Fourth Circuit revives Virginia schools’ challenge to federal funding freeze over bathroom policies

The appellate court allowed the Virginia school districts to argue its transgender bathroom policies comply with Title IX in federal court rather than the Court of Federal Claims.RICHMOND, Va. (CN) — A Fourth Circuit panel cleared the way on Thursday for a pair of Virginia school districts to continue suing the U.S. Department of Education, after the department cut funds over the schools’ inclusive bathroom policies.Fairfax County Public School District and the Arlington Public School District say the department designated them at high risk of violating Title IX because they allow students to use restrooms and locker rooms that align with their gender identity.The designation means the federal government only distributes funds through reimbursement, contingent on the divisions ditching their restroom policies.The three-judge Fourth Circuit panel determined that a lower court shouldn’t have dismissed the case over jurisdictional issues.​U.S. District Court Judge Rossie Alston, a Donald Trump appointee, had found the Court of Federal Claims has sole jurisdiction over suits based on contracts with the federal government, but the panel’s majority disagreed with Alston that the complaints were purely contractual.​"The school districts do not assert that any grant or contract terms entitle them to retain their policies, avoid an enforcement action, or not be labeled high-risk," U.S. Circuit Court Judge Allison Rushing wrote. “Nor do the school districts identify or seek to enforce any contract term that allegedly requires advance payment of federal financial assistance rather than reimbursement.”Rushing, also a Trump appointee, reasoned that the complaint isn’t subject to the Tucker Act because the relief sought isn’t entirely contractual. She noted that the school districts also seek a court declaration that their policies do not violate Title IX, to set aside their high-risk designation and to block any future enforcement actions on Title IX grounds.​"At its essence, the school districts’ claim is not that any grant or contract entitles them to advance payment but rather that the department cannot place them on reimbursement status as a penalty for violating Title IX when, in their view, they are not violating the statute," Rushing wrote. ​Chief U.S. Circuit Judge Albert Diaz, a Barack Obama appointee, concurred with Rushing.The Education Department had pointed to the districts’ other request for a court order requiring immediate payment of any denied funds as evidence of the complaints’ contractual nature.Fellow Trump appointee U.S. Circuit Judge Julius Richardson agreed with the department in a dissent.​"The districts sued to restore advance payments," Richardson wrote. “That demand for prepayment under their grant contracts is the gravamen of their claims.”​"Arlington Public Schools is pleased with the court’s decision and looks forward to the next steps in the legal process," Christina Arpante, Interim Assistant Superintendent for School and Community Relations at Arlington Public Schools, said in an email. “Our focus remains on providing a safe, welcoming and supportive learning environment where all students feel valued, respected and supported in their learning.”The Justice Department did not respond to a request for comment.​"School districts should be able to focus on creating safe, inclusive and welcoming educational opportunities for all students without fear of losing the resources that allow them to do that," Narissa Rahaman, executive director of Equality Virginia, which filed a brief supporting the divisions, said in a statement.​Subscribe to our free newslettersOur weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts.Additional Reads