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Rocket Learning, Inc v. Jesus Rivera-Sanchez

April 18, 2013



The opinion of the court was delivered by: Lynch, Chief Judge.

Before Lynch, Chief Judge, Torruella and Selya, Circuit Judges.

Rocket Learning, Inc., an educational services provider based in Puerto Rico, appeals from a district court order dismissing with prejudice this civil rights action, filed pursuant to 42 U.S.C. § 1983, against defendant Jesus Rivera-Sanchez, personally and in his official capacity as Puerto Rico's Secretary of Education.

The suit alleges constitutional violations arising from a 2010 change to the certification and enrollment process for providers in the Commonwealth's Supplemental Educational Services program, funded under federal law. The claim is essentially that this change unilaterally and arbitrarily disadvantaged the appellant, a certified provider, vis-a-vis its competitors. The district court found that the amended complaint lacked sufficiently well-pled facts to support a plausible claim that the defendant had violated Rocket Learning's equal protection, due process, or commercial free speech rights. We now affirm the district court's decision on the alternative ground that the defendant was entitled to qualified immunity as to all claims.


Title I, Part A of the Elementary and Secondary Education Act of 1965, as amended by the No Child Left Behind Act of 2001, makes available federal funding for state educational agencies to provide, inter alia, various academic opportunities to students from low-income families. See No Child Left Behind Act of 2001, Pub. L. No. 107-110, §§ 1111-1117, 115 Stat. 1425, 1444-1501 (2002) (codified at 20 U.S.C. §§ 6311-6317). One of these opportunities, the Supplemental Educational Services (SES) program, entitles eligible students to receive tutoring services at no cost from a private or public organization certified by the state and selected by the students' guardians. 20 U.S.C. § 6316(e)(1); 34 C.F.R. § 200.45. The Commonwealth of Puerto Rico has participated in the SES program since 2003, as administered by the Puerto Rico Department of Education (PRDE).

Each academic year, the PRDE conducts a three-stage enrollment procedure to match eligible students with SES providers. First, in the certification process, prospective SES providers submit an annual certification or re-certification proposal, through a Request for Qualification (RFQ), which determines their eligibility to enroll students in the upcoming year. Such proposals must comply with requirements enumerated in the RFQ application and in the Commonwealth's SES Procedures Manual ("SES Manual"), and cannot be amended after submission except as requested by the PRDE.

After certification, SES providers compete amongst themselves to attract eligible students and their guardians to sign up for their tutoring services during the pre-enrollment process. As required by federal regulation, the PRDE initiates pre-enrollment by compiling a roster of certified providers on its website for SES participants to evaluate. Additionally, providers hold informational meetings, independently and through local schools, to describe the services that they will offer to students in the upcoming year. At the close of pre-enrollment, guardians fill out a form SES-101 to identify, in order of preference, the three SES providers with whom they would like their student to work.

Finally, in the pre-test process, students are administered tests to assess their individual needs, which providers discuss with each student's guardians. The guardians and a provider then submit a form SES-102 to the PRDE, which memorializes their agreement as to that student's needs and the services the provider will furnish to him or her. Once the SES-102 forms are approved, the PRDE executes a contract with the relevant provider and services ordinarily begin within two to four days.

This case concerns the Commonwealth's SES enrollment procedure for the 2010-2011 academic year. As initially set forth by the PRDE, the entire process was to span no more than four months. It began on June 11, 2010, the deadline for submitting an RFQ application, and ended on October 15, 2010, the date on which the PRDE would enter into an SES contract with the second provider identified on the form SES-101 if the preferred provider had not begun administering tutoring services to the relevant student.

Rocket Learning submitted its certification proposal for the 2010-2011 academic year on June 9, 2010. The SES Manual in place at that time, the "Old Manual," limited the kinds of prizes that providers could award to their students as end-of-course gifts to "medals, trophies, certificates, [and] educational materials, such as educational games, manipulative toys, books, and dictionaries," and prohibited the promotion of any end-of-course gifts during the enrollment process. Importantly, neither the Old Manual nor the RFQ application required certification proposals to list specifically all electronic devices that would be used as part of a provider's tutoring program.*fn1

The PRDE approved Rocket Learning's certification proposal in August 2010, and thereafter SES providers began promoting their services in anticipation of the pre-enrollment process. Despite the Old Manual's restrictions, some SES providers sought to entice potential students during this period by offering electronic devices as end-of-course gifts, making these providers more attractive. The SES Providers Association -- a not-for-profit organization to which most of the Commonwealth's SES providers belong, including the appellant -- sent a letter to the PRDE informing it of these improper promotional activities and requesting that the agency enforce the Old Manual.

On September 28, 2010, defendant Jesus Rivera-Sanchez (the "Secretary") issued a superseding version of the SES Manual, the "New Manual." The New Manual required for the first time that all technological devices to be used in a provider's teaching process be specified in its certification proposal. It also amended the Old Manual's provision concerning end-of-course gifts, first by explicitly stating that "[o]ffering incentives during the enrollment [process] . . . is strictly prohibited[,]" and second by removing the sentence stating that the giving of "[a]ny other [end-of-course] article or gift [not listed in the SES Manual] is strictly prohibited." Notwithstanding these changes, the PRDE did not request that providers submit amended certification proposals consistent with the New Manual.

The pre-enrollment process took place between October 4 and October 21, 2010. According to the complaint, approximately eight of the fifty participating SES providers disregarded the New Manual's prohibition on the promotion of end-of-course electronic gifts. These organizations experienced considerable increases over their traditional enrollment numbers, while the remaining providers suffered corresponding enrollment decreases. Following written protests and a demonstration at the PRDE's headquarters, the Secretary met on October 20, 2010 with some of the SES providers disadvantaged during this pre-enrollment process.

The PRDE annulled the first pre-enrollment period on November 4, 2010, and scheduled a second for December 6 through December 10, 2010. On November 16, the PRDE circulated a questionnaire by email to a group of approximately twenty-five SES providers to clarify the relationship between the electronic devices included or referred to in their respective original certification proposals and the provider's instructional services. The PRDE's Technology and Curriculum Unit evaluated each organization's answers to determine whether, for purposes of the SES Manual, the technological devices in question constituted "educational material" that could be promoted during the enrollment process. Rocket Learning was not among the recipients of the November 16 email, although its proposal did include as teaching materials the use of audiobooks, videos, and music requiring the use of electronic devices.

On December 4, 2010, two days before the start of the second pre-enrollment period, the PRDE published a full-page ad in a local newspaper notifying eligible students that they could retain any of the educational materials, including technological devices, that they used during the SES program. The PRDE also sent a December 6 email instructing all certified providers that "educational material specifically included in the provider's [certification proposal] . . . [would] not be considered an incentive or reward for purposes of compliance with the rules of the Department of Education[,]" and therefore could be promoted and given away as end-of-course gifts.

As a result of these various changes, only those providers that had received the November 16 email were permitted to promote electronic devices during the December pre-enrollment process. At the close of this process, Rocket Learning's enrollment numbers had ...

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