature and extent of the services rendered.”
Delaware Cty. Local R. 2039(b)(1).

Therefore, it appears that

the presumptive lodestar is twenty-five percent.

See Stecyk, 53

F. Supp. 2d. at 801 (adopting Delaware County presumptive
lodestar of twenty-five percent).
Next, the Court must consider whether to adjust the
lodestar based on the effectiveness of counsel’s performance
under the circumstances.

See Gilmore, 582 A.2d at 1109-10.

In

(citing M.W. v. Sch. Dist. of Phila., No. 15-5586, 2016 WL
3959073, at *4 (E.D. Pa. July 22, 2016); Sch. Dist. of Phila. v.
Williams, No. 14-6238, 2016 WL 877841, at *4 (E.D. Pa. Mar. 7,
2016)). In any event, regardless of the parties’ disagreement
over market rates, Plaintiff’s counsel has stated that she
billed for her time in this case at the rate of $390-$400 per
hour, which Defendant agrees is within the market rate. Based
on that rate and the total number of hours Plaintiff’s counsel
expended on this matter, Plaintiff’s counsel claims that under
the lodestar she would be entitled to $121,739.92 in attorneys’
fees. The Court need not decide whether the rate claimed is the
correct rate because, even if it is not, the attorneys’ fee
request in the Settlement Agreement is significantly lower than
the lodestar, even at the claimed reduced rate.
14

order to assess the effectiveness of counsel’s performance, a
court should consider ten factors: (1) the amount of work
performed; (2) the character of the services rendered; (3) the
difficulty of problems involved; (4) the importance of the
litigation; (5)the degree of responsibility incurred;
(6) whether the fund involved was “created” by the attorney;
(7) the professional skill and standing of the attorney in her
profession; (8) the result the attorney was able to obtain;
(9) the ability of the client to pay a reasonable fee for the
services rendered; and (10) “very importantly” the amount of
money in question.

Gilmore, 582 A.2d at 1109 (quoting In re

Trust Estate of LaRocca, 246 A.2d 337, 339 (Pa. 1968)).
Here, the attorneys’ fees included in the Settlement
Agreement are only 11.43 percent of the total settlement, which
is already less than half of the Delaware County lodestar.
Plaintiff’s counsel spent over 300 hours on this matter, and was
able to obtain a positive result for her client.

The Settlement

Agreement grants Plaintiff partial tuition for three years of
private school education, in an action where the administrative
order at issue awarded no relief to Plaintiff at all.
Plaintiff’s counsel’s curriculum vitae, attached as Exhibit E to
Plaintiff’s motion, documents her extensive experience in the
field of special education law.
24-5.

See Pl.’s Mot. Ex. E, ECF No.

On the other hand, the case does not involve novel or
15

complex legal issues, or extensive filings or briefing in this
Court.

On balance, the Court does not believe these factors

warrant adjusting the lodestar to more or less than 11.43
percent, the amount provided in the Settlement Agreement.
Therefore, the Court finds that the attorneys’ fees
provided in the Settlement Agreement are reasonable.
VI.

CONCLUSION
For the reasons stated above, the Court will grant

Plaintiff’s motion for settlement approval and approve the
Settlement Agreement.
An appropriate order follows.

16