11‐1427
E.M. v. New York City Department of Education
United States Court of Appeals
FOR THE SECOND CIRCUIT
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August Term, 2012
(Argued: February 5, 2013 Decided: July 11, 2014)
Docket No. 11‐1427‐cv
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E.M., AS PARENT AND NATURAL GUARDIAN OF N.M., AN INFANT,
Plaintiff‐Appellant,
–v.–
NEW YORK CITY DEPARTMENT OF EDUCATION,
Defendant‐Appellee.
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B e f o r e:
KEARSE, JACOBS, AND CARNEY, Circuit Judges.
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Plaintiff‐appellant E.M., the parent of a disabled child, brought this action
under the Individuals with Disabilities Education Act, 20 U.S.C. § 1400, et seq.
(the “IDEA”), asserting that defendant‐appellee the New York City Department
of Education (the “Department”) denied her child the free appropriate public
education that the IDEA requires. She seeks direct tuition payment for the 2008‐
2009 school year to the private school where she unilaterally enrolled her child.
The district court (Batts, J.) determined, first, that plaintiff had standing to
pursue her claim for direct payment, although she had not paid any tuition to the
private school. The district court denied plaintiff’s claim on the merits, however,
ruling that the Department’s proposed Individualized Education Program
(”IEP”) would have provided plaintiff’s child a free appropriate public
education. We conclude that: (1) plaintiff has standing to pursue this claim
because she is legally obligated to pay tuition to her child’s private school, even
if that obligation may not be enforced unless and until she is successful in her
legal challenge to the Department’s proffered IEP; and (2) the district court erred
in affirming the decision of the state administrative officer as to the adequacy of
the IEP, because the officer impermissibly relied on retrospective evidence
extrinsic to the IEP in assessing the adequacy of the educational services that
would have been provided by the Department. We therefore VACATE the
judgment in favor of the Department, and REMAND the cause to the district
court for further proceedings in light of our recent case law concerning the
evidence that may be considered in determining the adequacy of an IEP.
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WILLIAM B. ADAMS (Ellison S. Ward, on the brief),
Quinn Emanuel Urquhart & Sullivan, LLP, New York,
NY, for Plaintiff‐Appellant.
JULIE STEINER (Edward F.X. Hart, G. Christopher
Harriss, Brian Reimels, John Buhta, on the brief), for
Michael A. Cardozo, Corporation Counsel of the City
of New York, New York, NY, for Defendant‐Appellee.
Rebecca C. Shore, New York, NY, for amici curiae
Advocates for Children of New York, Legal Services NYC
Bronx, Manhattan Legal Services, New York Lawyers for
the Public Interest, Queens Legal Services, and South
Brooklyn Legal Services in support of Plaintiff‐Appellant.
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SUSAN L. CARNEY, Circuit Judge:
Plaintiff E.M. is a mother with limited financial means who is raising a
severely disabled child in New York City. In 2008, E.M. unilaterally withdrew
her daughter, N.M., from public school and enrolled her in a private learning
center, asserting that the New York City Department of Education (the
“Department”) failed to provide N.M. with the free appropriate public education
that is required by the Individuals with Disabilities Education Act, 20 U.S.C.
§ 1400, et seq. (“IDEA”).1 Although E.M. has not paid — and is likely unable to
pay out‐of‐pocket — any tuition to the private school, she brought this action
against the Department seeking a court order that would direct the Department
to pay the private school, retroactively, the amount of her daughter’s tuition for
the 2008‐2009 school year.
This case raises two independent questions: first, whether E.M. has Article
III standing to sue the Department under the IDEA for direct, retroactive
payment of private school tuition for 2008‐2009; and second, whether E.M.’s legal
challenges to the Department’s proffered Individualized Education Program
1 In 2004, the IDEA was reauthorized and amended by the Individuals with Disabilities
Education Improvement Act (“IDEIA”), Pub. L. No. 108‐446, 118 Stat. 2647. We continue to
refer to the statute, as amended, by the familiar acronym: IDEA.
3
(“IEP”) have merit.2 We answer the first question in the affirmative. Although
there is reason to believe that the school may not seek to enforce the obligation
absent success by E.M. in her IDEA challenge to the Department’s IEP, E.M. was
legally obligated by the enrollment contract that she signed to pay tuition to the
private school. Contrary to the state hearing officer, we conclude that this legal
obligation gives E.M. standing under Article III to pursue her challenge to the
IEP and seek direct retroactive tuition payment. As to the second question, we
determine, based on recent Circuit precedent, that because the state
administrative officer impermissibly relied on retrospective evidence extrinsic to
the IEP in determining that the IEP provided the “free appropriate public
education” (“FAPE”) required by the IDEA,3 the district court erred in affirming
the state officer’s decision. See E.M. v. New York City Dep’t of Educ., No. 09 Civ.
10623 (DAB), 2011 WL 1044905 (S.D.N.Y. Mar. 14, 2011). The record before us,
however, does not permit us to resolve the merits of E.M.’s challenge to the IEP.
2 The decision in this case was held pending the issuance of C.F. ex rel. R.F. v. New York City
Dep’t of Educ., 746 F.3d 68 (2d Cir. 2014), decided March 4, 2014.
3 Congress enacted the IDEA “to ensure that all children with disabilities have available to them
a free appropriate public education . . . designed to meet their unique needs . . . [and] to ensure that
the rights of children with disabilities and parents of such children are protected.” 20 U.S.C.
§ 1400(d)(1)(A)‐(B) (emphasis added).
4
We therefore remand the cause to the district court for further proceedings
consistent with this opinion.
BACKGROUND
I. Factual Background4
A. N.M.’s Disability and Schooling
N.M. was born in March 2002. She is severely autistic. When she had
passed her eighth birthday (in April 2010), she was entirely non‐verbal, had a
limited attention span, and was prone to self‐stimulatory and injurious
behaviors, including drumming her fingers on her lips, “spinning” instead of
walking in a straight line, and continually poking her eyes. She exhibited
potentially harmful “mouthing behaviors,” including placing objects like shaving
cream and chalk in her mouth. She also faced substantial physical limitations,
which required her to use (among other therapies) “fixed ankle foot orthotics” to
prevent her calf muscles from shortening. Joint Appendix (“J.A.”) at 786.
N.M. began attending a private pre‐school called Reach for the Stars
Learning Center (“RFTS” or the “Center”) in 2005, when she was three years of
4 The factual statement is drawn primarily from the district court’s opinion and the
administrative record. It is not subject to dispute by the parties except where noted.
5
age.5 During her time at the Center, N.M. received one‐on‐one (“1:1”) Applied
Behavioral Analysis (“ABA”) therapy throughout the school day.6 It was the
view of the associate educational director of the Center, Helene Wasserman, who
later testified before the state hearing officer, that N.M. was “in need of a one to
one [supervision] at all times. Her behaviors seriously interfere[d] with her
learning . . . [and] she had a lot of self[‐]injurious behaviors that needed a lot of
direct care . . . .” J.A. 575‐76.
In March 2008, a New York City Department of Education Committee on
Special Education (the “Committee”) was convened to create an IEP for N.M. for
her kindergarten year, upcoming in September 2008.7 The IEP prepared by the
Committee recognized that N.M. required “highly intensive” supervision, J.A.
691, but it did not provide for full‐time 1:1 instruction. Instead, it called for N.M.
5 The record is unclear as to whether E.M. paid tuition to RFTS for N.M.’s pre‐school education.
6 ABA is an “intensive one‐on‐one therapy that involves breaking down activities into discrete
tasks and rewarding a child’s accomplishments.” R.E. v. New York City Dep’t of Educ., 694 F.3d
167, 176 (2d Cir. 2012) (internal quotation marks omitted). Instructors adept in ABA “use[ ]
careful behavioral observation and positive reinforcement or prompting to teach each step of
a[n appropriate] behavior.” M.H. v. New York City Dep’t of Educ., 685 F.3d 217, 226 n.5 (2d Cir.
2012).
7 An IEP is a “written statement that sets out the child’s present educational performance,
establishes annual and short‐term objectives for improvements in that performance, and
describes the specially designed instruction and services that will enable the child to meet those
objectives.” M.H., 685 F.3d at 224 (internal quotation marks omitted).
6
to be placed in a special education classroom with a staffing ratio of 6:1:1 (six
students for every one teacher and one paraprofessional), and directed that N.M.
receive instruction on a twelve‐month calendar. It also included a Behavioral
Intervention Plan (“BIP”) for N.M., and it recommended, among other things,
that the Department (1) provide 1:1 occupational therapy for thirty minutes twice
a week; (2) provide 1:1 physical therapy for thirty minutes twice a week; and (3)
provide 1:1 speech and language therapy for forty‐five minutes three times a
week. In other words, under the IEP proffered by the Department, N.M. was
slated to receive a total of four hours and fifteen minutes of 1:1 educational
services each week.
B. Re‐enrollment in RFTS
E.M. evaluated the Department’s recommended public classroom
placement for her daughter in early summer 2008, and found it unsuitable. In
her view, where there were more students than teachers in the classroom, it
would be impossible for her child to receive the very close supervision that she
needed, and which E.M. believed should be 1:1 during the whole school day.
On August 15, 2008, E.M. notified the Department that she would re‐enroll
N.M. at the Center for the 2008‐2009 school year. Three days later, she formally
7
enrolled N.M. there by signing an enrollment contract. The executed contract
provides that E.M. and her husband “assume . . . complete financial
responsibility for the enrollment of [N.M. at RFTS] for the year 2008‐2009,” and
that they agree “to pay when due the Annual Tuition and Fees.” J.A. 759. The
contract specifies an annual tuition of $85,000, but leaves blank the spaces
provided for designating a payment schedule and the amount of a deposit that
“must accompany this signed Contract to make it valid.” Id.
In an affidavit, Nancy Levy, General Co‐Director of RFTS, explained that
as of November 12, 2008, the Center had received no tuition payment for N.M.,
but that the parents and school had agreed that E.M. and her husband would
contact an “advocate or attorney and seek funding” from the Department.8 J.A.
758. E.M. later testified that, as of May 2009, she had not paid any tuition to the
Center for the 2008‐2009 school year because “we don’t have that money to pay
the school.” J.A. 536.9
8 Ms. Levy’s statement appears to refer to an oral side agreement that was never reduced to a
signed writing, and whose exact terms are unclear from the record. The only signed writing
between E.M. and the Center that we see in the record is the enrollment contract itself, which
Levy elsewhere stated constituted “the entire tuition agreement signed by the parent.” J.A. 758.
9 The record suggests that E.M.’s household income during the relevant period was less than
$15,000 per year. See J.A. 539‐40.
8
C. Due Process Complaint
By letter dated November 26, 2008, E.M. (through counsel) submitted to
the Department a request for an impartial hearing under the IDEA. The request
stated that E.M. “rejected the recommended program because she maintains that
[N.M.] requires one to one teaching across all domains to master any skill.” J.A.
750.
D. December 2008 IEP
In December 2008, the Department convened a second Committee and
amended the first proposed 2008‐2009 IEP for N.M., taking into account new
evidence submitted by Department officials who had observed N.M. at the
Center and the reports on N.M.’s progress that were made by Center employees.
The new evidence included a classroom observation report completed by a
Department official, who observed that N.M. “pokes her eyes, bangs her head
and throws herself backwards onto the floor. She is self‐injurious and aggressive
to others. She jumps, gallops and flaps.” J.A. 123. Although the amended IEP
expanded N.M.’s access to related services, it did not alter the Committee’s
previous recommendation that N.M. be placed in a 6:1:1 classroom. J.A. 737.
E.M. renewed her challenge to the Department’s proffered IEP.
9
II. Procedural History
A. IHO Opinion
Between March and May 2009, the Department and E.M. submitted
evidence to an Impartial Hearing Officer (“IHO”) charged with addressing
E.M.’s allegations that, like the earlier IEP, the December 2008 IEP was
substantively deficient because (among other flaws) it did not provide N.M with
all‐day 1:1 supervision.10
In a written opinion issued in June 2009, the IHO denied N.M.’s request for
tuition reimbursement or direct payment to the Center. Declining to address the
substantive question whether N.M. would have received a FAPE in the
educational setting proposed by the IEP, the IHO concluded instead that, as
argued by the Department, E.M. lacked standing to bring a claim for tuition
reimbursement because she “has paid nothing to [RFTS] for Student’s enrollment
there during the 2008‐2009 school year, nor does it appear that [she] is in any
way obligated to do so.” J.A. 192. The IHO found that, when E.M. enrolled her
daughter in RFTS, she was “clearly without the financial resources that would
10
The IHO presides at the IDEA‐mandated “impartial due process hearing,” 20 U.S.C. § 1415(f),
hosted by the local school district — in this case, the New York City Department of Education.
In New York State, the IHO’s decision may be appealed to a State Review Officer. M.H., 685
F.3d at 224‐25.
10
have permitted the incurrence of such debt,” and therefore she had not incurred
any financial risk or obligation. J.A. 191, 193. The IHO further rejected E.M.’s
request for an order directing the Department to pay the Center directly,
reasoning that the IDEA restricts “the right and opportunity to seek recourse
under its provisions solely to parties for whom [the] legislation was intended —
the disabled and the parents of the disabled.” J.A. 193‐94. According to the IHO,
the Center — not E.M. — was the real party in interest with respect to plaintiff’s
direct payment request, and because the Center has no legal remedy under the
IDEA, E.M.’s request for direct payment had to be denied.
B. SRO Opinion
Plaintiff appealed to a State Review Officer (“SRO”), who reviewed the
written record de novo. The SRO agreed with the IHO that E.M. lacked standing
to request that the state pay her daughter’s tuition to the Center for the 2008‐2009
school year. Departing from the IHO’s approach, however, the SRO also chose to
consider, for the first time, “the parent’s allegation that the district did not offer
the student a FAPE during . . . 2008‐09.” J.A. 130.
On that issue, the SRO reviewed the record developed before the IHO and
concluded that “the special education program recommended by the
11
[Department] for the student’s 2008‐09 school year appropriately addressed
[N.M.’s] unique special education needs.” J.A. 137. The SRO found that the
“evidence establishe[d] that the March 5, 2008 IEP was appropriate for the
student because her cognitive, academic, and social delays prevented her from
participation in the general education environment and that the district’s 6:1+1
special class, with programmatic supports, would enable the student to receive
educational benefits.” Id. (internal quotation marks omitted). Although the SRO
did not identify with precision the “programmatic supports” that would render
the 6:1:1 classroom sufficient for N.M. to receive an educational benefit, he relied
in part on testimony from a teacher in N.M.’s proposed public school classroom
who testified at the hearing before the IHO that, in the SRO’s words, “[i]f the
student required 1:1 attention during the entire school day . . . [the teacher]
would make sure that either she or a paraprofessional worked with the student
at all times, having done so previously for another student during the first two
months of the school year, until that student became more independent.” J.A.
136.
12
C. District Court Opinion
On December 31, 2009, E.M. filed suit in Federal District Court for the
Southern District of New York, asserting that the Department had denied her
daughter a FAPE and seeking reversal of the SRO’s decision. Among other
remedies, E.M. sought an order requiring the Department to make direct
payment of N.M.’s tuition for the 2008‐2009 school year to RFTS.
The district court decided, first, that E.M. had standing to bring this suit
even if she had not paid tuition to RFTS. See E.M., 2011 WL 1044905, at *6. In
support of its ruling on standing, the court quoted favorably from another
district court decision within this Circuit, S.W. v. New York City Department of
Education, 646 F. Supp. 2d 346 (S.D.N.Y. 2009), which held that the denial of a
FAPE, without more, constitutes an injury sufficient for a parent to satisfy the
standing requirement. See id. at 359.
Next, the district court addressed whether N.M. had been provided a
FAPE. Because the IHO had not reached this issue, the only relevant factual
findings were made by the SRO as part of its alternative analysis. The district
court ruled that the SRO considered all of the relevant evidence, properly
concluded that N.M. had a possibility of advancement in the 6:1:1 classroom, and
13
did not err in concluding that the IEP was substantively adequate. E.M., 2011
WL 1044905, at *8‐10. As part of its analysis, the district court noted that, at the
time of its decision, no Second Circuit cases “st[ood] for the proposition that an
SRO may not consider evidence extrinsic to the written IEP.” Id. at *9. Therefore,
“[i]t was not error for the SRO to consider [testimony about the nature of the
placement actually offered for N.M. in the IEP],” and the “SRO’s judgment that
the 6:1:1 placement was likely to confer educational benefits is therefore
deserving of deference.” Id.11 The court denied plaintiff’s request that the
Department remit N.M.’s tuition to RFTS.
Plaintiff timely appealed
DISCUSSION
I. Standing
The Department did not cross‐appeal the district court’s ruling on
plaintiff’s standing under Article III to pursue her claim for direct payment.
Because it affects our subject‐matter jurisdiction, however, we are obligated to
consider the question of our own accord.
11 The district court also concluded that the Department had not violated N.M.’s procedural
rights under the IDEA by denying N.M. a Functional Behavioral Assessment. It was deemed
unnecessary because the Department had created a BIP that adequately considered “behavioral
interventions and strategies to the extent required by IDEA.” Id. at *7.
14
A. Background Principles
Article III, Section 2, of the United States Constitution limits federal courts’
jurisdiction to “Cases” and “Controversies.” As part of this limitation, parties
seeking to bring suit in federal court must establish standing under Article III to
assert their claims.
In Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992), the Supreme Court
articulated three separate requirements for constitutional standing. First, the
plaintiff must have suffered an “injury in fact,” — that is, “an invasion of a
legally protected interest which is (a) concrete and particularized and (b) actual
or imminent, not conjectural or hypothetical.” Id. at 560 (internal citations,
quotation marks, and footnote omitted). Second, “there must be a causal
connection between the injury and the conduct” of which the plaintiff complains.
Id. And third, “it must be likely, as opposed to merely speculative, that the
injury will be redressed by a favorable decision.” Id. at 561 (internal quotation
marks omitted). At issue in this case are the first and third of these requirements:
injury in fact and redressability.
Whether a plaintiff has suffered an injury in fact turns neither on the
plaintiff’s subjective experience of the harm she alleges nor on the “merits of the
15
plaintiff’s contention that particular conduct is illegal.” Warth v. Seldin, 422 U.S.
490, 500 (1975); see also William A. Fletcher, The Structure of Standing, 98 Yale L.J.
221, 229‐34 (1988). Rather, whether a plaintiff has standing to assert a claim in
federal court depends on “the nature and source of the claim asserted.” Warth,
422 U.S. at 500; see also W.R. Huff Asset Mgmt. Co. v. Deloitte & Touche LLP, 549
F.3d 100, 106‐07 (2d Cir. 2008). In essence, the standing question is determined
by “whether the constitutional or statutory provision on which the claim rests
properly can be understood as granting persons in the plaintiff’s position a right
to judicial relief.” Warth, 422 U.S. at 500; see generally Richard H. Fallon, Jr., John
F. Manning, Daniel J. Meltzer & David L. Shapiro, HART & WECHSLER’S THE
FEDERAL COURTS & THE FEDERAL SYSTEM 140‐48 (6th ed. 2009) (discussing
Congress’s power to confer standing to sue by statute). “While the injury‐in‐fact
requirement is a hard floor of Article III jurisdiction that cannot be removed by
statute, it has long been recognized that a legally protected interest may exist
solely by virtue of statutes creating legal rights, the invasion of which creates
standing, even though no injury would exist without the statute.” Donoghue v.
Bulldog Investors Gen. P’ship, 696 F.3d 170, 175 (2d Cir. 2012) (internal quotation
marks and citations omitted).
16
As for the third requirement of constitutional standing — that the harm
alleged be redressable by a favorable decision — the Supreme Court has
instructed that the “necessity that the plaintiff who seeks to invoke judicial
power” be in a position to benefit in some personal way “remains an Art. III
requirement.” Simon v. E. Ky. Welfare Rights Org., 426 U.S. 26, 39 (1976); see also
Coal. of Watershed Towns v. EPA, 552 F.3d 216, 218 (2d Cir. 2008) (“‘Relief that
does not remedy the injury suffered cannot bootstrap a plaintiff into federal
court.’” (quoting Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 107 (1998))). A
plaintiff need not demonstrate with certainty that her injury will be cured by a
favorable decision, but she must at least make a showing that there is a
“substantial likelihood that the relief requested will redress the injury claimed.”
Duke Power Co. v. Carolina Envtl. Study Grp., Inc., 438 U.S. 59, 75 n.20 (1978)
(internal quotation marks omitted); see also W.R. Huff, 549 F.3d at 106‐07 (defining
“redressability” as “a non‐speculative likelihood that the injury can be remedied
by the requested relief”). This requirement lies at the core of the standing
doctrine. As commentators have noted, “An abstract decision without remedial
consequence seems merely advisory, an unnecessary expenditure of judicial
resources that burdens the adversary and carries all the traditional risks of
17
making bad law and trespassing on the provinces of the executive and
legislature.” Wright, et al., 13A FED. PRAC. & PROC. § 3531.6 (3d ed. 2008).
B. Standing in the IDEA Context
The IDEA is concerned fundamentally with making educational
opportunities available to disabled children, free of charge to them and their
families. See Florence Cnty. Sch. Dist. Four v. Carter ex rel. Carter, 510 U.S. 7, 13
(1993) (“Carter”) (“IDEA was intended to ensure that children with disabilities
receive an education that is both appropriate and free.”). As the Supreme Court
has explained, the Act also recognizes parents’ unique and personal stake in their
child’s educational progress. In Winkelman ex rel. Winkelman v. Parma City Sch.
Dist., 550 U.S. 516 (2007), for example, the Court held that parents have standing
to pursue IDEA claims on behalf of their child or on their own behalf. Id. at 535.
As the Court there observed, the IDEA “requires, in express terms, that States
provide a child with a free appropriate public education ‘at public expense,’ . . .
including specially designed instruction ‘at no cost to parents.’” Id. at 532
(quoting 20 U.S.C. §§ 1401(9)(A), (29)). The Court concluded that “[p]arents may
seek to enforce this mandate through the federal courts . . . , because among the
rights the[] [parents] enjoy is the right to a free appropriate public education for
18
their child.” Id.; see also Heldman ex rel. T.H. v. Sobol, 962 F.2d 148, 158 (2d Cir.
1992).
The remedies available under the IDEA and the urgency of a child’s
educational needs complicate the applicable standing analysis. For example,
when parents believe the local public school district has denied their child a
FAPE, one option available to them is to keep the child enrolled in public school
and seek administrative (and, later) judicial review of the child’s IEP for the
purpose of obtaining “compensatory” education. See Somoza v. New York City
Dep’t of Educ., 538 F.3d 106, 109 (2d Cir. 2008).12 Courts have long recognized,
however — in light of the irreversibility, in an educational setting, of a child’s
lost time — that parents challenging an IEP may also unilaterally withdraw their
child from the public school district, and obtain “reimburse[ment] . . . for their
expenditures on private special education for [that] child if [a] court ultimately
determines that such placement, rather than a proposed IEP, is proper under the
Act.” Sch. Comm. of Town of Burlington, Mass. v. Dep’t of Educ. of Mass., 471 U.S.
359, 369 (1985) (“Burlington”); see also Carter, 510 U.S. at 15 (stating that, under
12 “‘Compensatory education’ is prospective equitable relief, requiring a school district to fund
education beyond the expiration of a child’s eligibility as a remedy for any earlier deprivations
in the childʹs education.” Somoza, 538 F.3d at 109 n.2.
19
Burlington, parents who “unilaterally change their child’s placement during the
pendency of review proceedings, without the consent of state or local school
officials, do so at their own financial risk,” and “are entitled to reimbursement
only if a federal court concludes both that the public placement violated IDEA
and that the private school placement was proper under the Act” (internal
quotation marks omitted)). Thus, under what has come to be known as the
“Burlington‐Carter test,” parents who have unilaterally placed their child in
private school will be entitled to reimbursement if (1) the school district’s
proposed placement violated the IDEA, (2) the parents’ alternative private
placement is appropriate to meet the child’s needs, and (3) equitable
considerations favor reimbursement. C.F. ex rel. R.F. v. New York City Dep’t of
Educ., 746 F.3d 68, 76 (2d Cir. 2014).13
13 In 1997, following the Supreme Court’s decisions in Burlington and Carter, Congress amended
the IDEA and added a statutory unilateral withdrawal and reimbursement remedy. See 20
U.S.C. § 1412(a)(10)(C)(ii). In Forest Grove School District v. T.A., 557 U.S. 230 (2009), the
Supreme Court examined the 1997 amendments, and held that they did not alter the Burlington‐
Carter framework. See id. at 239‐40. The Court explained that the amendments “preserved the
Act’s purpose of providing a FAPE to all children with disabilities” and “did not change the text
of the provision we considered in Burlington, § 1415(i)(2)(C)(iii), which gives courts broad
authority to grant ‘appropriate’ relief, including reimbursement for the cost of private special
education when a school district fails to provide a FAPE.” Id. at 239. We therefore continue to
look to Burlington and Carter for guidance on the scope of the remedies contemplated under the
IDEA.
20
As the Supreme Court observed in the seminal Burlington decision, the
administrative and judicial review process “is ponderous.” 471 U.S. at 370.
Unilateral withdrawal, therefore, will in most cases be the parents’ most
attractive option when faced with an IEP to which they object:
A final judicial decision on the merits of an IEP will in most
instances come a year or more after the school term covered by that
IEP has passed. In the meantime, the parents who disagree with the
proposed IEP are faced with a choice: go along with the IEP to the
detriment of their child if it turns out to be inappropriate or pay for
what they consider to be the appropriate placement. If they choose
the latter course, which conscientious parents who have adequate means
and who are reasonably confident of their assessment normally would, it
would be an empty victory to have a court tell them several years
later that they were right but that these expenditures could not in a
proper case be reimbursed by the school officials.
Id. (emphasis added). Faced potentially with years of litigation to correct an IEP
they consider deficient, parents have every incentive to enroll their child in a
more suitable school environment while the review process takes its course.
In the quoted text, the Burlington Court seemed to cast the unilateral‐
withdrawal option as being available — as a practical matter — only to
“conscientious parents with adequate means” to foot the bill for private school
tuition while their IDEA claims are adjudicated. Id. (emphasis added). But the
question we encounter here — whether such a remedy is available under the
21
IDEA to parents without adequate means — was not the Burlington Court’s focus.
The IDEA promises a free appropriate education to disabled children without
regard to their families’ financial status.
As represented in briefs by amici: “Low‐income parents — unlike parents
with more resources — cannot afford to pay for tuition at an appropriate private
school and seek reimbursement later,” but there are some private schools that
“are willing to allow low‐income students to begin attending without an
advanced tuition payment while the students’ parents pursue their due process
remedies [under the IDEA].” Amici Curiae Letter Br. of Advocates for Children of
New York, Legal Services NYC Bronx, Manhattan Legal Services, New York
Lawyers for the Public Interest, Queens Legal Services, and South Brooklyn
Legal Services in support of Plaintiff‐Appellant (“Amici Letter Br.”) at 4.
Recognizing this practice, a growing number of our district courts have recently
held that the IDEA permits courts, in appropriate cases, not only to order
“reimbursement” of tuition costs to parents, but also to order retrospective
payment of tuition directly to the private school where a parent has unilaterally
22
enrolled her child.14 See, e.g., Mr. & Mrs. A. ex rel. D.A. v. New York City Dep’t of
Educ., 769 F. Supp. 2d 403, 428 (S.D.N.Y. 2011) (Gardephe, J.) (“Mr. & Mrs. A.”)
(“Where, as here, parents lack the financial resources to ‘front’ the costs of
private school tuition, and in the rare instance where a private school is willing
to enroll the student and take the risk that the parents will not be able to pay
tuition costs — or will take years to do so — parents who satisfy the Burlington
factors have a right to retroactive direct tuition payment relief.”).15
14 Although E.M. is seeking “retroactive,” rather than “prospective,” funding of tuition, we note
that courts have long held that, when a state‐level administrative authority determines that a
proposed IEP is inadequate and the disabled child lacks the financial means to meet the cost of
private‐school tuition pending a final decision on the merits, courts may order the public school
district to pay, prospectively, the cost of private‐school tuition as the administrative and judicial
process unfolds. See, e.g., Susquenita Sch. Dist. v. Raelee S. ex rel. Heidi S., 96 F.3d 78, 85‐87 (3d
Cir. 1996) (“The purpose of the Act, which is to ensure that every child receive a ‘free and
appropriate education’ is not advanced by requiring parents, who have succeeded in obtaining
a ruling that a proposed IEP is inadequate, to front the funds for continued private education.”);
see also Connors v. Mills, 34 F. Supp. 2d 795, 802‐06 (N.D.N.Y. 1998) (stating, in dicta, that when
the Burlington‐Carter factors are met, the IDEA permits district courts to order prospective
funding for a unilateral placement in appropriate circumstances).
15 See also P.K. ex rel. S.K. v. New York City Dep’t of Educ., 819 F. Supp. 2d 90, 118 (E.D.N.Y. 2011)
(Johnson, J.) (“[W]here the parents have prevailed on each of the three prongs of the Burlington‐
Carter test, the IDEA authorizes a court ‘to award retroactive direct payment of private school
tuition.’” (quoting Mr. & Mrs. A., 769 F. Supp. 2d at 427)), affʹd, 526 F. App’x 135 (2d Cir. 2013);
W.W. v. New York City Dep’t of Educ., No. 12 Civ. 7196, 2014 WL 1330113, at *2 (S.D.N.Y. Mar. 31,
2014) (Torres, J.) (“If the parent lacks the financial resources necessary to front the costs of
private school tuition, the parent may request direct retroactive payment to the private
school.”); A.R. ex rel. F.P. v. New York City Dep’t of Educ., No. 12 Civ. 4493, 2013 WL 5312537, at
*10‐11 (S.D.N.Y. Sept. 23, 2013) (Crotty, J.) (agreeing with “Judge Gardephe’s well‐reasoned
opinion in Mr. & Mrs. A. that a court’s broad discretion to grant such relief as is appropriate
under 20 U.S.C. § 1415(i)(2)(C)(iii) includes the power, in a proper case, to award retroactive
direct payment of private school tuition” (internal quotation marks and alternations omitted)).
23
In this case, both parties agree (as do we) that the broad spectrum of
equitable relief contemplated under the IDEA encompasses, in appropriate
circumstances, a “direct‐payment” remedy.16 Cf. Frank G. v. Board of Educ. of Hyde
Park, 459 F.3d 356, 371 (2d Cir. 2006) (noting that the IDEA “confer[s] broad
discretion on the district court to grant relief it deems appropriate to parents of
disabled children who opt for a unilateral private placement” (citing 20 U.S.C. §
1415(i)(2)(C)(iii))). Indeed, where the equities call for it, direct payment fits
comfortably within the Burlington‐Carter framework: like reimbursement, direct
payment to the private school that provided the required educational program
“merely requires [the school district] to belatedly pay expenses that it should
have paid all along and would have borne in the first instance had it developed a
proper IEP.” Burlington, 471 U.S. at 370‐71. It also furthers the IDEA’s remedial
purposes by extending the unilateral withdrawal option to parents with limited
financial means, who otherwise could not avail themselves of it. See id. at 372
(“The [IDEA] was intended to give handicapped children both an appropriate
16 The Department informs us that, “[w]hile [it] agree[s] that direct payment to a private school
is an appropriate remedy under the IDEA under certain circumstances, see Mr. and Mrs. A v.
New York City Dept. of Educ., 769 F. Supp. 2d 403 (S.D.N.Y. 2011), such action must be made
contingent upon a showing by the plaintiff of a legal obligation to pay the school should the
plaintiff’s attempt at payment [through IDEA litigation against the Department] be
unsuccessful, lest the standing requirement be rendered a nullity.” Appellee’s Letter Br. at 2.
24
education and a free one; it should not be interpreted to defeat one or the other of
those objectives.”).
Applying the direct‐payment remedy in practice, however, highlights
some of the tensions between the statutory enforcement mechanisms available
under the IDEA and the standing requirements of Article III. If the parents of a
special needs child who is enrolled in a private school have not paid tuition and
are not legally obligated to do so, then their standing to pursue IDEA remedies
may be called into question. As discussed above, we must ask whether they
have suffered an injury in fact. And even if they have, we must inquire further
as to how direct tuition funding will redress this injury.
The parties have directed us to only a handful of cases that have addressed
these or similar questions. In deciding that E.M. satisfied the elements of
constitutional standing, the district court here relied primarily on S.W. v. New
York City Department of Education, 646 F. Supp. 2d 346 (S.D.N.Y. 2009). There, the
district court faced the question whether a parent who alleged that her child had
been denied a FAPE had standing to seek direct payment of her child’s tuition to
the private school where she had unilaterally enrolled her child. See id. at 354‐55.
The court set out the standing problem before deciding that standing existed.
25
The parent’s contract with the private school recited that the parent was
“dependent upon receiving prospective payment from [the district] in order to
make the payment of tuition.” Id. at 357 (alterations omitted). The court
therefore determined that the plain language of the contract “relieved S.W. of
financial responsibility in the event that the [the district] refused to pay her son’s
2005‐2006 tuition.” Id. at 358. Further, because the parent had “not submitted
any evidence that [the private school] believes her to be responsible for tuition
payment, nor that they would otherwise seek to hold her liable for
noncompliance with the contract,” the court concluded that the parent had not
asserted an injury in fact based on any financial indebtedness to the private
school. Id.
Nonetheless, the court in S.W. ultimately decided that the parent had
standing to assert her claims. Her injury in fact arose not from a financial
obligation to the private school, the court reasoned, but from her statutory right
to receive a free and appropriate education for her child, at public expense. See
id. at 358‐59. The school district argued that this type of injury could not be
redressed by the relief there requested — direct payment to the private school.
26
But the court dismissed this argument in light of the language and structure of
the IDEA:
The IDEA requires school districts to provide disabled children with
a FAPE, which is defined by the statute, in relevant part, as “special
education and related services that . . . have been provided at public
expense . . . .“ Here, it is undisputed that [the child] received an
appropriate education at [the private school], but importantly, that
education was not provided at public expense. If the Court orders
the [district] to pay [the child’s] tuition to [the private school], as [the
parent] requests, [the child] will have received a FAPE, that is, an
appropriate education at public expense.
Id. at 359 (quoting 20 U.S.C. § 1401(9)).
The Fourth Circuit reached a different conclusion in Emery v. Roanoke City
School Board, 432 F.3d 294 (4th Cir. 2005), a case relied on by the Department. In
Emery, after the public school district failed to prepare an IEP, the father of a
disabled child sought reimbursement for payments in amounts totaling over
$200,000 that were made to a private, residential educational institution. See id.
at 296‐97. The father’s medical insurer had paid the charges for the child’s six‐
month stay in the facility, however, and the father first sought reimbursement for
the insurer’s costs years after the payments were made. The Fourth Circuit
concluded that the father lacked standing to seek reimbursement for the insurer’s
payments. See id. at 299‐300.
27
In reaching that conclusion, the Emery Court addressed the two injuries‐in‐
fact that might arise from a district’s failure to provide a disabled child with the
educational services she requires: denial of a FAPE and financial injury. The
court reasoned that although a plaintiff may allege an injury in fact arising solely
from the denial of a FAPE, the denial of that FAPE was not redressable by the
requested relief of tuition payments for an educational term already long passed.
See id. at 299. In addition, because the plaintiff “waited numerous years to bring”
the suit, there would be no way for the district to remedy its past failure to
provide a FAPE through the provision of remedial services. Id. The court further
held that, although a plaintiff may allege a financial injury arising from the
outlay of personal funds to pay for private education, since this injury “is a
subsidiary of and dependent upon the child’s failure to receive a proper
education under the IDEA,” the plaintiff in Emery failed to establish that he
suffered any form of monetary loss. Id. “Crucially for the purposes of standing,”
the court held, “he suffered no out‐of‐pocket loss himself for the services that
[the private institution] provided,” and he “failed to show how awarding him
[reimbursement] would be anything other than a windfall.” Id.
28
C. Application Here
1. The Parties’ Arguments
The Department argues here that the district court erred in concluding that
plaintiff had standing to pursue a direct‐payment remedy. Adopting the view
that “plaintiff’s claimed denial of a FAPE is her grievance, [but her] injury in fact
for purposes of determining standing can only be viewed in financial terms,”
Appellee’s Letter Br. at 2, the Department argues that the evidence —
particularly the affidavit from Nancy Levy, General Co‐Director of RFTS —
supports the conclusion that plaintiff has neither paid the Center tuition nor is
obligated to do so. The Department contends, “[W]here a plaintiff has paid
nothing to the school and, more importantly, where there is no evidence that the
plaintiff is even obligated to do so in the future . . . an award of direct payment to
the private school, while theoretically righting [plaintiff’s] grievance in the
abstract, does nothing to redress any actual, concrete injury suffered by the
plaintiff.” Id.
Plaintiff and her amici counter that E.M. has suffered two independent
injuries. First, relying heavily on S.W., plaintiff argues that she has suffered an
injury in fact arising solely from the Department’s failure to provide her child
29
with a publicly funded FAPE. Second, she argues that she is in fact financially
obligated to the Center, and that the Center — in the Department’s stead — did
provide an appropriate education. She cites to the plain language of the duly
executed enrollment contract, which (as described above) provides that E.M. and
her husband “assume, jointly and severally, complete financial responsibility for
the enrollment [of their child] in [RFTS] for the year 2008‐2009 and agree to pay
when due the Annual Tuition and Fees.” J.A. 759‐61. This financial obligation,
she contends, creates an injury in fact.
Direct payment of tuition would redress both of these injuries, according
to E.M. With regard to the denial of a FAPE, direct payment would ensure that
plaintiff’s child was provided a free appropriate public education in 2008‐2009 at
public expense, as provided for by the statute. With regard to plaintiff’s financial
injury, direct payment would relieve plaintiff of her obligation to pay tuition to
the Center.
2. Plaintiff Has Standing to Seek Direct Payment under the IDEA
Based on Her Contractual Obligations to RFTS
Based on the record before us, we conclude that plaintiff has standing to
seek direct retrospective tuition payment to the Center. As an initial matter, we
30
note our agreement with plaintiff and her amici that E.M.’s claimed denial of a
FAPE constitutes an injury in fact, and not merely a “grievance,” as the
Department contends. But we need not decide today the thorny question
whether the denial of a publicly funded FAPE, standing alone, is an injury that is
“redressable” by an order requiring the Department to pay the child’s private‐
school tuition directly.17 Rather, the record provides a narrower ground for our
decision, albeit one the district court did not reach in the first instance.18 In our
view, plaintiff has adequately demonstrated that, as a result of the Department’s
alleged failure to provide a FAPE, she has incurred a financial obligation to RFTS
under the terms of the enrollment contract. Plaintiff’s contractual obligation
itself constitutes an “injury in fact” for Article III purposes, one that is
“redressable” by the direct tuition payment she seeks.
17 We therefore express no opinion on the standing analysis espoused in S.W. (and relied upon
by the district court below), resting solely on the IDEA’s statutory language requiring that a
FAPE be provided “at public expense.” See S.W., 646 F. Supp. 2d at 359; E.M., 2011 WL 1044905,
at *6.
18 We may, of course, affirm the district court’s decision on any ground sufficiently presented by
the record. See Olsen v. Pratt & Whitney Aircraft, 136 F.3d 273, 275 (2d Cir. 1998) (“It is well
settled that we may affirm on any grounds for which there is a record sufficient to permit
conclusions of law, including grounds not relied upon by the district court.” (internal quotation
marks omitted)).
31
Relying on the language of the contract as well as extrinsic evidence such
as Levy’s affidavit and plaintiff’s financial condition, the IHO and the SRO
concluded that the agreement between the parties did not actually require
plaintiff to pay N.M.’s tuition to RFTS, and therefore supplied no basis on which
plaintiff could assert standing to sue for direct payment.19 Although “[w]e must
give due weight to the state proceedings, mindful that we lack the specialized
knowledge and experience necessary to resolve questions of educational policy,”
R.E. v. New York City Dep’t of Educ., 694 F.3d 167, 189 (2d Cir. 2012) (internal
quotation marks and alteration omitted), we need not defer to the findings of
state administrative officers on questions, such as contract interpretation or the
requirements of standing, that fall outside of their field of expertise, see M.H. v.
New York City Dep’t of Educ., 685 F.3d 217, 244 (2d Cir. 2012) (observing that the
weight due administrative determinations “will vary based on the type of
determination at issue”); see also Lillbask ex rel. Mauclaire v. Conn. Dep’t of Educ.,
397 F.3d 77, 82 (2d Cir. 2005) (explaining that the “due weight we ordinarily
must give to the state administrative proceedings is not implicated with respect
As noted supra, the IHO and SRO also found that, because plaintiff had not paid any tuition
19
out of pocket, she lacked standing to seek tuition “reimbursement.” J.A. 129, 192. On appeal,
however, plaintiff has made clear that she is not seeking “reimbursement,” in the literal sense,
for herself, but rather “direct payment” of tuition to RFTS.
32
to issues of law” (internal quotation marks and alterations omitted)). These
matters fall within the purview of the lawyer’s expertise, not that of the educator.
In this case, we disagree with the IHO’s and SRO’s analysis, for Article III
standing purposes, of the contractual arrangement entered into by E.M. and the
Center. We conclude, first, that E.M. has made an adequate showing, based on
the unambiguous language of the enrollment contract, that she is obligated to
pay (or, at the very least, risks potential civil liability should she fail to pay)
tuition to the Center, regardless whether she is successful in obtaining funding
from the Department under the IDEA. In our view, that financial obligation,
incurred as a result of an allegedly inadequate IEP, satisfies the requirements for
standing. But even assuming, as the administrative officers did here, that E.M.
has no obligation to pay tuition unless and until she succeeds in her litigation
against the Department, we nonetheless conclude that E.M. has standing to bring
this claim based on the implied contractual obligation to use her best efforts to
pursue her statutory remedies to repay the tuition that the Center has, in effect,
“loaned” to her during the 2008‐2009 school year. Our reasoning is explained
below.
33
a. Plaintiff’s Contractual Obligation to Pay Tuition Absent Success
in Her IDEA Litigation Against the Department
First, contrary to the determinations of the IHO and SRO, we conclude that
E.M. has standing to pursue a claim for direct payment under the IDEA based on
her contractual obligation to pay private‐school tuition. E.M. has made an
adequate showing that her contract with the Center requires her to pay tuition
even if her IDEA claim against the Department fails to result in funding.
A plain‐language reading of the written enrollment contract, see Kass v.
Kass, 91 N.Y.2d 554, 566‐67 (1998),20 reveals that plaintiff has accepted a legally‐
enforceable obligation to pay tuition to RFTS. Indeed, pursuant to that contract,
plaintiff has assumed, without qualification, “complete financial responsibility
for the enrollment” of her child at the Center, and “agree[d] to pay” tuition and
fees. J.A. 759. Thus, unlike the plaintiff in S.W., whose enrollment contract with
the private school “plain[ly] . . . relieved [the parent] of financial responsibility in
the event that the [the Department] refused to pay her son’s 2005‐2006 tuition,”
S.W., 646 F. Supp. 2d at 358, E.M.’s written contract with the Center nowhere
conditioned her tuition liability on her ability to obtain funding from the
Department, cf. id. at 357‐58 (concluding that parent lacked standing to seek
20 There is no dispute that New York law governs the enrollment contract at issue.
34
direct payment under the IDEA based on any financial indebtedness to the
school where the enrollment contract expressly provided that parent was
“dependent upon receiving prospective payment from [the Department] . . . in
order to make the payment of tuition,” and that the school “has assumed the risk
that the Parent may not receive prospective payment from [the Department]”
(alterations omitted)).
It is true that certain portions of the enrollment contract — including the
payment schedule and the deposit amount — were left blank. See J.A. 759. But
we are not persuaded that these blank spaces, in a standard‐form contract,
render the parties’ entire agreement void. The contract’s essential terms —
namely, the educational services to be provided and the amount of tuition —
were plainly set out in the written agreement, and we cannot agree that the
contract, read as a whole, is so vague or indefinite as to make it unenforceable as
a matter of law. See, e.g., Best Brands Beverage, Inc. v. Falstaff Brewing Corp., 842
F.2d 578, 587‐88 (2d Cir. 1987) (“Although courts are loath to refuse enforcement
of agreements on indefiniteness grounds, if the terms of the agreement are so
vague and indefinite that there is no basis or standard for deciding whether the
agreement had been kept or broken, or to fashion a remedy, and no means by
35
which such terms may be made certain, then there is no enforceable contract.”
(internal citation and quotation marks omitted)); Cobble Hill Nursing Home, Inc. v.
Henry & Warren Corp., 74 N.Y.2d 475, 482‐83 (1989) (stating that the requirement
of definiteness “is necessarily flexible, varying for example with the subject of the
agreement, its complexity, the purpose for which the contract was made, the
circumstances under which it was made, and the relation of the parties”).21
The administrative officers, however, rejected this plain‐language
interpretation of the enrollment contract based primarily on Nancy Levy’s
statement in her affidavit that, as of November 12, 2008, “[n]o tuition has been
received for [N.M.] in accordance with an agreement that [E.M.] would contact
an advocate or attorney and seek funding” from the Department. J.A. 758. The
IHO and SRO appeared to treat Levy’s testimony as evidence of an oral side
agreement between the parties that modified the terms of the enrollment contract
so that E.M. would not be required to pay tuition unless and until she recovers a
Moreover, it is undisputed that the Center fully performed its obligations under the
21
enrollment contract by providing the promised educational services during the 2008‐2009
school year. Thus, even if the writing itself is incomplete, the Center’s performance of its
contractual obligations (and plaintiff’s acceptance of them) arguably evidence a mutual intent to
consummate the agreement, thereby triggering plaintiff’s reciprocal obligation to pay tuition.
See, e.g., Arbitron, Inc. v. Tralyn Broad., Inc., 400 F.3d 130, 136‐38 (2d Cir. 2005) (noting that, under
New York law, even where some terms are left open, so long as there is sufficient evidence that
both parties intended to be bound, the agreement will be enforced).
36
judgment against the Department. See id. at 129, 191‐93. On that basis, the
administrative officers concluded that E.M. had no real stake in the outcome of
this litigation, and therefore lacked standing to pursue her claims. See id. at 130,
193‐94. We disagree with that assessment.
To begin, the IHO’s and SRO’s reliance on the Levy affidavit to rewrite the
terms of the enrollment contract is misplaced. Although Levy testified that E.M.
had not yet paid tuition “in accordance with an agreement” to seek funding
under the IDEA, J.A. 758, Levy’s affidavit is silent on E.M.’s payment obligations
should her efforts to obtain public funding fail; indeed, there is nothing in the
record to suggest that, if plaintiff’s IDEA claim proves fruitless, she is
automatically relieved of her contractual promise to pay tuition, cf. S.W., 646 F.
Supp. 2d at 357 (parent lacked standing based on financial indebtedness where
the enrollment contract “plainly relieved [parent] of responsibility for the cost of
her son’s tuition”). Thus, while the Levy affidavit may be evidence that the
Center agreed to forbear on payment during the pendency of plaintiff’s IDEA
litigation against the Department, we cannot conclude that its current
forbearance conclusively evidences an intention to waive its contractual rights
altogether or to forgo enforcement in the future: so long as the limitations period
37
has not run, a creditor’s willingness to be patient with a debtor does not, by itself,
render this debt unenforceable as a matter of law. See, e.g., WMW Mach., Inc. v.
Werkzeugmaschinenhandel GmbH IM Aufbau, 960 F. Supp. 734, 748 n.11 (S.D.N.Y.
1997) (stating that, under New York law, “[t]he intention to waive [contractual
rights] must be clearly established and cannot be inferred from doubtful or
equivocal acts or language” (citing E. 56th Plaza, Inc. v. Abrams, 458 N.Y.S.2d 953,
955 (App. Div. 3d Dep’t 1983))); see also Beth Israel Med. Ctr. v. Horizon Blue Cross
& Blue Shield of N.J., Inc., 448 F.3d 573, 585 (2d Cir. 2006) (“[W]aiver requires a
‘clear manifestation of an intent by plaintiff to relinquish her known right’ and
‘mere silence, oversight or thoughtlessness in failing to object’ to a breach of the
contract will not support a finding of waiver.” (quoting Courtney‐Clarke v. Rizzoli
Int’l Publ’ns, Inc., 676 N.Y.S.2d 529, 529 (App. Div. 1st Dep’t 1998))).
Moreover, even if the Levy affidavit could be interpreted to suggest that
the parties orally agreed to modify the written enrollment contract to relieve
E.M. of tuition liability, it is unclear whether E.M. could effectively rely on that
purported modification to defend against an action on the contract, should the
Center later sue her for nonpayment, or (hypothetically) if the Center should
change management, or if it should enter bankruptcy and the trustee seek to
38
collect. Notably, the written enrollment contract signed by both parties
contained an express merger clause, which provided as follows: “This
Enrollment Contract contains the entire material terms and conditions” and “no
others will be deemed valid unless they are contained in an express writing
signed by [the parent] and the School.“ J.A. 761. Accordingly, as a matter of
New York law (which governs the enrollment contract), any side agreements
between the parties that were not reduced to a signed writing do not — and
indeed cannot — modify or negate plaintiff’s legal responsibility under the
contract to pay the cost of tuition. See, e.g., Schron v. Troutman Sanders LLP, 20
N.Y.3d 430, 436 (2013). Thus, because the written enrollment contract appears to
be enforceable notwithstanding any purported oral modifications, E.M. has, at
the very least, demonstrated a well‐founded basis for fearing exposure to suit for
nonpayment. See, e.g., Ross v. Bank of Am., N.A. (USA), 524 F.3d 217, 222 (2d Cir.
2008) (stating that injury in fact “is a low threshold,” and “may simply be the fear
or anxiety of future harm” (internal quotation marks omitted)); cf. S.W., 646 F.
Supp. 2d at 358 (observing that “potential civil liability can constitute an injury in
fact,” but concluding that the plain language of the enrollment contract at issue
there “relieved [the parent] of financial responsibility”).
39
In light of the above, we conclude that E.M. has made an adequate
showing, for standing purposes, that she is subject to a contractual obligation to
pay private‐school tuition to RFTS, and that she incurred that obligation as a
direct result of the Department’s alleged failure to provide her child a FAPE.
That contractual obligation amounts to an injury in fact that can be redressed by
a favorable decision in this case: if (after the underlying merits question is
adjudicated) the Department is required to pay N.M.’s tuition at RFTS, then
plaintiff is no longer obligated to do so. Once relieved of that obligation, she no
longer risks being sued for nonpayment or suffering any of the negative effects
associated with carrying such a debt.22 In short, a favorable decision would
make plaintiff whole. Under these circumstances, E.M. has satisfied Article III’s
standing requirements, and may pursue her claim against the Department.
b. Plaintiff’s Contractual Obligation to Seek Funding Under the
IDEA to Repay Tuition “Loaned” to Her by the Center
Second, even assuming, arguendo, that the oral agreement alluded to by the
administrative officers below did modify the enrollment contract, so that E.M. has
no obligation to pay tuition unless she succeeds in her IDEA litigation against the
These might include, for example, effects on her borrowing capacity for other purposes, or her
22
relationship with the Center in future years, both with respect to N.M.’s education and the
education of one or more of her other children. Indeed, the record reflects that E.M. is the
mother of a second, severely disabled child. See J.A. 536‐37.
40
Department, we nonetheless conclude that E.M. has standing to bring her claim
for direct payment. Even under such a modified contractual arrangement, E.M.
has impliedly promised to use her best efforts to pursue her statutory remedies
to recoup the cost of tuition and repay the Center. And while this arrangement
means the Center — rather than E.M. — ultimately bears the risk that E.M.’s
litigation against the Department will be unsuccessful, we are not persuaded that
this fact necessarily renders the Center the real party in interest, as the
administrative officers concluded, or that it otherwise prevents E.M. from
pursuing her remedies under the IDEA. Rather, such an arrangement may fairly
be interpreted as a “loan” provided by the Center to E.M. — in the form of
tuition — with forbearance in exchange for her promise to pursue recompense
from the Department that will, in turn, extinguish her debt.
An agreement of this type is roughly analogous to a familiar insurance
arrangement known as a “loan receipt.” See, e.g., 16 COUCH ON INS. § 222:91 (3d
ed. 2012). Under such an arrangement, when an insured suffers a loss at the
hands of a third‐party tortfeasor, “the insurer lends the insured the amount due
on the policy, and the insured pays it back only to the extent that the insured is
able to obtain a recovery against [the third‐party].” Wright, et al., 6A FED. PRAC.
41
& PROC. § 1546. Although the insured is, in essence, suing for the benefit of the
insurer, by virtue of the loan receipt the insurer “has not paid the insured’s claim
and therefore is not subrogated to the insured’s rights.” Id. Thus, the insured —
not the insurer — has been recognized as the proper party to bring suit. See 16
COUCH ON INS. § 222:91 (“Under the loan receipt relationship, the insurer does
not have standing to sue the third party and any such actions would be
dismissed for lack of standing or failure to state a cause of action.”).
The loan receipt arrangement has long been judicially accepted as a valid
mechanism for providing coverage for an insured’s losses while allowing her to
sue tortfeasors in her own name. See, e.g., Luckenbach v. W.J. McCahan Sugar
Refining Co., 248 U.S. 139, 149 (1918) (describing the loan‐receipt arrangement as
“consonant both with the needs of commerce and the demands of justice”); Aetna
Ins. Co. v. Henry Du Bois Sons Co., 144 F.2d 262, 264 (2d Cir. 1944) (stating that “a
[loan] receipt is a lawful contract which will be enforced”); see also Columbia
Grain, Inc. v. Or. Ins. Guar. Ass’n, 22 F.3d 928, 931 (9th Cir. 1994) (explaining that
“with a loan receipt, the insured makes the claim against the third party but may
be contractually bound to give the money recovered to the insurer”).
42
Viewed in this light, the reality that the Center ultimately bears the risk of
plaintiff’s non‐recovery from the Department is merely a consequence of the
contractual arrangement between it and E.M., and does not dislodge E.M. as the
real party in interest. Cf. 17 COUCH ON INS. § 241:42 (“An insured, who agrees to
sue the one responsible for the damage for the benefit of the insurer, may bring
an action for such damages in his or her own name without violating a statutory
provision requiring every action to be brought in the name of the real party in
interest.”). Further, unlike the insurance payments made to the private
educational facility in Emery, which left the plaintiff there with no obligation of
record either to the school or the insurer, the Center’s “loan” arrangement with
E.M. obliges her to pursue diligently her statutory remedies under the IDEA, and
to remit to the Center any recovery she might obtain as a result of her litigation
against the Department. Thus, if E.M. prevails on her claims, and is awarded
funding from the Department, she will not receive a “windfall,” cf. Emery, 432
F.3d at 299; rather, she will merely repay a debt incurred as a result of the
Department’s allegedly inadequate IEP.
In sum, we conclude that, because of her contractual obligation to pay
tuition to the Center, E.M. has standing to pursue this claim against the
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Department, even if the Center may choose not to act upon that obligation unless
and until E.M. prevails in her litigation against the Department.
Of course, that plaintiff has standing to pursue her claim does not mean
that she is entitled to the relief she seeks. As we have noted, even if a plaintiff
satisfies the Burlington‐Carter prerequisites, “because the authority to grant
reimbursement [under the IDEA] is discretionary, ‘equitable considerations . . .
are relevant in fashioning relief.’” Frank G., 459 F.3d at 363‐64 (quoting
Burlington, 471 U.S. at 374); see also Forest Grove Sch. Dist. v. T.A., 557 U.S. 230,
246‐47 (2009) (stating that, even if a plaintiff establishes a right to reimbursement
under the IDEA, “courts retain discretion to reduce the amount of a
reimbursement award if the equities so warrant”). In making that equitable
determination, the district court may consider many factors, including, inter alia,
whether plaintiff’s unilateral withdrawal of her child from the public school was
justified, whether plaintiff provided the Department with adequate notice of the
withdrawal, whether the amount of private‐school tuition was reasonable,
whether plaintiff should have availed herself of need‐based scholarships or other
financial aid from the private school, and whether there was any fraud or
collusion in generating (or inflating) the tuition to be charged to the Department,
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or whether the arrangement with the school was fraudulent or collusive in any
other respect. These factors, however, bear not on our standing analysis under
Article III, but on the equities of plaintiff’s claim for relief.
II. Merits
Having concluded that plaintiff has standing to pursue a claim for direct
tuition payment to the Center, we now turn to the merits of this dispute. The
district court determined that E.M. failed to establish that N.M.’s IEP was either
procedurally or substantively inadequate. See E.M., 2011 WL 1044905, at *7‐10.
Most important for our purposes here, during the course of its analysis of the
substantive adequacy of the IEP and whether a 6:1:1 classroom setting would
provide an appropriate education, the district court appeared to credit evidence
submitted by E.M. that her daughter needed “constant supervision.” Id. at *8
(internal quotation marks omitted). But the court concluded that the SRO had
not erred in approving the 6:1:1 setting. In so doing, the SRO relied in part on
testimony from a teacher at N.M.’s proposed public school classroom that the
child would be provided with sufficient supervision in the classroom setting —
supervision that would approximate 1:1 when needed. See id. at *9. The teacher
offered testimony, as described above, “about the nature of the placement
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actually offered for N.M. in the IEP.” Id. (emphasis added). According to the
court, “[i]t was not error for the SRO to consider such evidence.” Id. In making
this determination, however, the court noted that, as of the date of its decision,
there had been no case from within the Second Circuit “that st[ood] for the
proposition that an SRO may not consider evidence extrinsic to the written IEP.”
Id.
That context has now changed. In 2012, our Court issued an opinion in
R.E. v. New York City Department of Education, 694 F.3d 167 (2d Cir. 2012), in
which we expressly addressed whether a district court or state officer may
consider and rely on evidence extrinsic to the IEP when deciding whether an
educational program provides a disabled child with a FAPE, and adopted “the
majority view that the IEP must be evaluated prospectively as of the time of its
drafting and . . . that retrospective testimony that the school district would have
provided additional services beyond those listed in the IEP may not be
considered.” Id. at 186. By way of example, we explained that “testimony may
be received that explains or justifies the services listed in the IEP,” id., but the
district “may not introduce testimony that a different teaching method, not
mentioned in the IEP, would have been used,” id. at 186‐87.
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Particularly relevant to this case, we noted in R.E. that “if a student is
offered a staffing ratio of 6:1:1, a school district may introduce evidence
explaining how this structure operates and why it is appropriate.” Id. at 187. But
“[i]t may not introduce evidence that modifies this staffing ratio (such as
testimony from a teacher that he would have provided extensive 1:1 instruction
to the student).” Id.; see also C.F., 746 F.3d at 79‐80 (“Because the IEP must be
evaluated prospectively, without recourse to retrospective testimony, the
Department cannot cure [a deficient IEP that failed to include parent counseling
or training] by offering testimony that counseling and training would have been
offered.” (citing R.E., 694 F.3d at 193)). This rule reasonably protects parents who
must assess a proffered IEP without the benefit of after‐the‐fact testimonial
modifications.
Here, the SRO relied on testimony from N.M.’s proposed teacher that (as
the SRO characterized it) explained how the teacher could “make sure that either
[the teacher] or a paraprofessional worked with the student at all times, having
done so previously for another student during the first two months of the school
year.” J.A. 136. In other words, the SRO relied expressly on the possibility,
extrinsic to any written education plan, that the teacher in the proposed 6:1:1
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classroom would provide 1:1 services beyond those specified in the IEP —
precisely what R.E. determined to be impermissible.
The parties urge us to reach the merits of this case notwithstanding this
error. We certainly appreciate their desire to resolve this case now without
further litigation, with its attendant delays and costs. But we must decline this
invitation. It would be imprudent for this panel, without any educational
expertise, to decide the merits of E.M.’s claim on a cold record. Cf. M.H., 685 F.3d
at 244 (stating that a court’s review of administrative findings in the IDEA
context must “be colored by an acute awareness of institutional competence and
role”). We agree with E.M. that considerable record evidence supports the
conclusion that, in the 2008‐2009 school year, N.M. needed constant 1:1 care to
progress. But, as the Department points out, both the Committee social worker
and the teacher in the recommended classroom testified that N.M. could
progress in a 6:1:1 classroom. We are simply not in a position to cull from this
testimony the evidence that R.E. permits us to consider and then determine
whether that testimony is credible and persuasive, particularly when the IHO
did not address those questions at all.
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For these reasons, we remand this case to the district court for further
proceedings consistent herewith. That court might, in its discretion, either
decide the merits of the IEP claim, or, perhaps more profitably, remand the
matter to state administrative officers for a complete reexamination in light of
our instructions in R.E. See T.L. v. New York City Dep’t of Educ., 938 F. Supp. 2d
417, 436 (E.D.N.Y. 2013) (“A court may remand a proceeding when it needs
further clarification or does not have sufficient guidance from the administrative
agencies.” (citing cases)). On remand, the district court is free to reexamine any
part of its prior analysis, and any other arguments that it did not need to address
in its initial decision.
CONCLUSION
We conclude that, in light of her contractual obligation to pay tuition to the
Center, E.M. has Article III standing to pursue her direct‐payment claim against
the Department. We further conclude, in light of intervening authority, that the
district court erred in affirming the SRO’s determination that the December 2008
IEP provided a FAPE. We therefore VACATE the judgment entered by the
district court and REMAND the cause for consideration of the merits or further
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proceedings by the state administrative officers in light of our decision in R.E. v.
New York City Department of Education, 694 F.3d 167 (2d Cir. 2012).
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