Third Circuit Finds that Hospital Failed to Mitigate Damages in an Equal Protection Claim Against the City for Preventing Opening of Methadone Treatement Facility

RHJ Medical Center, Inc., brought an action against the City of DuBois, Pennsylvania pursuant to the Americans with Disabilities Act; Section 504 of the Rehabilitation Act of 1973, 29 U.S.C. § 793; and the equal protection and due process clauses under 42 U.S.C. § 1983. In its original claim, RHJ contended the City unlawfully prevented it from opening and operating a methadone treatment facility within city limits by refusing to issue occupancy and use permits to RHJ, and subsequently by passing a zoning ordinance specifically designed to prevent RHJ from opening at its desired location. The District Court held that RHJ lacked standing to pursue its claims under the ADA and the Rehabilitation Act and ruled in favor of RHJ with respect to its equal protection challenge. Despite this favorable decision on the merits, the District Court limited RHJ’s damages because it determined that RHJ failed to make a reasonable attempt to mitigate its loss.

RHJ’s argument on appeal was that the District Court ignored its reasonable mitigation efforts and instead focused exclusively on its failure to seek to rent space from DRMC. The court reasoned that in a small town like DuBois it was unreasonable for RHJ to fail to contact the regional medical center to inquire whether it had space available for lease that was suitable for RHJ’s purposes. The District Court, after reviewing the evidence presented at trial, concluded that DRMC had space available and would have leased to RHJ if called upon. The court therefore found that RHJ’s failure to contact DRMC made RHJ’s mitigation efforts unreasonable. Accordingly, the Third Circuit affirmed the District Court’s holding that RHJ failed to mitigate its damages.

RHJ Med. Ctr., Inc. v. City of DuBois, 12-3641, 2014 WL 1623052 (3d Cir. 2014)