Anderson & Shah attorneys Roshan D. Shah and Erin Donegan successfully represented several school districts in a class action lawsuit in the Third Circuit Court of Appeals. The court affirmed dismissal of a class action lawsuit alleging school districts discriminated against special education students by switching to a virtual format during the COVID-19 pandemic. Plaintiffs, a group of parents, sued several school districts on the basis that the format change constituted an unlawful modification of their children’s individualized education program (IEP). They asserted claims for violations of the Individuals with Disabilities Education Act (IDEA), the New Jersey Law Against Discrimination (LAD), the Americans with Disabilities Act, and the Substantive Due Process and Equal Protection clauses. In addition, the plaintiffs asserted the school districts engaged in racketeering activity by falsely certifying they were complying with the IDEA so they could obtain federal funds under the IDEA.

After the District Court dismissed plaintiffs’ suit for failure to exhaust administrative remedies and lack of standing, the plaintiffs appealed. The Third Circuit Court of Appeals affirmed the dismissal. In doing so, the court rejected plaintiffs’ contention that they were excused from exhausting administrative remedies based on the systemic exception. The court also rejected plaintiffs’ argument that they could exhaust administrative remedies after filing suit. Finally, addressing the United States Supreme Court’s recent decision in Perez v. Sturgis Pub. Sch., 598 U.S. 142 (2023)– which held that exhaustion of IDEA administrative remedies were unnecessary where plaintiff sought monetary relief– The Third Circuit Court of Appeals the court held that plaintiffs had failed to adequately plead they sought compensatory damages.

The court also dismissed the RICO claims, finding that plaintiffs lacked standing. Even if the school districts had improperly obtained federal funds by misstating their compliance with the IDEA, the court found that the injury, if any, belonged to the United States government, not plaintiffs.

The case is captioned Carmona v. N.J. Dep’t of Ed., Civil Action No. 22- 2874 (3d Cir. 2023).