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Henderson v. Missouri Department of Social Services

United States District Court, E.D. Missouri, Eastern Division

October 10, 2019




         This matter is before the Court on defendant's motion for summary judgment, pursuant to Rule 56, Fed.R.Civ.P. Plaintiff has filed a response in opposition and the issues are fully briefed.[1] The parties have consented to the jurisdiction of the undersigned United States Magistrate Judge pursuant to 28 U.S.C. § 636(c).

         Plaintiff Carla Henderson, a legally-blind African American woman, alleges that defendant Missouri Department of Social Services[2] denied her a position as the manager of a vending facility based on her race and disability. She further alleges that defendant failed to comply with the outcome of an arbitration proceeding before the United States Department of Education pursuant to which she was to be awarded a vending facility. She brings claims for impairment of her right to contract in violation of 42 U.S.C. § 1981 (Count I); disability discrimination in violation of the Americans with Disabilities Act (ADA), 42 U.S.C. §§ 12101 et seq. (Count II), and the Rehabilitation Act, 29 U.S.C. § 705 (Count III); deprivation of her civil rights in violation of 42 U.S.C. § 1983 (Count IV); retaliation in violation of Title VII of the Civil Rights Act, 42 U.S.C. § 2000e-3, and the ADA (Count V); and a claim for declaratory judgment under the “Uniform Arbitration Act” (Count VI). Defendant moves for summary judgment, arguing that the Arbitration Panel retains exclusive jurisdiction over plaintiff's claims, that plaintiff's claims in Counts I and IV are barred by sovereign immunity; that her claims in Counts I through V are barred by the Randolph-Sheppard Act, 20 U.S.C. §§ 107 et seq.; that she has failed to state a claim for relief under the ADA and Rehabilitation Act; and that declaratory relief is not available on review of an arbitration award.[3]

         I. The Randolph-Sheppard Act

         Congress enacted the Randolph-Sheppard Act (RSA) in 1936 to provide employment opportunities to individuals with vision impairments. 20 U.S.C. § 107(a). The RSA authorizes licensed blind persons “to operate vending facilities on any Federal property, ” id., and requires the federal government and cooperating state licensing agencies to give priority to licensed blind vendors in “the operation of [these] vending facilities, ” § 107(b). Blind licensees operating vending facilities on federal property earn a percentage of all income generated by vending machines located on that property, even if those machines are not operated by program participants. § 107d-3(a).

         The RSA creates partnerships between the federal government and states that choose to participate. Jones v. DeNotaris, 80 F.Supp.3d 588, 590 (E.D. Pa. 2015). On the federal side, the RSA assigns to the United States Secretary of Education rulemaking, information-gathering, and oversight responsibilities. Id. (citing § 107a(a)). The Department of Education “designate[s] the State agency for the blind in each State . . . to issue licenses to blind persons” to operate vending facilities on federal property. § 107a(a)(5). The state licensing agencies, in turn, both select the locations for vending facilities and the operators of the facilities, “giv[ing] preference to blind persons who are in need of employment.” § 107a(b)-(c).

         The RSA provides a grievance procedure for “dissatisfied” blind vendors: state licensing agencies participating in the program must agree “to provide to any blind licensee dissatisfied with any action arising from the operation or administration of the vending facility program an opportunity for a fair hearing.” § 107b(6). If the licensee remains dissatisfied after the hearing, he or she may seek binding arbitration through the Department of Education. § 107d-1(a). “[T]he decision of such panel shall be final and binding on the parties, ” but is “subject to appeal and review as a final agency action for purposes of” judicial review in accordance with the Administrative Procedure Act (APA), 5 U.S.C. § 706. North Carolina Division of Services For The Blind, v. U.S. Dep't Of Educ., No. 1:17CV1058, 2019 WL 3997009, at *2 (M.D. N.C. Aug. 23, 2019); see also Jones, 80 F.Supp.3d at 591 (“Although the RSA nowhere creates a private cause of action, ” judicial review of the panel's decision is available through the APA). On review, the Court “must uphold [an RSA arbitration panel] decision if it is supported by ‘substantial evidence,' and is not ‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.'” Id. (quoting Browder v. U.S. Dep't of Educ., 238 F.3d 410 (4th Cir. 2000) (per curiam)). “In determining whether final agency action, such as an RSA arbitration award, violates [S]ection 706(2)(A) of the APA, [the Court] perform[s] only the limited, albeit important, task of reviewing agency action to determine whether the agency conformed with controlling statutes, and whether the agency has committed a clear error of judgment.” Id. (alterations in original; internal quotation marks omitted).

         II. Background [4]

         Plaintiff is a licensed vending manager and participant in the Blind Enterprise Program (BEP), the licensing agency that administers the Randolph-Sheppard Act (RSA) for the State of Missouri. On February 28, 2014, Larry Branson, the BEP manager, notified licensed managers of an opening for a manager at a cafeteria/convenience store, identified as VF #2. Plaintiff submitted a bid on March 5, 2014, and interviewed with the executive committee of the Blind Vendors of Missouri on March 22, 2014. Branson also attended the interview. Christopher White, a legally-blind Caucasian man, was selected for the manager position at VF #2.

         Plaintiff requested an administrative review, alleging that she was discriminated against on the basis of race and gender and that the BEP failed to properly support her in the management of her current facility, which affected her ability to compete for other facilities. The review proceeding upheld the decision to select Mr. White for the VF #2 manger position. Plaintiff next sought a fair hearing, which was conducted on June 27, 2014. The decision to select Mr. White was again upheld. Plaintiff then exercised her right for an arbitration hearing from the United States Department of Education.

         A three-person arbitration panel held a hearing on August 9, 2016. In a decision issued on October 13, 2016, the arbitration panel found that Branson made false disparaging statements about plaintiff that resulted in her not being awarded VF #2 and that her bid was denied based on racism and discrimination. The panel directed the RSB to award plaintiff “the next comparable Level 4 facility with a history of generating profitable income that becomes available and mutually agreed to by” plaintiff and the RSB. The arbitration panel also retained jurisdiction to consider any issue arising from implementation of its award.

         In April 2018, plaintiff asked to be awarded the contract for a Level 4 facility located at Fort Leonard Wood pursuant to the arbitration award. See e-mail exchange [Doc. # 66-1]. James Brinkmann, supervisor of the BEP, informed her that the contract would not be awarded to her because the facility was not comparable to VF #2. Id. According to a spreadsheet prepared by Mr. Brinkmann, VF #2 served approximately 200 meals a day, while the Fort Leonard Wood facility averaged more than 28, 000 meals a day. Similarly, VF #2 averaged 7 employees while Fort Leonard Wood had 947 employees. Finally, VF #2's gross income in 2017 was $837, 000 while Fort Leonard Wood's income for the same period was in excess of $35 million. [Doc. # 75].

         Mr. Brinkmann states that between October 25, 2016, and April 19, 2019, ten Level 3 and Level 4 facilities were offered to plaintiff. Plaintiff declined all ten facilities, including VF #2 which she was again offered on April 19, 2019. James Brinkmann Second Aff. ¶¶ 8-10 [Doc. # 70-3].

         In July 2017, plaintiff filed this action in which she reasserts the allegations she asserted before the arbitration panel: that the BEP violated her civil rights and discriminated against her on the basis of her disability and race by not selecting her for the opening at VF #2. In particular, plaintiff alleges that she applied for VF #2, that Larry Branson made false statements about her to the decisionmakers, and that a white male applicant was awarded VF #2. “Third Amended Complaint”[5] at ¶¶ 12-19 [Doc. # 39]. In this proceeding, plaintiff claims in Count I that defendant “fail[ed] and refus[ed] to provide [her] with essentially the same opportunity to make contracts for employment as her white, male, able-bodied counterparts, ” in violation of 42 U.S.C. § 1981. ¶ 34. Similarly, she claims in Count IV that that defendant “fail[ed] and refus[ed] to provide [her] with a fair and unadulterated application process for a state-run employment program in which [she] was qualified to participate” on the basis of her race and disability, in violation of 42 U.S.C. § 1983. ¶ 48. In Counts II and III, she claims that she was denied participation in and excluded from a program providing benefits for the disabled in violation of the ADA and Rehabilitation Act. ¶¶ 39, 44. In Count V, brought under Title VII and the ADA, plaintiff claims that she was denied the VF #2 and Fort Leonard Wood facilities in retaliation for an earlier grievance she filed against Branson. ¶¶ 52-57. For Counts I through V, plaintiff seeks compensatory and punitive damages and an order ...

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