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Wright-Gray v. Illinois Dep't of Healthcare and Family Services

January 26, 2010

KIMBERLY WRIGHT-GRAY, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, PLAINTIFF,
v.
THE ILLINOIS DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES (FORMERLY THE ILLINOIS DEPARTMENT OF PUBLIC AID); BARRY S. MARAM, IN HIS OFFICIAL CAPACITY AS DIRECTOR; BARRY S. MARAM, IN HIS INDIVIDUAL CAPACITY; AND DOES 1 -- 10, DEFENDANTS.



The opinion of the court was delivered by: Honorable David H. Coar

MEMORANDUM OPINION AND ORDER

Kimberly Wright-Gray, as a putative class representative, has filed suit under 42 U.S.C. § 1983 against the Illinois Department of Healthcare and Family Services ("IDHFS"), its director Barry S. Maram, in both his official and individual capacities, and ten "Doe" defendants. She alleges that the defendants violated federal Medicaid law, the Fifth and Fourteenth Amendments, and various provisions of Illinois law by asserting an automatic lien against her workers' compensation settlement in order to recoup the cost of medical services that the state Medicaid program paid on her behalf. She seeks both monetary and injunctive relief. IDHFS and Maram have moved to dismiss the complaint. For the following reasons, the motion to dismiss is GRANTED in part and DENIED in part.

FACTS

The factual allegations in the complaint, which the court must accept as true for present purposes, are as follows: After sustaining work-related injuries to her right knee and to her hands, Kimberly Wright-Gray received medical benefits under Illinois' Medicaid program. She also settled a workers' compensation claim with her employer. Like the "vast majority" of such settlements, Wright-Gray's $8500 settlement did not include any reimbursement for the medical services she sought as a result of her injuries. Pursuant to state law, IDHFS (which administers Illinois' Medicaid program) asserted an automatic lien on Wright-Gray's settlement funds. In order to receive the balance of her funds, Wright-Gray had to write IDHFS a check, drawn against those funds, to repay the cost of the medical expenses that Illinois' Medicaid program had paid on her behalf. IDHFS continues its general practice of asserting liens on, and collecting payments from, third-party settlements of Medicaid recipients even when those settlements do not include any compensation for medical services.

LEGAL STANDARD

To survive a motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), a complaint need only contain a "short and plain statement of the claim showing that the pleader is entitled to relief," Fed. R. Civ. P. 8(a)(2), that is, "a claim to relief that is plausible on its face." Bell Atlantic v. Twombly, 550 U.S. 544, 570 (2007); see also Ashcroft v. Iqbal, 129 S.Ct. 1937 (2009) (Twombly applies to "all civil actions"). This requirement imposes two relatively low hurdles. First, a complaint "must describe the claim in sufficient detail to give the defendant 'fair notice of what the claim is and the grounds upon which it rests.'" EEOC v. Concentra Health Servs., 496 F.3d 773, 776 (7th Cir. 2007) (quoting Twombly, 127 S.Ct. at 1964). Second, the allegations "must plausibly suggest that the defendant has a right to relief, raising that possibility above a 'speculative level.'" Concentra, 496 F.3d at 776. If the allegations do not suggest a right to relief-if for instance, a plaintiff relies merely on conclusions, labels, or formulaic recitations of the elements of a cause of action-a Rule 12(b)(6) motion should be granted. Twombly, 550 U.S. at 570.

ANALYSIS

Count I: Monetary Damages

In Count I, Wright-Gray seeks monetary damages under § 1983, naming as defendants IDHFS and its director, Barry S. Maram, in both his official and individual capacities. No matter the named defendant, Count I is barred by the Eleventh Amendment.

The principle of sovereign immunity is a fundamental constitutional limitation on the federal judicial power.*fn1 See, e.g., Pennhurst State Sch. & Hosp. v. Halderman, 465 U.S. 89, 98 (1984). It bars any suit brought in a federal court against an unconsenting state by its own citizens or by citizens of another state. Id.; Edelman v. Jordan, 415 U.S. 651, 663 (1974) (citations omitted); see U.S. CONST. amend. XI. Sovereign immunity bars legal as well as equitable relief where the state or one of its agencies is the named defendant. Pennhurst, 465 U.S. at 100; Burrus v. State Lottery Comm'n of Ind., 546 F.3d 417, 420 (7th Cir. 2008) (state agencies treated as state for sovereign-immunity purposes).

IDHFS is a department of Illinois state government created under Illinois law, see 20 ILCS 5/5-15, and is therefore immune from suit. Indeed, IDHFS used to be known as the Illinois Department of Public Aid-precisely the agency that was immune from suit in Edelman, 415 U.S. at 653. Nothing has changed but the name, and Illinois still declines to waive its sovereign immunity to suit in federal court. See 705 ILCS 505/1 et seq.; 745 ICLS 5/1. Therefore, IDHFS must be dismissed as a named defendant in this lawsuit.

Naming Barry S. Maram as a defendant will not remove the sovereign-immunity bar to Count I. First, Wright-Gray names Maram in his official capacity as director of IDHFS. "[A] suit against a state official in his or her official capacity is not a suit against the official but rather is a suit against the official's office. As such it is no different from a suit against the State itself." Will v. Mich. Dep't of State Police, 491 U.S. 58, 71 (1989); see also Edelman, 415 U.S. 651 (sovereign immunity bars monetary relief where director of Illinois Department of Public Aid is named defendant). Thus, naming Maram in his official capacity will not allow Wright-Gray to sue for monetary damages.

Second, Wright-Gray names Maram in his individual capacity. A state official is amenable to an individual-capacity suit for damages under § 1983, provided that the wrongful conduct is "fairly attributable to the officer himself" and "the relief is sought not from the state treasury but from the officer personally." Alden v. Maine, 527 U.S. 706, 757 (1999). WrightGray's incantation of "individual capacity," however, comes to nothing more than an exercise in captioning a lawsuit; if permitted, it would turn the doctrine of sovereign immunity into a hollow formalism. See Idaho v. Couer d'Alene Tribe of Idaho, 521 U.S. 261, 270 (1997) ("The real interests served by the Eleventh Amendment must not be sacrificed to elementary mechanics of captions and pleading.").

Wright-Gray alleges nothing that could sustain a suit against Maram in his individual capacity. Her complaint is entirely fueled by the allegation that "the State of Illinois passed laws under which, when a Medicaid recipient obtains a workers' compensation settlement following payment of medical costs on his or her behalf, a lien is automatically imposed on the settlement." (Compl. ¶ 21, emphasis added.) Pursuant to these state laws, she alleges, "the State of Illinois has received monies in violation of federal law." (Id. ¶ 2.) Wright-Gray has a problem with Illinois law-it conflicts with federal statutory and constitutional law, on her understanding-not with the individual conduct of Barry Maram. He figures in the complaint merely as the state executive official in charge of the agency that enforces the allegedly invalid law. That makes him a classic Ex parte Young defendant, because he would precisely not "come to court as [an] ...


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