In the Matter of East Ramapo Central School District, Appellant,v.John B. King, Jr.,, et al., Respondents.BriefN.Y.February 8, 2017 Albany County Index No. 2185-13; App. Div. No. 519463 Court of Appeals of the State of New York EAST RAMAPO CENTRAL SCHOOL DISTRICT, Petitioner-Appellant, v. MARYELLEN ELIA, in her official capacity as the Commissioner of Educations, et al., Respondents-Respondents. BRIEF FOR RESPONDENTS BARBARA D. UNDERWOOD Solicitor General ANDREA OSER Deputy Solicitor General JEFFREY W. LANG Assistant Solicitor General of Counsel ERIC T. SCHNEIDERMAN Attorney General of the State of New York Attorney for Respondents The Capitol Albany, New York 12224 Telephone: (518) 776-2027 Dated: May 16, 2016 Reproduced on Recycled Paper To be argued by JEFFREY W. LANG Time requested: 15 minutes i TABLE OF CONTENTS PAGE PRELIMINARY STATEMENT .................................................................. 1 QUESTIONS PRESENTED....................................................................... 3 STATEMENT OF THE CASE ................................................................... 4 A. The IDEA .................................................................................. 4 B. Federal and State Oversight under the IDEA ........................ 6 C. Administrative Procedures Governing Disputes .................... 9 D. The Department Orders East Ramapo to Amend its Settlement Practices .............................................................. 12 E. East Ramapo Sues the Department in Federal Court ......... 17 F. East Ramapo Sues the Department in State Court ............. 19 G. Supreme Court Dismisses the Proceeding, and The Appellate Division Affirms .................................................... 22 ARGUMENT POINT I THE UNDERLYING PETITION WAS PROPERLY DISMISSED FOR FAILURE TO STATE A COGNIZABLE CLAIM UNDER C.P.L.R. ARTICLE 78 ............................................................... 24 A. East Ramapo fails to state a claim because it has no enforceable “right to resolve” parental complaints. ............. 26 B. Alternatively, and for similar reasons, East Ramapo lacks standing......................................................................... 37 ii Table of Authorities (cont’d) PAGE Argument, Point I, Subpoint B (cont'd) 1. East Ramapo is outside the zone of interests protected by the IDEA. ................................................. 38 2. East Ramapo lacks an in-fact injury. ........................... 43 C. The Department adequately preserved its standing defense, which is in any event nonwaivable. ........................ 45 POINT II ALTERNATIVELY, THE COURT SHOULD AFFIRM ON THE MERITS FOR THE REASONS STATED BY SUPREME COURT ........ 51 A. The Department reasonably concluded that East Ramapo failed to follow proper procedures. .......................... 51 B. The Department’s determination did not reflect an erroneous interpretation of federal law. ............................... 56 CONCLUSION ......................................................................................... 59 iii TABLE OF AUTHORITIES CASES PAGE Adirondack Health-Uihlein Living Center, Matter of v. Shah, 125 A.D.3d 1366 (4th Dep’t), lv. denied, 128 A.D.3d 1425 (2015) ................................................................... 39 AlohaCare v. Ito, 271 P.3d 621 (Haw. 2012) ............................................................... 42 Axelrod v.N.Y.S. Teachers’ Retirement Sys., 154 A.D.2d 827 (3d Dep’t 1989) ...................................................... 47 Battenkill Ass’n of Concerned Citizens, Matter of v. Town of Greenwich Planning Bd., 156 A.D.2d 863 (3d Dep’t 1989) ...................................................... 47 Beck-Nichols, Matter of v. Bianco, 20 N.Y.3d 540 (2013) ....................................................................... 51 Board of Educ. v. N.J. State Dep’t of Educ., 945 A.2d 125 (N.J. Super. Ct. App. Div. 2008) .............................. 34 Boatman, Matter of v. N.Y.S. Dept. of Educ., 72 A.D.3d 1467 (3d Dep’t 2010) ...................................................... 57 Cave v. East Meadow Union Free School Disctrict, 514 F.3d 240 (2d Cir. 2008) ............................................................... 4 City of New York v. State of New York, 86 N.Y.2d 286 (1995) ....................................................................... 46 County of Westchester v. New York, 286 F.3d 150 (2d Cir. 2002) ........................................................ 19,28 Cuomo v. Long Isl. Lighting Co., 71 N.Y.2d 349 (1988) ..................................................................... 48n iv TABLE OF AUTHORITIES (cont’d) CASES (cont’d) PAGE Delgado v. New York City Bd. of Educ., 272 A.D.2d 207 (1st Dep’t), lv. denied, 95 N.Y.2d 768 (2000), cert. denied, 532 U.S. 982 (2001) ............... 50 District of Columbia v. American University, 2 A.3d 175 (D.C. 2010) .................................................................... 43 District of Columbia v. Sierra Club, 670 A.2d 354 (D.C. 1996) ................................................................ 43 East Ramapo Central School District v. Delorenzo, No. 13-CV-1613 (CS), 2013 WL 5508392 (S.D.N.Y. Oct. 3, 2013) ....................................................... 2,18,27,44 Eaton Ass’n, Matter of v. Egan, 142 A.D.2d 330 (3d Dep’t 1988) ................................................. 46-47 EMC Mortgage Corp. v. Gass, 144 A.D.3d 1074 (3d Dep’t 2014) .................................................. 48n Field v. Allen, 9 A.D.2d 551 (3d Dep’t 1959) .......................................................... 48 Fleischer, Matter of v. New York State Liqour Auth., 103 A.D.3d 581 (1st Dep’t), lv. denied, 21 N.Y.3d 856 (2013) ....................................................................... 50 George v. Bloomberg, 2 A.D.3d 294 (1st Dep’t 2003), lv. denied, 2 N.Y.3d 707 (2004) .................................................................... 35,41 Gilman v. Abagnale, 235 A.D.2d 989 (3d Dep’t 1997) .................................................... 48n v TABLE OF AUTHORITIES (cont’d) CASES (cont’d) PAGE Gym Door Repairs, Inc. v. N.Y.C. Dep’t of Educ., 112 A.D.3d 1198 (3d Dep’t 2013) .................................................... 36 Hedgepeth v. N.C. Div. of Servs. for the Blind, 142 N.C. App. 338 N.C. Ct. App. 2001) .......................................... 43 Hernandez-Avalos v. I.N.S., 50 F.3d 842 (10th Cir.), cert. denied, 516 U.S. 826 (1995) ......................................................................... 43 Home Care Ass’n of N.Y.S., Matter of v. Bane, 218 A.D.3d 106 (3d Dep’t 1995), lv. denied, 87 N.Y.2d 808 (1996) ............................................................. 40-41,42 Honig v. Doe, 484 U.S. 305 (1988) ......................................................................... 39 Independent School District No. 281 v. Minnesota Dep’t of Educ., No. A06-1617, 2007 WL 2774337 (Minn. Ct. App. Sept. 25, 2007) ................................................................................. 34 Jackson v. N.Y.S. Urban Development Corp., 67 N.Y.2D 400 (1986) ...................................................................... 35 Kruger v. State Farm Mutual Auto. Ins. Co., 79 A.D.3d 1519 (3d Dep’t 2010) .................................................... 48n Lake Washington School District No. 414 v. Office of Superintendent of Public Instruction, 634 F.3d 1065 (9th Cir. 2011) .................................................... 29,41 Lawrence Township Bd. of Educ. v. New Jersey, 417 F.3d 368 (3d Cir. 2005) ............................................................. 30 vi TABLE OF AUTHORITIES (cont’d) CASES (cont’d) PAGE N.Y.C. Dep’t Envtl. Prot. v. N.Y.C. Civ. Serv. Comm’n, 78 N.Y.2d 318 (1991) ....................................................................... 36 N.Y.S. Assoc. of Nurse Anesthetists v. Novello, 2 N.Y.3d 207 (2004) ......................................................................... 45 N.Y.S. Inspection, Sec. & Law Enforcement Empls., Matter of v. Cuomo, 64 N.Y.2d 233 (1984) ....................................................................... 46 Pell, Matter of v. Bd. of Educ. of Union Free School District No. 1 of Towns of Scarsdale and Mamaroneck, 34 N.Y.2d 222 (1974) .................................................................... 4,51 People ex rel. Cuomo v. First American Corp., 18 N.Y.3d 173 (2011) ....................................................................... 32 Plainview-Old Bethpage Congress of Teachers, Matter of v. N.Y.S. Health Ins. Plan, 1223 A.D.3d 1140 (3d Dep’t 2015) ................................................ 48n Rainbow Hospitality Mgt. v. Mesch Engr., 270 A.D.2d 906 (4th Dep’t 200) ....................................................... 49 St. Margaret’s Center, Matter of v. Novello, 23 A.D.3d 817 (3d Dep’t 2005) .............................................. 40,41,42 Save the Pine Bush, Inc., Matter of v. Common Council of the City of Albany, 13 N.Y.3d 297 (2009) ....................................................................... 37 School Community of Burlington v. Dep’t of Educ., 471 U.S. 359 (1985) ......................................................................... 57 vii TABLE OF AUTHORITIES (cont’d) CASES (cont’d) PAGE Sega v. State, 60 N.Y.2d 183 (1983) ....................................................................... 50 Schwartz v. Morgenthau, 7 N.Y.3d 427 (2006) ......................................................................... 38 Society of Plastics Indus., Inc. v. County of Suffolk, 77 N.Y.2d 761 (1991) ........................................................... 37,47,48n Sterritt v. Heins Equip. Co., 114 A.D.2d 616 (3d Dep’t 1985) ...................................................... 48 Traverse Bay Area Intermediate School District v. Michigan Dep’t of Education, 615 F.3d 622 (6th Cir. 2010) ........................................................... 28 Truty v. Federal Bakers Supply Corp., 217 A.D.2d 951 (4th Dep’t 1995) ..................................................... 49 Wells Fargo Bank Minnesota, Natl. Ass’n v. Mastropaolo, 42 A.D.3d 239 (2d Dep’t 2007) ...................................................... 48n FEDERAL STATUTES 5 U.S.C. §§ 701-706 ................................................................................... 32,45 20 U.S.C. § 1400(c) ........................................................................................... 38 § 1400(d) ........................................................................................... 38 § 1412(a)(5)(A) ................................................................................... 5 § 1412(a)(13) ...................................................................................... 9 § 1415(a) ........................................................................................ 7,39 viii TABLE OF AUTHORITIES (cont’d) FEDERAL STATUTES (cont’d) PAGE 20 U.S.C. §§ 1400-1487 ...................................................................................... 1 § 1415(b)(6) ........................................................................................ 9 § 1415(b)(7)(ii)(III) ........................................................................... 10 § 1415(b)(7)(ii)(IV) ........................................................................... 10 § 1415(e)(2)(f) .............................................................................. 10,26 § 1415(i) ............................................................................................ 10 § 1415(i)(2)(A) .................................................................................. 11 § 1416(a) ............................................................................................. 8 § 1416(a)(1)(A) .................................................................... 7,26,37,56 § 1416(a)(2) ........................................................................................ 7 § 1416(a)(3) ...................................................................................... 30 § 1416(b) ............................................................................................. 8 § 1416(b)(2) ........................................................................................ 8 § 1416(d) ............................................................................................. 8 § 1416(e) ............................................................................................. 8 § 1416(e)(1) ...................................................................................... 31 § 1416(e)(2) ...................................................................................... 31 42 U.S.C § 1983 ............................................................................................... 18 FEDERAL RULES AND REGULATIONS 34 C.F.R. § 76.401(d)(5) ...................................................................... 9,30,32,44 § 300.116(a) ........................................................................................ 5 § 300.116(b)(2) ................................................................................... 5 § 300.116(c) ................................................................................... 5,54 § 300.151 ..................................................................................... 11,33 § 300.222(a) ........................................................................................ 9 § 300.324(a)(2)(ii) ............................................................................... 6 § 300.510(a)(1) ................................................................................. 10 § 300.510(d) ................................................................................. 10,56 ix TABLE OF AUTHORITIES (cont’d) FEDERAL RULES AND REGS. (cont’d) PAGE 34 C.F.R. § 300.600(e) ........................................................................................ 7 § 300.602 ....................................................................................... 7,27 § 300.602(b) ........................................................................................ 8 § 300.603(b) ........................................................................................ 8 § 300.660 .......................................................................................... 35 71 Fed. Reg. 46703 (Aug. 14, 2006) ......................................................... 56 STATE STATUTES C.P.L.R. article 78 .................................................................................. passim 3018(b) ........................................................................................ 49,50 3211(a) ...................................................................................... 48n,49 3211(a)(2) ......................................................................................... 46 3211(a)(3) ......................................................................................... 48 3211(a)(4) .................................................................................. 21,49n 3211(a)(7) .................................................................................... 21,48 3211(e) ............................................................................................ 48n Education Law §§ 4401-4410b .................................................................................... 4 § 4404(1)(a) ...................................................................................... 10 § 4404(1)(b) ...................................................................................... 10 § 4404(2) ........................................................................................... 11 § 4404(3)(a) ...................................................................................... 11 x TABLE OF AUTHORITIES (cont’d) STATE RULES AND REGULATIONS PAGE 8 N.Y.C.R.R. § 154-2.2(f) ....................................................................................... 14 § 200 ................................................................................................ 4-5 § 200.4(d)(ii) .................................................................................. 5,54 § 200.4(d)(3)(iii) ................................................................................. 6 § 200.5(i) ........................................................................................... 10 § 200.5(j) ........................................................................................... 10 § 200.5(j)(2)(i) ................................................................................... 10 § 200.5(k) .......................................................................................... 11 § 200.5(k)(3) ..................................................................................... 11 § 200.5(l) ...................................................................................... 11,34 § 200.5(l)(2) ...................................................................................... 11 § 200.5(l)(2)(e) .................................................................................. 11 § 200.6(j) ................................................................................... 6,12,13 MISCELLANEOUS http://www2.ed.gov/policy/speced/guid/idea/letters/revpolicy/index. html. 9n http://www.p12.nysed.gov/ docs/east-ramapo-fiscal-monitor- presentation.pdf. ........................................................................... 12n H.R. Rep. No. 105-95 (1997), reprinted in 1997 U.S.C.C.A.N. 78 .......... 38 Siegel, New York Practice § 136 (5th ed.) ............................................... 47 PRELIMINARY STATEMENT The Individuals with Disabilities Education Act, 20 U.S.C. §§ 1400–1487 (the “IDEA”), entitles children with disabilities to a free appropriate public education in the least restrictive environment suitable for each child. Under the statute, the federal government provides money to state educational agencies provided that they follow the IDEA’s procedures and meet targets regarding the education of students with disabilities. State educational agencies are in turn charged with monitoring the implementation of the IDEA by local educational agencies. This appeal concerns whether a local educational agency may use an article 78 proceeding against a state educational agency to assert violations of its purported “right and discretion” under the IDEA to settle complaints by parents of students with disabilities concerning the placement of their children. Petitioner East Ramapo Central School District (“East Ramapo”), a local educational agency, has entered into multiple settlements acceding to parents’ requests for placements that are more restrictive than warranted by the respective students’ needs. It seeks to assert a purported settlement right that would allow it to 2 continue this practice. Congress did not intend to create an enforceable settlement right in the IDEA, however. Instead, Congress established federal administrative oversight of state enforcement of the IDEA’s mandate to educate students with disabilities in the least restrictive environment suitable for their needs. East Ramapo first sought to assert violations of its purported settlement right in an action in federal district court, but the federal court dismissed the complaint on the ground that East Ramapo has no enforceable “right to resolve” a parental complaint under the IDEA. East Ramapo Central School District v. DeLorenzo, No. 13-CV-1613 (CS), 2013 WL 5508392 (S.D.N.Y. Oct. 3, 2013). In the underlying proceeding, East Ramapo seeks to repackage its federal complaint as an article 78 petition. Supreme Court, Albany County (Melkonian, J.), dismissed the proceeding on the merits. The Appellate Division, Third Department, unanimously affirmed on the basis that the petition failed to state a claim. This Court can affirm on either ground. East Ramapo’s petition was properly dismissed as a threshold matter because East Ramapo lacks a cognizable claim under article 78. This is so for either of two reasons. First, as the Appellate Division 3 correctly held, East Ramapo fails to state a claim, because its case is premised on violations of its purported federal right to settle parental complaints, but the relevant federal statute—the IDEA—does not give it any such enforceable right. Second, East Ramapo lacks standing to assert its claim, because it has no “right to settle” parental complaints, let alone a right within the zone of interests protected by the IDEA, which is concerned with the rights of parents and their children with disabilities rather than school districts. Indeed, East Ramapo lacks any in-fact injury because it was not in any way aggrieved by the Department’s determination. And while the Department did not specifically assert the defense of standing below, the defense is not waivable. Alternatively, the Court should affirm on the merits for the reasons stated by Supreme Court. QUESTIONS PRESENTED 1. Whether the Appellate Division properly dismissed the underlying article 78 proceeding for failure to state a cognizable claim under C.P.L.R. article 78. 4 2. Alternatively, whether the Appellate Division’s decision should be affirmed on the merits because the determination at issue was rationally based on the record and a reasonable construction of the IDEA’s requirements. STATEMENT OF THE CASE A. The IDEA “The IDEA’s central mandate is to provide students with disabilities with a ‘free appropriate public education’ in the least restrictive environment suitable for their needs.” Cave v. East Meadow Union Free School District, 514 F.3d 240, 245 (2d Cir. 2008). In order for state and local educational agencies to receive financial assistance under the IDEA, they must establish policies and procedures ensuring that children with disabilities are educated to the maximum extent appropriate in the least restrictive environment. An environment is the least restrictive if it is “with children who are not disabled, and special classes, separate schooling, or other removal of children with disabilities from the regular educational environment occurs only when the nature or severity of the disability of a child is such that education 5 in regular classes with the use of supplementary aids and services cannot be achieved satisfactorily.” 20 U.S.C. § 1412(a)(5)(A). Like other states, New York has passed laws and regulations to implement the IDEA. See N. Y. Educ. Law §§ 4401–4410b; 8 N.Y. Comp. Codes R. & Regs. (“N.Y.C.R.R.”) Part 200. Under the IDEA, and the state laws and regulations implementing it, any special programs or out-of-district placements that a student receives must be based on an individualized education program (“IEP”), which is prepared by “a group of persons, including the parents, and other persons knowledgeable about the child, the meaning of the evaluation data, and the placement options” and determined at least annually. 34 C.F.R. § 300.116(a), (b)(2); see also N.Y. Educ. Law § 4402(1)(b)(a). In New York, the IEP team is called the Committee on Special Education (“CSE”), and it is composed of the student’s parents, regular or special education teacher, a school psychologist, a school physician, a representative of the school district, and an interpreter of evaluation tests. Id. Unless the student’s IEP requires otherwise, the student must be educated in the school that he or she would attend if not disabled. 6 34 C.F.R. § 300.116(c); 8 N.Y.C.R.R. § 200.4(d)(ii). School districts nonetheless may place students in approved private schools where the nature and severity of the student’s disability is such that appropriate public facilities are not available. 8 N.Y.C.R.R. § 200.6(j). Although school districts may obtain State reimbursement for such placements, their applications for reimbursement must document their efforts to place the student in a public facility and to enable the student to benefit from instruction in less restrictive settings using support services, supplementary aids, and special education services, as well as the student’s lack of progress in these settings. Id. Additionally, where the student has limited English proficiency, the CSE must “consider the language needs of the child as those needs relate to the child’s IEP.” 34 C.F.R. § 300.324(a)(2)(ii); 8 N.Y.C.R.R. § 200.4(d)(3)(iii). B. Federal and State Oversight under the IDEA The IDEA establishes a two-tiered system of oversight in which the federal government monitors implementation of the statute by state educational agencies, and those agencies in turn monitor compliance by local educational agencies within their borders. In the first instance, local educational agencies—generally school districts—that receive 7 assistance under the IDEA are responsible for providing students with disabilities within their districts with a free appropriate public education in the least restrictive environment. 20 U.S.C. § 1415(a). The IDEA requires that state educational agencies monitor the implementation of the statute by school districts, report annually on their progress, and enforce compliance where necessary. 20 U.S.C. § 1416(a)(1)(A); 34 C.F.R. § 300.602. The primary focus of such monitoring should be on “improving educational results and functional outcomes for all children with disabilities.” 20 U.S.C. § 1416(a)(2). To meet its oversight obligations, the Department conducts periodic monitoring reviews of school districts (Petitioner’s Appendix [“A”] 339). Among other things, the Department examines the documentation maintained by school districts with respect to students with disabilities placed in out-of-district settings to ensure that the districts have properly evaluated the propriety of such placements (A. 336-37). If the Department finds that a school district is not following the IDEA’s procedures, it must ensure that the noncompliance is corrected as soon as possible, and no more than a year from the date the Department identified the noncompliance. 34 C.F.R. § 300.600(e). 8 The U.S. Secretary of Education in turn oversees State implementation of the IDEA, including through “oversight of the exercise of general supervision by the States” over local educational agencies. 20 U.S.C. § 1416(a). To facilitate federal oversight, state educational agencies must file a performance plan with the Secretary each year. 20 U.S.C. § 1416(b); 34 C.F.R. § 300.602(b). The plan reports whether the state has met its own established targets in areas of priority identified by the Secretary. 20 U.S.C. § 1416(b)(2). If a state has not met these targets, the Secretary may find that the state “needs assistance,” “needs intervention,” or “needs substantial intervention,” and may ultimately withhold IDEA payments to the state. 20 U.S.C. §§ 1416(d), (e); 34 C.F.R. § 300.603(b). In response to New York’s performance plan for fiscal year 2011, the Secretary determined that New York “needs assistance” in implementing the IDEA because, among other reasons, it failed to reach the target of placing fewer than 6% of its students with disabilities in out-of-district facilities (A. 338). Likewise, if a state educational agency finds that a school district is persistently noncompliant, it must reduce or withhold IDEA payments until it is satisfied that the school district has remedied the 9 deficiency. 34 C.F.R. § 300.222(a). Before a state may withhold funds from a school district, however, it must provide the district with notice and the opportunity for a hearing. 20 U.S.C. § 1412(a)(13); 34 C.F.R. § 76.401(d)(5). And should the state educational agency thereafter decide to withhold IDEA funds, the school district may appeal to the U.S. Secretary of Education. 34 C.F.R. § 76.401(d)(5). Even apart from a formal appeal, the Secretary may take corrective action against a state educational agency in response to complaints by interested parties, including school districts. And the Secretary’s Office of Special Education Programs issues guidance concerning its interpretation of the IDEA and the regulations that implement the IDEA in response to written inquiries.1 C. Administrative Procedures Governing Disputes The IDEA provides two types of dispute-resolution procedures. First, the statute gives parents of children with disabilities the right to contest any matter “relating to the identification, evaluation or educational placement of the child, or the provision of a free appropriate public education to such child.” 20 U.S.C. § 1415(b)(6). To exercise this 1 See http://www2.ed.gov/policy/speced/guid/idea/letters/revpolicy/index .html. 10 right, a parent must file a due process complaint with the school district describing the nature of the parent’s objection and offer a resolution of the problem. 20 U.S.C. §§ 1415(b)(7)(ii)(III), (IV); Educ. Law § 4404(1)(a); 8 N.Y.C.R.R. § 200.5(i). In response to a due process complaint, the school district “must convene a meeting with the parent and relevant members of the IEP Team who have specific knowledge of the facts identified in the due process complaint.” 34 C.F.R. § 300.510(a)(1); see also Educ. Law § 4404(1)(a); 8 N.Y.C.R.R. § 200.5(j)(2)(i). If the dispute is resolved at the meeting, the parties must execute a settlement agreement, which the statute makes enforceable under state and federal law. 20 U.S.C. § 1415(e)(2)(F); Educ. Law § 4404(1)(b); 34 C.F.R. 300.510(d). If the dispute is not resolved at the meeting, the parents may proceed to an impartial hearing. Educ. Law § 4404(1)(a); 8 N.Y.C.R.R. § 200.5(j). Either party aggrieved by the decision of the hearing officer—the parents or the school district—may appeal the decision of the hearing officer to a state review officer with the Department. 20 U.S.C. § 1415(i); Educ. Law § 4404(2); 8 N.Y.C.R.R. § 200.5(k). Either party aggrieved by the state review officer’s decision may seek judicial review 11 in state or federal court. Educ. Law § 4404(3)(a); 8 N.Y.C.R.R. § 200.5(k)(3) (aggrieved party may bring C.P.L.R. article 4 special proceeding); 20 U.S.C. § 1415(i)(2)(A) (aggrieved party may bring civil action in federal court). Second, the IDEA allows any person or organization to file a complaint with a state educational agency concerning the education of students with disabilities. See 34 C.F.R. § 300.151 (former § 300.660); see also 8 N.Y.C.R.R. § 200.5(l) (administrative complaint must allege that “the school district or the State Education Department has violated a Federal or State law or regulation relating to the education of students with disabilities”). Upon review of the relevant information, the Department must issue a final written decision. 8 N.Y.C.R.R. § 200.5(l)(2). And where a state administrative complaint involves the rights of an individual student, the complainant or the school district may request an impartial hearing to consider the issue anew under the procedures provided for due process complaints. 8 N.Y.C.R.R. § 200.5(l)(2)(e). 12 D. The Department Orders East Ramapo to Amend its Settlement Practices From April 2010 to February 2012, the Department’s Office of Special Education conducted multiple on-site monitoring reviews of the East Ramapo Central School District.2 These reviews revealed that East Ramapo had failed to comply with 8 N.Y.C.R.R. § 200.6(j) by placing multiple students at special education private schools without documenting its efforts to meet the needs of these students in its public schools (A. 339, 390-400, 408-09; 341-42). In May 2012, the Department notified East Ramapo of its findings in detail and, among other actions, required East Ramapo to submit written applications for State reimbursement for three identified private schools (A. 411-13). In July 2012, the Department’s Office of Special Education conducted a follow-up monitoring review focusing on two areas. First, Department staff examined whether East Ramapo had resolved its earlier noncompliance by properly documenting its student placements at special education private schools (A. 422). The Department concluded 2 East Ramapo has separately been the subject of a recent official inquiry into a broad range of problems that have afflicted it, the details of which can be found at http://www.p12.nysed.gov/ docs/east-ramapo-fiscal-monitor- presentation.pdf. 13 that East Ramapo remained noncompliant with 8 N.Y.C.R.R. § 200.6(j) by continuing to place students with disabilities in select special education private schools without adequate documentation (A. 423). East Ramapo does not seek to challenge this finding in this proceeding. Second, Department staff reviewed the documentation of 21 meetings conducted by East Ramapo in advance of the 2012-13 school year with parents of students with disabilities who had objected to the CSE’s recommended placements for their children and whose objections were resolved by settlement (A. 423). The Department found that all of these “resolution meetings” were conducted by a single representative of the school district (A. 424).3 The Department also found that, despite the CSE’s recommendation in these cases for public school placements,4 East Ramapo had settled virtually all of them by offering out-of-district placements, either at a special education private school (14 students) or at a single out-of-district public school, the Kiryas Joel Union Free 3 Although not relevant to this appeal, the single District representative may not even have been a member of the CSE which made the original placement recommendations. (See A. 469.) East Ramapo maintains otherwise (A. 543-44). 4 The public school facilities recommended by the CSE were a District special class (15 students); a Board of Cooperative Educational Services (BOCES) special class (5 students); and a bilingual special class in the Kiryas Joel Union Free School District (1 student) (A. 423). 14 School District (6 students) (A. 423). And in 14 of the 21 cases, the purported justification for the out-of-district placement was the student’s need for a Yiddish bilingual special education program (A. 423), even though the IEPs for the students in 12 of those 14 cases suggested no such need (A. 424). On the contrary, the IEPs of 11 of the subject students specifically stated that the students were not “English Language Learners”5 and thus did not require bilingual special education services (A. 424). The Department thus found that East Ramapo had misused the IDEA’s dispute resolution procedures by circumventing the role of the CSE in student placements (A. 424-26). Although the CSE must recommend a student placement based on the student’s IEP, the Department found that East Ramapo was routinely settling parental disputes by overriding the CSE’s placement recommendation. Specifically, the settlements were entered into by a single representative of the school district, without the benefit of the full CSE panel of experts familiar with the students’ needs. And many of the 5 An “English Language Learner” is a student for whom English is a second language and who speaks or understands little or no English. 8 N.Y.C.R.R. § 154-2.2(f). 15 placements were for out-of-district schools based on a purported need for Yiddish bilingual special education services that was not supported by the students’ IEPs. Thus, while the Department acknowledged that East Ramapo “has the authority to enter into settlement agreements with parents on matters in dispute,” East Ramapo’s practices, it found, “demonstrate a clear intent and pattern to circumvent the IDEA and remove the IEP decision-making process from the CSE” (A. 424). Thus, in these cases, East Ramapo acceded to the parents’ requests for placements that were more restrictive than warranted by the respective students’ IEPs. Assistant Commissioner James P. DeLorenzo, head of the Department’s Office of Special Education, notified East Ramapo of these findings by letter dated December 12, 2012 (A 422-26). The Department did not, however, require East Ramapo to take any corrective action that would have abrogated any settlement agreements already finalized. Nor did the Department withhold any monies from East Ramapo, or otherwise penalize it or prohibit it from continuing to seek settlements of well-founded parental due process complaints on an individualized basis. Instead, the Department simply directed East 16 Ramapo prospectively to cease its practice of allowing a sole district representative to override the placement recommendation of the full CSE panel; to follow the dispute-resolution procedures established by the IDEA; and in settling parental complaints, to adhere to the IDEA’s mandate to place students in the least restrictive environment appropriate for the child (A. 425). As ancillary administrative remedies, the Department also ordered East Ramapo (1) to continue submitting paper applications to obtain the Department’s approval of State reimbursement for any student placements at three identified private schools, a directive the Department had originally issued back in August 2010 (A. 390-96); (2) to review the IEPs of all students placed out-of-district based on their purported need for Yiddish bilingual special education programs and “submit a place and timeline for developing in-district programs to 17 meet the needs of such students;”6 (3) to post a two-page notice of the Department’s findings on its website (A. 425). E. East Ramapo Sues the Department in Federal Court On March 11, 2013, East Ramapo sought to challenge the Department’s December 2012 determination in a federal action in the U.S. District Court for the Southern District of New York. Its complaint against the Department and certain Department officials in their individual capacities alleged that the Department’s December 2012 determination was based on an erroneous interpretation of the IDEA. East Ramapo sought a declaratory judgment of its “rights and obligations” under the IDEA; specifically it sought a declaration that “the IDEA provides the District with broad discretion to fashion mutually agreeable settlements to parental challenges,” including the authority to settle disputes by agreeing to placements other than those recommended by the CSE when it is in East Ramapo’s financial 6 East Ramapo asserts (Br. at 10) that the Department “ordered the District to refer all disputes back to the CSE.” That is incorrect. The Department asked the East Ramapo’s CSE to review the IEPs of all students placed in out-of-district schools based on a purported need for Yiddish bilingual special education programs so that East Ramapo could submit a plan to the Department for developing such programs in-district (A. 425). 18 interests to do so, even if these placements do not represent the least restrictive environment suitable for the student. East Ramapo asserted that the IDEA was intended to benefit local educational agencies like itself and thus “unambiguously conferred” on it a judicially enforceable right to settle parental due process complaints in order to avoid the expense of litigation. East Ramapo Central School District v. DeLorenzo, No. 13-CV-1613 (CS), 2013 WL 5508392 at *6 (S.D.N.Y. Oct. 3, 2013). On the Department’s motion, the court dismissed East Ramapo’s complaint. Following uniform federal appellate precedent, the court held that the IDEA does not create rights or entitlements enforceable by a local educational agency in a private action against a state educational agency, either under the IDEA directly or under 42 U.S.C. § 1983; in particular, the court concluded, the statute does not confer upon East Ramapo an enforceable “right to resolve” a parental due process complaint by settlement. Id. at *7-8. In declining East Ramapo’s invitation to imply a private right of action in the absence of an express right, the court noted that the IDEA “expressly delegated regulatory and enforcement authority to the Secretary of Education.” Id. at *7. Such a delegation, the court concluded, is “inconsistent with implying a 19 private right of action because private litigation tends to transfer regulatory interpretation and discretion from the agency to the courts.” Id. (quoting County of Westchester v. New York, 286 F.3d 150, 153 [2d Cir. 2002]). The court found that the “same logic” applied equally here and precluded East Ramapo’s claims. The court also rejected East Ramapo’s argument that the Department’s directive to amend its dispute-resolution procedures going forward inhibited its ability to settle parental disputes. As the court observed, this directive “does not prevent the District from complying with the IDEA in general or settling disputes in particular.” Id. at 8. Accordingly, the court dismissed the complaint. East Ramapo did not appeal. F. East Ramapo Sues the Department in State Court In the meantime, and while its federal case was still pending, East Ramapo repackaged its case as the underlying C.P.L.R. article 78 proceeding to review the same Department determination at issue in the federal case (A. 165-90). The underlying article 78 proceeding is based on the same alleged injury as its federal counterpart: that the Department’s directive to amend East Ramapo’s settlement practices 20 reflected an erroneous interpretation of the IDEA and violated the school district’s purported federal right to resolve parental due process claims as it sees fit. East Ramapo’s petition enumerates seven counts. Counts one through four contend that the Department’s findings concerning the settlement procedures followed by East Ramapo were “not based on substantial evidence” (A. 180-83). For purposes of these counts, East Ramapo alleges that the Department improperly found widespread improprieties and intentional misconduct on the part of East Ramapo on the basis of the documentation of just 21 resolution meetings, though it does not suggest the Department sanctioned it in any way. Counts five through seven allege that several “legal determinations” supposedly made by the Department are affected by error of law because they conflict with the IDEA and implementing state laws and regulations (A. 184-87). Specifically, East Ramapo alleges that the Department’s legal conclusions infringe upon its “right and discretion to settle parental challenges” with a placement different from that of the IEP, even a more restrictive one and even when East Ramapo does not concede that the CSE’s recommended placement was inappropriate 21 (A. 185-86). East Ramapo seeks an order annulling the Department’s determination and enjoining it from ordering East Ramapo to amend its settlement procedures (A. 188-90). The Department initially moved to dismiss on timeliness grounds or, alternatively, to stay the proceeding under C.P.L.R. 3211(a)(4) pending a decision in the federal case because both cases were based on the same facts and raised identical issues (A. 246-60). Supreme Court denied the motion (A.139-44), and the Department thereafter answered the petition (A. 314-18). Its answer raises as an objection under C.P.L.R. 3211(a)(7) that the petition fails to state a cause of action (A. 317). Before Supreme Court rendered its decision but after the briefing was completed in the state case, the federal court dismissed East Ramapo’s parallel federal action, as described above. The Department provided Supreme Court with a copy of the federal court’s decision (A. 579). 22 G. Supreme Court Dismisses the Proceeding, and The Appellate Division Affirms Supreme Court, Albany County (Melkonian, J.), dismissed East Ramapo’s petition on the merits, finding that East Ramapo failed to meet its burden of showing that the Department acted arbitrarily and capriciously or contrary to law (A. 35-48). The court noted that the petition did not present a question of substantial evidence because the determination at issue did not involve the formal receipt of evidence (A. 42). Otherwise, the Department’s determination was reasonably based “on several on-site monitoring reviews of petitioner’s special education placements” and none of the Department’s directives prevented East Ramapo from settling parental disputes, provided that East Ramapo ceased its practice of “approving unnecessarily restrictive placements” by allowing a single district representative to override the CSE’s recommendation (A. 46). East Ramapo appealed to the Appellate Division, Third Department (A. 582). In urging that court to affirm, the Department defended the rationality of its December 2012 determination but also argued that, as a threshold matter, East Ramapo failed to state a cause of action. Citing the recent decision in East Ramapo’s federal case 23 against the Department, the Department argued that because the IDEA does not give East Ramapo an enforceable “right to resolve” a parental complaint, East Ramapo failed to state a claim cognizable in an article 78 proceeding. The Department also cited a line of Appellate Division cases holding that parties lack standing under article 78 to assert violations of purported federal statutory rights where the relevant federal law does not recognize any such enforceable rights. The Appellate Division unanimously affirmed (A. 52-56). Noting that East Ramapo had brought an article 78 proceeding, the court found the “dispositive issue” to be “whether the IDEA grants petitioner a private right of action to challenge the State Education Department’s determination” concerning East Ramapo’s dispute-resolution practices (A. 53). Recognizing that the IDEA did not grant an express right of action allowing school districts to challenge regulatory decisions by state educational agencies, the court went on to consider whether such a right should be implied. Following the reasoning of federal courts, the court found that the IDEA’s delegation of regulatory and enforcement powers to the U.S. Secretary of Education and state educational agencies—but not to school districts—suggests that Congress 24 specifically intended to deny school districts a private right of action to contest a state’s enforcement of the IDEA. Accordingly, the court concluded that “it would be inconsistent for Congress to implicitly create this right of action, as doing so would divest the Secretary of Education and the states of their regulatory and enforcement authority and would transfer that power to the Judiciary” (A. 55-56). On this basis, the Appellate Division affirmed dismissal of the proceeding. The court thus did not reach the Department’s alternative argument for affirmance on the merits. This Court granted East Ramapo’s motion for leave to appeal (A. 82). ARGUMENT POINT I THE UNDERLYING PETITION WAS PROPERLY DISMISSED FOR FAILURE TO STATE A COGNIZABLE CLAIM UNDER C.P.L.R. ARTICLE 78 The Court should affirm on the basis that the underlying petition fails to state a cognizable claim under C.P.L.R. article 78. The fundamental premise of East Ramapo’s petition is its claim that the Department interfered with its “right and discretion” under the IDEA to settle parental due process complaints as it deems appropriate. As 25 demonstrated below, the IDEA does not give school districts an enforceable “right to resolve” a parental complaint. Indeed, federal courts have unanimously held that implying a private right of action that would allow school districts to contest the regulatory and enforcement actions of state educational agencies concerning them would thwart congressional intent. The IDEA instead contemplates federal administrative oversight as the forum to resolve such disputes in the first instance. And absent an enforceable right to resolve a parental complaint as it sees fit, East Ramapo cannot state a claim under article 78. For similar reasons, East Ramapo lacks standing to bring this proceeding. Faced with similar attempts by article 78 petitioners to assert violations of purported federal statutory rights, the departments of the Appellate Division have typically reasoned that, where the relevant federal statute does not itself provide a private right of action, petitioners lack standing to bring federal statutory claims indirectly by way of article 78. East Ramapo’s lack of a cognizable claim thus may be analyzed as either a failure to state a claim or a lack of standing; either 26 way, it was properly dismissed as a threshold matter before reaching the merits. A. East Ramapo fails to state a claim because it has no enforceable “right to resolve” parental complaints. East Ramapo fails to state a claim because the IDEA does not recognize a “right to resolve” a parental due process complaint enforceable by the judiciary. On the contrary, the statute entrusts state educational agencies with regulatory authority over local implementation. See 20 U.S.C. § 1416(a)(1)(A); 34 C.F.R. § 300.602. As part of their monitoring responsibilities, state educational agencies may review whether school districts are following proper settlement procedures and exercising their discretion to settle parental due process complaints consistent with IDEA principles. To be sure, the statute makes any settlement agreements reached with parents enforceable under state and federal law, see 20 U.S.C. § 1415(e)(2)(F), and guidance from the U.S. Secretary of Education notes that “mediation and settlement agreements are ways to resolve disputes and avoid the time and costs associated with protracted litigation” (A. 205). But a policy that recognizes the benefits of settlements does not translate into a 27 right to file a lawsuit whenever a school district disagrees with a state’s assessment of its settlement practices. Accordingly, the court in East Ramapo’s parallel federal action correctly found that the IDEA does not recognize a judicially enforceable “right to resolve” parental complaints. East Ramapo Central School District, 2013 WL 5508392 at *7-8. East Ramapo concedes (Br. at 18) that the IDEA was intended to benefit children with disabilities and their parents rather than school districts and, as a consequence, does not give East Ramapo a private right of action. Its concession is apt given that every federal circuit court to have considered the issue has concluded that school districts do not have a private right of action under the IDEA to challenge the regulatory and enforcement actions of state educational agencies. But East Ramapo ignores that the rationale for denying a private right of action applies equally here. Just as implying a private right of action would thwart congressional intent to vest primary regulatory and enforcement authority in state educational agencies and the U.S. Secretary of Education, and instead transfer this authority to the judiciary, so too would permitting this article 78 proceeding to go 28 forward. The Appellate Division therefore properly held this proceeding to be precluded by the IDEA. As the Second Circuit has explained upon dismissing a challenge to the Department’s enforcement of the IDEA, the U.S. Secretary of Education “is primarily responsible for the interpretation and implementation of the IDEA and has been granted regulatory and enforcement powers.” County of Westchester, 286 F.3d at 153. Implying a private right of action against a state would be inconsistent with the broad agency powers conferred by the IDEA, the court held, “because private litigation tends to transfer regulatory interpretation and discretion from the agency to the courts.” Id. at 153. The Sixth Circuit likewise dismissed a lawsuit where school districts had claimed to be aggrieved by a state’s failure to implement proper due process procedures. Traverse Bay Area Intermediate School District v. Michigan Dep’t of Education, 615 F.3d 622, 630 (6th Cir. 2010). The court declined to imply a right of action to allow the school districts there to enforce their interpretation of the IDEA against the state agencies involved, noting that the IDEA’s failure to provide a right of action apart from disputes over the treatment of a particular 29 child with disabilities suggested that Congress did not want judicial review outside of this context. Id. at 629. The court also reasoned that because Congress delegated regulatory authority to the U.S. Secretary of Education, “it would be problematic to allow local educational agencies to maintain lawsuits against state educational agencies for their alleged non-compliance with the IDEA’s procedural safeguards.” 615 F.3d at 630. The Ninth Circuit similarly concluded that the IDEA did not give a school district the right to sue a state educational agency over the state’s conduct of a particular due process hearing. Lake Washington School District No. 414 v. Office of Superintendent of Public Instruction, 634 F.3d 1065, 1069 (9th Cir. 2011). The court found that the school district “lack[ed] statutory standing” to bring a lawsuit to enforce against the state educational agency procedural protections that were intended to safeguard the rights of children with disabilities and their parents. Id. at 1069. The court declined to imply a private right of action in favor of school districts because the IDEA “creates no private right of action for school boards or other local educational agencies apart from contesting issues raised in the complaint filed by the parents 30 on behalf of their child.” Id. at 1068; see also Lawrence Township Bd. of Educ. v. New Jersey, 417 F.3d 368, 372 (3d Cir. 2005) (no right of action on behalf of school districts). Allowing school districts to obtain state court review of regulatory and enforcement determinations by state educational agencies would similarly thwart congressional intent. The IDEA entrusts state educational agencies and, ultimately, the U.S. Secretary of Education with primary responsibility to interpret and enforce its provisions. The Secretary is therefore the appropriate arbiter in the first instance of disputes between a school district and a state educational agency. This principle is embodied in the federal regulation that allows a school district to appeal a state educational agency’s decision to reduce or withhold IDEA funds to the Secretary. See 34 C.F.R. § 76.401(d)(5). And the Secretary generally enjoys broad enforcement authority over state educational agencies. See 20 U.S.C. §§ 1416(a)(3); (e)(1); (e)(2). These provisions confirm that Congress wanted federal administrative oversight to be the principal means for ensuring that states were properly enforcing the statute, not lawsuits that would short-circuit such federal oversight. 31 If East Ramapo believes that it has been aggrieved by an enforcement action inconsistent with the IDEA, its remedy therefore lies with the U.S. Secretary of Education. East Ramapo’s argument (Br. at 22-24) that judicial review is required to check Department abuse ignores the paramount role of the Secretary in enforcing compliance with the IDEA by state and local agencies.7 By the same token, if state courts were to permit judicial enforcement of a purported federal right to settle parental due process complaints, they would create an “irreconcilable conflict” between state law and the IDEA’s enforcement scheme. Any such judicial enforcement would thus be void under the Supremacy Clause as an instance of 7 The same error was made by Supreme Court in the related case of East Ramapo Central School District v. King (McGrath, J.). In that case, East Ramapo sought to challenge a subsequent determination by the Department that East Ramapo remained noncompliant with an earlier directive requiring it to submit applications for state reimbursement for certain private school placements. (The Department’s subsequent determination also clarified that the earlier directive applied to all private school placements—regardless of whether East Ramapo sought reimbursement from the State under the IDEA—and remained in effect.) East Ramapo disputed the Department’s finding of noncompliance with the earlier directive on the ground that the earlier directive had not applied to private school placements under the IDEA where the school district did not intend to seek reimbursement from the State. Supreme Court initially denied a motion to dismiss on numerous grounds, including failure to state a claim and lack of standing (A. 145-53). Thereafter, it granted a motion to renew on the basis of the Third Department’s decision in this case and dismissed the proceeding (A. 159-63). East Ramapo did not appeal. 32 “conflict preemption,” People ex rel. Cuomo v. First American Corp., 18 N.Y.3d 173, 179 (2011). The conflict would arise because permitting state judicial review of state educational agencies’ regulatory and enforcement decisions would short-circuit the administrative remedies established by Congress. East Ramapo argues (Br. at 26) that Congress did not preempt article 78 review because it did not clearly express an intent to foreclose state review of state agency decisions, but rather, left states free to apply their usual remedies. But if state judicial review were available outside the framework of the IDEA’s enforcement scheme, as East Ramapo urges, the result would be a highly anomalous system that Congress could not have intended. As discussed above, federal courts have discerned a congressional intent to foreclose judicial review of routine state regulatory and enforcement decisions such as the Department’s here. Although school districts may seek federal court review of a final decision by the Secretary confirming a state’s decision to reduce or withhold IDEA funds, see 34 C.F.R. § 76.401(d)(5) (allowing appeal to Secretary); 5 U.S.C. §§ 701–706 (review of final federal agency decisions), such cases appear to be rare. As a result, if East Ramapo 33 were to prevail here, state courts would become the primary arbiters of the IDEA in this area, creating a flood of state court litigation over the meaning of the federal statute and the Secretary’s regulations. This would allow a body of decisions to develop without the participation of the Secretary as a party and potentially at odds with the Secretary’s guidance and rulings. Congress could not have intended this result. Although East Ramapo cites cases in which courts declined to find state laws preempted by the IDEA (Br. at 27), those cases are inapposite because they concern state laws that created substantive rights such as state tort and anti-discrimination claims. By contrast, East Ramapo’s claims derive entirely from a right purportedly found in the IDEA itself; state law does not otherwise create an enforceable “right to settle” parental objections to IDEA student placements. East Ramapo also erroneously contends (Br. at 27) that other state courts have entertained claims similar to this one, demonstrating the absence of preemption. The two cases East Ramapo cites concern administrative complaints filed by parents with state educational agencies regarding the treatment of their children by school districts. See supra at 11-12 (discussing 34 C.F.R. § 300.151 (formerly § 300.660) 34 as implemented by 8 N.Y.C.R.R. § 200.5(l)). Independent School District No. 281 v. Minnesota Dep’t of Educ., No. A06-1617, 2007 WL 2774337 (Minn. Ct. App. Sept. 25, 2007) at *3-5, involved parents who complained about the cancellation of a special education program. And Board of Educ. v. N.J. State Dep’t of Educ., 945 A.2d 125, 129 (N.J. Super. Ct. App. Div. 2008), though it originated with an administrative complaint, turned entirely on a procedural issue under state law concerning the availability of an administrative appeal to challenge the resolution of such complaints. 2007 WL 2774337 at *3. Even assuming that the IDEA does not foreclose judicial review of the final determinations of state educational agencies regarding such administrative complaints, East Ramapo did not file an administrative complaint with the Department here, let alone the kind of administrative complaint at issue in these cases, namely one by parents against their school districts. East Ramapo makes three remaining arguments for why the absence of an enforceable “right to resolve” parental complaints under the IDEA does not foreclose article 78 review. None has merit. First, it denies (Br. at 20-21) that it is attempting to enforce the provisions of 35 the IDEA and insists (Br. at 18) it is asserting a separate state claim to be free of government decisions that are arbitrary and capricious or affected by error of law. Its argument cannot be squared with its multiple claims that the Department infringed upon its “right and discretion” under the IDEA to settle parental complaints as it deems appropriate (A. 184-87). East Ramapo is just using article 78 as a vehicle to assert these alleged statutory violations. Absent its claim that the Department’s decision is contrary to the IDEA, it would have no claim under article 78. Second, East Ramapo contends (Br. at 15-18) that it did not require “separate authorization” from the IDEA to obtain judicial review, ignoring that the IDEA is not neutral, but rather manifests an intent to preclude judicial review. See George v. Bloomberg, 2 A.D.3d 294 (1st Dep’t 2003) (no article 78 review where Congress intended to negate a private right of action under the relevant federal statute), lv. denied, 2 N.Y.3d 707 (2004). This situation differs from a state statute’s mere silence concerning the availability of judicial review, where the Legislature did not evince such an intent. See Jackson v. N.Y.S. Urban Development Corp., 67 N.Y.2d 400, 416 (1986). East 36 Ramapo is therefore wrong to read the decision below as implying that judicial review of an agency’s implementation of state law does not lie absent the provision of a private right of action in the state law at issue (Br. at 22). Rather, this case presents the far narrower issue of whether a party may obtain state judicial review of violations of its purported federal statutory rights where the relevant federal statute manifests a congressional intent to preclude judicial review. Third, citing N.Y.C. Dep’t Envtl. Prot. v. N.Y.C. Civ. Serv. Comm’n, 78 N.Y.2d 318 (1991), East Ramapo asserts (Br. at 18-19) that even if the IDEA precluded judicial review, it has a constitutional right to such review. Not so. In N.Y.C. Dep’t Envtl. Prot., this Court held that judicial review of agency decisions may not be “completely precluded” where a constitutional right is implicated or where the agency has acted “illegally” or “in excess of its jurisdiction.” Id. at 323. No such circumstances are present here. East Ramapo has not asserted the violation of a constitutional right held by the school district, nor could it do so. And the Department’s jurisdiction to enforce East Ramapo’s compliance with the IDEA is apparent from the face of the statute. See 37 20 U.S.C. § 1416(a)(1)(A). A dispute over the Department’s evaluation of a specific school district practice is not a dispute over its jurisdiction. B. Alternatively, and for similar reasons, East Ramapo lacks standing. East Ramapo’s failure to state a claim can also be viewed as a lack of standing; the same considerations underlie the analyses of both legal doctrines. Under familiar principles of New York law, standing has two elements. First, the litigant must show that it is threatened with an “injury in fact,” meaning an injury that is “real and different from the injury most members of the public face.” Matter of Save the Pine Bush, Inc. v. Common Council of the City of Albany, 13 N.Y.3d 297, 306 (2009). Second, “a party must show that the in-fact injury of which it complains (its aggrievement, or the adverse effect upon it) falls within the ‘zone of interests’ or concerns, sought to be promoted or protected by the statutory provisions under which the agency has acted.” Society of Plastics Indus., Inc. v. County of Suffolk, 77 N.Y.2d 761, 785 (1991). These principles are just as applicable to article 78 proceedings, where “a party has standing to enforce a statutory right if its abuse will cause him injury and it may fall within the ‘zone of interest’ protected 38 by the legislation.” Schwartz v. Morgenthau, 7 N.Y.3d 427, 432 (2006) (article 78 petitioner lacked standing to vindicate a purported right outside the statute’s zone of interests); see also Gym Door Repairs, Inc. v. N.Y.C. Dep’t of Educ., 112 A.D.3d 1198 (3d Dep’t 2013) (petitioner workers outside zone of interests of school safety law meant to protect students). As demonstrated below, East Ramapo fails to satisfy either requirement. 1. East Ramapo is outside the zone of interests protected by the IDEA. First, East Ramapo’s alleged injury falls outside the zone of interests protected or promoted by the IDEA because the statute does not recognize the purported statutory right whose violation forms the basis of its claims. See Schwartz, 7 N.Y.3d at 432. The IDEA was enacted for the benefit of children with disabilities and their parents rather than school districts, see 20 U.S.C. §§ 1400(c), (d); H.R. Rep. No. 105-95 (1997), reprinted in 1997 U.S.C.C.A.N. 78, 79-82, and the many procedural safeguards set forth in the IDEA are intended to enable parents to ensure the education of their children with disabilities in the 39 least restrictive environment appropriate. 20 U.S.C. § 1415(a); see also Honig v. Doe, 484 U.S. 305, 311-12 (1988). Accordingly, as discussed above, the IDEA does not bestow upon school districts an enforceable “right to settle” parental due process complaints, even where doing so may spare the parties the expense of litigation. Nor may school districts invoke the statute’s protection by claiming to act on behalf of parents who—for whatever reasons—seek placements that are more restrictive than are suitable for their children. The IDEA was not intended to provide parents with private or out-of-district placements absent proof that their children cannot be accommodated at the public schools that they would normally attend. In response to similar attempts by parties to assert violations of federal statutory rights via article 78, the departments of the Appellate Division have unanimously dismissed such cases, typically finding a lack of standing where Congress precluded the federal claims that the parties were attempting to bring in state court. Matter of Adirondack Health-Uihlein Living Center v. Shah, 125 A.D.3d 1366, 1369 (4th Dep’t), lv. denied, 128 A.D.3d 1425 (2015), for example, involved a determination by the Department of Health to calculate the Medicaid 40 reimbursement owed to petitioner health care providers in accordance with a state regulation. The providers brought an article 78 petition to contest their reimbursement amounts. Id. at 1367. Among other things, the providers contended that the regulation determining their reimbursement violated federal law because it represented a material change to New York’s Medicaid Plan that the federal government had not approved. The Fourth Department found that the providers lacked standing to assert this claim because the Medicaid Act did not allow a private right of action to enforce the requirement of federal approval of a state plan. Id. at 1369. Other departments of the Appellate Division have come to similar conclusions. The Third Department in Matter of St. Margaret’s Center v. Novello, 23 A.D.3d 817, 819-20 (3d Dep’t 2005), dismissed an article 78 proceeding for lack of standing because federal Medicaid law provides “no private right of action enforceable in the context of a C.P.L.R. article 78 proceeding for health care providers” that would allow them to challenge the Commissioner of Health’s methodology as inconsistent with federal Medicaid law. Id. at 820 (emphasis added) (citing Matter of Home Care Ass’n of N.Y.S. v. Bane, 218 A.D.3d 106, 110-11 41 (3d Dep’t 1995), lv. denied, 87 N.Y.2d 808 (1996)); see also George, 2 A.D.3d at 294 (labor unions could not bring an article 78 proceeding to challenge New York City’s application of a federal block grant where federal administrative review was the exclusive remedy). And some federal courts have treated school districts’ lack of a private right of action under the IDEA as a failure of “statutory standing.” See Lake Washington, 634 F.3d at 1069. These Appellate Division cases resemble this one because they involved article 78 petitioners claiming that a state agency charged with administering a joint federal-state program acted contrary to federal law. And the court in each case found that the petitioner lacked standing to assert the alleged federal violation in the absence of any enforceable interest conferred by the relevant federal statute. Likewise here, East Ramapo has no enforceable interest conferred by the IDEA. This Court should thus similarly affirm the dismissal of this proceeding for lack of standing. East Ramapo attempts (Br. at 20) to distinguish St. Margaret’s Center and Home Care Association as concerning claims “directly under” the Medicaid Act brought in hybrid article 78/declaratory judgment 42 actions, whereas East Ramapo did not plead claims under the IDEA, but rather sought judicial review of an agency determination. This argument is wrong for two reasons. First, neither case appears to have involved a hybrid proceeding at all; both were article 78 proceedings seeking to set aside state agency determinations as contrary to law, specifically, the Medicaid Act. Second, even if those cases had involved hybrid proceedings, there would have been an article 78 portion of any such hybrid proceedings, and the courts in those cases affirmed the dismissal of the proceedings outright, in St. Margaret’s, for lack of standing, and in Home Care Association, for failure to state a cause of action. East Ramapo also cites (Br. at 21-22) decisions from other jurisdictions holding that an aggrieved party’s right to judicial review does not depend on the existence of a private right of action under the relevant statute. But in each of these cases, standing was either not contested or the petitioner alleged a cognizable injury resulting from the statutory violation that conferred standing. Accordingly, these cases do not support the availability of judicial review here. See, e.g., AlohaCare v. Ito, 271 P.3d 621, 639 (Haw. 2012) (company suffered an 43 “injury in fact” from an agency decision that caused it to face “increased competition from allegedly improperly licensed competitors”); District of Columbia v. American University, 2 A.3d 175, 183 (D.C. 2010) (American University contesting grant of educational license to another institution using the word “American”); District of Columbia v. Sierra Club, 670 A.2d 354, 366 n.2 (D.C. 1996) (organization’s standing to seek review of termination of recycling program was “not challenged”); Hedgepeth v. N.C. Div. of Servs. for the Blind, 142 N.C. App. 338 (N.C. Ct. App. 2001) (petitioner was a member of protected class who was denied benefits) (abrogated on other grounds); see also Hernandez- Avalos v. I.N.S., 50 F.3d 842, 847 (10th Cir.) (petitioners invoking the Mandamus Act did not have to demonstrate an implied right of action, but they lacked standing because they fell outside the zone of interests protected by the substantive statute), cert. denied, 516 U.S. 826 (1995). 2. East Ramapo lacks an in-fact injury. Second, East Ramapo lacks an in-fact injury because it was not aggrieved by the Department’s December 2012 determination. The only remedial actions ordered by the Department were for East Ramapo to prospectively follow the proper settlement procedures under the IDEA 44 and related state law and perform certain additional ministerial tasks, none of which injured the school district. See East Ramapo Central School District, 2013 WL 5508392 at *8 (the Department’s directive “does not prevent the District from complying with the IDEA in general or settling disputes in particular”). Although East Ramapo alleges that the Department improperly inferred more widespread improprieties on the basis of the documentation of just 21 resolution meetings, it asserts no injury resulting from any such inference. (See A. 180-83.) There is no claim that the Department sanctioned East Ramapo in any way, let alone on the basis of any widespread practice. The Department simply directed East Ramapo to comply with IDEA procedures going forward. Indeed, the Department’s directive is notable for what it does not do: it neither sanctions East Ramapo nor orders East Ramapo to abrogate any of the parental settlement agreements already finalized. Had the Department sought to withhold IDEA funds based on East Ramapo’s noncompliance, East Ramapo would have been entitled to notice and a hearing, and an appeal to the U.S. Secretary of Education of any adverse decision by the Department. See 34 C.F.R. § 76.401(d)(5). The Secretary would then have had an opportunity to review the 45 Department’s evaluation of East Ramapo’s settlement practices, and East Ramapo could have challenged any final decision by the Secretary in federal court. See 5 U.S.C. §§ 701—706. East Ramapo did not pursue such administrative remedies, however, making it speculative as to whether it would ultimately have sustained an injury that could support standing. See N.Y.S. Assoc. of Nurse Anesthetists v. Novello, 2 N.Y.3d 207, 214 (2004) (no in-fact injury where harm is speculative). Accordingly, this Court should find that East Ramapo did not sustain an in-fact injury. C. The Department adequately preserved its standing defense, which is in any event nonwaivable. The Department raised the defense of failure to state a cause of action in its answer to East Ramapo’s petition (A. 317). Then on appeal to the Appellate Division, the Department argued more specifically that East Ramapo failed to state a claim cognizable in an article 78 proceeding; specifically, East Ramapo failed to identify a right judicially enforceable by a school district against a state educational agency. The Department also cited the aforementioned Appellate Division cases holding that a party lacks standing to bring federal claims via article 78 46 where Congress has precluded such claims. Although the Department’s argument below was labelled as a “failure to state a claim” rather than a lack of standing, the Department’s argument was sufficient to preserve the standing defense because both arguments turn on East Ramapo’s lack of a cognizable claim. Even if this Court were to conclude that the Department did not adequately preserve a standing defense, the Court should nevertheless entertain the issue for any of three reasons. First, ample authority supports the view that standing is an aspect of justiciability that implicates a court’s subject-matter jurisdiction and thus should be deemed nonwaivable under C.P.L.R. 3211(a)(2) and (e). See City of New York v. State of New York, 86 N.Y.2d 286, 292 (1995) (“The issue of lack of capacity to sue does not go to the jurisdiction of the court, as is the case when the plaintiffs lack standing”) (emphasis added); Matter of N.Y.S. Inspection, Sec. & Law Enforcement Empls. v. Cuomo, 64 N.Y.2d 233, 241 n.3 (1984) (treating ripeness defense as subject-matter jurisdictional defense under C.P.L.R. 3211(a)(2) because it goes to justiciability); Matter of Eaton Ass’n v. Egan, 142 A.D.2d 330, 334-35 (3d Dep’t 1988) (Levine, J.) (standing 47 “goes to the jurisdictional basis of a court’s authority to adjudicate a dispute”); Matter of Battenkill Ass’n of Concerned Citizens v. Town of Greenwich Planning Bd., 156 A.D.2d 863, 865 (3d Dep’t 1989) (citing Eaton for purposes of noting that standing issues can properly be raised either by motion or sua sponte by the court if necessary); Axelrod v. N.Y.S. Teachers’ Retirement Sys., 154 A.D.2d 827, 828 (3d Dep’t 1989) (“Since standing is jurisdictional and goes to a court’s authority to resolve litigation, [the Court] can raise this matter sua sponte.”). See generally Society of Plastics Indus., 77 N.Y.2d at 784 (standing “is an aspect of justiciability” and the requirement of injury in fact “serves to define the proper role of the judiciary”); Siegel, New York Practice § 136, at 240 (5th ed.) (New York courts lack subject matter jurisdiction 48 over a case brought by a person who is not aggrieved by the defendant’s actions because there is no genuine controversy).8 Second, if the common-law defense of standing does not implicate a court’s subject-matter jurisdiction, then it is more akin to an objection for failure to state a cause of action, which is not waivable under C.P.L.R. 3211(a)(7) and (e), than to a capacity defense, which is waivable under C.P.L.R. 3211(a)(3) and (e). See Sterritt v. Heins Equip. Co., 114 A.D.2d 616, 617 (3d Dep’t 1985) (affirming dismissal of complaint for failure to state a cause of action where plaintiff lacked standing); Field v. Allen, 9 A.D.2d 551 (3d Dep’t 1959) (explaining 8 We recognize the contrary authority treating the affirmative defense of lack of “standing” as identical to the defense of lack of “legal capacity” under C.P.L.R. 3211(a)(3) and thus holding, pursuant to C.P.L.R. 3211(e), that a standing defense is waived if not raised in a motion to dismiss or responsive pleading. See, e.g., Matter of Plainview-Old Bethpage Congress of Teachers v. N.Y.S. Health Ins. Plan, 123 A.D.3d 1140, 1141 (3d Dep’t 2015); EMC Mortgage Corp. v. Gass, 114 A.D.3d 1074, 1075 (3d Dep’t 2014); Kruger v. State Farm Mutual Auto. Ins. Co., 79 A.D.3d 1519 (3d Dep’t 2010); Gilman v. Abagnale, 235 A.D.2d 989, 990 (3d Dep’t 1997); see also Wells Fargo Bank Minnesota, Natl. Ass’n v. Mastropaolo, 42 A.D.3d 239, 241-44 (2d Dep’t 2007). These cases assume without analysis that the standing defense must be treated as one of the defenses listed in C.P.L.R. 3211(a). They may be in error on that basis alone. See infra at 50. They also reason that the standing defense is more akin to capacity than to subject-matter jurisdiction. By doing so, they ignore that standing and capacity are legally distinguishable, and that, unlike capacity, standing requires an inquiry into whether a party has an actual legal stake in the matter being litigated so as to render the controversy justiciable. See Society of Plastics, 77 N.Y.2d 761, 784-85. Indeed, treating the standing defense as a waivable defense is in tension with the well-settled law that courts do not render advisory decisions. See Cuomo v. Long Isl. Lighting Co., 71 N.Y.2d 349, 354 (1988). 49 distinction between absence of capacity to sue and absence of right to relief); Rainbow Hospitality Mgt. v. Mesch Engr., 270 A.D.2d 906 (4th Dep’t 2000) (objection that plaintiff had no right to relief because it sustained no injury as a result of defendant’s conduct can be raised at any time); Truty v. Federal Bakers Supply Corp., 217 A.D.2d 951, 952 (4th Dep’t 1995) (dismissing complaint for failure to state a cause of action where plaintiff lacked standing). Thus, because the Department asserted an objection for failure to state a cause of action in its answer (A. 317), it adequately preserved the common-law standing defense. Finally, because C.P.L.R. 3211(a) does not expressly address the common-law defense of standing, the defense need not be analyzed under 3211(a) at all. C.P.L.R. 3211(a) lists grounds (11 in all) on which a party “may” move for judgment dismissing one or more causes of action asserted against it. The provision thus need not be read as providing an all-encompassing list of such defenses. Because the standing defense is not listed in C.P.L.R. 3211(a), it should be analyzed under C.P.L.R. 3018(b), which more generally addresses affirmative defenses. And C.P.L.R. 3018(b) simply requires a party to plead all matters which would be likely to take the adverse party by surprise or 50 would raise issues of fact not appearing on the face of a prior pleading. Where, as here, a standing defense presents a pure question of law that could not have been countered had it been raised below, C.P.L.R. 3018(b) does not require that it be pled, and it may be asserted for the first time on appeal. See Matter of Fleischer v. New York State Liquor Auth., 103 A.D.3d 581, 584 (1st Dep’t) (so holding), lv. denied, 21 N.Y.3d 856 (2013); see also Delgado v. New York City Bd. of Educ., 272 A.D.2d 207 (1st Dep’t 2000) (same), lv. denied, 95 N.Y.2d 768 (2000), cert. denied, 532 U.S. 982 (2001). See generally Sega v. State, 60 N.Y.2d 183, 190 n. 2 (1983) (respondent may assert an unpreserved legal argument that appears on face of record as a basis to affirm if it could not have been avoided if brought to appellant’s attention earlier). For all these reasons, even if it determined that the Department did not sufficiently raise a standing defense below, this Court should entertain the issue for the first time on appeal in this case, rather than permit an article 78 proceeding to go forward in the absence of a cognizable injury in fact. 51 POINT II ALTERNATIVELY, THE COURT SHOULD AFFIRM ON THE MERITS FOR THE REASONS STATED BY SUPREME COURT Alternatively, this Court should endorse the findings of Supreme Court and affirm on the basis that the Department’s December 2012 determination was not arbitrary, capricious or affected by error of law. Under well-settled law, judicial review of administrative determinations is “extremely deferential” and limited to whether there is any rational basis to support them. See Matter of Beck-Nichols v. Bianco, 20 N.Y.3d 540, 559 (2013); Matter of Pell v. Bd. of Educ. of Union Free School District No. 1 of Towns of Scarsdale and Mamaroneck, 34 N.Y.2d 222, 230-31 (1974). The Department’s December 2012 determination readily satisfies this standard. A. The Department reasonably concluded that East Ramapo failed to follow proper procedures. First, the Department’s conclusion that East Ramapo failed to follow proper procedures in the 21 cases it reviewed had a rational basis in the record. In response to East Ramapo’s petition, the Department submitted an affidavit from Assistant Commissioner James P. DeLorenzo, head of the Department’s Office of Special Education, along 52 with documentation of the Department’s ongoing efforts to enforce the IDEA’s requirements against East Ramapo. Assistant Commissioner DeLorenzo supervised the review of East Ramapo’s IDEA compliance and rendered the determination at issue (A. 334-52). Assistant Commissioner DeLorenzo described East Ramapo’s past history of noncompliance concerning its placement of students with disabilities at private special education schools (A. 339-41), and furnished the court with copies of correspondence documenting that history (A. 389-416). That evidence established that since April 2010, the Department had been repeatedly advising East Ramapo of its noncompliance with the documentation requirements for private school placements. The Department had also sought over an extended period of time to work with East Ramapo to cure that noncompliance by extending the deadlines for the school district to take the requisite corrective action. But in its July 2012 monitoring review, the Department learned that East Ramapo had still failed to resolve that earlier noncompliance because it continued to lack adequate documentation to support several of its private school placements. Specifically, East Ramapo had failed to document its efforts to place the 53 students at issue in public facilities and the results of those efforts (A. 422). The Department therefore ordered East Ramapo to continue to submit paper applications for approval of reimbursement from the State for placements at three identified private schools (A. 342-43). Assistant Commissioner DeLorenzo also detailed the bases of the new violation that the Department found in its July 2012 monitoring review. From its examination of the records of 21 resolution meetings conducted by East Ramapo with parents of students with disabilities who had objected to the CSE’s placement recommendations for their children, the Department concluded that East Ramapo was misusing the parental dispute-resolution process (A. 342). In particular, East Ramapo was circumventing the role of the CSE—and in the process undermining the goal of the IDEA to educate students in the least restrictive environment suitable—by permitting a single representative of the school district to enter into settlement agreements with parents who had objected to the CSE’s recommendations, often by agreeing to provide the very out-of-district placement requested by the parents, even though the CSE had not deemed such placements to be necessary or appropriate (A. 342). 54 Moreover, although federal and state regulations require that, to the extent possible, students with disabilities be educated in the school that they would attend if not disabled, see 34 C.F.R. § 300.116(c); 8 N.Y.C.R.R. § 200.4(d)(ii), 20 of the 21 settlements reviewed resulted in placements at either special education private schools (14 cases) or a single out-of-district public school (6 cases) (A. 194, 343). And the justification offered for the majority of these placements (14 of them) was a purported need for Yiddish bilingual special education programs (A. 350), even though in 12 of these 14 cases, the students had no documented need for such programs. Indeed, the CSE, comprised of experts familiar with the students’ needs, concluded that 11 of the 12 students were not what is termed “English Language Learners,”9 meaning they did not need bilingual educational services at all (A. 195, 350). Indeed, East Ramapo’s petition does not directly challenge the Department’s findings in the 21 cases reviewed. Rather, its evidentiary challenge primarily asserts that from its findings in these 21 cases, the 9 One of the 12 students was identified as an “English Language Learner,” but the student’s IEP did not indicate a language need in relation to the programs recommended in the student’s IEP (A. 195). The other 11 students were not identified as “English Language Learners” at all (A. 195). 55 Department irrationally inferred a more widespread practice of noncompliance, specifically as to the role of the CSE in recommending placements (A. 180) and a pattern of placing students in out-of-district programs based on a need for a Yiddish bilingual program (A. 181-82).10 In fact, however, the Department did not draw any conclusions about more widespread practices at East Ramapo; it simply found a lack of compliance with the IDEA in the 21 cases it reviewed and directed East Ramapo to comply with the IDEA in the future. Accordingly, the Department reasonably concluded that East Ramapo’s settlement practices were inconsistent with the IDEA and implementing state laws and regulations and directed East Ramapo to comply with the statute on a prospective basis. 10 The only other evidentiary challenges raised by East Ramapo did not actually address the Department’s findings at all. East Ramapo took issue with a statement in one of the Department’s subsequent letters that had no bearing on the Department’s December 2012 determination of noncompliance regarding the 21 settlements at issue (A. 182). East Ramapo also quibbled with the Department’s conclusion that a single district representative had “unilaterally” overridden the CSE’s placement recommendations because it ignored the role that the parents had played in the subject settlements (A. 183). By its use of the term “unilateral,” however, the Department was simply referring to the undisputed fact that, while the placement recommendations had been made by the full CSE panel, the settlements were agreed to by a single representative of the school district. 56 B. The Department’s determination did not reflect an erroneous interpretation of federal law. The Department’s December 2012 determination was also not affected by error of law. The Department was fully entitled to review whether East Ramapo was providently exercising its discretion to settle parental complaints, and its judgment in that regard is entitled to deference. See 20 U.S.C. § 1416(a)(1)(A). To be sure, a school district may compromise a meritorious parental due process complaint by agreeing to a placement that differs from the one recommended by the CSE, without obtaining the CSE’s approval. See 71 Fed. Reg. 46703 (Aug. 14, 2006) (discussion of 34 C.F.R. § 300.510(d)). As noted above, however, that is not what occurred here. The Department instead found that East Ramapo had repeatedly settled parental complaints without an adequate basis. Even if the parents may have believed that their children needed Yiddish bilingual special education programs, the District had an obligation under the IDEA to evaluate the parents’ claims to ensure that these students were not being placed in more restrictive settings than were otherwise suitable for them. That is especially so where the students’ CSE, composed of teachers and 57 experts from the District familiar with the students’ needs, did not identify a need for bilingual special education (A. 343). Even granting a federal policy that recognizes the benefits of settlements, the IDEA does not countenance settlements that result in more restrictive placements than are appropriate for students without adequate justification, including without a determination that the out-of-district placement suits the needs of the child. See School Community of Burlington v. Dep’t of Educ., 471 U.S. 359, 370 (1985). And this Court should not substitute its judgment of East Ramapo’s settlement practices for that reached by the Department in its statutory role as state monitor. See Matter of Boatman v. N. Y. S. Dept. of Educ., 72 A.D.3d 1467 (3d Dep’t 2010). In sum, the Department reasonably exercised its authority as a state educational agency by ordering East Ramapo to document its private school placements and adhere to the IDEA in settling parental due process complaints. The Department’s directive to East Ramapo to follow the proper procedures does not unduly impair its ability to settle such complaints, but seeks to ensure that it does so consistent with the statute. Accordingly, if this Court determines that it is appropriate to 58 reach the merits of this dispute, it should affirm on the basis that the Department’s determinations were not arbitrary, capricious or affected by error of law. 59 CONCLUSION The opinion and order of the Appellate Division, Third Department, should be affirmed. Dated: Albany, New York May 16, 2016 BARBARA D. UNDERWOOD Solicitor General ANDREA OSER Deputy Solicitor General JEFFREY W. LANG Assistant Solicitor General of Counsel Respectfully submitted, ERIC T. SCHNEIDERMAN Attorney General of the State of New York Attorney for Respondents By: ______________________________ JEFFREY W. LANG Assistant Solicitor General Office of the Attorney General The Capitol Albany, New York 12224 Telephone: (518) 776-2027