15,844 WELFARE RECIPIENTS v. King

• Decision Date: 23 August 1979
• Docket Number: Civ. A. No. 79-643-G.
• Parties: 15,844 WELFARE RECIPIENTS, including but not limited to Naomi Allen, Judith Cope, Pat Cotter, Anne Doe, Jane Doe, Jane Doe II, Rose Doe, Migdalia Gonzalez, Louise Guenard, Amanda Jones, Shirley Lane, Melvena Lawson, Lorraine Murray, Sue-Ann Ochs, Judith Periera, Marilyn Pollitt, Kathleen Rocci, Nancy Ramos, Shirley Roxas, Pauline Sayers, Paul D. Smith, May L. Stanikmas, Catherine Trites, Lynn Walker, Richard Woodrum, and Catena Zagarella on behalf of themselves and their minor children and all others similarly situated, Plaintiffs, v. Edward J. KING, Individually and in his capacity as Governor of the Commonwealth of Massachusetts, Charles H. Mahoney, Individually and in his capacity as Secretary of the Office of Human Services, Edward T. Hanley, Individually and in his capacity as Secretary of the Executive Office of Administration and Finance, John Pratt, Individually and in his capacity as Commissioner of Public Welfare, and James F. Scanlan, Individually and in his capacity as Director of the Bureau of Welfare Auditing, Defendants.
• Court: U.S. District Court — District of Massachusetts

474 F. Supp. 1374

15,844 WELFARE RECIPIENTS, including but not limited to Naomi Allen, Judith Cope, Pat Cotter, Anne Doe, Jane Doe, Jane Doe II, Rose Doe, Migdalia Gonzalez, Louise Guenard, Amanda Jones, Shirley Lane, Melvena Lawson, Lorraine Murray, Sue-Ann Ochs, Judith Periera, Marilyn Pollitt, Kathleen Rocci, Nancy Ramos, Shirley Roxas, Pauline Sayers, Paul D. Smith, May L. Stanikmas, Catherine Trites, Lynn Walker, Richard Woodrum, and Catena Zagarella on behalf of themselves and their minor children and all others similarly situated, Plaintiffs, v. Edward J. KING, Individually and in his capacity as Governor of the Commonwealth of Massachusetts, Charles H. Mahoney, Individually and in his capacity as Secretary of the Office of Human Services, Edward T. Hanley, Individually and in his capacity as Secretary of the Executive Office of Administration and Finance, John Pratt, Individually and in his capacity as Commissioner of Public Welfare, and James F. Scanlan, Individually and in his capacity as Director of the Bureau of Welfare Auditing, Defendants.

Civ. A. No. 79-643-G.

United States District Court, D. Massachusetts.

August 23, 1979.

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Allan G. Rodgers, Mass. Law Reform Institute, Boston, Mass., Barbara Sard, Greater Boston Legal Service, Roxbury, Mass., for plaintiffs.

S. Stephen Rosenfeld, Betty E. Waxman, Asst. Attys. Gen., Boston, Mass., for defendants.

MEMORANDUM OF DECISION

GARRITY, District Judge.

Plaintiffs brought this action for declaratory and injunctive relief from an allegedly unlawful welfare fraud investigation commenced by the defendants on the basis of a computer match. On April 3, 1979, after a hearing, we granted plaintiffs' Motion for a Temporary Restraining Order and entered a written order dated April 5, 1979, which we modified on April 6, 1979. On June 11, 1979 we granted plaintiffs' Motion for a Further Temporary Restraining Order in one limited respect only, namely, by directing the defendants to return certain information obtained from welfare recipients in connection with the March 19, 1979 notice and related interviewing process. We denied plaintiffs' Motion for Clarification on June 22, 1979, and on July 3, 1979, we granted one aspect of plaintiffs' June 22, 1979 Motion for Reconsideration and for Further Temporary Relief.

Plaintiffs now seek a preliminary injunction enjoining the defendants from proceeding to redetermine the continuing eligibility of plaintiffs for AFDC benefits based on the 1977 computer match, or, in the alternative, enjoining defendants from redetermining plaintiffs, except upon certain stated conditions. The preliminary injunction would also enjoin defendants from referring any of the plaintiffs to other Bureau of Welfare Auditing, from interviewing or investigating any of the plaintiffs for alleged fraud based on the 1977 computer match and from initiating any recoupment action, except upon certain stated conditions. In view of the extensive briefs filed by both parties and the numerous supporting and opposing affidavits, we conclude that a further hearing would not assist us in resolving the issues. We grant plaintiffs' motion for a preliminary injunction by continuing in effect our April 3, 1979 Temporary Restraining Order dated April 5, 1979, as supplemented in our June 11, 1979 Supplemental Restraining Order and as modified by our July 3, 1979 order, as a preliminary injunction, hereto attached as Appendix A. Insofar as plaintiffs' motion requests preliminary relief not contained in the aforementioned orders of this court, that relief is denied.

Jurisdiction

Although defendants have not challenged our jurisdiction, we should address the issue sua sponte, especially in view of Chapman v. Houston Welfare Rights Org., ___ U.S. ____, 99 S.Ct. 1905, 60 L.Ed.2d 508, decided by the United States Supreme Court on May 4, 1979. Plaintiffs predicate federal jurisdiction on 28 U.S.C. §§ 1343(3) and 1343(4) and jurisdiction over the state law claims as pendent to the federal claims. The Court in Chapman concluded that neither § 1343(3) nor § 1343(4) confers jurisdiction to entertain a claim that state action violates the Social Security Act.

However, plaintiffs' complaint alleges a deprivation under color of state law of constitutional rights, viz., rights under the First, Fourth, Fifth and Fourteenth Amendments. Because at least the Fifth and Fourteenth Amendment claims are not patently without merit, plainly frivolous, or clearly foreclosed by prior decisions, we have pendent jurisdiction to decide the claims based on the Social Security Act and federal regulations. Hagans v. Lavine, 1973, 415 U.S. 528, 536, 537, 94 S.Ct. 1372, 39 L.Ed.2d 577. Moreover, since both state law and federal law claims derive from a common nucleus of operative fact, we may, and we do, exercise pendent jurisdiction over the state claims. United Mine Workers v. Gibbs, 1966, 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218. We need not, therefore, determine whether plaintiffs individually meet the amount in controversy requirement of 28 U.S.C. § 1331 and thus whether § 1331 offers an independent jurisdictional base to decide the Social Security Act claims.

Findings of Fact

Our statement of the facts dictated at the April 3, 1979 hearing will serve as the findings of fact required by Fed.R.Civ.P., Rule 52, up to the date of that hearing. In addition we find the following:

1. On or about April 17, 1979, after issuance of our April 3, 1979 Temporary Restraining Order, the Department of Public Welfare sent Memorandum AP-79-27 to Assistance Payments Staff informing all staff of the substance of our Order and setting forth procedures to be followed to restore cases to the status quo ante existing prior to the March 19, 1979 notice and related interviewing process. A copy of AP-79-27 is attached to Defendants' Memorandum of Law in Opposition to Plaintiffs' Motion for Preliminary Injunction as exhibit "D".

2. On May 8, 1979, pursuant to our April 3, 1979 Temporary Restraining Order, ¶ 1.b, defendants mailed to each plaintiff a notice intended to undo the effect of the March 19, 1979 notice and interviewing process. A copy of the May 8 "curative" notice is attached to Defendants' Memorandum of Law as exhibit "A".

3. About May 17, 1979, defendants conducted a review of each plaintiff's file in order to determine which plaintiffs would be subject to priority redeterminations and/or fraud referrals. The procedures and standards followed in this "desk review" are contained in AP-79-33 to Assistance Payments Staff attached to Defendants' Memorandum as exhibit "B". This desk review resulted in reducing the total number of recipients subject to redetermination and possible fraud referral to about 6,000.

4. About June 14, 1979 the Department of Public Welfare issued to its Assistance Payments Staff Memorandum AP-79-43 outlining the procedures to be followed in determining the group of about 6,000 recipients who remained after the desk review and in referring members of this group for fraud investigations. A copy of AP-79-43 is attached to Defendants' Memorandum of Law as exhibit "C".

5. Also about June 14, 1979 new redetermination interview notices were mailed to those recipients designated by the AP-79-43 memorandum. A copy of the redetermination interview notice is included with memorandum AP-79-43 as Attachment 1 in exhibit "C" to Defendants' Memorandum of Law.

6. The Bureau of Welfare Auditing informed all supervisors by memo dated July 10, 1979 that the Department of Public Welfare would remove all information from DPW case files obtained from client contact related to the computer match. Moreover, by Memorandum AP/ADM-79-28 dated July 16, 1979, the Department of Public Welfare directed all Associate Regional Managers for Assistance Payments, RDCU Managers, CSAO/WSO Directors, and Assistant Directors for Assistance Payments to remove temporarily from a case file any information obtained as a result of client contact related to the Earnings Match before BWA investigators review the file. The BWA Memo is attached to Defendants' Memorandum of Law as exhibit "I" and AP/ADM-79-28 is attached as exhibit "H".

7. In response to our July 3, 1979 Order modifying our April, 3, 1979 Temporary Restraining Order, defendants have drafted new Bureau of Welfare auditing notices of fraud investigation interviews specifying that "your lack of cooperation with this investigation will not effect sic your current eligibility for assistance." A copy of this notice is attached to Defendants' Memorandum of Law as exhibit "K".

8. Defendants' efforts to separate DPW and BWA activities and records and the very limited scope of examination in DPW interviews demonstrate their good faith in isolating eligibility redeterminations from fraud investigations.

Conclusions of Law

Our conclusions of law include those dictated at the April 13, 1979 hearing and those contained in subsequent orders of this court. Plaintiffs raise a number of additional arguments in support of their request for preliminary relief, the most important of which we address below. The following discussion divides the arguments into two categories, those challenging the conduct of eligibility redeterminations and those challenging the fraud investigations.

DPW Eligibility Redeterminations

Plaintiffs continue to insist that, in spite of the substantial modifications that defendants have made in their procedures and the mailing of the May 8, 1979 "curative" notice, defendants are still conducting fraud investigations under the guise of eligibility redeterminations. We do not agree. Contrary to plaintiffs' claim at page 3 of their Reply Memorandum in support of Motion for Preliminary Injunction, the eligibility redeterminations plainly serve a purpose different from that served by fraud investigations. The...