J. B-K. v. Sec'y of Ky. Cabinet for Health & Family Servs.

• Decision Date: 16 September 2022
• Docket Number: 21-5074
• Parties: J. B-K., minor child 1, BY Next Friend E.B., et al., Plaintiffs-Appellants, v. SECRETARY OF KENTUCKY CABINET FOR HEALTH AND FAMILY SERVICES; Commissioner of Kentucky Department for Community Based Services; Elizabeth Caywood, in her official capacity as Deputy Commissioner of the Kentucky Department for Community Based Services, Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

48 F.4th 721

J. B-K., minor child 1, BY Next Friend E.B., et al., Plaintiffs-Appellants,

v.SECRETARY OF KENTUCKY CABINET FOR HEALTH AND FAMILY SERVICES; Commissioner of Kentucky Department for Community Based Services; Elizabeth Caywood, in her official capacity as Deputy Commissioner of the Kentucky Department for Community Based Services, Defendants-Appellees.

No. 21-5074

United States Court of Appeals, Sixth Circuit.

Argued: October 21, 2021

Decided and Filed: September 16, 2022

ARGUED: Douglas L. McSwain, WYATT, TARRANT & COMBS, LLP, Lexington, Kentucky, for Appellants. David Brent Irvin, KENTUCKY CABINET FOR HEALTH & FAMILY SERVICES, Frankfort, Kentucky, for Appellees. ON BRIEF: Douglas L. McSwain, Thomas E. Travis, WYATT, TARRANT & COMBS, LLP, Lexington, Kentucky, Richard Frank Dawahare, Lexington, Kentucky, for Appellants. David Brent Irvin, Leeanne Applegate, KENTUCKY CABINET FOR HEALTH & FAMILY SERVICES, Frankfort, Kentucky, for Appellees. Catherine M. Padhi, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Amicus Curiae.

Before: McKEAGUE, NALBANDIAN, and MURPHY, Circuit Judges.

NALBANDIAN, J., delivered the opinion of the court in which McKEAGUE, J., joined. MURPHY, J. (pp. 730-37), delivered a separate opinion concurring in the judgment.

NALBANDIAN, Circuit Judge.

A group of foster caregivers sued the Kentucky Cabinet for Health and Family Services for denying foster care maintenance payments to children in the caregivers’ care. On appeal, we must decide whether the district court properly construed Title IV-E of the Social Security Act in holding that these children were not eligible for foster care maintenance payments. Because the Cabinet does not have placement and care responsibility over children placed into custody of a relative or fictive kin by a court order, we affirm the district court.

I.

A. Statutory Background

Congress passed the Adoption Assistance and Child Welfare Act of 1980 ("the CWA") to, among other things, provide states with reimbursements for expenses associated with foster care and adoption programs.¹ The CWA created the Title IV-E program of the Social Security Act, which sets conditions for states to receive reimbursements for foster care maintenance payments ("FCMPs") made on behalf of eligible children. 42 U.S.C. §§ 670 – 676. Some of Title IV-E's conditions for participating states include having a state plan approved by the Secretary of the Department of Health and Human Services ("HHS"), having a designated state agency responsible for administering the state plan, and providing FCMPs to eligible children. See id. §§ 670 – 672. If a state's program fails to "substantial[ly] conform[ ]" to the CWA's requirements, the Secretary allows the state an opportunity to implement a corrective plan and, if the state still fails to conform, withholds federal funding. Id. §§ 1320a-2a(a), (b)(3)-(4).

Following a judicial determination that continuation in the home would be contrary to the child's welfare, states provide FCMPs to children removed from their homes and placed in the temporary care of a foster family home. Id. § 672(a). But not all children removed from their homes are eligible under Title IV-E. Relevant here, to be eligible for FCMPs, the removed child's "placement and care" must be the "responsibility of ... the State agency administering the State plan approved [by the HHS Secretary]." Id. § 672(a)(2)(B). After states provide FCMPs, they may seek partial reimbursements from the federal government.

Kentucky receives Title IV-E funds and has a state plan approved by the HHS Secretary. The Kentucky Cabinet for Health and Family Services ("Cabinet") administers the Commonwealth's state plan for foster care and adoption assistance as Kentucky's designated Title IV-E agency. The Cabinet operates the Department for Community Based Services ("DCBS"), a sub-agency that helps the Cabinet administer the state plan. Kentucky enacts statutes and regulations to implement the program. See Ky. Rev. Stat. Ann. § 620.010 et seq. Kentucky also claims reimbursements under Title IV-E for FCMPs made to eligible recipients.

Kentucky law governs Kentucky's foster care system. See D.O. v. Glisson , 847 F.3d 374, 381 (6th Cir. 2017). The process for removing a child from the home has several potential outcomes. To start, any interested person can initiate a dependency, neglect, or abuse ("DNA") action in state court. See Ky. Rev. Stat. Ann. § 620.070(1). Following a DNA proceeding, a court generally has four options for placing a child. Two of the options order the child to remain at home but set in place informal adjustment agreements or protective orders. Id. § 620.140(1)(a)-(b). A court order may also remove the child "to the custody of an adult relative, fictive kin," or other person or facility. Id. § 620.140(1)(c). And finally, a court can commit the child to the custody of the Cabinet. See id. § 620.140(1)(d). These latter two outcomes—when a court orders a child removed from the home—are the source of the disagreement here.

The Cabinet argues that only the last outcome, when a court commits a child to the custody of the Cabinet, "creates a real foster care relationship with a child and the Cabinet." So the Cabinet does not provide FCMPs to children placed by courts into the care of a relative or fictive kin.² The Plaintiffs contend that placing a child in the care of a relative or fictive kin is the preferred outcome for the child, but that the Cabinet's position places those caregivers in an unjustified, disadvantageous position compared to non-relative caregivers who receive FCMPs.

B. Procedural History

The Plaintiff caregivers brought a class action on behalf of themselves, the foster children, and members of four classes against the Cabinet and the DCBS. The Plaintiffs accused the Cabinet of systematically denying FCMPs to eligible children without notice or a fair hearing, and doing so in a way that discriminated against relative caregivers. The Plaintiffs sought injunctive and declaratory relief. For its part, the Cabinet opposed the injunction and moved for both dismissal and summary judgment.

To begin with, the district court certified four classes: (1) a Children's Class, (2) a Caregivers’ Class, (3) a Cabinet Custody Class, and (4) a Notice and Hearing Class.³ Next, the district court considered the parties’ dueling dispositive motions. When the dust settled, the district court denied the Cabinet's motion to dismiss; denied the Plaintiffs’ preliminary injunction; and granted the Cabinet's summary judgment in part, except as to the Cabinet Custody Class. See J.B.-K.-1 v. Sec'y of Ky. Cabinet for Health & Fam. Servs. , 462 F. Supp. 3d 724 (E.D. Ky. 2020). Relevant here, the district court held that under Kentucky law, the Cabinet did not have placement and care responsibility over children not in their custody because the Cabinet had no ability to change a child's placement without a court order. Id. at 735–36. So only members of the Cabinet Custody Class were eligible for FCMPs, assuming they met the other § 672(a) requirements. Id. at 736.

Representatives for the three losing classes appealed, and the Cabinet did not cross-appeal the judgment as to the Cabinet Custody Class. We heard arguments from both parties but had lingering questions for HHS, which is not a party in this case. After all, the elephant in the room is whether HHS will reimburse Kentucky for FCMPs if we rule in the Plaintiffs’ favor—or if Kentucky would be left holding the bag. So we asked HHS Secretary Xavier Becerra for his position. And we also asked him to reconcile some regulatory language and HHS guidance that, in our view, offered conflicting views on the question.

HHS contended that "the Cabinet does not have placement and care responsibility for children removed from their homes and placed by court order into the custody of a relative or fictive kin." (Brief for the United States as Amicus Curiae, J.B-K., et al. v. Sec'y of Ky. Cabinet for Health & Fam. Servs. , No. 21-5074, at 6 (6th Cir. 2022).) As support, HHS looked to Kentucky law and determined that, although the Cabinet performed some services for the children, "it did not assume legal responsibility for the children's day-to-day care, and it had no authority to change their placements." (Id. at 8.) HHS then offered a second reason why members of the Children's Class were ineligible for FCMPs: Title IV-E requires children to be placed in a statutorily defined "foster family home," and these children were not. (See id. at 9 (citing 42 U.S.C. § 672(a)(2)(C) ).)

In response, the Plaintiffs argued that HHS, like the district court, misinterpreted § 672(a)(2)(B) by looking to Kentucky law. They also argued that the "foster family home" point was irrelevant to the appeal, as the Cabinet never made the argument. The Cabinet didn't respond to either HHS's or the Plaintiffs’ brief.

II.

First, we have a threshold issue to address. In its briefing, the Cabinet urges us to revisit our decision in Glisson . In that case, we found that the CWA confers an individually enforceable right to FCMPs. See Glisson , 847 F.3d at 380. As it stands, we are with the majority in the private-right-of-action circuit split. Compare N.Y. State Citizens’ Coal. for Child. v. Poole , 922 F.3d 69 (2d Cir. 2019), reh'g denied , 935 F.3d 56 (2d Cir. 2019), and Cal. State Foster Parent Ass'n v. Wagner , 624 F.3d 974 (9th Cir. 2010), with Midwest Foster Care and Adoption Ass'n v. Kincade , 712 F.3d 1190 (8th Cir. 2013).

We cannot grant the Cabinet's request. Putting aside whether we think that Glisson was correct, under the law-of-the-circuit doctrine, a "panel of this Court cannot overrule the decision of another panel" "unless an inconsistent decision of the ... Supreme Court requires modification of the decision or this Court sitting en banc overrules the prior decision." Darrah v. City of Oak Park , 255 F.3d 301, 309 (6th Cir. 2001) (quoting Salmi v. Sec'y of Health &...