Nat'l Educ. Ass'n v. DeVos

345 F. Supp. 3d 1127
CourtDistrict Court, N.D. California
DecidedDecember 17, 2018
DocketCase No. 18-cv-05173-LB
StatusPublished
Cited by4 cases

This text of 345 F. Supp. 3d 1127 (Nat'l Educ. Ass'n v. DeVos) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Nat'l Educ. Ass'n v. DeVos, 345 F. Supp. 3d 1127 (N.D. Cal. 2018).

Opinion

LAUREL BEELER, United States Magistrate Judge *1131INTRODUCTION

Title IV of the Higher Education Act of 1965, as amended, authorizes the Secretary of Education and the Department of Education (collectively, the "Department") to provide grants and establish financial-assistance programs to help students pay for post-secondary education. Educational institutions must meet certain requirements to participate in these financial-assistance programs.

In December 2016, the Department promulgated regulations adding new requirements for institutions that offer distance-education or correspondence-course programs. Program Integrity and Improvement , 81 Fed. Reg. 92,232 (Dec. 19, 2016). Section 668.50 of the regulations (the "Disclosure Rule") required the institutions to issue certain disclosures, both publicly and individually, to their enrolled and prospective students (collectively, the "Disclosures"). Among other things, the Disclosure Rule required the educational institutions to disclose (1) any adverse actions that a state entity or an accrediting agency might have initiated against them and (2) whether their educational programs that prepare students for jobs in fact satisfy the educational requirements for state licensing or certification for those jobs (e.g., whether a program that prepares students to become teachers satisfies the educational requirements for its students to get teaching certificates). Id. at 92,262 -63.

The Disclosure Rule was set to go into effect on July 1, 2018. Following a change in presidential administrations, however, the Department issued a new rule in the summer of 2018 (the "Delay Rule"), delaying the effective date of the Disclosure Rule from July 1, 2018 to July 1, 2020 and raising the prospect that it would revise and reconsider the Disclosure Rule entirely. Program Integrity and Improvement , 83 Fed. Reg. 31,296, 31,296 (July 3, 2018).

The National Education Association (the "NEA"), the California Teachers Association (the "CTA"), and Shane Heiman, Kwynn Uyehara, and Stephanie Portilla (the "Individual Plaintiffs") - NEA and CTA members who are enrolled or considering enrolling in online-education programs - filed this action against the Department. The plaintiffs allege that the Department failed to comply with certain statutory requirements in promulgating the Delay Rule and that the Delay Rule thus is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law" in violation of the Administrative Procedure Act (the "APA").

The Department moves to dismiss the plaintiffs' complaint under Federal Rule of Civil Procedure 12(b)(1) on the ground that the plaintiffs do not have Article III standing. The Department argues that the plaintiffs (1) have not suffered an injury in fact (2) that is fairly traceable to the Department (3) that is redressable. The Department argues that the loss of the Disclosures does not constitute an injury in fact caused by the Department. The Department also argues that any purported harm to the plaintiffs is speculative and conjectural. The plaintiffs respond that they are being deprived of information that they would have received in the Disclosures and that they would use that information to make decisions about whether to continue to spend their time and money in continuing in their online-education programs. The plaintiffs argue that the loss of this information is an injury in fact and *1132that this injury is fairly traceable to the Department's actions in issuing the Delay Rule.

The court denies the Department's motion to dismiss. The plaintiffs have pleaded standing.

STATEMENT

1. The Higher Education Act's "State Authorization" Requirement

Congress enacted the Higher Education Act (the "HEA") "[t]o strengthen the educational resources of our colleges and universities and to provide financial assistance for students in postsecondary and higher education." Higher Education Act of 1965, Pub. L. No. 89-329, 79 Stat. 1219, 1219 (1965). Title IV of the HEA "assist[s] in making available the benefits of postsecondary education to eligible students ... in institutions of higher education" through federal grants and financial-assistance programs. 20 U.S.C. § 1070.

The HEA imposes certain requirements on educational institutions to be eligible for students to pay for their programs with Title IV grants and loans. 20 U.S.C. § 1094(a) ("In order to be an eligible institution for the purposes of any program authorized under this subchapter, an institution must be an institution of higher education or an eligible institution (as that term is defined for the purpose of that program)[.]"). In order for an institution within the United States to be eligible, it must be "an educational institution in any State that ... is legally authorized within such State to provide a program of education beyond secondary education[.]" 20 U.S.C. § 1001(a)(2) ; see 20 U.S.C. § 1094(i)(4) (citing 20 U.S.C. § 1002(a)(1), (b)(1)(B), (c)(1)(B) (citing 20 U.S.C. § 1001 ) ).

The HEA does not further define what it means for an educational institution to be "legally authorized within such State."

2. The 2016 Disclosure Rule

During the last presidential administration, concerns were raised regarding fraud and noncompliance among online and distance-education programs.

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Bluebook (online)
345 F. Supp. 3d 1127, Counsel Stack Legal Research, https://law.counselstack.com/opinion/natl-educ-assn-v-devos-cand-2018.