Patton v. Blum

Decision Date04 April 2014
Docket NumberCase No. 4:13 CV 2376 CDP
CourtU.S. District Court — Eastern District of Missouri
PartiesSTEPHANIE PATTON, Plaintiff, v. CASSIE BLUM, et al., Defendants.
MEMORANDUM AND ORDER

Plaintiff Stephanie Patton operated a state-licensed adult day care facility in Saint Louis. In October 2008, inspectors from the Missouri Department of Health and Senior Services (DHSS) arrived at the facility to conduct an inspection. Things went downhill from there. After a series of escalating incidents, the facility closed, and DHSS revoked its license. Patton appealed several decisions made by DHSS and another state agency, the Department of Social Services, to the state's Administrative Hearing Commission. The AHC ruled for Patton in each of its findings. The agencies appealed to Missouri state court, which largely left the AHC's findings intact. Now, Patton brings claims against four DHSS employees related to the inspection and eventual closure of her adult day care facility. She filed this action in state court, and defendants removed on November 22, 2013.

Citing Rule 12(b)(6), Fed. R. Civ. P., the defendants have moved to dismiss four of the six claims in the complaint. I find that Patton has alleged enough to support each of her claims, so I will deny the defendants' motion, except that I will grant it as to Count VI (malicious trespass) and dismiss the portion of that claim that relates to real property. I will also dismiss Count I (due process) only as against defendant Cassie Blue because none of Patton's allegations related to that count implicate Blum.

I. Background1

In 1993, Patton opened an adult day care facility in Saint Louis dedicated to serving African American residents. For fifteen years, she operated the facility, called Peace of Mind Adult Day Care, without incident. On October 16, 2008, two DHSS inspectors, Cassie Blum and Sharon Buckner, arrived at the facility to conduct an unannounced inspection. Patton wished to accompany Blum and Buckner during the inspection, but Blum told her she could not do so. A dispute ensued, and Blum struck Patton on the hand, calling her a "nigger" and "illiterate."

Later, Patton called Tracy Cleeton, a DHSS employee who had previously inspected Peace of Mind. She complained about the treatment she received.Cleeton advised her to call the inspectors' regional supervisor, Mary Collier. Patton called to speak with Collier but asked for "Mary," so she ended up speaking with another DHSS employee. When Patton determined she had spoken to the wrong person, she contacted Collier by telephone and letter. In response, Patton received a letter from a DHSS attorney admonishing her to cooperate with inspectors without mentioning Blum's behavior toward Patton.

DHSS employees Cleeton, Tracy Niekamp, and Michelle Williamson discussed Patton's telephone call to Cleeton, as well as a police report apparently filed about the incident, and statements from Blum and Buckner. They decided that Niekamp and Williamson would conduct a follow-up inspection of Peace of Mind. On December 5, 2008, they inspected Peace of Mind, citing Patton for minor issues and for not having a nurse on duty. Niekamp and Williamson concluded no nurse was on duty without asking any employees whether there was a nurse present or conducting an exit interview with Patton, which was customary. In fact, there were two nurses on duty and present at the time of the inspection.

Peace of Mind's adult day care license was set to expire on December 20, 2008. In a letter dated December 19, 2008, Williamson, Niekamp, and Cleeton issued Patton a provisional license and informed her that the license had beenconverted from a "medical model" to a "social model" license. This letter did not inform Patton of her right to appeal the decision or receive a hearing.

DHSS inspectors Niekamp and Williamson prepared their inspection report on January 13, 2009. Because it was prepared several weeks after the inspection, it was not signed by Patton as was customary. Niekamp and Williamson issued a "statement of deficiencies" to Patton on January 14, 2009. A few days later, Patton submitted a plan of correction, which DHSS accepted.

On February 2, 2009, the Missouri Department of Social Services (DSS) notified Patton that her participation agreement with MO HealthNet had been retroactively terminated as of December 20, 2008. MO HealthNet is Missouri's Medicaid program. DSS told Patton that the termination was because Peace of Mind now had a "social model" license rather than a "medical model" license. Patton disputes that Missouri law makes any distinction whatsoever between "medical model" and "social model" licenses. However, because her participation agreement was terminated, she lost the opportunity to get Medicaid funding. This was devastating because nearly all of Peace of Mind's residents were dependent on Medicaid. Even before sending the February 2 letter, DSS had begun denying reimbursement for outstanding MO HealthNet claims.

Inspectors conducted two revisit surveys in early February. At the first visit, only minor issues were cited. At the second visit, inspectors found that Peace of Mind substantially complied with all licensure laws, employed a nurse, and qualified as a "medical model" adult day care facility.

After the revisits, Patton sought to re-enroll her facility as a MO HealthNet provider with DSS. The agency sent her an open-ended, unrestricted participation agreement, which Patton signed and returned in March 2009. But DSS did not sign the agreement. Instead, it sent a DSS employee to meet with Patton in a state representative's office. The employee, Judith Muck, agreed to send a closed-end provider agreement to Patton, which Muck represented would be made retroactive to February 11, 2009. By this time, Patton had been locked out of the facility by her landlord, so she borrowed money from friends to regain access to the building.

Despite the reassurances from Muck, DSS refused to pay MO HealthNet claims from February and March. DSS apparently conditioned this refusal on Patton's failure to provide information required by the previous participation agreement.

When Patton attempted to bring her case to the attention of supervisors at DSS and DHSS, state legislators, and the governor's office, agency employees began investigating Patton for MO HealthNet overpayments. DSS requested fromPatton documents related to past claims. Patton informed DSS that the documents had been lost, some in the 2008 flood of University City, where Peace of Mind was located, and some when Patton's landlord threw her belongings in the street after she failed to make rent payments during the ongoing incident. DSS then sought $487,462.08 from Patton in alleged overpayments because she could not produce the documents it sought.

On June 4, 2009, DHSS employee Cleeton sent Patton a letter notifying her that the agency had visited Peace of Mind and found it closed and vacant. The letter stated that DHSS would consider the facility closed and revoke her license if she did not respond. On July 7, 2009, another DHSS employee revoked Peace of Mind's license by letter. Neither letter informed Patton of her right to appeal.

Patton appealed six decisions2 by DHSS and DSS to the Missouri Administrative Hearing Commission, which found in her favor. The agencies appealed to circuit court and eventually the Missouri Court of Appeals. The appellate court largely affirmed the AHC's determinations, with the exception ofits conclusion that DHSS had acted with a racially discriminatory animus toward Patton. As a result, Patton did not have to pay the overpayment sanction and was reimbursed for services provided by Peace of Mind from December 20, 2008 to February 20, 2009. The AHC also found that Peace of Mind was entitled to a provider participation agreement.

Because of her struggle with DHSS and DSS, and the eventual loss of her business, Patton accumulated a significant amount of debt, which impaired her credit rating. Her house was foreclosed upon, and her reputation, mental and physical health, and family have suffered.

II. Claims

Patton now brings claims against DHSS employees Blum, Cleeton, Niekamp, and Williamson, in their individual and official capacities. Her claims are titled as follows: Count I - Violations of Right to Fair Notice of Laws and To Notice and an Opportunity to be Heard (Due Process Violations); Count II - Violation of the Right to be Free from Racial Discrimination and Arbitrary and Selective Enforcement of Laws (Equal Protection Violation); Count III - Violation of Right to Free Speech and to Petition Government (First Amendment Violation); Count IV - Violation of § 536.021, RSMo; Count V - Violation of Right to Notice and Opportunity to be Heard (Due Process Violation); and Count VI - MaliciousTrespass. Patton seeks compensatory, nominal, punitive, and statutory damages, costs and attorney fees, and a declaration that the distinctions between medical model and social model licenses are unlawful and void. The defendants have moved to dismiss four of Patton's claims under Rule 12(b)(6), Fed. R. Civ. P.

III. Motion to Dismiss Standard

The purpose of a motion to dismiss under Rule 12(b)(6) is to test the legal sufficiency of the complaint. When considering a 12(b)(6) motion, the court assumes the factual allegations of a complaint are true and construes them in favor of the plaintiff. Neitzke v. Williams, 490 U.S. 319, 326-27 (1989).

Rule 8(a)(2), Fed. R. Civ. P., provides that a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." In Bell Atlantic Corp. v. Twombly, the Supreme Court clarified that Rule 8(a)(2) requires complaints to contain "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action." 550 U.S. 544, 555 (2007); accord Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009). Specifically, to survive a motion to...

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