NAACP v. Wilmington Medical Center, Inc.

• Citation: 453 F. Supp. 330
• Decision Date: 21 June 1978
• Docket Number: Civ. A. No. 76-298.
• Court: U.S. District Court — District of Delaware
• Parties: NATIONAL ASSOCIATION FOR the ADVANCEMENT OF COLORED PEOPLE et al., Plaintiffs, v. The WILMINGTON MEDICAL CENTER, INC., et al., Defendants.

453 F. Supp. 330

NATIONAL ASSOCIATION FOR the ADVANCEMENT OF COLORED PEOPLE et al., Plaintiffs, v. The WILMINGTON MEDICAL CENTER, INC., et al., Defendants.

Civ. A. No. 76-298.

United States District Court, D. Delaware.

June 21, 1978.

COPYRIGHT MATERIAL OMITTED

Douglas Shachtman, Community Legal Aid Society, Inc., Wilmington, Del., Marilyn G. Rose and Herbert Semmel, Center for Law and Social Policy, Washington, D. C., and Louise Lander, New York City, for plaintiffs.

Jeffrey M. Goddess, City Sol., Charles H. Toliver IV, and Alan Bernard Scher, Asst. City Sols., Wilmington, Del., for plaintiff intervenor, City of Wilmington.

Rodney M. Layton and William J. Wade of Richards, Layton & Finger, Wilmington, Del., for defendants The Wilmington Medical Center, Inc., Crawford H. Greenewalt and Joseph A. Dallas.

James W. Garvin, Jr., U. S. Atty., Wilmington, Del., Barbara Allen Babcock, Asst. Atty. Gen., Barbara B. O'Malley and Rebecca L. Ross, Trial Attys., Dept. of Justice, Washington, D. C., Stephanie W. Naidoff, Regional Atty., and William Reinhart, Asst. Regional Atty., H. E. W., Philadelphia, Pa., for defendant Secretary of H. E. W.

Edward F. Kafader, Asst. Atty. Gen., Dept. of Justice, Dover, Del., for defendant Amos Burke, Director of the Bureau of Comprehensive Health Planning.

William C. Gordon, pro se.

OPINION

LATCHUM, Chief Judge.

This civil rights class action, spawned by the controversial proposal of the defendant Wilmington Medical Center to relocate the bulk of its urban hospital services to a suburban location, is presently before the Court on cross-motions for partial summary judgment filed by the defendant Secretary of Health, Education and Welfare and by the plaintiffs.¹ These motions were filed in response to the second amended and supplemental complaint² in which the plaintiffs for the first time asserted a cause of action against the Secretary based on a challenge to the constitutionality of the administrative regulations promulgated by the Secretary in the implementation of Title VI of the Civil Rights Act of 1964³ and Section 504 of the Rehabilitation Act of 1973.⁴

Plaintiffs contend that the procedures established by the Secretary for enforcing the antidiscrimination provisions of Title VI and Section 504 abridged the plaintiffs' right to due process of law, because such procedures fail to provide a "fair hearing" to persons whose discrimination complaint against a recipient of federal financial assistance is settled through informal, voluntary compliance measures required under the statutes and the regulations. Alternatively, the plaintiffs argue that the regulations violate their right to the equal protection of the law⁵ since applicants for, or recipients of, federal assistance are accorded a "fair hearing" before the grant of assistance to them may be withheld or terminated while persons charging a particular recipient with discrimination are denied a "fair hearing" on the merits of their claims.

I. THE REGULATIONS.

In order to implement the legislative mandate expressed in Title VI and Section 504, HEW and other federal agencies empowered to extend financial assistance were required to issue rules, regulations or orders of general applicability to carry out the objectives of the laws in question.⁶ The regulations at issue in this case, found at 45 C.F.R. Part 80 (Title VI) and 45 C.F.R. Part 84 (Section 504),⁷ divide the Secretary's enforcement duties into four phases: (1) the investigative phase; (2) the voluntary compliance phase; (3) the administrative hearing phase; and (4) the fund termination phase. The investigative phase is triggered whenever HEW has reason to believe, because of a complaint or other information, that a recipient of federal aid has failed to abide by or comply with HEW's rules and regulations. 45 C.F.R. § 80.7(a)-(c). A finding of noncompliance activates the second phase; the statutes⁸ and the regulations require the Secretary to first endeavor informally to secure the offending recipient's voluntary compliance with HEW rules and regulations. See 45 C.F.R. § 80.7(d)(1). If the Secretary determines that compliance cannot be voluntarily achieved, then the recalcitrant recipient and the complainant, if any, are notified of the intention to terminate or withhold funding. However, the administrative hearing phase, which begins only after efforts at voluntary compliance have broken down, must precede the final decision to terminate federal aid. 45 C.F.R. § 80.8-80.11. The hearing consists of an evidentiary proceeding before an administrative law judge who makes a finding of compliance or noncompliance, subject to administrative appeal.⁹Id. The decision to terminate aid, after an express finding of noncompliance on the record, becomes effective thirty days after the filing of a full written report of the reasons for such a decision with the appropriate committees of the House and Senate.¹⁰See 42 U.S.C. § 2000d-1; 45 C.F.R. § 80.8(c).

II. THE FACTS.

At the time this law suit was commenced in September, 1976, no administrative complaint had been filed by the plaintiffs with the Secretary.¹¹ Nevertheless, the Court held that service of the complaint in this case upon the defendant Secretary constituted sufficient information of a possible failure to comply with Title VI and Section 504 to trigger investigative review.¹² Thus, in accordance with the Secretary's regulations the allegations of the plaintiffs' complaint, together with other information supporting their view that the proposed hospital relocation (Plan Omega) would have a discriminatory impact prohibited by the statutes, were promptly and thoroughly investigated.¹³ In early July, 1977, the investigation culminated in a finding that Plan Omega would, as the plaintiffs had in fact charged, contravene the national antidiscrimination policy mandated by Title VI and Section 504.¹⁴ The recipient, Wilmington Medical Center (WMC), and the plaintiffs, as complainants, were duly informed of HEW's finding of noncompliance and the circumstances of, and the grounds for, that finding. Plan Omega was deemed legally inadequate because, inter alia, its concept at dual facilities with duplicated services, its patient/physician "option" mode of admission, and the travel burdens peculiarly affecting minorities, the poor and the handicapped seeking access to the new suburban hospital, would likely have a discriminatory impact upon plaintiffs and the class they represent.¹⁵ HEW also informed WMC that it could challenge and seek to rebut the prima facie finding of noncompliance through an administrative hearing or it could elect to modify Plan Omega in accordance with various conditions and assurances that HEW had indicated would eliminate Plan Omega's potential discriminatory effect.¹⁶ Faithful to the legislative mandate, HEW began informal negotiations with representatives of WMC aimed at bringing Plan Omega into compliance. As a result of these negotiations, WMC decided voluntarily to modify Plan Omega and agreed to adopt HEW's recommendations concerning the conditions and assurances necessary to secure Plan Omega's compliance with the civil rights laws. A contract formally embodying these assurances and conditions was executed on November 1, 1977.¹⁷ It is also noteworthy that counsel for, and other representatives of, the plaintiffs were permitted to participate and to submit relevant information not only during HEW's investigative phase, but also during the extensive deliberations between HEW and WMC in the voluntary compliance phase.¹⁸ Counsel for plaintiffs was afforded the opportunity, for example, to suggest possible assurances which HEW should require of WMC and to comment upon and to criticize assurances proposed by WMC or by HEW itself.¹⁹ In any event, the voluntary compliance phase of the Secretary's enforcement responsibilities came to a successful conclusion upon the execution of the contract of assurances. That is, the Secretary concluded that Plan Omega, as modified by the assurances, would comport with Title VI and Section 504 and there were thus no grounds for commencing the administrative hearing phase of his Title VI enforcement procedures. Since the plaintiffs did not share the Secretary's confidence in the adequacy of the assurances, however, the Secretary's decision to approve the contract was challenged in this Court pursuant to the judicial review provisions of the Administrative Procedure Act.²⁰ In an earlier opinion, the Court concluded that the Secretary's decision to approve the contract of assurances, measured by the arbitrary and capricious standard of judicial review, was rationally supported by the evidence of record.²¹ Having affirmed the Secretary's decision, the Court granted summary judgment in his favor and against the plaintiffs.²²

III. THE PROCEDURAL DUE PROCESS CLAIM.

In what can be viewed in one sense as a form of collateral attack on the Secretary's determination regarding Plan Omega, plaintiffs now urge the Court to invalidate the Secretary's regulations as violative of the due process rights of complainants, because of the failure to accord them an "evidentiary hearing" on the issue whether Plan Omega, as modified, was consistent with the dictates of Title VI and Section 504. Although they have not specifically articulated the due process deficiencies of the Secretary's regulations, plaintiffs apparently contend that they fail to provide (1) the right to submit relevant information to the Secretary in support of a complainant's position that he or she has suffered, or is likely to suffer, discrimination at the hands of a recipient; (2) an opportunity to review and comment upon proposed assurances, developed in the course of voluntary compliance negotiations, which the Secretary has concluded will eliminate or substantially mitigate the recipient's alleged discriminatory actions; and (3) if voluntary compliance is nevertheless achieved, a right to a trial-type...