Hawkins v . HHS CV-99-143-JD 01/23/04 P UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Cassandra Hawkins, et a l . v. Civil N o . 99-143-JD Opinion

Commissioner of the New Hampshire Department of Health and Human Services

O R D E R

The plaintiffs brought a civil rights suit as a proposed

class action in which they alleged that the New Hampshire

Department of Health and Human Services has failed to provide

Early and Periodic Screening, Diagnosis and Treatment

(“EPSDT”) dental services for which they were eligible under

Title XIX of the Social Security A c t ,

, et

seq. (the “Medicaid Act”). 1 Following years of litigation,

the parties have reached a settlement. The Joint Motion for

Preliminary Approval of Proposed Class Action Settlement was

granted on September 4 , 2003. The parties now seek final

1 The named plaintiffs are Cassandra Hawkins, Aimee Kent, and Laurie Tilton, each on behalf of her minor children, who are AJ Hawkins, Rachel Kent, Nicole Kent, Brian Kent, J r . , and Shania Tilton. The defendant is the Commissioner of the New Hampshire Department of Health and Human Services, who is sued in his official capacity. As such, the Department, rather than the Commissioner as an individual, is the defendant. See Kentucky v . Graham,

5 9 , 165 (1985). approval of the settlement.

“A class action shall not be dismissed or compromised

without the approval of the court.” Fed. R. Civ. P. 2 3 ( e ) .

Prior to addressing the proposed settlement, however, the

court must determine whether the plaintiff class, as agreed to

by the parties, may be certified for purposes of the settlement. Although the issue of class certification was

extensively litigated in the course of this suit, the parties

have now agreed to the certification of the following class

under Rules 23(a) and 23(b)(2): “all persons under age 21 who

are now enrolled, or who become enrolled during the term of

this Decree, in the New Hampshire Medicaid program and a r e , or

become, entitled to receive EPSDT dental services.”

I. Standing

“[N]amed plaintiffs who represent a class must allege and

show that they personally have been injured, not that injury

has been suffered by other, unidentified members of the class

to which they belong and which they purport to represent.”

Lewis v . Casey,

4 3 , 357 (1996) (internal quotation

marks omitted). Therefore, “prior to the certification of a

class, the district court must determine that at least one

named class representative has Article III standing to raise

each class [claim].” Prado-Steiman v . Bush,

,

2 1279-80 (11th Cir. 2 0 0 0 ) . Before the parties agreed to a settlement, the Department contested the standing of two of the three named plaintiffs to maintain their claims in this action, because their children were not eligible for Medicaid benefits at the time of the hearing on class certification. The Department did not challenge the standing of Laurie Tilton to bring the claims alleged in the Fourth Amended Complaint on behalf of her daughter, Shania Tilton, and nothing in the record demonstrates that Shania is not now eligible for Medicaid benefits or that her mother lacks standing to maintain the claims alleged in the complaint on behalf of her and the proposed class. The allegations in the complaint and the parties’ factual stipulations filed for purposes of considering class certification show that Laurie Tilton claims the Medicaid benefits for Shania that are also claimed on behalf of the class. Therefore, at least one of the named class representatives, Laurie Tilton, has standing to pursue the claims in this suit. 2

2 In addition, Aimee Kent has standing, despite her children’s current ineligibility for Medicaid, to pursue class certification, even if her claims on the merits are now moot. See U.S. Parole Comm’n v . Geraghty,

8 8 , 404 (1980); Grant v . Gilbert,

8 3 , 389-90 (5th Cir. 2 0 0 3 ) . Once a class is certified, the class has a legal status of its own that affects the standing analysis. See Birmingham Steel

3 II. Class Certification

To be certified for purposes of settlement, the proposed

class must meet the requirements of both Rule 23(a) and Rule

23(b)(2). See Amchem Prods., Inc. v . Windsor,

9 1 ,

613 (1997). When considering certification of a settlement

class, the court must pay “undiluted, even heightened”

attention to the provisions of Rule 23(a) and ( b ) , which are

“designed to protect absentees by blocking unwarranted or

overbroad class definitions.” Id. at 6 2 0 . The court need

not, however, “inquire whether the case, if tried, would

present intractable management problems . . . for the proposal

is that there be no trial.” Id.

The court does not “conduct a preliminary inquiry into

the merits of a suit” for purposes of determining whether to

certify a class. Eisen v . Carlisle & Jacquelin,

5 6 ,

177 (1974). Class certification may be decided on the

pleadings in some cases, but in others “it may be necessary

for the court to probe behind the pleadings before coming to

rest on the certification issue.” Gen. T e l . C o . of the

Southwest v . Falcon,

4 7 , 160 (1982). At the

certification stage, the court focuses on the requirements of

Corp. v . Tenn. Valley Auth.,

(11th Cir. Dec. 2 3 , 2 0 0 3 ) ; Payton v . County of Kane,

7 3 , 680-81 (7th Cir. 2 0 0 2 ) .

4 Rule 2 3 , and the factual issues raised by those requirements,

not on the merits of the plaintiffs’ claims. See Szabo v .

Bridgeport Mach., Inc.,

7 2 , 675-76 (7th Cir. 2 0 0 1 ) ;

Waste Mgmt. Holdings, Inc. v . Mowbray,

8 8 , 298 (1st

Cir. 2 0 0 0 ) .

A. Rule 23(a)

“The Rule 23(a) elements are ( 1 ) numerosity, ( 2 )

commonality, ( 3 ) typicality, and ( 4 ) adequacy of

representation.” Smilow v . Southwestern Bell Mobile S y s . ,

Inc.,

2 , 38 (1st Cir. 2003) (citing Amchem, 521 U.S.

at 6 1 3 ) . Numerosity requires that the class include so many

members that joinder would be impracticable. Fed. R. Civ. P.

23(a)(1). The commonality requirement is met if “there are

questions of law or fact common to the class.” Fed. R. Civ.

P. 23(a)(2). Typicality requires that the claims of the named

plaintiffs be typical of the claims of the class. Fed. R.

Civ. P. 23(a)(3). The representation is adequate if “the

representative parties will fairly and adequately protect the

interests of the class.” Fed. R. Civ. P. 23(a)(4).

1. Numerosity.

The evidence shows that in May of 2003, when the issue of

class certification was being litigated by the parties, more

5 than 55,000 children in New Hampshire were eligible for

Medicaid. Of those children, more than 12,000 were enrolled

in the Department of Health and Human Services’ voluntary

Medicaid managed care program and were eligible to receive

dental services through a prepaid dental benefit plan. As of

July 1 , 2003, those children were no longer eligible for the

dental plan and would have had to receive dental services

through the Medicaid fee-for-service program. From 1993

through at least June of 2003, fewer than forty-five percent

of the children enrolled in Medicaid received any dental

services reimbursed by Medicaid.

The Department does not contest the numerosity

requirement. The court is satisfied that the proposed class

is sufficiently large to meet the requirements of Rule

23(a)(1).

2 . Commonality and typicality.

The requirements of Rule 23(a)(2) and ( 3 ) are often

considered together. See Falcon,

n.13;

Bolanos v . Norwegian Cruise Lines, Ltd.,

4 4 , 155

(S.D.N.Y. 2 0 0 2 ) . “‘The crux of both requirements is to ensure

that maintenance of a class action is economical and that the

named plaintiff’s claim and the class claims are so

interrelated that the interests of the class members will be

6 fairly and adequately protected in their absence.’”

(quoting Marison A . v . Giuliani,

7 2 , 376 (2d Cir.

1997)). To satisfy the commonality requirement, the named

plaintiffs’ claims must share at least one common question of

law or fact with the class’s claims. S e e , e.g., Stanton v .

Boeing C o . ,

3 8 , 953 (9th Cir. 2 0 0 3 ) ; Collazo v .

Calderon,

3 7 , 442 (D.P.R. 2 0 0 2 ) . As long as the

claims of the named plaintiffs and the class “involve the same

conduct by the defendant, typicality is established regardless

of factual differences.” Johnson v . HBO Film Mgt., Inc.,

7 8 , 184 (3d Cir. 2 0 0 1 ) .

The named plaintiffs’ claims and the class claims are the

same in this case. They contend that the Department failed to

provide EPSDT services to children who were entitled to

receive those services under Medicaid. The Department did not

contest the typicality and commonality requirements with

respect to three of the claims in the complaint. As to the

claims for screening services, treatment, case management, and

scheduling or transportation assistance, however, the

Department asserted that those claims are not triggered unless

those services were requested and not provided. The

Department contended that plaintiff Laurie Tilton would not be

able to show that she requested services, as is required by

the applicable Medicaid statutes, so that her claim would fail

7 on the merits. Therefore, the Department argues, Tilton’s

claims do not satisfy the commonality or typicality requirements. 3

As is noted above, the court does not decide the elements

of Rule 23(a) by assessing the merits of the claims. Instead,

the court considers, in the context of this case, whether the named plaintiff has alleged claims that “due to the policies

and practices of the [defendant] in administering the system,

[she has] been, and will continue to b e , denied access to

Medicaid services. This common fact pattern gives rise to

common legal issues, alleging violations of the Medicaid Act

and its implementing regulations.” Rancourt v . Concannon,

4 , 16 ( D . M e . 2 0 0 2 ) ; see also Risinger v . Concannon,

6 , 19 ( D . M e . 2 0 0 1 ) . The plaintiffs’ allegations

satisfy the requirements of Rule 23 (a)(2) and ( 3 ) .

3. Adequacy of representation.

Representation is fair and adequate if the interests of

the named plaintiffs will not conflict with the interests of

the class and if counsel “is qualified, experienced and able

to vigorously conduct the proposed litigation.” Andrews v .

3 As noted above, Aimee Kent also has standing to pursue class certification.

8 Bechtel Power Corp.,

2 4 , 130 (1st Cir. 1 9 8 5 ) . Although the Department previously asserted that Laurie Tilton had a conflict with the class as to the transportation claim, the factual predicate asserted to show that conflict is not persuasive. Instead, it appears that Tilton, on behalf of her daughter, needed transportation services and employed extreme measures of self help in the absence of those services. The Department did not contest the qualifications of counsel from New Hampshire Legal Assistance (“NHLA”), who have represented the named plaintiffs in this action, and the court is satisfied that the representation is adequate. 4

B. Rule 23(b)(2)

A class may be certified under Rule 23(b)(2) if the

prerequisites of Rule 23(a) are satisfied and “the party

opposing the class has acted or refused to act on grounds

generally applicable to the class, thereby making appropriate

final injunctive relief or corresponding declaratory relief

with respect to the class as a whole.” Classes certified

under Rule 23(b)(2) “frequently serve as the vehicle for civil

4 NHLA has represented clients in state and federal court for many years. S e e , e.g., Laaman v . Warden,

(1st Cir. 2001) (giving history of class action litigation on behalf of prisoners and consent decree); Crowley v . Frazier,

(2001); Hynes v . Hale,

(2001).

9 rights actions and other institutional reform cases,”

including cases alleging deficiencies in government

administered programs such as Medicaid. Baby Neal v . Casey,

8 , 58-9 (3d Cir. 1 9 9 4 ) ; see also, e.g., Frew v .

Hawkins, 124 S . Ct 899 (U.S. 2 0 0 4 ) ; Doe v . Bush,

, 1051 (11th Cir. 2 0 0 1 ) ; M.A.C. v . Betit,

( D . Utah 2 0 0 3 ) ; Verdow v . Sutkowy,

0 9 ,

313 (N.D.N.Y. 2 0 0 2 ) ; Rancourt,

6 ; Carr v .

Wilson-Coker,

6 , 75 ( D . Conn. 2 0 0 1 ) ; Reynolds v .

Giuliani,

5 2 , 390-91 (S.D.N.Y. 2 0 0 0 ) .

The plaintiffs in this case allege that the Department’s

policies and practices have deprived their children, along

with all of the other children in the class, of dental

services in violation of the EPSDT provisions of Medicaid.

As such, the plaintiffs allege that the Department has acted

or refused to act on grounds generally applicable to the

class. The class may be maintained under Rule 23(b)(2). The

proposed class, “all persons under age 21 who are now

enrolled, or who become enrolled during the term of this

Decree, in the New Hampshire Medicaid program and a r e , or

become, entitled to receive EPSDT dental services,” meets the

requirements of both Rule 23(a) and (b)(2). Therefore the

class is certified for purposes of settlement.

III. Settlement

10 “A class action shall not be dismissed or compromised

without the approval of the court, and notice of the proposed

dismissal or compromise shall be given to all members of the

class in such manner as the court directs.” Fed. R. Civ. P.

23(e). Reasonable notice must be provided to class members to

allow them an opportunity to object to the proposed

settlement. See Durrett v . Hous. Auth. of the City of

Providence,

0 0 , 604 (1st Cir. 1 9 9 0 ) . “A district

court can approve a class action settlement only if it is

fair, adequate and reasonable.” City P’ship C o . v . A t l .

Acquisition Ltd. P’ship,

(1st Cir. 1 9 9 6 ) .

A hearing was held on December 1 5 , 2003, to address the

proposed settlement.

A. Notice

In response to the parties’ motion for preliminary

approval of their proposed settlement, the court ordered the

Department to provide notice of the proposed settlement by

posting a notice in its offices and mailing the notice to

class members advising of the parties’ intention to settle the

suit. The same notice was also to be published on at least

two occasions in newspapers published in Concord, Nashua,

Keene, Berlin, Grafton County, Dover, Littleton, and Coos

County. The Department has submitted evidence that it has

11 complied with the ordered notice requirements. NHLA also

represented at the hearing that counsel issued a joint press

release about the proposed settlement and that NHLA received

more than 200 calls in response. The notice provided,

therefore, more than complied with the court order.

B. Fair, Adequate, and Reasonable

In determining whether a proposed class settlement is

fair, adequate, and reasonable, the court undertakes a

detailed assessment of the terms of the settlement, the

interests of the class members as well as any third parties

that might be affected by the settlement, and the

circumstances of the litigation and the proposed settlement.

See Duhaime v . John Hancock Mut. Life I n s . C o . ,

, 2 ,

7 (1st Cir. 1 9 9 9 ) ; Durett, 896 F.2d at 6 0 4 . Because the

proposed class is mandatory under Rule 23(b)(2), the court

must review the proposal with heightened attention. Amchem,

521 U.S. at 6 2 0 .

Factors that will be considered in assessing the proposed

settlement are: ( 1 ) the complexity of the litigation, ( 2 ) the

posture of the case at the time settlement was proposed, ( 3 )

the extent of discovery conducted in the case, ( 4 ) the

circumstances of the settlement negotiations, ( 5 ) the

experience of counsel, ( 6 ) the relative strength of the

12 plaintiffs’ case on the merits, the possible defenses, and

other risks in the litigation, ( 7 ) the anticipated duration

and expense of further litigation, and ( 8 ) the reaction of the

class and opposition to the settlement. See In re Gen. Motors

Corp.,

6 8 , 785 (3d Cir. 1 9 9 5 ) ; Kovacs v . Ernst &

Young,

5 5 , 158 (4th Cir. 1 9 9 1 ) . A presumption in

favor of the proposed settlement arises when sufficient

discovery has been provided, counsel have experience in

similar cases, and the parties have bargained at arms-length.

City P’ship C o . ,

; Rolland v . Celluci,

, 6 ( D . Mass. 2 0 0 0 ) .

This case involved eight claims under the Medicaid A c t ,

to § 1396v., et seq., and the state’s

obligation to provide EPSDT services, in particular. At the

hearing, counsel for both sides reiterated the complexity of

the litigation and the extensive discovery that was undertaken

in this case. The case was thoroughly litigated from its

filing date in March of 1999, through motions practice,

discovery, and extensive mediation efforts. 5 More than thirty

depositions were taken; tens of thousands of pages were

5 In addition to the proceedings in this court, the plaintiffs brought a related action in state court under the right-to-know law, seeking access to Medicaid records kept by the New Hampshire Department of Health & Human Services. Hawkins v . N.H. Dep’t of Health & Human Servs.,

(2001).

13 requested and produced in discovery, and both sides issued

requests for admissions and multiple sets of interrogatories.

Both sides extensively briefed issues pertaining to class

certification, which involved four motions for certification

filed by the plaintiffs. A hearing was held before the magistrate judge on class certification, although the report

and recommendation as to certification had not yet issued when

the parties notified the court that they had agreed to a

settlement in August of 2003. The Department’s motion for

partial summary judgment was also pending at the time the

settlement was announced.

Counsel for the Department acknowledged at the hearing on

the proposed settlement that the plaintiffs’ claims raised

complex statutory issues and that at least some of the claims

would have gone to trial. Counsel estimated that the cost to

the state of going forward would have included $70,000 spent

for discovery and more than $100,000 spent for expert

witnesses. She also estimated that those costs would have

doubled if the case had gone to trial.

Counsel engaged in extensive negotiations for purposes of

settlement which began in the spring of 2001. They also

participated in mediation over an extended period. The

settlement required numerous drafts and discussions over a

14 long period of time.

The proposed consent decree requires the Department to

comply with federal law and lists statutes and regulations

pertaining to EPSDT services under Medicaid. The Department

is required to allocate $1.2 million each year in additional

state funds for the EPSDT dental program, which is believed to

be sufficient to allow the Department to meet its obligations

under the consent decree. The consent decree addresses the

Department’s obligations in detail and requires communication

between the Department and counsel for the plaintiffs for the

exchange of certain information and in the event of

circumstances that would require modification of the

obligations.

The consent decree provides that the court will retain

jurisdiction over the action for five years from the final

order approving the settlement and then for a sixth year to

determine compliance during the previous five years. In

addition, counsel for the plaintiffs is allowed to monitor the

Department’s compliance with the terms of the decree and is

allowed reasonable attorneys’ fees for those efforts. If

counsel for the plaintiffs contends that the Department is not

in compliance, the parties will first meet and attempt to

negotiate the issues and will ask for court intervention only

if their own efforts fail.

15 The court received only three letters in response to the

notice of the proposed settlement. Only two of those letters

were objections. One letter objected to more money being

spent on Medicaid services, and the other letter objected to

the suit on the grounds that the writer had not experienced

deficiencies and money should not be spent on lawsuits.

Neither letter suggested that the settlement proposed in this

case is not fair, adequate, and reasonable for the class

members.

At the hearing, Isabelle Diaz, who is a member of the

class certified in this case, testified about the difficulties

she has experienced in obtaining Medicaid dental services for

her children. Although M r s . Diaz is Spanish-speaking, she was

able to communicate with the court through her young bilingual

son and one of the NHLA attorneys. The consent decree in this

case provides exactly the kind of services and assistance that

M r s . Diaz testified she lacks and needs to have in order to

access dental services for her children.

Having reviewed the consent decree proposed by the

parties as the settlement of this class action in light of the

various considerations used to evaluate class action

settlements, the court is satisfied that the consent decree is

a fair, adequate, and reasonable settlement of this case.

16 Conclusion

For the foregoing reasons, the parties’ joint motion for

final approval of the proposed class action settlement

(document n o . 209) is granted, and the consent decree

submitted with the motion for preliminary approval (document

n o . 205) has been approved and signed on this date.

The parties have indicated that they will resolve the

issue of attorneys’ fees.

Although the court will retain jurisdiction as provided

in the consent decree, no further action is now required in

this case. Therefore, the case will be closed.

SO ORDERED.

Joseph A . DiClerico, J r . United States District Judge January 2 3 , 2004

cc: Kenneth J. Barnes, Esquire Kay E . Drought, Esquire Mary E . Schwarzer, Esquire

17