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Louise B. v. Coluatti

decided: September 28, 1979.



Before Adams, Rosenn and Higginbotham, Circuit Judges.

Author: Higginbotham


Appellants have challenged, on substantive and procedural grounds, a Pennsylvania program pursuant to which state employees suspected of improper receipt of public assistance payments are disciplined or terminated.*fn1 The district granted a motion to dismiss all of the appellants' claims. We will reverse the dismissal of most of those claims and remand for further proceedings.


Pennsylvania is a participant in the Aid to Families with Dependent Children Program (AFDC) established by the Social Security Act, 42 U.S.C. § 601 Et seq. (the Act). Under that program, Pennsylvania, like all participating states, must meet the requirements of the Act, as primarily set forth in 42 U.S.C. § 602, in order to receive federal funding.

In October 1977, the Governor's Office of the State of Pennsylvania published Management Directive 505.19 announcing a purpose "(t)o promulgate policy and procedures to be followed by state agencies in applying disciplinary actions to employees who improperly receive public assistance benefits." 7 Pa. Bulletin 3060. Pursuant to this Directive, the Pennsylvania Department of Public Welfare (DPW) undertook to match the computer list of all welfare recipients with the list of all state employees. Once the employees who were also welfare recipients were identified, agency heads were instructed to review each case and consider certain enumerated factors before deciding upon what disciplinary action, if any, should be taken.*fn2

Appellant Louise B. was employed by DPW as a psychiatric aide at the Pennsylvania State Hospital at Byberry. On January 13, 1978, she received a letter from the Assistant Superintendent of Clinical Services at the Hospital informing her that she was being suspended without pay for an indefinite period as of the close of business that day on the basis of an alleged willful receipt of welfare benefits to which she was not entitled. On January 26, 1978, she received a letter from the same official informing her that she was fired as of January 27, 1978.

Appellant Janie J. works for DPW as a clerk-typist at the West District of the Philadelphia County Board of Assistance. On January 13, 1978, she was notified by letter that she was being suspended, as of the day before, for five days without pay for willfully receiving payments to which she was not entitled.

Appellant Josephine R. is employed by DPW as a clerk at the Norristown State Hospital. On January 11, 1978, she was personally informed by the Hospital's Personnel Manager that she would be suspended. As a result of consultations between her counsel and DPW, Josephine R.'s suspension was delayed. The record does not reveal that she ever was actually suspended. She alleges, however, that she "remains in fear that at any moment defendants will act upon the false accusations and suspend or fire her from her employment." Complaint, Paragraph 78.

These appellants filed suit on their own behalf and on behalf of four sub-classes.*fn3 Appellants' primary claims were that the disclosure and use of information concerning welfare recipients as the basis for disciplining those recipients violated Section 402(a)(9) of the Act, 42 U.S.C. § 602(a)(9), 45 C.F.R. § 205.50, and DPW regulations contained in DPW Manual Chapter 105 (the confidentiality claim); and that the procedures the recipients were suspended or terminated violated their right to due process as guaranteed by the fourteenth amendment (the procedural due process claim). Appellants also alleged claims based on the right to privacy, equal protection, substantive due process defamation, federal and state regulations prescribing procedures to be followed in cases of alleged overpayments, and the provisions of Management Directive No. 505.19 (set forth in n.2, Supra ) that establish procedures for reviewing individual cases prior to taking disciplinary action. The confidentiality claim was dismissed for lack of jurisdiction. The procedural due process claim was dismissed on the ground that Arnett v. Kennedy, 416 U.S. 134, 94 S. Ct. 1633, 40 L. Ed. 2d 15 (1974) was controlling. The other federal claims were dismissed as being without merit and, presumably, therefore as not stating a claim upon which relief can be granted. The state law claims were thus left without any federal claims that could serve as a basis for pendent jurisdiction and were also dismissed.

On appeal, appellants have specifically urged only that the dismissal of the confidentiality and the procedural due process claims be reversed. At argument, counsel for appellants acknowledged that she pressed the other constitutional claims only insofar as they would serve as a basis for pendent jurisdiction over the confidentiality claim.*fn4 For the reasons now to be discussed, we will reverse the dismissal of the confidentiality and procedural due process claims. We will also reverse the dismissal of the constitutional privacy claim since, as a claim to which the confidentiality claim may be pended, it provides an alternative basis for jurisdiction over that claim. We will leave to the district court the initial decision as to whether pendent jurisdiction should be exercised over the state law claims on the basis of these federal claims.*fn5 Since appellants sought reversal of the dismissal of the substantive due process and equal protection claims only as a basis for pendent jurisdiction over the confidentiality claim and since we will conclude that such claims are unnecessary to provide such a basis, the dismissal of those two claims will not be disturbed.


Appellants argue that the DPW's disclosure of information from public assistance records to state agencies and the personnel offices of DPW for use in disciplining public assistance recipients who also were state employees violated 42 U.S.C. § 602(a)(9). That provision reads as follows:

(a) A state plan for aid and services to needy families with children must

(9) provide safeguards which restrict the use of disclosure of information concerning applicants or recipients to purposes directly connected with (A) the administration of the plan of the State approved under this part, the plan or program of the State under part B, C, or D of this subchapter or under subchapter I, X, XIV, XIX, or XX of this chapter, or the supplemental security income program established by subchapter XVI of this chapter, (B) any investigation, prosecution, or criminal or civil proceeding, conducted in connection with the administration of any such plan or program, and (C) the administration of any other Federal or federally assisted program which provides assistance, in cash or in kind, or services, directly to individuals on the basis of need; and the safeguards so provided shall prohibit disclosure, to any committee or a legislative body, of any information which identifies by name or address any such applicant or recipient.

As mentioned, this claim was dismissed for lack of jurisdiction. Appellants argue that there is jurisdiction over this claim under 28 U.S.C. § 1331 and under the principles of pendent jurisdiction.*fn6 We agree with both arguments and will discuss each separately. In determining that there is a ...

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