    12-1581
    Mental Disability Law Clinic, Touro Law Center v. Hogan

                        UNITED STATES COURT OF APPEALS
                            FOR THE SECOND CIRCUIT

                                  SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER
FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A
DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING TO A SUMMARY
ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

            At a stated term of the United States Court of Appeals for the Second Circuit, held at the
    Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the
    19th day of March, two thousand thirteen.

    Present:    ROBERT A. KATZMANN,
                BARRINGTON D. PARKER, JR.,
                            Circuit Judges,
                WILLIAM F. KUNTZ, II,
                            District Judge.*
    _____________________________________________

    MENTAL DISABILITY LAW CLINIC, TOURO LAW
    CENTER,

                          Plaintiff-Appellant,

    LIMONI BROWN, as administrator of the Estate of
    Evelyn Hasson, JED ROTHSTEIN, and BRIAN
    DEMARCO,

                          Plaintiffs,

    EDWARD DAVISON,

                          Proposed Intervenor,

                   v.                                                   12-1581



           *
              The Honorable William F. Kuntz, II, of the United States District Court for the Eastern
    District of New York, sitting by designation.
MICHAEL F. HOGAN, in his official capacity as
Commissioner of the New York State Office of
Mental Health,

                        Defendant-Appellee,

GEORGE PATAKI, in his official capacity as
Governor of New York State, JOHN ROE, in his
personal capacity, JOHN DOE, Warden, in his personal
capacity, REGINALD GLOVER, personally, FRANK
TINKER, personally, STEPHEN HODGES, personally,
JOHN KILLILEA, personally,

                  Defendants.**
_____________________________________________

For Plaintiff-Appellant
and Proposed Intervenor:       WILLIAM M. BROOKS, Mental Disability Law Clinic, Jacob D.
                               Fuchsberg Law Center, Touro College, Central Islip, N.Y.

For Defendant-Appellee:        VALERIE FIGUEREDO, Assistant Solicitor General (Barbara D.
                               Underwood, Solicitor General, and Steven C. Wu, Special Counsel
                               to the Solicitor General, on the brief), for Eric T. Schneiderman,
                               Attorney General of the State of New York, New York, N.Y.


       Appeal from the United States District Court for the Eastern District of New York
(Block, J.).

       UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND

DECREED that the judgment of the district court is AFFIRMED.

       Plaintiff-Appellant Mental Disability Law Clinic (“the Clinic”) and Proposed Intervenor

Edward Davison appeal from a March 30, 2012, Memorandum and Order of the United States

District Court for the Eastern District of New York (Block, J.). That Memorandum and Order

granted summary judgment to Defendant-Appellee Michael F. Hogan in his official capacity as

Commissioner of the New York State Office of Mental Health (“OMH”), denied Davison’s


       **
            The Clerk of Court is instructed to amend the official caption as shown above.

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motion to intervene, and denied the Clinic’s motion for class certification. The Clinic contends

that OMH’s policy of filing counterclaims for outstanding care and treatment charges against

patients who sue OMH violates the First and Fourteenth Amendments even though each

counterclaim is limited to the amount of money the patient can recover in his or her lawsuit.

OMH contends that summary judgment is appropriate based on the grounds identified by the

district court and on the additional ground that the Clinic does not have standing to prosecute

this action. We assume the parties’ familiarity with the underlying facts, procedural history of

the case, and issues on appeal.

       We begin with OMH’s challenge to the Clinic’s standing because standing “is the

threshold question in every federal case, determining the power of the court to entertain the suit.”

Denney v. Deutsche Bank AG, 443 F.3d 253, 263 (2d Cir. 2006). The elements of the Article III

standing requirement are well-established. “[A] plaintiff must have suffered an injury in fact that

is distinct and palpable; the injury must be fairly traceable to the challenged action; and the

injury must be likely redressable by a favorable decision.” Id. (internal quotation marks

omitted). OMH argues that the Clinic has not suffered an injury in fact because the Clinic “bases

its assertion of injury solely on the resources that it has expended to pursue affirmative litigation

against OMH’s counterclaim practice—with the majority of those resources spent on this very

case.” Brief for Defendant-Appellee OMH at 20-21 (emphasis omitted). OMH’s reasoning

disregards established Second Circuit precedent.

       This Court has explicitly rejected the argument that litigation expenses are insufficient to

demonstrate an injury in fact for the purposes of Article III standing. See Nnebe v, Daus, 644

F.3d 147, 157 (2d Cir. 2011) (“We recognize that some circuits have read Havens Realty [Corp.

v. Coleman, 455 U.S. 363 (1982),] differently than we read it in Ragin [v. Harry Macklowe Real

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Estate Co., 6 F.3d 898 (2d Cir. 1993),] and have emphasized that litigation expenses alone do

not constitute damage sufficient to support standing. Nevertheless, Ragin remains good law in

this Circuit.” (citations and internal quotation marks omitted)). We have also held that an

organization is not deprived of standing solely because some of the expenses that provide a basis

for standing were dedicated to litigating the very action in which the defendant challenges the

organization’s standing. See Ragin, 6 F.3d at 905. In light of the Clinic director’s affidavit

stating that the Clinic has diverted resources from education and training in order to contest the

OMH practice at issue in this case, we affirm the district court’s holding that the Clinic has

standing to prosecute this action.

       We turn to the Clinic’s First Amendment claim. The Clinic contends that the district

court erred by framing its claim as one for retaliation. To show retaliation in violation of the

First Amendment, a “plaintiff must prove: (1) he has an interest protected by the First

Amendment; (2) defendants’ actions were motivated or substantially caused by his exercise of

that right; and (3) defendants’ actions effectively chilled the exercise of his First Amendment

right.” Curley v. Vill. of Suffern, 268 F.3d 65, 73 (2d Cir. 2001). The Clinic argues that where

the contested behavior is a matter of policy instead of an individual instance of retaliation, a

plaintiff need not demonstrate retaliatory intent.

       We disagree. It is not the scale of a government’s responsive action that renders the

action unconstitutional, but rather the retaliatory intent with which it was implemented and its

chilling effect on the exercise of a First Amendment right. The Clinic points to no case law in

which this Court or any other has declined to apply retaliation doctrine to a plaintiff’s claim that

a government entity responded or will respond in an unconstitutional manner to the exercise of

First Amendment rights. Moreover, adopting the exception to retaliation doctrine that the Clinic

                                                 4
suggests is unreasonable; pursuant to this rule, if a government formulated a policy under which

its attorneys must file a meritorious counterclaim whenever such a potential counterclaim exists,

such a policy would be unconstitutional regardless of the government’s intent.

       Turning to the application of First Amendment retaliation doctrine, the Clinic does not

challenge the district court’s holding that the Clinic failed to produce any evidence

demonstrating that OMH adopted the contested policy with retaliatory intent. We consequently

affirm the district court’s grant of summary judgment to OMH. See Greenwich Citizens Comm.,

Inc. v. Cntys. of Warren & Washington Indus. Dev. Agency, 77 F.3d 26, 30 (2d Cir. 1996) (“[A]t

least for a claim of a First Amendment violation arising in the context of litigation, a

governmental entity alleged to have chilled a litigant’s freedom of speech by filing

counterclaims in response to a complaint must be shown to have acted with retaliatory intent.”).

Having done so, we do not reach OMH’s argument that the Clinic was required to show actual

chill (as opposed to an objectively chilling effect) and that the Clinic failed to do so.

       Next, the Clinic contends that the district court erred in granting judgment to OMH on

the Clinic’s equal protection claim. The Clinic contends that OMH violates the Equal Protection

Clause of the Fourteenth Amendment because it immediately assesses treatment charges against

patients who sue OMH but does not assess treatment charges against patients who sue OMH

employees until after damages, if any, are awarded to those patients. The Clinic’s claim may be

analyzed under the doctrine of either selective prosecution or class-of-one discrimination.

       Selective prosecution plaintiffs “have been required to show both (1) that they were

treated differently from other similarly situated individuals, and (2) that such differential

treatment was based on impermissible considerations such as race, religion, intent to inhibit or

punish the exercise of constitutional rights, or malicious or bad faith intent to injure a person.”

                                                  5
Cobb v. Pozzi, 363 F.3d 89, 110 (2d Cir. 2004) (quoting Harlen Assocs. v. Inc. Vill. of Mineola,

273 F.3d 494, 499 (2d Cir. 2001)). Here, as noted above, the Clinic has produced no evidence

demonstrating that the differential treatment was based on the intent to inhibit or punish the

exercise of the constitutional rights of OMH patients. For the same reason that the Clinic’s First

Amendment claim fails, its selective prosecution claim fails as well.

       Under class-of-one discrimination doctrine, “when it appears that an individual is being

singled out by the government, the specter of arbitrary classification is fairly raised, and the

Equal Protection Clause requires a rational basis for the difference in treatment.” Engquist v. Or.

Dep’t of Agric., 553 U.S. 591, 602 (2008) (internal quotation marks omitted). Here, there is a

rational basis for the disparate treatment. When a plaintiff sues OMH in the Court of Claims,

OMH can file a counterclaim because it is a defendant. When a plaintiff sues OMH employees

in federal or state court, OMH is not a party and cannot file a counterclaim. This difference in

circumstances provides a rational basis for the differential treatment with respect to OMH’s

assessment practices: only because OMH can file a counterclaim in the former category of cases

does it have reason to assess charges while the patient’s lawsuit is still pending.

       The Clinic contends that OMH could file an independent action against a patient as soon

as that patient sues against an OMH employee; OMH would first have to assess charges in order

to file such an action. However, it is rational for OMH to wait and see if a patient is awarded

any damages from the OMH employee. OMH thus avoids spending resources filing a potentially

unnecessary action. Additionally, by waiting, OMH is able to ascertain the amount of damages

awarded and to limit the amount of the claim to that which the patient is capable of paying. See

Acevedo v. Surles, 778 F. Supp. 179, 191 (S.D.N.Y. 1991) (holding that the prior OMH practice

of claiming the full amount of care and treatment charges from patients who file lawsuits against

                                                  6
OMH regardless of the patients’ ability to pay violates the First Amendment and the Equal

Protection Clause). In light of these considerations, we hold that there is a rational basis for the

disparate treatment of patients who sue OMH and patients who sue OMH employees, and we

affirm the district court’s holding with respect to class-of-one discrimination.

       Finally, we turn to Davison’s motion to intervene and the Clinic’s motion to certify a

class. Because we affirm the district court’s judgment with respect to the merits of the claims

asserted by the Clinic, these motions are moot. We consequently affirm the district court’s

denial of both motions.

       We have considered the Clinic’s remaining arguments on appeal and find them to be

without merit. Accordingly, the judgment of the district court is AFFIRMED.

                                           FOR THE COURT:
                                           Catherine O’Hagan Wolfe, Clerk




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