Federal Class Action Forces New Mexico to Overhaul Foster Care for Trauma-Impacted Youth

In September 2018, fourteen foster children and two disability-rights organizations filed a federal complaint against the secretaries of New Mexico's Children, Youth and Families Department (CYFD) and Human Services Department (HSD). The complaint alleged that the state had failed the most vulnerable youth in its care across three interconnected areas: children were sleeping in state office buildings and hotels for lack of stable placements, their medical and mental-health needs were going unmet, and the agencies had no coherent trauma-informed framework despite mounting evidence that complex trauma constitutes a disability under federal law.

The legal claims spanned Section 504 of the Rehabilitation Act, Title II of the Americans with Disabilities Act, the Fourteenth Amendment's substantive due process protections, the Medicaid Act, and the Indian Child Welfare Act. That last statute was central to the case because a disproportionate share of New Mexico's foster children are Native American, and the state had been routinely ignoring its ICWA obligations.

The Crecca Law Firm served as co-counsel alongside a coalition that included Disability Rights New Mexico, the Native American Disability Law Center, Public Counsel, Stanford Law School's Mills Legal Clinic, Munger Tolles and Olson, and several New Mexico litigation firms. Together they built the factual record showing systemic institutional failures rather than isolated incidents.

On March 26, 2020, after extensive negotiations, CYFD and HSD entered a settlement agreement with the plaintiffs and the suit was dismissed with prejudice. The agreement imposed concrete, measurable obligations: statewide trauma assessments and cross-departmental training for all adults working with foster youth, active recruitment of culturally diverse foster families, an end to hotel and office placements, expanded community-based behavioral health services, revised medication protocols, and a formal ICWA compliance plan. Three neutral experts were appointed to monitor implementation and report to the court.

The settlement covered approximately 4,700 children in New Mexico foster care at the time, making it one of the broadest child-welfare consent frameworks in the state's history. Monitoring reports in 2022 and 2023 documented persistent gaps, and plaintiffs returned to arbitration in 2024 to enforce the corrective action plan. In March 2026 an arbitrator adopted Stipulated Remedial Order No. 3, establishing new timelines for caseworker caseloads, resource-family recruitment, well-child visits, and treatment foster-care placements.