POCONO MOUNTAIN CHARTER SCHOOL; Kinchasa Jackson, on her own behalf and on behalf of her children Y.J. and K.J.; Kenya Williamson, on her behalf and on behalf of her daughter L.J.; Allan Sanabria, on their own behalf and on behalf of their daughter, K.S.; Carrie Sanabria, on their own behalf and on behalf of their daughter K.S.; Kwame Blaize, on his own behalf and on behalf of his children S.B. and L.B.; Molli Rivera, on her own behalf and on behalf of her daughter M.R.; Tiffany Green, on her own behalf and on behalf of her children N.G. and I.G.; Sabrina Muldonavo-Howard, on her own behalf and on behalf of her children B.H. аnd J.H.; Claire Bryant, on her own behalf and on behalf of her children M.B. and M.B.; Diedra Keys, on her own behalf and on behalf of her son S.G., on behalf of all others similarly situated, Appellants v. POCONO MOUNTAIN SCHOOL DISTRICT; Dwight Pfenning, Superintendent in his official and individual capacity; Henry E. Bockelman, President of the Board of Education, in his official and individual capacity; Meg Dilger, Members of the Board of Education, in their official and individual capacities; William Forte, Members of the Board of Education, in their official and individuals capacities; Joseph (Randy) Polinski, Members of the Board of Education, in their official and individual capacities; John H. Davis, Members of the Board of Education, in their official and individual capacities; Ed Mayotte, Members of the Board of Education, in their official and individual capacities; Dorothy Sirolly, Members of the Board of Education, in their official and individual capacities; Ricky D. Smith, Members of the Board of Education, in their official and individual capacities; Michael Stern, Members of the Board of Education, in their official and individual capacities; Jan Nierling, Former members of the Board of Education, in their individual capacities; Leo Colgan, Former members of the Board of Education, in their individual capacities; Stephan Sheloski, Former members of the Board of Education, in their individual capacities; Jeffrey Snyder, Former members of the Board of Education, in their individual capacities; David Pollack, Former members of the Board of Education, in their individual capacities; Stanley Storm, Former members of the Board of Education in their individuаl capacities.
No. 10-4478
United States Court of Appeals, Third Circuit
Aug. 25, 2011
Argued July 14, 2011.
Horizon argues that its guilty plea has “no bearing” on whether PFRS has adequately pleaded corporate scienter because the standards are different—a corporation may be criminally liable under the doctrine of respondeat superior if any of its employees engage in аntitrust activities, while under the securities laws a corporation may only be held liable if persons responsible for making false statements to the public also had scienter.
But this argument begs the question of what plaintiffs are required to plead to state a claim for corporate scienter. Even if we were to adopt such a rule, Horizon‘s guilty plea, together with the exclusions in the non-prosecution agreement, weigh in favor of the scienter of the senior executives. As PFRS points out, “corporations are not charged criminally on the basis of actions of a ‘rogue employee.‘” PFRS Supp. Br. 2 (quoting United States Attorney‘s Manual 9-28.500(A)) (emphasis in original). Rather, “the most important consideration in determining whether to charge an entire corporation criminally is the ‘role and conduct of management.‘” Id. (emphasis in original).
I believe it is more likely than not that the Government chose to pursue criminal liability for Horizon, more than two years after the Puerto Rico managers were imprisoned for their involvement, because it had information indicating that its senior management was involved in the conspiracy. Gilding the lily is not needed here, but there it is.
In conclusion, because I have no doubt that PFRS‘s allegations are sufficient to raise a strong inference of scienter as to the senior executives, I conclude the District Court erred in dismissing PFRS‘s amended complaint as to both the senior executives and Horizon. Indeed, it is hard to imagine a more compelling confluence of circumstantial evidence in support of this conclusion. In holding that the allеgations in this case do not meet the requirements of § 10(b), I believe that the majority is demanding precisely what the Supreme Court told it not to require—a “smoking-gun.” See Tellabs, 551 U.S. at 324, 127 S.Ct. 2499. Thus I respectfully dissent.
Patrick J. Boland, III, Esq., Thomas A. Specht, Esq., Marshall, Dennehey, Warner, Coleman & Goggin, Scranton, PA, John E. Freund, III, Esq. [ARGUED], King, Spry, Herman, Freund & Faul, Bethlehem, PA, for Appellee Pocono Mountain School District.
Before: RENDELL, SMITH and ROTH, Circuit Judges.
OPINION OF THE COURT
RENDELL, Circuit Judge.
This appeal comes to us from a District Court order granting defendant Pocono Mountain School District‘s (“the School District“) Rule 12(b)(6) Motion to Dismiss. The Pocono Mountain Charter School and
We will affirm the District Court‘s dismissal of the individual plaintiffs’ Due Process claim, the Charter School‘s Title VI сlaim, and all plaintiffs’ claims for monetary damages under the Pennsylvania Constitution and for defamation. Because the District Court failed to address plaintiffs’ claims for injunctive relief under the Pennsylvania Constitution, we will remand for it to consider whether those claims have merit. We also will vacate the portion of the District Court‘s order dismissing the individual students’ Title VI claim and direct the Court to grant the individual plaintiffs leave to amend their complaint regarding their Title VI claims on remand. Finally, we will vacate the Court‘s dismissal of plaintiffs’ § 1983 claims, reverse its holding that, under the Pennsylvania Charter School Law, the Charter School is a political subdivision, and remand for the District Court to determine the Charter School‘s capacity to sue under § 1983.
I.
In February 2003, the Pocono Mountain School District granted a charter to the Pocono Mountain Charter School. The Charter School is publicly funded, organized and existing under
Plaintiffs aver that, when the School District renewed the Charter Schоol‘s charter in 2006, it attached sixty-five conditions, which the Charter School had to agree to in order to obtain the renewal. By contrast, plaintiffs aver that Evergreen Charter School (“Evergreen“), which has a predominately Caucasian student body, was only required to agree to thirty conditions when its charter was up for renewal. The District renewed the Charter School‘s charter in 2006 but, two years later, in May 2008, instituted charter revocation proceedings against the Charter School for alleged violations of the Pennsylvania Charter School Law. The District also filed complaints with the Pennsylvania Department of Education (“PA DOE“) regarding the Charter School‘s alleged viola-
On June 2, 2010, the Charter School and the individual plaintiffs filed a complaint against the School District seeking injunctive relief, compensatory damages and punitive damages. The Charter School claimed that the District violated: (1) Title VI of the Civil Rights Act of 1964 by discriminating against the Charter School on the basis of race and national origin; (2) the First Amendment of the U.S. Constitution by discriminating against the Charter School based on the religious affiliation of some of its officers; (3) the Due Process Clause of the Fourteenth Amendment by depriving the Charter School and its students of liberty and process without due process of the law; (4) the Equal Protection Clause of the Fourteenth Amendment by treating the Charter School differently based on the race of its students and the religious affiliation of some of its officers;3 (5) Article I, § 3 of the Pennsylvania Constitution by interfering with School officers’ right to freely worship; and (6) Article I, § VI of the Pennsylvania Constitution by discriminating against plaintiffs in the exercise of their civil rights. In addition, the Charter School brought a defamation claim against the District.
In an order issued on November 23, 2010, the District Court for the Middle District of Pennsylvania granted the District‘s motion to dismiss all the plaintiffs’ allegations. The Charter School challenges the Court‘s dismissal of its § 1983 First Amendment, Equal Protection and Due Process claims and its Title VI and defamation claims. The individual plaintiffs challenge the Court‘s dismissal of its § 1983 Due Process claim, Title VI, and Pennsylvania Constitution claims.4
Our review of a motion to dismiss for failure to state a claim under rule 12(b)(6) is de novo, and we will apply the same standard as the District Court: when considering a motion to dismiss for failure to state a claim, we are required to accept as true all allegations in the complaint and reasonable inferences that can be drawn from them after construing them in the light most favorable to the non-movant. Rocks v. City of Philadelphia, 868 F.2d 644, 645 (3d Cir.1989).
II.
The District Court dismissed the Charter School‘s § 1983 claims for violations of the First Amendment, the Due Process Clause, and the Equal Protection Clause, on the grounds that the Charter School is a political subdivision and, thus, is not entitled to relief under § 1983.5 We disаgree with this ruling and therefore will reverse its dismissal of the Charter
The Court‘s reading of § 17-1714-A of the Pennsylvania Charter School Law to conclude that a charter school is a political subdivision is incorrect.
Section 17-1714-A provides, in relevant part, that:
A charter school established under this act is a body corporate and shall have the powers necessary or desirable for carrying out its charter, including, but not limited to, the power to ... [s]ue and be sued, but оnly to the same extent and upon the same condition that political subdivisions and local agencies can be sued.
It is also incorrect to read § 17-1714-A(a)(2) as saying that charter schools can only sue to the same extent that political subdivisions can sue. The statute does not say this. Rather, the statute states that charter schools may sue and be sued to the same extent that political subdivisions can be sued. It limits only its capacity as a defendant, not as a plaintiff. Thus, under the terms of the statute, a political subdivision‘s power to sue is not necessarily the barometer for determining charter schools’ power to sue.
Therefоre, on remand, the District Court must determine anew whether a charter school can bring suit under § 1983. This presents a thorny issue. The Charter School Law does not directly address this issue, although § 17-1714-A and other sections of the law should be considered in the analysis, as they describe the Charter School‘s relationship to the state. To provide guidance to the District Court on remand, we note the various theories that should be examined in resolving this issue.
It would appear that the central question is to what extent the Charter School‘s association with and relationship to the school district—and, thus, the state6—
In addressing whether the Charter School can bring a § 1983 suit against the state, the District Court should also consider how Williams v. Mayor & City Council, 289 U.S. 36 (1933), 53 S.Ct. 431, 77 L.Ed. 1015, and Coleman v. Miller, 307 U.S. 433, 441 (1939), 59 S.Ct. 972, 83 L.Ed. 1385, which stand for the proposition that a municipal corporation cannot sue the state, and Washington v. Seattle School District No. 1, 458 U.S. 457 (1982), 102 S.Ct. 3187, 73 L.Ed.2d 896, which suggests that a school district can bring a § 1983 suit against the state, bear on this question. Is a Charter School sufficiently analogous to a municipality that it should, under the Williams and Coleman line of cases, be barred from suing the state? If a charter school is sufficiently analogous to a municipality that the Williams and Coleman line of cases preclude it from asserting a § 1983 claim under the contract clause or the Fourteenth Amendment, does that rule extend to a cause of action alleging a violation of the First Amendment? Further, is it significant that the claim in Washington was for racial discrimination in violation of the Equal Protection Clause of the Fourteenth Amendment while the claims in Williams and Coleman were not? How does Washington bear on the question of whether a charter school can sue the sсhool district/the state? Does Washington set down a binding rule that a school district can sue the state? If so, does that rule apply to a charter school, also permitting it to sue the state, or is a public school district‘s relationship with the state sufficiently distinguishable from a charter school‘s relationship with the school district and the state so as to merit a different rule?
The District Court should explore these issues on remand as it decides the question of whether, under Pennsylvania and federal law, a charter school can bring а cause of action under § 1983 against the school district.
III.
The District Court properly dismissed the plaintiffs’ claims for monetary relief under the Pennsylvania Constitution. No Pennsylvania statute establishes, and no Pennsylvania court has recognized, a private cause of action for damages under the Pennsylvania Constitution. See Jones v. City of Phila., 890 A.2d 1188, 1208 (Pa. Commw.2006) (“[N]either Pennsylvania statutory authority nor appellate case law has authorized the award of money damages for violation of the Pennsylvania Constitution.“).
IV.
The District Court dismissed plaintiffs’ claim that the District violated Title VI of the Civil Rights Act of 1964 in denying the benefits of Pennsylvania‘s charter school program to the School and its students and in subjecting the Charter School and its students to discrimination on the basis of race and national origin. We affirm its dismissal of the Charter School‘s Title VI claim. However, as to the individual plaintiffs’ Title VI claim, the District Court should have granted them leave to amend their complaint, and we direct it to do so on remand.
The Supreme Court has recognized a private right оf action to enforce § 601 of the Civil Rights Act of 1964, which prohibits any recipient of federal financial assistance from discriminating against a “person” on the basis of race, color, or national origin in any federally funded program.10 To state such a claim, a plaintiff must plead facts that establish discriminatory intent. See Alexander v. Choate, 469 U.S. 287, 293-94 (1985), 105 S.Ct. 712, 83 L.Ed.2d 661.
We agree with the District Court that the Charter School‘s Title VI claim must fail, because the Charter School does not qualify as a “person” with standing to sue for relief under Title VI. The language of Title VI, which rеfers to a person‘s “race, color or national origin,” suggests that the private right of action Title VI creates does not reach entities like the Charter School. Cf. United States v. Alabama, 791 F.2d 1450, 1457 (11th Cir.1986) (“Title VI provides for a comprehensive scheme of administrative enforcement, and the Supreme Court has implicitly recognized a private right of action for individuals injured by a Title VI violation. Absent any indication of Congressional intent to grant additional rights under this statute to non-private state subdivisions against the state itself, we decline to infer suсh a right of action by judicial fiat.“).
The plaintiffs’ complaint also alleges that the School District denied the benefits of the Pennsylvania charter school pro-
Plaintiffs’ complaint, as the District Court seems to suggest, fails to allege specific facts establishing harm directly or proximately caused by the School District to the students. It does not appear that the allegedly discriminatory conditions imposed on the Charter School directly discriminated against the Charter School students. Though the District Court did not identify it as such, the deficiency it identifies appears to be a standing issue. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992), 112 S.Ct. 2130, 119 L.Ed.2d 351 (setting forth the three requirements of Article III standing: (1) “the plaintiff must have suffered an injury in fact—an invasion of a legally protected interest which was (a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical“; (2) “there must be a causal connеction between the injury and the conduct complained of“; and (3) “it must be likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.“). However, the individual plaintiffs may be able to cure these deficiencies by amendment of their complaint.
Accordingly, we will vacate the portion of the District Court‘s order dismissing the individual students’ Title VI claim and direct the District Court on remand to grant the individual plaintiffs leave to amend their complaint to plead facts establishing that they, as individuаls, were discriminated against on the basis of their race or national origin and that they suffered harm as a result of this discrimination.11
V.
Finally, we will affirm the District Court‘s dismissal of plaintiffs’ defamation claims, although on somewhat different grounds. The District Court dismissed the Charter School‘s defamation claims on two grounds—that, as a political subdivision, it cannot be libeled, and that plaintiffs failed to sufficiently plead defamation.
It is not entirely clear from the complaint whether the District‘s allegedly defamatory statements were made in the School‘s official capacity or in school officials’ personal capacities. If the statements were made in the School‘s official capacity, the school officials who made them are protected by high official immunity under Pennsylvania state law. See
VI.
For the foregoing reasons, we affirm in part, and reverse and remand in part for further proceedings consistent with this opinion.
Notes
No person in the United States shall, on the ground of race, color or natiоnal origin, be excluded from participation in, be denied benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance.