Domestic Violence Survivors Support Group, Inc. v. Crouch

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF WEST VIRGINIA

AT CHARLESTON

DOMESTIC VIOLENCE SURVIVORS

SUPPORT GROUP, INC., d/b/a

DOMESTIC VIOLENCE COUNSELING

CENTER, and ELIZABETH CRAWFORD,

Plaintiffs,

v. Civil Action No. 2:18-cv-00452

BILL E. CROUCH, in his official

Capacity as Secretary of the West

Virginia Department of Health and Human

Resources; PATRICIA BAILEY, individually

and in her official capacity as Chairperson

of the Family Protection Services Board, an

entity of the West Virginia Department of

Health and Human Resources; WEST VIRGINIA

DEPARTMENT OF HEALTH AND HUMAN RESOURCES;

THE FAMILY PROTECTION SERVICES BOARD; and

WEST VIRGINIA COALITION AGAINST DOMESTIC

VIOLENCE, INC.,

Defendants.

MEMORANDUM OPINION AND ORDER

Pending is the plaintiffs’ motion for leave to amend

their complaint, filed May 10, 2020 (ECF No. 45).

I. Background

The plaintiffs in this case are the Domestic Violence

Survivors Support Group, Inc., a West Virginia non-profit

corporation doing business as the Domestic Violence Counseling

Center (“DVCC”), and Elizabeth Crawford, an African-American

woman who founded and serves as the executive director of DVCC.

ECF No. 1 ¶¶ 1–2. On March 17, 2018, the plaintiffs filed an

eight-count complaint against five defendants: the West Virginia

Department of Health and Human Services (“DHHR”); Bill E.

Crouch, in his official capacity as the Secretary of DHHR; the

Family Protection Services Board (the “Board”); Patricia Bailey,

individually and in her official capacity as the Board’s

chairperson; and the West Virginia Coalition Against Domestic

Violence, Inc. (the “Coalition”). See id. at 1–17.

The complaint alleges the defendants, particularly Ms.

Bailey and the Board, denied the plaintiffs’ pre-application to

be licensed as a domestic violence program on the ground that

the plaintiffs’ proposed program did not include a physical

shelter component for domestic violence victims. See id. ¶¶ 11,

14. The plaintiffs allege that the stated reason for the denial

was a pretext, as the relevant statutes and regulations do not

require the program to have a physical shelter but, instead,

allow licensed programs to refer victims to other entities that

have a physical shelter. See id. ¶¶ 11-20. The real reason for

the denial, the complaint alleges, was racial discrimination.

See id. ¶ 14.

The complaint further alleges that the Coalition, a

non-profit organization operating licensed domestic violence

centers in West Virginia, aided and abetted the other defendants

in their discrimination against the plaintiffs. See id. ¶¶ 7,

34. The complaint alleges that the Coalition’s members engaged

in a campaign to spread rumors that DVCC was an unsafe program,

to persuade public officials to deny DVCC public funding and

recognition, to exclude Ms. Crawford from public events

regarding domestic violence, and to verbally and emotionally

abuse her. See id. ¶¶ 35-41, 45. The complaint also alleges

that the Coalition’s conduct was motivated by racial animus.

See id. ¶ 42.

The defendants moved to dismiss the complaint pursuant

to Fed. R. Civ. P. 12(b)(1) and (6), arguing that the plaintiffs

lacked standing, that some of the defendants were entitled to

sovereign or qualified immunity, and that the complaint failed

to state claims for which relief could be granted. See ECF No.

24; ECF No. 26; ECF No. 31. The court granted one of the

motions and granted two others in part and denied them in part.

See ECF No. 50 at 75–76. The court concluded that only one of

the complaint’s claims, Count 3, survived the motions and only

against Secretary Crouch and Ms. Bailey in their official

capacities. See id. at 76. The court thus dismissed Count 3 as

to the other defendants and dismissed the remaining seven counts

as to all the defendants. See id. at 75–76.

In the meantime, the plaintiffs filed the current

motion for leave to amend their complaint. See ECF No. 45. The

proposed amendment is premised on the March 27, 2020 enactment

of the Coronavirus Aid, Relief, and Economic Security Act

(“CARES Act”), Pub. L. No. 116-136 (2020), in response to the

COVID-19 pandemic. See ECF No. 45-1 ¶ 2; see also id. ¶¶ 3-4,

7–10, 12. The proposed amended complaint alleges that the CARES

Act included funding for state domestic violence programs and

that, in West Virginia, DHHR is responsible for distributing

those funds. See id. ¶¶ 3–4. It alleges that the plaintiffs

requested funds to provide telehealth counseling to their

clients, see id. ¶ 7, but were “all but inform[ed]” that “no

CARES Act funds would be forthcoming” for them, id. ¶ 8. The

proposed amended complaint further alleges that the plaintiffs’

clients are primarily from the African-American community, which

is disproportionately affected by the COVID-19 pandemic. See

id. ¶¶ 6–7. It also alleges that domestic violence centers

associated with the Coalition have received CARES Act funds from

DHHR, see id. ¶ 9, and that Secretary Crouch is aware that the

plaintiffs’ largely minority clients are more susceptible to

coronavirus, see id. ¶ 10. Based on these allegations, the

proposed amended complaint would assert six counts, five of

which expressly correspond to counts brought in the initial

complaint.1 See id. ¶¶ 13-25.

In response, the defendants argue that the plaintiffs’

motion for leave to amend should be denied because the proposed

amendment would be futile, as all the counts would be subject to

dismissal under Rule 12(b). See ECF No. 46; ECF No. 47. The

motion has been fully briefed and is ripe for disposition.

II. Legal Standard

Although the plaintiffs’ motion is styled as a motion

for leave to amend pursuant to Fed. R. Civ. P. 15(a), the

proposed amended complaint is premised on events that happened

1 Counts 1, 2, 5, and 6 of the proposed amended complaint

expressly correspond to Counts 1, 2, 7, and 8, respectively, of

the initial complaint. See ECF No. 45-1 ¶¶ 13, 17, 23, 25.

Count 4 of the proposed amended complaint expressly corresponds

to both Counts 5 and 6 of the initial complaint. See id. ¶ 20.

Although Count 3 of the proposed amended complaint does not

expressly correspond to any count in the initial complaint, it

is similar in language and structure to Count 3 of the initial

complaint. Compare id. at 4–5, with ECF No. 1 at 13–14. The

plaintiffs state that no count of their proposed amended

complaint corresponds to Count 4 of the initial complaint

because Count 4 “concerned the lack of an appeal process for

licensing” that “does not appear applicable to receipt of CARES

Act funds.” ECF No. 45-1 ¶ 20 n.*.

It appears that Count 1 and Count 4 of the proposed

amended complaint would be brought only by DVCC and not by Ms.

Crawford, while Count 6 would be brought only by Ms. Crawford

and not by DVCC. See ECF No. 45-1 ¶ 13, 20–21, 24–25.

after the plaintiffs filed their initial complaint, and the

motion is thus properly construed as a motion for leave to file

a supplemental complaint under Fed. R. Civ. P. 15(d). See

Franks v. Ross, 313 F.3d 184, 198 n.15 (4th Cir. 2002); Ohio

Valley Env’t Coal. v. U.S. Army Corps of Eng’rs, 243 F.R.D. 253,

255–56 (S.D.W. Va. 2007); 6 Charles Alan Wright et al., Federal

Practice and Procedure § 1473 (3d ed. 2020). The distinction is

largely immaterial, however, as the court assesses motions for

leave to amend and motions for leave to supplement under “nearly

identical” standards. Franks, 313 F.3d at 198 n.15; see also

Ohio Valley, 243 F.R.D. at 255–56; Wright et al., § 1473.

For a motion requesting leave to supplement the

complaint, leave should be freely granted unless good reason

exists to deny it. See Franks, 313 F.3d at 198 n.15; see also

Ohio Valley, 243 F.R.D. at 256. Good reason to deny a plaintiff

leave to supplement the complaint exists when, among other

things, the proposed supplement would be futile. See Durstein

v. Alexander, No. 3:19-0029, 2020 WL 4741094, at *2 (S.D.W. Va.

Aug. 14, 2020); Harwood v. Arch Coal, Inc., No. 2:19-cv-00577,

2020 WL 1977124, at *2 (S.D.W. Va. Apr. 24, 2020); Estate of

Williams-Moore v. All. One Receivables Mgmt., Inc., 335 F. Supp.

2d 636, 644 (M.D.N.C. 2004). “‘A proposed [supplement] is

futile when it is clearly insufficient or frivolous on its

face.’” Harwood, 2020 WL 1977124, at *3 (quoting Save Our Sound

OBX, Inc. v. N.C. Dep’t of Transp., 914 F.3d 213, 228 (4th Cir.

2019)). A proposed supplement is also futile if the proposed

supplemental complaint fails to satisfy the requirements of the

federal rules, such as Rule 12(b)(1) and Rule 12(b)(6). See

Durstein, 2020 WL 4741094, at *2; Harwood, 2020 WL 1977124, at

*3; see also United States ex rel. Ahumada v. NISH, 756 F.3d

268, 274, 279, 282 (4th Cir. 2014).

A. Rule 12(b)(1) Lack of Subject Matter Jurisdiction

Rule 12(b)(1) allows a defendant to challenge a

complaint for lack of subject matter jurisdiction. Fed. R. Civ.

P. 12(b)(1). Federal district courts are courts of limited

subject matter jurisdiction, possessing “only the jurisdiction

authorized them by the United States Constitution and by federal

statute.” U.S. ex rel. Vuyyuru v. Jadhav, 555 F.3d 337, 347

(4th Cir. 2008) (citing Exxon Mobil Corp. v. Allapattah Servs.,

Inc., 545 U.S. 546, 552 (2005)). “[T]here is no presumption

that a federal district court has jurisdiction.” Pinkley, Inc.

v. City of Frederick, 191 F.3d 394, 399 (4th Cir. 1999). The

facts essential to show jurisdiction must be affirmatively

alleged in the complaint. Dracos v. Hellenic Lines, Ltd., 762

F.2d 348, 350 (4th Cir. 1985). If the court lacks subject

matter jurisdiction over any claim, the claim must be dismissed.

See Arbaugh v. Y&H Corp., 546 U.S. 500, 506 (2006).

Constitutional standing is generally addressed under

Rule 12(b)(1) because “Article III [of the United States

Constitution] gives federal courts jurisdiction only over cases

and controversies, and standing is an integral component of the

case or controversy requirement.” CGM, LLC v. BellSouth

Telecommunications, Inc., 664 F.3d 46, 52 (4th Cir. 2011)

(internal citation and quotation marks omitted). To meet the

constitutional standing requirement, a plaintiff must satisfy

three elements: (1) the plaintiff must have suffered an “injury

in fact,” which is an invasion of a legally protected interest

that is “concrete and particularized,” and “actual or imminent,

not conjectural or hypothetical”; (2) there must be “a causal

connection between the injury and the conduct complained of,”

meaning that the injury must be “fairly traceable to the

challenged action of the defendant,” and not the result of the

independent action of some third party not before the court; and

(3) it must be “likely, as opposed to merely speculative, that

the injury will be redressed by a favorable decision.” Friends

of the Earth, Inc. v. Laidlaw Env’t Servs. (TOC), Inc., 528 U.S.

167, 180–81 (2000) (internal citations and quotation marks

omitted) (citing Lujan v. Defs. of Wildlife, 504 U.S. 555, 560–

61 (1992)).

To determine standing at the pleading stage, “general

factual allegations of injury resulting from the defendant’s

conduct may suffice, for on a motion to dismiss we presume that

general allegations embrace those specific facts that are

necessary to support the claim.” Lujan, 504 U.S. at 561

(internal citations omitted). The court may accept as true

allegations that are supported by adequate factual matter to

render them plausible on their face. Beck v. McDonald, 848 F.3d

262, 270 (4th Cir. 2017) (citing Ashcroft v. Iqbal, 556 U.S.

662, 678 (2009)). The same presumption of truth does not apply

to conclusory statements and legal conclusions contained in the

complaint. Id. (citing Iqbal, 556 U.S. at 678).

B. Rule 12(b)(6) Failure to State a Claim

Rule 8(a)(2) of the Federal Rules of Civil Procedure

requires that a pleader provide “a short and plain statement of

the claim showing that the pleader is entitled to relief.” Fed.

R. Civ. P. 8(a)(2). Rule 12(b)(6) correspondingly permits a

defendant to challenge a complaint when it “fail[s] to state a

claim upon which relief can be granted.” Fed. R. Civ. P.

12(b)(6). The purpose of a Rule 12(b)(6) motion to dismiss is

to test the sufficiency of a complaint. Edwards v. City of

Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999).

Specific facts are not necessary in a pleading, “but

only enough facts to state a claim to relief that is plausible

on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570

(2007). The pleading “must give the defendant fair notice of

what the . . . claim is and the grounds upon which it rests.”

Id. at 555 (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957));

see also Iqbal, 556 U.S. at 678 (explaining that the Rule 8

pleading standard “does not require ‘detailed factual

allegations,’ but it demands more than an unadorned, the-

defendant-unlawfully-harmed-me accusation”).

“[W]hen ruling on a defendant’s motion to dismiss, a

judge must accept as true all of the factual allegations

contained in the complaint.” Erickson v. Pardus, 551 U.S. 89,

94 (2007) (citing Twombly, 550 U.S. at 572). However, the court

is not required to accept as true the legal conclusions set

forth in a plaintiff’s complaint. Edwards, 178 F.3d at 244.

To survive a Rule 12(b)(6) 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.’” See Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S.

at 570). To contain sufficient factual matter to make a claim

plausible, the factual allegations must “allow[] the court to

draw the reasonable inference that the defendant is liable for

the misconduct alleged.” Id.

III. Discussion

The court finds it useful to assess the proposed

amended complaint by separating the defendants into two groups.

A. The Board, Ms. Bailey, and the Coalition

(1) Standing

Except for Count 6, the proposed amended complaint

premises all its claims on allegations that the plaintiffs’

request for CARES Act funding has been denied. See ECF No. 45–1

¶¶ 7–8, 12–23; see also ECF No. 45 at 1 (explaining that the

“plaintiffs move for leave to amend their [c]omplaint for [the]

defendants’ conduct related to . . . [the] []CARES[] Act”). The

proposed amended complaint also expressly alleges that “the

vehicle for distribution of [CARES Act] funds is . . . []DHHR[]”

through an agency, the Bureau for Children and Families, that is

not named as a defendant in this suit. ECF No. 45–1 ¶ 4

(emphasis added). And, it alleges that the plaintiffs requested

CARES Act funding “from DHHR” and that a “DHHR [official],”

informed the plaintiffs that no CARES Act funding would be

forthcoming. Id. (emphasis added).

The proposed amended complaint contains virtually no

factual allegations regarding the Board’s, Ms. Bailey’s, or the

Coalition’s involvement in the denial of the plaintiffs’ request

for CARES Act funding. It contains no factual allegations

regarding the Board, and in fact, makes no reference to the

Board at all outside the case caption. It contains no factual

allegations regarding Ms. Bailey and only refers to her in

passing twice. See id. ¶¶ 13, 25. Aside from a conclusory

allegation, neither of the two references to Ms. Bailey indicate

that she has had any role in the denial of the plaintiffs’

request for CARES Act funds. See id. The proposed amended

complaint contains a single factual allegation regarding the

Coalition, namely, that it received CARES Act funding from DHHR.

See id. ¶ 9. But, again, aside from conclusory allegations, the

three other references to the Coalition in the proposed amended

complaint do not indicate that it has had any role in the denial

of the plaintiffs’ request for CARES Act funding. See id. ¶¶

13–14, 25.

The proposed amended complaint thus fails to allege

that the injury complained of—the denial of CARES Act funding—

can be fairly traced to the conduct of the Board, Ms. Bailey, or

the Coalition. With respect to these three defendants, the

plaintiffs fail to allege the necessary causal connection

between their asserted injury and the conduct complained of

largely because the proposed amended complaint does not actually

complain of conduct taken by the Board, Ms. Bailey, or the

Coalition. In the few instances in which the proposed amended

complaint objects to the conduct of these three defendants, it

does so only in conclusory terms. See id. ¶ 13 (asserting that

DVCC brings a “claim . . . against [Ms.] Bailey . . . and [the

Coalition] for conspiracy under color of state law . . . to deny

DVCC its rightful shares of CARES Act funds due to racial

discrimination”); id. ¶ 14 (asserting that “the nature of th[e]

conspiracy involves” the same allegations in the initial

complaint that the “Coalition . . . racially discriminat[ed]

against [the plaintiffs]”). But conclusory allegations like

these are insufficient for purposes of standing at the pleading

stage. See Beck, 848 F.3d at 270.

The plaintiffs attempt to avoid this result by arguing

that their initial complaint sufficiently alleges the role these

three defendants have played in causing the plaintiffs’ injury.

See ECF No. 48 at 1–2; ECF No. 49 at 1–2. However, the initial

complaint does nothing to clarify the plaintiffs’ allegations

against these three defendants with respect to the alleged

denial of CARES Act funding. The initial complaint alleges the

Board’s and Ms. Bailey’s conduct in denying the plaintiffs’ pre-

application for a domestic violence program license resulted in

the loss of public and private funding opportunities. See ECF

No. 1 ¶ 67. But neither the initial complaint nor the proposed

amended complaint allege that the denial of a license resulted

in the denial of CARES Act funding, and the proposed amended

complaint in fact alleges that the decision to deny CARES Act

funding was made not by the Board or Ms. Bailey but by DHHR and

another state agency not named as a defendant in this matter.

See ECF No. 45-1 ¶ 4. Likewise, although the initial complaint

generally alleges that the Coalition has lobbied public

officials to deny DVCC public funding, see ECF No. 1 ¶ 36,

neither the initial complaint nor the amended complaint alleges

that the Coalition lobbied any public official to deny the

plaintiffs’ request for CARES Act funding.

Because the plaintiffs’ proposed amended complaint

fails to plausibly allege the injury complained of can be fairly

traced to the conduct of the Board, Ms. Bailey, or the

Coalition, the court concludes that the plaintiffs would lack

standing to bring the first five counts against these three

defendants and that supplementing the complaint to bring these

counts against these defendants would therefore be futile.

Accordingly, the court denies the motion for leave to amend

insofar as the motion seeks to supplement the complaint by

adding the first five counts of the proposed amended complaint

against the Board, Ms. Bailey, and the Coalition.2

(2) Failure to State a Claim

Count 6 of the proposed amended complaint states in

relevant part:

In a similar manner as Count Eight of the

original [c]omplaint [Ms.] Bailey . . . and the

[Coalition] continue or have yet to cease and desist

from the mean-spirited, racially motivated and

humiliating conduct toward Ms. Crawford to the extent

it causes this plaintiff emotional distress and often

physical illness. By virtue of it never ceasing and

continuing without remorse, apology or even civil

restraint Ms. Crawford doubles her earlier claim for

emotional damages to $100,000.00 against these

particular defendants . . . .

ECF No. 45-1 ¶ 25.

Thus, Count 6 of the proposed amended complaint merely

reasserts Count 8 of the plaintiffs’ initial complaint and seeks

to add, at most, that the alleged conduct of Ms. Bailey and the

Coalition underlying Count 8 has continued. In its October 7,

2020 memorandum opinion and order, the court concluded that Ms.

2 It is not clear whether Count 1 of the proposed amended

complaint is intended to be brought against the Board. Compare

ECF No. 45-1 ¶ 13–15 (specifically naming all other defendants),

with id. at 4 (asking for order directed against all defendants

in prayer for relief for Count 1). To the extent the plaintiffs

intend for Count 1 to be brought against the Board, the court

denies their motion for leave to amend to do so for the reasons

set out above.

Crawford had standing to bring Count 8 and that Ms. Bailey was

not entitled to qualified immunity with respect Count 8. See

ECF No. 50 at 12, 27–28, 45. The court understood Count 8 to

advance a claim for either intentional or negligent infliction

of emotional distress and concluded that the allegations of the

complaint were insufficient to support either claim under the

Rule 12(b)(6) standard. See id. at 68–75.

The proposed amended complaint provides no further

allegations that would be sufficient to support claims for

intentional or negligent infliction of emotional distress under

Rule 12(b)(6). Accordingly, the court concludes that Count 6 of

the proposed amended complaint would be subject to dismissal for

failure to state a claim and that supplementing the complaint to

add Count 6 would therefore be futile. The court thus denies

the motion for leave to amend the complaint to the extent the

plaintiffs seek to amend the complaint to add Count 6.

B. DHHR and Secretary Crouch

(1) Standing

The proposed amended complaint would assert its first

five counts against DHHR and Secretary Crouch. See ECF No. 45-1

¶¶ 13–23. The court turns next to addressing the plaintiffs’

standing to bring these claims.

(i) Count 4

The proposed amended complaint expressly states that

Count 4 corresponds to both Counts 5 and 6 of the initial

complaint. See id. ¶ 20. With respect to Count 4, the proposed

amended complaint asserts that the defendants’ denial of CARES

Act funding “constitutes an unlawful restraint of trade,” in

violation of 15 U.S.C. § 15, and seeks an injunction preventing

the defendants from engaging in “conduct of this nature in

restraint of trade,” pursuant to 15 U.S.C. § 26. Id. at 5.

Counts 5 and 6 in the initial complaint asserted violations of

the antitrust laws under the Sherman Act, 15 U.S.C. § 1 et seq.,

for which the plaintiffs sought damages and injunctive relief

under 15 U.S.C. §§ 15, 26. See ECF No. 30 at 5-6.

As the court explained in its October 7, 2020

memorandum opinion and order, “‘[i]n a private antitrust action,

a plaintiff must go beyond a showing that it meets the Article

III standing requirements of injury, causation, and

redressability; it must also demonstrate antitrust standing.’”

ECF No. 50 at 22 (quoting Novell, Inc. v. Microsoft Corp., 505

F.3d 302, 310 (4th Cir. 2007)). “It is not enough . . . for a

plaintiff merely to allege that the defendant violated the

antitrust laws and that he was injured. The injury suffered by

the plaintiff must be of the type the antitrust laws were

intended to forestall.” Blue Shield of Va. v. McCready, 457

U.S. 465, 486 (1982) (internal citations omitted). The Fourth

Circuit applies a five-factor analysis to determine whether a

plaintiff has antitrust standing:

(1) the causal connection between an antitrust

violation and harm to the plaintiffs, and whether that

harm was intended; (2) whether the harm was of a type

that Congress sought to redress in providing a private

remedy for violations of the antitrust laws; (3) the

directness of the alleged injury; (4) the existence of

more direct victims of the alleged antitrust injury;

and (5) problems of identifying damages and

apportioning them among those directly and indirectly

harmed.

Kloth v. Microsoft, 444 F.3d 312, 324 (4th Cir. 2006) (internal

citations and quotation marks omitted).

The court concluded that, for Counts 5 and 6 of the

initial complaint, the plaintiffs had “fail[ed] to demonstrate

that the alleged harm is the type of harm that Congress sought

to redress in providing a private remedy for violations of the

antitrust laws” because they “fail[ed] to specify which

antitrust laws the defendants are alleged to have violated” and

provided “no plausible allegations that . . . the alleged

actions of the defendants produce anticompetitive results in the

relevant market” or “a monopoly.” ECF No. 50 at 24. The court

therefore concluded that the plaintiffs had failed to

sufficiently allege antitrust standing and accordingly dismissed

Counts 5 and 6 for lack of subject matter jurisdiction. See id.

at 24–25.

Count 4 of the proposed amended complaint would fail

for the same reasons identified by the court’s October 7, 2020

memorandum opinion and order with respect to Counts 5 and 6 of

the initial complaint. Neither the initial complaint nor the

proposed amended complaint specifies how the defendants’ conduct

violates the antitrust laws or plausibly alleges that the

defendants’ conduct produces anticompetitive results or a

monopoly. Thus, the plaintiffs have failed to allege that their

injury—denial of CARES Act funds—is the kind of injury that

Congress sought to redress by providing a private remedy for

violation of the antitrust laws. Accordingly, the court

concludes that the plaintiffs would lack standing to bring Count

4, which would be subject to dismissal for lack of subject

matter jurisdiction. The court thus denies the motion for leave

to amend to the extent the plaintiffs seek to amend the

complaint to add Count 4.

(ii) Count 5

The proposed amended complaint expressly states that

Count 5 corresponds to Count 7 of the initial complaint. See

id. ¶ 23. With respect to Count 5, the proposed amended

complaint asserts that “the defendants have caused DVCC to lose

what it estimates $75,000.00 to date in CARES Act funds through

their unlawful acts and asks for compensatory damages in that

same amount.” Id.

Count 7 of the initial complaint similarly asserted

that the defendants had “unlawfully depriv[ed] plaintiff DVCC”

of benefits causing it to lose funding and sought damages “for

unlawful conduct by [the] defendants.” ECF No. 1 at 16. In its

October 7, 2020 memorandum opinion and order, the court

concluded that, because neither the allegations of the initial

complaint nor the plaintiffs’ briefing on the motions to dismiss

“ articulate[d] any legally-protected interest,” the plaintiffs

failed to allege an “invasion of [an] interest to establish an

injury-in-fact for standing” and that “it is only speculative

that the alleged injury will be redressed by a favorable

decision.” ECF No. 50 at 27. Accordingly, the court dismissed

Count 7 for lack of subject matter jurisdiction.

Count 5 of the proposed amended complaint would be

subject to dismissal for the same reasons identified by the

court with respect to Count 7 of the initial complaint. Count

5’s reference to “unlawful conduct” does not articulate any

legally-protected interest that can form the basis of an injury

in fact or non-speculative relief for purposes of standing.

Neither the initial complaint nor any of the plaintiffs’

briefing provides useful clarification. Accordingly, the court

concludes that the plaintiffs would lack standing to bring Count

5, which would be subject to dismissal for lack of subject

matter jurisdiction. The court thus denies the motion for leave

to amend to the extent the plaintiffs seek to amend their

complaint to add Count 5.

(iii) Counts 1, 2, and 3

The proposed amended complaint expressly states that

Counts 1 and 2 correspond to Counts 1 and 2, respectively, of

the initial complaint. See ECF No. 45–1 ¶¶ 13–17. Although the

proposed amended complaint does not state that Count 3

corresponds to any count of the initial complaint, it asserts a

claim that in language and structure is similar to Count 3 in

the initial complaint. Compare ECF No. 45-1 at 4–5, with ECF

No. 1 at 13–14. Counts 2 and 3 of the proposed amended

complaint assert that, by denying the plaintiffs’ request for

CARES Act funding, the defendants, including DHHR and Secretary

Crouch, acting under color of state law, deprived the plaintiffs

of property on the basis of race in violation of their

Fourteenth Amendment due-process and equal-protection rights and

42 U.S.C. § 1983. See EFC No. 45-1 at 4–5. Count 1 of the

proposed amended complaint asserts that the defendants,

including DHHR and Secretary Crouch, acting under color of state

law, conspired to deny the plaintiffs’ request for CARES Act

funding on the basis of race in violation of the Fourteenth

Amendment and 42 U.S.C. § 1985. See id. at 3–4.

Counts 1, 2, and 3 of the initial complaint asserted

somewhat similar claims that the defendants, acting under color

of state law, had conspired to deprive the plaintiffs of

property on the basis of race by denying the plaintiffs’ pre-

application for a domestic violence program license in violation

of the Fourteenth Amendment and §§ 1983 and 1985. See ECF No. 1

at 11–14. In its October 7, 2020 memorandum opinion and order,

the court concluded that the plaintiffs had standing to bring

these claims. See ECF No. 50 at 16–19.

Here, the court likewise concludes that the plaintiffs

would have standing to bring Counts 1, 2, and 3 of the proposed

amended complaint against DHHR and Secretary Crouch. The denial

of CARES Act funding based on a state agency’s and state

official’s alleged consideration of race constitutes a

cognizable injury in fact. The injury is fairly traceable to

DHHR, which the proposed amended complaint alleges is

responsible for distributing CARES Act funds, and to Secretary

Crouch, in his official capacity as the Secretary of DHHR. And

the relief sought—an injunction to distribute CARES Act funds in

a racially neutral manner—would redress the plaintiffs’ injury.

(2) Eleventh Amendment Immunity

DHHR and Secretary Crouch assert that they would be

immune from the remaining claims asserted against them in the

proposed amended complaint under the Eleventh Amendment. See

ECF No. 47 at 6 n.4. As the court explained in its October 7,

2020 memorandum opinion and order, “[s]tates enjoy sovereign

immunity from suit,” and “[t]he Eleventh Amendment,” which

“enshrines sovereign immunity of the [s]tates by restricting the

judicial power of federal courts to hear cases” in which states

are sued, extends its protection to “arms of the state” and to

“[s]tate officers acting in their official capacity.” ECF No.

50 at 28–29. The court concluded that DHHR, as an arm of the

state, enjoys sovereign immunity in this case pursuant the

Eleventh Amendment. See id. at 30, 33. However, the court

concluded that, under Ex parte Young, 209 U.S. 123 (1908),

Secretary Crouch did not enjoy immunity from suit in his

official capacity because the relief the plaintiffs seek in

Counts 1, 2, and 3 of the initial complaint is prospective,

injunctive relief, the claims concern an ongoing constitutional

violation based on racial discrimination, and Secretary Crouch

has a sufficient connection to the state agency responsible for

the alleged violation. See id. at 33-41.

Here, for the same reasons set forth in its October 7,

2020 memorandum opinion and order, the court concludes that DHHR

is an arm of the state that enjoys sovereign immunity from the

claims asserted in the proposed amended complaint, pursuant to

the Eleventh Amendment. Accordingly, the remaining claims in

the proposed amended complaint against DHHR would be subject to

dismissal, and the court concludes that amending the complaint

to include such claims would be futile. The court thus denies

the motion for leave to amend the complaint to the extent the

plaintiffs seek to add the remaining claims against DHHR to

their complaint.

However, for the reasons set forth in its October 7,

2020 memorandum opinion and order, the court concludes that,

pursuant to Ex parte Young, Secretary Crouch is not protected by

sovereign immunity. Like Counts 1, 2, and 3 of the initial

complaint, Counts 1, 2, and 3 of the proposed amended complaint

seek prospective, injunctive relief for ongoing constitutional

violations based on racial discrimination, and Secretary Crouch

has a sufficient connection to the state agency—here, DHHR—

alleged to be responsible for the violation.

(3) Failure to State a Claim

Having concluded that the plaintiffs would have

standing to bring Counts 1, 2, and 3 of the amended complaint

against Secretary Crouch and that Secretary Crouch would not

enjoy Eleventh Amendment immunity from these claims, the court

turns to assess whether Counts 1, 2, and 3 would be subject to

dismissal for failure to state a claim pursuant to Rule

12(b)(6).

(i) Count 1

Count 1 of the initial complaint alleged that

Secretary Crouch negligently allowed racial discrimination to

occur, which resulted in the denial of the plaintiffs’ pre-

application for a domestic violence program license. See ECF

No. 1 ¶ 53. The court dismissed Count 1 of the initial

complaint against Secretary Crouch pursuant to Rule 12(b)(6).

ECF No. 50 at 50. The court explained that, “[a]cting

negligently to allow an alleged conspiracy” does not give rise

to liability because “[c]onspiracy is an intentional act, not a

negligent one.” Id. at 49–50 (citing Young v. F.D.I.C., 103

F.3d 1180, 1190 (4th Cir. 1997); Mallamo v. Town of Rivesville,

477 S.E.2d 525, 533 (W. Va. 1996)). Because the plaintiffs had

alleged only negligence and had not alleged that “Secretary

Crouch in in any way participated in a joint plan of action,”

the court concluded dismissal was appropriate. Id. at 49.

Count 1 of the proposed amended complaint would also

assert that Secretary Crouch was “negligent . . . for allowing

the [alleged] racial discrimination” to occur. ECF No. 45-1 ¶

15. Neither the initial complaint nor the proposed amended

complaint alleges that Secretary Crouch participated in any way

in a joint plan of action. Accordingly, for the same reasons

set forth in its October 7, 2020 memorandum and opinion, the

court concludes that, with respect to Secretary Crouch, Count 1

would be subject to dismissal for failure to state a claim and

that amending the complaint to add Count 1 would therefore be

futile. Thus, the motion for leave to amend the complaint is

denied to the extent the plaintiffs seek to add Count 1 against

Secretary Crouch to their complaint.

(ii) Count 2

Count 2 of the proposed amended complaint would assert

a Fourteenth Amendment due process claim against Secretary

Crouch and the other defendants based on the denial of

plaintiffs’ request for CARES Act funds. See ECF No. 45–1 at 4.

To state a claim for violation of procedural due process rights,

a plaintiff must plausibly allege “(1) a cognizable . . .

property interest; (2) the deprivation of that interest by some

form of state action; and (3) that the procedures employed were

constitutionally inadequate.” Accident, Injury & Rehab., PC v.

Azar, 943 F.3d 195, 203 (4th Cir. 2019) (internal quotation

marks omitted) (quoting Iota Xi Chapter of Sigma Chi Fraternity

v. Patterson, 566 F.3d 138, 145 (4th Cir. 2009)).

A cognizable “‘property interest must be more than a

‘unilateral expectation’; it must be a ‘legitimate claim of

entitlement.’” L.M. Everhart Constr., Inc. v. Jefferson Cnty.

Planning Comm’n, 2 F.3d 48, 51 (4th Cir. 1993) (quoting Biser v.

Town of Bel Air, 991 F.2d 100, 104 (4th Cir. 1993)). “[S]uch

interests do not arise from the Fourteenth Amendment itself but

rather stem from an independent source.” Siena Corp. v. Mayor &

City Council of Rockville, 873 F.3d 456, 461 (4th Cir. 2017)

(internal quotation marks omitted) (quoting Bd. of Regents v.

Roth, 408 U.S. 564, 577 (1972)).

The court concludes that the proposed amended

complaint does not plausibly state a due process claim because

it fails to sufficiently allege deprivation of a cognizable

property interest. Although the plaintiffs allege that they

have been deprived of a property interest, namely, “federal

funding” under the CARES Act, ECF No. 45-1 ¶ 17, they do not

allege that they are entitled to these funds or plead any facts

implying entitlement. At most, the plaintiffs allege that they

have an acute need for the funds because the primarily African-

American clientele they serve is disproportionately and more

severely affected by the COVID-19 pandemic than are other

groups. See id. ¶¶ 6–7, 10. But an “abstract need or desire”

for funding is not sufficient to show that such funding

constitutes a cognizable property interest for purposes of a due

process claim. Roth, 408 U.S. at 577. In the absence of

allegations explaining how the plaintiffs have a legitimate

claim of entitlement to CARES Act funding, Count 2 would fail to

state a claim. See Ellis v. Thornsbury, No. 2:14-cv-24641, 2015

WL 13039641, at *7 (S.D.W. Va. Sept. 25, 2015) (concluding the

complaint failed to state a cognizable property interest because

it did “not allege[] why [the plaintiffs] were entitled” to

putative property interest or provide “any elaboration

demonstrating that [putative property interest] was an

entitlement”); Herman v. Lackey, No. 2007 WL 9735415, at *3

(W.D.N.C. June 7, 2007) (dismissing due-process claim in part

because the “[c]omplaint allege[d] nothing more than a

unilateral expectation that the license would be issued”).

Accordingly, the court concludes that, with respect to

Secretary Crouch, Count 2 of the proposed amended complaint

would be subject to dismissal for failure to state a claim.

Thus, the motion for leave to amend the complaint is denied to

the extent the plaintiffs seek leave to amend their complaint to

add Count 2 against Secretary Crouch.

(iii) Count 3

Count 3 of the proposed amended complaint would

assert, pursuant to § 1983, a Fourteenth Amendment equal

protection claim against Secretary Crouch and other defendants

based on the denial of CARES Act funds. See ECF No. 45–1 at 4–

5. To state a claim for an equal protection violation, “a

plaintiff must plausibly allege first ‘that [s]he has been

treated differently from others with whom [s]he is similarly

situated and that the unequal treatment was the result of

intentional or purposeful discrimination.’” Fauconier v.

Clarke, 966 F.3d 265, 277 (4th Cir. 2020) (quoting Martin v.

Duffy, 858 F.3d 239, 248 (4th Cir. 2017)). If these facts are

plausibly alleged, then “the plaintiff must also plausibly

allege that the disparity was not justified under the

appropriate level of scrutiny.” Id.

To plausibly state an equal-protection claim, then, “a

plaintiff must [allege] not only that similarly situated

individuals were treated differently,” but also that the

difference in treatment was the result of intentional or

purposeful discrimination. Cent. Radio Co., Inc. v. City of

Norfolk, 811 F.3d 625, 635 (4th Cir. 2016). Thus, if a

plaintiff asserts “that a statute has been administered . . .

discriminatorily, more must be [alleged] than the fact that a

benefit was denied to one person while conferred on another. A

violation is established only if the plaintiff [alleges] that

the state [official] intended to discriminate.” Sylvia Dev.

Corp. v. Calvert Cnty., 48 F.3d 810, 819 (4th Cir. 1995)

(emphasis in original) (internal citation omitted); see Snowden

v. Hughes, 321 U.S. 1, 8 (1944) (“The unlawful administration by

state officers of a state statute fair on its face, resulting in

its unequal application to those who are entitled to be treated

alike, is not a denial of equal protection unless there is shown

to be present in it an element of intentional or purposeful

discrimination.”). A plaintiff need not allege that

discrimination is the defendant’s sole motivation, but the

plaintiff must assert the requisite discriminatory intent with

more than mere conclusory allegations. See Pronin v. Johnson,

628 F. App’x 160, 164 (4th Cir. 2015); Johnson v. Holmes, 204 F.

Supp. 3d 880, 890 (W.D. Va. 2016).

The proposed amended complaint fails to plausibly

allege that Secretary Crouch acted with the requisite

discriminatory intent or purpose. Although, in Count 3, the

plaintiffs allege that they were denied CARES Act funding based

upon considerations of race, see ECF No. 45-1 at 4–5, the

proposed amended complaint contains no allegation suggesting

that Secretary Crouch intended to discriminate against the

plaintiffs based on race. In fact, the sole factual allegation

in the proposed amended complaint regarding Secretary Crouch

suggests just the opposite. See ECF No. 45-1 ¶ 10 (alleging

that Secretary Crouch “recognized” that the COVID-19 pandemic

has disproportionately affected minority communities and that he

sought to “assur[e] minority group leaders” that he would

“further investigat[e] . . . the matter”). The initial

complaint likewise does not allege that Secretary Crouch acted

with discriminatory intent and, in fact, contains no factual

allegations regarding Secretary Crouch aside from those

regarding his role as DHHR’s current secretary.

Further, the proposed amended complaint does not

plausibly allege that DHHR’s denial of the plaintiffs’ request

for CARES Act funding resulted from discriminatory intent. At

most, the proposed amended complaint alleges that DHHR denied

funding to plaintiffs, whose clients are primarily African

American, and granted funding to other domestic violence

programs. See id. ¶¶ 7–9. But these allegations amount to

little more than an assertion that funding was denied to some

entities and granted to others, an assertion that is

insufficient by itself to state an equal-protection claim. See

Snowden, 321 U.S. at 8; Sylvia Dev. Corp., 48 F.3d 810 at 819.

The initial complaint likewise contains no factual allegations

suggesting that DHHR has acted with discriminatory intent.3

The only allegations in the proposed amended complaint

and the initial complaint that might be understood to charge

Secretary Crouch and DHHR with discriminatory intent are wholly

conclusory and unsupported by factual allegations. See, e.g.,

ECF No. 1 ¶¶ 53, 61; ECF No. 45–1 ¶¶ 14–15. Conclusory

allegations like these are insufficient to withstand a Rule

12(b)(6) motion to dismiss. See Pronin, 628 F. App’x at 164;

Johnson, 204 F. Supp. 3d at 890.

Accordingly, the court concludes that, with respect to

Secretary Crouch, Count 3 of the proposed amended complaint

would be subject to dismissal pursuant to Rule 12(b)(6) for

failure to state a claim and that amending the complaint to

3 In its October 7, 2020 memorandum opinion and order, the court

denied the defendants’ motions to dismiss an equal-protection

claim against Secretary Crouch, in his official capacity, based

on the Board’s denial of a domestic violence program license.

See ECF No. 50 at 76. As explained therein, the court concluded

that Secretary Crouch was subject to suit based on the Board’s

discriminatory motivation in denying the license, which the

initial complaint sufficiently alleges, see id. at 61–65, in

conjunction with his role as the secretary of DHHR, in which

capacity he may be deemed responsible for the Board’s conduct,

see id. at 40, 65–66. Here, however, with respect to the denial

of CARES Act funding, the plaintiffs have failed to sufficiently

allege that DHHR acted with the discriminatory intent necessary

to make Secretary Crouch subject to an equal-protection claim

based on his role as DHHR’s secretary.

include Count 3 would therefore be futile. The plaintiffs’

motion for leave to amend their complaint is thus denied to the

extent they seek to add Count 3 against Secretary Crouch.

Iv. Conclusion

For the foregoing reasons, it is ORDERED that the

plaintiffs’ motion for leave to amend their complaint (ECF No.

45) be, and hereby it is, denied.

The Clerk is directed to transmit copies of this

memorandum opinion and order to all counsel of record and any

unrepresented party.

ENTER: October 19, 2020

- Mb, Lo

Jo . Copenhaver, Jr.

Senior United States District Judge

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