United States District Court, N.D. California
December 16, 2005.
CONSUMER ADVOCATES RIGHTS ENFORCEMENT SOCIETY, INC. (CARES, INC.), on behalf of California child-support payors; and NICK ARELLANO, individually as a child-support payor and on behalf of all those similarly situated and as guardian ad litem for RYAN ARELLANO, individually as a child supported and on behalf of all those similarly situated, Plaintiffs,
STATE OF CALIFORNIA; COUNTY OF MONTEREY; STEPHEN H. KENNEDY; CURTIS L. CHILD; JAMES L. HANSEN; LISA ORTIZ; BERNIE SIMON and DOES 1 through 50, inclusive, Defendants.
The opinion of the court was delivered by: WILLIAM ALSUP, District Judge
ORDER GRANTING MOTION TO DISMISS
In this action challenging the administration of child-support
payment cases in California under the Temporary Assistance to
Needy Families ("TANF") program, defendants move under Federal
Rule of Civil Procedure 12(b)(6) to dismiss the complaint. The
Court GRANTS defendants' motion to dismiss.
Plaintiff Nick Arellano is Ryan Arellano's non-custodial parent
and guardian ad litem. He has been obliged to pay child support
for Ryan through the Monterey County Department of Child Support Services since November 3, 1993. His case has been
administered pursuant to Title IV-D, 42 U.S.C. 651-669, a
cooperative federal-state program designed to ensure the
availability of child-support enforcement and
paternity-establishment services to states that participate in
the TANF program. As a participant, California receives federal
funds and uses them to make monetary payments, including
child-support, to financially-needy families. The state later
recovers its contributions from the parents responsible for such
obligations. Under the Act, it cannot claim an amount exceeding
the benefits it actually disbursed to the family, however, and
any excess payments must be applied to outstanding obligations.
California must also comply with basic federal goals and
regulations governing its administration of child-support cases.
Beyond meeting these minimum standards, the state has
considerable autonomy in designing its own public-assistance
Plaintiff Arellano made regular reimbursement and child-support
payments to the department pursuant to a court order until
September 1997. Around that time, Ryan's mother requested that
his child-support case be closed; she also waived all outstanding
obligations he owed. Beginning in 1998, disputes emerged between
plaintiff Arellano and the Monterey County Child Support
Division, the local agency that was directly responsible for
administering his case. Specifically, plaintiff Arellano took
issue with the division's notices that he owed substantial sums
of money and practices of intercepting his tax refunds and
levying his bank accounts in order to collect those sums. He was
also aggrieved by the division's failure to provide him with
notice or information as to how he could resolve his disputes or
a statement regarding his reimbursement account.
On February 19, 2005, plaintiff Arellano commenced this action
challenging these alleged administrative errors. He represents a
putative class of other parents allegedly subjected to similar
errors, his son Ryan and similarly-situated children. Consumer
Advocates Rights Enforcement Society, Inc., the other named
plaintiff, is a California non-profit public-benefit organization
that aids in the enforcement of rights of families whose support
is processed through the county/state child-support system.
Defendants are or were previously involved in managing various aspects of child-support services that allegedly
affected or continue to impact the administration of plaintiff
Arellano's and the putative class members' child-support cases.
This action accuses defendants of violating both federal and
state laws by mismanaging child-support cases in California.
Specifically, the complaint alleges: (1) defendants have deprived
plaintiffs of property without due process of law, in violation
of 42 U.S.C. 1983; (2) defendants have deprived plaintiffs of
property without due process of law and infringed on their Fifth
and Fourteenth Amendment rights, in violation of 42 U.S.C. 657,
by collecting and retaining excess child-support payments; (3)
defendants have failed to provide plaintiffs with the requisite
notice and due process protections in handling their accounts;
(4) defendants Hansen and Ortiz, child-support attorneys for the
Monterey County Local Child Support Agency and/or Department of
Child Support Services, fraudulently obtained plaintiff
Arellano's earnings from his employer; (5) defendants have
unlawfully charged interest on undistributed child-support
payments; (6) defendants have breached their fiduciary duty to
plaintiffs; and (7) defendants' fiduciary duty requires them to
provide plaintiffs with an accounting. Plaintiffs request that
the Court direct defendants to redress their alleged
Defendants now move to dismiss the complaint on the following
five grounds: (1) plaintiffs have no private right of action
under Title IV-D; (2) the Eleventh Amendment shields them from
all claims; (3) many of plaintiffs' claims are barred by the
statute of limitations; (4) defendant Child, former director of
California's Department of Child Support Services, is entitled to
qualified immunity as to any damages claims; and (5) the Court
lacks subject-matter jurisdiction over the state claims.
Defendants also assert that plaintiff Arellano lacks standing to bring the action on behalf of Ryan and
that the putative class members lack standing as well.*fn2
Pursuant to Federal Rule of Civil Procedure 12(b)(6), dismissal
for failure to state a claim is proper if it appears beyond doubt
that plaintiff can prove no set of facts to support a claim
entitling him to relief. Dismissal may be based on the lack of a
cognizable legal theory or the absence of sufficient facts
alleged under a cognizable legal theory. Balistreri v. Pacifica
Police Dept., 901 F.2d 696, 699 (9th Cir. 1990). Furthermore,
all material allegations of the complaint are taken as true and
are construed in the light most favorable to the nonmoving party.
Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th
Cir. 1996). If dismissal is granted, plaintiffs are only provided
leave to amend if they can cure the complaint's defects. Noll v.
Carlson, 809 F.2d 1446, 1448 (9th Cir. 1987).
1. PRIVATE RIGHT OF ACTION.
Defendants contend that plaintiffs have no private right of
action against them because the federal laws they allegedly
violated do not unambiguously confer upon plaintiffs any
individual rights. Plaintiffs claim to possess a private right of
action because the relevant laws benefit them, provide them with
clear and enforceable rights and impose binding obligations on
defendants that work to their advantage.
The Supreme Court held in Blessing v. Freestone, 520 U.S. 329
(1997), that custodial mothers of children eligible to receive
child support under Title IV-D lacked a private right of action
against a state under Section 1983 to obtain "substantial
compliance" with the title. It based this decision on the
recognition that Congress did not intend for the law in question
to benefit individual children and custodial parents. The ruling
further identified the following factors as critical to this
determination: (1) whether the right asserted under the statute
is so "vague and amorphous" that enforcement would strain judicial
competence, and (2) whether the provision imposes any binding
obligation on the state, i.e., whether the language is
mandatory or precatory. Id. at 340-41, 343.
In Gonzaga University v. Doe, 536 U.S. 273 (2002), the
Supreme Court clarified Blessing's holdings. The Court ruled
that federal funding provisions do not authorize private
enforcement by a Section 1983 action unless Congress clearly
manifested an unambiguous intent to confer individual rights to
seek relief under those provisions. In making this determination,
courts should consider the "text and structure" of the statutes
at issue to ascertain whether they employ "rights-creating"
language that clearly imparts an "individual entitlement" and
has an "unmistakable focus on the benefitted class." The opinion
also stated that Congress likely did not intend to impart such
entitlements in cases where: (1) statutes have an "aggregate"
focus rather than a focus on whether the needs of any particular
person have been satisfied; (2) statutes speak only in terms of
institutional policy and practice; (3) a statutory provision
references the individual only in the context of describing the
type of policy or practice that will trigger a funding
prohibition; and (4) a provision allows a state entity to avoid a
loss of federal funds through substantial compliance. Id. at
Here, plaintiffs' claims do not allege violations of laws that
confer upon them specific, individualized rights. Plaintiffs
bring this action under the Title IV-D provisions, which are
found in 42 U.S.C. 601-669. The statutory language reveals the
legislation's purpose to provide flexibility to states in
operating programs that will facilitate the care of needy
children in their own homes and encourage two-parent families.
Subdivision (b) of Section 601 explicitly states that the Title
IV-D provisions shall not be interpreted to provide entitlement
to "any individual or family." Accordingly, Title IV-D does not
provide plaintiffs with enforceable personal rights. Even if the
laws have the effect of benefitting them, their failure to
qualify as "intended beneficiaries" of the provisions precludes
them from maintaining a Section 1983 private right of action
against defendants. See Gonzaga, 536 U.S. at 283.
Plaintiffs argue that Sections 608, 654(27), 654b, 657 and 666
provide them with adequate individual entitlements. Section 608
sets forth requirements that state plans must follow and certain prohibitions on their actions.*fn3
Section 654(27) requires state agencies administering the state
plans to operate state disbursement units and enforce support
collections accordingly.*fn4 Section 654b obliges state
agencies to establish such units in order to collect and disburse
child-support payments. It also delineates the specific
procedures the units must follow in order to "ensure prompt
disbursement of the custodial parent's share of
payment."*fn5 Section 657 sets forth rules that govern
states' distribution of child-support payments.*fn6 Section
666 requires that states pass laws and regulations for collecting
support with liens and withholding from income, as well as rules
regarding the establishment of paternity.*fn7 The language
of these statutes is directed towards states not individuals
for purposes of improving child-support administration and
lessening the need for public assistance. Nothing in the statutes unambiguously confers rights upon plaintiffs that
they may enforce. As such, plaintiffs do not possess individual
rights to enforce states' alleged violations of Title IV-D's
provisions. See Sanchez v. Johnson, 416 F.3d 1051, 1057 (9th
Cir. 2005) (language in statute must contain "individually
focused rights creating language").
Plaintiffs also aver violations of notice and due process. In
particular, they maintain that defendants violate these rights in
connection with their levies against plaintiff Arellano's bank
account and interceptions of his tax returns in May, June and
July 2001, as well as June 2002 (Compl. ¶¶ 47, 49, 51).
Plaintiffs request that the Court take judicial notice of the
pleadings, orders and evidence in Barnes v. Healy, a
class-action lawsuit in the United States District Court for the
Eastern District of California that plaintiffs maintain is nearly
identical to the instant action. In Barnes, Judge Shubb found
due process violations for the state defendants' failure to
provide adequate notice and hearing procedures in collecting and
distributing child-support payments. Plaintiffs point out that
the Ninth Circuit upheld Judge Shubb's ruling. See Barnes v.
Healy, 980 F.2d 572 (9th Cir. 1992).*fn8 They assert that
the Barnes ruling compels the Court to find a private right of
action in this case as well.
Trouble is, plaintiffs possess a remedy for these claimed
violations under state law. Various California statutory
provisions ensure that obligors are apprised of any state actions
to unilaterally collect child-support obligations.*fn9 The
state provides a procedure for challenging levies on bank
accounts. Cal. Code of Civ. Proc. § 703.510; see also §
689.030. There is also a specific complaint-resolution process
available to anyone aggrieved by the child-support process.
22 Cal. Code Regs. §§ 120100-120222. These regulations permit
challenges for accounting disputes with the local child-support agency regarding
obligations. Id. § 120201(a)(1)(A) & (C). There are no
analogous federal provisions securing plaintiffs' such
safeguards. Plaintiffs therefore should have sought appropriate
remedies for the alleged notice and due process violations in a
Moreover, the Barnes decision does not govern the instant
case. In Barnes, the Ninth Circuit held that plaintiffs had a
private right of action to allege state violations of due process
based on a specific federal statutory provision,
45 C.F.R. 302.54. That provision set forth state plan requirements that
explicitly afforded individuals annual notice as to the
collection and distribution of their payments. See Barnes,
980 F.2d at 575. The court agreed with plaintiffs that the provision
prevented plaintiffs from effectively evaluating error and
availing themselves of an administrative adjudicatory process.
Id. at 579-81. Following the decision, in 1993, the statute's
notice provisions were revised to ensure more meaningful notice.
The instant action differs considerably. Here, plaintiffs are not
alleging that they were deprived of meaningful notice to which
they are entitled under a specific federal statute governing
child-support administration. They do not assert violations of
particular federally-conferred rights protecting their property
interests as participants in the TANF program. As explained
above, the only federal statutes that they do allege were
violated govern states' management of child-support cases. Under
the recent United States Supreme Court rulings in Blessing and
Gonzaga, these provisions cannot be construed to establish any
individual rights. As such, the Barnes decision fails to
provide plaintiffs' with a private right of action to aver notice
and due process deprivations in federal court.
Furthermore, the complaint fails to delineate which class
members were denied notice and due process. It is also devoid of
any allegations as to how they were so deprived. These
deficiencies preclude this Court from considering their claimed
violations in the aggregate, as plaintiffs have presented them.
Put differently, the state statutes provide due process through
various notices and hearings. If plaintiff Arellano failed to get
a notice (which is not at all clear), it was an aberration. That
does not mean others in the class were inadvertently denied
notice. And, anyone denied notice on an ad hoc basis can seek
remedies in state court. Finally, plaintiff Arellano's claimed notice and due process
violations are barred by the statute of limitations. A personal
injury/civil rights action such as this must be commenced within
two years of the date the liability allegedly accrued. Cal. Code
of Civ. Proc. § 331.5.*fn10 A cause of action accrues when a
plaintiff knew or should have known of the injury that forms the
basis of the action. Kimes v. Stone, 84 F.3d 1121, 1128 (9th
Cir. 1996). The acts underlying plaintiff Arellano's alleged
notice and due process deprivations occurred in May, June and
July of 2001 and in June of 2002. He knew in 1998 that he
disagreed with the county's figures about child-support
obligations it claimed he owed. He knew in 2001 and 2002 that his
tax refunds and bank account were being used to cover those
obligations (Compl. ¶¶ 47-55). Yet, plaintiffs waited until
February 2005 to commence this action. Plaintiff Arellano's
purported notice and due process violations are therefore
Plaintiffs have not alleged a federal claim. Accordingly,
plaintiffs' complaint is DISMISSED with respect to the federal
claims. Defendants' remaining grounds for dismissal of these
claims therefore need not be addressed.
2. FURTHER STATE-LAW CLAIMS.
In light of plaintiffs' lack of a federal claim, this Court
declines to exercise jurisdiction over plaintiffs' state-law
claims pursuant to Title 28 U.S.C. 1367(c)(3).
Title 28 U.S.C. 1367(c)(3) authorizes the Court to decline to
exercise supplemental jurisdiction over a state claim if it has
dismissed all claims over which it has original jurisdiction.
Declining jurisdiction in circumstances like this serves the
objectives of economy, convenience and fairness to the parties,
and comity. See Executive Software N. Am., Inc. v. United States
Dist. Court, 24 F.3d 1545, 1557 (9th Cir. 1994). The Supreme
Court has acknowledged that "[i]n the usual case in which all
federal-law claims are eliminated before trial," these factors
"will point toward declining to exercise jurisdiction over the
remaining state-law claims." Carnegie-Mellon Univ. v. Cohill,
484 U.S. 343, 350 & n. 7 (1998); see also San Pedro Hotel Co., Inc. v. City of L.A., 159 F.3d 470, 478
(9th Cir. 1998) (district court not required to provide
explanation when declining jurisdiction under Section 1367(c)).
Here, dismissal of the state-law claims is proper. Since the
federal claims are dismissed, it is unnecessary for this Court to
decide the remaining state-law claims. In addition, there will be
no duplication of effort to remit the state claims to state
court. This Court has not invested substantial time in
supervising this case. On the other hand, there is currently a
pending action in state court between the state and county
defendants and plaintiff Arellano concerning this matter. As
such, the state court is in a much better position to address the
state-law claims in the first instance. Plaintiffs may either
bring a separate action raising these claims or inject them into
the pending state action with little inconvenience. Either of
these options would constitute a fair and efficient manner by
which plaintiffs could raise these causes of action. This order
thus DISMISSES plaintiffs' state-law claims.
For the reasons stated above, plaintiffs' federal claims and
state causes of action are DISMISSED. Leave to amend is deemed
as futile. Judgment will be entered.
IT IS SO ORDERED.
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