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May 22, 2019, 9:47 am CDT
Western State College of Law, which is part of the embattled Argosy University System, has submitted a proposed teach-out plan with the ABA after losing its federal student loan money, being placed in receivership and conducting a search for an acquisition partner.
Details of what is in the Callifornia school’s proposal were not disclosed on the Section of Legal Education and Admissions to the Bar website, where the notice is posted. Barry Currier, the ABA’s managing director of accreditation and litigation, said that other than the notice, everything else about the proposal is not public. Allen Easley, the law school’s dean, did not respond to ABA Journal interview requests.
Dream Center Education Holdings, a Christian nonprofit, bought Argosy from the Education Management Corp in 2017, and since then it has struggled to convert the for-profit college to a nonprofit, the New York Times reported.
The U.S. Department of Education in February pulled the schools’ federal financial aid, based on allegations that its parent company had used millions in federal financial aid stipends to cover payroll and other expenses. The U.S. District Court for the Northern District of Ohio in January appointed Cleveland lawyer Mark E. Dottore as Dream Center Education Holdings’ receiver, and in March he sent a statement to the ABA Journal that a potential buyer had been identified for the law school.
In an April 26 order, a U.S. magistrate ordered that the receivership be terminated by May 31. However, there may still be hope that the law school does not close for good. A subsequent order, dated May 20, stated that Dottore had informed the court that he could not fulfill his duties before May 31, and that keeping that date would “prevent the sale of the law school and the completion of teach-out periods for three other universities.” The May 20 order directs Dottore to submit a proposed order by May 30, with a plan to streamline the receivership and complete the remaining tasks he listed, “all within as short a time period as possible.”
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