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July 25, 2000


The opinion of the court was delivered by: Munley, District Judge.


Before the court for disposition is the defendants' motion to dismiss this action that was brought under the Individuals with Disabilities Education Act. 20 U.S.C.A. § 1400 et seq. The plaintiff is Kristi H., a minor by and through her parent and next friend, Virginia H., and the defendants are Tri-Valley School District and Robert E. Franklin in his official capacity as Superintendent of the Tri-Valley School District. The matter is ripe for disposition as it has been fully briefed and argued.


Involved in the instant matter is the Individuals With Disabilities Education Act (hereinafter "IDEA"). In order to receive certain federal education funding, states must comport with the requirements of the IDEA, which provides in general that "free appropriate public education" must be made available to all children with disabilities*fn1 between the ages of three and twenty-one, inclusive. 20 U.S.C. § 1412(1)(A). An individualized education program (hereinafter "IEP") must be developed for each child with a disability*fn2 Id. § 1412(4). The law further provides "To the maximum extent appropriate, children with disabilities, including children in public or private institutions or other care facilities, are educated with children who are not disabled . . ." Id. § 1412(5)(A).

In order to resolve disputes that may arise under the IDEA between the parents and the school district, each state must establish a procedure involving an administrative review hearing. This hearing is called a "due process" hearing. 20 U.S.C. § 1415(f)-(i). Pennsylvania has implemented a two-tiered system where the local school district conducts an initial review. If appealed, the local district's decision is reviewed by a three-member Special Education Appeals Panel. 22 Pa.Code § 14.64. According to the IDEA, a civil action can only be brought in a federal district court after this two-tiered system has been exhausted. 20 U.S.C. § 1415(i)(2)(A).

If it is found that a school district has failed in its duty to provide "free appropriate education," the student may be awarded compensatory education. Compensatory education is an extension of the student's entitlement to a free appropriate education beyond the age of twenty-one to compensate for deprivations of that right before the student turned twenty-one. Carlisle Area School v. Scott P., 62 F.3d 520, 536 (3d Cir. 1995).

Kristi H., plaintiff in the instant case, was seventeen years old at the time of the filing of the complaint. She lives with her mother, Virginia H., within the geographical boundary of the Tri-Valley School District. Plaintiff is mentally retarded, and the defendants recognize that she is eligible for special education services under IDEA. Compl. ¶ 4.

Plaintiffs educational history is as follows: She attended kindergarten classes in a segregated center with only disabled children. The center was run by the Schuylkill County Intermediate Unit. Compl. ¶ 9. The Schuylkill County Intermediate Unit is a special school district that covers and operates special education programs for the defendant and other surrounding school districts in Schuylkill County. Id. at n. 2.

After kindergarten, and for the years 1990 through 1998, plaintiff was placed in an Intermediate Unit operated "life skills" classroom, which was also segregated. It was also located outside of the Tri-Valley School District. Compl. ¶ 10.

Plaintiffs mother was not satisfied with the education her daughter was receiving. Accordingly, on March 25, 1999, she requested a special education due process hearing to address the district's failure to provide an appropriate free education. Compl. ¶ 14.

On July 26, 1999, a Pennsylvania special education due process hearing officer held a one day hearing. Compl. ¶ 15. The hearing officer issued a written decision on August 9, 1999. Compl. ¶ 16. The hearing officer determined that IEP's developed by the defendant for the plaintiff for the two preceding years were inappropriate and failed to give her any meaningful benefit. Id. The hearing officer awarded the plaintiff, inter alia, two school years of compensatory education. Compl. ¶ 18. The defendant school district filed exceptions to the hearing officer's order with the Pennsylvania Special Education Appeals Panel. The district sought to have the amount of compensatory education awarded to the plaintiff reduced from two years to one. Compl. ¶ 22. The Appeals Panel upheld the defendant's exceptions and reduced the award of compensatory education to one year. Compl. ¶ 23. Plaintiff has brought suit to challenge the Appeals Panel's ruling. Plaintiff seeks to have its decision reversed and have the plaintiff provided with compensatory education beginning with the 1994-95 school year, or in the alternative, the two school years awarded by the due process hearing officer.

Defendants have filed a motion to dismiss the plaintiffs complaint pursuant to F.R.Civ.P. 12(b)(6). Defendant's motion raises the following two issues: 1) whether a one year effective "statute of limitations" for compensatory education claims exists under the Individuals with Disabilities Education Act; and 2) whether plaintiff has exhausted administrative remedies under the IDEA, or whether exhaustion is necessary, concerning compensatory education for the school years 1994-95 to 1996-97. We shall address each issue seriatim.

Standard of review

When a 12(b)6 motion is filed, the sufficiency of a complaint's allegations are tested. The issue is whether the facts alleged in the complaint, if true, support a claim upon which relief can be granted. In deciding a 12(b)6 motion, the court must accept as true all factual allegations in the complaint and give the pleader the benefit of all reasonable inferences that can fairly be drawn therefrom, and view them in the ...

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