Lightfoot v. District of Columbia

• Decision Date: 24 September 2004
• Docket Number: No. CIV.A.01-1484 CKK.,CIV.A.01-1484 CKK.
• Citation: 339 F.Supp.2d 78
• Parties: Elizabeth LIGHTFOOT, et al., Plaintiffs, v. DISTRICT OF COLUMBIA, et al., Defendants.
• Court: U.S. District Court — District of Columbia

339 F.Supp.2d 78

Elizabeth LIGHTFOOT, et al., Plaintiffs, v. DISTRICT OF COLUMBIA, et al., Defendants.

No. CIV.A.01-1484 CKK.

United States District Court, District of Columbia.

September 24, 2004.

COPYRIGHT MATERIAL OMITTED

Duncan Norman Stevens, Miller & Chevalier, Chartered, Jeffrey S. Gutman, The George Washington University School of Law, Washington, DC, for Plaintiffs.

Jacques Philippe Lerner, Office of Corporation Counsel, D.C., Washington, DC, Alfred Long Scanlan, Jr., Eccleston & Wolf, P.C., Baltimore, MD, Laura E. Jordan, Law Offices of Laura E. Jordan, P.C., Washington, DC, Andrea Suzanne Marshall, Eccleston & Wolf, P.C., Baltimore, MD, S. Todd Wilson, Eccleston & Wolf, P.C., Baltimore, MD, for Defendants.

MEMORANDUM OPINION

KOLLAR-KOTELLY, District Judge.

Currently pending before the Court are Plaintiffs' Motion for Summary Judgment on Counts Six and Seven of the Third Amended Complaint. The Government Defendants and Defendant CLW/CDM filed separate Opposition briefs, and Plaintiffs responded with separate Reply Briefs. This set of filings represents another step in the now three-year struggle by Plaintiffs — a collection of former District of Columbia employees whose disability compensation benefits were terminated, suspended or modified by Defendants — to reform and standardize the District of Columbia's pre-termination process within the strictures of both the District of Columbia Administrative Procedure Act and the Due Process Clause of the Fifth Amendment. Upon a review of the relevant motions, the Court shall grant Plaintiffs' Motion for Partial Summary Judgment.

I: BACKGROUND

On July 6, 2001, Plaintiffs filed the above-captioned action, initially seeking a preliminary injunction to reinstate their previously-denied disability benefits and to enjoin any future termination of benefits until the District of Columbia instituted a more thorough pretermination process. In a Memorandum Opinion dated October 29, 2001, the Court, while finding a likelihood of success on the merits, denied Plaintiffs' Motion for a Preliminary Injunction for failure to show irreparable injury. Lightfoot v. District of Columbia, No. 01-1484, slip op. at 29 (D.D.C. Oct. 29, 2001).

After a series of amendments and discovery-related motions, Plaintiffs filed a Third Amended Class Action Complaint on January 22, 2003. Third Amended Class Action Complaint for Declaratory and Injunctive Relief ("Third Am. Compl."). Named as Defendants were the District of Columbia, and the following who were sued in their official capacities as employees of the District of Columbia: Anthony Williams, Mayor of the District of Columbia; Gregory P. Irish, Director of the District of Columbia Department of Employment Services; Milou Carolyn, Director of the District of Columbia Office of Personnel; and James Jacobs, Director of the District of Columbia Office of Risk Management (collectively, the "Government Defendants"). Third Am. Compl. at ¶¶ 10-14. Also named as a Defendant was CLW/Creative Disability Management ("CLW/CDM"), a private entity with which the District has contractually delegated the power to make determinations on disability compensation claims and to terminate, suspend or modify existing benefit awards. Id. at ¶ 15.

Plaintiffs' current Motion for Partial Summary Judgment concerns two counts contained within the Third Amended Complaint. Count VI alleges that Defendants' failure to adopt written and consistently applied standards, policies and procedures governing the termination, suspension and modification of disability compensation benefits violates the Due Process Clause of the Fifth Amendment of the United States Constitution. Id. at ¶ 142. Count VII alleges that the Government Defendants' implicit adoption of unwritten practices regarding the termination, suspension or modification of disability benefits without publishing notice in the District of Columbia Register and without public comment violates D.C.Code § 2-505. Id. at ¶ 144.

A. Statutory Background

1. Overview of the District of Columbia Compensation Act

Under the D.C. Disability Compensation Act ("DCA"), D.C.Code §§ 1-623, et seq., District of Columbia government employees whose injury or death is sustained while in the performance of their duties are entitled to benefits under the Disability Compensation Program. D.C.Code § 1-623.2. In addition to monetary compensation, the District must also provide the beneficiaries medical services, appliances and supplies prescribed or recommended by qualified physicians that have been approved by the Mayor or his designee. D.C.Code § 1-623.3. Generally, to obtain benefits — which range from two-thirds of the employee's monthly pay (for total disability) to two-thirds of the difference between the employee's monthly pay and his/her post-earning monthly wage earning capacity (for partial disability) — the injured employee must (1) provide written notice to his/her supervisor of the disability within thirty days of the injury, D.C.Code § 1-623.19, and (2) make a claim for disability compensation within three years of the date of the injury or death. D.C.Code § 1-623.22.

Upon receipt of a claim, the Mayor or his designee must make findings of fact "as soon as practicable," D.C. Mun. Regs., tit. 7, § 7-1-106.1, following consideration of the claim and any additional investigation. D.C.Code § 1-623.23(a). Additional investigation may involve requiring the allegedly injured employee to submit to an independent medical examination conducted by a physician selected by the District. D.C.Code § 1-623(a). Recognizing that injuries may heal over time, the DCA includes a provision permitting the Mayor or his designee, upon belief that there has been a change in condition, to terminate, suspend, or modify an award of compensation. D.C.Code § 1-623.23(d).

Once a benefit modification has occurred, Section 1-623.24(b) of the DCA provides that a claimant is entitled to a hearing if requested within thirty days of the final decision regarding compensation. D.C.Code § 1-623.24(b). The DCA does not impose a deadline upon which Defendants must convene the evidentiary hearing. With regard to the structure and nature of the adversarial hearing, Section 1-623.24(b) provides generally that the representative of the Mayor shall hold the hearing "in such manner as to best ascertain the rights of the claimant" and "shall receive such relevant evidence as the claimant adduces and such other evidence as he or she determines necessary or useful in evaluating the claim." D.C.Code § 1-623.24(b). Following that hearing, the Mayor or his designee must issue a written decision within thirty days. D.C.Code § 1-623.24(d). Appeal of this decision must be made within thirty days of its issuance, and lies with the D.C. Court of Appeals. D.C.Code § 1-623.28.

2. Implementation of the DCA and the Disability Benefits Termination Process

While the Government Defendants have clearly issued regulations governing initial claims for benefits, 7 D.M.C.R. Chapter 1, the Government Defendants have admittedly not published rules governing the standards, practices and procedures applicable when disability compensation benefits are terminated, suspended or modified in the District of Columbia Register. Third Am. Compl. ¶ 25; Government Defendants' Statement in Opposition to Plaintiffs' Statement of Material Facts as to Which There Exists a Genuine Issue ("Gov't's Opp'n to Pls.' Stmt. of Mat. Facts") ¶ 2 ("We concede that the Program has not published termination procedures...."); Statement of Undisputed Material Facts in Support of Plaintiffs' Motion for Summary Judgment on Counts Six and Seven of the Third Amended Complaint, Ex. 2 (Jacobs Dep.), at 226 line 6-12, Ex. 3 (Dailey Dep.) at 192 line 14 — 193 line 11. Additionally, the Government Defendants have admittedly not published an internal claims procedure manual. Gov't's Opp'n to Pls.' Stmt. of Mat. Facts ¶ 3.

Instead, according to the Government Defendants, the structure and parameters of the benefit modification process for the Disability Compensation Program may be found largely in three discrete locations: (1) the DCA itself; (2) the October 1, 2001, contract between the District of Columbia and Defendant CLW/CDM along with CLW/CDM's companion "Proposal to Support Services for the District of Columbia Disability Compensation Program," Gov't's Opp'n to Pls.' Stmt. of Mat. Facts, Ex. 2 (CLW/CDM Proposal); and (3) the "best practices" of the claims adjustment industry. Id. ¶¶ 4-6. According to the Government Defendants, "the adjustment process is a complex and ongoing one that does not lend itself to fixed rules"; as such, "[b]est practices are generally not written ... they reflect well-established methods of adjustment for weighing evidence, consulting industry reference materials, seeking advice from medical consultants, and engaging in the other steps of adjustment commonly known in the field." Id. ¶ 6.¹ In addition to these three sources, the Government Defendants admit that the only other writings that possibly affect the disability benefit modification process are the largely procedural guidelines set out in the Termination of Benefits ("TOB") notice, which provides the first inkling to former beneficiaries that their benefits are being eliminated, and relevant "District of Columbia caselaw." Id. ¶ 2.

While the Government Defendants have historically carried out the entire Disability Compensation Program, the District has contracted out the function of actually determining whether to grant or deny claims and whether to terminate, suspend or modify benefits to administrative support companies in recent years. Defendant CLW/CDM assumed this function as third-party administrator on October 1, 2001, as part of a three-year contract with the District.² In addition to those sources identified by the Government Defendants as providing the parameters of the Disability Compensation Program, CLW/CDM adds...