Richardson Independent School District v. Michael Z Ex Rel. Leah Z

In this case arising under the Individuals with Disabilities Education Act (“IDEA”), Richardson Independent School District (“RISD” or the “District”) appeals the district court’s judgment in favor of Appellees Michael Z. and Carolyn Z. as next friends of their daughter Leah Z. Specifically, the district court determined that RISD failed to provide Leah with a free appropriate public education as required under IDEA, and that RISD was therefore required to reimburse the parents for certain costs associated with Leah’s placement in a private residential facility. The district court also awarded the parents attorneys’ fees and costs, granting total relief in the amount of $91,482.60. For the following reasons, we vacate and remand.

I

Leah Z., a minor child at all relevant times, was diagnosed with attention deficit disorder, oppositional defiant disorder, bipolar disorder, autism, separation anxiety disorder, and pervasive developmental disorder. After experiencing emotional and behavioral difficulties at numerous private schools, Leah entered RISD for fifth grade in the fall of 1999. Leah’s various diagnoses qualified her for special education and related services from RISD. Under IDEA, RISD was obligated to provide Leah with an education tailored to her specific needs through an individualized education program (“IEP”). In Texas, the committee responsible for preparing Leah’s IEP was an Admission, Review, and Dismissal Committee (“ARD Committee” or “Committee”).

In seventh grade, Leah entered West-wood Junior High School where she was placed in a Behavior Adjustment (“BA”) class. An ARD Committee meeting report indicates that in October 2002, during Leah’s eighth-grade year, she was writing at a second- to third-grade level, reading at a third-grade level, and performing math at a sixth-grade level.1 Leah’s behavioral and academic difficulties increased in eighth grade and she experienced significant regression over the summer prior to ninth grade. When Leah began ninth grade at Westwood *290Junior High School, the ARD Committee met to revise her IEP.2 Nonetheless, Leah’s academic and behavioral difficulties escalated. In the fall she began leaving class without permission almost daily. Leah arrived at school late, took lengthy breaks of up to two hours at a time, and left early. In November, Leah ran away from school and was eventually caught by the school police officer. At her mother’s request, she was issued a citation for leaving school grounds. On a recommendation from Leah’s psychiatrist, RISD educated Leah in a “homebound” setting for four days prior to the winter break.

After winter break, Leah returned to Westwood and was placed in a different BA class. Though the transition was initially smooth, by mid-January Leah was again arriving late, leaving early, and wandering outside the classroom without permission. Numerous incidents occurred, including Leah evading school officers, overturning furniture, insulting teachers, using profane language, and disrupting testing. In evaluating the conflicting evidence of how the school reacted to Leah’s frequent absences from class, the district court concluded that sometimes RISD employees supervised Leah during her absences and sometimes they did not.

In February, it was discovered that during unsupervised absences from class Leah was engaging in sexual activities with other students in the bathroom. Her psychiatrist recommended that Leah remain home until an alternative placement could be found, and RISD agreed. In March, Leah was transferred to Richardson High School (“RHS”) and placed in a BA class. Since the teacher of this class was on maternity leave, RISD hired a long-term substitute, who was not certified to teach in Texas, to supervise Leah. RISD offered little assistance to the substitute. For example, she was not given Leah’s IEP, and no one explained to her that Leah’s major problem was fleeing from class. It appears that most of the information the substitute had about Leah came from Leah’s mother. Leah remained at RHS for only two weeks, during which the pattern of disruptive behavior and refusal to work continued. Later in March, an incident occurred at home where Leah scratched her father and caused him to bleed. Her psychiatrist recommended Leah’s admission to a psychiatric facility, and Leah’s parents eventually placed her at the Texas NeuroRehab Center (“TNRC”). As of April 5, 2004, Leah’s parents had unilaterally removed her from RISD without notice to the District.

At TNRC, Leah attended the on-site University Charter School (“UCS”), a public charter school. UCS developed an IEP for Leah and provided her with physical therapy, occupational therapy, and counseling. Her adverse behavior continued and included numerous instances of groping staff members and other patients, attempting to remove other patients’ clothing, refusing to follow directions or attend class, and engaging in self-mutilation. She was frequently physically restrained or placed in locked confinement. Leah’s doctor, Dr. Mehta, considered Leah one of her most difficult patients. Dr. Mehta attributed Leah’s behavioral problems to three factors: 1) Leah testing her limits in the restrictive TNRC placement; 2) the fre*291quent changes made in her medications in an attempt to find the correct medication for her disorders; and 3) rapid and cyclical changes in her mood and behavior caused by her bipolar disorder. Dr. Mehta testified that Leah’s behavior did not significantly improve until shortly after Leah started taking the medication Clozaril. The doctor attributed Leah’s improvement to a combination of TNRC’s structured environment, the medication, and intensive counseling and therapy sessions. Leah was discharged from TNRC on November 12, 2004, with the recommendation that she attend a special education class with one-on-one supervision to prevent future behavioral problems related to lack of supervision.

Meanwhile, in June 2004 Leah’s parents requested an ARD Committee meeting to request Leah’s placement at TNRC. After reviewing Leah’s assessments from TNRC, the ARD Committee found that RISD remained capable of providing her with a free appropriate public education and denied the request for private residential placement. The Committee developed an updated IEP (the “June 2004 IEP”) that attempted to account for Leah’s sexual and aggressive behavior. Leah’s parents argued to the Committee that the new IEP failed to adequately account for her behavioral or academic regression. The district court found that the June 2004 IEP was substantially similar to Leah’s previous IEPs.

In July 2004, Leah’s parents filed a request for an administrative due process hearing alleging that RISD failed to provide Leah with a free appropriate public education and requesting reimbursement for her placement at TNRC. The Hearing Officer found in favor of the parents and awarded them $56,000. The district court agreed, and awarded the parents $54,714.40 as reimbursement for the room and board, comprehensive therapy services, nursing services, and neurological diagnostics. The district court also awarded Leah’s parents $36,768.20 in attorneys’ fees and costs. RISD now appeals.

II

We review de novo the district court’s decision that the local school’s IEP was inappropriate and that the alternative placement was appropriate under IDEA, as a mixed question of law and fact. See Teague Indep. Sch. Dist. v. Todd L., 999 F.2d 127, 131 (5th Cir.1993) (citing Christopher M. v. Corpus Christi Indep. Sch. Dist., 933 F.2d 1285, 1289 (5th Cir.1991)). The district court’s findings of “underlying fact” are reviewed for clear error. Id. Whether the child obtained any benefit from special education services is a finding of underlying fact. Id.

III

This appeal involves an interpretation and application of IDEA, 20 U.S.C. §§ 1400-1487.3 After the events in this case, Congress amended and reauthorized IDEA, see Individuals with Disabilities Education Improvement Act of 2004, Pub.L. 108-446, 118 Stat. 2647 (codified as amended at 20 U.S.C. §§ 1400-1482), and the Department of Education revised IDEA’S implementing regulations, see Assistance to States for the Education of Children With Disabilities and Preschool Grants for Children With Disabilities, 71 Fed.Reg. 46540 (Aug. 14, 2006) (codified as amended at 34 C.F.R. §§ 300 & 301). For the present case, we must look to the code and regulations as they existed at the time of the events of this case. See Alvin In*292dep. Sch. Dist. v. A.D. ex rel. Patricia F., 503 F.3d 378, 382 n. 4 (5th Cir.2007). That is, we must look to the 1997 version of IDEA (which was in effect through 2004) and its implementing regulations. See Individuals with Disabilities Education Act Amendments of 1997, Pub.L. 105-17, 111 Stat. 37 (codified at 20 U.S.C. §§ 1400-1487).

IDEA requires states to provide all children with a “free appropriate public education” in order to receive federal funding. 20 U.S.C. § 1412(a)(1)(A); Forest Grove Sch. Dist. v. T.A., — U.S.-, 129 S.Ct. 2484, 2487-88, 174 L.Ed.2d 168 (2009). To ensure that all children receive a meaningful opportunity to benefit from public education, the education of children with disabilities must be tailored to the unique needs of the handicapped child by means of an IEP. 20 U.S.C. § 1414(d). IDEA mandates that disabled children be educated among non-disabled children, to the fullest extent possible, in the least restrictive environment. See 20 U.S.C. § 1412(5); Bd. of Educ. v. Rowley, 458 U.S. 176, 202, 102 S.Ct. 3034, 73 L.Ed.2d 690 (1982). However, IDEA does not entitle a disabled child to a program that maximizes the child’s potential. See Cypress-Fairbanks Indep. Sch. Dist. v. Michael F., 118 F.3d 245, 247 (5th Cir.1997). Instead, IDEA guarantees a “basic floor” of opportunity, “specifically designed to meet the child’s unique needs, supported by services that will permit him to benefit from the instruction.” Id. at 247-48; see also Rowley, 458 U.S. at 200, 102 S.Ct. 3034. Still, the educational benefit “cannot be a mere modicum or de minimis; rather, an IEP must be likely to produce progress, not regression or trivial educational advancement.” Michael F., 118 F.3d at 248 (quotation marks and citation omitted).

Here, the hearing officer and district court found that RISD failed to provide Leah with a free appropriate public education. Specifically, they found that Leah’s parents had shown that the June 2004 IEP was inappropriate and that Leah’s placement at TNRC was appropriate. Consequently, both the hearing officer and district court determined that Leah’s parents were entitled to reimbursement from the District. RISD now challenges these decisions.4

A

Under IDEA, when a party aggrieved by an administrative decision brings a civil action, the district court may “grant such relief as [it] determines is appropriate.” 20 U.S.C. § 1415(i)(2)(B)(iii). The Supreme Court has interpreted the term “appropriate” to mean “ ‘appropriate’ in light of the purpose of the Act.” Sch. Comm. of Burlington v. Dep’t of Educ. of Mass., 471 U.S. 359, 369, 105 S.Ct. 1996, 85 L.Ed.2d 385 (1985). When parents unilaterally remove their child from a public school, reimbursement *293for the expenses of private schooling maybe an appropriate form of relief in some situations:

If the parents of a child with a disability, who previously received special education and related services under the authority of a public agency, enroll the child in a private elementary or secondary school without the consent of or referral by the public agency, a court or a hearing officer may require the agency to reimburse the parents for the cost of that enrollment if the court or hearing officer finds that the agency had not made a free appropriate public education available to the child in a timely manner prior to that enrollment.

20 U.S.C. § 1412(10)(C)(ii); see also Burlington, 471 U.S. at 369-71, 105 S.Ct. 1996; Michael F., 118 F.3d at 248. To receive reimbursement, a disabled child’s parents must prove that (1) an IEP calling for placement in a public school was inappropriate under IDEA, and (2) the private placement was proper under the Act. Michael F., 118 F.3d at 248 (citing Burlington, 471 U.S. at 370, 105 S.Ct. 1996); see also Florence County Sch. Dist. Four v. Carter By and Through Carter, 510 U.S. 7, 15, 114 S.Ct. 361, 126 L.Ed.2d 284 (1993). We will consider each of these issues in turn.

1

Our review of the adequacy of an IEP is limited to two questions: First, has the state complied -with the procedural requirements of IDEA? Rowley, 458 U.S. at 206, 102 S.Ct. 3034. Second, “is the [IEP] developed through the Act’s procedures reasonably calculated to enable the child to receive educational benefits?” Id. at 206-07, 102 S.Ct. 3034. Here, Leah’s parents have not challenged RISD’s procedural compliance with IDEA, so our inquiry focuses only on whether the June 2004 IEP was reasonably calculated to enable Leah to receive educational benefits.5

In Michael F., we articulated four factors relevant to the determination of whether an IEP is reasonably calculated to provide meaningful educational benefits under IDEA:

(1) the program is individualized on the basis of the student’s assessment and performance;

(2) the program is administered in the least restrictive environment;

(3) the services are provided in a coordinated and collaborative manner by the key “stakeholders”; and

(4) positive academic and non-academic benefits are demonstrated.

118 F.3d at 253. We have never specified precisely how these factors must be weighed. In practice, we have treated the Michael F. factors as indicators of when an IEP meets the requirements of IDEA, but we have not held that district courts are required to consider them or to weigh them in any particular way. See, e.g., Houston Indep. Sch. Dist. v. VP, 566 F.3d 459, 467 (5th Cir.2009); Adam J. v. Keller Indep. Sch. Dist., 328 F.3d 804, 810 (5th Cir.2003); Houston Indep. Sch. Dist. v. Bobby R., 200 F.3d 341, 347 (5th Cir.2000).

Here, the hearing officer and district court analyzed the June 2004 IEP under the Michael F. framework. However, the method by which the district court weighed the factors is somewhat unclear. The district court made no express findings regarding the first factor, but did acknowledge that the IEP addressed *294Leah’s specific behavioral difficulties and academic goals. Leah’s parents did not contest the second factor, so the district court did not address whether the IEP was administered in the least restrictive environment. The third factor was briefly-referenced, with the court stating that there was “reason to doubt” that Leah’s IEP was implemented in a truly collaborative fashion.

The district court appeared to afford dispositive weight to the fourth factor, namely whether Leah demonstrated positive academic and non-academic benefits. No direct evidence exists of Leah’s actual progress under the June 2004 IEP, since she was already at TNRC when it was created. Thus, the district court evaluated the fourth factor exclusively in terms of Leah’s progress under previous IEPs, which it found were “substantially similar to [the June 2004 IEP] with several exceptions.” The district court found that under the previous IEPs Leah had shown a “consistent pattern of regress,” and that “the evidence is quite sparse regarding meaningful progress either academically or non-academically for Leah during the 2003-2004 school year.” Overall, the district court’s conclusion that the June 2004 IEP was inadequate is based on its finding that RISD was consistently unable to resolve the primary causes of Leah’s academic failure — her refusal to remain in the classroom and her destructive conduct when she was there. Though acknowledging that the IEPs contained measures to address these issues, the district court found the measures insufficient to resolve the problem because they had repeatedly failed in the past. Accordingly, the district court concluded that the June 2004 IEP failed to provide a meaningful educational benefit to Leah because it was not reasonably calculated to prevent Leah from fleeing or likely to produce different results than previous IEPs.

Though the district court might have explained why it afforded more weight to the fourth Michael F. factor than the others, we cannot conclude that the district court legally erred in its application of the Michael F. test. As explained above, we have not held that district courts must apply the four factors in any particular way. Our cases state only that these factors are “indicators” of an IEP’s appropriateness, see, e.g., VP, 566 F.3d at 467; Adam J., 328 F.3d at 810; Bobby R., 200 F.3d at 347, intended to guide a district court in the fact-intensive inquiry of evaluating whether an IEP provided an educational benefit. Therefore, the district court did not legally err by affording more or less weight to particular Michael F. factors.

RISD argues that the district court erred by requiring it to show that Leah made actual educational progress in order to find that she was provided with a free appropriate public education. Undoubtedly, IDEA does not require a school district to maximize a disabled child’s potential. See Rowley, 458 U.S. at 198, 102 S.Ct. 3034. Rather, it requires “that the education to which access is provided be sufficient to confer some educational benefit upon the handicapped child.” Id. at 200, 102 S.Ct. 3034; see also Bobby R., 200 F.3d at 349-50. The district court, however, did not base its ruling on a failure to maximize Leah’s potential; it concluded that the June 2004 IEP was insufficient to confer any educational benefit upon Leah at all. This conclusion was not based exclusively on Leah’s failure to progress. Rather, it was the stark pattern of regression over a significant period of time under similar IEPs, combined with RISD’s documented inability to keep Leah in the classroom, that indicated that any IEP substantially similar to the previous ones was doomed to fail. Therefore, the district *295court did not commit legal error by viewing Leah’s history of regression as relevant to its determination that the June 2004 IEP was insufficient to provide any educational benefit.

Moreover, the district court did not err in its factual finding that Leah received minimal educational benefits in the 2003-2004 school year. A district court’s determination of whether a child received educational benefits is reviewed only for clear error. See Bobby R., 200 F.3d at 347. The record supports the district court’s conclusion that, absent a few isolated instances of arguable academic success, overall Leah failed to make meaningful academic progress in the 2003-2004 school year. Accordingly, we hold that the district court did not err in its finding that the June 2004 IEP calling for placement in a public school was inappropriate under IDEA.

2

The second showing that parents must make in order to receive reimbursement for the unilateral placement of their child in a private facility is that the private placement was proper under IDEA. See Carter, 510 U.S. at 15, 114 S.Ct. 361; Michael F., 118 F.3d at 248. The district court held that TNRC was a public/private “hybrid” facility that should be assessed under the Supreme Court’s framework in Florence County School District Four v. Carter By and Through Carter, and adopted the Third Circuit’s “inextricably intertwined” test in order to determine that Leah’s placement at TNRC was proper under IDEA. RISD argues that the district court erred by applying Carter, and that since Leah’s placement was improper under IDEA no reimbursement is warranted. As the foregoing analysis indicates, we conclude that the district court did not err by applying Carter, but we vacate and remand because the district court applied the incorrect test for determining when a private placement is proper under IDEA.

a

RISD argues that the district court erred by failing to determine whether Leah’s treatment at TNRC strictly complied with IDEA, instead determining that reimbursement was permitted if her treatment was “otherwise proper.” See Carter, 510 U.S. at 15, 114 S.Ct. 361. When parents unilaterally remove their child from public school and place them in a private facility, they do so at their own financial risk. See Burlington, 471 U.S. at 373-74, 105 S.Ct. 1996; Carter, 510 U.S. at 15, 114 S.Ct. 361. That is, the parents bear the risk that a hearing officer or court might later determine either that the child’s existing IEP was appropriate, or that the particular facility or program into which the parents placed their child was inappropriate; in either case, a school district need not pay for the residential placement. But when a parent unilaterally withdraws their child from public school and enrolls them in a private school, the parent is entitled to reimbursement if a hearing officer or court later determines that the private school education was “otherwise proper under IDEA,” even if it did not meet each specific IDEA requirement. See Carter, 510 U.S. at 9, 114 S.Ct. 361. In other words, parents are not barred from reimbursement because the private school did not meet the precise IDEA definition of a free appropriate public education, because IDEA requirements “cannot be read as applying to parental placements.” Id. at 13, 114 S.Ct. 361.

Under Carter, then, it is clear that if TNRC were simply a private school, reimbursement would be permitted if Leah’s education there was “otherwise proper” under IDEA. However, Carter does not directly answer the question pre*296sented here of whether a facility with both private and public components must meet all IDEA requirements in order for the district court to allow reimbursement. Attempting to resolve this issue, the district court held that a Leah’s placement at TNRC could be judged by the Carter standard. The district court determined that since Leah was enrolled at TNRC via unilateral parental placement after RISD failed to provide her with a free appropriate public education, Carter's pronouncement that IDEA “cannot be read as applying to parental placements” allowed reimbursement if her education was “otherwise proper” under IDEA.

We agree with the district court. Though the facts in Carter involved a private school, the holding was not contingent on the fact that the facility was purely private. Rather, the Court was clearly focused on maintaining the right established in Burlington: namely, that IDEA empowers a court “‘to order school authorities to reimburse parents for their expenditures on private special education for a child if the court ultimately determines that such placement, rather than a proposed IEP, is proper under the Act.’ ” Id. at 12, 114 S.Ct. 361 (quoting Burlington, 471 U.S. at 369, 105 S.Ct. 1996). Carter appreciated the situation facing a parent contemplating a unilateral withdrawal and placement after a public school proves incapable of educating their child. Such a parent faces the difficult choice of either “ ‘go[ing] along with the [school district’s] IEP to the detriment of their child if it turns out to be inappropriate or pay[ing] for what they consider to be the appropriate placement.’ ” Id. (quoting Burlington, 471 U.S. at 370, 105 S.Ct. 1996). For parents willing to risk the latter option, Congress authorized a court to award retroactive reimbursement for a program later found to be appropriate. Id. at 12, 15, 114 S.Ct. 361.

However, such parents “have no way of knowing at the time they select a private school whether the school meets state [or other relevant] standards.” Carter, 510 U.S. at 14, 114 S.Ct. 361. As the Carter Court noted, many IDEA requirements require cooperation and extensive involvement by the state educational agency,6 and “such cooperation is unlikely in cases where the school officials disagree with the need for the private placement.” Id. at 15, 114 S.Ct. 361. Thus, the Carter Court required only that a parental placement be “proper” for parents to receive reimbursement. Id. at 12-13, 114 S.Ct. 361. In essence, Carter found that it would eradicate the Burlington' right to unilateral withdrawal if reimbursement were only allowed when private facilities meet every IDEA requirement, particularly those requirements mandating state cooperation, when the entire reason for the withdrawal is the parents’ dissatisfaction with the state’s efforts to educate their child.

This logic extends to Leah’s placement at TNRC. Leah’s parents decided to re*297move her from public school and place her at TNRC at their own expense, after they determined that RISD was unable to provide her with a free appropriate public education. Under Burlington and Carter, they did so at their own financial risk. Id. at 15, 114 S.Ct. 361. Also as in Carter, Leah’s parents received no assistance from RISD in their effort to place Leah at a private facility, and they had no way of knowing whether TNRC met each procedural requirement mandated by IDEA. We therefore should not expect that Leah’s placement at TNRC would “be the exact proper placement required under the Act.” Alamo Heights Indep. Sch. Dist. v. State Bd. of Educ., 790 F.2d 1153, 1161 (5th Cir.1986).

RISD argues, however, that because UCS is a public charter school, Leah’s placement should be analyzed under the normal test for any public school, i.e., the four-factor Michael F. test. They assert that Carter dealt only with parental placements at private schools. This argument is unconvincing. As an initial matter, RISD’s argument assumes that under Carter, a unilateral parental placement at a public charter school would have to comply totally with IDEA in order for the court to allow reimbursement. Of course, Carter does not support this contention and would in fact never reach this question. The Carter rule only applies to situations where parents request reimbursement for the cost of their child’s education and related services, and no such costs would accrue if a parent simply moved their child to another public school. Further, RISD argues for a rule that would require Leah’s education at UCS to be evaluated separately from her treatment at TNRC (since it is clear under Carter that private facili