591 F.3d 417 (5th Cir. 2009), 08-50830, El Paso Independent School Dist. v. Richard R.

Docket Nº:08-50830.
Citation:591 F.3d 417
Opinion Judge:KING, Circuit Judge:
Party Name:EL PASO INDEPENDENT SCHOOL DISTRICT, Plaintiff-Appellant, v. RICHARD R., as next friend of R.R.; Mark Berry, Defendants-Appellees. R.R., by his next friend E.R., Plaintiff-Appellee, v. El Paso Independent School District, Defendant-Appellant.
Attorney:Todd Aaron Clark, Walsh, Anderson, Brown, Aldridge & Gallegos, P.C., Austin, TX, Elena M. Gallegos, Walsh, Anderson, Brown, Schulze & Aldridge, Albuquerque, NM, Joe Ruben Tanguma, II (argued), Walsh, Anderson, Brown, Aldridge & Gallegos, P.C., Irving, TX, for Plaintiff-Appellant. Charles Mark Ber...
Judge Panel:Before KING, DAVIS and BENAVIDES, Circuit Judges.
Case Date:December 16, 2009
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit
 
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Page 417

591 F.3d 417 (5th Cir. 2009)

EL PASO INDEPENDENT SCHOOL DISTRICT, Plaintiff-Appellant,

v.

RICHARD R., as next friend of R.R.; Mark Berry, Defendants-Appellees.

R.R., by his next friend E.R., Plaintiff-Appellee,

v.

El Paso Independent School District, Defendant-Appellant.

No. 08-50830.

United States Court of Appeals, Fifth Circuit.

December 16, 2009

Page 418

[Copyrighted Material Omitted]

Page 419

Todd Aaron Clark, Walsh, Anderson, Brown, Aldridge & Gallegos, P.C., Austin, TX, Elena M. Gallegos, Walsh, Anderson, Brown, Schulze & Aldridge, Albuquerque, NM, Joe Ruben Tanguma, II (argued), Walsh, Anderson, Brown, Aldridge & Gallegos, P.C., Irving, TX, for Plaintiff-Appellant.

Charles Mark Berry (argued), El Paso, TX, for RR and Richard R.

Coilbert N. Coldwell, Guevara, Rebe, Bauman, Coldwell & Reedman, El Paso, TX, for Berry.

Christopher Paul Borreca, Thompson & Horton, L.L.P., Houston, TX, for Amici Curiae.

Appeal from the United States District Court for the Western District of Texas.

Before KING, DAVIS and BENAVIDES, Circuit Judges.

KING, Circuit Judge:

The El Paso Independent School District appeals the district court's award of attorney's fees to R.R. under the Individuals with Disabilities Education Act. The district court determined that R.R. was the prevailing party in his suit against the school district because he had won a judicial order granting him his requested relief; the court awarded attorney's fees to R.R. in the amount of $45,804. We assume, without deciding, that R.R. was the prevailing party in this litigation. But because R.R. rejected a written settlement offer that included all the educational relief that he requested and reasonable attorney's fees, we also conclude that R.R. unreasonably protracted the resolution of this dispute and VACATE the award of attorney's fees to R.R. We AFFIRM the dismissal of EPISD's claim for attorney's fees.

I. FACTUAL AND PROCEDURAL BACKGROUND

R.R.1 claims to suffer from Attention Deficit/Hyperactivity Disorder. Over the past twelve years, R.R. has sought special

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education and accommodative services from the El Paso Independent School District (EPISD) under the Individuals with Disabilities Education Act (IDEA), 20 U.S.C. § 1400 et seq. R.R. has been evaluated several times for special education services, admitted to special education programs, and assisted in his education through the provision of accommodative services.

In 2005, R.R. was struggling in school, despite receiving accommodative services that included test preparation and study skills assistance. Later that year, after failing the Texas standardized skills assessment test for the third consecutive year, R.R. requested an evaluation for special education services. In response to this request, the school district set up a committee to evaluate R.R.'s academic placement. The committee determined that because R.R. was very close to passing the Texas standardized skills test, there was no need to either evaluate him for special education or change his current academic placement and accommodative services.

In 2006, after R.R. again failed the Texas standardized test, R.R. requested a full evaluation to determine his eligibility for special education services. In response, EPISD scheduled a meeting for September 25, 2006, to address R.R.'s request. On September 25, R.R. cancelled the scheduled meeting and, on September 26, filed a request for a state due process hearing. In that filing, R.R. sought an order from the Texas Education Agency Hearing Officer directing EPISD to (1) perform a " full independent evaluation" of R.R.; (2) provide written notice to R.R.'s parents whenever the district proposed to change R.R.'s status, accommodations, or evaluation report; (3) provide notice of procedural safeguards to R.R.'s parents; (4) conduct an Admissions, Review, and Dismissal Committee (ARDC) meeting; and (5) pay reasonable attorney's fees.

At the required pre-hearing resolution meeting,2 held on October 11, 2006, EPISD contended that there was no dispute between the parties because it was willing to provide all requested relief. Specifically, EPISD offered to (1) conduct a full evaluation of R.R. within sixty days of the parents' consent to evaluate; (2) convene an ARDC meeting within thirty days from the completion of the evaluation; (3) continue to comply with the applicable federal and state laws regarding the provision of prior written notice and procedural safeguards to parents; and (4) pay attorney's fees. At the meeting, EPISD asked for a quantification of R.R.'s attorney's fees. R.R. did not quantify his attorney's fees demand and instead asked for an " agreed order." EPISD demurred, contending that an " agreed order" was not appropriate because there were factual and legal disputes between the parties. R.R. then left the meeting.

Later that day, EPISD formalized the offer made at the resolution meeting in a written settlement offer faxed to R.R. The faxed letter included everything offered at the resolution meeting and initially suggested an attorney's fee award of $3,000. However, EPISD stated that it " remain[ed] ready to negotiate a private settlement, and in so doing, ... [requested] the amount of attorney's fees that w[ould] be necessary to finalize the settlement." Rather than continue negotiating, R.R. refused EPISD's settlement offer, did not make a counter-offer, and proceeded to a due process hearing.

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At the due process hearing in November 2006, EPISD reasserted that there was no dispute between the parties because it was willing to grant all requested relief to R.R. As such, EPISD argued that R.R.'s complaint should be dismissed. Notwithstanding this argument, the state hearing officer conducted a two-day hearing on the issues presented in R.R.'s due process complaint. After the hearing, the hearing officer made factual findings and entered judgment in favor of R.R., ordering EPISD to conduct a full evaluation of R.R.

In April 2007, EPISD and R.R. each filed suit in district court under the IDEA . In its suit, EPISD argued that the hearing officer's refusal to dismiss R.R.'s complaint was error because the complaint was non-justiciable. As a result, EPISD urged, R.R.'s subsequent litigation was frivolous, and the court should award EPISD attorney's fees. R.R. also sought an award of attorney's fees, asserting in his complaint that, based on the state hearing officer's ruling, he was the prevailing party. The two suits were subsequently consolidated.

R.R. moved for summary judgment on the prevailing party issue in July 2007. The district court held that R.R. was justified in rejecting EPISD's settlement offer and continuing his litigation to obtain an " enforceable order." As part of this holding, the district court determined that there was a justiciable dispute before the Texas hearing officer because EPISD had not offered an enforceable settlement. Specifically, the district court concluded that EPISD's settlement offer would not have been enforceable in either state or federal court, and as such, R.R. had an interest in continuing litigation to obtain a judicial order that could be enforced against EPISD. The district court then held that R.R. had prevailed in the litigation by obtaining a judicial order entitling him to all of his requested relief. Because the district court determined that R.R.'s litigation was not frivolous, the court also dismissed EPISD's attorney's fee claim.

Following this prevailing party determination, R.R. moved for attorney's fees. In response, EPISD again argued that because R.R. had achieved nothing more than was originally offered, the district court should not award attorney's fees to R.R. The district court disregarded EPISD's contentions, stating that it had considered those arguments in making its prevailing party determination. Instead, the district court granted R.R.'s motion for attorney's fees in August 2008 and awarded $45,804 in fees to R.R.-an award that reflected the full amount of work R.R.'s attorney had done. EPISD now appeals the district court's prevailing party and attorney's fee decisions.

II. DISCUSSION

The IDEA requires that a party be a " prevailing party" in order to be entitled to attorney's fees. See 20 U.S.C. § 1415(i)(3)(B)(i) (" [T]he court, in its discretion, may award reasonable attorneys' fees ... to a prevailing party ...." ). Thus, in an action for attorney's fees under the IDEA, the threshold question is whether the party seeking attorney's fees is the prevailing party. See Jason D.W. ex rel. Douglas W. v. Houston Indep. Sch. Dist., 158 F.3d 205, 209 (5th Cir.1998) (per curiam). However, " [a] finding that a party is a prevailing party only makes him eligible to receive attorneys' fees under the IDEA; it does not automatically entitle him to recover the full amount that he spent on legal representation." Id.

A. Prevailing Party Status

Under the IDEA, " a prevailing party is one that attains a remedy that both (1) alters the legal relationship between the school district and the handicapped child and (2) fosters the purposes

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of the IDEA." Jason D.W., 158 F.3d at 209. This test follows from Texas State Teachers Association v. Garland Independent School District , where the Court held that the " touchstone of the prevailing party inquiry must be the material alteration of the legal relationship of the parties in a manner which Congress sought to promote in the fee statute." 489 U.S. 782, 792-93, 109 S.Ct. 1486, 103 L.Ed.2d 866 (1989); see also Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983) (" [P]laintiffs may be considered ‘ prevailing parties' ... if they succeed on any significant issue in litigation which achieves some of the benefit the parties sought in bringing suit." ).

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