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Mark v. McMaster

United States District Court, D. South Carolina, Columbia Division

March 30, 2018

Kobe, Mark, [1]Plaintiffs,
v.
Henry McMaster, in his capacity as Governor[2] of the State of South Carolina, et al., Defendants.

          ORDER AND OPINION

          MARGARET B. SEYMOUR SENIOR UNITED STATES DISTRICT JUDGE.

         Plaintiffs Kobe and Mark filed a complaint on May 11, 2011, and an amended complaint on October 18, 2011. Plaintiffs alleged the following causes of action: Violation of the Americans With Disabilities Act (Count One); Violation of Section 504 of the Rehabilitation Act (Count Two); violation of 42 U.S.C. § 1983 (Count Three); Violation of 42 U.S.C. §§ 1983 and 1988 (violation of civil rights) (Count Four); Violation of 42 U.S.C. § 1985(3) (conspiracy) (Count Five); Violation of the Supremacy Clause (Count Six); and Violation of RICO (Count Seven).[3] The case originally was assigned to the Honorable J. Michelle Childs. It was reassigned to the Honorable Timothy M. Cain on October 18, 2011.

         On August 10, 2012, the Honorable Timothy M. Cain dismissed Defendants Nikki Haley, in her official capacity as Governor and Chairman of the South Carolina Budget and Control Board;[4] Curtis Loftis and Brian White, as members of the South Carolina Budget and Control Board; and Daniel Cooper and Converse Chellis, in their capacities as former members of the South Carolina Budget and Control Board, on the grounds of Eleventh Amendment immunity as to claims asserted against them in their official capacities. He determined none of them had a special connection to the administration of the state's Medicaid program such than an injunction against them would provide any redress. Judge Cain also found that, to the extent Defendants Cooper and Chellis were sued in their individual capacities, these Defendants had no authority to provide prospective injunctive relief. Judge Cain also determined that Defendants Cooper and Chellis were entitled to legislative immunity. ECF No. 135. On August 12, 2013, Judge Cain dismissed Defendants Hugh Leatherman and Richard Eckstrom, in their capacities as members of the South Carolina Budget and Control Board, on the grounds of Eleventh Amendment immunity and legislative immunity. ECF No. 217.

         On July 7, 2014, the within action was reassigned to the undersigned. Remaining in the case were Plaintiffs Kobe and Mark, as well as Defendants Anthony Keck, in his capacity as the Director of the South Carolina Department of Health and Human Services; Emma Forkner, in her capacity as the former Director of the South Carolina Department of Health and Human Services; Beverly Buscemi, in her capacity as Director of the South Carolina Department of Disabilities and Special Needs; Eugene A. Laurent, former Interim Director of the South Carolina Department of Disabilities and Special Needs; Stanley Butkus, former Director of the South Carolina Department of Disabilities and Special Needs; Richard Huntress, in his capacity as Commissioner of the South Carolina Department of Disabilities and Special Needs; Kathi Lacy, Thomas P. Waring and Jacob Chorey, in their capacities as employees of the South Carolina Department of Disabilities and Special Needs; Mary Leitner, in her capacity as the Director of the Richland Lexington Disabilities and Special Needs Board; the Babcock Center; Judy Johnson, in her capacity as the Director of the Babcock Center; and other Unnamed Actors Associated with the Babcock Center.[5]

         FACTS AND PROCEDURAL HISTORY

         At the time of filing the amended complaint, Kobe was 29 years old. Kobe is unable to walk or to speak and has a history of convulsions. Kobe attends the Hope Bridge Adult Day Care program and receives Adult Day Health Care (ADHC) services. In December 2010, the Richland-Lexington Disabilities and Special Needs Board was directed by the South Carolina Department of Disabilities and Special Needs (DDSN) to update eligibility of persons using ADHC services. Kobe was informed by the Richland-Lexington Disabilities and Special Needs Board that he no longer was eligible for ADHC services. Kobe appealed the termination of services to DDSN, and Defendant Beverly Buscemi, Director of DDSN, determined on May 11, 2011, that Kobe should continue to receive ADHC services. Despite being successful at the DDSN level, Kobe appealed the termination of services to the South Carolina Department of Health and Human Services (DHHS). The issue was resolved by consent order dated August 9, 2012. There was no lapse in ADHC services for Kobe during this time.

         Kobe also alleged that he requested from DHHS an augmentative communications device (ACD) to aid him in communicating. He received an ACD that was not as sophisticated as that prescribed by his treating physician. Kobe further contended that his wheelchair was damaged when he was dropped by employees of the Babcock Center while being loaded into a vehicle, and that the wheelchair was not replaced promptly by DHHS.

         Mark also receives ADHC services. Like Kobe, Mark was notified in 2011 that he no longer was eligible for ADHC services. Mark appealed the termination to DDSN, which upheld the termination. However, the issue also was resolved in Mark's favor at the DHHS level by consent order. Mark's ADHC services did not lapse during this time period.

         Mark lives with his sister. Mark contended that in 2010 DDSN reduced the number of respite hours to which he is entitled. Mark asserted that he is at risk of institutionalization if his sister is not provided with the support and services that he needs.

         The matter came before the court on motions for summary judgment filed by Defendants on January 6, 2014. Plaintiffs also filed a motion for summary judgment on January 6, 2014, which was amended on January 22, 2014. The court held a hearing on September 23, 2014. Plaintiffs contended that the court should resolve the following issues:

(1) Have the Defendants violated the reasonable standards provision of 42 U.S.C. § 1396a(a)(17) of the Medicaid Act and the South Carolina Administrative Procedures Act by failing to establish and utilize reasonable, ascertainable, non-arbitrary standards and procedures to determine eligibility for and the extent of medical assistance provided to Plaintiffs?

         Plaintiffs stated that the court should “issue a permanent injunction against Defendants denying medical services ordered by Plaintiffs' treating physicians based on binding norms that have not been promulgated as regulations. Plaintiffs requested that Defendants be required to give the deference ordered by the United States Supreme Court to the orders of Plaintiffs' treating physicians. Plaintiffs request that Defendants be prohibited from denying medically necessary services based on amendments made by the agencies without promulgation of regulations.”

(2) Have the Defendants violated the “reasonable promptness” requirement of the Medicaid Act by failing to provide Kobe with the wheelchair and speech device his physician ordered and by failing to provide residential services in the least restrictive setting within ninety days of those needs being identified?

         Plaintiffs stated that Kobe's physicians have ordered a wheelchair and speech device, but DHHS has failed to provide this equipment with reasonable promptness. Plaintiffs requested the court order Defendants to immediately provide Kobe with (1) a wheelchair to be provided within thirty days without further administrative delays, and (2) a speech device ordered by his physician within thirty days and speech services determined by his physician to be medically necessary, based on the evaluation by his licensed speech and language pathologists.

(3) Have the Defendants violated the integration mandate of the Americans with Disabilities Act by failing to provide Kobe with a wheelchair, a speech device, speech therapy services and placement in a supervised apartment with necessary support services?

         Plaintiffs stated: “Kobe requests that this Court issue a declaratory order finding that Defendants have violated the ADA in the operation of their programs and enjoining them from continuing to violate the ADA. He requests that DHHS be ordered to pay for the wheelchair and speech device ordered by his physician to be funded by Defendants. He requests continued speech services to improve his ability to communicate.”

         The court issued an order and opinion on September 30, 2014, concluding as follows:

A. Mootness
It is well settled that federal courts have no authority to “‘give opinions upon moot questions or abstract propositions, or to declare principles or rules of law which cannot affect the matter in issue in the case before it.'” Int'l Coal. for Religious Freedom v. Maryland, 3 Fed.Appx. 46, 48-49 (4th Cir. 2001) (quoting Church of Scientology of Cal. v. United States, 506 U.S. 9, 12 (1992)). This is so even though such case presented a justiciable controversy at an earlier point in time and an intervening event rendered the controversy moot. Id. (citing Calderon v. Moore, 518 U.S. 149, 150 (1996)).
In this case, Plaintiffs were informed in 2010 that they no longer qualified for ADHC assistance. However, their ADHC services were never interrupted, and they both prevailed during the administrative appeals process. Further, it appears that Kobe has received a new wheelchair. The court finds these claims to be moot.
B. Ripeness
The ripeness doctrine aims to “‘prevent the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements over administrative policies.'” Pasby v. Delia, 709 F.3d 307, 317 (4th Cir. 2013) (quoting Abbott Labs. v. Gardner, 387 U.S. 136, 148 (1967), abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1977)). A claim should be dismissed as unripe if the plaintiff has not yet suffered injury and any future impact “‘remains wholly speculative.'” Doe v. Virginia Dep't of State Police, 713 F.3d 745, 758 (4th Cir. 2013) (quoting Gasner v. Bd. of Supervisors, 103 F.3d 351, 361 (4th Cir. 1996)). In determining ripeness, a court must “‘balance the fitness of the issues for judicial decision with the hardship to the parties of withholding court consideration. A case is fit for judicial decision when the issues are purely legal and when the action in controversy is final and not dependent on future uncertainties.'” Id. (quoting Miller v. Brown, 462 F.3d 312, 319 (4th Cir. 2006)).
Mark's contention that the reduction in his respite hours could lead to the loss of care by his sister is too remote and speculative to be ripe for federal judicial review. See Charter Fed. Sav. Bank v. Office of Thrift Supervision, 976 F.2d 203, 208-09 (4th Cir. 1992) (“‘[I]n the context of an administrative case, there must be ‘an administrative decision [that] has been formalized and its effects felt in a concrete way by the challenging parties.'”)(quoting Pac. Gas & Elec. v. Energy Res. Comm'n, 461 U.S. 190, 200 (1983)).
C. Standing to Invoke Injunctive Relief
To satisfy Article III's case-or-controversy standing requirements, a plaintiff must show (1) he has suffered an “injury in fact” that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision. Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 180 (4th Cir. 2000) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992)). The standing question is whether the plaintiff has “‘alleged such a personal stake in the outcome of the controversy' as to warrant his invocation of federal-court jurisdiction and to justify exercise of the court's remedial powers on his behalf.” Warth v. Seldin, 422 U.S. 490, 498-99 (1975) (quoting Baker v. Carr, 369 U.S. 186, 204 (1962)). Further, “when the asserted harm is a ‘generalized grievance' shared in substantially equal measure by all or a large class of citizens, that harm alone normally does not warrant exercise of jurisdiction.” Id. at 499 (citing cases). In addition, “even when the plaintiff has alleged injury sufficient to meet the ‘case or controversy' requirement, . . . the plaintiff generally must assert his own legal rights and interests, and cannot rest his claim to relief on the legal rights or interests of third parties.” Id. (citing cases). “Without such limitations- closely related to Art[icle] III concerns but essentially matters of judicial self-governance-the courts would be called upon to decide abstract questions of wide public significance even though other governmental institutions may be more competent to address the questions and even though judicial intervention may be unnecessary to protect individual rights.” Id. at 500 (citing Schlesinger v. Reservists Comm. to Stop the War, 418 U.S. 209, 222 (1974) (“‘The desire to obtain sweeping relief cannot be accepted as a substitute for compliance with the general rule that the complainant must present facts sufficient to show that his individual need requires the remedy for which he asks.'”) (quoting McCable v. Atchison, T. & S.F.R. Co., 235 U.S. 151, 164 (1914)).
As can readily be discerned from the allegations set forth hereinabove, and further as argued in the hearing, Plaintiffs allege systemic failures within the DHHS and DDSN systems and ask the court to intervene in the administration and operation of these agencies of the State of South Carolina. In particular, Plaintiffs seek to have the court oversee DHHS's promulgation of regulations that Plaintiffs contend would force compliance with federal Medicaid law. While Plaintiffs' allegations of wholesale mismanagement and, indeed, criminal conduct within DHHS, DDSN, and the Babcock Center are sobering, ”[i]t is an established principle . . . that to entitle a private individual to invoke the judicial power to determine the validity of executive or legislative action he must show that he has sustained or is immediately in danger of sustaining a direct injury as a result of that action.” Lujan, 504 U.S. at 574-76. Plaintiffs show no cognizable particularized injury. Plaintiffs lack standing to seek injunctive relief on behalf of others regarding the allegations of mishandling of funds and exploitation set forth in the amended complaint.

         ECF No. 296.

         Plaintiffs timely filed a notice of appeal. On December 15, 2016, the Court of Appeals for the Fourth Circuit affirmed in part, vacated in part, and remanded the action. ECF No. 368. First, the Fourth Circuit affirmed the court's rulings as to Mark on ripeness grounds. Id. at 33, n.21. Next, the Fourth Circuit affirmed the court's determination that the eligibility to receive ADHC services is moot based on the consent orders entered into with these Plaintiffs. Id. at 37.

         The Fourth Circuit determined, however, that there was a “pattern of allegedly unreasonable delays and improper denials” with respect to Kobe's wheelchair and ACD entitlement. The Fourth Circuit found that Defendants “have not met their ‘heavy burden' of showing that after this litigation has concluded, Kobe will not once again find himself without the equipment he needs and without any ability to obtain it without significant delay.” Id. at 39. Therefore, the Fourth Circuit vacated the court's order on justiciability grounds, and remanded for further proceedings. Id. In addition, the Fourth Circuit determined that, since the case continues to present justiciable issues, it would vacate the grant of summary judgment against Plaintiffs on Counts One through Seven and remand for further consideration of the viability of each of Plaintiffs' claims against each Defendant. Id. at 40.

         Finally, the Fourth Circuit turned to Judge Cain's order dismissing Defendant Haley on the basis of Eleventh Amendment immunity.[6] The Fourth Circuit found that Judge Cain properly ruled Defendant Haley lacked the special relation to the administration of the South Carolina's Medicaid program such that no effective prospective relief would be available as against her. However, the Fourth Circuit found that Plaintiffs had not specifically waived their claim against Defendant Haley for damages. As a result, the Fourth Circuit vacated the dismissal of Count One as against Defendant Haley. The Fourth Circuit noted that no party had addressed the application of United States v. Georgia, 546 U.S. 151 (2006), with respect to whether Congress validly abrogated South Carolina's Eleventh Amendment immunity as to claims arising out of Title II of the ADA. The test under Georgia instructs the lower courts to:

[D]etermine . . . on a claim-by-claim basis, (1) which aspects of the State's alleged conduct violated Title II; (2) to what extent such misconduct also violated the Fourteenth Amendment; and (3) insofar as such misconduct violated Title II but did not violate the Fourteenth Amendment, whether Congress's purported abrogation of sovereign immunity as to that class of conduct is nevertheless valid.

546 U.S. at 159.

         Thus, the Fourth Circuit held that dismissing Counts One and Two against Defendant Haley on Eleventh Amendment grounds was premature. ECF No. 368, 50.

         This matter now is before the court on the following motions:

1. Motion for summary judgment on remand filed by Defendants Buscemi, Butkus, Chorey, Huntress, Lacy, Laurent, and Waring on April 28, 2017, and amended on August 8, 2017. Plaintiff Kobe filed responses in opposition on September 14, 2017 and September 17, 2017, and amended October 3, 2017, to which these Defendants filed a reply on October 17, 2017.
2. Motion to dismiss filed by Defendant McMaster (formerly Haley) on May 1, 2017, and amended on July 21, 2017. Plaintiff Kobe filed responses in opposition on September 14, 2017 and September 17, 2017, and amended October 3, 2017, to which Defendant McMaster filed a reply on August 16, 2017.
3. Motion for summary judgment filed by Defendant Leitner on August 11, 2017. Plaintiff Kobe filed responses in opposition on September 14, 2017 and September 17, 2017, and amended October 3, 2017, to which Defendant Leitner filed a reply on October 27, 2017.
4. Motion for summary judgment filed by Defendants Forkner and Keck on August 11, 2017. Plaintiff Kobe filed responses in opposition on September 14, 2017 and September 17, 2017, and amended October 3, 2017, to which Defendants Forkner and Keck filed a reply on October 17, 2017.
5. Third motion for summary judgment filed by Defendants Babcock Center and Johnson on August 11, 2017. Plaintiff Kobe filed responses in opposition on September 14, 2017 and September 17, 2017, and amended October 3, 2017, to which these Defendants filed a reply on October 27, 2017.
6. Motion for summary judgment filed by Kobe on August 21, 2017, to which Defendant McMaster filed a response in opposition on September 8, 2017; Defendants Forkner and Keck on September 13, 2017, Defendants Buscemi, Butkus, Chorey, Huntress, Lacy, Laurent, and Waring on September 14, 2017; Defendants the Babock Center and Johnson on September 14, 2017; and Defendant Leitner on September 14, 2017. Plaintiff filed replies to responses of Defendants McMaster; Fortner and Keck; Buscemi, Butkus, Chorey, Huntress, Lacy, Laurent, and Waring on October 27, 2017; and replies to responses of Defendants Leitner; and Babock Center and Johnson on October 28, 2017.
7. Motion to strike Plaintiff's motion for summary judgment filed by Defendants Babcock Center and Johnson on October 27, 2017. Plaintiff filed a response in opposition on November 13, 2017, to which these Defendants filed a reply on November 29, 2017.

         PLAINTIFFS' CAUSES OF ACTION [[7]]

         COUNT ONE VIOLATION OF THE AMERICANS WITH DISABILITIES ACT

         260. Plaintiffs and Class Members[8] adopt and restate the allegations set forth above in this complaint.

         261. It is undisputed that Plaintiffs are qualified individuals with disabilities who have physical and/or mental impairments that substantially limit one or more of their major life activities, including, but not limited to one of more of the following: thinking, walking, communicating, learning, working, caring for themselves and concentrating. See 42 U.S.C. § 12102.

         262. The treating professionals of the State have determined that community-based treatment is appropriate for the Plaintiffs and Class Members; they do not oppose community placement and their needs can be reasonably accommodated without fundamentally altering the nature of how the State delivers services.

         263. Public entities, like the SCBCB, the South Carolina General Assembly, SCDHHS, SCDDSN, the Babcock Center and local DSN Boards are required by federal law to make reasonable modifications in policies, practices, or procedures when the modifications are necessary to avoid discrimination on the basis of disability, except where the public entity can demonstrate that making the modifications would fundamentally alter the nature of the service, program, or activity. 28 CFR § 35.130(b)(7).

         264. Defendants who were members of the South Carolina Budget and Control Board in 2009 violated the ADA by failing to insure that the funds paid to SCDDSN were spent appropriately for services Plaintiffs and Class Members need, despite repeated warnings from the South Carolina Legislative Audit Council, federal and state audits showing that SCDDSN was spending those funds to purchase real estate to force waiver participants into WAC's to profit the State.

         265. Defendants have failed to consider the State's obligations under the ADA in allocating funds necessary to provide necessary community based services to Plaintiffs and Class Members to allow them to receive services in the most integrated setting appropriate to their treatment needs.

         266. Defendants have failed to consider their obligations to the Plaintiffs and Class Members under the ADA by expending tens of millions of dollars unnecessarily to purchase and renovate real property used as WAC's which properties are being utilized to financially exploit persons who have disabilities.

         267. Defendants have acted to terminate the ADHC services of the Plaintiffs and Class Members and to reduce other services needed by Medicaid waiver participants which are necessary to allow them to live in the least restrictive setting.

         268. These actions were taken without conducting a cost analysis to determine the cost of alternative services, including, but not limited to the cost of WAC services and the real estate funded by SCDDSN.

         269. In doing so, Defendants have been indifferent to the medical, emotional and other treatment needs of the Plaintiffs and Class Members and to the full costs of operating the WAC's owned by local DSN Boards.

         270. The treating physicians of the Plaintiffs and Class Members have determined that ADHC services are medically necessary and the Defendants have failed to give deference to the treatment orders of their treating physicians in violation of the mandate of the United States Supreme Court in Olmstead v. L.C.527 U.S. 581 (1999).

         271. Under the “integration mandate” of Title II of the ADA, Defendants must administer long-term care services in a manner that provides services to individuals who have disabilities in the most integrated setting appropriate to their needs.

         272. Services provided in WAC's are not appropriate to the needs of the Plaintiffs and Class Members.

         273. The actions taken by Defendants discriminate against persons whose physicians have determined that they require ADHC, by denying services that are appropriate to their needs.

         274. The State's unjustified attempts to force these persons into WAC's place them at risk of institutionalization, including hospitals, nursing homes and ICF/MR's and it constitutes a form of discrimination based on disability which is prohibited by Title II, 42 U.S.C. § 12101(a)(2), (5).

         275. The arbitrary determinations made by DSN Service Coordinators, who are acting on directives from Defendant Kathi Lacy and other individual Defendants for economic gain, will force the Plaintiffs and Class Members into inappropriate placements where their health and safety will be endangered at greater costs to taxpayers of the State.

         276. The services Plaintiffs and Class Members request are not unreasonable, given the demands on the State's health care budget and the resources available to pay for these services and the ADHC services Plaintiffs request cost less than placement in a hospital or an SCDDSN Regional Center.

         277. The Plaintiffs' needs can be reasonably accommodated, as has been demonstrated by their continuous care in the community while receiving ADHC services for many years.

         278. Providing the ADHC services Plaintiffs request would not place an unreasonable burden on the State nor would it force the state to fundamentally alter the nature of its programs.

         279. ADHC services ordered by Plaintiffs's and Class Members' physicians can be provided without undue burden to the state, taking into consideration its obligation to provide health care and services with an “even hand.” 280. Defendants have further violated the ADA by denying Kobe's requests for an ACD and his choice to move to a less restrictive setting and by reducing Mark's respite services, which are all needed for him to remain out of an institutional setting.

         281. Defendants have failed to make reasonable modifications to the programs operated by SCDDSN which are necessary for Plaintiffs to receive services in the least restrictive setting.

         282. The failure to offer Plaintiffs and Class Members services, including, but not limited to ADHC services, to allow Plaintiffs to live in integrated home and community based settings constitutes unlawful discrimination in violation of Title II of the ADA and its implementing regulations at 28 C.F.R. § 35.130(d).

         283. Defendants have failed to exercise their discretion in a non-discriminatory manner by denying Plaintiffs necessary funds used to provide the ADHC services they require to live the least restrictive setting.

         284. The willful and intentional acts of the individual Defendants have placed the Plaintiffs and Class members at risk and caused them to experience extreme emotional distress and fear of retaliation for filing this lawsuit in violation of the andti-retaliation provisions of the ADA.

         285. Plaintiffs request a finding that Defendants have violated the ADA and its implementing regulations and an order requiring that Defendants pay attorney fees, expenses and costs and damages in such amount as the Court shall determine to be just and fair.

         COUNT TWO VIOLATION OF SECTION 504 OF THE REHABILITATION ACT

         286. Plaintiffs adopt and restate the allegations set forth above in this complaint.

         287. Section 504 of the Rehabilitation Act of 1973 provides, “no otherwise qualified individual with a disability in the United States...shall, solely by reason of her or his disability, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance. 29 U.S.C. § 794(a), 288. “Program or activity' includes a department, agency, special purpose district, or other instrumentality of a State or local Government. 29 U.S.C. § 794(b)(1)(A).

         289. The Medicaid Waiver programs administered by SCDDSN are “programs or activities” provided by the State of South Carolina.

         290. “Recipient” of federal financial assistance also includes any public or private agency or other entity to which Federal financial assistance is extended directly or through another recipient. 28 C.F.R. § 41.3(d).

         291. SCDHHS, SCDDSN, local DSN Boards and the Babcock Center are all recipients of federal financial assistance.

         292. Regulations implementing Section 504 require a recipient of federal financial assistance to administer its services, programs, and activities in the “most integrated setting appropriate” to the needs of qualified individuals with disabilities. 28 C.F.R. § 41.51(d).

         293. Federal Medicaid funds account for a majority (nearly 80% when this lawsuit was filed) of the cost of the home and community based waiver programs administered by SCDDSN.

         294. Defendants and their contracting agencies and organizations are recipients of Federal financial assistance under Section 504 and its implementing regulations.

         295. Plaintiffs are “qualified persons with disabilities” within the meaning of Section 504 because they have physical and/or mental impairments that substantially limit one or more major life activities, and they meet the essential eligibility requirements for the home and community based waiver programs administered by SCDDSN. See 29 U.S.C. § 705(9).

         296. The treating physicians of the Plaintiffs and Class Members have determined that ADHC services are provided in the “most integrated setting appropriate” to their medical needs as qualified individuals with disabilities. 28 C.F.R. § 41.51(d).

         297. The South Carolina Budget and Control Board failed to insure that the funds allocated to SCDDSN were spent as appropriated by the General Assembly to provide services, despite warnings from the South Carolina Legislative Audit Council that SCDDSN was spending those funds improperly for the purchase of real estate.

         298. Defendants have threatened to terminate funds necessary for Plaintiffs and Class Members to receive services in the most integrated setting appropriate to meet their needs in order to financially exploit them.

         299. Defendants have failed to make reasonable modifications to home and community based waiver programs to allow Plaintiffs and Class Members to receive ADHC services and other home and community based waiver services so that they can successfully live in the least restrictive setting appropriate to their needs.

         300. Failure to provide services in the least restrictive setting appropriate to the needs of Plaintiffs and Class Members and forcing them to attend WAC's, where they will be financially exploited, constitutes unlawful segregation in violation of Section 504 of the Rehabilitation Act and its implementing regulations at 28 C.F.R. 42.51(d).

         301. The individual Defendants, Buscemi, Lacy, Waring, Huntress, Chorey and Johnson have acted willfully together and with others in intentional disregard of the federal rights of the Plaintiffs and Class Members in willful and intentional violation of Section 504.

         302. Defendants have also utilized criteria and methods of administration that subject Plaintiffs to discrimination on the basis of disability, including risk of unnecessary institutionalization, by (1) failing to assess properly the services and supports that would enable Plaintiffs to live in the least restrictive setting, (2) failing to ensure that Plaintiffs have access to Medicaid-covered services that will meet their needs in the community, and (3) compelling health care providers to reduce or eliminate recommended ADHC services, thereby violating Section 504 and its implementing regulations.

         303. Because of the willful and intentional acts of the individual Defendants, the Plaintiffs and Class Members have experienced extreme emotional distress due to fear of loss of services which their physicians have determined to be medically necessary and fear of harm if they are forced to attend a WAC.

         304. Class Members have been subjected to extreme emotional distress when they were forced to attend WAC's with little to no notice or opportunity to appeal these decisions.

         305. Plaintiffs have experienced fear of retaliation for filing this lawsuit and for advocating for their rights.

         306. Defendants have violated Section 504 by failing to provide Kobe with an ACD and services in an apartment setting and they have violated Mark's right to receive respite services at the pre-January 1, 2010 level and other cost effective home and community based waiver services that allow waiver participants to live in the least restrictive setting.

         307. Plaintiffs and Class Members request a finding that Defendants have violated Section 504 and its implementing regulations and that Defendants pay attorney fees, expenses and costs and such other damages to the Plaintiffs and Class Members, including damages for emotional distress, in such amount as the Court shall determine to be just and fair.

         308. Plaintiffs and Class Members are entitled to reasonable legal fees, costs and expenses of this litigation.

         COUNT THREE VIOLATION OF 42 U.S.C. § 1983 309. Plaintiffs adopt and restate the allegations set forth in the paragraphs above.

         310. At all relevant times herein, Plaintiffs and Class Members have had a right under the Medicaid Act to receive ADHC.

         311. Defendants Haley, Sanford, Cooper, Eckstrom, Chellis, Leatherman, Forkner, Keck, Butkus, Laurent, Buscemi, Lacy, Waring, Chourey, Huntress, Johnson and Leitner are persons who, acting under color of law, have violated the civil rights of the Plaintiffs and Class Members by violating provisions of the Medicaid Act and the constitutional rights of the Plaintiffs and Class Members.

         312. Defendants Butkus, Laurent, Buscemi, Lacy, Waring, Huntress, Chorey and Johnson and others who will be identified during discovery schemed to divert funds from ADHC services to WAC's and to deny the rights of Plaintiffs and Class Members to these and other Medicaid services needed to live in the least restrictive setting.

         313. Acting under the color of law, Defendants worked a denial of the rights and privileges of Plaintiffs and Class Members which are secured by the United States Constitution or by Federal law and which are guaranteed by the Fourth, Fifth, and Fourteenth Amendments to the Constitution of the United States, to wit, they have denied their right to life, liberty and the pursuit of happiness by denying ADHC ...


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