United States ex rel. Bernier v. InfiLaw Corp.

311 F. Supp. 3d 1288
CourtDistrict Court, M.D. Florida
DecidedApril 23, 2018
DocketCase No. 6:16–cv–970–Orl–37TBS
StatusPublished
Cited by1 cases

This text of 311 F. Supp. 3d 1288 (United States ex rel. Bernier v. InfiLaw Corp.) is published on Counsel Stack Legal Research, covering District Court, M.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States ex rel. Bernier v. InfiLaw Corp., 311 F. Supp. 3d 1288 (M.D. Fla. 2018).

Opinion

ROY B. DALTON JR., United Stated District Judge

What goes up must come down. This case concerns the rise and fall of Charlotte School of Law, LLC ("CSL "), a now-defunct for-profit law school owned by the private entity InfiLaw Corporation ("InfiLaw ") (collectively, "Defendants "). (Doc.

*129048, ¶¶ 35-36.) After flying too close to the sun, CSL was expelled from the federal student loan program and its educational license revoked. (Id. ¶ 48.) Amidst its downfall, CSL's former professor Plaintiff Barbara Bernier initiated this qui tam action against Defendants under the False Claims Act ("FCA "), 31 U.S.C. § 3729, et seq. , alleging fraudulent conduct in connection with federal loan funding Defendants received from the United States Department of Education ("DOE "). (See Doc. 1.)

After some investigation, the United States declined to intervene on Bernier's behalf (Doc. 14),1 so the Court unsealed the complaint (Doc. 16) and Defendants moved to dismiss (Doc. 45). With leave, Plaintiff filed an amended complaint (Doc. 48 ("Amended Complaint ") ), now before the Court on Defendants' motion to dismiss (Doc. 53 ("Motion ") ).

I. BACKGROUND

InfiLaw formed in 2006. (Doc. 48, ¶ 24.) Its stated mission was "to establish the benchmark of inclusive excellence in professional education for the 21st Century." (Id. ¶ 30.) To that end, InfiLaw acquired three for-profit law schools: Florida Coastal School of Law ("Florida Coastal "), Arizona Summit School of Law ("Arizona Summit "), and CSL ("InfiLaw Schools "); and began implementing a "disruptive," non-traditional law school model at each school ("Model "). (See id. ¶¶ 31, 35.) What apparently sets the Model apart is that its academic programs focus on placing "graduates into the stream of commerce," as opposed to "theory only programs" that lack practice competencies. (Id. ¶ 31.)

Touting this model, InfiLaw structures its operations differently from other law schools: from its admissions practices, curriculum design, academic requirements and bar exam preparation initiatives, InfiLaw certainly has its own way of doing things. (See id. ¶¶ 23-31, 38-40, 42.) Yet one area where InfiLaw sticks to the well-trod path is by having its schools participate in federal loan programs under Title IV of the Higher Education Act ("HEA "), 20 U.S.C. § 1070, et seq. -meaning that students can obtain federal funding to cover all of their education-related expenses. (Id. ¶¶ 9, 12, 51.) For law schools, eligibility for this money hinges on accreditation by the American Bar Association ("ABA ") and execution of a Program Participation Agreement ("PPA ") with the DOE, whereby the institution agrees, among other things, to maintain certain standards and comply with federal statutes and regulations while receiving funds. (Id. ¶¶ 10-22.) Such standards speak to admissions practices, academic progress, employment outcomes, and institutional management-not only to ensure student success and enable loan repayment, but also to stem potential program abuse and promote the integrity of Title IV. (Id. ¶¶ 13-22.) Suffice it to say that the disbursement of federal funds is highly regulated and has many strings attached. (See id. )

According to Plaintiff, Defendants did not comply with Title IV's statutory and regulatory requirements, but took federal funds anyway. (See id. ¶¶ 111-131.) She claims that Defendants violated the FCA by: (1) knowingly presenting or causing to be presented a false or fraudulent claim for payment or approval; (2) knowingly making, using, or causing to be used a false record or statement material to a false or fraudulent claim; and (3) conspiracy. (See id. ¶¶ 111-49 (alleging violations of §§ 3729(a)(1)(A)-(C) ).) Claiming that Defendants'

*1291conduct netted over $285 million in federal funds ("Funds "), Plaintiff brings suit to recover a percentage of the Funds, plus interest and attorney fees. (Id. ¶¶ 128, 131, 142, 149.)

In response, Defendants move to dismiss Plaintiff's Amended Complaint with prejudice. (Doc. 53.) Having been fully briefed (Docs. 56, 59), the matter is now ripe. Upon review, the Court finds that the Motion is due to be granted in part.

II. LEGAL STANDARDS

Under the minimum pleading requirements of the Federal Rules of Civil Procedure, plaintiffs must provide short and plain statements of their claims with simple and direct allegations set out in numbered paragraphs and distinct counts. See Fed. R. Civ. P. 8(a), 8(d), & 10(b). If a complaint does not comport with these minimum pleading requirements, if it is plainly barred, or if it otherwise fails to set forth a plausible claim, then it is subject to dismissal under Rule 12(b)(6). See Ashcroft v. Iqbal , 556 U.S. 662, 672, 678-79, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Bell Atl. Corp. v. Twombly ,

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311 F. Supp. 3d 1288, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-ex-rel-bernier-v-infilaw-corp-flmd-2018.