Jones v. DeNotaris

• Decision Date: 16 January 2015
• Docket Number: Civil Action No. 13–4500.
• Citation: 80 F.Supp.3d 588
• Parties: Michael JONES, Plaintiff, v. David J. DeNOTARIS et al., Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

80 F.Supp.3d 588

Michael JONES, Plaintiff

v.David J. DeNOTARIS et al., Defendants.

Civil Action No. 13–4500.

United States District Court, E.D. Pennsylvania.

Signed Jan. 16, 2015.

Robert T. Vance, Jr., Law Offices of Robert T. Vance, Jr., Philadelphia, PA, for Plaintiff.

Cara Bushman Greenhall, Office of Attorney General, Philadelphia, PA, for Defendants.

AMENDED MEMORANDUM

PRATTER, District Judge.

This case presents novel questions of law in the Third Circuit: first, whether a plaintiff alleging violations of the Randolph–Sheppard Act (“RSA”), 20 U.S.C. § 107 et seq., may proceed directly against a state licensing agency and its officials under 42 U.S.C. § 1983, and, second, whether he may proceed without “exhausting” the procedures explicitly provided for by the RSA. For the reasons that follow, the Court answers both questions in the negative.

I. THE RANDOLPH–SHEPPARD ACT

“For the purposes of providing blind persons with remunerative employment, enlarging the economic opportunities of the blind, and stimulating the blind to greater efforts in striving to make themselves self-supporting,” the Randolph–Sheppard Act authorizes licensed blind persons “to operate vending facilities on any Federal property,” 20 U.S.C. § 107(a), and, further, requires the federal government and cooperating state licensing agencies to give priority to licensed blind in “the operation of [these] vending facilities,” id. § 107(b). Blind licensees operating vending facilities on federal property earn the income the machines generate. Id. § 107d–3(a).

The RSA creates partnerships between the federal government and states that choose to participate. On the federal side, the RSA assigns to the United States Secretary of Education rulemaking, information-gathering, and oversight responsibilities. See generally id. § 107a(a). One such responsibility is the “designat[ion of] the State agency for the blind in each State ... to issue licenses to blind persons ... for the operating of vending facilities on Federal ... property.” Id. § 107a(a)(5). State licensing agencies, in turn, are “authorized, with the approval of the [federal authority] in control of” federal property, “to select a location for [a vending] facility and the type of facility to be provided.” Id. § 107a(c). State licensing agencies then select the operators of these facilities, and they must “give preference to blind persons who are in need of employment.” Id. § 107a(b). Each participating state must establish an elected Committee of Blind Vendors, which is “fully representative of all blind licensees in the State program,” id. § 107b–1(2), and which participates in “receiving [such] grievances of blind licensees and serving as advocates for such licensees,” id. § 107b–1(3)(B).

The RSA specifically provides a grievance procedure for “dissatisfied” blind vendors: state licensing agencies participating in the program must agree “to provide to any blind licensee dissatisfied with any action arising from the operation or administration of the vending facility program an opportunity for a fair hearing,” and, further, “to submit the grievances of any blind licensee not otherwise resolved by such hearing to arbitration as provided in section 107d–1.” Id. § 107b(6). Section 107d–1, in turn, lays out the hearing and arbitration procedure to be followed by “[a]ny blind licensee who is dissatisfied with any action arising from the operation or administration of the vending facility program.”Id. § 107d–1(a).¹ The state licensing agency, upon a blind licensee's “request,” must provide “a full evidentiary hearing,” id. —and, of course, one that is also “fair,” id. § 107b(6).

Then,

[i]f such blind licensee is dissatisfied with any action taken or decision rendered as a result of such hearing, he may file a complaint with the Secretary who shall convene a panel to arbitrate the dispute pursuant to section 107d–2 of this title, and the decision of such panel shall be final and binding on the parties except as otherwise provided in this chapter.

Id. § 107d–1(a). Section 107d–2 requires the Secretary of Education to “convene an ad hoc arbitration panel” when he receives such a complaint, delineates how such panels are to be constituted, and requires the panel to “give notice, conduct a hearing, and render its decision.” Id. § 107d–2.

Although the RSA nowhere creates a private cause of action, § 107d–2 also subjects the panel's decision “to appeal and review as a final agency action for purposes of chapter 7 of such Title 5”—that is, to judicial review in accordance with the Administrative Procedure Act (“APA”), 5 U.S.C. § 500 et seq., and, specifically, 5 U.S.C. § 706.

II. FACTUAL AND PROCEDURAL BACKGROUND²

Michael Jones has sued David J. DeNotaris, Director of the Pennsylvania Bureau of Blindness and Visual Services (“BBVS”), Office of Vocational Rehabilitation (“OVR”), as well as several other officials in that Commonwealth agency. Mr. Jones, who is African–American, has been a licensed blind operator in BBVS's Business Enterprises Program for a number of years. Mr. Jones alleges that because of the OVR's racial prejudice, “it took [him] three (3) years to get into the BEP when it typically takes only 16 weeks.” Compl. ¶ 14. In the ensuing years, Mr. Jones alleges, the discriminatory treatment continued. In 2005, for instance, the OVR awarded a facility to a white blind vendor with three years' less seniority than him, “despite the fact that bids are required to be awarded based on seniority.” Compl. ¶ 15.

In May 2011, Mr. Jones was awarded Vending Facility 805 (“VF 805”), but he “and his staff [soon] began to experience ... racial harassment and his vending machines were vandalized [with] racial slurs.” Compl. ¶ 19. When Mr. Jones complained to the OVR officials he has named in this suit, they “ignored his complaints and did nothing to remedy the situation”; they did not even “acknowledge[ ] Jones's complaints” until he complained to the Postal Inspector General. Compl. ¶ 20. This type of treatment, Mr. Jones alleges, is similar to that experienced by another black blind vendor at the same site. Compl. ¶ 25.

In August 4, 2011, the Postal Service locked Mr. Jones out of VF 805 with, he alleges, the OVR's acquiescence, in order to permit a nonblack, sighted contractor to operate VF 805. Only when Mr. Jones “agreed to utilize a non-Black, sighted vending contractor, West Dairy, Inc., to operate the location,” was he allowed back to operate VF 805, on September 5, 2011. Compl. ¶ 22. The OVR, Mr. Jones alleges, took these actions because, with West Dairy operating VF 805, the “OVR”—presumably as opposed to him or another blind licensee—“received a percentage of the revenue generated there.” Compl. ¶ 23.

When the OVR decided to rebid VF 805 in August 2012, it denied Mr. Jones's bid because it “had already entered into a contract with a sighted vendor.” Compl. ¶ 26. And when the OVR again “decided to re-bid the contract” in October 2012, after the Defendants had “improperly placed Jones on probation allegedly for failing to pay set-aside fees and submit monthly reports,” the OVR denied Mr. Jones's rebid out of discriminatory animus rather than these stated reasons, which were, Mr. Jones alleges, purely pretextual. Id.

Mr. Jones appealed the denial. On February 29, 2012, the state hearing officer granted Mr. Jones partial relief, but no damages for lost income. Mr. Jones again appealed, this time to the Secretary of Education,³ as provided for by §§ 107d–1 and 107d–2 of the RSA. On November 1, 2012, Mr. Jones also filed an appeal to the OVR for the decision of the individual Defendants “to place him on probation allegedly for failing to pay set-aside fees and submit monthly reports,” Compl. ¶ 28. He also filed, through 2012 and 2013, several other appeals to the OVR for what he alleges were the agency and its employees' “discriminatory and retaliatory” actions. Compl. ¶¶ 23–32.

In his Amended Complaint (Docket No. 6), Mr. Jones presents two counts: Count I, for the Defendants' alleged violation of 42 U.S.C. § 1983 by their violation of the Randolph–Sheppard Act, and Count II, for the Defendants' alleged violation of the Americans with Disabilities Act (“ADA”), 42 U.S.C. §§ 12131 –12134. The Defendants have moved to dismiss certain components of both claims (Docket No. 8), as set out in the margin.⁴

The only issues currently before the Court—as the Court characterizes the parties' dispute over “exhaustion”—are whether a plaintiff pursuing alleged violations of the Randolph–Sheppard Act may proceed directly against a state agency under 42 U.S.C. § 1983, as Mr. Jones purports to do, and, further, whether any individual purporting to sue for violation of the RSA may proceed at all (under § 1983 or directly) without first “exhausting” the procedures explicitly provided for by the RSA.

Mr. Jones alleges that he “was not required to exhaust administrative remedies with respect to any of [his] appeals” because, given the “numerous and continuous discriminatory and retaliatory actions of the Defendants,” pursuing such remedies “would have been futile because of the certainty of an adverse decision.” Compl. ¶ 35. “Moreover,” he asserts, “there is no requirement that [he] exhaust any administrative remedies” before bringing an action under § 1983. Compl. ¶ 36.

The Defendants, by contrast, citing case law from the Courts of Appeals for the D.C. and Sixth Circuits, argue that “exhaustion of the administrative remedies is required before a party seeks recourse through the federal court system,” Mot. Dismiss 10, and that Mr. Jones has not made any showing to justify application of the narrow futility exception. In response, Mr. Jones contends that the Defendants “have admitted” that “no cases in the Eastern District [of Pennsylvania] or the Third Circuit have held that exhaustion of administrative remedies is required before a party seeks to enforce the Randolph–Sheppard Act through the federal court system,” and that that lack of...