Legal Overview, Summary & Analysis
There was widespread disappointment with yesterday’s ruling, in which Judge O’Connor decided in favor of the government in the Gainful Employment (“GE”) case. A copy of the opinion is available here. The decision is still under detailed review, but a brief summary and analysis are provided below. The court began by addressing the Loper Bright issue, that is, whether the Department even had the authority to issue the GE rule. Consistent with its prior ruling on Ogle’s motion for a preliminary injunction, the court again accepted the government’s definition of “gainful,” meaning “‘profitable,’ advantageous,’ or ‘lucrative.’” The court did not wrestle with several of the statutory interpretation arguments that we made, apparently because it found that the phrase “gainful employment” is so unambiguous that no further statutory analysis is necessary. This, of course, stands in contrast to several other district court decisions that have found the phrase to be ambiguous— and prior positions of the Department— decisions that this judge acknowledged but “is not bound to follow.” Next, the court turned to (some of) our arbitrary and capricious arguments. The court seems to have accepted the government’s arguments and studies without any critical analysis. Put another way, the judge accepted the government’s characterizations of its studies and findings at face value and, as a result, held that the GE rule is not arbitrary. The judge barely—if at all—dealt with the internal contradictions and counter-evidence we identified in the administrative record. The judge did not even acknowledge, for example, our argument that the government withheld data that it later used to justify the GE rule. Finally, the court rejected our First Amendment and Due Process arguments. Consistent with the remainder of the opinion, the court did not address many of the arguments in our briefing, including the principal case we cited in support of our First Amendment argument. The court simply said that First Amendment challenges to federal funding conditions are not permitted as a matter of law. On the Due Process piece, the court effectively added language into the GE rule that does not appear therein. AACS can appeal this as a matter of right. A notice of appeal is due within 60 days. We are evaluating our options with our legal and GR teams to ensure that we are doing everything possible to get to the right outcome for our students and members. | 
