Plaintiff Awarded over $2M in Attorneys Fees in Disability Case Against State

February 21, 2018

Persistence Pays

A Senior Federal District Court Judge has awarded over $1.3M in attorneys fees and other costs to the Plaintiff to be paid by the defendant State of South Carolina in a case that has been dragging on for over a decade. Combined with an award by the United States Fourth Circuit Court of Appeals in 2016, the total award is now over $2M.

The case began in 2003, and three times went up on appeal to the Fourth Circuit due to a decision adverse to Plaintiffs in the District Court. The third appeal had to do not with the substance of the case, but attorneys fees. In an unusual move, the Fourth Circuit on the third appeal (2016), rather than correcting the federal District Dourt’s reasoning and remanding for further determination of fee award, short-circuited the District Court, vacated its award of $100,000 as to fees related to federal court litigation, instead directly awarding over $700,000.

The Fourth Circuit also vacated the federal District Court’s award of zero dollars relating to state agency and state court litigation on the same matter, but remanded this to the federal District Court for determination of the amount. The federal District Court had awarded nothing because “state court proceedings were not necessary to advance the litigation in this court.” But the Fourth Circuit disagreed, finding the state court litigation “both useful and of a type ordinarily necessary to advance the civil rights litigation to the stage it reached”. It was upon remand that the federal District Court has now awarded the additional $1.3M.

The Fourth Circuit opinion in 2016 (“Doe III”) was unpublished but has a good summary of the case history. (You can also read Doe I and Doe II.)  The litigation began in 2003 in federal District Court. As the Fourth Circuit put in in Doe III, the Defendants (South Carolina Department of Disabilities and Special Needs and South Carolina Department of Health and Human Services) “repeatedly violated the Medicaid Act, even after Doe I [Fourth Circuit 2007] and Doe II [Fourth Circuit 2011] was decided. It was not until August 2013, two and a half years after Doe II, that the defendants came into compliance with the Medicaid Act.”

The opinion further notes that Doe I “changed the legal landscape under the Medicaid Act. … [T]his case opened the courthouse doors to claims that courts in this Circuit, including this district court, had routinely closed on plaintiffs. Plaintiffs now can enforce their rights under the Medicaid Act through [42 U.S.C.] §1983 – a direct result of Doe’s efforts in this case.” The Court further notes that Doe I has been adopted by other federal Circuit Courts, including the 7th and 3rd.

Mark’s Comment: It has long been very frustrating to special needs and elder law practitioners that state agencies and courts (some states much more than others) feel free to ignore Congress and establish their own Medicaid rules, often ad hoc, and usually with the aim of not providing benefits which Congress mandated. (If the state wants a change in policy, that’s fine, but the state either needs to lobby Congress for a change, or drop out of the Medicaid program.) Some state agencies have gone further, flagrantly violating rule of Civil Procedure to which their state attorneys are bound. The states have billions of dollars to fight the disabled; the disabled frequently have nothing. It is heartening to see that the state in this case has to pay for their misbehavior. Other cases around the country are brewing that may similarly hold state agencies feet to the fire. We can only hope that cases like this give pause to state actors who think it is their prerogative to make up their own rules.