author: MIHM, District Judge.

text:
    Ronald J. NEMMERS and Sarah L. Nemmers, as parents and next friends of Eric P. Nemmers, Plaintiffs, v. UNITED STATES of America, Defendant.
    No. 82-1257.
    United States District Court, C.D. Illinois, Peoria Division.
    June 27, 1985.

      Edward R. Durree, Strodel, Kingery & Durree, Peoria, 111., for plaintiffs.
    Mark D. Stuaan, Asst. U.S. Atty., Peoria, 111., for defendant.
   MEMORANDUM OPINION

MIHM, District Judge.

The Court has determined that this action, filed by Ronald and Sarah Nemmers as parents and next friends of Eric Nemmers, seeking damages for alleged medical malpractice, is governed by the substantive law of the State of Maryland. The action is brought under the Federal Tort Claim Act which imposes a statutory time limit of two years after the accrual of the claim. 28 U.S.C. § 2401(b). Under Maryland law, the burden of proving, by a preponderance of the evidence, that the Defendant’s negligence was one direct and proximate cause of the injury suffered rests with the Plaintiffs.

FACTUAL BACKGROUND

Eric Nemmers was born on July 23, 1973 at the Hospital of the Naval Air Station, Patuxent River, Maryland. Sarah Nemmers learned of her pregnancy on November 13,1972 as a result of a pregnancy test performed in Madison, Wisconsin. Her husband, Ronald, had enlisted in the Navy and been sent to Orlando, Florida for boot camp. She, in the meantime, returned to Dubuque, Iowa, where she saw an obstetrician on December 22, 1972. He confirmed that she was pregnant and calculated an estimated due date of June 29, 1973, based on the first day of her last menstrual period. From February of 1973, when she moved with her husband to the Naval Air Station in Pensacola, Florida, to and through the time of her delivery, she sought and maintained regular obstetrical care from United States naval physicians. She was seen five times by physicians in Pensacola and, when Ronald Nemmers was transferred to Maryland, she began routine visits at the Naval Air Station, Patuxent River, Maryland.

Sarah Nemmers was 21 days beyond her estimated due date on July 20, 1973 when she was taken to the hospital with irregular pains and very light contractions. At that time, Dr. Hooper, one of her three treating physicians at Patuxent River, prescribed a suppository and sent her home, telling her to return when the pains were regular and five minutes apart. After experiencing more intense pain, beginning iii the wee hours of July 21, she contacted the hospital at approximately 10:00 a.m. and was again advised (this time by an obstetrical nurse) that she should not come in until the pains were five minutes apart. They continued with increasing intensity, causing her to again telephone the hospital at 7:00 p.m. An obstetrical nurse reiterated the instruction that she was not to come or call again until the pains were regular and five minutes apart. During the late night hours of July 21, Mrs. Nemmers, on three occasions, discharged a dark yellow, mucousy fluid which disclosed no blood when she inspected it. By the evening of July 22, pain and the insistence of her visiting inlaws compelled Sarah to return to the hospital, even though the pains were still not five minutes apart. She was admitted, in labor, on July 22 at 9:50 p.m. At that time, an examination by Dr. Stephen Hooper revealed that the cervix was 95% effaced, dilation was at four centimeters, and the fetal heart rate was 132.

In the early morning hours of July 23, the attendant obstetrical nurse had difficulty finding the baby’s heartbeat. Dr. Hooper ordered the use of a Doptone fetal heart tone amplifier, and subsequent monitoring over the next three and one-half hours showed an irregular beat, varying between 120 and 140. In the operating room this range dropped to 100/120. On two occasions prior to delivery, the heart rate declined to 80. Eric Nemmers was delivered by Caesarean section at 4:22 a.m. on July 23.

. Dr. Hooper’s “clinical record” discloses his belief that the baby was “probably post-mature.” This opinion was echoed by Drs. Burmeister, Rosenthal, and Socol, all experts who testified at trial.

Although Eric appeared at birth to be normal (his Apgar scores were five- at one minute and nine at five minutes) and both parents were told that they had a healthy baby boy, Mrs. Nemmers became concerned when Eric was about 12 months old because she felt he was not even ready to begin walking. When she expressed her concerns to the pediatrician at his one year check-up, she was told not to worry. At" that time the Nemmers were taking Eric to Bethesda for treatment of his crossed eyes and the pediatrician suggested that the eye problems might be a partial cause of his not walking. That pediatrician, Dr. Lute-hart, never did motor testing of Eric. Such testing was done when Eric was 18 months old, resulting in a preliminary diagnosis of either cerebral palsy or muscular dystrophy.

The final diagnosis of cerebral palsy was made by a neurologist, Dr. Loeschner, who came from Bethesda. He became Eric’s treating physician and, when questioned by Mr. and Mrs. Nemmers about the cause of Eric’s illness, he assured them that “these things just happen” and that “it’s an act of God and only God knows why.” At this time, no one ever indicated to the Nemmers that there might be any connection between the circumstances of the delivery and Eric’s cerebral palsy.

Following Ronald Nemmers’ discharge from the Navy in 1977, the Nemmers moved to Minnesota and, in 1977, took Eric to Dr. Steven Copps, a pediatrician at the Gunderson Clinic in LaCrosse, Wisconsin for evaluation and treatment. In his evaluative report of May, 1977, Dr. Copps indicated several possible causes of Eric’s condition, suggesting that a bout of influenza in the first trimester of the pregnancy was the most likely cause. Dr. Copps, in his report, did allude to something which he called the “trauma of birth.”

The Nemmers moved to Peoria and Eric began attending the Robert Jamieson school. In October of 1979, the Nemmers learned that Eric was not just “developmentally delayed,” or mildly retarded but, rather, that he suffered from severe retardation.

On August 26, 1981, Mrs. Nemmers read an article which appeared in the Peoria Journal Star. The article recounted a number of similarities between the little girl who was its subject and Eric, described a Caesarean section being delayed with resulting reduction of oxygen, and reported a large out of court settlement. Then on the next day, August 27, she and her husband read another article in the same newspaper. This time the report was of a case which was in no way similar to Eric’s, but it did indicate that the aggrieved parties were suing the Government. The Nemmers submit that it was the juxtaposition of these two articles which first alerted them to the possibility that there was a connection between Mrs. Nemmers’ difficult delivery and Eric’s subsequent problems. They promptly sought legal counsel and initiated this suit against the federal government.

FINDINGS OF FACT

Statute of Limitations

The Nemmers sought information about the cause of Eric’s cerebral palsy from Dr. Pretlow, a pediatrician at Patuxent River, and Dr. Loeschner, the neurologist from Bethesda Naval Hospital. They were assured that the causes were unknown and that it was just one of those things and only God knows the cause. Neither doctor at any time suggested a connection between the circumstances of delivery and Eric’s cerebral palsy, nor had any such causal relationship been suggested by any Navy personnel at the time of Mr. Nemmers’ discharge. Although the Nemmers had access to the medical records of both Mrs; Nemmers and Eric, they were effectively diverted from the import of those records by statements made to them by the doctors.

The Court is very concerned by the report of Dr. Copps and has studied it carefully. His evaluative letter/report to the Nemmers delineated a number of possible causes, but concluded that the actual cause was influenza suffered by Mrs. Nemmers in the first trimester. There was in the letter a reference to “the trauma of the birth” and “fetal distress,” but again, attention was diverted by his asserted belief that influenza was the cause. Clearly, the Nemmers could have challenged the statements with respect to the nature of the disease, but there was no reason to have done so. Their goal was the rehabilitation of their son, not the determination of the cause or the assessment of blame. The Court does not believe that it can reasonably be said that, at that time, they knew or should have known that fetal distress or Mrs. Nemmers’ difficult labor and delivery could have caused Eric’s condition. The Court accepts the testimony of Eric’s parents that they believed that “trauma of birth” meant that Erie “had a hard time being born,” not that he had developed an injury occasioned by lack of oxygen because of delay in the baby’s delivery.

It is plain from the testimony of both Mr. and Mrs. Nemmers that they did act quickly after the appearance of the two newspaper articles which alerted them to the possible connection between Mrs. Nemmers’ difficult delivery and Eric’s cerebral palsy and extreme retardation.

Standard of Care

Post-maturity is a red flag which signals, for the obstetrician, an increased vulnerability of the fetus to injury during labor and delivery. This increased risk is caused by a diminution of the ability of the placenta to provide oxygen and nourishment to the fetus and a probable decrease in the amniotic fluid, which normally acts as a buffer between the fetus and the muscle walls during intense labor and delivery. There are certain protective procedures which are triggered once the obstetrician is on notice that the patient might be post-mature. The experts presented by Plaintiffs were uniform in their assertion that, in 1973, an indication of post-maturity required the reasonably competent obstetrician to employ certain diagnostic techniques for monitoring the continued well-being of the fetus and the placenta. The testimony of Plaintiffs’ experts, reinforced by the Fourteenth Edition of Williams Obstetrics, 1971, which was the leading obstetrical authority in 1973, established the need for periodic measurements of the estriol in the mother’s urine and periodic amniocentesis to test for the presence of meconium in the amniotic fluid or for a drastic reduction in the fluid itself.

Defendant’s expert, Dr. Michael Socol, was not in practice in 1973; he was a medical student. The thrust of his testimony was the establishment of what was not the standard of care in 1973, but, despite specific questions from the Court, he never indicated what the standard of care at that time was.

The value of estriol testing is questioned today, but it is not clear, even at this time, whether it is totally without merit. More recent technological advances have proven to be more effective and, consequently, have preempted its use. But, Plaintiffs’ expert established that estriol testing and amniocentesis were elements of the standard of care in 1973 and, in the presence of suspected post-maturity, should have been done. The Court is persuaded, by a preponderance of the evidence, that estriol testing and amniocentesis were integral elements of the standard of care in the presence of possible post-maturity in 1973.

Post-Maturity

For purposes of the issues in this case, the Court here finds that Eric Nemmers was post-mature at the time of his birth. The record discloses some dispute about the accuracy of the estimated due date of June 28, 1973. However, none of Mrs. Nemmers’ treating physicians apparently doubted its accuracy enough to change that estimate. There is, of course, no way that a judge, who is not a doctor, can make a definitive finding of the correctness of the due date at any time—certainly not 12 years after the fact.

Nevertheless, Dr. Hooper reported, “at the time of delivery, there was virtually no amniotic fluid present. There was a thick, yellow meconium staining of the baby.” He then concluded “by color of meconium + oilgohydramnious probably post-mature.” Moreover, experts at trial, Dr. Burmeister, Dr. Rosenthal, and Defendant’s expert, Dr. Socol, all agreed that Eric was post-mature. The Court accepts that the weight of the medical testimony establishes that Eric was, in fact, post-mature.

Deviations From Standard of Care

The Court, however, does not feel that actual post-maturity is the real issue. The critical issue is whether the doctors should have been on notice that the fetus might be post-mature.

The Court finds that a clinical suspicion of post-maturity was mandated by the simple fact that Sarah Nemmers’ estimated due date was June 28 and she had passed the 42nd week of her pregnancy by July 14. As indicated earlier, whatever suspicions the obstetricians may have entertained about possible inaccuracy of the estimated due date were not sufficiently strong to lead them to change it. Therefore, the possibility of post-maturity, established by the calendar and by observed clinical indications of a loss of amniotic fluid, should have triggered periodic estriol testing and ammiocentesis, pursuant to the contemporary standard of care. These, however, were not done.

In addition, despite their awareness of the increased risk occasioned by the indicated post-maturity, Mrs. Nemmers’ obstetricians did not monitor her closely. On the contrary, when she reported contractions on July 20, Dr. Hooper gave her a suppository to stimulate uterine activity and sent her home. Her telephone calls to the hospital generated only the standard response that she should wait until the contractions were five minutes apart and regular. Her doctors were in no position to, and consequently did not, observe the thick yellow discharges which she experienced.

The Court finds that, in the presence of several indicators of post-maturity and potential injury to the fetus resulting therefrom, Mrs. Nemmers’ obstetricians deviated from the standard of care.

Furthermore, given the extensive meconium staining of the infant at birth and the absence of amniotic fluid, the Court believes it is probable, perhaps likely, that estriol testing and amniocentesis would have demonstrated a degree of fetal distress on July 20 which would have indicated the advisability of an immediate Caesarean section. This necessarily results in a finding that Mrs. Nemmers’ labor continued for three days after delivery should have been completed for the safety of the infant.

Dr. Hooper indicated his belief that estriol testing would have been ineffective in this case because Patuxent River Hospital had no facilities for it, his specimens would have had to be sent to Bethesda Naval Hospital, and he would not have received timely results. The Court believes that, because such tests were part of the standard of care, any delivery unit would, of necessity, have had to have equipment and space for such testing and evaluation. A failure to provide adequate medical facilities is a deviation, on the part of the United States, from the contemporaneous standard of care.

Causation

Defendant, United States, has suggested, as possible causes of Eric’s injuries, influenza sustained by Mrs. Nemmers in the first trimester of her pregnancy or the normal trauma of birth. If the Court chose to speculate, the arguments presented by Defendant could be persuasive. But, the Court is duty bound to decide the issues based on the record in this case. The preponderance of evidence is that this was a post-mature pregnancy, that tests should have been done that were not done, that insufficient amniotic fluid was present, that there was fetal distress to the extent that the fetus became meconium stained. The preponderance of the expert medical evidence presented indicates that a Caesarean section should have been performed no later than July 20.

Defendant’s expert, Dr. Socol, did not substantially address this issue. Nor did Defendant tender other substantial testimony with respect to causation. The Court is aware of the fact that the burden of proof rests on the Plaintiff, not the Defendant; but where Plaintiff has presented adequate evidence of causation and expert testimony which is essentially unrefuted, the Court finds it difficult not to accept Plaintiffs’ experts’ assessment of proximate cause. Therefore, the Court finds that the record of the Plaintiffs creates, by preponderance of the evidence, a showing of proximate causation which is basically unrefuted.

This is a medical malpractice case. In the context of this action, as in any other, the probabilities and justifiable inferences are primarily established through expert testimony. In this case, the medical experts have convinced the Court of the correctness of their opinion that Eric’s cerebral palsy, severe mental retardation, and attendant physical infirmities were caused by hypoxic injuries resulting from insufficient oxygen, nourishment, and amniotic cushioning during labor and delivery.

CONCLUSIONS OF LAW

Statute of Limitations

The Court is of the opinion that this case represents a classic example of why statutes of limitations exist. The incident complained of took place 12 years ago and the Defendant doctors have no independent memory of any of the critical events. This, theoretically, could be the ease even if the incident had happened only a year ago, but clearly the duration of the interval has considerable impact on the ability to defend one’s self effectively against recent allegations of past wrongdoing. Such delay creates a distinct disadvantage, and the Court sincerely sympathizes with Defendant’s difficulty. However, the test for determining when the statute of limitations begins to run is focused on Plaintiffs and on that time when they reasonably knew or should have known of the existence of a cause of action. The Court believes, without repeating the sequence of events as set out in the findings of fact, that a careful consideration of the totality of the circumstances compels a finding that the Nemmers first realized there was a possible connection between Eric’s cerebral palsy and the circumstances attendant his delivery on August 26, 1981. The Court is convinced that, by the time the Nemmers received the letter from Dr. Copps, they had moved beyond the stage of seeking causes and assessing blame and were primarily concerned with effecting whatever improvements they could in Eric’s condition and preparing him to live a life as close to normal as possible. Therefore, their attitude, coupled with Dr. Copps’ diversion of their attention to the alleged influenza and its possible impact, as well as their understandable failure to understand the significance of the term “trauma of birth,” rendered the substance of Dr. Copps’ report insufficient to create the type of notice which would trigger the running of the statute of limitations.

Deviations from the Standard of Care

As indicated earlier, the Court has found that the preponderance of the evidence in this case has established that Defendant, through its physicians, nurses, and medical facility, failed to provide Sarah Nemmers with that reasonably competent obstetrical care which was required, in the circumstances, by the standard of care in 1973. In addition, the Plaintiffs have established, by a preponderance of the evidence, that if Defendant had acted in accord with the contemporary standard of care, the findings resulting from the requisite testing would have advised the Defendant doctors of the urgency of performing a timely Caesarean section. The Court, therefore, finds that the failure to deliver Eric Nemmers by Caesarean section on July 20, 1973 constituted negligence.

Proximate Causation

The Court has already in the findings of fact detailed with care its findings relating to the proximate cause of Eric’s injuries and disabilities. The Court now holds that it has been established, by a preponderance of the evidence, that Defendant’s negligent failure to adhere to the existing standard of care was the cause of Eric Nemmers’ cerebral palsy, severe retardation, and physical disabilities attendant thereto.

Damages

At trial, the wages lost to Eric Nemmers because of his physical and mental disabilities were shown and discounted to present cash value by Plaintiffs’ expert, Dr. Edward Sattler, an economist from Bradley University. Dr. Sattler made the following assumptions about Eric Nemmers:

* that he had a normal life expectancy of 59 years from the date of trial;
* that he had a normal work life of 38 years;
* that he would begin to work in 1991 as a 19-year-old high school graduate;
* that he would command a starting salary of $13,600 and could expect a 2.2% annual salary increase.

He further assumed a “real interest” or actual discount rate of 4% based on a long term annual interest rate of 11.5% offset by a long term inflation rate of 7.5%.

Based on these assumptions, Dr. Sattler projected a present cash value of Eric Nemmers’ lost wages of $661,813.15. Plaintiffs proposed a modification of that projection to reflect tax considerations which would result in an increased amount of $900,-683.37.

The Court considers this proposal in light of the law of Maryland which applies to both liability and damages under the Federal Tort Claims Act. The rule in Maryland on this issue is that “income taxes are not to be considered in any way, either to reduce or increase the award.” Cincotta v. United States, 362 F.Supp. 386, 408 (D.C.Md.1973). See also Plant v. Simmons, Co., 321 F.Supp. 735, 739-40 (D.C.Md.1970) and Jennings v. United States, 178 F.Supp. 516, 532 (D.C.Md.1959), rev’d on other grounds, 291 F.2d 880 (4th Cir.1961), decision after remand. affirmed 318 F.2d 718 (4th Cir.1963). This would appear to preclude both reduction of the award by the amount of income taxes which would have been payable by Eric Nemmers as well as the increase sought by Plaintiffs to offset taxes on possible potential investment income.

The Court notes that jurors are enjoined from speculation in the award of compensatory damages. That injunction is no less appropriate for the judge ruling from the bench. This Court believes it would be improperly speculative to award an offset for tax liability which may never materialize. This position finds emphatic reinforcement in Flannery for Flannery v. United States, 718 F.2d 108 (4th Cir.1983) in which the Court held:

“The plaintiff contends that if an adjustment is made for income taxes upon estimated future earnings, an adjustment should be made for the income taxes payable on income on invested funds after the judgment is paid. We reject the contention, for it is unknown how the fiduciary who will handle the funds will invest them. It could invest them in whole or in part in tax exempt securities. We find no basis for an adjustment for a tax liability which is avoidable and may never be incurred.” 718 F.2d at 112.

Therefore, the proper award is $661,813.15 without any modification to reflect tax considerations.

The Court now turns to the task of assessing damages to provide for Eric Nemmers’ future care and maintenance. Plaintiffs’ expert, Dr. Terry V. Carle, a specialist in physical medicine and rehabilitation, recommended a surrogate family approach to be used in providing such care. In addition to best meeting Eric's needs, in Dr. Carle’s opinion, such a program has the advantages of an annual cost which is substantially less than that incurred for the more traditional alternatives of resident schools, ranches, farms and other live-in facilities. The Court accepts that recommendation and adopts the surrogate program approach.

Dr. Carle projected an estimated annual cost of $57,100. This figure includes:

$36,000 Two full-time, live-in health care providers who would be surrogates for his parents.
3,600 Their food costs.
10,000 A manager, in the nature of a Guardian ad litem, to maintain the efficient operation of the program.
4.500 Annual vehicle expense.
2.500 Annual residence upkeep and taxes.
500 Annual health care costs (does not include routine health care).
$57,100

The Court believes that, inasmuch as annual vehicle and household maintenance normally come from income, there would be, in effect, a double award if these items were to be included within the surrogate program costs. Accordingly, the recommended figure will be reduced by $7,000 to a total of $50,100. For basically the same reason, the Court declines to factor in the tax considerations.

The total amount which should be needed to care for and maintain the health of Eric Nemmers for the balance of his life is $50,100 for 59 years or $2,955,900.

Plaintiffs have sought to include in the award to Eric Nemmers the reasonable cost of a house. The Court declines to do this. As with the vehicle and household maintenance above, living facilities themselves are generally purchased or leased from employment income. There appears to be no adequate reason to depart from this practice here. Through this final order, the Court intends to provide for Eric’s reasonable needs without generating a windfall for his family. If the parties had been amenable to a reversionary trust, the Court would have been less conservative in estimating the base value of Eric’s future needs. But Ronald and Sarah Nemmers were not Plaintiffs in their own rights nor have they demonstrated compensable injury caused them by Defendant’s negligence. The Court is not prepared, therefore, to make them an award except to the extent they are benefitted by relief from the financial burden of caring for their son in the future.

Plaintiffs have submitted alternative computations. One separates the salaries for surrogate personnel and applies a 2.2% annual real salary growth factor while maintaining the balance of the annual award at a fixed figure. This would result in an award of $1,804,989.75. The Court has chosen the second formulation. Using the same formula as above for reducing this award to present cash value and electing not to factor in the 2.2% annual real salary growth for the surrogate personnel, the Court hereby awards Eric Nemmers funds for his future care and maintenance in the amount of $1,173,729.15.

The Court declines to award compensation for “quality of life” considerations.

Judgment is hereby entered for the benefit of Eric Nemmers in the amount of:

$ 661,813.15 Present cash value of lost wages.
1,173,729.15 Present cash value of future care costs.
$1,835,542.30

      . It should be noted that the position of the Maryland courts does not preclude application of the exception noted by the Second Circuit Court of Appeals in McWeeney v. New York, N.H. & H.R.R., 282 F.2d 34, 35-59 (2nd Cir.1960). See Cincotta v. United States, supra at 408 and Plant v. Simmons, supra, at 739-40. This exception, which permits deduction of income tax on future wages when the plaintiff or plaintiff’s decedent has “great earning power," is not applicable, in the Court’s opinion, to this case.


source: Caselaw Access Project

author: SWEET, District Judge.

license: Public Domain

text:
    MARTIN E. SEGAL COMPANY, Plaintiff, v. John W. BARTON, Defendant.
    No. 84 Civ. 9259 (RWS).
    United States District Court, S.D. New York.
    June 27, 1985.

      Simpson Thacher & Bartlett, New York City, for plaintiff; Barry R. Ostrager, New York City, of counsel.
    Willkie Farr & Gallagher, New York City, for defendant; Lawrence 0. Kamin, Arthur S. Gabinet, New York City, of counsel.
   OPINION

SWEET, District Judge.

Defendant John Barton (“Barton”) has moved to dismiss this diversity-based action pursuant to Fed.R.Civ.P. 12(b)(2) for lack of personal jurisdiction. Plaintiff Martin E. Segal Co. (“Segal”) alleges that Barton has sufficient contacts with New York to support jurisdiction pursuant to CPLR § 302(a)(1). The motion to dismiss is granted.

Facts

For the purposes of this motion, the facts will be accepted as alleged by Segal. See Hoffritz For Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55 (2d Cir.1985). This case arises from Barton’s former employment with Se-gal and allegations that Barton has breached certain provisions of a non-competition agreement by continuing to render consulting and actuarial services to Segal’s clients through Barton’s current employer.

Segal is a national firm which has its headquarters in New York City. Barton is a citizen and resident of California. In 1974 Barton was hired by Segal as a corporate division representative for the Western region, working in Segal’s San Francisco office. During the ten years Barton worked for Segal, he was stationed in California, and he worked with clients based exclusively in California, Washington, or other Western states. On January 1, 1978, while in California, Barton executed a non-competition agreement with Segal.

During his employment with Segal, Barton consulted with corporate officials in New York, and Barton made several trips to New York at company expense. Segal characterizes these trips as frequent; Barton limits their number. Two such trips were for company-wide meetings of all Se-gal executives. During other trips, meetings focused on client development, and, at least once, Barton discussed projects and presentations for California clients.

Barton’s paychecks and reimbursements for expenses were paid by checks drawn on a New York account. Barton, however, neither owns nor rents real estate in New York; he has no bank accounts in New York; and he does not maintain an office, home or telephone in New York.

In July 1984 Barton left Segal and was employed by Mercer-Meidinger Corp. in San Francisco. In working for Mercer, Barton has worked exclusively for California clients and has had no contact with New York.

Discussion

Personal jurisdiction in a diversity action is determined by the law of the jurisdiction in which the court sits. United States v. First National City Bank, 379 U.S. 378, 381-82, 85 S.Ct. 528, 530, 13 L.Ed.2d 365 (1965). The burden of establishing jurisdiction over a defendant rests on the plaintiff, and in the absence of an evidentiary hearing; the plaintiff need make only a prima facie showing that jurisdiction exists. Hoffritz For Cutlery, supra; Beacon Enterprises, Inc. v. Menzies, 715 F.2d 757 (2d Cir.1983).

Segal asserts jurisdiction under CPLR § 302(a)(1), which states:

As to a cause of action arising from any of the acts enumerated in this section, a court may exercise personal jurisdiction over any nondomiciliary, or his executor or administrator, who in person or through an agent:
1. transacts any business within the state or contracts anywhere to supply goods or services in the state ...

When jurisdiction is based upon § 302(a)(1), the cause of action sued upon must arise from the transaction of business within the state. McGowan v. Smith, 52 N.Y.2d 268, 437 N.Y.S.2d 643, 419 N.E.2d 321 (Ct.App.1981) (requiring an articulable nexus between the business transacted and the cause of action sued upon). In Faherty v. Fender, 572 F.Supp. 142 (S.D.N.Y.1983) the Court held:

A defendant is subject to jurisdiction in New York if he transacts business within the state and there is a “substantial relationship” between this transaction of business and plaintiff’s causes of action. This “substantial relationship” test is not satisfied by a remote causal connection between defendant’s forum activity and plaintiff’s claim, (citations omitted)

In Pavlo v. James, 437 F.Supp. 125 (S.D. N.Y.1977) the plaintiff attempted to assert jurisdiction pursuant to CPLR § 302(a)(1) to recover for alleged breaches of a non-competition agreement. Plaintiff alleged that the non-resident defendant employee while in the employ of plaintiff had established competing corporations in Kentucky and Indiana. Although the plaintiff alleged that the employee frequently visited New York on business, the Court declined to exercise jurisdiction, holding that the absence of a specific linkage between the New York activities and the cause of action made jurisdiction improper.

Similar reasoning compels a finding in this action that jurisdiction based on CPLR § 302(a)(1) would be improper. There is no meaningful dispute about the extent of Barton’s New York contacts. However, Segal has not established, or even alleged, that the visits to New York or the business conducted during those visits is related in a substantial or proximate manner to the alleged violations of the non-competition agreement. Although Segal claims that Barton “performed in New York numerous purposeful acts in relation to his employment,” Segal does not allege that these acts were substantially or proximately connected to the alleged breach. No allegation or showing is made that the Segal clients for whom Barton now provides services were in any manner connected with Barton’S'New York contacts. Nor is there an allegation that any confidential information which Barton has used improperly was obtained during his New York visits.

In Hoffritz, supra, the Court stated that to establish jurisdiction under 302(a)(1) it was necessary to show “that the cause of action is sufficiently related to the business transacted [in New York] that it would not be unfair to deem it to arise out of the transacted business ...” Id. at 59. Segal has alleged only a connection between business transacted in New York and the employment contract generally. No allegation is made with respect to a nexus between the business transacted in New York and the specific breaches alleged in the complaint.

Conclusion

Segal has failed to allege a prima facie case that would establish proper jurisdiction under CPLR § 302(a)(1). The clerk is directed to enter judgment dismissing the case.

IT IS SO ORDERED.


text:
    Patrick SANTOLI, Plaintiff, v. CITY OF NEW YORK, Edward I. Koch, as Mayor of the City of New York, the New York City Police Department, and Benjamin Ward, as Police Commissioner of the New York City Police Department, Defendants.
    No. 84 Civ. 6908 (RWS).
    United States District Court, S.D. New York.
    June 27, 1985.
    Richard Hartman, Little Neck, N.Y., for plaintiff; Raymond E. Kerno, Gerard T. Breen, Little Neck, N.Y., of counsel.
    Frederick A.O. Schwarz, Jr., Corp. Counsel, New York City, for defendants; Beth Schwartz, Elizabeth Dale Kendrick, New York City, of counsel.
   OPINION

SWEET, District Judge.

The defendants City of New York, Edward I. Koch, as Mayor of the City of New York, the New York City Police Department, and Benjamin Ward, as Police Commissioner of the New York City Police Department (collectively the “City”) have moved under Fed.R.Civ.P. 12(b)(1) and (6) for judgment dismissing the complaint of plaintiff Patrick Santoli (“Santoli”) brought under 42 U.S.C. § 1983 seeking a declaration that the termination and later denial of his reinstatement as a New York City Police Department detective is unconstitutional. Greene v. McGuire, 683 F.2d 32 (2d Cir.1982), requires the City’s motion be granted, and judgment will be entered dismissing the complaint.

Santoli was appointed as a probationary police officer, New York City Police Department, on June 30, 1969 and in November, 1969 Santoli was assigned as a patrolman to the 13th Precinct in Manhattan and then in November, 1971 to the Auto Crime Unit. In November, 1973 he was promoted to the rank of detective, New York City Police Department. Thereafter Santoli was decorated with three meritorious awards and approximately 12 excellent police duty awards.

However, in 1978 Santoli was indicted for criminal possession of stolen property, namely, a single object, a telephone interception detective device, known as an “0-Light.” The officers of VGS Services, a personal property and baggage delivery company, located near John F. Kennedy International Airport, were also indicted. According to Santoli, his only connection with VGS was that of an occasional deliverer of baggage, at most once or twice a week, performed while on his way home. The defendants, other than Santoli and one other, pleaded guilty.

Although Santoli was named in an indictment involving only the O-Light, that indictment was consolidated with the indictment against the officer of VGS. At the trial the only direct evidence introduced against Santoli was his statement to an undercover detective that the telephone interception detection device was “traceable.” Santoli was convicted.

The Supreme Court, Appellate Division, Second Department, on appeal held that Santoli’s utterance of the word “traceable” could not be found as a matter of law to have the meaning ascribed to it by the undercover officer and that reliance upon the undercover officer’s interpretation of the word “traceable” to mean criminal activity on Santoli’s part was not supported by the evidence adduced at the trial. The conviction was reversed. People v. Santoli, 81 A.D.2d 842, 438 N.Y.S.2d 847 (2d Dept.1981).

When Santoli was convicted, he was dismissed from the New York City Police Department by operation of law, Public Officers Law § 30(l)(e), and his position deemed vacated. When the conviction was reversed, Santoli sought reinstatement to the New York City Police Department, by written application, dated September 18, 1981. On September 3, 1982 the Hearing Officer recommended that Santoli not be reinstated to the Police Department and that he receive no hearing in connection thereto. The Police Commissioner adopted the recommendation on September 17, 1982.

On December 1,1982, Santoli initiated an Article 78 proceeding contending that the respondents’ refusal to reinstate him or, in the alternative, to grant him a departmental hearing upon the charges and specifications was illegal, contrary to law, arbitrary and capricious. On March 21, 1983, the petition for a judgment pursuant to Article 78 was denied, and the denial was affirmed unanimously and without written opinion on March 15, 1984, Matter of Santoli v. McGuire, 99 A.D.2d 987, 472 N.Y.S.2d 866 (1st Dept.1984). Thereafter, application for leave to appeal to the New York State Court of Appeals was denied. Matter of Santoli v. McGuire, 62 N.Y.2d 604, 478 N.Y.S.2d 1023, 467 N.E.2d 532 (1984).

The City relies on res judicata grounds, recognizing however, that the constitutional ground here asserted was not raised in the state court Article 78 proceeding. Indeed, Santoli points out authority for the proposition that the constitutionality of the Public Officer Law could not have been raised in his state court proceeding. Because Greene v. McGuire, supra, is controlling, the issue of the interrelationship of an Article 78 proceeding and a § 1983 action need not be resolved.

Greene is indistinguishable from the case at hand. There as here the criminal conviction of a police officer triggered dismissal under Public Officers Law § 30(l)(e). The conviction was later reversed. Notwithstanding, the Court of Appeals reversed the lower court which had held that some process was required before dismissal. It was concluded that Greene’s property interest was extinguished by his conviction by operation of the state statute.

Santoli sought upon argument to distinguish Greene by virtue of the nature of the reversal, terming Greene’s reversal to have been based on technical grounds and Santoli’s on the merits. It was urged that Santoli’s reversal amounted to a verdict of innocent. Santoli also urges that our Court of Appeals misread Toro v. Malcolm, 44 N.Y.2d 146, 375 N.E.2d 739, 404 N.Y.S.2d 558 (1978) upon which its reasoning was based.

Despite Santoli’s argument, I cannot convert the reversal of his conviction into a finding of innocence, and even if I could, Greene’s reasoning would still in my view be applicable. If it is felt, as expressed in the concurrence in Greene that the New York law may be over-rigid, any change cannot be achieved in this court under the existing authorities.

The motion is granted and judgment will be entered dismissing the complaint.

IT IS SO ORDERED.


author: SESSIONS, Chief Judge.

text:
    In re CLASS ACTION APPLICATION FOR HABEAS CORPUS ON BEHALF OF ALL MATERIAL WITNESSES IN the WESTERN DISTRICT OF TEXAS. In re APPLICATION FOR HABEAS CORPUS on Behalf of Pablo Abalos MARQUEZ, Rito Estrada Netro, Jose Maldonado Diaz, held as Material Witnesses in: UNITED STATES of America v. Ernest MAHARD, Jr., Helen Mahard, Doing Business as Mahard Egg Company, Inc. Pablo Abalos MARQUEZ, Rito Estrada Netro, and Jose Maldonado Diaz, Individually and on Behalf of classes which they represent v. William French SMITH, Helen Eversberg, William Jonas and James M. Banks, Individually, and in their official capacity and on Behalf of a class of Defendants which they represent.
    Nos. DR-83-CA-46, DR-83-CR-48.
    United States District Court, W.D. Texas, Del Rio Division.
    June 28, 1985.

      George Korbel, Texas Rural Legal Aid, San Antonio, Tex., for petitioners.
    Raymond Nowak, Asst. U.S. Atty., San Antonio, Tex., for respondents.
   ORDER

SESSIONS, Chief Judge.

ON THIS DATE came on to be considered the Petitioners’ motion for partial summary judgment.

This case has a long history that is ably summarized by both the Petitioners’ and Respondents’ briefs filed in relation to this motion. The individuals involved in this cause are those persons in the Western District of Texas who are being held as material witnesses pursuant to Title 18, United States Code, Section 3144. The central issue in this case involves whether indigent individuals are entitled to representation by counsel at the time that the determination to hold them as material witnesses is made and during the time of their incarceration. It appears to this Court that formal criminal charges are rarely filed against persons held as material witnesses and therefore the right to counsel as provided by the Sixth Amendment to the United States Constitution seldom arises.

The Petitioners contend that the statutory scheme created by Title 18, United States Code, Sections 3144 and 3142 requires the appointment of counsel to represent indigent persons held as material witnesses. It also appears that the Petitioners claim that there is a constitutional right to representation by counsel where an individual faces incarceration as a material witness.

The Respondents appear to concede that the provisions of 18 U.S.C. §§ 3144 and 3142 provide for appointment of counsel for persons arrested as material witnesses. See Respondents’ Supplemental Reply Brief filed May 20, 1985. The Respondents, however, remain steadfast in their contention that they are unable to provide the relief sought by the Petitioners. The Respondents base this argument upon their belief that it is the Court who appoints counsel to represent indigent individuals, not the Government. Thus, while the Respondents may agree that material witnesses are entitled to representation, they do not believe that they are the proper parties to provide the relief sought, and thus argue that they are not proper parties to this suit insofar as the suit relates to representation of material witnesses.

This Court has reviewed the submissions of both parties and agrees with the Petitioners that material witnesses are entitled to representation. The Court also agrees with the Respondents that the Court, not the Respondents, is the appropriate body to afford the relief sought by the Petitioners. Nevertheless, this Court believes that the issue of representation of material witnesses must be addressed and further believes that it is appropriate to do so in this cause. Consequently, this Court will grant, in part, the Petitioners’ motion for partial summary judgment and will require the Judges of the Western District of Texas to take immediate steps to provide representation for persons that the Government seeks to hold as material witnesses in the future.

Section 3144 was added to Title 18 by the Comprehensive Crime Control Act of 1984, Pub.L. 98-473, 98 Stat. 1982 (1984). Section 3144 provides that:

If it appears from an affidavit filed by a party that the testimony of a person is material in a criminal proceeding, and if it is shown that it may become impracticable to secure the presence of the person by subpena, a judicial officer may order the arrest of the person and treat the person in accordance with the provisions of section 3142. No material witness may be detained because of inability to comply with any condition of release if the testimony of such witness can adequately be secured by deposition, and if further detention is not necessary to prevent a failure of justice. Release of a material witness may be delayed for a reasonable period of time until the deposition of the witness can be taken pursuant to the Federal Rules of Criminal Procedure.

Section 3144 changed the law as it applied to material witnesses in two ways. First, Section 3144 unambiguously provides that material witnesses are to be treated in accordance with Title 18, United States Code, Section 3142 which addresses the release of defendants prior to trial. Comprehensive Crime Control Act of 1984, Pub.L. No. 98-473, 1984 U.S.CODE CONG. & AD. NEWS (98 Stat.) 3182, 3211-3212. Second, Section 3144 explicitly grants authority to a judicial officer to order the arrest of a person as a material witness. Id.

Title 18, United States Code, Section 3142 was also amended by the Comprehensive Crime Control Act of 1984. Section 3142 provides for the release or detention of a defendant pending trial. If a judicial officer determines that a defendant should not be released on his own recognizance or on an unsecured appearance bond, a hearing must be held to determine whether any condition or combination of conditions can be imposed upon the defendant that will reasonably assure his appearance at trial and the safety of any other person and the community. 18 U.S.C. § 3142(a), (b), (c) & (f). The judicial officer is required to hold a hearing immediately upon an individual’s first appearance before him.

The hearing shall be held immediately upon the person’s first appearance before the judicial officer unless that person, or the attorney for the Government, seeks a continuance____ At the hearing, the person has the right to be represented by counsel, and, if he is financially unable to obtain adequate representation, to have counsel appointed for him____

18 U.S.C. § 3142(f) (emphasis added).

It is clear that Section 3142(f) contemplates the appointment of counsel for defendants that are financially unable to secure representation.

The procedural requirements for the pretrial detention hearing set forth in section 3142(f) are based on those of the District of Columbia statute which were held to meet constitutional due process requirements in United States v. Edwards. The person has a right to counsel, and to the appointment of counsel if he is financially unable to secure adequate representation.

Comprehensive Crime Control Act of 1984, Pub.L. 98-473, 1984 U.S.CODE CONG. & AD .NEWS (98 Stat.) 3205. A reading of Section 3144 and its legislative history shows that Congress intended the provisions of Section 3142(f) to apply in cases where an individual is sought to be incarcerated as a material witness. Thus, this Court believes that where an individual is arrested and the government seeks to detain him as a material witness pursuant to Section 3144, and a judicial officer determines that the individual should not be released on his own recognizance or on an unsecured appearance bond, an attorney must be appointed to represent the individual if he is financially unable to obtain representation.

This Court’s conclusion that material witnesses are entitled to representation is made obvious by a careful reading of the statutory scheme set forth by Sections 3144 and 3142. The Court’s interpretation of Sections 3142 and 3144 is supported by recent amendments to the guidelines for the administration of the Criminal Justice Act approved by the United States Judicial Conference at its March 1985 proceedings. The Judicial Conference inserted a new paragraph 2.15 in its guidelines entitled Representation of a Material Witness. The paragraph provides in part that:

While subsection (g) of the CJA provides for the discretionary appointment of counsel for a person in custody as a material witness “when the interests of justice so require,” the Bail Reform Act of 1984 requires that counsel be appointed to provide representation at a detention hearing for a person who has been arrested as a material witness.

Vol. VII, Guide to Judiciary Policies and Procedures, Section A, Chapter 2, paragraph 2.15 (emphasis in original).

It is this Court’s opinion that existing statutory law requires the appointment of counsel to represent persons detained as material witnesses who are financially unable to afford representation. In addition, this Court is of the opinion that appointment of counsel to represent material witnesses is required by the Fifth Amendment to the Constitution.

The Fifth Amendment provides in pertinent part that: “[n]o person shall ... be deprived of life, liberty, or property, without due process of law____” It has long been held that aliens, even those who are in this country unlawfully, are “persons” guaranteed due process of law by the Fifth Amendment. Plyler v. Doe, 457 U.S. 202, 210, 102 S.Ct. 2382, 2391, 72 L.Ed.2d 786 (1982); Galvan v. Press, 347 U.S. 522, 530, 74 S.Ct. 737, 742, 98 L.Ed. 911 (1954); Shaughnessy v. United States, 345 U.S. 206, 212, 73 S.Ct. 625, 629, 97 L.Ed. 956 (1953); Wong Wing v. United States, 163 U.S. 228, 238, 16 S.Ct. 977, 981, 41 L.Ed. 140 (1896); Yick Wo v. Hopkins, 118 U.S. 356, 369, 6 S.Ct. 1064, 1070, 30 L.Ed. 220 (1886). Thus, the Fifth Amendment protects aliens who are in this country unlawfully from invidious discrimination by the federal Government. Plyler v. Doe, 457 U.S. at 210, 102 S.Ct. at 2391; Matthews v. Diaz, 426 U.S. 67, 77, 96 S.Ct. 1883, 1890 (1976). The Fifth Amendment also protects illegal aliens from deprivations of liberty without due process of law.

It is clear that “commitment for any purpose constitutes a significant deprivation of liberty that requires due process protection.” Addington v. Texas, 441 U.S. 418, 425, 99 S.Ct. 1804, 1809, 60 L.Ed.2d 323 (1979); see also Jones v. United States, 463 U.S. 354, 361, 103 S.Ct. 3043, 3048, 77 L.Ed.2d 694 (1983). The “right to be heard before being condemned to suffer grievous loss of any kind, even though it may not involve the stigma and hardships of a criminal conviction, is a principle basic to our society.” Joint Anti-Fascist Refugee Committee v. McGrath, 341 U.S. 123, 168, 71 S.Ct. 624, 646-47, 95 L.Ed. 817 (1951) (Frankfurter, J., concurring). What process is constitutionally due, however, is another matter.

The fundamental requirement of due process is an opportunity to be heard. Parratt v. Taylor, 451 U.S. 527, 540, 101 S.Ct. 1908, 1915, 68 L.Ed.2d 420 (1981). In this regard, the opportunity to be heard must be given at a meaningful time and in a meaningful manner. Id.; Armstrong v. Manzo, 380 U.S. 545, 552, 85 S.Ct. 1187, 1191, 14 L.Ed.2d 62 (1965). The requirements imposed by the due process clause of the Fifth Amendment, however, are flexible and vary depending upon the particular situation presented. Matthews v. Eldridge, 424 U.S. 319, 334, 96 S.Ct. 893, 902, 47 L.Ed.2d 18 (1976); see Hewitt v. Helms, 459 U.S. 460, 103 S.Ct. 864, 872, 74 L.Ed.2d 675 (1983) (in context of Fourteenth Amendment Due Process Clause). The Court must consider three factors to determine what process is constitutionally due:

First, the private interests that will be affected by the official action; second, the risk of an erroneous deprivation of such interests through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the government’s interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.

Matthews v. Eldridge, 424 U.S. at 335, 96 S.Ct. at 903; see also Hewitt v. Helms, 459 U.S. at 472, 103 S.Ct. at 872.

The private interests at stake where material witnesses are concerned strike at the very heart of the values sought to be protected by our Constitution—liberty. The vast majority of persons held as material witnesses in the Western District of Texas are not innocent. In most cases, the persons are held in connection with cases involving the illegal transportation of aliens. Usually individuals held as material witnesses were brought to this country unlawfully. Thus, in this District, persons held as material witnesses could be charged with unlawful entry into the United States in violation of Title 8, United States Code, Section 1325. Nevertheless, individuals detained as material witnesses are rarely charged with crimes.

With no charges lodged against them, material witnesses are held in custody for periods ranging from several weeks to several months. If the material witness were charged with a crime, he would be entitled to appointment of counsel if he was financially unable to afford one. The material witness is deprived of liberty without an opportunity to consult with counsel or to have his interests represented because he is not charged with a crime. Consequently, individuals that are incarcerated without being charged with criminal activity are afforded less protection than individuals charged with criminal activity.

The second factor to be considered is whether utilization of extant procedures creates the risk of an erroneous deprivation of an individual’s liberty and whether any additional safeguards will protect against such a risk. This Court takes judicial notice of the fact that the vast majority of individuals held as material witnesses in the Western District of Texas are Latin American. For the most part these individuals are uneducated and do not speak the English language. In this District, most individuals brought before a Magistrate to determine whether they should be held as material witnesses are without representation and unable to challenge the evidence relied upon by the Government to support holding them as material witnesses. If the determination is made that an individual should be held as a material witness, the individual must be treated in accordance with the provisions of 18 U.S.C. § 3142. Again, if the individual is unable to understand the proceedings in which he is involved, he will be unable to introduce evidence that might weigh in favor of his being released on a personal recognizance bond or on a bond imposing less onerous conditions than might ordinarily be imposed.

As a final matter, this Court is of the opinion that 18 U.S.C. § 3144 requires that an individual incarcerated as a material witness be deposed if certain requirements are met. Without the assistance of counsel, it is this Court’s belief that depositions of material witnesses rarely go forward and that as a consequence the incarceration of material witnesses is prolonged. Thus, this Court is of the opinion that extant procedures not only create the risk of erroneous deprivations of liberty, but also create the risk of unnecessarily prolonged deprivations of liberty.

While this Court does not believe that the appointment of counsel to represent a materia] witness will solve all of the problems that surround the incarceration of individuals who are not charged with crimes, this Court firmly believes that the appointment of counsel to represent these individuals will ensure that any decision to continue their incarceration is well reasoned and based upon full consideration of all relevant evidence. In addition, appointment of counsel will help ensure that a material witness receives all of his rights as set forth in 18 U.S.C. § 3142, and will ensure that any conditions imposed upon the release of the individual will be only as stringent as is required to secure his presence as a witness at trial. Lastly, counsel appointed to represent the material witness can ensure that the material witness receives all rights available to him under 18 U.S.C. § 3144 and Rule 15 of the Federal Rules of Criminal Procedure regarding the deposition of individuals prior to trial.

This Court believes that appointment of counsel will be beneficial to individuals incarcerated as material witnesses in three distinct areas. Appointment of counsel will ensure 1) that it is appropriate to detain the individual as a material witness; 2) that the individual will not be incarcerated when there are other means available to secure his presence at trial; and 3) that any incarceration of an individual will not be prolonged unnecessarily. The value of this additional safeguard is obvious to this Court.

The final factor that the Court must consider involves the “Government’s interests, including the function involved and the physical and administrative burdens that the additional or substitute procedural requirement would entail.” This Court recognizes that the Government has a substantial interest in securing essential testimony for use in criminal trials. Nevertheless, this Court does not believe that affording counsel to individuals threatened by incarceration will impair that interest. The Court also realizes that appointment of counsel to represent material witnesses will involve a great deal of expense. Funds will have to be appropriated to compensate attorneys appointed by the Court. On the other hand, if appointment of counsel facilitates the desirous effect of causing material witnesses to be deposed in accordance with procedures set forth by 18 U.S.C. § 3144 and Rule 15 of the Federal Rules of Criminal Procedure, incarcerated individuals should be released from prison at an earlier date than would otherwise occur. Thus, there is the possibility that shorter terms of incarceration and the decrease in costs of jailing material witnesses, could offset any expense incurred by appointing counsel to represent indigent individuals.

The Court realizes that appointment of counsel to represent material witnesses will involve additional court proceedings. Nevertheless, the additional burden on the Court and on counsel is more than outweighed by the liberty interest of material witnesses.

Upon a balance of the factors set forth in Matthews v. Eldridge, supra, this Court is of the opinion that the scales weigh strongly in favor of appointing counsel to represent material witnesses who are financially unable to afford counsel. Indeed, this Court believes that the due process requirement of a meaningful opportunity to be heard cannot be met unless counsel is appointed. In the context of an accused’s right to counsel, the Supreme Court has said:

The right to be heard would be, in many cases, of little avail if it did not comprehend the right to be heard by counsel. Even the intelligent and educated layman has small and sometimes no skill in the science of law. If charged with crime, he is incapable, generally, of determining for himself whether the indictment is good or bad. He is unfamiliar with the rules of evidence. Left without the aid of counsel he may be put on trial without a proper charge, and convicted upon incompetent evidence, or evidence irrelevant to the issue or otherwise inadmissible. He lacks both the skill and knowledge adequately to prepare his defense, even though he have [sic] a perfect one. He requires the guiding hand of counsel at every step in the proceedings against him. Without it, though he be not guilty, he faces the danger of conviction because he does not know how to establish his innocence. If that be true of men of intelligence, how much more true is it of the ignorant and illiterate or those of feeble intellect.

Powell v. State of Alabama, 287 U.S. 45, 68-69, 53 S.Ct. 55, 64, 77 L.Ed. 158 (1932). In Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799 (1963) the Court stated:

[I]n our adversary system of criminal justice, any person haled into court, who is too poor to hire a lawyer, cannot be assured a fair trial unless counsel is provided for him. This seems to us to be an obvious truth. Government, both state and federal, quite properly spend vast sums of money to establish machinery to try defendants accused of crime. Lawyers to prosecute are everywhere deemed essential to protect the public’s interest in an orderly society. Similarly, there are few defendants charged with crime, few indeed, who fail to hire the best lawyers they can get to prepare and present their defenses. That government hires lawyers to prosecute and defendants who have the money hire lawyers to defend are the strongest indications of the widespread belief that lawyers in criminal courts are necessities, not luxuries. The right of one charged with crime to counsel may not be deemed fundamental and essential to fair trials in some countries, but it is in ours. From the very beginning, our state and national constitutions and laws have laid great emphasis on procedural and substantive safeguards designed to assure fair trials before impartial tribunals in which every defendant stands equal before the law. This noble ideal cannot be realized if the poor man charged with crime has to face his accusers without a lawyer to assist him.

372 U.S. at 344, 83 S.Ct. at 796.

While both Gideon and Powell involved the right to counsel where an individual was accused of a felony, this Court believes that their rationale is relevant to any proceeding where an individual is for the first time threatened with a loss of liberty. See Argersinger v. Hamlin, 407 U.S. 25, 92 S.Ct. 2006, 32 L.Ed.2d 530 (1972) (indigent individual charged with misdemeanor entitled to appointment of counsel); see also In Re Gault, 387 U.S. 1, 87 S.Ct. 1428, 18 L.Ed.2d 527 (1967) (right to representation in juvenile proceeding where juvenile facing potential incarceration). This Court does not believe that categorizing a case as criminal or civil is controlling when an individual faces a loss of liberty. Ridgway v. Baker, 720 F.2d 1409, 1413 (5th Cir.1983). Counsel is required so that the material witness may know precisely what is happening, so that he is aware of the prospect of incarceration, and so that he is treated fairly by the prosecution. Consequently, this Court will grant the Petitioners’ motion for partial summary judgment insofar as it seeks a ruling from this Court that individuals held as material witnesses in the Western District of Texas are entitled to appointment of counsel when they are financially unable to retain their own.

This Court will deny the Petitioners’ motion for partial summary judgment insofar as it seeks to have all currently incarcerated material witnesses released where those individuals have not been appointed counsel. To do so would unfairly penalize the Government. The Court will also deny the Petitioners’ alternative request seeking immediate appointment of counsel to represent all material witnesses who are presently incarcerated. In addition, this Court will not require that presently incarcerated material witnesses be immediately deposed and then released. Due to the number of persons presently incarcerated as material witnesses in this District, the Court does not believe it to be administratively feasible to mandate immediate relief. The Court will, however, require compliance with this Order by a specific date.

This Court realizes that each Division of the Western District of Texas has unique problems that arise when competent counsel are sought to be appointed to represent indigent individuals. Consequently, this Court believes that a uniform plan for appointing counsel to represent individuals held as material witnesses is not advisable. Thus, this Court will direct that the presiding United States District Court Judge in each division of this District shall institute a plan to provide for the representation of material witnesses. If the presiding Judge in a Division would prefer not to draft and implement a plan in accordance with this Order, he may have the District’s Chief Judge take steps to prepare that Division’s procedure. This Court will require that each Division adopt and institute a plan for appointing counsel to represent material witnesses no later than August 2, 1985. The plans adopted by each Division shall have prospective application only.

With regard to individuals presently incarcerated as material witnesses, this Court will require that counsel be appointed to represent such individuals only if they remain in custody after July 15, 1985. Thus, unless individuals presently incarcerated as material witnesses are released by July 15, 1985, this Court will require that counsel be appointed to represent those who are financially unable to retain counsel. This Court realizes that requiring either appointment of counsel or release of presently incarcerated material witnesses by July 15 creates a burden on the Court and counsel for both the Government and defendants. Nevertheless, this Court believes that any burden is far outweighed by the liberty interest possessed by persons incarcerated without being charged with any crime. Therefore,

IT IS HEREBY ORDERED that the Petitioners’ motion for partial summary judgment be GRANTED insofar as it seeks a determination by this Court that individuals held as material witnesses in the Western District of Texas are entitled to appointment of counsel when they are financially unable to retain their own and is otherwise denied in all respects.

IT IS FURTHER ORDERED that the presiding District Court Judge in each Division of the Western District of Texas shall draft and implement a plan for appointing counsel to represent individuals held as material witnesses no later than August 2, 1985. If the presiding Judge in any Division would prefer to have the District’s Chief Judge prepare a plan in accordance with this Order, he should immediately inform the Chief Judge of his preference. These plans shall be applicable only to those individuals held or sought to be held as material witnesses after August 2, 1985.

IT IS FURTHER ORDERED that unless individuals presently incarcerated as material witnesses in the Western District of Texas are released by July 15, 1985, attorneys shall be appointed to represent those individuals to the extent that they cannot financially afford to retain an attorney on their own.

      . This Court believes that Section 3142(f) requires a detention hearing only when a judicial officer determines that an individual should not be released on his own recognizance or on an unsecured appearance bond. See 18 U.S.C. § 3142(a), (b), (c) & (f). Because § 3142(f) controls appointment of counsel, this Court believes that it requires counsel to be appointed only if conditions of release are sought to be imposed pursuant to § 3142(c).

      . This Court notes that often a defendant charged with unlawful transportation of aliens is released under 18 U.S.C. § 3142 while individuals held as material witnesses in connection with the case are incarcerated until the case is disposed of.

      . This Court realizes that, due to the delay involved, it would be impracticable to have counsel appointed to represent an individual sought to be held as a material witness at the time of his initial appearance before the Magistrate. Nonetheless, after the initial determination is made that an individual should be held as a material witness, counsel appointed to represent the individual could move for the Court to reconsider its Order. The motion to reconsider should be heard prior to or at the same time as the detention hearing required by 18 U.S.C. § 3142(f).

      . This Court would distinguish the limited right to counsel established by Gagnon v. Scarpelli, 411 U.S. 778, 93 S.Ct. 1756, 36 L.Ed.2d 656 (1973), in probation revocation cases. In the case of a probation revocation, the individual has already been convicted of a crime and, in many instances, has been sentenced by the court. All that needs to be determined is whether the individual complied with the terms of his probation, and, if not, the court must make the determination of whether it should exercise its discretion in favor of revocation. In the case of individuals to be held as material witnesses, they have not been convicted of a crime and they are facing a deprivation of liberty without being charged with criminal activity. While in both instances a liberty interest is at stake, this Court believes that the quality of the liberty interest involved where an individual is neither convicted nor accused of a crime is different than that held by an individual who has been tried, convicted and sentenced.


author: FEIKENS, Chief Judge.

text:
    Gary L. CATTIN, and Thomas F. Omans, Individually, and as Representatives of a Class of Individuals Similarly Situated, Plaintiffs, v. GENERAL MOTORS CORPORATION, a Delaware Corporation, and Electronic Data Systems Corporation, a Texas Corporation, Defendants.
    Civ. A. No. 84-8601.
    United States District Court, E.D. Michigan, S.D.
    June 28, 1985.

      Jules B. Olsman, Woll, Crowley, Berman & Olsman, P.C., Southfield, Mich., for plaintiffs.
    David M. Davis, Detroit, Mich., for defendant GMC.
    Terence V. Page, Clark, Hardy, Lewis, Pollard & Page, P.C., Birmingham, Mich., for defendant EDS.
    William J. Chadwick, Paul, Hastings, Janofsky & Walker, Los Angeles, Cal., for EDS.
   MEMORANDUM OPINION AND ORDER

FEIKENS, Chief Judge.

This action is brought by two former employees (“plaintiffs”) of defendant General Motors Corporation (“GM”), who allege that GM wrongfully terminated their entitlement to early retirement benefits and improperly modified its offer of special recognition stock to them. Plaintiffs originally claimed that GM’s termination of early retirement benefits violated the vesting and nonforfeiture requirements in the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1053(a) (1982), and constituted a breach of contract. After GM moved for summary judgment on these claims, plaintiffs conceded that the ERISA claim had no basis in law. I now consider GM’s motion for summary judgment on the breach of contract claim.

Plaintiffs were employees of GM for 27 years. As GM employees plaintiffs were entitled to pension benefits under the General Motors Retirement Program (“the Program”). Among the benefits provided by the Program were certain early retirement benefits available to employees with 30 or more years of credited service. These “30- and-out” benefits are the subject of this dispute.

In September, 1984, GM announced a proposal to acquire defendant Electronic Data Systems (“EDS”). As the Program was written at that time, the transfer of GM employees to EDS would not have prevented those employees from continuing to receive credit for their service (“credited service”) so that they could qualify for additional benefits under the Program. Specifically, the Program provided that credited service would include employment with one of GM’s “directly or indirectly wholly-owned or substantially wholly-owned domestic or foreign subsidiaries.”

On October 3, 1984, prior to completion of the acquisition, GM alleges that the Program was amended pursuant to GM’s authority to “amend, modify, suspend, or terminate the Program.” GM Retirement Program for Salaried Employees, General Provision § 8(a). The amendment provided that employment with any “directly or indirectly wholly-owned or substantially wholly-owned subsidiary of the Corporation acquired or formed by the Corporation on or after March 1, 1984” would not be credited service “unless specifically approved by the General Motors Corporation Board of Directors.” GM Retirement Program for Salaried Employees, Part A, Art. Ill, § 1(a)(1). At the same time, however, the Program appeared to protect the interests of employees with ten years of credited service by providing that:

[notwithstanding any other provisions of this Program, in connection with the transition of General Motors employees to EDS, termination of employment with General Motors to accept employment with EDS shall not be considered as having terminated employment for purposes of this program provided such employee on his last day worked for General Motors has ten or more years of credited service.

GM Retirement Program for Salaried Employees, General Provision § 14(f).

GM’s acquisition of EDS was completed later in October, 1984. GM plans to have EDS assume GM’s data processing activities, and to effectuate this GM transferred approximately 7,000 of its employees to EDS as of January 1, 1985. Plaintiffs allegédly were informed that unless they went to work for EDS, their employment with GM or EDS would be terminated.

Plaintiffs argue that GM has discontinued their eligibility for 30-and-out benefits. Plaintiffs claim that this violates the Program’s pre-amendment provision crediting service with GM’s subsidiaries and also section 14(f)’s protection of the rights of transferred employees with ten or more years of credited service. While plaintiffs concede that these alleged rights are not protected by ERISA, they argue that ERISA does not preempt an action enforcing their contractual rights. I have previously accepted the view that contract actions are not preempted by ERISA, and I adhere to that position here. As I explained in Holliday v. Xerox Corp., 555 F.Supp. 51, 55 (E.D.Mich.1982), aff'd, 732 F.2d 548 (6th Cir.), cert. denied, — U.S.-, 105 S.Ct. 294, 83 L.Ed.2d 229 (1984):

[T]he preemption problem is irrelevant to the existence of a valid contract because nothing in ERISA indicates that Congress intended to make contracts unenforceable. Rather, if the state law is preempted, then the contract must be construed in accordance with federal law, in this case the federal common law of contract. There is no substantial body of federal common law of contract. Thus, state law will be looked to as a guide.

At a hearing on this motion, GM claimed that any contractual right plaintiffs had was lawfully terminated when the Program was amended on October 3, 1984, to provide that employment for subsidiaries acquired after March 1, 1984, would not constitute credited service. Plaintiffs responded that GM could not be granted summary judgment on this theory for several reasons. First, plaintiffs contended that this amendment had not yet gone into effect. Second, plaintiffs argued that even if the amendment was in effect, section 14(f) continued to protect the rights of employees with more than ten years of credited service with GM. Plaintiffs argued that this protection was a contractual right and also came within the doctrine of promissory estoppel because plaintiffs had relied on this protection in performing services for GM and later transferring to EDS.

In arguing that the amending language has no present effect, plaintiffs contend that the amendment is only a proposal and will not be binding until the Internal Revenue Service has determined that the amendments will not effect the Program’s qualified status under the tax code. GM disputes this, claiming that the Board of Directors already adopted the amendments and they became effective October 3, 1984. GM has filed an affidavit of Richard Brewer, who is responsible for drafting the amending language for GM. Mr. Brewer states that the amendments became effective on October 1, 1984, but then adds that “[o]nce the draft program language is finalized, a copy will be submitted to the Internal Revenue Service along with a request for favorable determination confirming that recent amendments do not adversely affect the program’s qualified status under section 401(a) of the Internal Revenue Code, 26 U.S.C. § 401(a).” Affidavit of Richard L. Brewer, p. 2. Furthermore, GM indicated at the hearing that if the plan is not approved, GM will not be bound by the amending language. On this record, I can only conclude that there is a serious dispute as to the present effect of the amendment. The existence of this genuine issue of material fact precludes summary judgment.

Even if the amendment was in effect, this case raises serious issues concerning the non-statutory limitations, if any, on GM’s power to unilaterally amend the Program. At the hearing on this motion, I expressed the view that assuming GM’s amendment had gone into effect—excluding employment by EDS from “credited service”—it appeared that section 14(f) protected the rights of employees with ten or more years credited service. By letter of June 10, 1985, GM informed the Court that it has again amended the Program so that now even these employees will not accrue additional credited service. Hence, GM now asserts the rights to modify 30-and-out benefits for its employees even when those employees have completed more than 27 of the years of service required for such benefits and have transferred to GM’s subsidiary with the alleged expectation that their eligibility for 30-and-out benefits was preserved by the Program.

In light of my finding that there is a question of fact as to the present effect of GM’s amendment, I need not decide at this time whether such an amendment is unenforceable. I raise this possibility because GM is entitled to renew its motion for summary judgment if new developments eliminate the factual question about the finality of the amendment. If it chooses to do so, both parties should fully brief two issues that are raised by this discussion. First, as a matter of contract law, can GM limit entitlement to 30-and-out benefits as it has here where the effected employees have performed a substantial part of the required consideration? See Finnell v. Cramet, Inc., 289 F.2d 409, 413 (6th Cir.1961); In re White Farm Equipment Co., 42 B.R. 1005, 1016-18 (N.D.Ohio 1984); Annot., 46 A.L.R.3d 464, 468 (1972) (“Employees who, at the time of discontinuance or amendment of a plan which authorized the employer to modify or terminate it for any reason, had not yet qualified for a pension, have been held not entitled to any benefits.”). Second, where an employer expressly reserves the right to terminate or amend a pension plan in the plan document, can a claim of promissory estoppel be based on a promise in the same document to provide certain benefits? See 1A COR-BIN ON CONTRACTS § 201 (1963) (“Before the rule [of promissory estoppel] can be applied, there must be a real promise to be enforced. Action in reliance on a supposed promise creates no obligation on a man whose only promise is wholly illusory. A sales agency agreement in which the principal specifies the terms on which cars are to be supplied, but makes no promise to supply any specific or ascertainable number of cars, and in which it is expressly provided that it shall be terminable at will, is not enforceable against the principal.”).

In sum, as a genuine issue of material fact is raised by plaintiff’s contract claim, summary judgment on that claim is unwarranted. At the same time, plaintiffs concede that their claim based on ERISA’s vesting and nonforfeiture provision, 29 U.S.C. § 1053(a), is legally insufficient. Accordingly, GM’s motion for summary judgment is GRANTED on the ERISA claim, but DENIED on the contract claim.

IT IS SO ORDERED.


author: MORAN, District Judge.

text:
    Sharon MOORE and Jimmie Moore, Johnny Jefferson, individually on behalf of all persons similarly situated, Plaintiffs, v. Jeffrey MILLER, Director of the Illinois Department of Public Aid, and the Illinois Department of Public Aid, Defendants.
    No. 81 C 7265.
    United States District Court, N.D. Illinois, E.D.
    June 28, 1985.

      Thomas Grippando, Dorie Budlow, Cook County Legal Assistance Foundation, Chicago, 111., for plaintiffs.
    Neil F. Hartigan, Atty. Gen. for State of 111., for defendants; Steven Hogroian, Owen M. Field, of counsel.
   MEMORANDUM AND ORDER

MORAN, District Judge.

In Quern v. Jordan, 440 U.S. 332, 99 S.Ct. 1139, 59 L.Ed.2d 358 (1979), the Supreme Court approved a district court order requiring notice be sent to class members informing them of state administrative avenues available for retrospective monetary relief if the members were improperly denied benefits. The Court found the notice to be “ancillary” to the prospective relief already ordered by the district court and allowed by Ex Parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908), and Edelman v. Jordan, 415 U.S. 651, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974). Plaintiffs in the present ease seek notice relief even though this court’s injunction regarding the handling of benefit payments has been rendered a nullity by a change in federal law. The Sixth Circuit has held such notice relief unavailable. See Banas v. Dempsey, 742 F.2d 277 (6th Cir.1984), cert. granted sub nom Green v. Mansour, — U.S.-, 105 S.Ct. 1863, 85 L.Ed.2d 158 (1985). The Banas court found that notice relief was required to attach to some prospective injunctive relief and because none existed notice relief would not be allowed. This court disagrees and grants the notice relief requested.

I. HISTORY

Plaintiff filed this class action complaint in December 1981, attacking the Illinois Department of Public Aid’s method of determining income levels with regard to receipt of earned income credits. In December 1983 this court granted plaintiff’s motion for a preliminary injunction. See Moore v. Miller, 579 F.Supp. 1188 (N.D.Ill.1983). The court held that IDPA had to have a reasonable certainty of EIC eligibility before deducting expected receipt of EIC payments from a recipient’s income in the calculation of AFDC benefits and could not rest upon assumptions. Effective October 1, 1984, the Deficit Reduction Act of 1984, Public Law No. 98-369, § 2629, changed the federal statute to allow crediting a recipient’s income with an EIC payment only if an EIC payment is actually received. See 42 U.S.C. § 602(d)(1) (1985). This standard is in accord with the IDPA’s practice after this court’s grant of a preliminary injunction and this court’s order of May 4, 1984.

Now before the court is plaintiffs’ motion for summary judgment, seeking declaratory and notice relief as well as permanent injunctive relief. Defendants move to dismiss and for summary judgment. Defendants also move to dissolve the preliminary injunction issued by this court in 1983. In addition, plaintiffs’ motion for class certification still remains from its filing at the inception of this action.

II. INJUNCTION

Plaintiffs move for a permanent injunction regulating the crediting of EIC payments to AFDC recipient’s incomes. At the same time defendants move to dissolve the present preliminary injunction. Due to the change in the law, and without any indication that defendants interpret that law differently than espoused in their briefs, the' court would be disposed to dissolve the injunction but for an uncertainty respecting reimbursement of persons who had ceased being recipients between December 1983 and March 1984, when IDPA changed its policy and thereafter reimbursed those entitled who were still recipients. Dissolution of an injunction is warranted after a “showing of changed circumstances so that continuance of the injunction is no longer justified and/or because it will work oppressively against the enjoined parties.” American Optical Co. v. Rayex Corp., 291 F.Supp. 502, 510 (S.D.N.Y.1967), aff'd 394 F.2d 155 (2d Cir.), cert. denied 393 U.S. 835, 89 S.Ct. 109, 21 L.Ed.2d 106 (1968). The changed law is just such an occurrence. Defendants’ position before the issuance of the preliminary injunction was reasonable, though found by this court to be erroneous. To maintain that position in face of a changed law would not be reasonable. The court finds the purpose of the preliminary injunction has been largely fulfilled, the complained-of conduct has been discontinued, and such conduct is unlikely to recur. See Burgoyne v. Lukhard, 410 F.Supp. 477 (E.D.Va.1976). No gain can come by continued supervision by this court, except for resolution of the one outstanding matter. Accordingly, the preliminary injunction regulating defendants’ crediting of EIC payment in the calculation of a recipient’s income is continued only for the limited purpose indicated.

III. CLASS ACTION

With the preliminary injunction largely dissolved, it is now appropriate to determine the motion for class certification before proceeding further. Defendants raise two arguments against certification. First, they claim that plaintiff Sharon Moore is not qualified to represent the class due to financial information gleaned during discovery. This attack may well be justified, but plaintiff Jefferson is still capable of representing the class and thus certification can occur. Defendants’ second argument is stronger. They claim that because prospective injunctive relief is no longer sought, plaintiffs’ claims are moot and class certification is not warranted.

Judge Marshall, in Simpson v. Miller, 93 F.R.D. 540 (N.D.Ill.1982), dealt with the identical issue facing this court. In Simpson, plaintiffs, complaining of erroneous calculations of income for AFDC purposes, sought class certification and notice relief after a change in federal law made any claim for prospective injunctive relief moot. Judge Marshall, in analyzing defendants’ claim of mootness, applied the two-part test enunciated in United States Parole Commission v. Geraghty, 445 U.S. 388, 396, 100 S.Ct. 1202, 1208, 63 L.Ed.2d 479 (1980). First, he found that plaintiff had a live interest in the outcome of the litigation because they continued to be denied the full extent of the benefits they did not receive due to the IDPA’s failures. See Simpson v. Miller, 93 F.R.D. at 543. Plaintiffs still claim a present need for notice relief. Second, he found plaintiffs had a personal stake in the claim for notice relief. He made this finding because the purpose of the personal stake requirement, to ensure an adversarial presentation of concrete issues, remained satisfied by plaintiffs’ request for notice relief. Id. at 545.

This court finds Judge Marshall’s analysis in Simpson fully applicable to the present action, and notes that the Bañas court followed a similar analysis. Plaintiffs in this case do continue to have a live controversy. They complain of shortfalls in their past AFDC payments. These shortfalls have not yet been remedied. They seek notice relief informing them of their administrative remedies. In addition, both plaintiffs and the IDPA are vigorously trying this action with the stakes heavy for both sides. The court finds plaintiffs’ claims for notice relief not to be moot.

The court now turns to Rule 23 considerations for certification of the class. The court finds the four enunciated requirements for Rule 23(c) to be satisfied. This class is much too large to allow joinder. The defendant reimbursed 11,000 recipient families for shortfalls falling between the issuance of the preliminary injunction and the state’s change in their policy. It is expected that more can properly seek notice relief over the four-year period contested. Common questions of law and fact concerning the state’s policy regarding EIC payments exist at the crux of this case. Typicality, at least as far as the relief that can be awarded by this court, exists. Finally, the court finds that plaintiff Jefferson, and the attorneys handling this action, have fairly and adequately protected the interests of the class.

In the present case the IDPA has acted “on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole.” Rule 23(b)(2). Thus, a Rule 23(b)(2) class is appropriate. Because the present action satisfies the requirements of Rule 23, and the case is not moot, this court grants plaintiffs’ motion for class certification.

IV. DECLARATORY RELIEF

Plaintiffs seek declaratory relief against defendants. Such relief, as long as directed against state officials and not the state itself, is permissible within the constraints of the Eleventh Amendment. See 13 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure, § 3225 at 194 (2d Ed.1984). Plaintiffs seek a declaration that between October 1, 1981 and October 1, 1984 defendants were required to calculate EIC payments in accordance with the standards set out in this court’s previous memorandum.

Having reviewed its previous memorandum and order, this court agrees with its earlier conclusion. Buttressing the findings in that memorandum and order is an AFDC action transmittal, # SSA-AT-84-7, dated April 24, 1984. That transmittal requires calculations consistent with this court’s ruling and inconsistent with defendants’ practice before this court’s ruling. The court grants defendants’ motion for declaratory judgment.

The purpose of this declaratory action is to ensure proper adjudication of requests for reimbursement filed through state administrative procedures. Under the federal statutes states are required to correct any underpayment of aid. See 42 U.S.C. § 602(a)(22) (1985). The amount of underpayment is calculated following regulations extant at the time of the underpayment. See 45 C.F.R. § 233.20(a)(13)(ii) (1982). The declaratory relief would ensure that any administrative determinations of past underpayments would be adjudicated in conformity with this court’s earlier findings.

Y. NOTICE RELIEF

Finally, having largely dissolved the injunction and granted declaratory relief, the court now turns to the remaining issue: notice relief. Plaintiffs seek court ordered notice informing class members that they may have been underpaid due to the IDPA’s policies and informing them of the state administrative remedies. The court in Quern v. Jordan, 440 U.S. 332, 99 S.Ct. 1139, 59 L.Ed.2d 358 (1979), found such notice relief in a similar situation appropriate when it was “ancillary to the prospective relief already ordered by the court.” Id. at 349, 99 S.Ct. at 1149.

The Sixth Circuit, in Banas, 742 F.2d 277, relied on this “ancillary” language in denying notice relief. The Bañas court found that notice relief was not by itself within the contours of relief allowed by Ex Parte Young. It noted the fiction of Young, that prospective injunctive relief was not an action against the state but instead an action requiring state officials to comply with federal law, and then interpreted Quern’s “ancillary” language to be some sort of tacking-on of notice relief to the Young relief, as in the concept of ancillary jurisdiction. When further prospective relief is no longer required, the court found there is nothing to which to tack on notice relief and thus such relief runs afoul of the eleventh amendment.

Because it is the fiction of Young that shelters such ancillary orders from not being orders against the state, when the basis of that fiction—the need for injunctive relief to force state officials to comply with federal law—disappears, so does the shelter.

742 F.2d at 288. In this district, Judge Grady has explicitly followed the reasoning of the Banas court. In Dandridge v. Coler, No. 84 C 930 (N.D.Ill. Jan. 25, 1985), the court found that plaintiffs request for notice relief was not allowed because not “ancillary to something more than a declaratory judgment governing past official conduct,” and thus found no valid claim for relief. See id., slip at 6. See also Colbeth v. Wilson, 554 F.Supp. 539, 546 (D.Vt.1982), aff'd sub nom. Colbeth v. O’Rourke, 707 F.2d 57 (2d Cir.1983).

This court is somewhat puzzled by the above cases. The argument constructed by the Bañas court, and accepted in Dandridge, is theoretically consistent with Ex Parte Young, and a defensible interpretation of certain language in Quern, but is inconsistent with results actually achieved in that litigation. The history of the Quern litigation, filed in this district, is crucial to the present determination. The action was filed because of failures of the IDPA to promptly commence Aid to the Aged, Blind and Disabled (AABD) payments to eligible recipients. The district court granted both injunctive and retroactive damage relief to plaintiffs. In Edelman v. Jordan, 415 U.S. 651, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974), the Supreme Court found the retroactive damage relief to be violative of the Eleventh Amendment. Significantly, however, by the time the Edelman decision was rendered, the AABD program was no longer in operation. See id. at 653 n. 2, 94 S.Ct. at 1351 n. 2. It had been replaced by the federally funded and administered supplemental security income program. Quern v. Jordan, 440 U.S. at 348 n. 20, 99 S.Ct. at 1149 n. 20. The case thus went back to the district court in a posture where any prospective relief was mooted by the dissolution of the program and thus no prospective injunctive relief existed. The court ordered notice relief and, after modification by the Seventh Circuit, this grant of notice relief was affirmed by the Supreme Court in Quern. Thus, the Court in Quern allowed notice relief even though there really wasn’t any ongoing prospective injunctive relief to which to attach the notice relief.

This necessarily brings into question the Sixth Circuit’s interpretation of the term “ancillary” used in Quern. The most common legal use of “ancillary,” and the one followed by the Sixth Circuit in Banas, is in the realm of subject matter jurisdiction, where one claim, for which no subject matter jurisdiction exists, for reasons of convenience and fairness, is attached onto a claim properly before the court. See e.g. Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978). This usage, on its face, does not seem applicable to eleventh amendment cases because jurisdictional tacking-on allowed by the concept of ancillary jurisdiction for fairness and convenience seems no basis for allowing federal court adjudication of a claim otherwise not allowed by a specific amendment to the Constitution. In Eleventh Amendment cases, however, the term “ancillary” has taken on additional legal meaning. In Edelman, the court held that retrospective damage awards were not allowed because they came directly from a state’s treasury, but it allowed prospective injunctions, even though such injunctions inevitably cost the state money. These inevitable costs were found to be a permissible and often inevitable “ancillary effect on the state treasury.” Edelman, 415 U.S. at 668, 94 S.Ct. at 1358. In Quern itself, the court noted, in its only other use of the word “ancillary,” that prospective injunctions may have “an ancillary effect on the state treasury.” Quern v. Jordan, 440 U.S. at 337, 99 S.Ct. at 1143. In these usages, “ancillary” seems to refer to inevitable and permissible costs.

Two factors convince this court that notice relief is itself prospective relief and that “ancillary” in that context means “an inevitable and permissible cost” which is an acceptable part of the prospective relief. First, as stated previously, such is the prior usage of the word in Eleventh Amendment cases and in the Quern case. See Quern v. Jordan, 440 U.S. at 337, 99 S.Ct. at 1143; Edelman v. Jordan, 415 U.S. at 667, 94 S.Ct. at 1357. The Quern decision, in a short substantive discussion of the notice issue, found that notice relief “falls on the Ex Parte Young side of the eleventh amendment line rather than on the Edelman side” because the claim of causation between the notice relief ordered and the payment of retrospective damages had many “missing links.” Quern, 440 U.S. at 347, 99 S.Ct. at 1148. Notice relief does not itself entail a federal direction of reimbursement. Rather, it advises possible claimants of a possible state administrative procedure by which claims can possibly be filed and paid. It looks toward future action by claimants and the state. Similarly, the citation to the portion of Milliken v. Bradley, 433 U.S. 267, 97 S.Ct. 2749, 53 L.Ed.2d 745 (1977) which discusses the prospective nature of programs designed to “bring about the delayed benefits of a unitary system,” 433 U.S. 267 at 290, 97 S.Ct. at 2762, seems to emphasize the court’s finding that notice relief is itself prospective in nature, even though designed to facilitate the payment of past shortfalls and thus be acceptable under the Eleventh Amendment even without a pending prospective injunction.

Second, and most significant, is the allowance of notice relief in Quern, even though there was no effective ongoing injunction. This court is wary of placing too much emphasis on one word in a Supreme Court opinion, but it is on that word that the Banas court rested its decision. This court disagrees with the interpretation in Banas. That disagreement can perhaps be underscored by the application of the Bañas court’s reasoning to the facts in this case. The preliminary injunction here was entered in December 1983 (and it has not been entirely dissolved, although this court does not rest on that fact). In May 1984 the state changed its policy so as to go beyond what this court believed in December to be its federal obligations. That change was identical to the obligations created by federal law in October 1984. IDPA contends that injunctive relief was no longer necessary after May 1984. If there had been no change in the federal statute the Department would be advancing the same contention that it advances now, the bar of the Eleventh Amendment, on the basis of the Bañas court reasoning. Notice relief would then depend upon whether a court did or did not believe that a continuation of injunctive relief was appropriate. This court does not believe that the application of the Eleventh Amendment with respect to notice relief should or does turn upon a discretionary judgment concerning the continuation of equitable relief. In the fictional world relating the Eleventh Amendment to remedies for official misconduct or error, that concept adds but another and unwarranted uncertainty.

In Quern, this court believes, the Supreme Court held that notice relief is permissible prospective relief without regard to an injunctive order and even though it has an ancillary impact upon a state treasury. In light of such an interpretation, notice relief is warranted here.

CONCLUSION

The change in federal law has largely negated the need for continuing prospective relief but it has not negated the reasons for continuing this suit. Pursuant to the reasoning in this Memorandum and Order, the court finds the following relief appropriate:

(1) The preliminary injunction is dissolved, except to the extent stated herein;

(2) Plaintiffs’ motion for class certification is granted;

(3) Plaintiffs’ motion for declaratory relief is granted; and

(4) Plaintiffs’ motion for notice relief is granted.

The parties are instructed to submit proposed notice forms within fifteen days to this court.

      . A more detailed history of this case is included in that memorandum and order.

      . As in Simpson, certification is occurring here after the change in the law. This court, in agreement with Judge Marshall, sees no mootness problem arising because of that timing. See Simpson v. Miller, 93 F.R.D. at 545 (1982).

      . For a more detailed application of this issue, reaching the same result, see Burnham, Retroactive Welfare Benefits: Federal Class Actions after Edelman v. Jordan, 18 Clearinghouse Review 225 (July 1984).