Private Education Matters
STUDENTS
EMPLOYEES
Contributors:
Grace Chan
Partner | San Francisco
Jordan Carman
Associate | San Francisco
Hannah Dodge
Associate | San Francisco
Christopher Fallon Partner | Los Angeles
Stephanie Lowe
Senior Counsel | San Diego
Madison Tanner
Associate | San Diego
Reece Martin
Summer Associate | San Diego
Legislation
New Notice Requirement Under California’s Expanded Victims’ Leave Law (AB 2499).
As of July 1, 2025, California employers, including private schools, are required to provide a new employee notice issued by the Civil Rights Department (CRD) concerning leave and accommodations for victims of crime or abuse. This requirement stems from AB 2499, which went into effect on January 1, 2025, and expanded both leave rights and accommodation protections under state law.
AB 2499 allows employees to take up to 12 weeks of job-protected leave if they are a victim of certain acts of violence, or if they are the family member of someone who has died as a result of such an act. Covered acts include domestic violence, sexual assault, stalking, and other forms of serious violence. Employers are also required to consider and, where appropriate, provide safety-related accommodations to affected employees.
The CRD’s updated materials include a model notice and a set of frequently asked questions. These materials provide important guidance regarding when employees may request time off, what types of accommodations may be appropriate, and the protections in place against discrimination and retaliation. The FAQs clarify that employees may support their leave or accommodation requests with a variety of documentation, such as police or court records, letters from service providers, or a signed statement from the employee or someone acting on their behalf.
Schools are required to provide the notice (or a substantially similar version) to employees:
• At the time of hire;
• Once per year to all employees;
• Upon request; and
• Whenever an employee discloses that they or a family member has been the victim of a qualifying act.
Note:
Schools should ensure this new notice is distributed as required and should review and update employee handbooks to reflect the expanded rights under AB 2499. It is also important to train administrative and HR staff on how to respond to requests for leave or accommodations under this law. LCW is available to assist with making these handbook updates and providing training for administrators.
President Trump Signs The Educational Choice For Children Act.
On July 4, 2025, President Trump signed the Educational Choice for Children Act (ECCA) into law. The program is scheduled to take effect on January 1, 2026.
The ECCA creates a federal tax credit program designed to expand educational opportunities by incentivizing donations to Scholarship Granting Organizations (SGOs). These SGOs will award scholarships to eligible students to help cover a range of educational expenses, including tuition at private and independent schools. The law includes specific limits on tax credits and eligibility criteria for recipients.
Although the ECCA is a federal initiative, its implementation is state-dependent. Each state, and the District of Columbia, must formally opt in for the program to become available to its residents. If a state participates, individuals and corporations may begin making qualifying donations and receiving the corresponding federal tax credits.
At this time, it is uncertain whether California will opt into the program. LCW will continue to monitor developments closely and provide updates as more information becomes available.
Governance
Federal Court Dismisses Retaliation Suit By Former Trustee Over COVID-19 Funding Disputes.
Marshall Austin, a former federal prosecutor, served as a volunteer trustee on the Board of Charleston Day School, an independent school in South Carolina, from June 2021 to February 2022. His three children attended the School from 2019 through 2022. During his tenure, the School had received two forms of federal COVID-19 relief: (1) a $570,200 Paycheck Protection Program (PPP) loan, later fully forgiven, and (2) approximately $80,000 in services and reimbursements through the Emergency Assistance to Nonpublic Schools (EANS) program.
Austin became concerned about the School’s use of these funds. In late 2021, he accessed internal records via the Board’s online portal and raised questions with other trustees and the Head of School, Judith Arnstein. He requested archived meeting minutes and, in February 2022, contacted the U.S. Attorney’s Office to report possible misuse of federal funds. The day after he notified federal authorities, the School called a special Board meeting, where Austin was removed as a trustee by a 12-0 vote (with two abstentions), and the Board voted not to renew enrollment for his three children. These votes were made in accordance with the Board’s Bylaws.
The School cited several reasons for these actions, including Austin’s alleged breaches of confidentiality, disruptive conduct, threats of litigation, breach of fiduciary duties, and violation of parent conduct standards due to his wife’s contentious interactions with staff regarding COVID-19 policies.
The False Claim Act (FCA) is an anti-fraud statute that imposes liability on individuals or entities that submit false claims or false statements to the federal government. Austin filed suit under the FCA’s antiretaliation or “whistleblower” provision (31 U.S.C. section 3730(h)), claiming that the School and two individual defendants—Board Chair Emmie Hershey and Head of School Arnstein—retaliated against him for attempting
to expose federal funding misuse. This provision protects employees, contractors, or agents from retaliation for lawful efforts to prevent fraud against the federal government.
The Court’s decision addressed three central questions: (1) whether the individual defendants could be held liable under the FCA, (2) whether Austin qualified as an “employee, contractor, or agent” of the School, and (3) whether there was evidence of unlawful retaliation.
Regarding the first question, the Court ruled that the FCA does not allow claims against individuals who are not the claimant’s employer. Hershey and Arnstein were sued in their personal capacities, but Austin, as a fellow board member, was not subordinate to them. The Court relied on precedent holding that the whistleblower provision imposes liability only on an employer—not individual supervisors or peers—thus dismissing all claims against Hershey and Arnstein.
Austin next argued that he qualified as an “agent” of the School and was therefore protected by the FCA. The Court applied traditional agency law, which requires both a principal’s manifestation of authority and the principal’s control over the agent’s actions. Although Austin participated on committees and helped with fundraising, the Court found no evidence that the School Board—or any individual—exercised control over his work. To the contrary, the Court emphasized that the School’s Bylaws granted collective authority to the Board and made clear that no trustee, including Austin, had individual power to bind the School. Austin was not supervised, evaluated, or directed in any employee-like manner. The Court concluded he was a fiduciary board member, not an agent under the FCA, and therefore not entitled to protection under the statute.
Even if Austin had qualified as a covered party, the Court found his retaliation claim failed on the merits. First, there was no evidence that the Board knew about his protected activity, and specifically, his contact with the U.S. Attorney’s Office, when it voted to remove him or to exclude his children. Austin admitted he had not
informed the full Board of his concerns and had raised the issue with only a few individuals, without mentioning litigation or whistleblower intent. The Court held that without such notice, there could be no causation.
Austin attempted to rely on the “cat’s paw” theory, which allows an employer to be held liable if a biased subordinate influences a neutral decision-maker to take adverse action. Austin argued that Hershey or other trustees who harbored animus toward him had manipulated the full Board into removing him as a trustee and denying re-enrollment to his children. But the Court found the Board acted independently after formal deliberation and majority vote, defeating any argument that a biased actor had manipulated the process.
Finally, the Court held that even if a prima facie case had been established, the School offered multiple legitimate, non-retaliatory reasons for Austin’s removal. These included concerns over his alleged breach of confidentiality, disruptive behavior, and inappropriate interactions with School staff. Austin failed to show these reasons were pretextual. His disagreement with the Board’s characterization of his conduct, the Court concluded, did not suffice to establish retaliation under federal law.
The Court granted summary judgment to all defendants and dismissed Austin’s claims in full.
Austin v. Charleston Day Sch. (D.S.C. June 25, 2025) 2025 U.S.Dist.LEXIS 120631.
Note:
This case underscores the importance of clearly defining the roles and authority of board members and adhering to a school’s bylaws. Schools should ensure their governance documents establish a structure that minimizes ambiguity and supports transparent, collective decision-making.
Court Allows Negligence And Fiduciary Duty Claims To Proceed Against Catholic School’s Parent Organizations.
Jane Doe began attending Mercy High School, an all-girls private school in Baltimore, as a freshman in 2016. At the time, she was a recently immigrated
14-year-old girl from Honduras. According to Doe’s complaint, the School hired assistant track coach Ernest Jackson based solely on a personal recommendation from an administrator and failed to comply with its own hiring policies or state law regarding background checks. Doe alleged that Jackson sexually abused her during her freshman and junior years. When the abuse was eventually reported, Mercy High School allegedly failed to follow its own child protection policy—modeled on the Archdiocese of Baltimore’s standards—and retaliated against Doe.
Doe brought suit against multiple entities, including the School, its Board of Trustees, its asset management arm, and two related organizations: the Sisters of Mercy of the Americas (SOM) and the Mercy Education System of the Americas (MESA). The suit asserted that SOM and MESA were not merely religious sponsors but contractual overseers of the School’s Board and policies and were therefore responsible for failing to protect her. The Complaint alleged that SOM and MESA exercised significant control over Mercy High School through a “Covenant” that granted them reserved governance powers, including approving school policy and ensuring that the School fulfilled its mission of providing a “Mercy Education”—a concept that explicitly includes nonviolence and the prevention of abuse.
Doe brought ten claims in total, including Title IX violations, negligence, and breach of fiduciary duty. Relevant here, SOM and MESA moved to dismiss Counts IX (negligence) and X (breach of fiduciary duty) for failure to state a claim. They argued that Doe lacked standing to sue them because she was not a party to the Covenant, and that they owed her no legal duty.
The Court denied the motion to dismiss, finding that Doe plausibly alleged both a duty of care and a fiduciary duty owed by SOM and MESA.
On the negligence claim, the Court reaffirmed its conclusion from another decision in the same case that a duty may arise from a contract even where the plaintiff is not a party, if the duty would not exist but for the contractual relationship. The Court found that Doe sufficiently alleged that SOM and MESA undertook contractual obligations via the Covenant that included oversight of Mercy High School’s Board of Trustees and implementation of policies to prevent abuse. The Court emphasized that in the school
context, Maryland courts have long held that institutions owe a duty to exercise reasonable care to protect students from harm. Doe alleged that SOM and MESA accepted and exercised authority over Mercy High School’s policies and agreed to provide a “Mercy Education,” and were therefore obligated to ensure that the School fulfilled its commitment to providing a safe environment.
The Court rejected SOM and MESA’s argument that Doe had to be a direct party to the Covenant in order to enforce a tort duty arising from it. Drawing on Maryland precedent, the Court noted that third parties may assert tort claims where duties flow from contracts intended, at least in part, for their benefit. Doe’s allegations that SOM and MESA undertook governance and oversight responsibilities with full awareness of their duty to prevent abuse of students, particularly given their public commitment to “nonviolence” as part of the Mercy Education, were sufficient at the pleading stage to survive dismissal.
As to the fiduciary duty claim, the Court held that Doe also plausibly alleged the existence of a fiduciary relationship between herself and SOM and MESA. A fiduciary duty arises where one party has a special obligation to act for the benefit of another. The Court emphasized that fiduciary relationships can be created by contract. Here, it found Doe’s allegations that MESA and SOM had authority over the School’s direction and policies, including those directly related to student safety, were sufficient to plausibly establish such a duty. It also found that whether a fiduciary duty existed was a fact question that could not be resolved on a motion to dismiss. The Court noted that it had previously permitted breach of fiduciary duty claims to proceed alongside negligence claims where the factual basis overlapped.
The Court denied the motion to dismiss, allowing both the negligence and breach of fiduciary duty claims to proceed to discovery.
Doe v. Mercy High School, Inc. (D. Md. July 3, 2025) 2025 U.S. Dist. LEXIS 126600.
Note:
LCW covered this case previously. This case highlights that when organizations exercise control over school governance, they may owe a duty of care or a fiduciary duty to students, potentially exposing them to liability even if they are not the direct school operator.
misconduct
Court Allows Race Discrimination Claims Against New York Private School To Proceed Following Student Expulsion.
J.D. attended Winston Preparatory School’s Chelsea campus beginning in 2017. The School is a private school in New York that primarily serves students with learning differences, such as dyslexia and executive function disorder, and the majority of students are white and from affluent families. According to the amended complaint, Dinean Davis, alleged that her son, J.D., an African American student with learning disabilities, was subjected to years of disparate disciplinary treatment and ultimately expelled on the basis of race.
In particular, Davis alleged that J.D. was frequently disciplined more harshly than white students for similar or less serious conduct. For example, he was chastised for talking during class or engaging in routine adolescent behavior, such as joking, speaking with peers, or roughhousing, while white students engaging in similar behavior received little to no discipline. He was also separated from sitting near a Black classmate during class for “distracting” one another, while white students who talked during class were not separated.
The complaint further alleged that the School’s headmaster, William DeHaven, regularly downplayed racial epithets used against Black students, justifying them as misunderstandings due to the students’ learning challenges. For example, when a student reported being called the N-word, DeHaven responded that “with their learning difficulties, they may not know what they are saying.” The complaint also described an incident in which DeHaven ordered the removal of a teacher’s “Black Lives Matter” sign while allowing signs expressing other social causes to remain.
In October 2019, J.D. was allegedly cyberbullied by two younger white girls who sent him sexually explicit messages and threats. After J.D.’s friend texted the girls in response, J.D. was disciplined, while the girls were
not. The School reportedly dismissed their conduct as “younger girls having a crush.”
In March 2020, J.D. was expelled. The expulsion followed a sexual encounter between J.D. (then 15), another underclassman (14), and an 18-year-old student, Jane Doe. According to the complaint, the encounter was consensual and initiated by Jane Doe, who encouraged that the encounter be recorded. Over the next several months, Jane Doe and J.D. allegedly sent text messages to arrange for another sexual encounter, but they would cancel or change their minds at the last minute. Weeks later, J.D. sent Jane Doe the video after she withdrew interest in continuing their relationship. Jane Doe took the message as a threat, which led her to report the incident, and ultimately resulted in J.D.’s immediate expulsion. Davis alleged that J.D. was not provided with a hearing, investigation, or opportunity to present his account; that DeHaven did not review the text messages to Jane Doe or the video of the encounter; and that DeHaven made the decision to expel J.D. within one day. Davis’ complaint alleged that Jane Doe, despite having engaged in sexual conduct with two underage students, received no discipline from the School.
Davis filed suit, asserting several claims including under 42 U.S.C. section 1981 (race discrimination), Title VI (race discrimination in federally funded programs), Title IX (sex discrimination), Section 504 of the Rehabilitation Act and the Americans with Disabilities Act (disability discrimination).
The Court first addressed Davis’s claim under 42 U.S.C. section 1981, which prohibits racial discrimination in contractual relationships, including those between private schools and students. To survive a motion to dismiss, the plaintiff is required to plausibly allege that J.D. was subjected to adverse treatment because of his race and that race was a “but-for” cause of the action taken against him.
The Court found that Davis had adequately pled such a claim. It noted that J.D. was expelled after sending a message that could be construed as coercive but
that other students, including Jane Doe, who engaged in criminal sexual conduct with minors, and the white girls who cyberbullied J.D., received no comparable punishment. The Court emphasized that these other students’ conduct was arguably as serious or more serious than J.D.’s and that a “reasonably close resemblance of facts and circumstances” existed to support a claim of disparate treatment.
The Court also highlighted DeHaven’s alleged pattern of minimizing racial slurs and selectively invoking learning disabilities to excuse white students’ behavior. These allegations, combined with the specific examples of unequal discipline and the expulsion decision, were sufficient to support a plausible inference of discriminatory intent. As a result, the Court denied the motion to dismiss Davis’s Section 1981 claim against the School and DeHaven.
The Court dismissed Davis’s Title VI, Title IX, and Rehabilitation Act claims after concluding that Winston Prep did not receive federal financial assistance at the time of J.D.’s expulsion. Davis had argued that the School’s 501(c) (3) tax-exempt status constituted federal financial assistance, making it subject to these statutes, but the Court rejected this argument, explaining that while tax exemption may provide indirect financial benefits, it does not involve the transfer of federal funds or services, nor does it subject the recipient to the same obligations as direct funding would. By making this finding, the Court aligned with the majority view among federal courts holding that tax-exempt status alone is insufficient to trigger coverage under civil rights statutes that require receipt of federal financial assistance. The Court also found that the School’s Paycheck Protection Program (PPP) loan—while arguably a qualifying source of federal funds—had been received after the events giving rise to Davis’ claims and thus could not establish jurisdiction under the statutes at issue.
Davis’ claims under the Americans with Disabilities Act and the Rehabilitation Act were also dismissed because Davis failed to plead that J.D. was denied a specific accommodation or was otherwise subjected to adverse action because of his disability.
Davis v. Winston Preparatory Sch. (S.D.N.Y. June 30, 2025) 2025 U.S. Dist. LEXIS 123630.
Note:
This case highlights the legal risks private schools may face under state and federal anti-discrimination laws when disciplining students, and it underscores the importance of consistent enforcement practices, well-documented decision-making, and clarity about whether the school receives any federal funding that could trigger compliance with additional state and federal laws.
September
2025 9:00 a.m. - 10:00 a.m.
Arbitration
Court Allows Students’ Race Discrimination Suit To Proceed Despite Private School’s Arbitration Provision.
Cristina Melendez and her daughters, Y.A. (age 16) and Y.S. (age 10), filed suit against Ethical Culture Fieldston School, a predominantly white private school in New York. Y.A. had attended the School from kindergarten through ninth grade. She voluntarily withdrew in April 2022 after being accused of cheating by her math teacher. Y.S., her younger sister, had been dismissed in Fall 2022 just days before the new school year began. The family, who identifies as people of color, alleged that both Y.A. and Y.S. were part of a broader pattern of racial discrimination. They brought claims under 42 U.S.C. section 1981 and related state and local laws.
Melendez had signed enrollment contracts on behalf of both children. These agreements contained arbitration provisions requiring that any disputes arising out of the family’s relationship with the School be resolved in arbitration. The School and several administrators moved to compel arbitration.
Applying the Federal Arbitration Act (FAA), the Court first determined that the enrollment contracts were covered by the statute due to their provisions regarding tuition, field trips, and internet services, all of which implicated interstate commerce. The central question, then, was whether the arbitration clauses could be enforced against the minor plaintiffs. The School argued that the minors were bound by the contracts their mother had signed. Plaintiffs countered that, under New York law, minors retain the right to disaffirm contracts they have not affirmed upon reaching adulthood. The Court agreed, citing long-standing precedent recognizing a minor’s personal right to void a contract, even one signed by a parent or guardian.
The Court also found that it, rather than an arbitrator, had the authority to decide whether the contracts had been properly disaffirmed. Because the challenge went to contract formation rather than performance, the Court concluded that it had to resolve the issue. It held
that Y.A. and Y.S. validly disaffirmed their contracts by filing the lawsuit and rejected the School’s argument that their prior enrollment waived that right, noting that neither child attended the School during the relevant academic year.
The Court distinguished between the minor plaintiffs and their parent. As an adult, Melendez could not disaffirm the contracts and remained bound by the arbitration provisions. The Court rejected her arguments that the arbitration agreements were unconscionable or impermissibly infringed her statutory rights. Her concerns about attorney fee limitations and excessive costs were deemed speculative and insufficient to void the agreements.
The Court further found that class action waivers included in the contracts were enforceable under New York law, even in standardized, “take-it-or-leave-it” service contracts like school enrollment agreements. It explained that the loss of a jury trial or access to class procedures are typical features of arbitration and do not, without more, make an agreement unconscionable, particularly where there is no showing of extreme imbalance or unfairness.
Finally, the Court rejected the argument that the School had waived its right to compel arbitration. Although some time had passed and the parties engaged in settlement discussions, there was no litigation on the merits before the motion to compel arbitration was filed.
The Court denied the motion to compel arbitration as to Y.A. and Y.S., allowing their claims to proceed in court. However, the Court granted the motion as to Melendez, who must pursue her individual claims in arbitration.
Melendez v. Ethical Culture Fieldston School (S.D.N.Y. June 27, 2025), 2025 U.S. Dist. LEXIS 122512.
Note:
This case highlights that while arbitration clauses in enrollment contracts are often enforceable against parents, courts may decline to apply them to minor students under state law.
Liability
Court Upholds $1 Million Verdict Against School District For Failing To Protect Student From Bullying.
E.I. was a student at El Segundo Middle School during the 2017–2018 school year. She was friends with two other students, Kate and Skyler. E.I told Kate that she liked a boy who Kate had recently dated. Kate told. E.I. “no worries.” When Skylar discovered E.I. was talking to Kate’s ex-boyfriend, she sent E.I. social media messages calling her a “b**ch,” “wh**e,” “slut,” “liar,” and “cheater.” She began insulting E.I. at school, sometimes screamed at her, flipped her off, and even slapped her. Teachers witnessed some of these incidents but did not intervene or report it.
E.I. reported the behavior to a school counselor, who arranged a group meeting with E.I., Skylar, and Kate on October 20, 2017. The counselor did not prepare for the meeting, did not share the school’s anti-bullying policies, and did not take follow-up steps. Afterward, Skylar’s behavior intensified. On October 24, E.I. emailed the counselor requesting another meeting “as soon as possible.” The counselor met with E.I. but did not investigate or take further steps.
The harassment escalated despite repeated complaints by E.I. and her parents to school officials. E.I. showed the counselor harassing message that Skylar had sent her, the counselor told her “girls will be girls” and “this is just girl drama.” E.I. began eating lunch alone in the nurse’s office and engaging in self-harm.
Throughout the remainder of the school year, Skylar continued bullying E.I. online and in person. In June, the students took a class trip to Knott’s Berry Farm, where Skylar and other students yelled at, taunted, and cursed at E.I. and made her cry. A teacher saw E.I. crying and did not say anything. The following day, students circulated a petition titled “Petition to END [E.I.]’s Life,” which included messages like “KKK” and “she is a whore.” Although the principal suspended the students involved, she did not notify E.I.’s parents and they learned of the petition from another family. The principal later admitted to having “dropped the ball.” Skylar was still
permitted to attend the school’s promotion ceremony the next day.
E.I. later transferred out of the District and was diagnosed with post-traumatic stress disorder, depression, and anxiety caused by the bullying. Her psychologist testified that her condition was enduring and would require years of therapy.
In April 2019, E.I. sued the El Segundo Unified School District, alleging negligence under Education Code section 44807 and Government Code sections 815.2, 815.6, 820, and 835. She claimed that District staff failed to protect her from peer bullying and did not follow established safety policies despite repeated complaints. Although she initially asserted a second cause of action for negligent hiring, supervision, and training, she dismissed that claim at trial and proceeded solely on a general negligence theory.
The District argued that its employees’ responses to bullying reports involved discretionary decisions protected by Government Code section 820.2. It argued that decisions about how to address student misconduct and whether to intervene or investigate involved professional judgment insulated from liability.
The jury found the District negligent and awarded E.I. $1 million in noneconomic damages, $700,000 for past and $300,000 for future harms. The trial court denied the District’s motions for a new trial and for judgment notwithstanding the verdict. The District appealed.
The Court of Appeal affirmed the trial court’s decision. It rejected the District’s argument that E.I. had relied on Education Code sections 48900 et seq., which deal with suspension and expulsion procedures, to create a duty of care. The Court of Appeal explained that E.I. did not base her claim on those statutes or argue they created a private right of action. Instead, her negligence claim rested on a duty recognized under common law and Education Code section 44807 to supervise students and protect them from foreseeable harm. The Court of Appeal reaffirmed that this duty includes protecting students from other students.
The Court of Appeal also held that the District was not entitled to immunity under Government Code section 820.2. That statute shields only basic policy decisions, not routine decisions made in implementing existing policy. The Court of Appeal found that staff did not make policy choices but simply failed to follow established safety procedures, such as investigating bullying reports, notifying parents, and offering support to students. Because these duties were already set out in the District’s and School’s safety plans, failing to carry them out did not qualify as protected discretion.
Finally, the Court of Appeal held that substantial evidence supported the jury’s verdict. E.I. testified that she repeatedly reported the bullying but the School ignored her. Her psychologist linked her PTSD and depression to the School’s failure to act. The Court of Appeal also found that the District waived its challenge to causation by failing to address key evidence in its opening brief. The Court of Appeal held that all other alleged errors were either harmless and forfeited. The Court of Appeal affirmed the trial court's judgment and upheld the $1 million damages award in favor of E.I.
E.I. v. El Segundo Unified School Dist. (June 13, 2025, No. B325733) ___Cal.App.5th___.
Note:
Although some of the statutes in this case do not apply to private schools, private schools still have a duty of care to protect students from harm. This case serves as an important reminder of the liability that schools may face for failing to uphold that duty.
curriculum
Supreme Court Grants Parents
Opt-Out Rights In Religious Objection To LGBTQ+ Curriculum.
On June 27, 2025, the United States Supreme Court issued its decision in Mahmoud v. Taylor, addressing whether public schools burden parents’ religious exercise when they require elementary students to participate in instruction related to gender and sexuality without notice or an option to opt out.
Background.
In October 2022, the Montgomery County Board of Education (Board) approved more than 22 LGBTQ+ inclusive storybooks for use in the English Language Arts curriculum across Montgomery County Public Schools (MCPS) in Maryland. The selected books addressed sexual orientation and gender identity and included titles such as Pride Puppy! for pre-K students and Born Ready: The True Story of a Boy Named Penelope for grades K-5. Initially, MCPS allowed parents to receive advance notice and to opt their children out of instruction involving these materials.
That changed in March 2023, when the Board eliminated the opt-out policy and discontinued providing notice, citing administrative challenges, high absenteeism, and concerns about stigmatization. Existing opt-outs were honored through the end of the 2022–23 school year.
A group of parents with diverse religious beliefs filed suit, alleging that requiring their young children to participate in this instruction violated their rights under the Free Exercise Clause of the First Amendment and the Due Process Clause of the Fourteenth Amendment. The parents sought a preliminary injunction requiring MCPS to restore the notice and opt-out options while the case proceeded.
Lower Court Rulings.
The U.S. District Court for the District of Maryland denied the motion for preliminary injunction, holding that the parents failed to show that the policy placed a cognizable burden on their religious exercise. The Fourth Circuit affirmed, reasoning that the parents had not demonstrated that exposure to different views amounted to pressure to abandon their beliefs.
Supreme Court’s Decision.
The Supreme Court reversed. The parents argued that, under Wisconsin v. Yoder, 406 U.S. 205 (1972), the Free Exercise Clause protects parents’ rights to direct their children's religious upbringing and that compelling participation in instruction contradicting their beliefs imposed a substantial burden. They also argued that the Board’s policy was not neutral or generally applicable under Church of Lukumi Babalu Aye v. City of Hialeah, 508 U.S. 520 (1993), and therefore should be subject to strict scrutiny.
MCPS contended that the parents had not shown coercion or compulsion and that, absent such a showing, the Court’s inquiry should end. It also argued that any further review should take place in the lower courts.
The Supreme Court held that the parents were entitled to a preliminary injunction. The Court found that the parents were likely to succeed on the merits, would suffer irreparable harm without relief, and that the balance of equities and public interest supported granting the injunction. Specifically, the Court held that the policy substantially interfered with the parents’ efforts to guide their children’s religious development, much like the law struck down in Yoder, where Amish families were required to send children to public high schools despite religious objections.
The Court rejected MCPS’s argument that the materials were simply about respect and inclusion. Instead, it found that the books promoted a specific viewpoint on same-sex marriage and gender identity and that teachers were directed to affirm that viewpoint and discipline students who disagreed. The Court emphasized that the key question is whether the instruction “substantially interferes” with the religious development of the child, not whether it merely introduces conflicting ideas.
Importantly, the Court concluded that even facially neutral and generally applicable policies are subject to strict scrutiny when they impose this kind of burden on religious exercise. To defend its policy, MCPS must now show that it serves a compelling interest and is narrowly tailored to achieve that interest. The Court noted that the continued availability of opt-outs in other parts of the curriculum, including health education, weakened the District’s argument that the policy was necessary to maintain a safe and inclusive learning environment.
In dissent, several Justices warned that the decision may place significant burdens on public schools by requiring them to provide advance notice and opt-outs for any material that could conflict with a student’s or family’s religious beliefs.
Note:
LCW’s full Special Bulletin on this case can be found here. This decision underscores the importance of carefully considering how curricular content intersects with families’ religious beliefs. While private schools are not bound by the First Amendment in the same way as public schools, schools should be aware that these types of challenges may become more common following the Supreme Court’s decision.
new to the Firm!
Jessica Lee is an Associate at Liebert Cassidy Whitmore, where she advises clients on labor and employment matters, including compliance, investigations, and workplace policies.
employee speech
Court Upholds Firing Of Public School Counselor Over AntiTransgender Speech.
Marissa Darlingh, a guidance counselor at AllenField Elementary School in the Milwaukee Public School District, delivered an impromptu speech at an April 2022 rally in Madison, Wisconsin. The rally was organized by a group of self-described “radical feminists” to protest gender ideology and its perceived effects on women and children. Speaking from the steps of the State Capitol, Darlingh identified herself as a Milwaukee Public Schools counselor and launched into a profanity-laced tirade against “gender ideology,” vowing that under her watch, “not a single” student would ever socially or medically transition. The speech included repeated expletives and denounced transgenderism as a concept and the individuals supporting it.
Her comments were recorded and circulated online. Within days, Milwaukee Public Schools opened an investigation. While the investigation was underway, Darlingh gave interviews to local and national media in which she stood by her comments. A Milwaukee Journal Sentinel article quoted her as saying she would not respect students’ chosen pronouns, though she later claimed this was inaccurate. The controversy reached her elementary school, where a fifth-grade teacher projected the article in class and told students they could decline counseling with Darlingh. When Darlingh entered the classroom and confronted the teacher, the incident was reported and added to the District’s concerns.
As part of the disciplinary process, Darlingh was given an opportunity to respond to the District. After receiving an initial notice of alleged policy violations,
she participated in a Zoom conference, where District officials presented a 126-page packet of materials, including video recordings, public complaints, and relevant policy documents. Darlingh’s attorney objected to the short notice with which to respond, and the District permitted Darlingh to submit written response. In her submission, Darlingh explained that her remarks were aimed at policy, not individuals, clarified that she would defer to parents on pronoun usage, and expressed a willingness to apologize and work collaboratively with affected staff or families. Despite these clarifications, the District ultimately determined that her conduct and statements irreparably undermined her ability to fulfill the duties of a school counselor and terminated her employment at the start of the next school year. The termination letter emphasized her use of vulgar language, her pledge to block student transitions, and the damage her statements had caused to the District’s mission and reputation.
Darlingh filed suit under 42 U.S.C. section 1983, alleging she was fired in retaliation for exercising her First Amendment rights. She also moved for a preliminary injunction seeking reinstatement. The trial court dismissed her First Amendment claim after applying the two-step balancing test established in Pickering v. Board of Education, 391 U.S. 563 (1968), and Connick v. Myers, 461 U.S. 138 (1983).
Under that framework, the court first asks whether the public employee spoke as a citizen on a matter of public concern. If so, it then balances the employee’s interest in the speech against the government’s interest in operating efficiently and maintaining trust in its services. The trial court found that although Darlingh had spoken as a citizen on a matter of public concern, her speech was so incompatible with her job responsibilities that the District was constitutionally justified in firing her.
On appeal, the Seventh Circuit Court of Appeals reviewed the legal issues and ultimately affirmed the trial court’s ruling. It accepted that Darlingh’s speech occurred in a traditional public forum and addressed a politically charged and timely issue. Her right to speak was therefore entitled to substantial weight under the First Amendment.
However, the Court of Appeals emphasized that context matters. It focused on Darlingh’s identification as a school counselor, the harsh and vulgar language of her speech, and the public nature of her pledge to actively resist gender transitioning among her students. The Court noted that school counselors occupy a position of significant trust, requiring empathy, discretion, and support for all students, including those exploring gender identity. Darlingh’s blanket, profanity-filled refusal to accommodate gender transitions signaled to parents and students that she could not be trusted to treat transgender youth with respect and impartiality.
The Court also acknowledged that some of her post-speech clarifications softened the rhetoric and indicated assurances that Darlingh would comply with District policy. However, it found that the District had reasonably concluded that her explanation did not restore confidence in her ability to perform her role. The Court characterized her conduct as “a harsh, angry, and profanity-filled public pledge” to apply a personal ideology at work in a way that directly conflicted with her professional duties and the School’s mission.
Ultimately, the Court held that the District’s interest in preserving student trust and ensuring access to equitable counseling services outweighed Darlingh’s First Amendment interest in her speech. Because her words reasonably cast doubt on her fitness to serve as a counselor, the District’s termination decision did not violate the Constitution.
The Court affirmed the denial of the preliminary injunction and the dismissal of the First Amendment claim.
Darlingh v. Milwaukee Public Schools 2025 (7th Cir. 2025) U.S. App. LEXIS 16215.
Note:
Unlike public school teachers, private school teachers do not have constitutional free speech rights at school. However, off-campus speech, especially on controversial topics, can still trigger community concern and reputational risk. Schools should proactively clarify expectations around professional conduct outside the classroom and ensure employment agreements and handbooks provide flexibility that allows schools to address speech that may undermine the school’s values or mission.
feha
California Court Dismisses Discrimination Claims Against Religious Employer Based On FEHA Exemption.
Alan Carter Sr. worked for The Salvation Army from February to April 2024. Carter filed an 11-count complaint against The Salvation Army and several of its affiliated entities, including the Adult Rehabilitation Center (ARC) in Canoga Park, and two individual employees: Brenton Doe, his shift manager, and Dora Rojero, the HR generalist who processed his termination. During his brief tenure, Carter claimed that Doe repeatedly made inappropriate and harassing comments to him based on his race and perceived gender or sexual orientation.
According to Carter, he reported the harassment to the District Manager and then to Human Resources. Instead of investigating, he alleged that Rojero terminated him on April 8, 2024, in retaliation for his complaints. His complaint included claims under FEHA for discrimination, hostile work environment harassment, retaliation, and failure to prevent discrimination and harassment. He also brought claims for sexual harassment, wrongful termination in violation of public policy, whistleblower retaliation, breach of contract, negligent hiring, and intentional infliction of emotional distress.
The Salvation Army and Rojero objected to several of Carter’s causes of action, arguing that as a religious nonprofit, the organization was exempt from liability under FEHA and that the other claims were either
insufficiently pled or not applicable in an employer-employee context. In particular, they argued that under Government Code section 12926(d), religious nonprofit employers are explicitly exempt from FEHA’s definition of “employer.” The Salvation Army also requested judicial notice of its Articles of Incorporation to confirm its religious nonprofit status, which the Court granted.
Carter attempted to circumvent FEHA’s statutory exemption by arguing that his position fell into a healthcarerelated exception under Government Code section 12926.2, which provides limited carve-outs for employees in healthcare roles. The Court rejected this argument, explaining that the exception applies only to specified healthcare-related contexts and does not suggest that non-healthcare-related employees may bring FEHA claims against religious organizations by implication.
The Court held that The Salvation Army was a religious nonprofit, properly excluded from FEHA's reach. The Court relied on both the statutory definition and case law interpreting it, including decisions barring FEHA claims against religious schools and churches under similar facts. It concluded that because Carter had not alleged facts taking his role outside the general employer-employee context, his FEHA-based claims were barred as a matter of law and could not be amended to survive dismissal.
Regarding Carter’s sexual harassment claim, Carter invoked both FEHA and California Civil Code section 51.9. The Court dismissed the FEHA-based aspect for the reasons already stated. It then examined whether section 51.9 could independently support the claim. Section 51.9 applies where a plaintiff and defendant have a “business, service, or professional relationship” akin to those of landlord-tenant, teacher-student, or attorney-client. Critically, Courts have held that the statute does not apply to employer-employee relationships. Because Carter alleged only an employment relationship with The Salvation Army and its staff, the Court found that his claim fell outside the scope of section 51.9 and dismissed it with leave to amend.
Carter’s final cause of action at issue was a common-law wrongful termination in violation of public policy. Carter cited general references to the California Constitution, FEHA, and the Labor Code. The Court noted that a viable wrongful termination claim requires the plaintiff to articulate a “delineated” public policy grounded in constitutional or statutory authority, that is “public” in nature, and that was clearly established at the time of discharge. Because Carter’s complaint was vague and did not identify a specific, actionable public policy violated by his termination, the Court dismissed this claim with leave to amend.
Carter v. The Salvation Army (Cal. Super. Ct. June 5, 2025) 2025 Cal. Super. LEXIS 26873.
Note: This case serves as an important reminder that FEHA has an exemption for nonprofit employers incorporated as religious corporations.
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business&facilities
Court Of Appeal Defines Boundaries For Collecting TimeBarred Private Student Loans.
In Guracar v. Student Loan Solutions LLC, a California Court of Appeal found that claims against private education lenders or servicers brought under state and federal debt collection statutes do not need to show violations resulted in actual, concrete harm in order to recover damages in state court.
In 2007, Osman Yunus Guracar took out a $7,000 private student loan from Bank of America (Bank). The loan required monthly payments and included an acceleration clause allowing the lender to demand full repayment after default. Mr. Guracar defaulted in 2009. In January 2010, the Bank charged off the entire $8,288.53 debt as uncollectable and removed it from their accounting books. A month later, the Bank sent Mr. Guracar a letter demanding immediate payment despite the charge-off.
In 2017, Student Loan Solutions (SLS) purchased the loan from the Bank. From November 2017 to June 2022, SLS’s collection agent, Williams & Fudge (W&F), issued Mr. Guracar two demand letters for payment of the debt. Notably, the letters varied in tone, amount demanded, disclosure of the debt’s nature, and enforcement language.
In September 2022, SLS filed a lawsuit against Mr. Guracar for $3,963.06 for missed payments over the prior four years, claiming it had accelerated the loan in its 2022 notice, thereby making the entire principal and interest due upon Mr. Guracar’s failure to make payment. Mr. Guracar cross-complained against SLS, W&F, and their counsel (cross-defendants), for violation of the Debt Buyer’s Act (DBA), Penal Statutes of Limitations Consumer Remedies Act (PSLCRA), Rosenthal Act
(Rosenthal Act), and the federal Fair Debt Collection Practices Act (FDCPA). The trial court dismissed Mr. Guracar’s claims, affirming that the 2022 letter represented cross-defendants exercise of the acceleration clause and the claim to be within the four-year statute of limitations. Mr. Guracar appealed.
The DBA, PSLCRA, Rosenthal Act, and FDCPA contain explicit compliance requirements for loan collectors and servicers, prohibiting collectors from taking action to collect time-barred debts. The DBA and PSLCRA specifically require collectors to possess certain information and documents before contacting a debtor. The Rosenthal Act, which incorporates portions of the FDCPA, prohibits false or misleading representation in collection efforts.
On appeal, cross-defendants argued that Mr. Guracar lacked standing because he had not shown any actual or concrete injury, as required under federal law.
The Court of Appeal considered two issues: (1) whether Mr. Guracar had standing in state court without showing concrete harm, and (2) whether the collection efforts violated the debt collection statutes.
The Court of Appeal reversed in part. First, the Court concluded California’s debt collection statutes do not require plaintiffs seeking statutory damages to prove concrete injury. Statutory penalties are available without actual harm under these consumer protection laws.
Next, the Court cited the acceleration clause doctrine. It emphasized that earlier demand letters in 2010 and 2017 may have triggered acceleration of the loan. If they demanded acceleration of the loan then, the limitations period began then, not in 2022.
The Court found the 2022 letters may have violated the statutes by failing to disclose the debt’s time-barred status and using language suggesting enforceability. Even without an explicit threat to sue, the language could mislead the debtor. The Court therefore permitted Mr. Guracar to continue his cross-claims against SLS and others.
The Guracar holding could increase liability risks for institutions that collect on student loans. Phrases in payment demand letters, such as “we accelerate the loan” and “the balance is now immediately due,” carry legal weight and may create a false impression of enforceability if the statute of limitations has expired. Servicers must align their collection language with the loan’s actual legal status and disclose time-barred conditions clearly.
The Court made clear that technical missteps, deceptive conduct, or missing disclosures will not be excused. Private institutions that manage or service private student loans must proactively review all communications. Even without a direct threat to sue, inconsistent or unclear messages can lead to legal exposure. Institutions should track loan status, monitor applicable time limits, and ensure all borrower communications comply with state and federal law.
Trainer Program
Guracar v. Student Loan Solutions LLC (Case No. H051407)
lcw best timeline
MID-JUNE THROUGH END OF JULY
Update Employee and Student/Parent Handbooks:
• The handbooks should be reviewed at the end of the school year to confirm that the policies are legally compliant, consistent with the employment agreements and enrollment agreements that were executed, and current with the latest best practice recommendations. The school should also add any new policies that it would like to implement upon reflection from the prior school year and to prepare for the upcoming school year.
Conduct review of the school’s Bylaws (does not necessarily need to be done every year).
Review of insurance benefit plans:
• Review the school’s insurance plans, in order to determine whether to change insurance carriers. Insurance plans expire throughout the year depending on your plan. We recommend starting the review process at least three months prior to the expiration of your insurance plan.
• Workers Compensation Insurance plans generally expire on July 1.
• Other insurance policies generally expire between July 1 and December 1.
AUGUST
Conduct staff trainings, which may include:
• Sexual Harassment Training:
A school with five or more employees, including temporary or seasonal employees, must provide sexual harassment training to both supervisory and nonsupervisory employees every two years. Supervisory employees must receive at least two hours and nonsupervisory employees must receive at least one hour of sexual harassment training. (California Government Code section 12950.1)
• Mandated Reporter Training:
Prior to commencing employment, all mandated reporters must sign a statement to the effect that they have knowledge of the provisions of the Mandated Reporter Law and will comply with those provisions. (California Penal Code section 11166.5)
• Maintaining Professional Boundaries
• Risk Management Training such as Injury and Illness Prevention and CPR
Conduct Board / Governance Training, which may include:
Each Month, LCW presents a monthly timeline of best practices for private and independent schools. The timeline runs from the fall semester through the end of summer break. LCW encourages schools to use the timeline as a guideline throughout the school year.
• Fiduciary Duties
• Legal Compliance & Risk Management
• Governance Best Practices
Distribute Parent/Student Handbooks and collect signed acknowledgement of receipt forms, signed photo release forms, signed student technology use policy forms, and updated emergency contact forms.
Plan Ahead for Back-to-School Trainings
Start the school year strong with LCW’s dynamic and practical professional development sessions, customized for the unique and evolving needs of California private schools.
Essential training topics include:
• Harassment & Discrimination Prevention (Supervisory and NonSupervisory)
• Maintaining Professional Boundaries
• California Mandated Reporter Training
• The Art of the Performance Evaluation
• Leading from the Middle
• Board Governance 101
• And many more!
Available Live or On-Demand. Schedule Now at info@lcwlegal.com
cases we are watching
• The U.S. Supreme Court has agreed to hear cases challenging West Virginia and Idaho laws that ban transgender athletes from competing on sports teams consistent with their gender identity, raising constitutional questions under the 14th Amendment’s Equal Protection Clause and Title IX. The decision to grant review follows the Supreme Court’s recent ruling in United States v. Skrmetti, which upheld a Tennessee law restricting gender-affirming care for minors. Lower courts in both the Fourth and Ninth Circuits previously found the West Virginia and Idaho bans unlawful, citing that the laws discriminate based on sex and deny transgender students equal athletic opportunities.
• California education officials and athletic leaders refused to sign a pledge demanded by the U.S. Department of Education that would ban transgender athletes from competing according to their gender identity, defying pressure from the Trump administration. The Department of Education’s Office for Civil Rights accused the California Department of Education (CDE) and California Interscholastic Federation (CIF) of discriminating against female athletes and warned of legal consequences if they did not comply within 10 days. Both the CDE and CIF rejected the Department’s legal interpretation, citing their commitment to California law, which has allowed transgender studentathletes to compete in line with their gender identity since 2013. Following their refusal, the U.S. Department of Justice filed a civil lawsuit against the CDE and CIF, alleging that their policies “force girls to compete against boys” and violate federal civil rights laws by denying girls equal athletic opportunities and creating a hostile educational environment.
• Barnard College has reached a settlement with student plaintiffs in a federal lawsuit alleging antisemitism, agreeing to implement new measures to ensure equal treatment and protection of Jewish and Israeli students. As part of the settlement agreement, Barnard will appoint a Title VI Coordinator (similar to a Title IX Coordinator), enhance training on its discrimination policy, and require all students, faculty, and staff to complete annual education on identifying and responding to antisemitism. Barnard also committed to issuing annual messages reinforcing its zerotolerance stance on discrimination and clarified that student conduct off campus, including on Columbia’s campus or online, may be subject to discipline. Barnard emphasized that its endowment will not be used to advance political causes and reaffirmed it will not negotiate with divestment-focused student groups. More information about the settlement terms can be found here.
did you know...?
• California’s Civil Rights Department announced final approval of new employment regulations governing the use of artificial intelligence and automated decision-making tools, with the goal of protecting workers from potential discrimination. Set to take effect October 1, the rules clarify how California’s Fair Employment and Housing Act (FEHA) applies to AI-based hiring, recruitment, and promotion decisions, and emphasize that employers must ensure such tools do not result in bias. The regulations aim to:
• Make it clear that the use of an automated-decision system may violate California law if it harms applicants or employees based on protected characteristics, such as gender, race, or disability.
• Ensure employers and covered entities maintain employment records, including automated-decision data, for a minimum of four years.
• Affirm that automated-decision system assessments, including tests, questions, or puzzle games that elicit information about a disability, may constitute an unlawful medical inquiry.
• Add definitions for key terms used in the regulations, such as “automated-decision system,” “agent,” and “proxy.”
• The U.S. Department of Justice announced it is investigating whether the University of California’s 2030 Capacity Plan led to unlawful race- or sex-based discrimination in hiring and employment practices across its campuses in violation of Title VII. The 2030 Capacity Plan, announced in July 2022, outlined the University of California's plans to increase enrollment by 23,000 students before the end of the decade by boosting the share of in-state students, helping students graduate more quickly and encouraging what are known as “stopped-out students” to complete their degrees, among other initiatives. Part of the strategic plan also aims to increase diversity among students and faculty to reflect California's demographics. The investigation will cover the entire UC system, including its 10 campuses and affiliated institutions.
• The IRS has published a new version of the Exempt Organizations Technical Guide on Disqualifying and NonExempt Activities, Inurement and Private Benefit. The Technical Guide addresses the concepts of inurement and private benefit pertaining to Section 501(c)(3) organizations, such as private schools. Organizations exempt under Section 501(c)(3) must avoid engaging in impermissible conduct, including that which results in private benefit and inurement. An otherwise qualifying organization will be disqualified of its 501(c)(3) status if it uses its income or assets to improperly benefit an individual with significant control or influence over the organization. The guide can be found here.
Consortium Call Of The Month
LCW has four private education consortiums across the State! Consortium members enjoy access to quality training throughout the year, discounts on other LCW products and events, and unlimited, complimentary telephone and email consultation with an LCW private education attorney on matters related to employment and education law questions (including business & facilities questions and student issues!) We’ve outlined a recent consortium call and the provided answer below. Client confidentiality is paramount to us; we change and omit details in the Consortium Call of the Month.
Question:
Question: A private school administrator at an elementary school asked whether high school students, all of whom are under 18 and volunteering at the elementary school’s summer program, needed to be LiveScanned.
Answer:
The LCW attorney advised that Assembly Bill 506 or AB 506 requires youth service organizations to conduct LiveScan criminal background checks for volunteers who will have substantial contact with minors. The attorney explained that, although not entirely clear, LCW does not believe that private schools are considered youth service organizations. That said, the attorney advised that it is a best practice to require criminal background checks for all volunteers who will be alone with minors, and, some insurance carriers require that volunteers undergo criminal background checks. Therefore, the attorney advised that the School should LiveScan the high school students. Because the LiveScan may reveal sensitive information about the high school students, the attorney also recommended that the School obtain consent from the student’s parent/guardian for the LiveScan to be conducted.w
Liebert Cassidy Whitmore