Wards Corner Beauty Acad., Corp. v. Nat'l Accrediting Comm'n of Career Arts, 922 F.3d 568

Wards Corner Beauty Academy (WCBA), a Virginia cosmetology/barbering school, had accreditation withdrawn by NACCAS in 2016 after reporting sub‑50% graduation rates and failing (after supplementation) to demonstrate compliance.
NACCAS uses File Review Teams (three Commissioners) to investigate school actions and then the full Commission votes; WCBA’s file was considered in Feb. 2016 when a File Review Team recommended withdrawal.
Michael Bouman, NACCAS Chairman, filled in on a File Review Team that recommended WCBA’s accreditation be withdrawn; he was President/COO and minority shareholder of a nearby school operator (EEG) but did not vote in the full Commission and claimed unawareness of any conflict.
WCBA sued in federal court, alleging common‑law due process violations based on (1) Bouman’s alleged pecuniary interest, (2) NACCAS’s failure to follow its own conflict rules, and (3) prejudgment by combining investigative and adjudicative roles.
After a bench trial the district court found any financial interest of Bouman was speculative/slight, NACCAS’s internal rules did not create a stricter disqualifying standard, and WCBA waived its prejudgment argument; the district court denied relief.
The Fourth Circuit affirms: it applies deferential review to accrediting decisions and concludes WCBA failed to show a disqualifying pecuniary interest, a rule‑violation giving rise to due process relief, or a preserved claim of prejudgment.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Bouman’s participation denied an impartial decisionmaker because of a pecuniary interest	Bouman’s role at EEG and stock/salary/bonuses created a financial interest that could tempt him to favor EEG by harming WCBA	Bouman’s connection to EEG was remote/speculative: limited competition, geographic/distance and curricular barriers, only minimal student transfers, no direct financial gain tied to the decision	No due process violation; interest was slight/speculative and did not rebut presumption of honesty and integrity
Whether failure to follow NACCAS’s internal conflict rules independently violated due process	NACCAS breached its rules requiring disclosure/recusal, so WCBA’s procedural rights were violated per Professional Massage framework	NACCAS’s rules require fact‑specific conflict evaluation and do not impose a stricter disqualifying standard than common law due process	No; rules do not set a higher disqualifying standard here and rule noncompliance did not show denial of impartial decisionmaker
Whether File Review Team members prejudged decisions by acting as investigators and adjudicators	Combining investigative/prosecutorial and adjudicative functions deprived WCBA of fair procedure	Issue was not timely raised below; district court lacked fair notice to address prejudgment theory before trial	Court declined to consider on appeal due to waiver/forfeiture; district court correctly found issue untimely

Professional Massage Training Ctr., Inc. v. Accreditation All. of Career Sch. & Colls., 781 F.3d 161 (4th Cir. 2015) (accrediting agencies owe common‑law duty to use fair procedures; focus on internal rules and whether followed)
Aetna Life Ins. Co. v. Lavoie, 475 U.S. 813 (U.S. 1986) (slight or speculative pecuniary interests do not require recusal; due process implicated by direct, personal, substantial interest)
Gibson v. Berryhill, 411 U.S. 564 (U.S. 1973) (due process violated where adjudicators would directly inherit plaintiffs’ business; direct and substantial competitive interest disqualifies)
Caperton v. A.T. Massey Coal Co., 556 U.S. 868 (U.S. 2009) (appearance of bias can violate due process when an objective risk exists that the decisionmaker was tempted by financial interests)
Stivers v. Pierce, 71 F.3d 732 (9th Cir. 1995) (appearance of partiality can suffice; excluding all practitioners with some competitive interest would unduly limit board composition)