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Coastal Counties Workforce Inc. v. Lepage

United States District Court, D. Maine

January 3, 2018

COASTAL COUNTIES WORKFORCE, INC., Plaintiff,
v.
PAUL R. LEPAGE, et al., Defendants.

          ORDER ON MOTION TO DISMISS AND MOTION FOR A PRELIMINARY INJUNCTION

          JOHN A. WOODCOCK, JR. UNITED STATES DISTRICT JUDGE.

         A local workforce training organization claims the Maine Governor and the Commissioner of the Maine Department of Labor (MDOL) failed to make funds available to it in a manner and time frame that federal law requires. The local workforce organization, Coastal Counties Workforce, Inc. (CCWI), seeks declaratory and injunctive relief under the Workforce Innovation and Opportunity Act (WIOA, the Act) and 42 U.S.C. § 1983, against Governor Paul R. LePage and Commissioner John Butera (Defendants). The Defendants filed a motion to dismiss for failure to state a claim upon which relief may be granted, arguing that WIOA does not provide CCWI a private right of action.

         The Court denies the Defendants' motion to dismiss because it concludes that WIOA does provide CCWI a right enforceable through § 1983: the right to the prompt pass through of federal funds through the state of Maine on a program year basis. The Court grants CCWI's motion for a preliminary injunction because it will likely prevail on the merits, two of the other factors weigh in its favor, and the last, the public policy question, is in equipoise.

         I. BACKGROUND

         A. Procedural History

         On October 24, 2017, CCWI filed a complaint and a motion for temporary restraining order (TRO). Compl. (ECF No. 1); Pl.'s Mot. for a TRO (ECF No. 3). Six days later, on October 30, 2017, the Court held a status conference with the parties. Min. Entry for Telephone Conference (ECF No. 7).

         After the conference, the Court ordered the parties to confer and, if unable to resolve the lawsuit, to discuss scheduling further written submissions and discovery issues. Order (ECF No. 8). The Court indicated that if the parties could not agree on scheduling issues, the Court would issue a scheduling order. Id.

         On November 9, 2017, the Court held a second telephone status conference. Min. Entry for Telephone Conference (ECF No. 12). The Defendants agreed to make certain funds available to CCWI for Program Year 2016 (PY16), but the parties did not fully resolve the lawsuit, with funds for Program Year 2017 (PY17) still contested. With some of the urgency removed, counsel for CCWI agreed to pursue a preliminary injunction, rather than a TRO. Accordingly, the Court dismissed CCWI's motion for a TRO without prejudice on the same day. Order (ECF No. 13). Counsel for the Defendants stated they intended to file a motion to dismiss. On November 13, 2017, the Court issued a scheduling order for the upcoming motions and a testimonial hearing. Pre-Hr'g Scheduling Order (ECF No. 14).

         On November 17, 2017, CCWI filed a motion for a preliminary injunction. Pl.'s Mot. for Prelim. Inj. (ECF No. 16) (Pl.'s Inj. Mot.). On December 6, 2017, the Defendants filed their response in opposition to the motion for a preliminary injunction. Defs. Paul R. Lepage and John Butera's Mem. of Law in Opp'n to Pl.'s Mot. for a Prelim. Inj. (ECF No. 24) (Defs.' Inj. Opp'n). On December 14, 2017, CCWI filed its reply. Pl.'s Reply Mem. of Law in Support of Mot. for Prelim. Inj. (ECF No. 35) (Pl.'s Inj. Reply).

         Also on November 17, 2017, the Defendants filed a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). Defs. Paul R. LePage and John Butera's Mot. to Dismiss (ECF No. 17) (Defs.' 12(b)(6) Mot.). On November 29, 2017, CCWI filed its response in opposition to the Defendants' motion. Pl.'s Opp'n to Defs.' Mot. to Dismiss (ECF No. 20) (Pl.'s 12(b)(6) Opp'n). On December 4, 2017, the Defendants filed their reply. Defs. Paul R. LePage and John Butera's Reply Mem. in Supp. of Mot. to Dismiss (ECF No. 23) (Defs.' 12(b)(6) Reply).

         On December 18, 2017, the Court held an evidentiary hearing and heard oral argument at the close of the hearing. Min. Entry for Hr'g (ECF No. 39).

         B. Statutory Background: WIOA

         Congress passed WIOA in 2014. Workforce Innovation and Opportunity Act, Pub. L. No. 113-128, 128 Stat. 1425 (2014). The purposes of WIOA include “increas[ing] . . . access to and opportunities for the employment, education, training, and support services” and the “alignment of workforce investment, education, and economic development systems in support of a comprehensive, accessible, and high- quality workforce development system.” 29 U.S.C. § 3101. The Act authorizes appropriations for fiscal years 2015 to 2020 and directs those funds to state and local workforce development efforts. Id. § 3181.

         To receive the federal funds, the Act requires local areas and states to set up a series of boards to administer the program. A state's governor establishes a state workforce development board (SWDB), composed of the governor, a member of each chamber of the state legislature, business leaders, and officials from labor organizations. Id. § 3111(a)-(b). The state board assists the governor in developing a state plan, as well as in overseeing the workforce development system, and in identifying aspects in need of improvement. Id. § 3111(d). A governor must submit a state plan on a four-year basis to the Secretary of Labor for approval.[1] Id. § 3112(a), (c). A state plan must include details about the workforce development system, including how the federal funds will be used, the local areas designated in the state, and performance and accountability measures. Id. §§ 3112(b), 3141.

         A governor must designate local areas to administer the education and training programs within a state based on considerations such as labor market factors, regional economic development, and the availability of resources. Id. § 3121(b). A governor and local chief elected officials, like county commissioners, must establish local workforce development boards. Id. § 3122(a), (c). Local boards must be composed of individuals from groups like local business leaders, officials from labor organizations, and members of economic and community development entities. Id. § 3122(b). Each local board submits a comprehensive local plan to the governor for approval on a four-year basis. Id. § 3123(a). The local plan outlines how designated entities and providers within the local area will implement the workforce development programs and carry out training, and specifies performance and accountability measures. Id. §§ 3123(b), 3141.

         Once a governor approves the local plans, the Secretary approves the state plan, and Congress appropriates federal funds, the Secretary makes allotments to each state based on funding formulae specified in the statute. Id. §§ 3162, 3172. A governor may reserve certain percentages of the funds for statewide purposes but then must make allotments to each of the local areas based on statutory funding formulae. Id. §§ 3163, 3173. The funds “shall be available for obligation only on the basis of a program year” running from July 1 to the following June 30. Id. § 3249(g). Funds the states and local areas receive during one program year “may be expended during that program year and the succeeding program year.” Id.

         The statute requires the “prompt allocation of funds” at each level of administration. Id. § 3242. All funds the Secretary allots to the states “shall be allotted within 45 days after the date of enactment of the Act appropriating the funds.” Id. § 3242(c). The funds a governor is required to allot to the local area “shall be made available . . . for a local area not later than 30 days after the date the funds are made available” to the governor “or 7 days after the date the local plan for the area is approved, whichever is later.” Id. § 3242(e).

         C. The Facts[2]

         1. The Parties and Maine's Workforce Training System

         Paul R. LePage is the Governor of the state of Maine. Compl. ¶ 8. John Butera is the Commissioner of MDOL. Id. ¶ 9. CCWI is a Maine non-profit corporation with a principal place of business in Brunswick, Maine. Id. ¶ 7.

         There are three Local Workforce Investment Areas in Maine, each with its own Local Workforce Development Board. Id. ¶ 14; Stipulation of Facts ¶¶ 9-11 (ECF No. 32) (Stipulations). The local areas consist of the Coastal Counties Region (York, Cumberland, Sagadahoc, Lincoln, Waldo, and Knox Counties); the Northeastern Region (Aroostook, Piscataquis, Penobscot, Hancock, and Washington Counties); and the Central/Western Region (Somerset, Franklin, Oxford, Androscoggin, and Kennebec Counties). Compl. ¶ 15; Stipulations ¶¶ 9-11. Under the current system, the local boards and the local chief elected officials delegate the administration and oversight of WIOA funds to an entity created for that purpose for each of the three local areas (the workforce groups). Compl. ¶ 22; Stipulations ¶¶ 12-13. The workforce groups are largely or entirely funded by money Congress allocated under WIOA. Compl. ¶ 23.

         CCWI is the entity the local board and the chief elected officials created to oversee the use of WIOA funds for the Coastal Counties Region. Compl. ¶ 27; Stipulations ¶ 13. CCWI uses the allocation of approximately $3 million each year to fund programs designed to help dislocated workers, low income adults, and young adults with barriers to employment throughout the Coastal Counties Region. Compl. ¶ 28.

         By letter dated June 6, 2016, the former Commissioner of MDOL, writing as the designee for Governor LePage, confirmed that CCWI had been granted local area designation for the Coastal Counties Region. Compl. ¶ 29. By letter dated September 12, 2016, the former Commissioner of the MDOL granted conditional approval of the Coastal Counties Workforce Board's 2016-2020 local plan. Id. ¶ 30; Stipulations ¶ 16. This conditional approval remains in effect today. Id. CCWI has satisfied the conditions MDOL imposed. Id. USDOL approved Maine's State Plan on October 20, 2016. Stipulations ¶ 4.

         Part of the process for making WIOA funds available to the local workforce groups is the execution of an agreement for each program year between the state of Maine and each local workforce group. Compl. ¶ 31. For all previous years in which MDOL distributed WIOA funds, the local workforce group agreements covered the entire program year. Id. ¶ 32. The local workforce groups say they require agreements for full program years in order to effectively plan and operate their programs. Id. ¶ 34. As a general practice, WIOA funds are expended on a FIFO (first in, first out) accounting basis, as to particular types of expenditures. Stipulations ¶33. Before expending PY17 WIOA funds, CCWI's service provider must expend its PY16 funds; similarly before expending its PY17 WIOA administrative funds, CCWI must expend its PY16 administrative funds. Id.

         2. Defendants' Dissatisfaction with the Current Administration of the Workforce Development System

         Governor LePage has repeatedly sought to eliminate the local areas and local boards in favor of a single state-wide system. Id. ¶ 17. In November, 2012, the Secretary of the United States Department of Labor (USDOL) rejected Governor LePage's plan to re-designate the local areas to more closely match Maine's Chamber of Commerce regions, under WIOA's predecessor statute, WIA. Pl.'s Ex. 1. In a letter dated July 11, 2017, Governor LePage wrote to Secretary Acosta, requesting that Maine be granted “single State local area designation.” Id. ¶ 18; Joint Ex. 1. This was at least the second time the Governor had made a similar request. Compl. ¶ 19. By letter sent on August 30, 2017, the Secretary rejected the Governor's request because it was not permissible under WIOA. Id. ¶ 20; Joint Ex. 2. In September, 2017, the Governor sought to remove the State from the funding process in order to have the federal agency fund the local areas directly. Pl.'s Ex. 3-4.

         3. The Conflict over Program Year 2016 and 2017 Funds

         For PY16, the Secretary made $9, 372, 636 in WIOA funds available to Governor LePage. Compl. ¶ 35; Notice Regarding PY 2016 WIOA Allotments, 81 Fed. Reg. 22640 (April 18, 2016). The PY16 funds were made available to Governor LePage in June 2016. Id. ¶ 36. On July 7, 2016 the state of Maine entered into a contract with CCWI for CCWI's full share of the PY16 WIOA funds. Id. ¶ 37; Joint Ex. 10; Stipulations ¶ 18.

         For PY17, the Secretary made $8, 393, 050 in WIOA funds available to Governor LePage. Compl. ¶ 38; Notice Regarding PY 2017 WIOA Allotments, 825 Fed. Reg. 27529 (June 15, 2017). The Secretary made the PY17 funds available to Governor LePage in a series of awards on June 22, 2017, July 14, 2017, and October 24, 2017. Compl. ¶ 39; Stipulations ¶¶ 19-21.

         On July 7, 2017, MDOL offered CCWI a partial-year agreement for some of the PY17 funds. Compl. ¶ 43; Defs.' Ex. 1 ¶ 9-10; Defs.' Ex. 14 at 2. On August 2, 2017, CCWI sent a letter to Commissioner Butera to “formally complain/grieve” a violation of WIOA because MDOL had not yet made a portion of the PY17 funds available on a full program year basis. Defs.' Ex. 11. On August 15, 2017, MDOL found no contractual violation because it believed partial year contracts were permissible under WIOA, based on guidance from a USDOL grant officer. Defs.' Ex. 12. On September 20, 2017, CCWI wrote to the Secretary in order to “complain/grieve” MDOL's decision. Defs.' Ex. 13.

         On September 7, 2017, Governor LePage wrote to the Secretary and stated that “Maine is no longer participating in the WIOA Title 1B program. We ask that no more of these funds be sent to the Maine Department of Labor.” Id. ¶ 44; Joint Ex. 3. On September 20, 2017, Secretary Acosta responded that he “hope[d] to continue to work with” Governor LePage and suggested “two vehicles” for the Governor to consider, redesignation of the local areas within the State and seeking congressional action to modify WIOA. Joint Ex. 4.

         By letter dated October 23, 2017, MDOL purported to terminate CCWI's contract for the remaining PY16 funds. Compl. ¶ 41; Joint Ex. 5. That letter indicated that MDOL would only reimburse costs CCWI incurred until November 30, 2017. Id. Three days later, on October 26, 2017, shortly after CCWI filed this lawsuit, the Defendants rescinded the October 23, 2017 letter and agreed to make the PY16 WIOA funds available to the local workforce groups as before. Joint Ex. 6-7.

         Governor LePage, either personally in his official capacity, or through his designees, including Commissioner Butera, has refused or otherwise failed to make the PY17 WIOA funds available in their entirety to the three local workforce groups. Compl. ¶ 42. The Defendants have refused to issue contracts with the local workforce groups for all of PY17. Id. ¶ 43. Instead, on November 1, 2017, MDOL offered to enter into a funding agreement with the local areas, conditioned upon submitting a budget that complied with a new sixty-percent training spending requirement. Stipulations ¶ 26; Joint Ex. 8.

         A prior State Plan contained a similar forty-percent training requirement, but the current State Plan rescinded that policy, and the sixty-percent requirement is not in the current State Plan. Stipulations ¶¶ 29-30. On December 1, 2017, the State Board met, considered the sixty-percent requirement at the Governor's request, and rejected the policy. Stipulations ¶ 31.

         Governor LePage directed and approved of all actions taken by state officials with regards to: (1) the PY16 and PY17 funds allocated to the local boards, including CCWI; (2) all efforts to change Maine's participation in WIOA; (3) all efforts to change the administrative structure of the WIOA program in Maine; and (4) all efforts to impose a sixty-percent minimum training expenditure requirement on the local boards. Stipulations ¶ 25. Commissioner Butera, with authority from the Governor, directed and approved of all actions taken by state officials with regard to the issuance of partial year award agreements for PY17. Id.

         4. The Impact of the Funding Conflict

         Since July 1, 2017, CCWI has continued to submit expenses and draw down 2016 funds. Stipulations ¶ 22. On October 26, 2017, approximately $731, 153.56 remained of the PY16 funds allocated to CCWI. Id. As of November 30, 2017, $583, 715.28 remained available to CCWI from PY16 funds. Stipulations ¶ 23. Since it filed this lawsuit on October 24, 2017, CCWI has drawn down funds in the amount of $218, 880 from PY16 funds. Stipulations ¶ 24.

         The PY16 WIOA funds are keeping CCWI's doors open and allowing it to offer limited services to workers and businesses through this first half of PY17. Id. ¶ 54. If the PY17 WIOA funds are not promptly made available, CCWI will be forced to cease all workforce training operations under WIOA by the end of January 2018, and CCWI's other independent funding will run out later in the year, forcing it to shut down completely by the end of June 2018. Id. ¶ 55; see also Pl.'s Inj. Mot. at 6 (ECF No. 16). WIOA funds represent seventy-five-percent of CCWI's budget for the PY17 period. Compl. ¶ 55. The remaining twenty-five-percent comes from stand-alone grants which support programs that rely on the infrastructure funded by WIOA funds. Id.

         Last year, CCWI received 49, 213 customer visits through the local CareerCenters and affiliate offices. Id. ¶ 47. Of those visits, 16, 512 customers required additional workforce services. Id. ¶ 48. In PY16, CCWI assisted 564 workers in obtaining employment at an average annual wage of $29, 456, adding approximately $16.7 million to the state's economy. Id. ¶ 49. There are currently approximately 908 adult, youth, and dislocated workers enrolled in workforce intensive services or training. Id. ¶ 50. A majority of these visits and services will be adversely affected or completely eliminated if the local workforce groups lose funding. Id. ¶¶ 46, 51. Approximately 500 Maine employers will be adversely affected by not being able to obtain trained workers or receive business services. Id. ¶ 52. Other grants involving non-WIOA funds that are administered by CCWI for the benefit of Maine businesses and employers will be terminated should CCWI cease operating. Id. ¶ 53.

         CCWI has already begun curtailing the services it is funding for workers and employers. Id. ¶ 56. Service providers for CCWI and the other local workforce groups are beginning to lay off employees. Id. ¶ 57. If forced to shut down its operations, CCWI anticipates that its personnel will seek other job opportunities, it will lose its other grants, and that it will be difficult, if not impossible, to resume operations even if the funds are made available at a later date. Id. ¶ 58. CCWI anticipates the withholding of the funds to directly result in approximately thirty workforce system jobs lost in the Coastal Counties Region and seventy-five jobs statewide. Id. ¶ 59. CCWI alleges this will cause individual harm to those workers, and a greater harm though the effect on the workforce training system. Id. Once shut down, CCWI alleges the workforce training system will be very difficult and expensive to rebuild. Id.

         CCWI alleges that the Defendants' attempt to reject Title I funds from WIOA could adversely affect the ability of the State's workforce system to administer the other federal programs, like Adult Education (Title II), Employment Services (Title III), and Vocational Rehabilitation (Title IV). Id. ¶ 60. CCWI claims that this could in turn place the state of Maine out of compliance with the mandates set forth by USDOL and WIOA, and that the loss of Title 1 funding under WIOA will also cause harm to the financial sustainability of multi-agency career centers, and other multi-program service delivery sites that depend on it to contribute to fixed operating expenses. Id. ¶¶ 60-61.

         II. LEGAL STANDARDS

         A. Motion to Dismiss

         Rule 12(b)(6) requires dismissal of a complaint that “fail[s] to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). Under the general pleading standards, a complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). In Ashcroft v. Iqbal, 556 U.S. 662 (2009), the United States Supreme Court elaborated on this pleading standard in the context of a motion to dismiss: “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” 556 U.S. at 678 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).

         The First Circuit explained that “[t]he plausibility inquiry necessitates a two-step pavane.” García-Catalán v. United States, 734 F.3d 100, 103 (1st Cir. 2013) (citing Rodríguez-Reyes v. Molina-Rodríguez, 711 F.3d 49, 53 (1st Cir. 2013)). “First, the court must distinguish ‘the complaint's factual allegations (which must be accepted as true) from its conclusory legal allegations (which need not be credited).'” Id. (quoting Morales-Cruz v. Univ. of P.R., 676 F.3d 220, 224 (1st Cir. 2012)). “Second, the court must determine whether the factual allegations are sufficient to support ‘the reasonable inference that the defendant is liable for the misconduct alleged.'” Id. (quoting Haley v. City of Boston, 657 F.3d 39, 46 (1st Cir. 2011) (quoting Iqbal, 556 U.S. at 678)).

         B. Motion for a Preliminary Injunction

         “A preliminary injunction is an extraordinary and drastic remedy that is never awarded as of right.” Peoples Fed. Sav. Bank v. People's United Bank, 672 F.3d 1, 8-9 (1st Cir. 2012); Voice of the Arab World, Inc. v. MDTV Med. News Now, Inc., 645 F.3d 26, 32 (1st Cir. 2011); accord Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 24 (2008). When deciding whether to grant a motion for preliminary injunction, the Court must carefully weigh four factors:

(1) the likelihood of success on the merits; (2) the potential for irreparable harm [to the movant]; (3) the balance of the relevant impositions, i.e., the hardship to the nonmovant if enjoined as contrasted with the hardship to the movant if no injunction issues; and (4) the effect (if any) of the court's ruling on the public interest.

Esso Standard Oil Co. v. Monroig-Zayas, 445 F.3d 13, 17-18 (1st Cir. 2006) (quoting Bl(a)ck Tea Soc'y v. City of Boston, 378 F.3d 8, 11 (1st Cir. 2004)).

         “The party seeking the preliminary injunction bears the burden of establishing that these four factors weigh in its favor.” Id. at 18. However, “[t]he sine qua non of this four-part inquiry is likelihood of success on the merits: if the moving party cannot demonstrate that he is likely to succeed in his quest, the remaining factors become matters of idle curiosity.” New Comm. Wireless Servs., Inc. v. SprintCom, Inc., 287 F.3d 1, 9 (1st Cir. 2002); see Sindicato Puertorriqueño de Trabajadores v. Fortuño, 699 F.3d 1, 7 (1st Cir. 2012) (confirming that this factor is the “most important part of the preliminary injunction assessment”) (citation omitted). Ultimately, “trial courts have wide discretion in making judgments regarding the appropriateness of [preliminary injunctive] relief.” Francisco Sánchez v. Esso Standard Oil Co., 572 F.3d 1, 14 (1st Cir. 2009).

         III. THE PARTIES' POSITIONS

         A. Likelihood of Success on the Merits

         CCWI argues that it is likely to prevail on the merits because the Defendants are depriving it “of a right secured by the ‘laws' of the United States” that is enforceable under § 1983. Pl.'s Inj. Mot. at 8-10. The Defendants respond that CCWI is unlikely to prevail on the merits because WIOA does not confer a “right” on CCWI that is enforceable under § 1983. Defs.' Inj. Mot. at 10-15. The Defendants also respond that, if CCWI has a right under the statute, they have not violated that right because they made offers and CCWI refused to execute an agreement. Id. at 15-17. CCWI replies that the Defendants have violated their right because the State may not impose unilateral requirements on WIOA funds. Pl.'s Inj. Reply at 1-7.

         The parties' arguments on the first prong of the preliminary injunction analysis are inextricably bound up in the question of whether CCWI has a right of action against the Governor and the Commissioner, which implicates the arguments the parties have made in their memoranda regarding the motion to dismiss.

         1. Governor LePage and Commissioner Butera's 12(b)(6) Motion

         The Defendants argue that CCWI fails to state a claim because their lawsuit is based on the erroneous assumption that WIOA creates a federal right enforceable through 42 U.S.C. § 1983. Defs.' 12(b)(6) Mot. at 2. The Defendants point out that when a plaintiff sues “under a federal statute that does not confer an express or implied cause of action, the lawsuit is properly dismissed for failure to state a claim” under Federal Rule of Civil Procedure 12(b)(6). Id. (citing, among others, Arroyo-Torres v. Ponce Federal Bank, F.B.S., 918 F.2d 276, 280 (1st Cir. 1990)). The Defendants contend that all the most recent Supreme Court cases found the statute in question did not confer a right in similar circumstances. Id. at 6-8 (citing Armstrong v. Exceptional Child Center, Inc., 135 S.Ct. 1378 (2015); Gonzaga University v. Doe, 536 U.S. 273 (2002); Blessing v. Freestone, 520 U.S. 329 (1997)).

         The Defendants further assert that alternate enforcement mechanisms in WIOA indicate that Congress did not intend to create a private right enforceable through § 1983. Id. at 8, 10 (citing Middlesex County Sewerage Authority v. National Sea Clammers Ass'n, 453 U.S. 1 (1981)). The Defendants insist that the funds are subject to “negotiation of a contract” which makes any entitlement CCWI might possess “vague and amorphous” and thus unenforceable. Id. at 11. The Defendants also maintain that the local workforce boards are not the intended beneficiaries of WIOA, and are at most “incidental beneficiaries.” Id.

         The Defendants next point to several cases decided under the predecessor statute to WIOA, the Workforce Investment Act, Pub. L. No. 105-220, 112 Stat. 936 (1998) (WIA). Defs.' 12(b)(6) Mot. at 8-9 (citing Brown v. Rotenberg, No.15-CV-6678 EAW, 2017 WL 3332241 (W.D.N.Y. August 3, 2017); Machie v. Nguyen, 824 F.Supp.2d 146, 151 (D.D.C. 2011); Municipality of San Juan, et al., v. Human Resources Occupational Development Council, 371 F.Supp.2d 52 (D.P.R. 2005)). The Defendants concede that a “limited number of cases allow[ed] a plaintiff to pursue a § 1983 claim under WIA, ” but the Defendants distinguish those cases on the basis that they “involved claims of political discrimination” in violation of provisions that are markedly different than the one CCWI asserts. Id. at 9 (citing Caraballo Seda v. Javier Rivera, 261 F.Supp.2d 76 (D.P.R. 2003)).

         The Defendants also argue that any claim that might have existed is now moot as to the PY16 funds, which were made available without restriction shortly after CCWI filed this lawsuit. Id. at 5.

         2. CCWI's 12(b)(6) Opposition

         CCWI recites the three factors to determine whether a statute creates a right enforceable under § 1983. Pl.'s 12(b)(6) Opp'n at 2-3 (citing Colon-Marrero v. Velez, 813 F.3d 1, 38 (1st Cir. 2016); Blessing, 520 U.S. at 340-41).

         CCWI argues that the first factor, whether the provision was intended to benefit the plaintiff, weighs in favor of finding a right. Id. at 3-4. CCWI argues that 29 U.S.C. § 3242 uses language with an “unmistakable focus on the benefited class” when it said that funds shall be made available “for a local area.” Id. (quoting Gonzaga, 536 U.S. at 284) (emphasis in original); also citing Wilder v. Va. Hosp. Ass'n, 496 U.S. 498, 468-469 (1990); Wright v. Roanoke Redevelopment & Housing Authority, 479 U.S. 418 (1987)). CCWI distinguishes cases where the Supreme Court did not find an individual right because in its view the provisions had an aggregate focus, suggesting they were “not concerned with whether the needs of any particular person have been satisfied.” Id. at 3-5 (quoting Gonzaga, 536 U.S. at 288; also citing Blessing, 520 U.S. at 342-344; Suter v. Artist M., 503 U.S. 347, 363 (1992)).

         CCWI characterizes the cases under WIA, the predecessor statute to WIOA, as “inapt.” Id. at 7. CCWI points out that WIA did not contain the provision at issue in this case, and that none of those cases addressed similar issues of funding pass-through requirements. Id. at 7-8. Instead, CCWI analogizes to a recent decision from another circuit finding an individual right. Id. at 8-9 (citing D.O. v. Glisson, 847 F.3d 374 (6th Cir. 2017)).

         CCWI contends that the other factors used to determine whether a provision confers a right weigh in its favor. Id. at 9-10. CCWI claims the statute is not “so ‘vague and amorphous' that its enforcement would strain judicial competence” because it only requires a court to decide a binary question, whether the funds have been made available or not. Id. at 9. CCWI also emphasizes that the provision uses mandatory rather than precatory terms, thereby imposing a binding obligation. Id. at 9-10.

         CCWI explains that once a court finds a provision confers a right, that right is presumptively enforceable under § 1983 and this presumption is only overcome if Congress indicated an intent to foreclose that remedy. Id. at 10-11. CCWI maintains that WIOA does not contain any comprehensive alternate enforcement mechanism resembling the ones courts have found sufficient to displace the availability of § 1983 relief. Id. at 11-13.

         CCWI argues its claim is not moot as to the PY16 funds because the “voluntary cessation of a challenged practice does not deprive a federal court of its power to determine the legality of the practice.” Id. at 13-15 (quoting Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 189 (2000)).

         Finally, CCWI insists that this case is not a contract dispute, where the parties have the power to make offers with conditions attached and decline to enter an agreement if they do not agree to those conditions. Id. at 15-18. CCWI emphasizes that, despite the use of the term “contract” and “sub-recipient award agreement, ” the state has no authority to create an offer with additional conditions or decline to enter into an agreement. Id. at 16-18. CCWI claims “the State is responsible for ensuring that program funds are spent according to the requirements of WIOA, the State Plan, the Local Plan, and applicable federal grant accounting regulations” but has no further discretion in making funds available at the subaward stage. Id. at 17-18.

         3. Governor LePage and Commissioner Butera's 12(b)(6) Reply

         The Defendants argue that the intended beneficiaries of WIOA are the “individuals needing employment, education, training and support services, ” not the local workforce entities, and Congress denied the beneficiaries any right or entitlement to service. Defs.' 12(b)(6) Reply at 2-3.

         The Defendants submit that the analytical framework set forth in earlier cases from the Supreme Court relied upon by CCWI have been “significantly undercut, if not ...


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