United States District Court, D. New Mexico
MEMORANDUM OPINION AND ORDER APPROVING SETTLEMENT
Walter Stephen Jackson et al. (Plaintiffs), Intervenor Arc of
New Mexico (Arc) and pro se Intervenors Mary Terrazas, et al.
(jointly, Intervenors), and Defendants Los Lunas Center, et.
al. (Defendants), seek final approval of a joint settlement
agreement that provides a resolution to a dispute
over Defendants' treatment of class members.
April 17, 2019, the parties jointly filed a motion asking the
Court to give preliminary approval to the Settlement
Agreement. On April 18, 2019, the Court held a
hearing on the motion. During the hearing, counsel clarified
provisions of the Preliminary SA. On April 19, 2020, the
Court approved the Preliminary SA as clarified and directed
the parties to issue Notice to all Plaintiff Class Members
4, 2019, the parties filed their Joint Motion for Final
Approval, Joint Memorandum, and final Settlement Agreement,
which as directed by the Court's Preliminary Approval
Order, clarified the language of the Preliminary
12, 2019, the Court held a hearing on final approval of the
Settlement Agreement. Present for the Plaintiffs were Steven
Schwarz, Peter Cubra, Cathy Costanza, Tim Gardner, Philip
Davis, Ann McCartney, and Debra Poulin. Present for
Defendants were Jerry A. Walz, Kathyleen Kunkel, Billy
Jimenez, Jason Cornwell, and Matthew Garcia. Present for the
Intervenors were Maureen Sanders and Jacqueline
Mader. At the hearing the following five
guardians and/or family members of Jackson class members
addressed the Court with expressions of concern: Julie
Bisbee, Hector Romero, Audrey Quintanta, Therese Quintana
Doolittle, and Sophia Nolte. Prior to the hearing, pro se
Intervenor Ava Peets filed written comments expressing
concern,  and at the hearing, she addressed the
considering the long history of the case, the Settlement
Agreement, the arguments of counsel, and the comments of pro
se Intervenor, guardians and/or family representatives of
members of the class, the Court will grant final approval of
the Settlement Agreement. Additionally, the Court will vacate
the Scheduling Order. Moreover, the Court will vacate all other
orders in this case except Jackson by Jackson v. Fort
Stanton Hosp. and Training School, 757 F.Supp. 1243 (D.
N.M. 1990) rev'd in part, 964 F.2d 980 (10th
Cir. 1992) (Jackson I) (Doc. No. 679),
Memorandum Opinion and Order (Doc. No. 831) (granting
Plaintiffs' motion to amend the Complaint by
interlineation to include a claim under the American with
Disabilities Act, 42 U.S.C. § 12101 et. seq.
(ADA)), and the Memorandum Opinion and Order (Doc. No. 890)
(reconfiguring the class).
STANDARD OF REVIEW
court has the discretionary authority to approve a settlement
of a class action. Jones v. Nuclear Pharmacy, Inc.,
741 F.2d 322, 324 (10th Cir. 1984). Federal Rule of Civil
Procedure 23(e) provides the following procedure:
(e) Settlement, Voluntary Dismissal, or Compromise. The
claims, issues, or defenses of a certified class may be
settled, voluntarily dismissed, or compromised only with the
court's approval. The following procedures apply to a
proposed settlement, voluntary dismissal, or compromise:
(1) The court must direct notice in a reasonable manner to
all class members who would be bound by the proposal.
(2) If the proposal would bind class members, the court may
approve it only after a hearing and on finding that it is
fair, reasonable, and adequate.
(3) The parties seeking approval must file a statement
identifying any agreement made in connection with the
(5) Any class member may object to the proposal if it
requires court approval under this subdivision (e); the
objection may be withdrawn only with the court's
notice requirements of Rule 23 are designed to satisfy due
process by providing class members notice of settlement and a
right to be heard. Eisen v. Carlisle &
Jacquelin, 417 U.S. 156, 174 (1974). “[N]otice
must be ‘reasonably calculated, under all the
circumstances, to apprise interested parties of the pendency
of the action and afford them an opportunity to present their
objections.'” Id. at 174 (internal
quotation marks omitted) (quoting Mullane v. Central
Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950)
and like cases).
Rule 23(e)(2) a court may approve a settlement agreement as
fair, reasonable and adequate if the settlement agreement
meets four criteria: (1) the settlement was fairly and
honestly negotiated; (2) serious legal and factual questions
place the litigation's outcome in doubt; (3) the
immediate recovery is more valuable than the mere possibility
of a more favorable outcome after further litigation; and (4)
the parties believe the settlement is fair and reasonable.
Tennille v. Western Union Co., 785 F.3d 422, 434
(10th Cir. 2015). “[T]he district court must
independently analyze the evidence before it in
making its determination[.]” Gottlieb v.
Wiles, 11 F.3d 1004, 1015 (10th Cir. 1993) (emphasis in
original) abrogated on other grounds by Devlin v.
Scardelletti, 536 U.S. 1 (2002).
civil rights class action began 32 years ago on July 8, 1987
when 21 individual developmentally disabled citizens of New
Mexico on behalf of themselves and other similarly situated
individuals (JCMs) filed a complaint to “redress the
unconstitutional and illegal conditions” at Fort
Stanton Hospital and Training School (Fort Stanton) and Los
Lunas Hospital and Training School (Los Lunas) (jointly,
institutions) that operated, in part, with federal
funds.Defendants were the institutions and
individuals operating the institutions. On June 27, 1988, the
Court granted parents and guardians of some of the residents
of the institutions leave to intervene,  which they
did on July 6, 1988.
October 16, 1989, the merits trial commenced. On December 28,
1990, the Court ruled that Defendants had violated the
JCMs' rights under § 504 of the Rehabilitation Act
and the substantive due process clause of the Fourteenth
Amendment of the United States Constitution. See Jackson
by Jackson v. Fort Stanton Hosp. and Training School,
757 F.Supp. 1243 (D. N.M. 1990) rev'd in part,
964 F.2d 980 (10th Cir. 1992) (Jackson I). Since
1990, the parties have attempted to resolve compliance issues
and achieve disengagement of Defendants' obligations to
Jackson I, the Court made detailed findings of fact.
The Court found 18 areas where Defendants' operation of
state supported institutions for the developmentally disabled
were deficient under federal law and the
Constitution. The Court ordered the parties to create
a written plan of correction at each institution for each of
the 18 identified deficiencies. The parties were to submit
the plan to the Court no later than April 1, 1991.
Jackson I, 757 F.Supp. at 1315. The plan was to
include the following: a detailed written policy to be
followed by each institution; identification of an individual
who would be responsible for implementing the policy; a
strategy for achieving the goals of the corrective plans; a
timetable with guidelines for achieving the specific
components of each plan; and a means of assuring continued
compliance with the adopted standards. Id. at 1316.
The Court asked that the plan of correction establish a
timetable for correcting all deficiencies by September 10,
September 27, 1991, Defendants completed a Systemic Plan,
which was amended on November 19, 1993. On January 4, 1993,
Defendants promulgated new polices and procedures for
institutions which were reported to the Court on February 17,
1993. On November 9, 1993, Plaintiffs moved to
amend the Complaint by adding a claim under the American with
Disabilities Act, 42 U.S.C. § 12101 et seq.,
which the Court granted on January 27, 1994.
April 1994, the parties filed a joint motion under Rule
60(b)(5) to modify Jackson I as it applied to Fort
Stanton because by 1995, Fort Stanton would no longer serve
JCMs. The Court granted the motion on June 27,
1994, relieving Defendants from making further improvements
to Fort Stanton. In March 1995, Fort Stanton closed, and
all residents were transferred to community-based services.
1997, after all residents in Los Lunas transitioned to
community-based services, Los Lunas also closed.
Jackson I, the Court entered various remedial orders
and actively oversaw their enforcement. During the pendency
of this case, there have been four consent
decrees. In 1997, the Court entered the first two
consent decrees, a Joint Stipulation on Disengagement (JSD)
and its attached Plan of Action. In subsequent years, the
Court entered two additional consent decrees: in 2005,
Appendix A,  and the 2015 Revised Table
IV. All four documents attempt to resolve
the areas of noncompliance identified in Jackson I.
Each consent decree imposes additional obligations on
October 1997, the parties presented the Court with a joint
motion requesting the Court approve their proposed JSD with a
Plan of Action. The JSD states the criteria and process for
disengagement from most of the identified obligations.
Id. at 20-25. Because both institutions had closed,
the JSD focused on preventing future harm to Plaintiffs'
rights in community settings. See JSD (Doc. 1047-1)
at 14. Toward that end, the JSD groups a specific area of
obligations, identified as “Continued Improvement of
Community Services, ” for a different disengagement
procedure. To disengage from those obligations, Defendants
were required to conduct an annual community audit and
achieve a certain score for four years. Id. at
14-17. After a fairness hearing regarding the JSD on November
20, 1997, the Court entered an Order approving the
set a December 31, 1998 deadline for disengagement of most of
its obligations but indicated that certain requirements would
not be met until December 31, 2000. Id. at 20. These
deadlines were not met.
Plan of Action
addition to the JSD, the parties prepared a Plan of Action,
which was meant to provide a structure to enhance the
community services system. See JSD (Doc. 1047-1) at
28.Initially, the 1997 Plan of Action
comprised thirteen components in thirteen appendices. Each
appendix listed specific activities with their desired
outcomes. Over time, two additional appendices
20, 2005 the parties submitted Appendix A, which sought to
resolve pending motions and to detail actions that would
bring the Defendants into compliance with the
JSD.Appendix A contains a list of over 100
additional agreed actions which were meant to
“facilitate compliance with the JSD, to promote
completion of certain 1998 Audit Recommendations, to further
address Case Management even though Plan of Action Desired
Outcomes related to Case Management have been previously
disengaged by an order of the Court and to address certain
aspects of Vocational Rehabilitation.” Appendix A (Doc.
1473) at 1-2. Each action had a deadline, with the last one
scheduled to be completed by the end of fiscal year 2007.
Notably, the additional obligations in Appendix A did not
change or end Defendants' obligations under the JSD and
the Plan of Action. On May 20, 2005, the Court entered an
Order approving Appendix A.
2015 Revised Table IV
2007 and 2010, Plaintiffs filed motions asserting that
Defendants were non-compliant with the JSD, with the Plan of
Action, and with Appendix A by failing to provide the JCMs
adequate health care, a reasonably safe environment, and
supported employment services. The Court responded to the
Plaintiff's first motion by appointing a Rule 706
expert.The Court denied the second motion,
deciding that an evidentiary hearing was necessary to examine
the issues raised by the Plaintiffs. The evidentiary hearing
occurred in June 2011.
the evidentiary hearing, but before the Court issued a
ruling, on November 2, 2011, Plaintiffs filed an opposed
motion asking the Court to appoint a Jackson Compliance
Administrator (JCA). On November 14, 2011, Plaintiffs renewed
their motion for remedial relief. On October 12, 2012, the
Court entered findings and conclusions and an order based on
the evidentiary hearing.
2012 Order, the Court found that Defendants were not in
substantial compliance “with many outstanding health
care, safety, and supported employment obligations” of
the JSD, the Plan of Action, and Appendix A. 2012 Order (Doc.
1930) at 200. The Court granted Plaintiffs' motion to
appoint a JCA, whose role as an administrator would have the
“appropriate expertise and availability to prod
Defendants into substantial compliance.” Id.
On January 11, 2013, the Court vacated the Order Appointing
the 706 Expert (Doc. 1610) and appointed Dr. Sue Gant as the
address violations identified in the 2012 Order, the JCA,
Plaintiffs, and Defendants were to develop a consolidated
plan in the areas of health, safety, and supported
employment. On June 12, 2015, the parties submitted a final
list of objectives in the 2015 Revised Table
IV. Like Appendix A, the 2015 Revised Table
IV did not replace existing decree obligations. In addition
to the obligations defined in the 2015 Revised Table IV,
Defendants had to demonstrate substantial compliance with
still outstanding obligations in the JSD, the Plan of Action,
and Appendix A.
Rule 60(b)(5) Motions
60(b)(5) states that a court may relieve a party from a
judgment, order, or proceeding if “applying [a judgment
or order] prospectively is no longer equitable[.]”
Fed.R.Civ.P. 60(b)(5). The Defendants have filed three
motions under Fed.R.Civ.P. 60(b)(5) seeking to
end the Court's oversight of this class action.
April 2, 1999, Defendants filed their first Rule 60(b)(5)
motion, asking the Court to dismiss the case and vacate the
JSD because they had an Eleventh Amendment defense to the
case and it was no longer equitable that the judgement should
have prospective application. On September 7, 1999, the
Court denied the motion. The Court found that Defendants did
not have an Eleventh Amendment immunity defense to this case
because the JSD “does not invade a ‘special
sovereignty interest' of the State and does not provide
for a form of improper legal relief.” Order (Doc. No.
1132) at 14.
April 26, 2011, the day before the pretrial conference
scheduled to address the upcoming 2011 evidentiary hearing,
Defendants filed their second Rule 60(b)(5) motion, asking
the Court to vacate all existing orders and to end oversight
of the case for the following reasons: 1) Defendants had made
a reasonable effort to comply with the Court's orders; 2)
Defendants had substantially complied with existing orders;
and 3) changed factual circumstances made Defendant's
continued compliance substantially onerous. The Court
suspended its ruling on the 2011 Rule 60(b)(5) Motion until
after the conclusion of the 2011 evidentiary hearing so that
the Defendants could cite evidence from the hearing in their
briefing. See 2012 Order (Doc. 1930) at 12.
Subsequently, the Court “terminated” the 2011
Rule 60(b)(5) Motion, which had not been fully briefed.
August 25, 2015, Defendants filed a third motion under Rule
60(b)(5). As grounds Defendants identified four
changed factual circumstances: 1) Defendants' decree
obligations had grown substantially and compliance had become
increasingly difficult because of the numerosity of the
obligations and because they were not subject to objective
measurement; 2) many of Defendants' obligations had
become outdated; 3) Defendants' had remedied all
constitutional violations; and 4) increased litigation costs
inhibited New Mexico's ability to fund other important
programs. Plaintiffs opposed the motion, contending that the
Rule 60(b)(5) Motion was Defendants' attempt to avoid
compliance. On June 14, 2016, the Court denied the
Rule 60(b)(5) Motion, finding that Defendants had not met
their burden. See Jackson v. Los Lunas Center et.
al., No. CIV 87-839, 2016 WL 9777237 (D.N.M. June 14,
2016) (Jackson II).
Court held that Defendants had not shown that there had been
a significant change in fact that would warrant vacatur of
all orders and decrees and termination of the case.
Jackson II, 2016 WL 9777237 at *14. The Court based
its holding on the following: 1) Defendants never pinpointed
a moment in the case when circumstances had changed; 2)
Defendants did not show that they had provided the JCMs with
the essential purposes of the obligations, specifically
adequate health care, a reasonably safe environment, and
supported employment opportunity; 3) Defendants had not
established that they had remedied all federal statutory and
constitutional violations because, as Defendants conceded,
they had not complied with all consent decree obligations
which flowed directly from the violations found by
Jackson I; and finally, 4) federalism concerns did
not mandate the Court's termination of its oversight
because the State had not fulfilled its obligations under
federal law. Id. at 15-19. Defendants appealed.
Tenth Circuit reversed the Court, finding the Court had
improperly focused on whether Defendants had substantially
complied with the consent decrees, when it should have
considered the broader question of whether “the State
is meeting the requirements of the Fourteenth Amendment and
the Rehabilitation Act by means other than those stated in
the consent decrees.” Jackson v. Los Lunas
Community Program et. al., 880 F.3d 1176, 1206 (10th
Cir. 2018) (Jackson III). The Tenth Circuit found
that two aspects of the Court's ruling required it to
vacate the 2016 Order and to remand for further proceedings.
Id. at 1204. First, the Tenth Circuit found that
“the district court's determination that there are
no chnged circumstances appears to be inconsistent with its
factual findings.” Id. Second, the Tenth
Circuit observed that “federalism concerns are
heightened here because the decrees and the court's
continued oversight have ‘the effect of dictating state
. . . budget priorities.'” Id. at 1205
(quoting Horne v. Flores, 557 U.S. 433, 448 (2009)).
Tenth Circuit gave the Court three issues to examine on
remand: 1) Are the Defendants currently violating class
members' rights under the Fourteenth Amendment and the
Rehabilitation Act; 2) If Defendants are not violating the
class members' rights under federal law, then is the
Defendant's remedy durable; and 3) If Defendants have
implemented a durable remedy, is vacatur of all pertinent
orders and termination of this case appropriate. Id.
April 2, 2018, following the remand, Defendants supplemented
the Rule 60(b)(5) motion. The Court did not set a firm
trial date, but indicated that trial would be set sometime in
September or October of 2019. From April 2018 through
January 2019, the parties conducted fact discovery related to
the Rule 60(b)(5) Motion and Supplement. Ultimately, the
parties determined that “the most efficient and
appropriate resolution of the Motion and this litigation is
to enter a Settlement Agreement to Resolve the
Litigation.” Settlement Agreement (Doc. 2299-1) at
Settlement Agreement resolves all pending litigation disputes
and is meant to “establish a durable remedy” that
will survive the dismissal of the case. See Joint
Memorandum (Doc. 2300) at 1-2. In their Joint Motion for
Final Approval, the parties ask the Court to determine that
the Settlement Agreement is fair, adequate, and reasonable.
parties structured the Settlement Agreement to close the gap
between Defendants' policies and actions and thereby
establish a durable remedy. The Settlement Agreement
contemplates a deadline of 18 months from the Court's
final approval for completion of its terms. The Settlement
Agreement replaces all existing orders of the Court except
Jackson I, the Memorandum and Order approving the
motion to amend the complaint (Doc. 831) and the Memorandum
and Order on class reconfiguration (Doc. 890). However, the
Settlement Agreement incorporates, as of the date of its
entry, current New Mexico state policies, procedures,
practices, and waiver standards. The Settlement Agreement
also introduces a new agreement: the Qualified Provider
Agreement Initiative (QPAI). ...