Court Opinion

ID: 4176313
Source: CourtListenerOpinion
Date Created: 2017-06-09 19:05:11.696101+00
Date Added: 2024-06-11T14:38:39.438722
License: Public Domain

UNPUBLISHED

                      UNITED STATES COURT OF APPEALS
                          FOR THE FOURTH CIRCUIT

                                     No. 16-1637

BRISTOL UNIVERSITY,

                   Plaintiff – Appellee,

             v.

ACCREDITING COUNCIL FOR INDEPENDENT COLLEGES AND SCHOOLS,

                   Defendant – Appellant.

Appeal from the United States District Court for the Eastern District of Virginia, at
Alexandria. Anthony J. Trenga, District Judge. (1:16−cv−00307−AJT−MSN)

Argued: March 24, 2017                                         Decided: June 9, 2017

Before TRAXLER and WYNN, Circuit Judges, and DAVIS, Senior Circuit Judge.

Reversed, vacated, and remanded by unpublished opinion. Senior Judge Davis wrote the
opinion, in which Judge Traxler joined. Judge Wynn wrote a separate opinion concurring
in the judgment in part.

ARGUED: Thomas Collier Mugavero, WHITEFORD, TAYLOR & PRESTON, LLP,
Falls Church, Virginia, for Appellant. Robert William Loftin, MCGUIREWOODS, LLP,
Richmond, Virginia, for Appellee. ON BRIEF: Kenneth J. Ingram, Michael C. Gartner,
WHITEFORD, TAYLOR & PRESTON, LLP, Falls Church, Virginia, for Appellant.
Richard D. Holzheimer, Jr., Brooks H. Spears, McLean, Virginia, Nathan A. Kottkamp,
MCGUIREWOODS, LLP, Richmond, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.

                                            2
DAVIS, Senior Circuit Judge:

       Bristol University (“Bristol”) is a California for-profit school that received

accreditation from the Accrediting Council for Independent Colleges and Schools

(“ACICS”). ACICS denied Bristol’s application for renewal of accreditation, and Bristol

challenged ACICS’s decision in district court. The district court preliminarily enjoined

ACICS from suspending Bristol’s accreditation and stayed further proceedings. On

appeal, ACICS contends that the district court erred by granting Bristol’s request for a

preliminary injunction because Bristol did not demonstrate a likelihood of success on the

merits of its due process claim. For the reasons that follow, we reverse the grant of the

preliminary injunction, lift the stay, and remand for further proceedings.

                                            I.

       Bristol offers one-year, two-year, and four-year programs in business

administration and certificate programs in legal studies and hospitality operations. The

school was founded in 1991 as Kensington College and received initial accreditation

from ACICS in 1993. The college maintained consistent accreditation until 2011, when it

underwent an ownership change and was renamed Bristol University. One year later,

ACICS granted Bristol a three-year accreditation renewal that was to expire on December

31, 2015.

       Bristol applied for renewal of its accreditation in October 2014. In May 2015,

ACICS began the renewal process by sending an on-site evaluation team to Bristol. The

following month, ACICS’s evaluation team issued a report identifying 40 deficiencies

requiring explanation from Bristol. Bristol responded to ACICS’s report in July 2015.

                                             3
       On August 20, 2015, ACICS sent Bristol a deferral letter and show-cause directive

that identified 37 areas in which the school remained noncompliant. ACICS requested

that Bristol provide explanations and supporting evidence for each of the deficiencies by

October 31, 2015. In the same letter, ACICS also directed Bristol to show cause why its

renewal application should not be denied at ACICS’s December 2015 meeting. The letter

explained that “[ACICS] is obligated to take adverse action against any institution that

fails to come into compliance with the Accreditation Criteria within established time

frames without good cause.” J.A. 233. ACICS referred Bristol to Title II, Chapter 3, of

the Accreditation Criteria for more information, which provides that the “time frame will

not exceed . . . two years, if the longest program is at least two years in length.” J.A. 287,

593.

       In September 2015, ACICS sent another evaluation team to Bristol. The team

issued a report on October 29, 2015. On December 22, 2015, ACICS denied Bristol’s

renewal of accreditation application based on 24 unresolved deficiencies. In its denial

letter, ACICS listed each of Bristol’s remaining violations of the Accreditation Criteria

and extended the current grant of accreditation to January 31, 2016, to allow the school to

prepare for its loss of accreditation.

       After the denial of the renewal application, Bristol appealed to the Review Board

of Appeals (the “Review Board”), which is “a separate, independent appeals body

established by [ACICS] for the purpose of hearing appeals by institutions.” J.A. 292, 597.

In the Review Board hearing on March 18, 2016, Bristol did not contest the 24

deficiencies. Instead, the school asked the Review Board to remand with the

                                              4
recommendation that Bristol receive additional time to correct the deficiencies. Later that

day, the Review Board affirmed ACICS’s decision.

       On March 21, 2016, Bristol filed a complaint against ACICS in federal district

court seeking declaratory and injunctive relief. Bristol also moved for a temporary

restraining order prohibiting ACICS from revoking its accreditation, which the district

court granted. On March 25, 2016, Bristol moved for a preliminary injunction, which the

district court granted on April 25, 2016. The court concluded that Bristol was likely to

succeed on the merits of its due process claim because ACICS “ignored its rationale for

deciding to defer action, eliminated the compliance warning step, and advanced directly

to the show-cause stage without giving Bristol clear deadlines for compliance, as opposed

to providing additional information.” J.A. 553. The court further found that ACICS’s

“failure to comply with its own internal review procedures [was] compounded by the lack

of a record sufficient to determine what specific issues [ACICS] or the Review Board

considered and decided, and on what basis it decided those issues.” J.A. 554. The court

noted that ACICS “did not explain . . . [why] no further opportunity to come into

compliance was warranted,” and that “[t]he Review Board did not provide any rationale

in support of its position, either in the form of a written opinion, or an oral ruling during

the hearing.” Id.

       ACICS timely appealed the district court’s order granting a preliminary injunction.

                                             II.

       We first address whether we have jurisdiction over this appeal. In its complaint,

Bristol invoked subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331, 1337 and 20

                                             5
U.S.C. § 1099b. Since the appeal was filed, ACICS lost Department of Education

recognition as an accreditation agency. ACICS has filed a lawsuit against the Department

of Education and the Secretary of Education, asking the district court to grant preliminary

and permanent injunctive relief enjoining the implementation of the decision to terminate

ACICS’s recognition as an accreditation agency, vacate the decision withdrawing

ACICS’s recognition, and order the Secretary of Education to return ACICS’s petition for

recognition to the Department of Education for reconsideration. See Accrediting Council

for Indep. Colls. & Schs. v. U.S. Dep’t of Educ., No. 16-cv-2448 (D.D.C.). In light of

ACICS’s loss of federal recognition, we asked the parties for supplemental briefing

addressing whether the Department of Education’s termination of its recognition of

ACICS as an accrediting agency deprives us of jurisdiction over this appeal. We conclude

that the district court had diversity jurisdiction over this dispute pursuant to 28 U.S.C. §

1332.

        The diversity jurisdiction statute provides that “district courts shall have original

jurisdiction of all civil actions where the matter in controversy exceeds the sum or value

of $75,000, exclusive of interest and costs, and is between . . . citizens of different

States.” 28 U.S.C. § 1332(a)(1). “[A] plaintiff’s complaint sufficiently establishes

diversity jurisdiction if it alleges that the parties are of diverse citizenship and that the

matter in controversy exceeds, exclusive of interest and costs, the sum specified by 28

U.S.C. § 1332.” Ellenburg v. Spartan Motors Chassis, Inc., 519 F.3d 192, 200 (4th Cir.

2008) (internal quotation marks and alterations omitted). Bristol’s complaint did not

invoke diversity of citizenship jurisdiction but did state that Bristol is a citizen of

                                              6
California and ACICS is incorporated in Virginia. Furthermore, although Bristol did not

plead an amount in controversy, it did allege that without accreditation, the school would

be forced to close. The value of Bristol as a business clearly exceeds $75,000; thus, this

dispute undoubtedly satisfies the amount in controversy requirement for diversity

jurisdiction. See Hunt v. Wash. State Apple Advert. Comm’n, 432 U.S. 333, 347 (1977)

(“In actions seeking declaratory or injunctive relief, it is well established that the amount

in controversy is measured by the value of the object of the litigation.”); Francis v.

Allstate Ins. Co., 709 F.3d 362, 367 (4th Cir. 2013) (same).

       Bristol’s complaint contained three counts: (1) failure to comply with due process,

in violation of federal common law; (2) negligence per se, in violation of the Higher

Education Act, 20 U.S.C. § 1099b, and 34 C.F.R. §§ 602.16, 602.25; and (3) injunctive

and declaratory relief pursuant to 28 U.S.C. § 2201 et seq. 1 Diversity jurisdiction extends

beyond state and foreign law claims to include federal law claims like the ones Bristol

has asserted. See Hales v. Winn-Dixie Stores, Inc., 500 F.2d 836, 848 n.1 (4th Cir. 1974)

(“While state law claims usually may only be asserted when diversity is present, the same

cannot be said of the converse: this Court knows of no case or policy requiring that

diversity jurisdiction may only include state or foreign law claims and must exclude

       1
         Of course, the Declaratory Judgment Act “creates [no] substantive rights,” CGM,
LLC v. Bellsouth Telecomms., Inc., 664 F.3d 46, 55 (4th Cir. 2011), but under the
circumstances of this appeal, and unlike our concurring friend, we need not pause to
assess the legal sufficiency of the claims asserted in the first two counts of the complaint.
Instead, given the undeniable existence of subject matter jurisdiction, we limit our
consideration to the issue of whether the district court erred in applying the standards for
a preliminary injunction, the very basis for this interlocutory appeal, over which we
surely have jurisdiction. 28 U.S.C. § 1292(a)(1).

                                             7
federal law claims. Federal law does on occasion control suits brought under diversity

jurisdiction.”). Accordingly, satisfied with the existence of federal subject matter

jurisdiction, we proceed to consider whether the district court erred in granting the

preliminary injunction.

                                             III.

       ACICS argues that the district court erred by granting Bristol’s request for a

preliminary injunction because Bristol did not demonstrate a likelihood of success on the

merits of its due process claim, as Bristol failed to establish that ACICS’s decisions were

arbitrary and capricious. To obtain a preliminary injunction, a plaintiff “must demonstrate

that (1) they are likely to succeed on the merits; (2) they will likely suffer irreparable

harm absent an injunction; (3) the balance of hardships weighs in their favor; and (4) the

injunction is in the public interest.” League of Women Voters of N.C. v. North Carolina,

769 F.3d 224, 236 (4th Cir. 2014). We review “a district court’s decision to grant

preliminary injunctions under an abuse of discretion standard.” Pashby v. Delia, 709 F.3d

307, 319 (4th Cir. 2013). The district court’s decision “will not be disturbed on appeal

unless the record shows an abuse of that discretion, regardless of whether the appellate

court would, in the first instance, have decided the matter differently.” Centro Tepeyac v.

Montgomery Cty., 722 F.3d 184, 188 (4th Cir. 2013) (en banc). A district court abused its

discretion if it “applied an incorrect preliminary injunction standard, rested its decision

on a clearly erroneous finding of a material fact, or misapprehended the law with respect

to underlying issues in litigation.” Id. (internal quotation marks and alterations omitted).

                                              8
       Accreditation agencies owe a common law duty of due process “to employ fair

procedures when making decisions.” Prof’l Massage Training Ctr., Inc. v. Accreditation

All. of Career Schs. & Colls., 781 F.3d 161, 169 (4th Cir. 2015). ACICS was a federally-

recognized accrediting agency when it reviewed and denied Bristol’s renewal of

accreditation application. As such, its actions were subject to the due process

requirements of 20 U.S.C. § 1099b(6) and its supporting regulation, 34 C.F.R. § 602.25.

       Although the Administrative Procedure Act does not specifically apply to private

accrediting agencies for education institutions, “principles of administrative law are

useful in determining the standard by which we review the agency’s decision-making

process.” Prof'l Massage Training Ctr., 781 F.3d at 170 (alternations omitted). In

assessing whether an accreditation agency violates due process, we consider “only

whether the decision of an accrediting agency . . . is arbitrary and unreasonable or an

abuse of discretion and whether the decision is based on substantial evidence.” Id. at 171

(internal quotation marks omitted). “Under this standard, courts are not free to conduct a

de novo review or to substitute their judgment for the professional judgment of the

educators involved in the accreditation process.” Id. (internal quotation marks omitted).

       Courts adjudicating common law due process claims against accrediting agencies

“should focus primarily on whether the accrediting body’s internal rules provided a fair

and impartial procedure and whether it followed its rules in reaching its decision.” Prof’l

Massage Training Ctr., 781 F.3d at 172 (internal quotation marks and alterations

omitted). Agency actions are generally invalid where the “agency fails to follow its own

procedures or regulations.” Nader v. Blair, 549 F.3d 953, 962 (4th Cir. 2008).

                                             9
                                              A.

       ACICS contends that the district court erred by determining that ACICS and the

Review Board deprived Bristol of due process by failing to explain the decision to deny

Bristol’s renewal application instead of providing Bristol more time to correct

deficiencies. We conclude that ACICS and the Review Board were not required to

explain that choice to comply with due process.

                                              1.

       The Accreditation Criteria clearly authorized ACICS to deny Bristol’s renewal of

accreditation application based on its numerous and repeated violations of the

Accreditation Criteria. After determining that Bristol was not in compliance with the

Accreditation Criteria, ACICS either could have “take[n] prompt adverse action against

the institution, or . . . require[d] the institution to take appropriate action to bring itself

into compliance with the Accreditation Criteria within a time frame specified by

[ACICS] after the institution has been notified that it is not in compliance.” J.A. 287, 593.

       Over the course of seven months, ACICS conducted two site visits, repeatedly

informed Bristol of its deficiencies, gave Bristol multiple opportunities to respond to

those deficiencies, asked Bristol to explain why its renewal application should not be

denied based on its remaining areas of noncompliance, and provided Bristol a written

explanation for denying its application for renewal of accreditation based on the 24

unresolved violations it identified, none of which Bristol has contested. Nothing more

was required to satisfy due process. See Prof’l Massage Training Ctr., 781 F.3d at 174

(holding that accrediting agency’s denial of school’s application for reaccreditation was

                                              10
not arbitrary and capricious because the school “was afforded ample notice that it was not

in compliance with [the accreditation standards] and numerous opportunities to remedy

identified deficiencies”).

       Furthermore, because the Accreditation Criteria permitted ACICS to deny

Bristol’s renewal of accreditation application due to Bristol’s noncompliance with the

accreditation standards, ACICS was not required to explain why it did not take an

alternative action such as providing Bristol additional time to cure deficiencies. See Inova

Alexandria Hosp. v. Shalala, 244 F.3d 342, 351 (4th Cir. 2001) (“As a general rule, the

consideration of whether a lesser sanction might be adequate should be a step in the path

to the ultimate decision . . . . But this does not mean that the Board’s explanation had to

include express consideration of possible alternatives to its decision.”); see also Motor

Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 51

(1983) (“[A]n agency [need not] consider all policy alternatives in reaching [a]

decision.”). ACICS’s denial letter identifying Bristol’s remaining violations of the

Accreditation Criteria adequately explained its decision not to renew Bristol’s

accreditation, and no further explanation was necessary to satisfy the requirements of due

process.

                                             2.

       The Review Board was similarly under no obligation to provide its rationale for

not granting Bristol more time. The Review Board is a “separate, independent appeals

body” with the power to affirm, amend, or reverse the decision of ACICS, or remand the

case to ACICS with recommendations for further consideration. J.A. 292, 597-98.

                                            11
According to the Accreditation Criteria, “[t]he Review Board panel may amend or

reverse the decision of [ACICS] or remand the case to [ACICS] for further consideration

only if it finds the decision was: (i) arbitrary, capricious, or otherwise in substantial

disregard of the Accreditation Criteria, or (ii) not supported by substantial evidence in the

record on which [ACICS] took the negative action.” J.A. 292, 598. Furthermore, “[t]he

Review Board panel cannot amend or reverse the decision of [ACICS] or remand the

decision based on argument by the appellant that [ACICS’s] action was disproportionate

to the violations cited.” J.A. 292, 598.

       The Review Board complied with the Accreditation Criteria by issuing a written

decision affirming ACICS on the basis that “the action of [ACICS] is supported by

substantial evidence in the record and was not arbitrary and capricious.” J.A. 501. By

determining that ACICS’s decision was supported by substantial evidence and was not

arbitrary and capricious, the Review Board properly conducted its limited review of

ACICS’s actions. Moreover, under the Accreditation Criteria, the Review Board did not

have the authority to amend or reverse ACICS’s decision based on Bristol’s contention

that more time was warranted to come into compliance, as that would violate the

Accreditation Criteria’s prohibition of amending or reversing a decision based on the

argument that “[ACICS’s] action was disproportionate to the violations cited.” See J.A.

292, 598.

                                             B.

       ACICS next argues that the district court erred by finding that ACICS failed to

follow its own internal review procedures when it advanced to the show-cause stage

                                             12
without providing Bristol a compliance warning or clear deadlines for compliance. We

conclude that none of these actions violated the Accreditation Criteria.

       ACICS did not violate its procedures when, in its August 2015 letter, it deferred

action, issued a show-cause directive, and continued Bristol’s accreditation through

December 2015 to allow the school to provide its response. Nothing in the Accreditation

Criteria indicates that ACICS could not simultaneously issue a deferral and a show-cause

directive. ACICS explained in its letter that it was not only deferring action but also

directing Bristol to show cause why its application should not be denied “due to the large

and varied amount of findings incurred at the institution during the on-site evaluation and

the inability to clear these findings in the institution’s response.” J.A. 223. ACICS

followed the Accreditation Criteria’s rules governing deferral, which provide that “[i]n

all cases of deferral on renewal of accreditation of accredited institutions, [ACICS] will

extend the present grant of accreditation for a period sufficient for the institution to

provide the information needed.” J.A. 288, 594. By continuing the current grant of

accreditation, ACICS provided Bristol time to respond and show cause why its

accreditation should not be denied.

       ACICS was not required to issue a compliance warning, and the district court

erred by relying on the compliance warning requirement found in the 2016 Accreditation

Criteria. The compliance warning requirement was added to the Accreditation Criteria

on January 1, 2016, after ACICS had issued its denial letter. Although ACICS submitted

the 2016 version of the Accreditation Criteria to the district court, the 2016 version stated

                                             13
that it was not in effect until January 1, 2016, and that the compliance warning was added

as of that date.

Bristol was not entitled to more time and extended deadlines to achieve compliance. To

the contrary, the Accreditation Criteria would have allowed ACICS to immediately

withdraw Bristol’s accreditation upon determining that Bristol was not in conformance

with the accreditation standards. Although the Accreditation Criteria provide that two

years is the maximum amount of time ACICS would give an institution like Bristol to

come into compliance, ACICS was not required to provide Bristol any minimum amount

of time to remedy its deficiencies. Even so, after finding Bristol noncompliant, ACICS

did not promptly withdraw Bristol’s accreditation but instead provided Bristol with clear

deadlines within which to fix deficiencies: ACICS’s June 2015 renewal of accreditation

visit report requested an explanatory response to the school’s 40 violations of the

Accreditation Criteria by June 25, 2015, and its August 2015 show-cause directive put

Bristol on notice that it could lose its accreditation at ACICS’s December 2015 meeting

and asked Bristol to provide a response to its 37 remaining areas of noncompliance by

October 31, 2015. Accordingly, ACICS did not violate due process by denying Bristol’s

renewal of accreditation application in December 2015 based on 24 unresolved

deficiencies, and the district court erred by finding that Bristol demonstrated a likelihood

of success on the merits. 2

       2
         Although ACICS argues that the district court committed several additional legal
errors in applying the preliminary injunction standard, given our conclusion as to
Bristol’s likelihood of success on the merits, we need not reach the other asserted errors.

                                            14
                                              IV.

       For the forgoing reasons, the district court’s order granting the preliminary

injunction and staying the proceedings is reversed, the stay is vacated, and this case is

remanded for such further proceedings not inconsistent with this opinion as may be

necessary in the discretion of the district court.

                                                REVERSED, VACATED, AND REMANDED

                                              15
WYNN, Circuit Judge, concurring:

       I agree with the majority opinion that the proper result in this case is to vacate the

district court’s order granting a preliminary injunction in favor of Bristol University

(“Bristol”) and against the Accrediting Council for Independent Colleges and Schools

(the “Accrediting Council”). But my reason for vacating the district court’s order is

based on mootness. The district court granted the preliminary injunction on grounds that

Bristol was likely to succeed on the merits of its claim that the Accrediting Council

breached its federal common law due process-like duty to Bristol in deciding to withdraw

Bristol’s accreditation.   But following the district court’s grant of the preliminary

injunction, the Accrediting Council lost its federal recognition as an accrediting agency.

The Accrediting Council’s loss of recognition deprives federal courts of any basis to

afford Bristol relief based on the two causes of action asserted in the complaint, both of

which rest on federal law governing federally recognized accrediting agencies. Thus, this

case is moot, requiring us to vacate the injunction and stay entered by the district court

and to remand with instructions that the case be dismissed without prejudice.

                                          I.

       The Accrediting Council, a not-for-profit accrediting organization, first accredited

Bristol in 1993. In 2012, the Accrediting Council renewed Bristol’s accreditation for a

three-year period, running through December 31, 2015. At the time of the renewal, the

Department of Education recognized the Accrediting Council as a national accrediting

agency, thereby allowing attendees of institutions accredited by the Accrediting

Council—like Bristol—to participate in federal student aid programs. In the fall of 2014,

                                               16
Bristol applied to the Accrediting Council for renewal of its accreditation. In the course

of its accreditation review, the Accrediting Council identified numerous deficiencies in

Bristol’s operations. After Bristol was unable to remedy all of the identified deficiencies,

the Accrediting Council denied Bristol’s application for renewal and withdrew Bristol’s

accreditation.

       Bristol’s complaint alleges that, in withdrawing Bristol’s accreditation, the

Accrediting Council failed to comply with its own procedures and policies, as well as

with procedures and policies for federally recognized accrediting agencies set forth in the

Higher Education Act, 20 U.S.C. § 1099b, and 34 C.F.R. §§ 602.16, 602.25. To that end,

Bristol’s complaint asserted two causes of action. 1        First, Bristol alleged that the

Accrediting Council, in denying Bristol’s application for renewed accreditation, failed to

comply with the due process-like duty imposed on recognized accrediting agencies, in

violation of federal common law. See Prof’l Massage Training Ctr., Inc. v. Accreditation

All. of Career Sch. & Colls., 781 F.3d 161, 169 (4th Cir. 2015). Second, Bristol alleged

       1
          Bristol also sought declaratory and injunctive relief pursuant to 28 U.S.C.
§§ 2201 et seq. The majority rightly notes that the Declaratory Judgment Act does not
“create[] any substantive rights” or provide a standalone cause of action. CGM, LLC v.
BellSouth Telecomms., Inc., 664 F.3d 46, 55–56 (4th Cir. 2011) (citing Skelly Oil Co. v.
Phillips Petroleum Co., 339 U.S. 667, 671–72 (1950)); see also Skelly Oil, 339 U.S. at
671 (explaining that the Declaratory Judgment Act “is procedural only” and “did not
extend [federal courts’] jurisdiction” (internal quotation marks omitted)). Accordingly,
Bristol’s claim under the Declaratory Judgment Act only entitles Bristol to a particular
type of relief in the event that either or both of its substantive causes of action succeed on
the merits. “Stated differently, ‘[a] request for declaratory relief is barred to the same
extent that the claim for substantive relief on which it is based would be barred.’” CGM,
LLC, 664 F.3d at 55–56 (alteration in original) (quoting Int’l Ass’n of Machinists &
Aerospace Workers v. Tenn. Valley Auth., 108 F.3d 658, 668 (6th Cir. 1997)).

                                             17
that the Accrediting Council was negligent per se in denying Bristol’s application for

renewed accreditation, in violation of certain provisions of the Higher Education Act, 20

U.S.C. § 1099b, and its implementing regulations.            The district court granted the

preliminary injunction and stay based on Bristol’s federal common law claim.

       After the Accrediting Council filed its appeal of the district court’s order, the

Department of Education terminated its recognition of the Accrediting Council as a

national accrediting agency. Although the Accrediting Council appealed the Department

of Education’s decision, the Department of Education denied that appeal.                 The

Accrediting Council is challenging the Department of Education’s decision in court,

Accrediting Council for Indep. Colls. & Sch. v. U.S. Dep’t of Educ., No. 1:16-cv-02448-

RBW (D.D.C.), but, as it stands, the Accrediting Council is not a recognized accrediting

agency for purposes of the Higher Education Act. The Accrediting Council’s loss of

federal recognition calls into question the justiciability of Bristol’s claims.

                                            II.

       “Mootness has been described as the doctrine of standing set in a time frame.”

Arizonans for Official English v. Arizona, 520 U.S. 43, 68 n.22 (1997) (internal quotation

marks omitted). Accordingly, a case can become moot due either to a change in facts or

a change in law that undercuts a plaintiff’s basis for asserting standing. See Simmons v.

United Mortg. & Loan Inv., LLC, 634 F.3d 754, 763 (4th Cir. 2011). “[T]o satisfy Article

III’s standing requirements, a plaintiff must show (1) it has suffered an ‘injury in

fact’ . . .; (2) the injury is fairly traceable to the challenged action of the defendant; and

(3) it is likely, as opposed to merely speculative, that the injury will be redressed by a

                                                  18
favorable decision.” Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528

U.S. 167, 180–81 (2000). Due to the Accrediting Council’s loss of federal recognition,

neither of Bristol’s two causes of action provide a basis to redress Bristol’s alleged

injury. As a result, Bristol lacks standing to continue pursuing its claims against the

Accrediting Council, and the present action is thus moot.

       The district court awarded Bristol preliminary injunctive relief based on the

Accrediting Council’s alleged violation of the federal “common law duty on the part of

quasi-public private . . . accreditation associations to employ fair procedures when

making decisions affecting their members.” Prof’l Massage, 781 F.3d at 169 (internal

quotation marks omitted).     This Court first recognized such a duty in Professional

Massage Training Center, Inc. v. Accreditation Alliance of Career Schools & Colleges,

781 F.3d 161 (4th Cir. 2015). This common law “duty was meant to operate as a ‘check

on organizations that exercise significant authority in areas of public concern such as

accreditation and professional licensing.’” Id. at 170 (quoting Thomas M. Cooley Law

Sch. v. Am. Bar Ass’n, 459 F.3d 705, 712 (6th Cir. 2006)). In recognizing the common

law duty, we emphasized that, though they serve important public functions,

“[a]ccreditation agencies are private entities, not state actors, and as such are not subject

to the strictures of constitutional due process requirements.” Id. at 169 (emphasis added).

       Nonetheless, we identified several reasons for imposing a common law due

process-like duty on federally recognized accrediting agencies. Id. at 170. First, in the

Higher Education Act, Congress “delegated to accreditation agencies a decisionmaking

power that affects student access to federal education funding.”         Id.   In particular,

                                             19
accreditation by a recognized accrediting agency is required for institutions of higher

education to access federal student aid funding. See 20 U.S.C. § 1002(a), (b)(1)(D)

(defining an “institution of higher education” as, in part, an institution “accredited by a

nationally recognized accrediting agency or association”); id. § 1070a(a)(1) (requiring

students who receive federal Pell grants to be “in attendance at an institution of higher

education”); id. § 1087aa(b) (allowing “an institution of higher education” to make

federal Perkins loans to eligible students); see also Prof’l Massage, 781 F.3d at 170

(“Accreditation . . . is a prerequisite to Title IV funding and it provides assurance that the

federal loans and grants are awarded to students who will get the education for which

they are paying.”). As a result, “accreditation agencies . . . serve an important quasi-

public role in the dispersal of federal student aid funding.” Prof’l Massage, 781 F.3d at

171. Namely, the Department of Education “rel[ies] on a number of select nationally

recognized accrediting agencies that the Secretary of Education deems to be ‘reliable

authorit[ies] regarding the quality of the education or training provided by’ schools” to

ensure that the institutions that receive federal student aid funding are educating their

students appropriately. Id. (second alteration in original).

       A second “underpinning” of our recognition of this federal common law duty is

“the fact that Congress has given exclusive jurisdiction to United States district courts

over” certain disputes between institutions of higher education and nationally recognized

accrediting agencies. Id. at 170. In particular, the Higher Education Act provides that

“any civil action brought by an institution of higher education seeking accreditation from,

or accredited by, an accrediting agency or association recognized by the Secretary . . .

                                             20
and involving the denial, withdrawal, or termination of accreditation of the institution of

higher education, shall be brought in the appropriate United States district court.” 20

U.S.C. § 1099b(f). Congress’s decision to vest exclusive jurisdiction in federal courts

over this class of disputes “necessarily implies the application of federal law” and

supports the imposition of a federal common law due process-like duty on recognized

accrediting agencies. Prof’l Massage, 781 F.3d at 170 (internal quotation marks omitted)

(quoting Chi. Sch. of Automatic Transmissions, Inc. v. Accreditation All. of Career Sch.

& Colls., 44 F.3d 447, 449 (7th Cir. 1994)).

       In sum, the common law duty under which Bristol sought and obtained relief has

as its foundation the unique role occupied by recognized accrediting agencies by virtue of

their status as government-approved authorities on the quality of educational institutions

and gatekeepers for federal education funding. Id. at 169–70. And Congress’s desire for

federal law to govern alleged violations of this duty is further confirmed by language in

the Higher Education Act providing that such agencies will be subject to federal

jurisdiction in civil actions brought by institutions that have or seek those agencies’

accreditation. Id. at 170.

       In this case, however, the Department of Education’s decision to terminate its

recognition of the Accrediting Council as a national accrediting agency removed the

essential legal predicates underlying Bristol’s federal claims against the Accrediting

Council.   See id.   In particular, the Accrediting Council no longer has the power,

delegated by Congress through the Higher Education Act, to make decisions “affect[ing]

student access to federal education funding,” eliminating the first “underpinning” of the

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common law duty. Id. Only accreditation by a “nationally recognized accrediting

agency or association” renders an entity an “institution of higher education,” 20 U.S.C.

§ 1002(a), (b)(1)(D) (emphasis added), eligible to receive federal student aid funding, id.

§§ 1070a(a)(1), 1087aa(b). Because the Accrediting Council is no longer a “nationally

recognized accrediting agency,” it no longer “serve[s] an important quasi-public role in

the dispersal of federal student aid funding” or “wield[s] . . . life and death power” over

Bristol based on its status as a gatekeeper to that funding. See Prof’l Massage, 781 F.3d

at 170–71.

       Nor can the second “underpinning”—Congress’s grant of exclusive federal

jurisdiction—provide a basis for our recognition of the federal common law cause of

action pleaded in this case. Federal district courts have exclusive jurisdiction over “any

civil action brought by an institution of higher education seeking accreditation from, or

accredited by, an accrediting agency or association recognized by the Secretary.” 20

U.S.C. § 1099b(f) (emphasis added). This exclusive jurisdiction does not, by the express

terms of the statute, extend to civil actions brought by institutions of higher education

that are accredited by or seeking accreditation from agencies—like the Accrediting

Council—that are not recognized by the Secretary of Education.

       Additionally, in Professional Massage, we framed the common law duty as

applying to “quasi-public private . . . accreditation associations.” Prof’l Massage, 781

F.3d at 169 (internal quotation marks omitted). Without the Department of Education’s

recognition, the Accrediting Council is no longer a “quasi-public” accreditation

association. It no longer qualifies as a “reliable authority regarding the quality of the

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education or training provided by” colleges and schools, 34 C.F.R. § 602.16(a), and it no

longer controls access to federal education funding. Indeed, due to the absence of any

connection to the federal government or its activities, there is no reason to subject the

Accrediting Council to the strictures of the due process-like requirements that “quasi-

public” federally recognized accrediting agencies must follow and that serve as the basis

for Bristol’s requested relief.

       Finally, the purpose behind this Court’s recognition of the federal common law

duty at issue would not be served by recognizing the cause of action pleaded in this case.

“The duty was meant to operate as a check on organizations that exercise significant

authority in areas of public concern such as accreditation and professional licensing.”

Prof’l Massage, 781 F.3d at 170 (emphasis added) (internal quotation marks omitted).

Without the Department of Education’s recognition, the Accrediting Council cannot

exercise any authority over an institution of higher education’s access to federal funds,

nor can it exercise the federal government’s delegated authority in a way that “gives the

public some assurance that” the schools and programs the Accrediting Council accredits

are providing satisfactory education and training. Id. at 171.

       Bristol’s negligence per se action—which the district court did not rely upon in

imposing the preliminary injunction—likewise only relates to federally recognized

accrediting agencies. In particular, Bristol alleged that the Accrediting Council engaged

in negligence per se because it did not comply with certain procedural requirements set

forth in Section 1099b, and its implementing regulations, in deciding not to renew

Bristol’s accreditation.     But those statutory requirements apply only to federally

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recognized accrediting agencies. Accordingly, because the Accrediting Council is no

longer federally accredited, Section 1099b and its implementing regulations no longer

govern the Accrediting Council’s conduct.

       In sum, the Department of Education’s decision to terminate its recognition of the

Accrediting Council as a nationally recognized accrediting agency eliminated any basis

for relying on federal law to afford Bristol relief. Since Bristol’s complaint seeks relief

only under federal law, there is no longer any basis to redress Bristol’s alleged injury. As

a result, I would dismiss this case as moot.

                                          III.

       Because Bristol’s action is moot, I join the majority in vacating the preliminary

injunction and stay entered below. I would therefore remand this matter to the district

court with instructions to dismiss this suit without prejudice. 2 See United States v.

Munsingwear, Inc., 340 U.S. 36, 39 (1950) (“The established practice of the Court in

dealing with a civil case from a court in the federal system which has become moot while

on its way here or pending our decision on the merits is to reverse or vacate the judgment

below and remand with a direction to dismiss.”).

       2
         I offer no view regarding whether Bristol may base a claim for relief on another
cause of action, such as a breach of contract claim under state law, or whether Bristol
may refile its federal common law claim in the event that the Department of Education
reinstates the Accrediting Council’s recognition. I simply note that there is no cause of
action currently before this Court that affords a basis for redressing Bristol’s alleged
harm.

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