Rena C. v. Colonial School District , 890 F.3d 404 ( 2018 )

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
______
No. 17-1161
______
RENA C.,
Appellant
v.
COLONIAL SCHOOL DISTRICT
______
On Appeal from the United States District Court
for the Eastern District of Pennsylvania
(E.D. Pa. No. 2-15-cv-01914)
District Judge: Honorable Timothy J. Savage
______
Argued October 23, 2017
Before: GREENAWAY JR., NYGAARD and FISHER,
Circuit Judges.
(Filed: May 14, 2018)
David J. Berney, Esq. [ARGUED]
1628 John F. Kennedy Boulevard
8 Penn Center Plaza, Suite 1000
Philadelphia, PA 19103
Counsel for Appellant
Ellen M. Saideman, Esq.
7 Henry Drive
Barrington, RI 02806
Counsel for Amicus Appellant
Karl A. Romberger, Jr., Esq. [ARGUED]
Sweet Stevens Katz & Williams
331 East Butler Avenue
P.O. Box 5069
New Britain, PA 18901
Counsel for Appellee
Emily J. Leader, Esq.
Pennsylvania School Boards Association
400 Bent Creek Boulevard
P.O. Box 2042
Mechanicsburg, PA 17055
2
Sarah B. Dragotta, Esq.
Kevin M. McKenna, Esq.
Nicole D. Snyder, Esq.
Latsha Davis & McKenna
350 Eagleview Boulevard, Suite 100
Exton, PA 19341
Counsel for Amicus Appellees
______
OPINION OF THE COURT
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FISHER, Circuit Judge.
This case arises out of a dispute under the Individuals
with Disabilities Education Act (“IDEA”). Under the IDEA,
when parents and school districts dispute a child’s
educational placement, a parent may file an administrative
due process complaint that can lead to an administrative
hearing. At least ten days before the dispute reaches a
hearing, the school district can extend a settlement offer to the
parent, referred to herein as a “ten-day offer.” If the matter
proceeds to a hearing and the parent is the prevailing party,
this ten-day offer becomes significant. A parent who is the
prevailing party may be awarded reasonable attorney’s fees
under the IDEA, but the ten-day offer allows a school district
to limit its exposure to such fees by limiting a parent’s
eligibility for attorney’s fees to only those fees accrued before
the time of the ten-day offer. If a parent rejects the ten-day
3
offer, the parent may only receive attorney’s fees for work
done after the time of the offer if (1) the hearing leads to more
favorable relief than the offer included, or (2) the parent was
substantially justified in rejecting the offer.
In the instant matter, Rena C., mother to student A.D.,
filed an administrative due process complaint against the
Colonial School District to determine an appropriate
placement for her daughter. In an effort to limit the accrual of
owed attorney’s fees, Colonial extended Rena C. what it
contends was a ten-day offer. Rena C. rejected the offer.
When the matter eventually proceeded to a hearing, an
administrative officer entered an order in favor of Rena C.,
ordering a private school placement for the student. As the
prevailing party, Rena C. then filed a claim for attorney’s fees
in the District Court. This appeal concerns whether or not
Colonial successfully limited Rena C.’s eligibility for
attorney’s fees with its offer. Because Rena C. was the
prevailing party, the District Court awarded her attorney’s
fees for work performed prior to the ten-day offer. However,
the District Court held that because she did not receive more
favorable relief and was not substantially justified in rejecting
the offer, she was not entitled to fees accrued after Colonial’s
offer. We disagree and hold that Rena C. was substantially
justified in rejecting Colonial School District’s offer. We will
reverse and remand to the District Court for recalculation of
attorney’s fees.
4
I.
Rena C.’s child, A.D., attended public school in the
Colonial School District. The instant matter was not the first
placement dispute between Rena C. and Colonial. Prior to this
matter, when A.D. was entering seventh grade, Rena C.
unilaterally pulled A.D. from the public school she had been
attending and enrolled her at the Stratford Friends School.
Rena C. claimed that Colonial had failed to provide a free,
appropriate public education as required by the IDEA and
sought reimbursement from Colonial. The matter went to an
administrative hearing officer who found that A.D.’s
Individualized Education Program (IEP) at Colonial was
inappropriate and that the placement at Stratford was
appropriate. The hearing officer awarded Rena C. two years
of compensatory education, tuition reimbursement for the
current school year, and ongoing tuition reimbursement until
Colonial convened an appropriate IEP meeting.
The following school year, for A.D.’s eighth grade
year, Rena C. again enrolled her at Stratford. Colonial
convened an IEP meeting at the end of that school year. Rena
C. disputed the adequacy of the IEP and requested mediation,
thus beginning the dispute underlying this appeal. At the end
of the summer, Rena C. notified Colonial that she intended to
enroll A.D. at Delaware Valley Friends School for the next
school year and requested reimbursement for tuition and
related expenses. Colonial responded that the new IEP
placing A.D. at the public school was adequate and that it
therefore was not required to further reimburse Rena C. for
any educational expenses. Rena C. then cancelled the
mediation she had requested and filed an administrative
complaint challenging the adequacy of the IEP. She sought
declaratory relief and “reimbursement for private tuition and
associated costs (‘tuition reimbursement’) arising from
5
[A.D.]’s private placements for the [previous] school year and
the [upcoming] school year.” App. 45. Rena C. received a
tuition bill from Delaware Valley on the same day she filed
her administrative complaint. The invoice shows two separate
educational expenses: $36,300 for tuition and $10,800 for
one-on-one educational support.
On September 18, 2014, Colonial sent Rena C. what
it contends was a ten-day offer pursuant to 20 U.S.C. §
1415(i)(3)(D)(i)(I)-(III). In this letter, Colonial offered “to
pay private school tuition and transportation for Parent’s
unilateral placement at Delaware Valley Friends School.”
App. 49. Rena C. did not respond to this letter for over a
month. She eventually claimed that it did not constitute a
valid offer because it lacked school board approval, and that it
was inadequate for failing to address attorney’s fees or
pendency.1
The parties attempted negotiation, but eventually
proceeded to an administrative hearing. After the first session
of the hearing concluded, the parties participated in mediation
with the assistance of a secondary administrative hearing
officer. Subsequently, the parties stipulated to a consent order
entered by an administrative hearing officer providing for
tuition, one-on-one instructional support, transportation
reimbursement, and pendency at Delaware Valley. The order
did not include attorney’s fees.
Rena C. filed a complaint in the Eastern District of
Pennsylvania seeking approximately $70,000 in attorney’s
fees under the IDEA, the Americans with Disabilities Act
(ADA), and § 504 of the Rehabilitation Act. Colonial
1
Under the IDEA, pendency refers to the educational
placement in which a student has the right to “stay-put”
during a placement dispute.
6
counterclaimed for attorney’s fees under 20 U.S.C. §
1415(i)(3)(B)(i)(II) and (III), alleging that Rena C. continued
to litigate after the litigation had become frivolous,
unreasonable, or without foundation, thereby needlessly
increasing the cost of litigation.
The District Court granted Rena C.’s motion for
summary judgment on her claim for attorney’s fees, but
awarded her only $7,438.00. This figure included only those
attorney’s fees accrued before the school district made its ten-
day offer. She was not awarded any fees accrued after the
school district made its ten-day offer because the court found
that she did not receive more favorable relief during the
subsequent proceedings, and that she was not substantially
justified in rejecting the offer. The District Court granted in
part and denied in part Colonial’s motion for summary
judgment, rejecting its argument that the school district was a
prevailing party, but agreeing that Rena C. was not entitled to
fees for post-offer work. The District Court rejected
Colonial’s counterclaim because Colonial was not the
prevailing party. 2
2
The order filed by the District Court in response to
Rena C.’s motion for summary judgment on Colonial’s
counterclaim says that the motion was denied, but the opinion
of the District Court makes clear that the court held that
Colonial could not receive fees because it was not a
prevailing party. Therefore, we regard the order as a clerical
error and regard the opinion as disposing of Colonial’s
counterclaim.
7
II.
The District Court exercised jurisdiction under 28
U.S.C. § 1331 and 1343. This Court exercises jurisdiction
under 28 U.S.C. § 1291. We apply plenary review to legal
questions related to the interpretation of ten-day offers and to
questions of construction regarding such offers under the
IDEA. This standard is consistent with this Court’s standard
of review for rulings on attorney’s fees, and with its standard
of review for Federal Rule of Civil Procedure 68 offers of
judgment. See M.R. v. Ridley School District (Ridley II), 868
F.3d 218, 223 (3d Cir. 2017) (“Although ordinarily we review
attorneys’ fees rulings for abuse of discretion, our review is
plenary where, as here, the district court based its denial on
legal conclusions.”); Le v. University of Pennsylvania, 321
F.3d 403, 406 (3d Cir. 2003) (exercising “plenary review over
both legal questions regarding the interpretation of Rule 68
and the construction of the offer of judgment”).
III.
Rena C. makes five alternative arguments on appeal as
to why she is entitled to recover attorney’s fees accrued after
Colonial’s September 18, 2014 offer. First, she argues that
Colonial did not make a valid offer of settlement pursuant to
20 U.S.C. § 1415(i)(3)(D)(i). We conclude that it did. Second,
she argues that she received more favorable relief in the
administrative order than Colonial had included in the ten-day
offer. We conclude that she did not. Third, she argues that she
was substantially justified in rejecting the offer. We agree.
Fourth, she argues that she was entitled to fees under the
ADA and § 504 even if she was precluded under the IDEA,
and fifth, she argues that she was separately entitled to fees
for her defense of Colonial’s counterclaim. We decline to
reach these issues. Because the IDEA did not preclude fees,
we need not address these alternative statutory arguments.
8
A) Colonial School District made a valid offer of
settlement pursuant to 20 U.S.C. § 1415.
Rena C. argues that Colonial did not make a valid ten-
day offer because the school board had not yet approved it.
Neither Pennsylvania law nor the IDEA, however, required
Colonial to secure school board approval prior to extending a
ten-day offer of settlement under 20 U.S.C. § 1415.
Pennsylvania law requires the affirmative vote of the majority
of the members of a board of school directors to take any
action, inter alia, “[c]reating or increasing any indebtedness”
or “[e]ntering into contracts of any kind, including contracts
for the purchase of fuel or any supplies, where the amount
involved exceeds one hundred dollars ($100).” 24 P.S. § 5-
508. This state statute might require school board approval
before a completed settlement agreement for more than one
hundred dollars can be enforced, but the text of the provision
lacks any indication that it prohibits school boards from doing
what Colonial did here: authorizing an agent, such as an
attorney, to negotiate a contract on its behalf. And Rena C.
points to no cases applying § 5-508 to IDEA ten-day offers.
On its face, 20 U.S.C. § 1415(i)(3)(D)(i) requires only that
the ten-day offer be a “written offer of settlement.” Colonial’s
offer to Rena C. was exactly that—an offer of settlement in
writing.
The IDEA has been interpreted to promote the speedy
resolution of disputes between parents and school districts. El
Paso Independent Sch. Dist. v. Richard R., 591 F.3d 417, 426
(5th Cir. 2009) (“Early resolution through settlement is
favored under the IDEA.”). Interpreting § 5-508 to require
school board approval before a ten-day offer could be valid
under the IDEA would undermine the IDEA’s goal of
9
promoting speedy resolutions of placement disputes. The
broad terms of the IDEA provide a framework that is flexible
enough to apply to a multitude of different jurisdictions and
school districts, each with its own policies and procedures.
The clear wording of the IDEA requires only a “written offer
of settlement” and § 5-508 does not provide a basis for
requiring Colonial to have done more in order to make a valid
ten-day offer satisfying the IDEA. We therefore hold that
Colonial made a valid ten-day offer under the IDEA to Rena
C.
B) Rena C. did not receive more favorable relief in the
administrative officer’s order than she had been
offered in Colonial’s ten-day offer.
The IDEA provides for an award of reasonable
attorney’s fees to a prevailing party who is the parent of a
child with a disability. 20 U.S.C. § 1415(i)(3)(B)(i)(I).
However, a parent may not receive attorney’s fees “for
services performed subsequent to the time of a written offer
of settlement to a parent” if: (1) the offer is made more than
ten days before the proceeding begins; (2) the offer is not
accepted within ten days; and (3) the court or administrative
hearing officer finds that the relief finally obtained by the
parents is not more favorable to the parents than the offer of
settlement.” Id. § 1415(i)(3)(D)(i).
Colonial provided the settlement offer more than ten
days before the proceeding began. Rena C. never sent any
response, thereby rejecting the offer. The District Court found
that the relief ultimately obtained by Rena C. was not more
favorable than the settlement offer. We agree, finding that the
20 U.S.C. § 1415(i)(3)(D)(i) bar applies.
Rena C.’s administrative complaint requested two
items of relief. First, she sought “reimbursement for private
10
tuition and associated costs (tuition reimbursement)” for two
school years. App. 43. Second, she requested declaratory
relief in the form of an adjudication that her child’s rights
under the IDEA, the ADA, and § 504 had been violated. In its
ten-day offer, Colonial offered “to pay private school tuition
and transportation for Parent’s unilateral placement at
Delaware Valley Friends School.” App. 49. The
administrative officer’s order provided for tuition, one-on-one
instructional support, transportation reimbursement, and
pendency at Delaware Valley.
Rena C. argues that the explicit inclusion of one-on-
one instruction and pendency rendered the final order more
favorable than the ten-day offer. This is incorrect because the
terms of the ten-day offer already included these items.
1. Colonial’s offer to pay tuition included the
cost of one-on-one instruction.
Although the administrative officer’s order explicitly
indicated that one-on-one instruction was included (while the
ten-day offer did not), the enumeration of this item did not
constitute more favorable relief. The District Court correctly
concluded that Colonial’s offer to pay tuition necessarily
included an offer to pay for one-on-one instruction.
Rena C.’s due process complaint sought
“reimbursement for private tuition and associated costs
(‘tuition reimbursement’) arising from [student’s] private
placements for the 2013-2014 school year and the 2014-2015
school year.” App. 45. On the same day that she filed her
complaint, Delaware Valley sent an invoice to Rena C for the
“2014-2015 Tuition for A.D.” containing two line items:
$36,300 for tuition and $10,800 for “Language Arts One-on-
One” for a total due of $47,100. Rena C. did not share this
invoice with Colonial before the ten-day offer letter was sent.
11
The ten-day offer letter offered “private school tuition and
transportation.” App. 49. The District Court correctly
concluded that Colonial offered to pay the tuition bill from
Delaware Valley for the 2014-2015 school year, which
necessarily included the one-on-one instruction.
Colonial cannot be penalized for not specifically
including the cost of one-on-one instruction when Rena C.
never informed Colonial that this charge was annotated
separately as part of Delaware Valley’s tuition invoice.
Merriam-Webster defines “tuition” as “the price of or
payment for instruction.” Webster’s Third New International
Dictionary, 2461 (1993). The Random House Dictionary
defines tuition as “the charge or fee for instruction as at a
private school or a college or university.” Random House
Dictionary of the English Language, 2034 (2d Ed. 1987).
Based on the language contained in Rena C.’s complaint and
the dictionary definitions, Colonial’s offer to pay “private
school tuition” included the cost of one-on-one instruction.
When the hearing officer ordered Colonial to “pay private
school tuition” and specified that tuition included one-on-one
instruction, the hearing officer did not provide greater relief
than Colonial’s ten-day offer to “pay private school tuition.”
The hearing officer simply knew the additional fact that the
one-on-one instruction was a separately annotated cost in the
bill for tuition.
Rena C. argues that it was ambiguous whether one-on-
one instruction was included in Colonial’s offer and that this
ambiguity should have been construed against Colonial, both
because Colonial was the drafter, and because Colonial was
the moving party at the summary judgment stage. Rena C. is
correct that any ambiguity would have been construed against
Colonial had she agreed to the offer and then Colonial refused
to pay. However, this is not a contract enforcement case.
12
Rena C. cannot inject ambiguity into a clear offer to pay
private school tuition by withholding information about the
particular billing conventions of the private school. Had Rena
C. been unsure whether Colonial’s offer included the cost of
one-on-one instruction, she could have clarified with them.
Unlike Rule 68 offers of judgment, IDEA ten-day offers are
not required to be non-negotiable. Ten-day offers may be
clarified by parents. See Beauchamp v. Anaheim Union High
Sch. Dist., 816 F.3d 1216, 1223 (9th Cir. 2016).
Additionally, Rena C.’s contention that the District
Court erred in applying the summary judgment standard by
not resolving the issue of whether one-on-one instruction was
included in tuition in Rena C.’s favor fails. Whether “tuition”
in the ten-day offer included the cost of one-on-one-
instruction is a legal question regarding the construction of
the offer, not a factual question that should be resolved in
favor of the nonmoving party at the summary judgment stage.
2. Colonial’s offer to pay tuition at a private
school placement would have created pendency
at the private school and triggered the student’s
“stay-put” rights at the private school.
Pendency refers to a student’s rights under the IDEA
to “stay-put” in the current educational placement. The “stay-
put” provision requires that “during the pendency of any
proceedings conducted pursuant to this section, unless the
State or local educational agency and the parents otherwise
agree, the child shall remain in the then-current educational
placement of the child.” 20 U.S.C. § 1415(j). This requires
the school district to continue to pay for the “then-current
educational placement” during the pendency of proceedings
resolving placement disputes. Drinker by Drinker v. Colonial
13
Sch. Dist., 78 F.3d 859, 865 (3d Cir. 1996).
The ten-day offer did not mention pendency explicitly,
but the subsequent administrative order included the
statement that “[b]y the parties’ agreement, pendency shall be
at Delaware Valley Friends School.” App. 127. Rena C.
contends that this sentence provided more favorable relief
than ten-day offer. Colonial contends that although the ten-
day offer letter did not specifically state that pendency would
attach at Delaware Valley, pendency would have attached had
Rena C. accepted their offer because Delaware Valley would
have automatically become A.D.’s “then-current placement.”
This issue turns on whether Rena C.’s acceptance of
the ten-day offer would have made Delaware Valley A.D.’s
“then-current educational placement,” vesting her with “stay-
put” rights should any dispute over placement arise in the
future. This Court has held that “[b]ecause [then-current]
connotes preservation of the status quo, it refers to the
operative placement actually functioning at the time the
dispute first arises.” Drinker, 78 F.3d at 867 (quoting Thomas
v. Cincinnati Bd. of Educ., 918 F.2d 618, 625–26 (6th Cir.
1990)). Under this Court’s precedent, “the dispositive factor
in deciding a child’s ‘current educational placement’ should
be the Individualized Education Program (‘IEP’) actually
functioning when the ‘stay put’ is invoked.” Drinker, 78 F.3d
at 867 (citation omitted).
This provision “reflect[s] Congress’s conclusion that a
child with a disability is best served by maintaining her
educational status quo until the disagreement over her IEP is
resolved.” M.R. v. Ridley School Dist. (Ridley I), 744 F.3d
112, 118 (3d Cir. 2014). A student’s “operative placement
could be either a public school or a private school that the
local district was financing to satisfy the requirement that
14
every child be given a free, appropriate education.” Id.“Stay-put” rights do not attach when a parent
unilaterally moves a child to a new placement. However,
“[t]he new placement can become the educational setting
protected by the “stay-put” rule if the parents and ‘the State or
local educational agency’ agree to the change.” Id. at 118–19.
The State is considered to have agreed to the change when an
administrative review process yields a decision approving of
the parent’s unilateral placement. Id. at 119. Once an
administrative ruling validates the parents’ decision to move
the child to a new placement, “the move to private school is
no longer the parents’ unilateral action, and the child is
entitled to ‘stay put’ at the private school for the duration of
the dispute resolution proceedings.” Id.This Court has not squarely addressed whether a
school district’s private agreement to pay for a parent’s
unilateral private school placement constitutes an agreement
to the placement. We now hold that by agreeing, without
limitations, to pay tuition at a private school, the school
district, as the local educational agency, agrees that the
private school placement is appropriate and that paying
tuition there fulfills its obligation to provide a free and
appropriate public education. When parents and a local
educational agency agree on a placement without limitations,
that placement becomes the educational setting protected by
the “stay-put” provision of 20 U.S.C. 1415(j). Had Rena C.
accepted Colonial’s offer, A.D.’s “stay-put” rights would
15
have attached at Delaware Valley.3
Rena C. argues that the District Court’s conclusion that
“stay-put” rights would attach was not supported by law
because a school district’s financial responsibility for a
student’s placement is not equivalent to agreement by the
district to the placement. To support this argument, Rena C.
cites Lauren W. v. Bd. of Educ., No. 02-4775, 2002 U.S. Dist.
LEXIS 18303, (E.D. Pa. Sept. 12, 2002) and K.L. v. Berlin
Borough Bd. of Educ., No. 13-4215, 2013 U.S. Dist. LEXIS
111047 (D.N.J. Aug. 7, 2013). Neither of these cases is
controlling and neither addresses the scenario presented in
3
We recognize that our law regarding implied
pendency in ten-day offers was not settled during the events
giving rise to this litigation. Rena C. argued that she had a
good faith basis for declining Colonial’s offer, and other
courts have held that good faith arguments can qualify as
substantial justification for rejecting ten-day offers under the
IDEA. See B.L. v. District of Columbia, 517 F. Supp. 2d 57,
61 (D.D.C. 2007) (holding parents substantially justified in
rejecting an offer that did not include expert costs because, at
the time of the offer, “it was by no means settled law that
expert costs could not be recovered” and only an intervening
Supreme Court decision had made clear that the parents’
rejection lacked legal basis); R.N. v. Suffield Bd. of Educ., 194
F.R.D. 49, 53 (D. Conn. 2000) (holding parents’ rejection
substantially justified because they were acting based on split
of authority within district). However, as we will explain
below, we conclude here that Rena C. was substantially
justified in rejecting Colonial’s offer for a different reason:
because it did not include attorney’s fees. Thus, we need not
reach the issue of whether a good faith argument rooted in
unsettled law can qualify as substantial justification.
16
this case.
In Lauren W., the settlement specifically stipulated that
pendency would not attach to the parents’ unilateral school
placement. 2002 U.S. Dist. LEXIS 18303 at *9. However,
once the school board voted to pay for tuition at that
placement beyond the terms of the settlement, pendency did
attach. Id. at *10. In K.L., again, the settlement stipulated that
the question of pendency was still disputed by the parties and
was unaffected by the agreement. 2013 U.S. Dist. LEXIS
111047 at *12–13. The district court there concluded that the
settlement agreement only pertained to reimbursement and
did not constitute an agreement on appropriate placement. Id.Unlike those cases, Colonial’s offer here included no specific
limitations on pendency.
Without any limitations attached, a school district’s
agreement to pay for private school tuition constitutes an
agreement to placement and triggers the student’s “stay-put”
rights. For this reason, the explicit inclusion of pendency in
the order does not create a more favorable outcome than the
ten-day offer.
Rena C. did not receive more favorable relief in the
final order than she was offered by Colonial in the ten-day
offer. The bar of 20 U.S.C. § 1415(i)(3)(D)(i) therefore
applies and she is prevented from receiving attorney’s fees
“for services performed subsequent to the time of a written
offer of settlement,” unless she was substantially justified in
rejecting Colonial’s offer. 20 U.S.C. § 1415(i)(3)(D)(i); see
id. § 1415(i)(3)(E).
C) Rena C. was substantially justified in rejecting
Colonial’s ten-day offer letter.
Under 20 U.S.C. § 1415(i)(3)(E), Rena C. may still be
eligible for post-offer attorney’s fees, even though she did not
17
receive more favorable relief, if she was substantially justified
in rejecting Colonial’s ten-day offer. Rena C. identifies three
reasons why she was substantially justified in rejecting the
ten-day offer. First, the offer did not include attorney’s fees
and costs. Second, the offer was vague. Third, she had a good
faith basis for believing that the offer did not include the cost
of one-on-one instruction, pendency, or attorney’s fees and
costs. The District Court rejected these three arguments,
concluding that she was not substantially justified in rejecting
the offer. We hold that the absence of attorney’s fees
provided Rena C. with substantial justification for rejecting
the offer. Given that holding, we will not reach her vagueness
or good faith arguments.
The Third Circuit, like most other circuits, has not
defined the standard for determining whether a parent was
substantially justified under the IDEA in rejecting a
settlement offer. See Beauchamp, 816 F.3d at 1222 (“There is
little precedent interpreting the phrase ‘substantially
justified’”). Case law from district courts and at least one
circuit court offers a somewhat scattered picture in the
context of attorney’s fees.
1. Attorney’s fees are relevant to the ten-day
offer.
The IDEA does not require a school district to include
attorney’s fees in ten-day offers to parents. To obtain
attorney’s fees in court, parents must be the prevailing party
with a judgment on the merits, or a court-ordered consent
decree that creates a “material alteration of the legal
relationship.” Buckhannon Bd. & Care Home, Inc. v. W.
Virginia Dep't of Health & Human Res., 532 U.S. 598, 604
(2001).
Colonial argues that attorney’s fees, as a collateral
18
matter, are irrelevant in the context of a ten-day offer because
they are not part of the available relief for parents at an
administrative hearing. This argument ignores the fact that
relief granted at an administrative hearing creates the
condition necessary for parents to seek attorney’s fees.
Without pursuing the administrative hearing, a parent cannot
achieve the prevailing party status necessary to claim
attorney’s fees. See id.; P.N. v. Clementon Bd. of Educ., 442
F.3d 848, 855–857 (3d Cir. 2006). The District Court
correctly disposed of this argument by recognizing that had
Rena C. accepted the ten-day offer, the parties would have
created a non-judicially sanctioned agreement, and neither
party would be considered the prevailing party, so Rena C.
would have no path to recover attorney’s fees. Attorney’s fees
are therefore relevant to a ten-day offer.
2. Colonial’s offer did not include attorney’s
fees.
The District Court found that the ten-day offer
included an offer to pay attorney’s fees, so Rena C. was not
substantially justified in rejecting the offer. The letter stated:
“This offer does not imply that the School District
acknowledges any liability in this matter whatsoever; rather,
it is an attempt to achieve an amicable resolution. This offer
is also being made in order to further limit the School
District’s possible prevailing party attorney fee liability.”
App. 49. The District Court held that, because “Colonial
explained it was making the offer to ‘further limit’ exposure
to attorney’s fees, [it] implicitly acknolwedg[ed] it would pay
attorney’s fees incurred to date.” App. 20.
In interpreting this offer, we must focus on its plain
language. See Lima v. Newark Police Dep’t., 658 F.3d 324,
331 (3d Cir. 2011). The plain language does not indicate that
19
Colonial offered to pay any amount of attorney’s fees, but
rather that it wished to avoid them. The District Court erred
because the language of the offer makes clear that Colonial
believed its liability for attorney’s fees would only arise if
Rena C. were the prevailing party. Had Rena C. accepted the
offer, she would not be the prevailing party. For this reason,
the District Court erred in concluding that the ten-day offer
letter included attorney’s fees. Had Colonial intended to
include attorney’s fees in its offer, it had the burden to state
that the offer included payment of attorney’s fees accrued up
until that point. See id. (holding that the district court erred in
concluding that Rule 68 offer of judgment included attorney’s
fees because the offer “did not explicitly include attorney’s
fees or costs).4
3. A ten-day offer that affords no attorney’s
fees provides a parent with substantial
justification to reject the offer when the
school district could not rationally believe
that attorney’s fees had not accrued.
The IDEA provides for attorney’s fees so that parents
may seek assistance when necessary to protect their child’s
right to a free, appropriate public education. Ten-day offer
letters should not permit school boards to force parents to
choose between securing an appropriate placement for their
child and obtaining the attorney’s fees to which they would
4
Additionally, the District Court erred in considering
that after the ten-day offer had lapsed, Colonial made a
separate, explicit offer to pay reasonable attorney’s fees
because that evidence is extrinsic and cannot be used to
interpret the offer.
20
otherwise be statutorily entitled.
There is no controlling case law in this Circuit
regarding whether or not the absence of attorney’s fees
provides substantial justification for rejecting a ten-day offer.
There is varied case law among the district courts and the
Fifth Circuit regarding this question.
The District Court for the District of Columbia
provided compelling reasoning in Daniel v. District of
Columbia for considering the absence of attorney’s fees in an
offer as substantial justification for rejection by the parents.
174 F. Supp. 3d 532, 546 (D.D.C. 2016). There, the court
explained that “[p]arents or guardians of children with special
needs should not have to choose between a District offer of
special education services for those children on the one hand,
and continuing to pursue litigation so that their counsel who
caused DCPS to make the offer in the first place may obtain
some measure of reasonable compensation.” Id. The court in
Daniel reasoned that the school district could not rationally
believe that the parents had not accrued attorney’s fees before
the time of its offer. Id. at 545. In another case, the same
district court stated that “Congress included the [IDEA] fee-
shifting provision so that all children and their families would
be able to enforce the child’s right to a free and appropriate
public education, regardless of financial means.” Garvin v.
Gov’t of D.C., 910 F. Supp. 2d 135, 138 (D.D.C. 2012). In
Dicks v. District of Columbia, the court found parents
substantially justified in rejecting an offer that only included
attorney’s fees for 1.2 hours when the attorney had worked
approximately 33 hours. 109 F. Supp. 3d 126, 131 (D.D.C.
2015) (“A settlement offer that compensates counsel for a
mere fraction [of] its efforts deters parents from exercising
their due process rights and, as such, is inimical to the
IDEA’s purpose.”).
21
In contrast, the Fifth Circuit held that the absence of
attorney’s fees in a settlement offer did not substantially
justify the parent’s rejection. Gary G. v. El Paso Indep. Sch.
Dist., 632 F.3d 201, 210 (5th Cir. 2011). The offer in that
case had been extended to the parent before the parent filed a
due process complaint, and before the school district learned
that the parent was represented by an attorney. Though the
attorney in that case had recorded 13.8 hours of work through
the date of the settlement offer, the school district was not
even aware of the due process complaint, let alone the
attorney’s involvement when it extended a written settlement
offer. Id. at 204. On those facts, the court held that because
the amount of fees claimed was so low, their omission did not
establish substantial justification to reject the offer. The court
there noted that it did “not hold that every plaintiff rejecting a
settlement offer because it does not include such fees is, per
se, not substantially justified in rejecting it.” Id. Rena C.’s
case can be distinguished from Gary G. because here the due
process complaint had been filed and Colonial certainly knew
that an attorney was involved and that attorney’s fees had
accrued when it extended its ten-day offer.
This Circuit has recognized that “the IDEA’s
legislative history reflects that Congress enacted the
attorney’s fees provision specifically to ensure ‘that due
process procedures, including the right to litigation if that
becomes necessary, are available to all parents.’” Ridley II,
868 F.3d at 227 (alterations omitted) (quoting S. Rep. No. 99-
112, at 2 (1985)). The ten-day offer provision in the IDEA
facilitates efficient resolutions of disputes between parents
and school districts over placement and seeks to obviate the
need for a due process hearing. Still, the ten-day offer is often
extended after a parent has hired an attorney to assist them in
asserting their child’s rights.
22
We do not read the IDEA to force parents to decide
between the resolution of a placement dispute and paying for
the attorney who assisted in achieving an appropriate
placement for the student. A school district seeking to settle a
dispute in which a lawyer has been involved should
acknowledge that the parent has accrued attorney’s fees and
should clearly state if its offer includes the payment of any
fees. A parent is substantially justified in rejecting an offer
that does not include the payment of reasonable attorney’s
fees when the school district cannot reasonably believe that
no attorney’s fees have accrued.
Because she was substantially justified in rejecting
Colonial’s offer, Rena C. is eligible for attorney’s fees
accrued after Colonial’s ten-day offer. We therefore will
remand to the District Court for recalculation of attorney’s
fees.
D) We do not address Rena C.’s remaining arguments.
Rena C. argued that even if the IDEA precluded her
from receiving attorney’s fees, she would be entitled to fees
under the ADA and § 504, and that the school district’s
counterclaim provided a separate ground for an award of
attorney’s fees. Because we hold that the IDEA does not
preclude her from receiving attorney’s fees for work done
after the ten-day offer, we do not reach the arguments for
these alternative grounds for fees.
IV.
We will reverse and remand to the District Court for
calculation of reasonable attorney’s fees in accord with 20
U.S.C. § 1415(i)(3)(B)(i) and consistent with this Court’s
holding that Rena C. was substantially justified in rejecting
the ten-day offer under 20 U.S.C. § 1415(i)(3)(E).
23
GREENAWAY, JR., Circuit Judge, concurring.
I agree that Rena C. was substantially justified in
rejecting Colonial’s offer because the offer did not include the
payment of attorney’s fees, and I join the majority opinion in
full. I write separately to briefly discuss the difficulties certain
kinds of ten-day offers can create for school districts, parents,
and, ultimately, courts.
This case is illustrative of those difficulties because it
requires us to interpret what is a short and, in my view,
amorphous offer. The entire substance of the offer is contained
in two sentences: “This offer is also being made in order to
further limit the School District’s possible prevailing party
attorney fee attorney liability. The School District offers to pay
private school tuition and transportation for Parent’s unilateral
placement at Delaware Valley Friends School (‘DVFS’).” JA
49. Colonial asked this Court to conclude that the offer’s two
sentences contained a number of implicit terms: pendency at
DVFS and reimbursement for both one-one-one language arts
instruction and attorney’s fees. As the majority opinion
explains, we agreed with Colonial regarding pendency and
one-on-one instruction, but could not conclude that the terms
of the offer implied that Colonial would pay the attorney’s fees
Rena C. had incurred up to that point.
I found the question regarding one-on-one instruction to
be particularly challenging, both because the question of what
falls within the ambit of tuition seems to me vague and
indeterminate, and because the record here reveals little about
the nature of the one-on-one services A.D. receives at DVFS.
It merely indicates that DVFS provides her with a one-on-one
instructor for the subject of language arts.
1
In deciding to join the majority opinion’s conclusion
that Colonial’s offer to pay “private school tuition” included
an offer to pay for this one-on-one instruction, I found it
significant that Colonial’s offer was unqualified. It did not, for
example, say “base tuition” or “tuition only and no other cost
or fee.” As the majority opinion also notes, Colonial did not
know that one-on-one instruction would be listed separately on
the DVFS tuition invoice, so it had no reason to offer it
expressly. Ultimately, I concluded that the record, though
certainly far from comprehensive, provides enough
information for us to infer confidently that the one-on-one
instruction A.D. receives at DVFS is the kind of substantive
curricular service that a school district like Colonial would
generally consider to be within the ambit of a “tuition”
payment.
It bears emphasis, however, that the majority opinion
takes no position on whether countless other types of
supplementary educational services would be included in an
offer to pay “tuition.” The opinion does not answer, for
example, the question of whether a one-on-one aide who
accompanies a student for assistance throughout the school
day, but does not themself provide instruction, would be
included. Nor does it determine whether physical therapy
services, speech and language therapy services, or
occupational therapy services would be included. Given the
scarcity of information in the record here, I do not think this
Court is well-positioned to provide much guidance regarding
these questions.
I therefore would caution parties not to needlessly
proceed to federal court based on the belief that our opinion
here dictates the outcome in some future case involving some
2
other kind of educational service or instruction. Instead, I
would suggest that parties in the future be clear and specific
when crafting and discussing ten-day offers. School districts
should be precise about what they are offering. Parents should
be forthcoming about the services they are seeking or
anticipate receiving for their children. And both school
districts and parents should communicate throughout this
process. As the majority opinion correctly notes, ten-day
offers need not be non-negotiable. I understand that these
cases can be deeply personal, and I am under no illusion that
parties will always be on the best of terms, but litigants must
prioritize the children at the heart of these disputes.
A protracted IDEA dispute should result from a
legitimate disagreement about the needs of the student, not
conflicting interpretations regarding the wording of a
settlement offer. Indeed, ten-day offers should foster
discussion, which hopefully will often lead to the prompt
resolution of IDEA disputes without the need for due process
hearings or litigation. This purpose is not served, however,
when parties treat terse or inexact offers as non-negotiable. In
those circumstances, the parties potentially prolong the dispute
unnecessarily, for they risk losing sight of what is most
important: ensuring that the child gets the educational services
needed. Had the parties in this case communicated more
effectively, the dispute very well could have been resolved far
earlier and with the expenditure of fewer public funds. My
hope is that parties in these types of actions shall, in the future,
heed this caveat.
3