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The Century Foundation v. Devos

United States District Court, S.D. New York

February 15, 2018

BETSY DEVOS, in her official capacity, and the UNITED STATES DEPARTMENT OF EDUCATION, Defendants.

          OPINION & ORDER


         Plaintiff, The Century Foundation ("TCF"), moves for a Temporary Restraining Order ("TRO") and Preliminary Injunction ("PI") against the United States Department of Education ("Department"), seeking to (1) compel the Department to expedite its Freedom of Information Act ("FOIA") request for documents that TCF believes are necessary for it to comment on the Department's upcoming decision to grant official recognition to certain higher education accrediting agencies, and (2) extend the notice and comment period, which the Department scheduled to end on February 16, 2018, until 21 days after the documents have been produced. Dkt. No. 9. Upon holding a hearing and considering the arguments, the Court hereby GRANTS a TRO, and defers decision on a PI until further argument by the parties at another hearing in one week's time (or at a later time if both parties consent).


         Any institution participating in the Title IV student financial assistance programs must be accredited by an accrediting agency "recognized" by the Secretary of the Department of Education to be a reliable authority as to the quality of education or training being offered. See 20 U.S.C. §§ 1001, 1099b. The Department does not accredit institutions of higher education. Rather, as required by Congress, see 20 U, SC § 1099b(o), the Department has established a process for accrediting agencies to apply for recognition, has set standards governing agency recognition, and has developed a process for ongoing monitoring of accrediting agencies. See generally 34 C.F.R. Part 602.

         By statute, the Secretary is required to engage in "solicitation of third-party information concerning the performance of the accrediting agency or association." 20 U.S.C. § lO99b(n)(1)(A). Further, federal regulation enacted pursuant to this statute requires that the "Department staff publish[] a notice of the agency's application or report in the Federal Register inviting the public to comment on the agency's compliance with the criteria for recognition and establish[] a deadline for receipt of public comment." 34 C.F.R. § 602.32(a). Once Department staff complete their evaluation, which includes a "[r]eview of the public comments, " id. § 602.32(b)(2), it "prepares a written draft analysis" and sends the draft, "including all third-party comments the Department received by the established deadline" to the accrediting agency under review so that it may respond prior to the staff finalizing its analysis report and recommendation to a "Senior Department Official" or "SDO." Id. §§ 6O2.32(b)(3)-(5), (f)(1)-(5). The final staff analysis is also provided to the National Advisory Committee on Institutional Quality and Integrity ("NACIQI"), a federal advisory committee subject to the Federal Advisory Committee Act, including "written third-party comments the Department received about the agency on or before the established deadline." Id. §§ 602.31(f)(3), 6O2.34(c)(4)-(5). All documents provided to NACIQI are to be made available to the public. Id. § 602.31(f)(2). NACIQI then makes its own recommendation, which it forwards to the SDO, who has the authority to make a decision on behalf of the Department. Id. § 602.36.

         On January 24, 2018, the Department published a notice in the Federal Register. See 83 Fed. Reg. 3335 (Jan. 24, 2018) (hereinafter the "Solicitation"). The Solicitation notified the public that one agency, the Accrediting Council for Independent Colleges and Schools ("ACICS"), submitted an application for initial recognition, and seven other agencies applied for renewal of recognition. It also notified the public that the American Bar Association ("ABA") and three other agencies submitted compliance reports previously ordered by the Department. The Solicitation called for third-party comments "concerning the performance of accrediting agencies" as required by statute and regulation. It also explained that "[t]hese accrediting agencies will be on the agenda for the Spring 2018 National Advisory Committee on Institutional Quality and Integrity meeting. The meeting date has not been determined, but will be announced in a separate Federal Register notice."

         The Solicitation stated that written comments "must be received" by February 16, 2018, and it further specified that "[o]nly written material submitted by the deadline to the email address listed in this notice, and in accordance with these instructions, become part of the official record concerning agencies scheduled for review and are considered by the Department and NACIQI in their deliberations." Regarding the compliance reports in particular, the Solicitation stated that "[c]omments about an agency's recognition after review of a compliance report must relate to issues identified in the compliance report." It concluded, "A later Federal Register Notice will describe how to register to provide oral comments at the meeting about the recognition of a specific accrediting agency or State approval agency."

         The day the Solicitation became public, TCF submitted two FOIA requests to the Department, asking for disclosure of the application submitted by ACICS and the compliance report submitted by the ABA. See Habash Decl. ¶ 11; Compl. Exs. B, C. TCF, a nonpartisan, non-profit section 501(c)(3) organization, devotes substantial resources to ensuring that accrediting agencies comply with the standards for recognition. See Habash Decl. ¶ 3. TCF intended to use the application and compliance report to provide an informed response to the Solicitation. As such, TCF also requested expedited processing in light of the looming deadline for written third-party comments. See Compl. Ex. B at 1-3, Ex. C at 1-4. On February 6, 2018, the Department informed TCF that it denied the requests for expedition. See Habash Decl. ¶ 17; Compl. Exs. F & G. TCF then initiated this action.

         On February 8, 2018, TCF filed a Complaint against the Department, seeking declaratory and injunctive relief. Upon filing the complaint, TCF e-mailed the Department with a courtesy copy of the Complaint and informed it that TCF was preparing to file for emergency relief unless a resolution could be reached. Elson Decl. Ex. 1. The Department declined to respond. On February 12, 2018, TCF again reach out to the Department but received no response. Id. On February 13, 2018, TCF moved for a temporary restraining order ("TRO") and preliminary injunction ("PI"), and the Court issued an order to show cause. Dkts. 14-15. Today, two days later, both parties appeared at a hearing, and the Court is prepared to rule on a TRO.


         Federal Rule of Civil Procedure 65(a)(1) provides that a "court may issue a preliminary injunction only on notice to the adverse party." Although the Rule does not specify when notice must be given, Rule 6(c) states that any motion must be served, along with notice of the hearing thereof, at least 14 days before the time set for the hearing. Fed.R.Civ.P. 6(c). Although the Court has discretion to modify this period when the urgency that is characteristic of the preliminary-injunction context warrants it, see Anderson v. Davila, 125 F.3d 148, 156 (3d Cir. 1997), the Court declines to exercise that discretion here, where the Department asserts that its operations will be impaired by a long delay in the recognition process and the Court believes that further argument and evidence regarding the Department's processes would be helpful. Hence, the Court finds it appropriate to grant only a TRO at this stage. Nevertheless, the Court exercises its discretion to schedule the next hearing for February 22, 2018, which is only 9 days from the date the motion was filed but 14 days from the date TCF provided notice of the Complaint and its intent to seek emergency relief. Per Rule 65(b)(2), the TRO will expire 14 days from today, on March 1, 2018, barring the grant or denial of a preliminary injunction before that date.

         "It is well-established that in this Circuit the standard for an entry of a TRO is the same as for a preliminary injunction." Nat'l Football League Mgmt. Council v. Nat'l Football League Players Ass'n, No. 17-cv-6761, 2017 WL 4685113, at *1 (S.D.N.Y. Oct. 17, 2017). A party seeking a preliminary injunction must show "(a) irreparable harm and (b) either (1) likelihood of success on the merits or (2) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly toward the party requesting the preliminary relief." Citigroup Global Mkts., Inc. v. VCG Special Opportunities Master Fund Ltd., 598 F.3d 30, 35 (2d Cir. 2010).

         The Court finds that TCF is entitled to a TRO prohibiting the Department from enforcing the deadline to submit written comments concerning ACICS and the ABA until the Court is in a position to rule on the PI. Specifically, at least with regard to its Administrative Procedure Act ("APA") claim seeking to extend the comment period, TCF has demonstrated serious questions going to the merits to make them a fair ground for litigation, irreparable harm, and a balance of hardships tipping decidedly in its favor. At this time, the Court expresses no opinion on the merits of TCF's claim that the Department also violated FOIA by declining the requests for expedition.

         First, TCF has established "serious questions going to the merits to make them a fair ground for litigation." Citigroup Global Mkts., 598 F.3d at 35. In a challenge to agency action or inaction under the APA, a reviewing court shall "determine all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of terms of an agency action." 5 U.S.C. § 706. If a court determines that an agency action is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law, " then it "shall. .. hold unlawful and set aside [such] agency action." Id. ยง 706(2). TCF argues that the Department's conduct is arbitrary and capricious because it has denied public ...

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