## Facts

- Family & Children’s Center, Inc. (FCC) operated a licensed private facility and group homes caring for about 110 emotionally handicapped children, many of whom had been suspended or expelled from public school due to disability-related behavior.
- FCC had physical custody of the children but was not their parent, legal guardian, or surrogate parent; legal custody remained with courts, parents, or placing agencies.
- Around 1979, FCC began educating the children at its own expense after public-school exclusion increased.
- FCC alleged the School City of Mishawaka refused to provide special-education services, classrooms, and related facilities required for children placed at FCC, despite those children being entitled to a free appropriate public education.
- Indiana’s IDEA-implementing procedures allowed “any individual, group, agency, or organization” to file an administrative complaint alleging IDEA violations.
- FCC filed an administrative complaint; relief was denied. FCC then sought judicial review in federal court after exhausting administrative remedies.

## Issues

1. Whether an organization with physical but not legal custody of disabled children has statutory standing under the IDEA, as implemented by Indiana’s procedural scheme, to seek judicial review as a “party aggrieved.”
2. Whether FCC alleged an Article III injury fairly traceable to the school district and likely redressable by an order requiring IDEA services, permitting FCC to litigate the children’s IDEA-based claims.

## Decision

- The Seventh Circuit reversed the district court’s Rule 12(b)(1) dismissal and remanded.
- FCC had statutory standing because Indiana’s regulations authorized organizations to initiate IDEA complaints, making FCC a “party aggrieved” entitled to judicial review after an adverse administrative decision.
- FCC satisfied Article III because it alleged concrete economic and operational injury from having to provide education itself, caused by the School City’s alleged failure to provide IDEA services, and likely remedied by an order requiring the School City to provide those services.

## Legal Principles

- IDEA procedural safeguards set minimum requirements; states may expand procedural rights, including who may initiate administrative complaints, so long as federal law does not forbid the expansion.
- A plaintiff qualifies as a “party aggrieved” entitled to IDEA judicial review when it is authorized to use the state administrative process and is adversely affected by the agency decision.
- Article III standing requires injury in fact, traceability, and redressability; state-law authorization to sue does not eliminate these constitutional requirements.
- An organization may assert claims tied to children’s IDEA rights where it alleges its own direct injury and state procedures permit it to invoke the IDEA enforcement process.

## Conclusion

The court held that Indiana could authorize organizations like FCC to initiate and pursue IDEA complaints, and that FCC’s alleged financial and programmatic burdens from the School City’s failure to provide special-education services satisfied Article III; the standing dismissal was reversed and the case returned for merits proceedings.


Family & Children’s Ctr., Inc. v. Sch. City of Mishawaka, 13 F.3d 1052 (7th Cir. 1994)