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PAAC v. RIZZO

August 16, 1973

PAAC, as a Commission and Individually, et al., Plaintiffs,
v.
Frank L. RIZZO, Mayor of the City of Philadelphia and as an individual, et al., Defendants. CITY OF PHILADELPHIA, Plaintiff, v. Melvin L. HARDY and Isaiah Crippins, Defendants


Broderick, District Judge.


The opinion of the court was delivered by: BRODERICK

Broderick, District Judge.

 On May 10, 1973 this Court held a hearing on the request of Philadelphia Anti-Poverty Action Committee (PAAC), Melvin L. Hardy and Isaiah W. Crippins, plaintiffs in Civil Action No. 73-957 for injunctive relief against the Mayor of Philadelphia and others. Consolidated with it is Civil Action No. 73-990, a counter action by the City of Philadelphia against Melvin L. Hardy and Isaiah W. Crippins, a suit removed from the Court of Common Pleas of Philadelphia County. The issue presented in both actions is whether Frank L. Rizzo, the Mayor of Philadelphia, had the power to remove Melvin L. Hardy as the Executive Director of PAAC and the power to refuse to renew the contract of Isaiah W. Crippins as the General Counsel of PAAC.

 Civil Action No. 73-957 was filed in this Court on April 27, 1973 by plaintiffs, Melvin L. Hardy, Isaiah W. Crippins and PAAC, requesting, inter alia, preliminary and permanent injunctions to prevent the Mayor of Philadelphia and other defendants from interfering with the operation of PAAC, recognized by the Office of Economic Opportunity (OEO) and the City of Philadelphia as the local arm in the war against poverty. The City of Philadelphia instituted an action on May 1, 1973 in the Court of Common Pleas of Philadelphia County and obtained temporary injunctive relief barring, inter alia, Melvin L. Hardy and Isaiah W. Crippins from exercising the powers of the office of Executive Director of PAAC and General Counsel of PAAC respectively. For the purpose of this discussion, we shall refer to PAAC, Melvin L. Hardy and Isaiah W. Crippins as the plaintiffs and to Mayor Rizzo and the City of Philadelphia, et al. as the defendants. On May 2, 1973, the plaintiffs amended their original complaint to include as defendants The Honorable Ned L. Hirsh, Judge of the Court of Common Pleas, and Martin Weinberg, the City Solicitor of Philadelphia, and requested this Court to enjoin the State Court proceeding. On May 2, 1973 this Court consolidated the trial on the merits with the hearing for a preliminary injunction and set May 10, 1973 as the date for the hearing. On May 3, 1973 Melvin L. Hardy and Isaiah W. Crippins, defendants in the State Court proceeding, removed the action filed by the City of Philadelphia from the Court of Common Pleas to this Court, pursuant to 28 U.S.C. § 1441. Subsequently, the City Solicitor filed a motion to dismiss on behalf of the defendants in Civil Action No. 73-957 and a motion to remand Civil Action No. 73-990 to the Court of Common Pleas of Philadelphia County. This Court, having consolidated the actions, on May 10, 1973 held a hearing on the merits of the controversies.

 Plaintiffs claim that the defendants have usurped the authority of PAAC by attempting to remove Melvin L. Hardy as Executive Director and by refusing to approve the renewal of the contract of Isaiah W. Crippins as General Counsel of PAAC, and allege that such actions are contrary to the Economic Opportunity Act of 1964, 42 U.S.C. § 2791, as amended, and the guidelines and regulations promulgated pursuant thereto. Plaintiffs contend that under OEO regulations and guidelines the Community Action Council Board has the power to hire and fire the Executive Director and that the language of the City Ordinance authorizing the Mayor to select an Executive Director is not determinative of that issue. Plaintiffs also allege that under OEO regulations and guidelines PAAC is an autonomous non-profit agency designated by the City of Philadelphia for the purpose of participation in OEO funding pursuant to 42 U.S.C. § 2791(a) and that PAAC and not the Mayor of Philadelphia has the power to hire and fire the Executive Director and the General Counsel, pursuant to 42 U.S.C. § 2791(e). Defendants contend that PAAC was created by City Council as an agency of the City pursuant to 42 U.S.C. § 2791(a) and that the power to appoint both General Counsel and the Executive Director is vested in the Mayor. The defendants claim that the Executive Director and General Counsel serve at the pleasure of the appointing power, the Mayor.

 JURISDICTION

 Plaintiffs allege that this Court has jurisdiction under 5 U.S.C. §§ 701-706, 28 U.S.C. §§ 1331, 1361, 2201-02 and 42 U.S.C. §§ 1983, 2781 et seq. The Defendants contend that we lack jurisdiction over the subject matter of this suit. The basis of plaintiffs' contention that federal jurisdiction exists under 28 U.S.C. § 1331(a) is that their claim arises under 42 U.S.C. § 1983 and 42 U.S.C. § 2781 et seq. and that the construction of a federal statute, 42 U.S.C. § 2791, is involved in that 42 U.S.C. § 2791 and the regulations and guidelines issued pursuant thereto grant exclusively to PAAC the power to hire and fire the Executive Director and General Counsel and that the defendants have deprived the plaintiffs of rights secured by the OEO Act.

 A suit to enforce a right which takes its origin in the laws of the United States is not necessarily, or for that reason alone, one arising under those laws, for a suit does not so arise unless it really and substantially involves a dispute or controversy respecting the validity, construction or effect of such a law, upon the determination of which the result depends. Shulthis v. McDougal, 225 U.S. 561, 32 S. Ct. 704, 56 L. Ed. 1205 (1950). Plaintiffs' right to sue must be founded directly upon a federal law. Gully v. First National Bank, 299 U.S. 109, 57 S. Ct. 96, 81 L. Ed. 70 (1936). A case arises under a federal law if rights claimed by one party may be defeated by one construction of the statute and sustained by the opposite construction. Gully, supra, at 112, 57 S. Ct. 96.

 The very issue in this case is whether under 42 U.S.C. § 2791 and the OEO guidelines promulgated pursuant thereto, the Mayor of the City of Philadelphia has the power to fire the Executive Director of PAAC and the power to refuse to renew the contract of the General Counsel. PAAC was organized for the purposes of qualifying as a grantee community action agency of the OEO under 42 U.S.C. § 2781. To insure federal supervision and uniformity, OEO adopted guidelines. PAAC must comply with the guidelines promulgated by OEO. In the event of any conflict between the policies and practices of PAAC and OEO practices or federal legislation, PAAC must yield; and since there is no question that the matter in controversy exceeds the value of $10,000, we find that there is federal jurisdiction in the instant controversy. Hines v. Cenla Community Action Committee, Inc., 474 F.2d 1052 (5th Cir. 1973) (Wisdom, J., dissenting). See also the opinion of Honorable Edward Becker in Comprehensive Group Health Services et al. v. Temple University of Commonwealth, System of Higher Ed., 363 F. Supp. 1069 (1973). Hence, we find it unnecessary to consider the remaining jurisdictional allegations of the complaint.

 FAILURE TO EXHAUST THE ADMINISTRATIVE REMEDIES

 The defendants contend that the plaintiffs have failed to exhaust their administrative remedies before OEO and that the proceeding is, therefore, not ripe for judicial intervention. The principle of exhaustion of administrative remedies does not, however, have any application to the situation before us. Plaintiffs do not seek review of an administrative decision, nor can they obtain an administrative ruling since OEO has no administrative procedures to review issues such as those presented herein. See Rosado v. Wyman, 397 U.S. 397, 406, 90 S. Ct. 1207, 25 L. Ed. 2d 442 (1970). See also the opinion of Honorable Edward Becker in Comprehensive Group Health Services et al. v. Temple University of Commonwealth, System of Higher Ed., supra.

 STANDING TO SUE

 The Court finds that the plaintiffs have standing to press the claim that the defendants have failed to act in accordance with law in firing Mr. Hardy as the Executive Director of PAAC and in refusing to renew the contract of Mr. Crippins as General Counsel. As the previous Executive Director and General Counsel of PAAC, Mr. Hardy and Mr. Crippins are at least arguably within the zone of interests to be protected and have a personal stake and interest that impart the concrete adverseness required by Article III. Association of Data Processing Service v. Camp, 397 U.S. 150, 90 S. Ct. 827, 25 L. Ed. 2d 184 (1970); Barlow v. Collins, 397 U.S. 159, 90 S. Ct. 832, 25 L. Ed. 2d 192 (1970). *fn1"

 DISTINCTION BETWEEN A "COMMUNITY ACTION AGENCY" ADMINISTERED BY A "COMMUNITY ACTION BOARD" AND A "COMMUNITY ACTION AGENCY" ...


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