96 F.4th 707
4th Cir.2024Background
- N.H., a student at Concordia Preparatory School, and her mother (Buettner-Hartsoe) sued the school alleging violations of Title IX following claims of sexual harassment and assault.
- Concordia Prep is a private Lutheran school with 501(c)(3) tax-exempt status, but it denies receiving any direct federal financial assistance.
- Plaintiffs argued the school’s federal tax-exempt status should qualify as receipt of federal financial assistance, making it subject to Title IX.
- The district court agreed with Plaintiffs, finding tax exemption qualified as federal financial assistance for Title IX purposes, and denied Concordia Prep’s motion to dismiss.
- However, the court certified the question for interlocutory appeal; the Fourth Circuit granted review solely to resolve if 501(c)(3) status constitutes federal financial assistance under Title IX.
- The Fourth Circuit reversed, holding that § 501(c)(3) status alone does not trigger Title IX’s coverage.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does 501(c)(3) tax-exempt status qualify as "receiving federal financial assistance" for Title IX purposes? | Tax-exempt status and corresponding donation incentives operate as federal financial assistance, thus subjecting Concordia Prep to Title IX. | Tax exemption is merely a tax benefit (not an affirmative grant of funds); no actual receipt of federal funds or support. | 501(c)(3) status is not "federal financial assistance." Tax exemption is not the same as a direct or indirect grant of federal aid. |
Key Cases Cited
- Grove City Coll. v. Bell, 465 U.S. 555 (1984) (Title IX applies if an institution receives federal funds, even if aid passes through intermediaries, but only when funds are actually received)
- U.S. Dep’t of Transp. v. Paralyzed Veterans of Am., 477 U.S. 597 (1986) (differentiates between recipients of federal financial assistance and entities that merely benefit indirectly)
- Nat’l Collegiate Athletic Ass’n v. Smith, 525 U.S. 459 (1999) (Title IX does not cover entities that merely benefit from, but do not receive, federal assistance)
- Bob Jones Univ. v. United States, 461 U.S. 574 (1983) (tax exemption is a government benefit but not always equivalent to a cash subsidy or financial assistance)
- Walz v. Tax Comm’n of New York, 397 U.S. 664 (1970) (tax exemption does not constitute a transfer of public money as a subsidy does)