Cases & Developments - National Association of College and University Attorneys

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Latest Cases & Developments

Date:
11/1/2024
Letter from 25 Attorneys General to Columbia University Regarding Potential Divestment (Oct. 23, 2024)
Letter to Columbia University from twenty-five Attorneys General encouraging the University to resist demands to divest from Israel. The Letter “commend[s] [the] University for its [prior] decision … to not divest from Israel” and urges it to “maintain that position.” The Letter cites a similar letter previously sent to Brown University, wherein the authors asserted that divestment “could trigger laws in nearly three-fourths of States prohibiting [them] from associating with entities that discriminate against Israel, Israelis, or their business partners.”
Topics:
Endowments & Gifts | Public Private Partnerships | Taxes & Finances
Date:
10/25/2024
GASB Issues Statement 104 on Disclosure of Certain Capital Assets (Oct. 17, 2024)
The Governmental Accounting Standards Board (GASB) announced its issuance of Statement No. 104 on Disclosure of Certain Capital Assets (the Statement). This Statement will require certain capital assets to be disclosed separately for the purposes of note disclosures. Specifically, disclosure requirements for intangible capital assets relating to leases, public-private partnerships, and subscription-based information technology arrangements (SBITA). Finally, the Statement introduces a new disclosure for capital assets held for sale.
Topics:
Taxes & Finances
Date:
10/18/2024
Douglas v. The President & Fellows of Middlebury Coll. (Vt. Super. Oct. 3, 2024)
Opinion and Order granting in part and denying in part Defendant’s Motion for Summary Judgment. Plaintiff, the administrator of the estate of the former Governor of Vermont, brought claims of breach of contract, and unjust enrichment challenging Middlebury College’s decision to remove the Mead name from their campus chapel. In 1914, former Vermont Governor John Mead provided Middlebury College with the financial resources to build a chapel on its campus, which the College named the Mead Memorial Chapel. A century after Governor Mead’s passing, the College decided to remove the Mead name from the chapel. Plaintiff, the appointed special administrator for former Governor Mead’s estate, sued the College, alleging breach of the contract between the College and Mead, which included an alleged name condition. The College argued the chapel was a gift, that there is no name condition-subsequent attached to the gift, and that Mead’s intentions were donative in nature. The court, unable to determine whether the 1914 transaction falls into the category of a contract or a gift, held that the issue must be determined on the evidence at trial. The court found the College entitled to preliminary summary judgment because any naming condition is unenforceable if the transaction is determined to be a gift at trial. However, if the lower court finds the existence of a contract, questions remain as to whether the contract includes terms requiring the chapel to retain the name “Mead Memorial Chapel” in perpetuity. The court dismissed plaintiff’s unjust enrichment claim in light of plaintiff’s inability to demonstrate the retained benefit the College is receiving from the name change. In denying summary judgment related to the claim for breach of good faith and fair dealing, the court held that the jury must first resolve the question of fact as to whether the transaction was a gift or a contract.
Topics:
Endowments & Gifts | Taxes & Finances
Date:
10/18/2024
Choh v. Brown Univ. (D. Conn. Oct. 9, 2024)
Opinion granting Defendants’ Motion to Dismiss. Plaintiffs, current and former student athletes, filed a putative class action, claiming a violation of Section 1 of the Sherman Act, 15 U.S.C. § 1 against Brown University, the Trustees of Columbia University in the City of New York, Cornell University, the Trustees of Dartmouth College, Harvard University, the Trustees of the University of Pennsylvania, Princeton University, Yale University, and the Ivy League Council of Presidents. Plaintiffs allege the Universities formed a price-fixing agreement, referred to by the Universities as “the Ivy League Agreement,” “not to provide athletic scholarships to their Division I Athletes and not to pay Ivy League Athletes any compensation (or reimbursement of education-related expenses).” Plaintiffs further allege the Agreement is per se illegal because the Universities are “horizontal competitors in the commercial activities in the Relevant service markets.” The Universities argued that they hold authority in setting rules for financial aid and compensation, and the ban on sports scholarship is meant to “foster campus cultures that do not prioritize athletics.” In finding that plaintiffs do not allege a cognizable antitrust violation, a restraint that violates the Rule of Reason, or the requirements for defining a plausible relevant market, the court wrote “at best, the plaintiffs’ allegations of anticompetitive effects relate to just some market participants, not effects in the market as a whole.”
Topics:
Antitrust | Athletics & Sports | Financial Aid, Scholarships, & Student Loans | Students | Taxes & Finances
Date:
8/9/2024
Updated Form I-9, Employment Eligibility Verification (Aug. 12, 2024)
U.S. Citizenship and Immigration Services updated the Form I-9, Employment Eligibility Verification to extend the expiration date to May 31, 2027. Employers should use the Form I-9 with the August 1, 2023, edition date which may have an expiration date of either July 31, 2026, or May 31, 2027. Starting July 31, 2026, employers must use the Form I-9 version with the May 31, 2027, expiration date. Employers are encouraged to update their electronic Forms I-9 systems to use the May 31, 2027, expiration date no later than July 31, 2026.
Topics:
Taxes & Finances
Date:
7/12/2024
ACE Issue Brief on Student Voting and College Political Campaign-Related Activities (June 24, 2024)
Issue Brief from the American Council on Education (ACE) on Student Voting and College Political Campaign-Related Activities in 2024. The Issue Brief notes the obligation under the Higher Education Act (HEA) to make good faith efforts to help students to register to vote in federal and gubernatorial election cycles and discusses resources related to voter registration, as well as barriers to student voting. It also considers challenges associated with the Internal Revenue Code’s prohibition on 501(c)(3) organizations from participating in political campaign-related activity. Finally, it presents illustrative examples of permissible and prohibited political activities on campus.
Topics:
Accreditation, Authorizations, & Higher Education Act | Higher Education Act (HEA) | Tax Implication of Campus Political Activity | Taxes & Finances
Date:
6/14/2024
DOJ Proposed Final Judgment in Ohio v. Nat’l Collegiate Athletics Ass’n (June 11, 2024)
Department of Justice (DOJ) Antitrust Division Proposed Final Judgment and Competitive Impact Statement in Ohio v. Nat’l Collegial Athletics Ass’n. The Department of Justice joined ten states and the District of Columbia in suing the National Collegiate Athletics Association (NCAA), challenged NCAA Bylaw 14.5.5.1 (“Transfer Eligibility Rule”), which requires a one-year delay in eligibility for certain athletes transferring between institutions, alleging that it “unjustifiably restrains the ability of these college athletes to engage in the market for their labor as NCAA Division I athletes.” “The proposed Final Judgment, filed on May 30, 2024, requires the NCAA to refrain from enforcing the offending rules and to restore eligibility to certain affected athletes.” Public comment is due within 60 days of the publication of the notice in the Federal Register.
Topics:
Antitrust | Athletics & Sports | Athletics Compliance & NCAA Rules | Taxes & Finances
Date:
6/7/2024
Pearson Foundation v. The Univ. of Chi. (N.D. Okla. June 5, 2024)
Memorandum and Order granting Defendant’s Supplemental Motion for Partial Summary Judgment. Plaintiff, the Thomas L. Pearson and Pearson Family Foundation, brought contract and breach of duty of good faith and fair dealing claims against the University of Chicago, alleging that the University had not fulfilled its obligations in staffing an institute the Foundation had committed $100 million to create. The University counterclaimed for failure to make a $13 million installment when due. The Foundation objected, in particular, to the University’s designation of current faculty for two of three endowed chairs, asserting they were unqualified. The court previously partially denied summary judgment without prejudice, holding that the Foundation could pursue the contract claim on the grounds that the hires did not fulfill the institute’s mission, even though the Grant Agreement included no specific qualifications for the appointments and provided that the Foundation no role in the selection process or in setting the institute’s research agenda. In a surreply to the University’s supplemental motion for partial summary judgment, the Foundation objected that discovery suggested that the University departed from its normal faculty hiring procedures. In granting the motion, the court held that the Foundation had abandoned its express contract claim in its briefing but may still proceed on its good faith and fair dealing claim as to the hiring process.
Topics:
Contracts | Endowments & Gifts | Taxes & Finances
Date:
5/24/2024
Nelson v. St. Catherine Univ. (D. Minn. May 21, 2024)
Order denying Defendants’ Motions to Dismiss. Plaintiff, a former student at St. Catherine University, brought Bankruptcy Code automatic stay violation and common law intrusion upon seclusion claims against both the University and its outside counsel (the Firm), and alleged that the Firm violated multiple provisions of the Fair Debt Collection Practices Act (FDCPA). In May 2023, as a “Collection Action” brought by the Firm on behalf of the University was ramping up before a district “Collection Court,” plaintiff filed for bankruptcy before a federal “Bankruptcy Court.” Following the Bankruptcy Court issuing notice of the “Bankruptcy Matter” Plaintiff was arrested on a bench warrant from the Collection Court. Then, after plaintiff’s counsel emailed the Firm and University additional information and the Firm was added to the Bankruptcy Matter, the Firm did not notify plaintiff’s counsel of a rescheduled hearing in the Collection Action. Once plaintiff’s counsel notified the Collection Court of the Bankruptcy Matter, the Collection Action was stayed. Subsequently, Plaintiff initiated a tertiary civil action against the Firm and University related to these alleged actions. Upon finding no irreconcilable conflict between the Bankruptcy Code and the FDCPA that would repeal the FDCPA provisions by implication, the court found plaintiff had alleged sufficient facts to proceed on her FDCPA improper communication, false or misleading representations, threat to take action, and unfair practices claims. Noting that the FDCPA claims were largely predicated on the same underlying facts, the court declined to refer the Bankruptcy Code violation claims to the Bankruptcy Court. It likewise retained jurisdiction over her tort claims.
Topics:
Bankruptcy & Student Debt | External Counsel | General Counsel | Litigation, Mediation & Arbitration | Taxes & Finances | Tort Litigation
Date:
3/1/2024
Tennessee v. Nat’l Collegiate Athletics Ass’n (E.D. Tenn. Feb. 23, 2024)
Memorandum Opinion and Order granting Plaintiffs’ Motion for a Preliminary Injunction. Plaintiffs, the State of Tennessee and the Commonwealth of Virginia, as parens patriae on behalf of their student-athletes, brought antitrust claims against the National Collegiate Athletics Association (NCAA), asserting that the NCAA’s classification of name, image, and likeness (NIL) collectives as “boosters” that are prohibited from engaging in recruiting activities on behalf of a school, including discussions of potential NIL deals with student-athletes before they commit to a particular school, is “an ‘illegal agreement to restrain and suppress competition’ within the labor market of Division I athletics.” In preliminarily enjoining enforcement of the NCAA rules regarding the “NIL-recruiting ban” and Rule of Restitution, the court ruled that plaintiffs were likely to succeed on the merits, finding that (1) the balance between academics and athletics and the distinction between collegiate and professional athletics could be achieved by less restrictive rules, (2) the ban is anticompetitive for student-athletes even if it spreads competition evenly among member institutions, and (3) the social justification of protecting vulnerable students was not relevant to whether the rules are lawful. In finding that plaintiffs had sufficiently alleged irreparable harm, the court noted that the alleged harms of stripping student-athletes of some of their negotiating leverage and keeping them from knowing their full NIL value are not strictly monetary.
Topics:
Antitrust | Athletics & Sports | Athletics Compliance & NCAA Rules | Taxes & Finances

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