590 F.2d 87 (4th Cir. 1978), 77-2224, Trageser v. Libbie Rehabilitation Center, Inc.

Docket Nº:77-2224.
Citation:590 F.2d 87
Party Name:Dec. P 8733, Novella H. TRAGESER, Appellant, v. LIBBIE REHABILITATION CENTER, INC., t/a Libbie Convalescent Home, Appellee.
Case Date:December 18, 1978
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit

Page 87

590 F.2d 87 (4th Cir. 1978)

Dec. P 8733,

Novella H. TRAGESER, Appellant,

v.

LIBBIE REHABILITATION CENTER, INC., t/a Libbie Convalescent

Home, Appellee.

No. 77-2224.

United States Court of Appeals, Fourth Circuit

December 18, 1978

Argued June 7, 1978.

G. Timothy Oksman, Richmond, Va. (Farino & Oksman, Richmond, Va., on brief), for appellant.

Lewis T. Booker, Richmond, Va. (Charles S. McCandlish, Hunton & Williams, Richmond, Va., on brief), for appellee.

United States of America (Drew S. Days, III, Asst. Atty. Gen., Walter W. Barnett and Judith E. Wolf, attys., Dept. of Justice, Washington, D. C., on brief), and National Federation of the Blind (John F. Rick, Richmond, Va., on brief), amici curiae in support of appellant.

Before BUTZNER and HALL, Circuit Judges, and ROBERT F. CHAPMAN, District Judge for the District of South Carolina, sitting by designation.

BUTZNER, Circuit Judge:

Novella H. Trageser appeals the district court's dismissal of her complaint alleging that the termination of her employment at Libbie Rehabilitation Center constituted handicap discrimination in violation of § 504 of the Rehabilitation Act of 1973, the fifth and fourteenth amendments to the Constitution, and 42 U.S.C. § 1983. We affirm because § 120(a) of the Comprehensive Rehabilitation Services Amendments of 1978 forecloses her claim under the Rehabilitation Act of 1973, and lack of governmental action precludes recovery on the other grounds.

I

Libbie, a private corporation, operates a nursing home for profit in Richmond, Virginia.

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It receives substantial income from the state and federal governments in the form of Medicare, Medicaid, Veterans Administration, and welfare payments. The purpose of these payments is to compensate for treatment of specified patients who are entitled to the benefits. The home is subject to inspection by the Virginia Department of Health.

Trageser, a registered nurse, was hired in 1971 and promoted to director of nurses in 1975. Her sight is impaired by a condition known as retinitis pigmentosa, which is hereditary and progressive.

On April 28, 1976, the certification officer from the Virginia Department of Health conducted a regular inspection of the nursing home. The inspector told the administrator of the home that Trageser's eyesight had deteriorated since the last inspection and asked what the home intended to do about it. The administrator relayed these comments to the board of directors. At its meeting on June 7, 1976, the board resolved to dismiss her. Upon learning of this decision, Trageser resigned.

Trageser then brought this action seeking reinstatement, back pay, and an injunction against payment of federal financial assistance to the home unless she was reinstated. The district court treated the termination of her employment as tantamount to discharge, but it granted Libbie's motion to dismiss the complaint for failure to state a claim upon which relief could be granted. See Trageser v. Libbie Rehabilitation Center, 16 E.P.D. P 8117, 17 F.E.P. Cases 398 (E.D.Va.1977).

II

Trageser bases her claim on § 504 of the Rehabilitation Act of 1973 1 which provides as follows:

No otherwise qualified handicapped individual in the United States . . . shall, solely by reason of his handicap, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance.

In § 120(a) of the Comprehensive Rehabilitation Services Amendments of 1978, Congress added, among other provisions, § 505(a)(2) 2 which states:

The remedies, procedures, and rights set forth in title VI of the Civil Rights Act of 1964 shall be available to any person aggrieved by any act or failure to act by any recipient of Federal assistance or Federal provider of such assistance under § 504 of this Act.

Title VI contains the prototype of § 504 of the Rehabilitation Act. See Lloyd v. Regional Transportation Authority, 548 F.2d 1277, 1280 and n.9 (7th Cir. 1977). Section 601 of Title VI 3 provides as follows:

No person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance.

The broad prohibition of § 601 is, however, qualified by § 604, 4 which creates the following limitation:

Nothing contained in this subchapter shall be construed to authorize action under this subchapter by any department or agency with respect to any employment practice of any employer, employment agency, or labor organization except where a primary objective of the Federal financial assistance is to provide employment. 5

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Although § 604 expressly curtails the authority of federal departments and agencies, it also restricts private suits. Thus, because of § 604, Title VI does not provide a judicial remedy for employment discrimination by institutions receiving federal funds unless (1) providing employment is a primary objective of the federal aid, 6 or (2) discrimination in employment necessarily causes discrimination against the primary beneficiaries of the federal aid. 7

Title VII of the Civil Rights Act of 1964 8 provides the primary statutory remedies for racial and ethnic discrimination in employment. Recognizing this, Congress supplemented the Rehabilitation Act by including in § 120(a) of the 1978 amendments a new subsection 505(a)(1) 9 which makes the pertinent remedies, procedures, and rights of Title VII available to federal employees who complain of handicap discrimination in employment in violation of § 501 of the Rehabilitation Act. 10 Congress also could have utilized Title VII to define the rights and remedies of a person in Trageser's position who must rely on § 504. Instead, for employees of private institutions receiving federal financial aid, § 120(a) of the 1978 amendments makes available only the remedies, procedures, and rights of Title VI, which, as we have noted above, contains the restriction of § 604. The distinction that § 120(a) draws between the relief available to federal employees and that available to employees of private institutions receiving federal assistance could not have been inadvertent....

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