Hills v. Roberts, 1:18-cv-01240

Background

Plaintiffs Hills, Washington, and Dhakal are individuals who obtained favorable SSA or OTDA fair‑hearing determinations entitling them to retroactive New York State Supplement Program (SSP) benefits, but either received denials or no meaningful compliance from the OTDA/SSP.
New York’s SSP is a state‑administered supplement to federal SSI; SSP eligibility is generally determined from SSA data (State Data Exchange), and OTDA fair‑hearing decisions are binding with regulatory compliance obligations.
Each plaintiff received a Decision After Fair Hearing directing the SSP to re‑evaluate and issue written determinations and to comply immediately, yet the SSP responded (or the OTDA Compliance Unit closed complaints) without providing retroactive payments or a written explanation of compliance actions.
Plaintiffs sued under 42 U.S.C. § 1983, asserting multiple Fourteenth Amendment procedural due process claims: inadequate denial notices, failure to provide benefits after favorable hearings, disregarding hearing decisions, closing compliance complaints prematurely, and failing to document compliance actions.
Defendant moved to dismiss under Rule 12(b)(6), arguing (1) Article 78 state‑court review provides an adequate post‑deprivation remedy and (2) federal courts should abstain under Burford because the claims implicate a complex state regulatory scheme. The court denied the motion.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether availability of Article 78 relief bars Plaintiffs’ §1983 procedural due process claims	Plaintiffs say the deprivation stems from agency system/procedure (not random acts), so Article 78 does not automatically satisfy due process and federal review is appropriate	Defendant says Article 78 offers an adequate post‑deprivation remedy; thus Plaintiffs fail to state a federal due process claim	Denied dismissal: because Plaintiffs plausibly alleged an established agency procedure caused the deprivation, Article 78 does not automatically bar §1983 claims; Mathews balancing is required to decide what process is due
Whether the alleged deprivations are random/unauthorized acts or part of an established state procedure	Plaintiffs contend patterns of identical denials and compliance‑unit responses show an agency‑wide procedure	Defendant implies occurrences were remediable via individual state review and thus post‑deprivation remedies suffice	Court found plaintiffs’ factual allegations plausibly show agency‑wide procedures rather than mere random acts; this forecloses dismissal on that basis
Whether Burford abstention requires dismissal of the federal action	Plaintiffs argue constitutional review of due‑process procedures does not require intrusive interpretation of SSP regulatory scheme and federal courts can adjudicate due‑process adequacy	Defendant argues the SSP regulatory scheme is detailed and of traditional state concern, so federal interference would disrupt state policy	Denied dismissal: although the SSP scheme is specific and of state concern, the Court found adjudicating whether federal due process was provided would not require impermissible intrusion into state regulatory decisions and Burford abstention was inappropriate
Scope of relief or supervision over state administrative process	Plaintiffs seek injunctive relief ordering payment and reworking compliance processes	Defendant did not press a separate merits or remedial argument in the motion to dismiss	Court did not rule on the merits of relief; noted that if Plaintiffs seek merits reversal or detailed federal oversight of state hearing processes, abstention or other limits may be implicated later

Key Cases Cited

Mathews v. Eldridge, 424 U.S. 319 (1976) (sets out the three‑part balancing test for what process is due under the Fourteenth Amendment)
New Orleans Pub. Serv., Inc. v. Council of New Orleans, 491 U.S. 350 (1989) (explains Burford abstention: federal courts should decline when timely state review exists and federal review would disrupt important state policies)
Hellenic Am. Neighborhood Action Comm. v. City of New York, 101 F.3d 877 (2d Cir. 1996) (distinguishes deprivations by established state procedures from random/unauthorized acts for due‑process/post‑deprivation remedy analysis)
Rivera‑Powell v. New York City Bd. of Elections, 470 F.3d 458 (2d Cir. 2006) (explains when Article 78 is an adequate post‑deprivation remedy and when established procedures require more process)
Hachamovitch v. DeBuono, 159 F.3d 687 (2d Cir. 1998) (articulates Burford factors and holds federal due‑process claims not necessarily barred by state regulatory complexity)
Liberty Mut. Ins. Co. v. Hurlbut, 585 F.3d 639 (2d Cir. 2009) (applies Burford abstention factors in the Second Circuit)
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading standard: complaint must state a plausible claim)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (clarifies that courts need not accept legal conclusions as true for pleading purposes)