640 F. App'x 5
D.C. Cir.2016Background
- The Association of Private Sector Colleges and Universities (APSCU) challenged the Department of Education’s 2014 “gainful employment” Rule, which defines when programs prepare students for "gainful employment" and establishes debt-related metrics determining Title IV student aid eligibility.
- The 2014 Rule ties program eligibility to metrics measuring whether graduates earn enough to repay student loan debt and imposes reporting requirements for program-level student data.
- The district court granted summary judgment for the Department, upholding the Rule against statutory (Chevron) and arbitrary-and-capricious challenges and validating the reporting requirement.
- APSCU appealed, arguing (1) the statute’s text foreclosed the Department’s interpretation or the interpretation was unreasonable, (2) the debt metrics were arbitrary and capricious, and (3) the reporting requirement exceeded statutory authority and was nonseverable.
- The D.C. Circuit reviewed de novo, concluded the statutory phrase “program of training to prepare students for gainful employment in a recognized occupation or profession” is ambiguous, deferred to the Department under Chevron, rejected the arbitrary-and-capricious challenges, and upheld the reporting requirement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the statutory phrase "program of training to prepare students for gainful employment" is unambiguous | The phrase requires only training for paying jobs; statutory text forecloses Department’s earnings-focused interpretation | The phrase is ambiguous; Department reasonably interprets it to mean training that leads to earnings sufficient to repay loan debt | Court: Phrase ambiguous; Chevron deference applies; Department's interpretation reasonable and upheld |
| Whether the 2014 debt metrics and rulemaking were arbitrary and capricious | Metrics are arbitrary, inadequately justified, and result from flawed rulemaking | Department provided analysis, responded to comments, and adjusted metrics after prior vacatur; record supports reasoned decisionmaking | Court: Agency action not arbitrary or capricious; upheld metrics |
| Whether the reporting requirement exceeds statutory authority or is nonseverable | Reporting requirement conflicts with 20 U.S.C. § 1015c and is unlawful; if invalid, entire rule must fall | Reporting limited to Title IV recipients and integrated into existing National Student Loan Data System; falls within §1015c exception | Court: Reporting requirement lawful and severable; upheld |
| Whether prior vacatur of 2011 rule controls validity of 2014 rule | (Implicit) Prior vacatur implies similar provisions unlawful | 2014 Rule addressed prior defects and differs in scope/limits | Court: 2014 Rule adequately distinguishes and remedies prior concerns; upheld |
Key Cases Cited
- Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837 (establishes two-step deference to reasonable agency interpretations of ambiguous statutes)
- Association of Private Sector Colleges & Universities v. Duncan, 681 F.3d 427 (D.C. Cir. 2012) (prior D.C. Circuit decision addressing Title IV regulatory scope and statutory context)
- Ass'n of Private Sector Colls. & Univs. v. Duncan, 110 F. Supp. 3d 176 (D.D.C. 2015) (district court opinion upholding 2014 Rule; relied upon by this opinion)
- Ass'n of Private Sector Colls. & Univs. v. Duncan, 930 F. Supp. 2d 210 (D.D.C. 2013) (district court vacating 2011 rule reporting requirement; distinguished from 2014 Rule)
- Ass'n of Private Sector Colls. & Univs. v. Duncan, 870 F. Supp. 2d 133 (D.D.C. 2012) (district court vacating 2011 rule debt metrics; background for 2014 rulemaking)
- Helms v. Monsanto Co., 728 F.2d 1416 (11th Cir. 1984) (illustrative interpretation of "gainful employment" in a different statutory context)