744 F.3d 112 (3rd Cir. 2014), 12-4137, M.R. v. Ridley Sch. Dist.

Docket Nº:12-4137
Citation:744 F.3d 112
Opinion Judge:LIPEZ, Circuit Judge:
Party Name:M.R.; J.R., PARENTS OF MINOR CHILD E.R. v. RIDLEY SCHOOL DISTRICT, Appellant
Attorney:John Francis X. Reilly, Esquire (Argued), Media, PA, Counsel for Appellant. Alan L. Yatvin, Esquire (Argued), Popper & Yatvin, Philadelphia, PA, Counsel for Appellees.
Judge Panel:Before: RENDELL, JORDAN and LIPEZ[*], Circuit Judges.
Case Date:February 20, 2014
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit
 
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744 F.3d 112 (3rd Cir. 2014)

M.R.; J.R., PARENTS OF MINOR CHILD E.R.

v.

RIDLEY SCHOOL DISTRICT, Appellant

No. 12-4137

United States Court of Appeals, Third Circuit

February 20, 2014

Argued October 17, 2013.

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[Copyrighted Material Omitted]

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Appeal from the United States District Court for the Eastern District of Pennsylvania. (District Court No. 2-11-cv-02235). District Judge: Honorable Mitchell S. Goldberg.

John Francis X. Reilly, Esquire (Argued), Media, PA, Counsel for Appellant.

Alan L. Yatvin, Esquire (Argued), Popper & Yatvin, Philadelphia, PA, Counsel for Appellees.

Before: RENDELL, JORDAN and LIPEZ[*], Circuit Judges.

OPINION

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LIPEZ, Circuit Judge:

The " stay-put" provision of the Individuals with Disabilities Education Act (" IDEA" ) states that a disabled child shall remain in his or her current educational setting during the pendency of proceedings to resolve a dispute over the child's placement. See 20 U.S.C. § 1415(j). This case requires us to decide two issues of first impression in this Circuit concerning the obligation of school districts to pay for private school education during that interim period: (1) whether parents are eligible for reimbursement for private school costs if they do not file a claim seeking payment until after a court has ruled in favor of the school district, and (2) whether the right to interim funding, if applicable, extends through the time of a judicial appeal.

The district court answered both questions in the affirmative. It thus held that defendant Ridley School District (" Ridley" ) must reimburse the plaintiff parents for the cost of roughly three years of their daughter's private school tuition notwithstanding judicial findings disagreeing with the hearing officer -- rendered before the parents sought payment -- that Ridley had complied with the IDEA by offering the child a free, appropriate education in its own schools.

For the reasons that follow, we affirm the district court's judgment.

I.

This court has previously described in detail the dispute between Ridley and the plaintiffs -- M.R. and J.R. -- over the educational placement of plaintiffs' daughter, E.R. See Ridley Sch. Dist. v. M.R., 680 F.3d 260, 264-67 (3d Cir. 2012) (" Ridley I " ). We briefly review here the factual and procedural background pertinent to the legal issues now before us.

E.R. attended kindergarten and first grade at Grace Park Elementary School in the Ridley School District during the 2006-2007 and 2007-2008 school years, receiving special services to address her learning disabilities and health-related problems. During the summer after first grade, plaintiffs concluded that the public school was not meeting their daughter's needs, and they enrolled her at a private school, Benchmark, that specializes in educating students with learning disabilities. Plaintiffs subsequently filed a complaint with the Pennsylvania Department of Education claiming, inter alia, that Ridley had violated the IDEA and the Rehabilitation Act by failing to provide E.R. with a suitable Individualized Education Program (" IEP" ), thereby denying her the " free appropriate public education" (" FAPE" ) required by those laws.1 See 20 U.S.C. § 1412(a)(1)(A);

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29 U.S.C. § 794.2 Among other remedies, plaintiffs sought reimbursement for the cost of sending E.R. to Benchmark for second grade.3

On April 21, 2009, an administrative hearing officer found that Ridley had committed no violations during E.R.'s kindergarten year, but that E.R. was denied a FAPE for part of first grade and all of second grade. The hearing officer awarded compensatory education for the 2007-2008 school year (when E.R. attended first grade at the public school) and ordered Ridley to reimburse the plaintiffs for the tuition and transportation costs associated with E.R.'s enrollment at Benchmark in 2008-2009.4 Nearly two years later, in February 2011, a federal district court reversed the hearing officer's placement assessment, finding that Ridley's proposed IEP was adequate and, hence, that the school district had offered E.R. a FAPE in the local public school. This court affirmed the district court's ruling on May 17, 2012. See Ridley I, 680 F.3d at 283.

Meanwhile, in March 2011, after filing their appeal from the district court's judgment, plaintiffs sent a letter to the school district requesting payment for E.R.'s Benchmark costs from the date of the hearing officer's decision forward -- at that point, from April 2009 through spring 2011 -- pursuant to the IDEA's stay-put provision. See infra Section II (describing 20 U.S.C. § 1415(j) and related authority). When the school district declined to pay, plaintiffs responded with this action claiming that the IDEA required Ridley to finance E.R.'s private placement until all appeals had concluded in the previous litigation over the adequacy of her IEP.

Ridley denied responsibility for the Benchmark expenses on both procedural and substantive grounds. The school district asserted that the demand for interim tuition was barred at the threshold because it was untimely. This argument relied on three theories: res judicata, the compulsory counterclaim requirement of Federal Rule of Civil Procedure 13, and the statute of limitations. Ridley also contended that plaintiffs were not entitled to relief because, by the time of their second IDEA lawsuit, the district court had already held that Ridley had properly designated the local public school as E.R.'s appropriate placement. The school district argued, in effect, that its validated placement determination had become the baseline for determining the parents' entitlement to a remedy and, accordingly, the IDEA did not provide for recovery of the private school costs.

On cross-motions for judgment on the pleadings, the district court ruled in favor of plaintiffs. The court rejected each of

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Ridley's timeliness contentions and concluded that the IDEA's stay-put provision entitled the parents to reimbursement for the costs they incurred to send E.R. to Benchmark for the entire period they had requested. The costs at issue -- $57,658.38, as stipulated by the parties -- covered the approximately three years from the hearing officer's decision in April 2009 through proceedings in the court of appeals (which had by then concluded with this court's 2012 decision affirming the district court's judgment).

This appeal followed. Ridley again challenges both the timeliness of plaintiffs' reimbursement claim and the legal basis for the award. Our review of the district court's judgment on the pleadings is de novo. See Sheridan v. NGK Metals Corp., 609 F.3d 239, 259 n.25 (3d Cir. 2010).

II.

The premise of the IDEA is that parents and schools working together to design an IEP is the ideal way to reach the statute's goal of a FAPE for every child. See Ridley I, 680 F.3d at 269; see also Schaffer v. Weast, 546 U.S. 49, 53, 126 S.Ct. 528, 163 L.Ed.2d 387 (2005). Congress anticipated, however, that " the collaborative process" may at times break down. Ridley I, 680 F.3d at 269. Hence, the Act allows either party to respond to a stalemate in the discussions by requesting an impartial due process hearing before a state or local administrative officer. See 20 U.S.C. § 1415(f); Sch. Comm. of Town of Burlington v. Dep't of Educ., 471 U.S. 359, 368-69, 105 S.Ct. 1996, 85 L.Ed.2d 385 (1985) (" Burlington " ); Ridley I, 680 F.3d at 269. A variety of disputes may arise concerning placement. For example, the parents may argue for removing the child from public school because they believe the services are inadequate. Or the school district might argue for the same result, over the parents' objection, because it considers the child too disruptive to be in a regular school setting. Alternatively, either party could be advocating for public-school placement -- with the school district insisting that an expensive specialized private school is unnecessary or the parents insisting that participation in a regular classroom is essential for their child's development. See generally Honig v. Doe, 484 U.S. 305, 323-26, 108 S.Ct. 592, 98 L.Ed.2d 686 (1988) (discussing school system's limited authority to exclude disabled students); Burlington, 471 U.S. at 373 (stating that one purpose of the stay-put provision " was to prevent school officials from removing a child from the regular classroom over the parents' objection pending completion of the review proceedings" ); id. at 369-70 (discussing whether parents are entitled to reimbursement for private school tuition); Drinker v. Colonial Sch. Dist., 78 F.3d 859, 861-63 (3d Cir. 1996) (addressing parents' objection to school district's plan to move child from a placement outside the district to a local public school).

The parties have the right to seek state or federal court review of the administrative decision, 20 U.S.C. § 1415(i)(2)(A), and -- under the provision at issue in this case -- the child has the right to remain in his or her " then-current educational placement" during the pendency of the dispute resolution proceedings, id. § 1415(j). Section 1415(j) states, in pertinent part:

[D]uring the pendency of any proceedings conducted pursuant to this section, unless the State or local educational agency and the parents otherwise agree, the child shall remain in the then-current educational placement of the child....5

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This provision, known as the IDEA's " stay-put rule," serves " in essence, as an automatic preliminary injunction," Drinker, 78 F.3d at 864, reflecting Congress's conclusion that a child with a disability is best served by maintaining her educational status quo until the disagreement over her IEP is resolved...

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