New Concept Massage & Beauty School, Inc. v. National Accrediting Commission of Career Arts and Sciences, Inc.

Summary

The United States District Court for the Eastern District of Virginia addresses New Concept Massage & Beauty School, Inc.’s motion for a preliminary injunction against the withdrawal of its accreditation by NACCAS. The court finds that Plaintiff is likely to succeed on its due process claim because NACCAS continued sending notices to the deceased owner’s address and provided no effective avenue for stakeholders to respond during probate proceedings. The court grants the motion in part, requiring restoration of Plaintiff’s accreditation during the pending appeal in accordance with NACCAS’s rules, applicable regulations, and federal law.

Holdings

1. New Concept demonstrated a likelihood of success on its claim that NACCAS denied due process by proceeding with accreditation revocation without providing effective notice, an opportunity to be heard, or a meaningful opportunity to appeal while knowing that the school's owner was deceased and ownership was subject to probate proceedings.
2. The preliminary-injunction factors supported limited relief temporarily restoring New Concept's accreditation during the pendency of its appeal.
3. NACCAS was required to restore New Concept's accreditation temporarily during the pendency of its appeal, in accordance with the applicable statute, regulations, and NACCAS's rules, until a final decision on appeal, arbitration, or the merits of the federal action.
4. The previously posted $5,000 bond would remain posted as security for the preliminary injunction.

Questions Presented

1. Whether New Concept was likely to succeed on its due-process challenge to NACCAS's withdrawal of accreditation when NACCAS knew the school's owner had died and an ownership dispute was pending but continued sending notices to the deceased owner's address.
2. Whether the four preliminary-injunction factors supported temporarily restoring New Concept's accreditation during its appeal.
3. Whether NACCAS was required under applicable statute, regulations, and its own rules to maintain the school's accreditation during the pendency of the appeal.
4. Whether the previously posted $5,000 security bond should remain in place under Federal Rule of Civil Procedure 65(c).

Disposition

other