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$2 million plus in fees

Civil rights suit over social services gets costlier for state

Two South Carolina agencies have spent nearly 15 years and millions of dollars fighting a disabled woman’s request for social services. So far, the agencies have lost three times at the 4th U.S. Circuit Court of Appeals and once at the South Carolina Supreme Court while racking up millions in legal fees and costs.

The state’s Department of Disabilities and Special Needs and the Department of Health and Human Services took another punch to the gut on Feb. 15, when a federal judge in Columbia ordered the agencies to pay $1,328,181 in attorneys’ fees and costs.

Senior U.S. District Judge Margaret Seymour’s order covered only a portion of what the disabled woman, who is identified in court filings as Sue Doe, has incurred in her protracted legal fight with the state.

In 2016, the 4th Circuit ordered DDSN and DHHS to pay $669,077 in attorneys’ fees, $39,173 in guardian ad litem fees and $5,523 in legal costs in Doe’s case. That decision dealt with Doe’s legal expenses up until August 2013, which led Seymour to find in her recent order that Doe was free to go after the state for fees and costs incurred after the 4th Circuit’s opinion.

The fee awards from the 4th Circuit and from Seymour now total $2,041,954 in Doe’s case, which stretches back to 2003. And that seven-figure tab does not include the fees that the state has been paying to private attorneys, including Kenneth Woodington and William Davidson of Davidson, Wren & Plyler in Columbia, to work on the case.

Woodington declined an interview request, citing his clients’ policy against commenting on pending litigation.  

An attorney for Doe, Patricia Harrison of Columbia, said the state has “wasted too much money” on the case.

“This is $2 million in our fees for them trying to keep one individual from getting services,” she added. “I hope the General Assembly will look at this absurd win-at-all-costs practice that these agencies have used.”

DDSN and DHHS had contended that Harrison and her co-counsel, Armand Derfner of Charleston, were not entitled to additional fees because they filed Doe’s motion for fees after the 14-day post-judgement deadline. But Seymour rejected the state’s argument and allowed the motion based on the excusable neglect theory.

She wrote that it appeared that Harrison and Armand believed that both sides were “several steps into the process of scheduling and resolving” the issue of post-2013 fees before the deadline expired, which led her to give Doe “the benefit of the doubt.”

Seymour also disagreed with the state’s contention that the 4th Circuit’s decision in 2016 essentially closed the door on Doe’s ability to seek additional fees. The state had argued that the 4th Circuit directed the lower court to enter a specific fee award to avoid the further expense of having a trial judge calculate the fees on remand.

“The court does not read the Fourth Circuit’s opinion so narrowly,” Seymour wrote.

Doe’s case hasn’t just cost state taxpayers millions of dollars — it’s also spurred several novel and significant appellate opinions.

The 4th Circuit’s first decision in the case broke new ground with a holding that the Medicaid Act created a private right of action enforceable through Section 1983, which allowed Doe, who has intellectual disabilities, to bring a civil rights claim seeking services. The court also ruled that the state had to inform applicants of their eligibility for Medicaid services within 90 days under the “reasonable promptness” standard.

In its second opinion, the 4th Circuit held that the state failed to comply with the Medicaid Act by continuing to refuse to pay for residential rehabilitation services of Doe’s choosing.

Doe’s case also involved a state action concerning her eligibility for Medicaid services, which led the South Carolina Supreme Court to declare that the cutoff age for considering evidence of an intellectual disability was 22, rather than 18.

“It was a seismic decision,” Harrison said in an earlier interview. “It gave you a window of four more years of evidence to prove that someone has an intellectual disability.”

After Seymour’s recent order, Harrison said she believed that DDSN and DHHS had “learned nothing from the holdings” in Doe’s case. For instance, she said the agencies are not following the reasonable promptness standard. And she added that she’d deposed several directors at the agencies who “weren’t even aware of the case.”  

“What you have is attorneys not informing the decision-makers that these cases exist,” she said. “It’s obvious that they’re not being provided with the information.”

But Harrison was hopeful that the latest fee award would motivate other attorneys to start taking on these types of cases and force change at DDSN and DHHS.

“Now that we’ve shown that you can get reasonable rates for pursuing litigation under 1983, that’s my hope,” she said. “These agencies are not going to comply with the law just because the 4th Circuit tells them to.”

The 11-page decision is Doe v. Kidd (Lawyers Weekly No. 002-041-18). An opinion digest is available at sclawyersweekly.com.

Follow Phillip Bantz on Twitter @SCLWBantz

 

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