The opinion of the court was delivered by: SHAPIRO
Plaintiffs brought this action on behalf of a class of mentally retarded individuals who were institutionalized at Woodhaven Center ("Woodhaven"), an intermediate care facility for the mentally retarded operated by Temple University under contract with the Commonwealth of Pennsylvania, and had been recommended for discharge to less restrictive community living arrangements ("CLAs") but had not yet been discharged.
Plaintiffs brought this action under the Civil Rights Act of 1871, 42 U.S.C. § 1983 and 28 U.S.C. § 1331. Jurisdiction is conferred by 28 U.S.C. § 1343(3) and (4).
On November 4, 1985, a hearing was held pursuant to Fed.R.Civ.P. 23(e) on plaintiffs' motion to approve a settlement with defendants. Upon full consideration of the written submissions and transcript at oral argument in support of the settlement, the court now approves the settlement as fair, reasonable and adequate.
Plaintiffs alleged that they committed themselves voluntarily to Woodhaven by contracts with Woodhaven and plaintiffs' respective base service units ("BSUs"). Third Amended Complaint, paras. 19, 30. These contracts required Woodhaven to provide CLAs when plaintiffs had completed their treatment programs. Third Amended Complaint, paras. 21, 32. Plaintiffs alleged that although they completed their Woodhaven treatment programs and were referred by the Woodhaven staff to BSUs for community placement, they have not been placed in CLAs. Third Amended Complaint, paras. 24, 25, 35, and 36. Plaintiffs alleged that they have not been placed "because defendants . . . have failed to discharge their . . . duties under federal and state law to provide plaintiff with suitable community living arrangements." Third Amended Complaint, para. 25. The defendants in this case are the Secretary of the Department of Public Welfare of the Commonwealth of Pennsylvania, in his official capacity, the City of Philadelphia, and the Executive Director of the Office of Mental Health/Mental Retardation in his official capacity.
Plaintiffs sought a declaratory judgment that defendants' alleged failure to provide them with CLAs resulted in plaintiffs' unnecessary institutionalization in violation of: 1) the Eighth and Fourteenth Amendments to the United States Constitution; 2) the Rehabilitation Act of 1973, 29 U.S.C. § 794; 3) the Developmentally Disabled Assistance and Bill of Rights Act, 42 U.S.C. § 6001 et seq.; and 4) Pennsylvania law.
Plaintiffs also sought injunctive relief requiring defendants to: 1) develop for class members individual exit plans into CLAs; 2) place class members into suitable CLAs if such facilities exist; and 3) if no suitable CLAs are available, fund the creation of new CLAs so that class members can be placed in such facilities.
Defendant Secretary moved for summary judgment or, in the alternative, for a stay on the ground that plaintiffs were members of the class certified in Halderman v. Pennhurst State School and Hospital, 446 F. Supp. 1295 (E.D.Pa. 1977), aff'd in part, 612 F.2d 84 (3d Cir. 1979), vacated and remanded, 451 U.S. 1, 101 S. Ct. 1531, 67 L. Ed. 2d 694 (1981); judgment restated on remand, 673 F.2d 647 (3d Cir. 1982), rev'd and remanded, 465 U.S. 89, 79 L. Ed. 2d 67, 104 S. Ct. 900 (1984) (" Pennhurst "), and therefore were barred under the doctrines of res judicata and collateral estoppel from maintaining this action. The Pennhurst action was filed in May, 1974 by retarded residents and former residents of Pennsylvania State School and Hospital (now Pennhurst Center), an institution owned and operated by the Commonwealth of Pennsylvania, to obtain, inter alia, an injunction closing Pennhurst and requiring the state to provide care, training and education for class members in CLAs. Pennhurst, 456 F. Supp. at 1298. In November, 1976 the Pennhurst court certified a class consisting of all retarded persons "who as of May 30, 1974, and any time subsequent, have been or may become residents of Pennhurst . . . ." 446 F. Supp. at 1300. The class included all retarded persons residing at Pennhurst on that date, those on the waiting list and those who may be placed at Pennhurst because of the unavailability of "alternative services in the community." Id. The defendants were "Pennhurst; the Pennsylvania Department of Public Welfare; various state and county officials responsible for supervising the Commonwealth's and the counties' retardation programs; and the superintendent and various employees of Pennhurst." 446 F. Supp. at 1301-02 (footnote omitted).
On June 11, 1984, this court granted summary judgment for defendants on the ground that the named plaintiffs were members of the Pennhurst waiting list and therefore were barred from bringing this action.
An appeal was taken but plaintiffs' subsequent request that the Third Circuit Court of Appeals remand this action for consideration of a Rule 60(b) motion was granted on August 27, 1984. The Rule 60(b) motion was based on newly discovered evidence, i.e., the Pennhurst settlement agreement, executed on July 12, 1984, provided no relief to the named plaintiffs or members of the putative class in this action. The relief granted in Pennhurst was limited to its then present residents and the Pennhurst settlement class was modified accordingly. See Halderman, et al. v. Pennhurst State School, et al., 610 F. Supp. 1221, 1228 (E.D.Pa. 1985).
This court gave favorable consideration to the Rule 60(b) motion and on July 3, 1985, with the consent of the parties, certified a Rule 23(b)(2) liability class of, "All mentally retarded individuals currently residing at Woodhaven Center whose domicile is or was Philadelphia County who have been recommended by treatment teams at Woodhaven Center for discharge to less restrictive community living arrangements."
While the state defendant will provide funding, the City defendants will provide the actual CLAs. The City defendants also will provide community services to ensure minimally adequate habilitation for each class member.
The actual placement decisions will be made by an interdisciplinary team. Plaintiff class members and their parents and/or guardians, or closest relatives, will play a significant role on that team in the placement decision-making process. Nothing in the settlement agreement requires the interdisciplinary team to place any member of the class in a CLA. In addition, the settlement agreement specifically provides that absent the availability of an appropriate placement, no class member will be moved merely to meet a timetable.
Implementation of the agreement is contingent upon the availability of state funds. In the event that there are insufficient funds, plaintiffs retain the right to litigate their claims. The court will maintain active jurisdiction until June 30, 1991 to ensure compliance with the agreement but the court will play no role in the placement decision-making process. On June 30, 1991, the case may be dismissed with prejudice.
On September 13, 1985, the court ordered that notice of the proposed settlement be sent by first class mail on or before September 20, 1985, to each member of the class and to a family representative of each class member. The notice stated that any member of the class or family representative who objected to the settlement could appear and be heard on the proposed settlement on November 4, 1985 so long as any objections had been filed in written form on or before October 25, 1985. The court finds this notice complied with Fed.R. Civ.P. 23(e) and was the best practicable under the circumstances.
Rule 23(e) of the Federal Rules of Civil Procedure mandates court approval of a class action settlement:
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. . . .
Approval of a proposed class action settlement is discretionary with the court. Girsh v. Jepson, 521 F.2d 153, 156 (3d Cir. 1975); Ace Heating & Plumbing Company v. Crane Company, 453 F.2d 30, 34 (3d Cir. 1971). Settlement is a course favored by law, Weight Watchers of Philadelphia, Inc. v. Weight Watchers International, Inc., 455 F.2d 770, 773 (2d Cir. 1972), but a settlement will be approved only if it is "fair, adequate, and reasonable" to the members of the class, Walsh v. Great Atlantic and Pacific Tea Company, Inc., 726 F.2d 956, 965 (3d Cir. 1983). The settlement must be both substantively reasonable compared to the likely rewards of litigation, ...