Elsie Alexander v. Pathfinder, Inc. ( 1996 )

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No. 95-3680
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Elise Alexander, Individually, *
and as Guardian of Larry * Appeal from the United States
Alexander, an incompetent * District Court for the Eastern
person, * District of Arkansas.
*
Appellant, *
*
v. *
*
Pathfinder, Inc.; Colleen *
Black, Executive Director of *
Pathfinder, Inc., Individually *
and in her official capacity; *
Cindy Crook, Administrator of *
Pathfinder Home, Individually *
and in her official capacity; *
and Tom Dalton, in his official *
capacity as Director of Arkansas *
Department of Human Services, *
*
Appellees. *
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Submitted: May 16, 1996
Filed: July 29, 1996
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Before McMILLIAN, FAGG, and MORRIS SHEPPARD ARNOLD, Circuit Judges.
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MORRIS SHEPPARD ARNOLD, Circuit Judge.
This case arises from a state administrative hearing that permitted
the discharge of a mentally retarded man from a care facility. After
losing in the hearing, his guardian filed a complaint in federal court,
asserting violations of various federal and state laws. The district court
found that the entire complaint was subject to dismissal under the
doctrines of claim and issue preclusion. We affirm in part, reverse in
part, and remand.
I.
Pathfinder, a ten-bed intermediate care facility for the mentally
retarded (ICF/MR), discharged Larry Alexander after he had resided there
for a number of months. His mother and legal guardian, Elise Alexander,
objected to the discharge. An administrative hearing under the authority
of the Arkansas Department of Human Services was held to determine the
propriety of the discharge, after which the hearing officer issued an
opinion justifying his conclusion that Mr. Alexander had been discharged
for "medical reasons" (see Arkansas Office of Long-Term Care Regulation
353), and for "good cause" (see 42 C.F.R. § 483.440(b)(4)).
The hearing officer made extensive findings of fact in support of his
decision, and we now summarize them. Mr. Alexander has a number of health
problems that demand a high level of care, including Down's syndrome with
severe retardation, morbid obesity, severe asthma, and sleep apnea. With
Ms. Alexander's consent, Mr. Alexander was put on a "behavior modification
plan" to control his weight. A few months after Mr. Alexander began to
reside at Pathfinder, an incident occurred that suggested that Mr.
Alexander might have been beaten. Ms. Alexander complained to Pathfinder
but declined to pursue the matter with the police. At some point, Ms.
Alexander told Pathfinder that its employees used abusive language and were
rude to her. Pathfinder officials began taping Ms. Alexander's telephone
calls to Pathfinder with her consent in order to discover which of its
employees might have been abusive. Ms. Alexander later withdrew her
consent, yet Pathfinder continued to tape the calls.
The hearing officer outlined the level of care that Pathfinder had
to provide for Mr. Alexander. A "team" of physicians (including an
attending physician who functioned as a "quarterback") had to be available
to treat Mr. Alexander for a variety of problems. Mr. Alexander had to
take quite a number of
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different medications, and had to be monitored to ensure that he did not
cease breathing in his sleep. Without consulting a physician, Pathfinder
administrators decided that, based on Mr. Alexander's medical diagnoses and
what they perceived to be his deteriorating condition, he should be
discharged.
In his conclusions of law, the hearing officer decided that the level
of care that Mr. Alexander required was too onerous for Pathfinder
reasonably to provide. Although Pathfinder violated a state law
requirement that it consult a physician before authorizing discharge (it
did so later), the hearing officer found that the violation was merely a
form of harmless error in light of his own finding that Pathfinder was ill
equipped to care for Mr. Alexander properly. The hearing officer also
concluded that Pathfinder did not discharge Mr. Alexander as retribution
for Ms. Alexander's complaints regarding abuse. He found that despite the
disputes between Ms. Alexander and Pathfinder regarding behavior
modification plans and the taping of telephone calls, each had Mr.
Alexander's interests at heart. There was, he said, no scheme or plan by
Pathfinder to make life difficult for Ms. Alexander so that she would
voluntarily remove Mr. Alexander from Pathfinder's care.
Rather than appeal the administrative decision, the plaintiffs filed
a complaint in federal district court against Pathfinder, two Pathfinder
administrators, and Tom Dalton, Director of the Arkansas Department of
Human Services. Mr. Alexander asserted violations of his federal
constitutional rights under the first amendment, in addition to due process
and equal protection claims. He also raised claims under the Americans
with Disabilities Act (ADA), 42 U.S.C. § 12181 et seq., and section 504 of
the Rehabilitation Act of 1973, 29 U.S.C. § 794, as well as state-law tort
claims for invasion of privacy, assault, battery, intentional infliction
of emotional distress, and negligence. The due process claims included an
allegation that the state had failed to provide a competent hearing officer
to preside over the original
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administrative proceeding and that it had made time demands on the officer
that interfered with his ability to review the record and make a sound
decision. Ms. Alexander asserted violations of her first and fourteenth
amendment rights, which appear to amount to a claim that Pathfinder
retaliated against her by discharging Mr. Alexander because she exercised
her right of free speech by criticizing Pathfinder.
The district court reviewed University of Tennessee v. Elliott, 478
U.S. 788 (1986), and, after giving plaintiffs an opportunity to distinguish
its holding, found that they were estopped from litigating their claims in
federal court. The court analyzed the plaintiffs' claims under applicable
federal regulations, the ADA, and the Rehabilitation Act, finding that the
hearing officer's factfinding had necessarily resolved factual issues that
formed a predicate for those claims in favor of the defendants. Alexander
v. Pathfinder, Inc., 906 F. Supp. 502, 507-08 (E.D. Ark. 1995).
II.
The Alexanders have challenged the district court's preclusion
analysis. We begin with Mr. Alexander's claims.
Federal courts must give a state agency's findings of fact the same
preclusive effect that those findings would be entitled to in that state's
courts, provided that the agency was acting in a judicial capacity, the
questions litigated were properly before the agency judge, and the parties
had an adequate opportunity to litigate them. Elliott, 478 U.S. at 797-99;
Plough v. West Des Moines Community School Dist., 70 F.3d 512, 515-16 (8th
Cir. 1995). There is little doubt that all three of these predicates are
present here. The hearing officer considered a great deal of evidence in
the course of the hearing and rendered a written decision including
findings of fact and conclusions of law. The issue of the reasonableness
of the discharge was properly before
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the hearing officer because a hearing on that issue is provided for under
state law. See Ark. Code Ann. § 20-10-1005(a)(2). The parties had ample
chance to put on their proof over the course of a proceeding that lasted
six days and generated 1,400 pages of transcript and voluminous exhibits.
In Arkansas, issue preclusion bars relitigation of an issue of law
or fact that was litigated in the first suit when the issue sought to be
precluded is the same as that involved in the prior litigation, was
actually litigated, determined by a valid and final judgment, and its
determination was essential to the judgment. Crockett & Brown, P.A. v.
Wilson, 314 Ark. 578, 581, 864 S.W.2d 244, 246 (1993). Under Arkansas law,
an unappealed administrative decision is a final judgment. See Pine Bluff
Warehouse v. Berry, 51 Ark. App. 139, 142, 912 S.W.2d 11, 13 (1995). The
parties thoroughly litigated the issue of whether the discharge was for
medical reasons and good cause, and the hearing officer concluded that it
was.
As we have noted, the district court believed that the hearing
officer's factfinding necessarily precluded Mr. Alexander's ADA and
Rehabilitation Act claims. See Alexander v. Pathfinder, Inc., 906 F. Supp.
at 507-08. Mr. Alexander offers almost nothing to refute the district
court's conclusions in this regard. He makes no argument that the district
court's rejection of the ADA claim is unfounded (and we therefore do not
address it), and dedicates only one sentence to arguing that the hearing
officer's factfinding does not undermine his Rehabilition Act claim. The
Rehabilitation Act requires federally-funded programs to make reasonable
accommodations, not fundamental or substantial alterations in the nature
of the services that they provide. Alexander v. Choate, 469 U.S. 287, 299
(1985). The hearing officer's findings are replete with instances
revealing that Mr. Alexander required a much higher level of care than
Pathfinder could reasonably provide. The hearing officer concluded that
Mr. Alexander's "physical problems
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are many and interrelated. His weight problem, sleep apnea, reflux,
asthma, environmental allergies and Barrett's esophagitis -- when
considered in toto and in conjunction with his recent medical history --
pose unique daily living problems for which an ICF/MR is ill-equipped to
handle." We believe that the hearing officer's findings that caring for
Mr. Alexander was more than Pathfinder could reasonably be expected to do
rather clearly estops him from asserting a claim under the legal principles
outlined in the Rehabilitation Act.
We hold, however, that one of Mr. Alexander's federal claims was not
and could not have been litigated at the hearing, namely, the claim that
the state (in the person of Mr. Dalton) violated Mr. Alexander's due
process rights in failing to provide a competent hearing officer for the
administrative hearing and in making unreasonable demands on his time. By
hypothesis, the factual basis for this claim could not have been
adjudicated in the administrative hearing because the claim could not have
finally arisen until that hearing was concluded. The district court thus
inappropriately dismissed the claim against Mr. Dalton when it dismissed
the entirety of plaintiffs' case on the basis of preclusion. The district
court, moreover, never considered Mr. Dalton's separately-made arguments
for dismissal. We believe that the district court should pass on the
merits of Mr. Dalton's arguments in the first instance. See Moses v. Union
Pacific R.R., 64 F.3d 413, 419 (8th Cir. 1995).
The hearing officer made other factual findings that supported his
conclusion that Pathfinder discharged Mr. Alexander for medical reasons and
for good cause, namely, that Pathfinder did not harass Ms. Alexander to
make her remove her son from Pathfinder, and that the discharge was not in
retaliation for Ms. Alexander's complaints about her son's care. We
believe that these findings preclude further proceedings on Mr. Alexander's
state-law claim for the intentional infliction of emotional distress. The
hearing officer,
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however, made no findings that would appear at this point to preclude his
claims of invasion of privacy, assault, battery, and negligence. The
district court must therefore address these state law claims in some
fashion on remand.
III.
The complaint sets forth a retaliation claim brought by Ms. Alexander
individually. It appears that she took an active role in her son's case
and it is reasonable to treat her as a party to the administrative
adjudication as a "sponsor" of Mr. Alexander. See Ark. Code Ann. § 20-10-
1005(a)(2)(A). She raised and litigated her retaliation argument in an
effort to prove that Mr. Alexander's discharge was improper, and the
hearing officer made findings of fact and conclusions of law rejecting her
allegations. Hence, issue preclusion prevents her from litigating her
retaliation claim.
IV.
Ms. Alexander argues that the district court impermissibly granted
summary judgment when it dismissed the lawsuit on the basis of the
administrative decision. We find that the district court's use of
materials outside the pleadings in resolving to dismiss the complaint,
without converting the matter to summary judgment, was harmless error
because appellant had an adequate opportunity to respond to the
contemplated dismissal, and the existence of the administrative decision
was not disputed and it was part of the record. See Dorothy J. v. Little
Rock School Dist., 7 F.3d 729, 733 n. 3 (8th Cir. 1993); Gibb v. Scott, 958
F.2d 814, 816 (8th Cir. 1994). For the foregoing reasons, we affirm the
judgment of the district court in part, reverse it in part, and remand for
further proceedings consistent with this opinion.
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A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
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