“Promise and Law” – Seventh Circuit Court of Appeals’ Ruling about Section 504 and the Girl Scouts

For lawyers who haven’t blocked out the early days of law school, Federal Rule of Civil Procedure 12(b)(6) stands out as one of those major stop-a-case-before-it-starts rules.  For those reading this piece, all you need to think about is that when you file a case in court, it needs to be a court that has power to help you under the law and that the help you’re seeking is something you can get at all.  On May 8, 2015, the 7th Circuit issued a ruling that, though not involving an individual with food allergies, does involve the applicability of Section 504 of the Rehabilitation Act, the same Section 504 that food allergy parents and guardians know all too well.

In Runnion v. Girl Scouts of Greater Chicago and Northwest Indiana, Edie Runnion filed suit on behalf of her minor daughter, Megan.  She alleged that Megan’s rights under Section 504 had been violated but the federal court tossed her claims under Rule 12(b)(6) and didn’t even allow her the chance to adjust her complaint and try again.  The court had ruled that allowing amendment of the complaint was futile because Section 504 didn’t cover the Girl Scouts.

(See here for the full opinion in pdf format.  Here’s a pdf fact sheet about the girl scouts and a screenshot of the fact sheet about the goal setting and business skills the organization touts as lessons learned for members through cookie sales.)

The Girl Scouts of America are a membership organization for young girls and are organized locally and nationally.  Below is their “Promise and Law:”

The Girl Scout Promise

On my honor, I will try:
To serve God and my country,
To help people at all times,
And to live by the Girl Scout Law.

The Girl Scout Law

I will do my best to be
honest and fair,
friendly and helpful,
considerate and caring,
courageous and strong, and
responsible for what I say and do,
and to
respect myself and others,
respect authority,
use resources wisely,
make the world a better place, and
be a sister to every Girl Scout.

Source: http://www.girlscouts.org/program/basics/promise_law/

The Facts

To quote the Seventh Circuit’s summary of the facts:

Plaintiff Megan Runnion was active in a Girl Scout troop run by defendant Girl Scouts of Greater Chicago and Northwest Indiana, which is the largest regional Girl Scout organization in the United States. Megan is deaf. For several years she benefitted from sign language interpreters provided by the Girl Scouts that enabled her to participate fully in the troop’s activities. The Girl Scouts then stopped providing interpreters. When her mother complained, Megan’s entire troop was disbanded.

Id. at 2.

The refusal to provide an interpreter and the disbanding of the troop were both alleged to be violations of Section 504.  Section 504 provides that where a program is receiving federal funding, they shall not discriminate on the basis of disability.  Violation of the law gives the aggrieved person the right to sue.  The appeal from the dismissal of Megan’s case has nothing to do with whether or not the Girl Scouts had to provide an interpreter, just whether she has the right to bring a case against the Girl Scouts under Section 504.  The main question ended up being if the federal funding of the Girl Scouts subjected them to Section 504.

Megan’s complaint in late 2012 alleged that Section 504 applied because the Girl Scouts received federal funding, however, the court ruled at the time that she had to allege much more.  Because of the disparity in power and access to information, usually stating your claims to the court in an opening document like a complaint is enough to get the ball rolling and allow you to do more investigation (called “discovery”) in the case as it moves along.  Even if there are specifics missing, a Plaintiff is generally permitted to go back and amend their complaint to fix whatever errors the court perceives and try again.  In the case of Megan Runnion, however, the court not only said her complaint was deficient, they ruled in favor of the Girl Scouts, not allowing her to make a different argument for why the Girl Scouts were subject to Section 504.

Here’s where the case gets interesting.  Megan was able to jump through some procedural hoops to get another chance at amending her complaint providing more detail to address the deficiencies claimed by the Girl Scouts. The Girl Scouts filed another motion to dismiss arguing that the Girl Scouts are not principally engaged in providing education or social services to girls and therefore did not have to comply with section 504 despite taking federal funding. The district court granted the Girl Scouts motion to dismiss in March of 2014 and held that allowing amendment of the complaint would be futile.  On appeal, the Runnion argued that the lower court had made a mistake in dismissing the complaint without allowing amendment and in concluding that section 504 did not apply to the Girl Scouts.

The Decision

Before 2009, Megan would have been allowed to amend her complaint as a matter of course, but the Girl Scouts argued that an amendment to the federal procedural rules changed the landscape a little bit.  The Girl Scouts claimed that when the motion to dismiss was received, before the court ruled on it, a given Plaintiff should amend their complaint right away or loose their chance to do so later.  The Seventh Circuit didn’t buy the argument and went on to consider the fact that the lower court saw the Girl Scouts as a private membership organization and not as an educational one.

If you’re following along, page 20 is where the discussion of the court becomes less about procedure and more about where the Girl Scouts are as an organization for applying Section 504.  The lower court tried to imply Section 504 applies to a private membership organization only if they’re open to the public and are providing a public service but the Seventh Circuit found that since the Rehabilitation Act goes to the trouble to discuss private organizations, Congress must have meant to include some private groups.

The Seventh Circuit Court of Appeals found, “that the Rehabilitation Act covers private organizations not open to the public if they receive federal financial assistance within the scope of § 794.”  Id. at 21.  It bears repeating – a private organization receiving federal funding falls under the Rehabilitation Act.  Even so, a private organization receiving federal funding could be exempt if they are not “principally engaged in the business of providing education, health care, housing, social services or parks or recreation.”  Id. (internal citations omitted).  Church groups that do educational activities, for example, may be seen as not principally engaged in those activities.

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