In Re the New Maurice J. Moyer Academy, Inc.

IN THE COURT OF CHANCERY IN THE STATE OF DELAWARE
IN RE THE NEW MAURICE J. MOYER CONSOLIDATED
ACADEMY, INC. C.A. No. 10398-CB
OPINION
Date Submitted: January 2, 2015
Date Decided: January 9, 2015
Kurt M. Heyman, Melissa N. Donimirski and Dawn Kurtz Crompton of PROCTOR
HEYMAN LLP, Wilmington, Delaware; Michael P. Migliore and Christofer C. Johnson
of CITY OF WILMINGTON LAW DEPARTMENT, Wilmington, Delaware; Attorneys
for Plaintiffs Shauniece Anderson, for her minor child S.A.; Shatana Turner, for her
minor child D.T.; Alvin Alexander, for his minor children Z.A. and O.A.; and The City of
Wilmington.
William E. Manning, James D. Taylor, Jr. and Allison J. McCowan of SAUL EWING
LLP, Wilmington, Delaware; Attorneys for Plaintiffs The New Maurice J. Moyer
Academy, Inc.; Judi Kennedy, for her minor child K.D., Jemuel Anderson, for his minor
child J.K.A.J.; Jacqueline Bailey, for her minor child J.L.; Shalonda Davis, for her minor
child O.D.; and Darcel Earl, for her minor child C.G.
Joseph C. Handlon, Scott W. Perkins, Catherine T. Hickey, Ilona Kirshon and Roopa
Sabesan of DEPARTMENT OF JUSTICE STATE OF DELAWARE, Wilmington,
Delaware; Max B. Walton and N. Christopher Griffiths of CONNOLLY GALLAGHER
LLP, Newark, Delaware; Ryan P. Newell of CONNOLLY GALLAGHER LLP,
Wilmington, Delaware; Attorneys for Defendants.
BOUCHARD, C.
I. INTRODUCTION
In 1995, the General Assembly adopted the Delaware Charter School Act. 1 The
purpose of the Act was “to create an alternative to traditional public schools operated by
school districts and improve public education overall by establishing a system of
independent ‘charter’ schools throughout the State.” 2 To that end, the Act “offers
members of the community a charter to organize and run independent public schools, free
of most state and school district rules and regulations governing public education,” and
with the use of public funds, “as long as they meet the requirements of [the Act], and
particularly the obligation to meet measurable standards of student performance.” 3
Today, over 30 charter schools operate in the State of Delaware. This action
concerns one of them. Maurice J. Moyer Academic Institute (“New Moyer”) is a charter
school located in Wilmington, Delaware serving grades 6-12. In 2011, it was granted a
four-year charter that started with the 2012-2013 school year, and expires at the end of
the 2015-2016 school year.
In this action, the operator of New Moyer, parents representing several of its
students, and the City of Wilmington seek a preliminary injunction to enjoin the
Delaware Department of Education, the Secretary of Education for the State of Delaware,
and the Delaware State Board of Education from implementing their October 2014
1
14 Del. C. ch. 5.
2
14 Del. C. § 501.
3
Id.
1
decision to revoke New Moyer’s charter and to close the school at the end of the current
school year, in June 2015, one year before the charter expires. As discussed below,
following an extensive process set forth in the Charter School Act, this decision was
made because, among other reasons, New Moyer is the lowest performing charter school
in the State based on the State’s testing standards.
New Moyer serves some of the most economically disadvantaged students in the
State of Delaware. They face significant academic challenges. It is natural to be
sympathetic to Plaintiffs’ desire to keep New Moyer’s doors open for an additional
school year so that the families who chose New Moyer can continue to send their
children to what they view as their only practical option to attend a school in their
neighborhood. It is the responsibility of State officials, however, to make the tough
decisions concerning whether a charter school is meeting its obligations under the Charter
School Act.
The primary issue before the Court is whether Plaintiffs have demonstrated a
reasonable probability that they have been denied due process under the Fourteenth
Amendment of the United States Constitution with respect to the decision to revoke New
Moyer’s charter. For the reasons discussed below, I conclude they have not. More
specifically, I conclude that New Moyer does not have a constitutionally protected
property interest in its charter and that its students do not have a constitutionally
protected interest in graduating from New Moyer and that, even if they did, Plaintiffs
have failed to demonstrate that it is reasonably probable they were not afforded due
process.
2
I also conclude that, although the Charter School Act expressly prohibits judicial
review of the merits of a decision to revoke a school’s charter, it impliedly affords the
school the right to challenge whether one of the statutorily required grounds upon which
a charter may be revoked was made after the exercise of due diligence and good faith.
The evidence Plaintiffs have presented, however, is insufficient to demonstrate that it is
reasonably probable this standard was not met here.
For these and the other reasons explained below, Plaintiffs’ motion for a
preliminary injunction is denied.
II. BACKGROUND 4
A. The Parties
Plaintiff The New Maurice J. Moyer Academy, Inc., a non-stock, non-profit
Delaware corporation, operates Maurice J. Moyer Academic Institute, a charter school
serving grades 6-12 in the City of Wilmington, Delaware. Although these two entities
are technically distinct, I refer to them interchangeably as “New Moyer.”
4
These are the preliminary facts as I find them based on the documentary evidence and
affidavits from the following individuals submitted by the parties in conjunction with
Plaintiffs’ preliminary injunction motion: (i) Rev. Christopher T. Curry, Ph.D, Chairman
of the Board of Directors of New Moyer (“Curry Aff.”); (ii) John H. Carwell, Jr., an
Education Associate at the Department (“Carwell Aff.”); (iii) Donna R. Johnson, the
Executive Director of the State Board and a non-voting member of the Committee
(“Johnson Aff.”); (iv) Barbara Mazza, an Education Associate at the Department and a
voting member of the Committee (“Mazza Aff.”); (v) Mary Kate McLaughlin, the Chief
of Staff for the Department (“McLaughlin Aff.”); (vi) Jennifer Nagourney, the Executive
Director of the Department’s Charter School Office (“Nagourney Aff.”); and (vii) Shelley
Rouser, the Director of K-12 Initiatives and Educator Engagement for the Department
(“Rouser Aff.”) No depositions were taken in connection with Plaintiffs’ preliminary
injunction motion.
3
Plaintiffs Shauniece Anderson, Shatana Turner, Alvin Alexander, Judi Kennedy,
Jemuel Anderson, Jacqueline Bailey, Shalonda Davis, and Darcel Earl are Delaware
citizens who filed suit on behalf of their minor children who currently attend New Moyer.
I refer to these citizens and their minor children together as the “Individual Plaintiffs.”
Plaintiff The City of Wilmington, a Delaware municipal corporation, filed suit as
parens patriae for the benefit of minor citizens who attend or wish to attend New Moyer.
Defendant Delaware Department of Education (the “Department”) is the State
agency that oversees public education in Delaware.
Defendant Mark T. Murphy is, and was as of the date of the revocation decision,
the Secretary of Education for the State of Delaware (the “Secretary”). Murphy is sued
solely in his official capacity as the Secretary.
Defendant Delaware State Board of Education (the “State Board”), an entity
within the Department, is the governing body of the Delaware school system. The State
Board administers and supervises the charter schools of Delaware.
Defendants Teri Quinn Gray, Jorge L. Melendez, Gregory G. Coverdale, Jr., G.
Patrick Heffernan, Randall L. Hughes, II, Barbara B. Rutt, and Jerry M. Whittaker are,
and were as of the date of the revocation decision, the seven members of the State Board.
They are sued solely in their official capacities as members of the State Board.
B. The Predecessors to New Moyer
In 2006, the Department granted a charter for a school named The Maurice J.
Moyer Academy, Inc. (“Old Moyer”), which would be located in the City of Wilmington.
4
In February 2010, the Secretary of the Department recommended, and the State Board
agreed, not to renew Old Moyer’s charter. 5
In 2010, the General Assembly directed the Department to manage a school at the
location of Old Moyer from July 1, 2010, until June 30, 2012. 6 Pursuant to the General
Assembly’s directive, in July 2010, the Department contracted with K-12 Classroom DE,
LLC (“K12”) to provide educational services for the 2010-2011 academic year. 7 In July
2011, after issuing a request for proposals for a third party to provide educational services
for the 2011-2012 academic year, 8 the Department awarded that contract to K12. 9
C. New Moyer is Formed and Receives a Charter from the Department
On January 3, 2011, a group of individuals (the “Moyer Board”) submitted an
application to the Department to operate a charter school at the former location of Old
Moyer. 10 The application, which reflected the “consensus” of the Moyer Board members
on the new school’s “mission, goals and organization,” was signed by all members of the
Moyer Board, including the current Chairman, Christopher Curry (“Curry”), and the
5
Defs.’ Ex. 1 at DOE-MOYER001418-21.
6
77 Del. Law Ch. 327; 145th General Assembly, SB 310 § 384.
7
Defs.’ Ex. 2.
8
Defs.’ Ex. 3.
9
Defs.’ Ex. 4; Carwell Aff. ¶ 12.
10
Pls.’ Ex. 9.
5
current Vice Chairman. 11 The application set forth forty-seven separate “assurances” of
the Moyer Board should it receive a charter. Those assurances included, for example,
that the school would “[b]e in full compliance with 14 Delaware Code, Chapter 5” (the
Charter School Act); that the Moyer Board would “not implement any modifications to
the charter school program or operation without the express written consent of the
Department”; and that the Moyer Board and the school would “[c]omply with the
provisions for a Performance Agreement, as required by the Secretary.” 12
The Moyer Board contemplated that the new school, New Moyer, would serve 365
students in grades 6-12 in its first year and would expand to serve 600 students in grades
6-12 in its fourth year. 13 Anticipating that New Moyer’s demographics would be similar
to those of its predecessors, the Moyer Board projected that the student body would be
predominantly economically disadvantaged (with over 90% qualifying for free or reduced
lunch) and minority (with over 99% being African American), and that approximately
25% of its students would need special education services. 14
According to its application, the Moyer Board “intend[ed] to contract with [K12]
for educational and management services in the operation of the school if the Moyer
11
Id. at CW000416, 495, 498. Although the composition of the Moyer Board has
changed since New Moyer received its charter, the identity of its members is immaterial
to this opinion.
12
Id. at CW000491-94.
13
Id. at CW000414.
14
Id. at CW000415.
6
Board [were] granted a charter.” 15 The Moyer Board further stated that it found K12,
which offered an online instruction method, to be “the premier provider of curriculum,
systems, and services” in digital education. 16 The application also included a draft
services agreement between New Moyer and K12 pursuant to which K12 would provide
educational services to New Moyer’s students through the 2020-2021 academic year,
unless terminated earlier. 17
On April 1, 2011, the Charter School Accountability Committee (the
“Committee”) issued a final report on New Moyer’s charter application. 18 The
Committee found that New Moyer satisfied thirteen of the fourteen criteria required for
approval under the Charter School Act. 19 The only criterion not satisfied was New
Moyer’s educational programming. 20 Regarding New Moyer’s proposed curriculum, the
Committee approved Science and Health Education; conditionally approved Math and
15
Id. at CW000417-18. The signed application states that the Moyer Board “has worked
closely with K12 in the development of [the] application.” Id. This representation is at
odds with the affidavit of Moyer Board’s Chairman, which implies that the Moyer Board
was not involved in the preparation of the application. See Curry Aff. ¶ 6.
16
Pls.’ Ex. 9 at CW000434.
17
Defs.’ Ex. 6 at DOE-MOYER000208.
18
Pls.’ Ex. 12.
19
See 14 Del. C. § 512.
20
Pls.’ Ex. 12 at CW001002.
7
Social Studies; but did not approve Physical Education, World Languages, Visual Arts,
or Performing Arts based on the information submitted. 21
In its report, the Committee recommended that the State Board approve New
Moyer’s charter application, subject to twenty-three conditions. Those conditions
included requiring the Moyer Board to submit to the Department a proposed Performance
Agreement “specifying measurable objectives with annual targets that is acceptable to the
Secretary” by February 15, 2012. 22 The Committee also required New Moyer to submit
its curricula for Math, Social Studies, Physical Education, World Languages, Visual Arts,
and Performing Arts for review and approval by the Department by August 1, 2012. 23
On April 21, 2011, the Secretary recommended, and the State Board approved, by
a 6-0 vote, the issuance of a charter to New Moyer, subject to the conditions in the
Committee’s final report. 24 The charter would permit New Moyer to begin operations
starting with the 2012-2013 academic year 25 and to remain open through the 2015-2016
academic year. 26
On February 7, 2012, nearly ten months after New Moyer received a charter, a
Department employee inquired about the status of New Moyer’s services agreement with
21
Id.
22
Id. at CW001006 (condition #16).
23
Id. (condition # 10).
24
Defs.’ Ex. 5 at DOE-MOYER001498.
25
Id.
26
Curry Aff. ¶ 5.
8
K12. The employee forwarded to Curry a copy of the draft services agreement that the
Moyer Board had submitted in its charter application and encouraged Curry to consult an
attorney regarding a final agreement. 27
On July 1, 2012, New Moyer officially took over operations at the former location
of Old Moyer. As of August 23, 2012, New Moyer still had not submitted an executed
services agreement to the Department. When a Department employee inquired about the
status of that agreement on August 23, Curry stated that New Moyer’s counsel was in
“the process of drafting the K12 Agreement.” 28
By December 3, 2012, New Moyer and K12 executed an Education Products and
Services Agreement (the “Services Agreement”), which was dated to be effective
retroactively as of July 1, 2012. 29 Under the Services Agreement, K12 would provide
educational services to New Moyer’s students, and New Moyer became “responsible for
monitoring K12’s performance under, and compliance with, the terms of this Agreement
27
Carwell Aff. ¶ 14; Curry Aff. Ex. C. The preliminary record does not reflect that
anyone at the Department had authored any part of that draft agreement or that the
Department mandated that the Moyer Board agree to the particular provisions of that
draft.
28
Defs.’ Ex. 7.
29
Pls.’ Ex. 11 at CW000967, 990.
9
in accordance with Applicable Law.” 30 The Services Agreement continues through the
2015-2016 academic year, unless terminated earlier. 31
D. New Moyer’s Performance in its First Year (2012-2013)
New Moyer failed to meet the August 1, 2012, deadline the Committee had set in
its April 2011 report to submit and receive approval of its curriculum. Thus, when New
Moyer opened in fall 2012, it lacked a curriculum approved by the Department. 32 On
November 19, 2012, the Department instructed New Moyer to submit the outstanding
curricula for approval no later than December 31, 2012. 33 This deadline was extended
further to May 31, 2013, by which time New Moyer submitted a proposed curriculum for
approval. 34 On June 11, 2013, content specialists at the Department prepared an internal
report noting certain deficiencies in New Moyer’s proposed curriculum. 35
The Department rated the overall academic performance of New Moyer for the
2012-2013 academic school year to be “below standard.” 36 Of the fifteen categories in
30
Id. at CW000972 (§ 3.1). The Services Agreement provides that Delaware law is the
applicable law. Id. at CW000968 (§ 1.2).
31
Id. at CW000973 (§ 5.1).
32
Carwell Aff. ¶ 2.
33
Defs.’ Ex. 8.
34
Carwell Aff. ¶ 3.
35
Pls.’ Ex. 28.
36
Pls.’ Ex. 26 at CW001085. The ratings system the Department used contains four
ratings, in descending order: (1) exceeds standard, (2) meets standard, (3) does not meet
(or below) standard, and (4) far below standard. Id. at CW001077.
10
which academic performance was rated, New Moyer received two ratings of “exceeds
standard,” two ratings of “meets standard,” six ratings of “below standard,” and five
ratings of “far below standard.” 37 For the 2012-2013 academic year, the percentage of
students scoring “proficient” according to Delaware state standards was 49.6% in English
Language Arts and 40.3% in Math, both of which were slightly below the 20th percentile
for all schools in the State. 38
E. New Moyer Requests to Modify its Curriculum
During its first year of operation, New Moyer deviated from the online instruction
method set forth in its charter application without obtaining the Department’s written
approval. 39 On November 19, 2012, the Department instructed New Moyer to submit a
proposed charter modification regarding this change in instruction method no later than
December 31, 2012. 40
On December 17, 2012, New Moyer applied to the Department to modify its
charter by changing its curriculum and by decreasing its authorized enrollment. 41
37
Id. at CW001085.
38
Pls.’ Ex. 39 at CW000744; Pls.’ Ex. 13 at CW001009.
39
Carwell Aff. ¶ 4.
40
Defs.’ Ex. 8.
41
Pls.’ Ex. 15.
11
Regarding the curriculum, New Moyer sought to change its instructional method for core
academic courses from online instruction to traditional, classroom instruction. 42
On May 30, 2013, the Committee met with New Moyer representatives to discuss
the charter modification proposal. 43 On June 27, 2013, the Committee recommended that
the Department deny New Moyer’s request because of deficiencies in its proposal,
including the curricula for English Language Arts, Math, and Social Studies. 44
On July 18, 2013, the State Board was informed that the Secretary had denied
New Moyer’s charter modification request. Because this charter modification required
approval by both the Secretary and the State Board, the State Board took no further action
on New Moyer’s request. 45
On July 25, 2013, the Department met with representatives of New Moyer to
discuss its curriculum. Moyer Board’s Chairman understood the importance of this
meeting. Beforehand, in a July 18 email, Curry stated that the meeting “should not be
taken lightly. We will be given hard deadlines and if we do not produce, Moyer’s future
is no more!” 46
42
Id. at CW001056-57; Carwell Aff. ¶ 5.
43
Defs.’ Ex. 9 at MOYER-COVERDALE000164.
44
Id. at MOYER-COVERDALE000154-63.
45
Defs.’ Ex. 10 at DOE-MOYER001628.
46
Defs.’ Ex. 11.
12
After the July 25 meeting, the Department sent New Moyer a “Curriculum
Refinement Review,” which provided detailed feedback on New Moyer’s curriculum. 47
Similarly, on July 26, 2013, the Department provided New Moyer with a “Corrective
Action Plan,” which set forth “the expectations of the Department, the deadlines that
must be met, and the areas in which the Department will engage in ongoing monitoring of
[New] Moyer’s progress.” 48 The Department further informed New Moyer that, as part
of the Corrective Action Plan, it would conduct site visits during September and October
2013. 49
During the Corrective Action Plan period, the Department provided feedback on
New Moyer’s curriculum in reports dated October 3, 2013, October 27, 2013, and
January 9, 2014. 50 On November 8, 2013, the Department also provided New Moyer
with a report explaining certain observations in its monitoring of the Corrective Action
Plan, noting that New Moyer’s curriculum “continue[d] to lack coherence, appropriate
progressions and alignment with assessments, and [did] not align to Common Core State
Standards.” 51 The report further noted that the Department had “found little
47
Carwell Aff. ¶ 9, Ex. E.
48
McLaughlin Aff. ¶ 2.
49
Id. Ex. B at DOE-MOYER001758.
50
Rouser Aff. ¶ 4, Exs. A-C. A Department employee noted in an affidavit that
“[s]everal overarching areas of misalignment of New Moyer’s curriculum with the State
Standards for math, English language arts (ELA), science and social studies were
identified in each of these reports.” Id. ¶ 5.
51
McLaughlin Aff. ¶ 5, Ex. E.
13
improvement over the submissions that resulted in the denial of [New Moyer’s]
modification application in July, 2013.” 52
F. New Moyer’s Performance in its Second Year (2013-2014)
On September 24, 2013, after New Moyer had operated for one academic year,
New Moyer and the Department entered into the Performance Agreement, 53 which had
been a condition of New Moyer’s charter. 54 The Performance Agreement set forth
certain performance expectations for New Moyer, including:
By 2015, [New Moyer’s] expectation is to achieve the overall rating of
“Meets” or “Exceeds” standard as measured by the Academic Performance
Framework. Each year, [New Moyer] will show growth within [its] overall
rating putting [it] on track to achieve [its] academic performance
expectations. This progress will be monitored through [its] annual
performance review. 55
The Performance Agreement would “continue in full force and effect during the term of
the school’s charter and any subsequent renewal term thereof.” 56 Although the
Performance Agreement is styled as a contract, it does not include any representations or
warranties, covenants, or other obligations on behalf of the Department. Indeed, the
Performance Agreement provides that “in the sole discretion of the [Department], with
the assent of the [State Board], this agreement may be amended at such time as the
52
Id.
53
Pls.’ Ex. 18.
54
Pls.’ Ex. 12 at CW001006 (condition #16); Pls.’ Ex. 9 at CW000492 (assurance #13).
55
Pls.’ Ex. 18 at CW000561.
56
Id. at CW000559.
14
school’s charter may be renewed under the provisions of 14 Del. C. § 515(b) or subjected
to review under 14 Del. C. § 515(c).” 57
In January 2014, the Department conducted an on-site monitoring visit of New
Moyer’s special education services. The Department found 67 of 68 student records to
be noncompliant with regulations under the federal Individuals with Disabilities
Education Act, including the requirement of Individualized Education Plans (“IEPs”). 58
In February 2014, the Department notified New Moyer in writing of the on-site
monitoring results. 59
On February 27, 2014, the Department met with representatives of New Moyer to
discuss its observations, to conduct a “Root Cause Analysis,” and to develop a
“Corrective Action Plan” to ensure New Moyer’s compliance with federal and State
special education regulations. 60 On March 7, 2014, the Department provided certain
professional development services to New Moyer representatives. 61 The Department set
a deadline of April 1, 2014, for New Moyer to correct noncompliance in the 67 IEPs
previously identified as noncompliant (“Prong 1”), and another deadline of May 1, 2014,
57
Id. at CW000559 (§ 2) The Performance Agreement additionally provides that, “[i]f
the [Department] finds that the school is not making satisfactory progress toward its
performance targets the [Department], with the assent of the [State Board], may place the
school’s charter on formal review pursuant to 14 Del. C. § 515(c).” Id. (§ 3(b)).
58
Mazza Aff. ¶ 4.
59
Id. ¶ 5.
60
Id. Ex. A.
61
Id. ¶ 7, Ex. B.
15
for New Moyer to correct any systemic noncompliance in its special education
procedures (“Prong 2”). 62 These deadlines were extended twice, ultimately to May 16,
2014 (for Prong 1) and May 31, 2014 (for Prong 2). 63
In May and June 2014, the Department reviewed New Moyer’s updated files for
Prong 1 and concluded that 29 student records were still noncompliant. 64 On June 23,
2014, the Department sent a letter to New Moyer outlining its monitoring of New
Moyer’s compliance with special education regulations. 65 Because of the outstanding
noncompliance, the Department required New Moyer to enter into the Compliance
Agreement, 66 which it did in July 2014. 67
The Compliance Agreement required New Moyer to correct the 29 noncompliant
student records by September 19, 2014. On September 19, the Department reviewed
New Moyer’s updated files and orally informed New Moyer that it was in compliance
with Prong 1. 68 The Department then further extended the deadline for New Moyer to
62
Id. ¶ 6.
63
Id. ¶ 7.
64
Id. ¶ 8.
65
Id. ¶ 9.
66
Id. Ex. C.
67
Id. Ex. D.
68
Id. ¶ 12; Curry Aff. ¶¶ 27-28, Ex. M.
16
satisfy Prong 2, to correct any systemic noncompliance in New Moyer’s special
education procedures, until November 3, 2014. 69
The Department rated the overall academic performance of New Moyer for the
2013-2014 academic school year to be “far below standard.” 70 Of the seventeen
categories in which academic performance was rated (the fifteen categories from the prior
year plus two new categories), New Moyer received zero ratings of “exceeds standard,”
one rating of “meets standard,” three ratings of “below standard,” and thirteen ratings of
“far below standard.” 71 The test scores of New Moyer students on the Delaware
Comprehensive Assessment System were the lowest of any charter school in the State. 72
For the 2013-2014 academic year, the percentage of students scoring “proficient”
according to Delaware state standards was 23.1% in English Language Arts, a decrease
from 49.6% for the prior year; 10.2% in Math, a decrease from 40.3% in the prior year;
6.2% in Science, a decrease from 12.1% in the prior year; and 0% in Social Studies, a
decrease from 39.3% in the prior year. 73
69
Mazza Aff. ¶ 12. On November 3, 2014, the Department reviewed 26 individual
student records and concluded that ten were noncompliant with special education
regulations. Id. ¶ 13. Plaintiffs note, logically, that these additional examples of
noncompliance cannot support the decision to revoke Moyer’s charter since they were
found after that decision had been made in October 2014.
70
Pls.’ Ex. 26 at CW001085.
71
Id.
72
Pls.’ Ex. 31 at CW000666.
73
Pls.’ Ex. 39 at CW000744-45; see also Pls.’ Ex. 26 at CW001078.
17
The Department also measured the growth of New Moyer students during the
academic year. 74 The percentage of New Moyer students meeting their academic growth
targets fell from 70% in English Language Arts and 55.2% in Math for the 2012-2013
year to 28.1% in English Language Arts and 39.5% in Math for the 2013-2014 year. 75
Although 61% of New Moyer’s student body for the 2013-2014 year had attended a
different school in the prior year, there was only a “nominal difference” between the
growth rate performances in these subjects for students who attended New Moyer for
both 2012-2013 and 2013-2014 compared to those who attended for only 2013-2014. 76
G. New Moyer Again Requests to Modify its Curriculum
On May 13, 2014, New Moyer applied for a major modification of its charter to
adopt a curriculum provided by SpringBoard in English Language Arts and Math. 77 The
Department had earlier suggested the SpringBoard curriculum to New Moyer in March
and April 2014. 78 SpringBoard, which several Delaware schools use, would allow New
74
Johnson Aff. ¶ 6.
75
Pls.’ Ex. 26 at CW001077.
76
Defs.’ Ex. 16 (“Students who attended Moyer in both 12-13 and 13-14 met 40% of
their Math targets, compared to 34% of students attending Moyer in only 13-14.
Similarly for ELA, 27% of students who attended for both 12-13 and 13-14 met their
targets, compared to 25% of students who attended for only 13-14.”).
77
Pls.’ Ex. 27.
78
Curry Aff. ¶¶ 13-14.
18
Moyer to “use Delaware certified teachers to deliver instruction in [its] core courses,”
while continuing to use online instruction in its elective courses. 79
On June 12, 2014, the Committee met with New Moyer representatives to discuss
its modification request. On June 17, 2014, the Committee issued an initial report on
New Moyer’s request in which it expressed concern about implementing a new
curriculum, and requested additional information regarding New Moyer’s professional
development and teacher instruction plans. 80
On July 9, 2014, the Committee again met with representatives of New Moyer. 81
The Committee agreed to recommend New Moyer’s request for charter modification
pending submission of satisfactory documents by July 14, 2014, to address six areas of
concern, which included providing a plan to fill student knowledge gaps in the proposed
transition from K12 to SpringBoard and professional development for teachers. 82
On July 21, 2014, the Committee issued its final report recommending non-
approval of New Moyer’s charter modification request. 83 New Moyer had adequately
addressed only two of the Committee’s six areas of concern by July 14. 84 The four
unsatisfactory areas of concern included student knowledge gaps. According to the
79
Pls.’ Ex. 27 at CW000597, 600.
80
Pls.’ Ex. 29 at CW001093-94.
81
Pls.’ Ex. 30 at CW000676.
82
Id. at CW000682.
83
Id. at CW000683.
84
Id.
19
Committee, New Moyer failed to provide “a detailed plan for placing students in courses,
[and] an indication of the specific data that will be used to place students or determine
deficits in prerequisite skills and knowledge.” 85
On August 5, 2014, the Committee held a public hearing in Dover, Delaware on
its final report. 86 According to the transcript, no representative of New Moyer addressed
the Committee at this hearing. On August 21, 2014, at a State Board meeting, the
Secretary announced his decision to accept the Committee’s recommendation and deny
New Moyer’s charter modification request. 87 In light of the Secretary’s decision, the
State Board took no further action on New Moyer’s request. 88
H. The Department Places New Moyer under “Formal Review”
On July 17, 2014, with the assent of the State Board, the Secretary sent a letter to
the Moyer Board informing its members that New Moyer was being placed on Formal
Review. 89 The Secretary set forth seven areas in which New Moyer was noncompliant
85
Id. The other unsatisfactory areas were: (i) Common Core standards for mathematical
practice; (ii) assessments; and (iii) pacing instruction. Id.
86
Defs.’ Ex. 14.
87
Defs.’ Ex. 15 at DOE-MOYER001752.
88
Id. Plaintiffs note that, on August 19, 2014, Curry requested to meet with the
Department’s curriculum professionals to discuss New Moyer’s charter modification
request. Pls.’ Reply Br. Ex. B. The evidence reflects that there was no such meeting
before or after the August 21, 2014, State Board meeting. Curry Aff. Ex. H.
89
Pls.’ Ex. 31. The Formal Review notice came one month after the University of
Delaware, the Delaware Academy for School Leadership, and the Department released a
Comprehensive School Review of New Moyer on June 17, 2014. Defs.’ Ex. 17. The
report noted, among other findings, that New Moyer “lacks a clear mission and vision
20
with State law and/or its charter: (i) academic performance; (ii) special education
services; (iii) educational programming; (iv) discipline and attendance; 90 (v) student
assessment; (vi) staff credentialing; and (vii) financial and administrative operations. 91
that focus instruction and to provide a unifying purpose,” and that “[t]here is an
organizational structure disconnect among board, school leadership, staff, and K12
management.” Id. at DOE-MOYER001141. The report also noted that “[s]tudents report
that they do not feel safe in school” in part because “the front door is routinely unlocked
so anyone can get into the halls and classrooms.” Id. at DOE-MOYER001181.
90
Under the category of disciple and attendance, the letter identified six items of concern.
The first item reported that the out of school suspension rate for New Moyer students for
the 2013-2014 academic year was 61% as opposed to the State average of 9%. Pls.’ Ex.
31 at CW000667. Plaintiffs make much of the fact that, on October 8, 2014, New Moyer
informed the Department that its suspension data were incorrect because one student was
listed as suspended for 400 days after he no longer attended the school. Curry Aff. ¶¶ 30-
32, Ex. P. The Department reviewed the issue and concluded that their records and
statistics were not affected by this error because their analysis did not rely on the data
field in which the error was made. Nagourney Aff. ¶ 4, Ex. A. Plaintiffs have not
identified any discrepancies regarding the five other items the Department had identified
concerning discipline and attendance, three of which the Secretary identified in his letter
of October 13, 2014 (in addition to the 61% suspension rate), as part of the grounds for
his revocation decision concerning the issue of discipline and attendance. See Pls.’ Ex.
43 at CW000825.
91
Pls.’ Ex. 31 at CW000666-67.
21
Attached to the Secretary’s letter was a timeline for the Formal Review process. 92 The
Secretary’s Formal Review notice was also posted on the Department’s website. 93
I. The Committee Recommends Revocation of New Moyer’s Charter
As required by Section 515(c) of the Charter School Act, the Department
appointed the Committee to conduct an initial review of New Moyer to determine
whether New Moyer was in compliance with its charter and all applicable laws and
regulations, and, if not, to determine whether remedial measures were appropriate. 94 On
August 5, eleven representatives of New Moyer, including four members of the Moyer
92
The attachment outlining the Formal Review timeline is not in the record but is
publicly available. See Formal Review Process Timeline, Delaware Department of
Education (Sept. 2, 2014), available at http://www.doe.k12.de.us/cms/lib09/DE01922744
/Cntricity/Domain/151/Formal%20Review%20Process/2014-15%20Formal%20Review/
UpdatedMJMFormalReviewTimeline.pdf. I take judicial notice of this information
because it is not subject to reasonable dispute. D.R.E. 201(b); In re Lear Corp. S’holder
Litig., 967 A.2d 640, 656 (Del. Ch. 2008) (taking judicial notice on plaintiffs’
preliminary injunction motion).
93
The original link to the Secretary’s Formal Review notice inadvertently directed to a
notice for a different charter school. On July 18, 2014, the day after the Formal Review
notice was posted online, this issue was brought to the attention of the Charter School
Office, and the website link was corrected that day. Nagourney Aff. ¶ 8; Defs.’ Ex. 19.
When this action was filed on November 25, 2014, however, the link to the New Moyer
Formal Review notice again had been directed to the wrong document. Defendants assert
that this error likely was caused by an update to the Department’s website on November
7, 2014—nearly a month after the Secretary and the State Board would vote to revoke
New Moyer’s charter. Nagourney Aff. ¶ 8; Pls.’ Ex. 32. There is no evidence reflecting
that the link was, in fact, incorrect between July 18 and November 7. I credit the
Nagourney affidavit and conclude for purposes of this opinion that the correct Formal
Review notice was available on the Department’s website from July 7 to November 7.
94
Pls.’ Ex. 39 at CW000744; Pls.’ Ex. 31 at CW000666.
22
Board, met with the Committee to discuss the seven areas identified in the Secretary’s
Formal Review notice. 95 Two members of the public also attended this meeting. 96
Also on August 5, 2014, immediately following the Committee’s public hearing
on New Moyer’s charter modification request to use SpringBoard, the Committee held a
public hearing in Dover on the Formal Review process. The transcript of this Committee
meeting reflects that: (i) New Moyer was notified of the hearing in the Secretary’s
Formal Review notice; (ii) on July 18, 2014, a notice of the meeting was placed on the
Department’s website and on the State’s online public meeting calendar; and (iii) also on
July 18, a notice of the hearing was published in The News Journal and Delaware State
News. 97 Keenan Dorsey, the principal of New Moyer, made comments on the record. 98
On August 7, 2014, the Committee issued its Initial Report recommending that
New Moyer be found noncompliant with its charter and relevant Delaware regulations
based on the same seven areas of noncompliance identified in the Secretary’s Formal
Review notice. 99 New Moyer was given the opportunity to respond in writing to the
Initial Report by August 22, 2014.
95
Defs.’ Ex. 18 at DOE-MOYER001278-87.
96
Id. at DOE-MOYER001279.
97
Pls.’ Ex. 33 at CW000700.
98
Id. at CW000704-07; Nagourney Aff. ¶ 7.
99
Defs.’ Ex. 18 at DOE-MOYER 001287-88.
23
On August 19, 2014, New Moyer submitted a written response. 100 In its response,
New Moyer asserted that its population was “severely underprivileged, underserved and
underprepared” in that 75% of the current student body was new to the school; 32% of
the student body was identified as special needs students; and the students who attend the
school had reading proficiencies that, on average, were three grade levels below their
target grade level. 101 New Moyer further explained that, despite turnover in its special
education department, it hired a Special Education Director in February 2014, who in
turn hired three special education teachers and four paraprofessionals for the 2014-2015
academic year. 102 As to the suspension rate, New Moyer noted that its “zero tolerance
approach” to disciplinary infractions was perhaps an “overcorrect[ion],” and that it had
submitted to have an on-campus School Resource Officer. 103
100
Pls.’ Ex. 20.
101
Id. at CW000730 (“6th grade is reading on average at a 5th grade level; 7th grade is
reading on average at a 4th grade level; 8th grade is reading on average at a 4th grade
level; 9th grade is reading on average at a 6th grade level; [and] 10th grade is reading on
average at a 7th grade level.”).
102
Id. at CW000732.
103
Id. at CW000734. New Moyer also represented that it would not seek a charter
renewal if it did not make significant improvements:
The State has our further commitment, and we will make it binding in
whatever fashion the State desires, that should we not make significant
improvements in special education documentation and reporting during this
school year and show measurable growth in student achievement during
that same time, the [Moyer] Board will not seek renewal at the end of its
charter term.”
Id. at CW000730.
24
On August 29, 2014, the Committee held a public meeting in Dover, Delaware.
Seven representatives of New Moyer, including two members of the Moyer Board,
attended, as well as two representatives from the public. 104 At this meeting, the
Committee unanimously agreed that New Moyer was noncompliant with four of the
seven areas identified in the Secretary’s Formal Review notice: (i) academic
performance; (ii) special education services; 105 (iii) educational programming; and (iv)
school discipline. 106 Before the Committee voted on its recommendation to the
Department regarding the appropriate remedial measures, one Committee member noted
how he did not consider probation appropriate for New Moyer:
[The Committee member] also stated that, if areas of noncompliance in
student achievement were not as significant as they are and the previous
two years had not been as difficult as they were, it would be easier to
recommend probation and place faith in [New] Moyer. He explained that
there was too much history over the last two years and the issues
concerning services to Special Education students make it difficult to set
aside. 107
A majority of the Committee then voted (by a 3-0 vote, with one member abstaining) to
recommend that New Moyer’s charter be revoked, effective June 30, 2015. 108
104
Pls.’ Ex. 39 at CW000747; see also Pls.’ Ex. 34.
105
The Committee’s report for the August 29 meeting references that, of the 67 out of 68
IEPs that had been found noncompliant, 29 remained noncompliant and that the
Department would be returning to New Moyer in September to determine whether these
29 IEPs have been brought into compliance. Pls.’ Ex. 39 at CW000748-49.
106
Id. at CW000751.
107
Id.
108
Id.
25
On September 5, 2014, the Committee issued its Final Report, which
recommended, for the four reasons listed at its August 29 meeting, revocation of New
Moyer’s charter, effective June 30, 2015. 109 New Moyer was given the opportunity to
respond in writing to the Final Report by September 15, 2014, but New Moyer declined
to do so. 110
J. The Secretary and the State Board Revoke New Moyer’s Charter
On September 10, 2014, the Department and the State Board held a joint public
hearing in Wilmington, Delaware to discuss the Committee’s Final Report. 111 The
transcript of this joint hearing reflects that: (i) on July 19, 2014, New Moyer was notified
of the hearing; (ii) on August 18, 2014, a notice of the hearing was placed on the
Department’s website and on the State’s online public meeting calendar; and (iii) also on
August 18, a notice of the hearing was published in The News Journal and Delaware
State News. 112 Six representatives of New Moyer, including three Moyer Board members
and its principal, made comments on the record. 113
109
Pls.’ Ex. 39. Plaintiffs contend that the Final Report did not specifically address New
Moyer’s request to modify its charter to change its English Language Arts and Math
instruction from K12 to SpringBoard, but the SpringBoard curriculum was one of the
subjects discussed at this meeting. A Committee member “clarified for the record that
[New] Moyer is still implementing SpringBoard notwithstanding the fact that the recent
charter modification application was denied.” Id. at CW000749.
110
Nagourney Aff. ¶ 10.
111
Pls.’ Ex. 40.
112
Id. at CW000756; Nagourney Aff. ¶ 7.
113
Pls.’ Ex. 40 at CW000758, 763, 768, 771, 774, 779.
26
On October 9, 2014, at a public meeting of the State Board, the Secretary
announced his decision to accept the recommendations of the Committee’s Final Report
to revoke New Moyer’s charter, effective June 30, 2015. 114 The Secretary explained that
the Final Report “highlight[s] significant problems with the school’s academic
performance and its program,” specifically noting:
• New Moyer “is at the bottom of the traditional district schools and charter schools
in regards to student achievement”;
• The percentage of students at New Moyer who tested proficient for the 2013-2014
academic year was 10% in Math, 23% in English Language Arts, 6% in Science,
and 0% in Social Studies;
• The proficiency scores of New Moyer’s students for the 2013-2014 academic year
were lower than the proficiency scores for the 2012-2013 academic year, “which
also fell far below state averages”; and
• Significant challenges the school faced with respect to special education needs,
including the requirements for IEPs and adequate staffing. 115
114
Pls.’ Ex. 41 at CW001154.
115
Id. In summation, the Secretary stated:
While the public record makes clear the school’s dedication to
improvement, my decision must be based upon evidence and not intentions.
The accountability committee has determined that the school has failed to
comply with its charter and satisfy in its operation of the school the criteria
set forth in the charter law. To note specifically two areas, the school has
failed to meet the academic standards and special education services
criteria.
Id. After the revocation decision had been made, the Secretary spoke at a meeting of the
Wilmington City Council and discussed the reasons why the Department was
recommending a new assessment test for the State. Plaintiffs contend that the Secretary
stated that Delaware’s current testing standards, the performance on which was a basis
for the decision to revoke New Moyer’s charter, were unreliable. Pls.’ Op. Br. 25. Based
on my review of the relevant parts of the recording identified by Defendants, Defs.’ Ans.
27
The State Board then unanimously agreed (by a 7-0 vote) with the Secretary to revoke
New Moyer’s charter. 116
On October 13, 2014, sixty-one working days (excluding the Labor Day holiday)
after the Secretary’s Formal Review notice, the Secretary notified New Moyer by letter of
his and the State Board’s decision to revoke New Moyer’s charter, effective June 30,
2015. 117 The letter outlined the four areas of noncompliance that formed the basis for the
revocation decision: (i) academic performance (pursuant to New Moyer’s Performance
Agreement); (ii) special education services (pursuant to Section 512(7) of the Charter
School Act); (iii) educational programming (pursuant to Section 512(6) of the Charter
School Act); and (iv) discipline and attendance (pursuant to Section 512(11) of the
Charter School Act). 118
K. Procedural History
On November 25, 2014, three Individual Plaintiffs and the City of Wilmington
filed an action (C.A. No. 10398) against the Department, the Secretary, the State Board,
Br. 32-33 n.21, the Secretary noted how the Department wanted to improve on what was
already “one of the most sophisticated assessments in the country.”
116
Pls.’ Ex. 41 at CW001155. Plaintiffs note that neither the Secretary nor the State
Board acknowledged at the October 9 meeting that New Moyer had, as of the September
19 deadline, satisfied Prong 1 of its Compliance Agreement for special education
services. Although Plaintiffs are correct, it bears mention that the public comment period
for the revocation decision closed on September 15 (before the September 19 deadline).
See Formal Review Process Timeline, referenced supra. at n. 92.
117
Pls.’ Ex. 43.
118
Id. at CW000824-25.
28
and each of its members. On November 26, 2014, five other Individual Plaintiffs and
New Moyer filed another action (C.A. No. 10402) against the Department, the Secretary,
and the State Board. On December 2, 2014, I entered an order consolidating these two
actions.
On December 3, 2014, I granted the parties’ stipulated order for expedited
proceedings. On December 5, 2014, Plaintiffs filed a Consolidated Complaint. 119
On December 19, 2014, Plaintiffs moved for a preliminary injunction “enjoining
Defendants from implementing the decision revoking New Moyer’s charter and closing
the New Moyer School at the close of the current school year (June 2015).” Plaintiffs
request a ruling before January 14, 2015, the deadline for students to apply to the school
of their choice under the Delaware School District Enrollment Choice Program (the
“Choice Program”).
Also on December 19, 2014, Defendants moved to dismiss the Consolidated
Complaint under Court of Chancery Rule 12(b)(6) for failure to state a claim. On
January 2, 2015, I heard oral argument on Plaintiffs’ motion for a preliminary injunction
and Defendants’ motion to dismiss.
119
The Consolidated Complaint asserts seven causes of action: failure to comply with the
Delaware Choice Program (Count I); further violation of the Charter School Act (Count
II); due process (Count III); breach of charter contract (Count IV); breach of implied
covenant (Count V); parens patriae claims (Count VI); and arbitrary and capricious
decision-making (Count VII).
29
Given the exigencies of Plaintiffs’ preliminary injunction application, this opinion
addresses the issues necessary to resolve Plaintiffs’ motion, but I also have considered the
parties’ briefing on Defendants’ motion to dismiss.
III. LEGAL ANALYSIS
A. The Legal Standard
“[A] motion for preliminary injunctive relief requires [the Court] to take a step
that, procedurally speaking, is extraordinary: to make a ‘preliminary’ determination of
the merits of a cause before there can be a final adjudication of [Plaintiffs’] claims.”120
To obtain a preliminary injunction, Plaintiffs must establish three elements: (i) a
reasonable probability of success on the merits; (ii) irreparable harm absent interim relief;
and (iii) that the balance of the equities favors the relief requested. 121 “This burden is not
a light one, and an ‘extraordinary remedy’ like a preliminary injunction ‘will never be
granted unless earned.’” 122 Although “[a] strong showing on one element may overcome
a weak showing on another element,” Plaintiffs must still demonstrate all three
elements. 123
120
Frazer v. Worldwide Energy Corp., 1987 WL 8739 (Del. Ch. Feb. 19, 1987), reprinted
at 13 Del. J. Corp. L. 294, 303 (1987).
121
See Revlon, Inc. v. MacAndrews & Forbes Hldgs., Inc., 506 A.2d 173, 179 (Del.
1986).
122
Wayne Cty. Empls.’ Ret. Sys. v. Corti, 954 A.2d 319, 329 (Del. Ch. 2008) (quoting
Lenahan v. Nat’l Computer Analysts Corp., 310 A.2d 661, 664 (Del. Ch. 1973)).
123
See Cantor Fitzgerald, L.P. v. Cantor, 724 A.2d 571, 579 (Del. Ch. 1998).
30
B. Reasonable Probability of Success on the Merits
In support of their preliminary injunction application, Plaintiffs advance claims
that “collectively comprise a due process claim or set of claims under the Fourteenth
Amendment” of the United States Constitution. 124 The precise demarcation of Plaintiffs’
constitutional claims is unclear. Plaintiffs asserted both procedural and substantive due
process challenges in their briefs concerning the decision to revoke New Moyer’s charter,
although they acknowledged at oral argument that their due process claims are primarily
procedural and not substantive. 125 Because the City of Wilmington concedes that its
claims as parens patriae are identical to those of the Individual Plaintiffs’ claims, 126 I
address only the claims of the Individual Plaintiffs and New Moyer in this opinion.
1. Procedural Due Process Claim
The Due Process Clause of the Fourteenth Amendment provides, “[N]or shall any
State deprive any person of life, liberty, or property, without due process of law.” When
a plaintiff asserts a violation of the Due Process Clause, the threshold question “is
124
Pls.’ Op. Br. 43.
125
Tr. of Oral Arg. 10 (“I don’t think we are arguing that this is primarily a substantive
due process case.”), 40 (“The parties have focused on procedural due process in the
briefing.”).
126
Pls.’ Reply Br. 26 n.12 (“[T]he claims of the Individual Plaintiffs and the City are
identical[.]”); see also Harden v. Christina School Dist., 924 A.2d 247, 267 n.120 (Del.
Ch. 2007).
31
whether the plaintiff has been deprived of a protected interest in ‘property’ or
‘liberty.’” 127
A property interest entitled to procedural due process under the Due Process
Clause is created and defined not by the Constitution, but rather by “existing rules or
understandings that stem from an independent source such as state law—rules or
understandings that secure certain benefits and that support claims of entitlement to those
benefits.” 128 “To have a property interest in a benefit, a person clearly must have more
than an abstract need or desire for it. He must have more than a unilateral expectation of
it. He must, instead, have a legitimate claim of entitlement to it.” 129
As a general matter, “[w]hen the decision to grant or withhold a benefit is
entrusted to the discretion of a government actor, one has no constitutional property
interest in obtaining that relief.” 130 “If the decisionmaker is not ‘required to base its
decisions on objective and defined criteria,’ but instead ‘can deny the requested relief for
any constitutionally permissible reason or for no reason at all,’ the State has not created a
constitutionally protected . . . interest.” 131 In other words, there is no protected property
127
Am. Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S. 40, 59 (1999) (citations omitted).
128
Bd. of Regents of State Colls. v. Roth, 408 U.S. 564, 577 (1972).
129
Id.
130
Suryanto v. Att’y Gen. of U.S., 398 F. App’x 830, 834 (3d Cir. 2010) (citing Conn. Bd.
of Pardons v. Dumschat, 452 U.S. 458, 564 (1981)).
131
Olim v. Wakinekona, 461 U.S. 238, 249 (1983) (finding no legitimate claim of
entitlement where there were “no standards governing the administrator’s exercise of his
discretion” to transfer an inmate) (citation omitted).
32
interest where the decision to remove a benefit is left to the “unfettered discretion” of the
government actor. 132 Conversely, the State may create a constitutionally protected
interest by placing a “substantive limitation on official discretion” to grant, deny, or
remove a benefit. 133
a. New Moyer Has No Protected Property Interest 134
New Moyer contends that the charter it received from the Department to operate a
school is “a government license, not a contract,” and thus constitutes a protected property
132
See Roth, 408 U.S. at 566-67 (concluding a nontenured university professor had no
property interest in his position because “State law . . . clearly leaves the decision
whether to rehire a nontenured teacher for another year to the unfettered discretion of
university officials.”).
133
See Mullen v. Thompson, 155 F. Supp. 2d 448, 452 (W.D. Pa. 2001) (citing Olim, 461
U.S. at 249-50) (“[S]tate law that establishes purely procedural rules does not create
federal due process rights. Rather, only those state laws that place a substantive
limitation on official discretion in the decision to grant or deny the benefit itself—not in
the process leading to that decision—create a property interest that is entitled to
constitutional protection under the Due Process clause.”) (“Mullen I”), aff’d, 31 F. App’x
77 (3d Cir. 2002); see also Greenholtz v. Inmates of Neb. Penal & Corr. Complex, 442
U.S. 1, 11-12 (1979) (“accept[ing] respondents’ view that the expectancy of release
provided in [a] statute is entitled to some measure of constitutional protection” where the
state statute provided that the board of parole “shall order” the release of a committed
offender who is eligible for release on parole unless the board determines that the release
should be deferred for one of four enumerated reasons); Griffeth v. Detrich, 603 F.2d
118, 121 (9th Cir. 1979) (finding a legitimate claim of entitlement for “persons who
claim to meet the eligibility requirements” where the state’s welfare application
regulations were “comprehensive and definite” and “greatly restrict[ed] the discretion of
the intake eligibility worker”).
134
Defendants challenge New Moyer’s standing to assert any claims in this action. For
purposes of Plaintiffs’ preliminary injunction motion only, I assume that New Moyer has
standing.
33
interest. 135 In opposition, Defendants argue that, because “the decision to withhold,
grant, or revoke a public school charter is a discretionary one,” the charter New Moyer
received from the Department was a “privilege” and thus not a protected interest. 136
In my opinion, New Moyer does not have a constitutionally protected property
interest in its charter because, under Delaware law, the Department’s decision to revoke
its charter was discretionary. In adopting the Charter School Act, the General Assembly
created a statutory scheme governing the Department’s oversight of Delaware charter
schools. A charter may be issued by an approving authority (i.e., a public school district
or the Department) with the approval of the State Board. 137 The Charter School Act
prescribes certain actions an approving authority must take, and others are left to the
approving authority’s discretion. I conclude, for the reasons that follow, that the
Department’s decision to revoke New Moyer’s charter falls within the latter category.
The Department’s decision to revoke New Moyer’s charter implicates Sections
515(f) and 516(2) of the Charter School Act. Under Section 516(2), an approved charter
“shall be subject to revocation or probation, after the exercise of due diligence and good
faith,” if the approving authority (here, the Department) determines that “[t]he school
fails to comply with its charter or to satisfy, in its operation of the school, the criteria set
135
Pls.’ Op. Br. 48.
136
Defs.’ Ans. Br. 36.
137
14 Del. C. § 503.
34
forth in [Section] 512.” 138 Thus, the Department’s determination under Section 516(2)
about whether New Moyer’s charter was subject to possible revocation or probation uses
the mandatory “shall” and is qualified by reference to the sixteen criteria specified in
Section 512, which are the conditions required for the issuance of a charter. Critically,
however, under Section 515(f), the ultimate decision to revoke a charter is permissive as
the statute uses the term “may” and is not qualified by reference to any criteria:
If the approving authority determines that the criteria for remedial action set
forth in § 516 of this title have been satisfied, it may revoke the charter and
manage the school directly until alternative arrangements can be made for
students at the school or place the school on a probationary status subject to
terms determined by the approving authority which are directly relevant to
the violation or violations. 139
In my view, the ability of the Department to revoke a charter is discretionary because
there are no substantive limits on the Department’s decision-making process. Although
the Department does not have the discretion to revoke a charter unless that charter is
subject to revocation under Section 516, once a charter is subject to revocation, Section
515(f) affords the Department the discretion to revoke or not to revoke it. No provision
of the Charter School Act sets forth any criteria that mandates or prohibits revocation
under Section 515(f). Because the Department’s decision to revoke a charter ultimately
138
14 Del. C. § 516(2). A charter shall also be subject to revocation or probation if, after
the exercise of due diligence and good faith, the approving authority determines that
“[t]he school, or its representatives, has committed a material fraud on the approving
authority or misappropriated federal, state or local funds.” 14 Del. C. § 516(1).
139
14 Del. C. § 515(f) (emphasis added).
35
is discretionary and not subject to any substantive limits, I conclude that New Moyer has
no legitimate claim of entitlement to the four-year charter it received. 140
My conclusion is supported by Chief Judge Stark’s recent decision in Reach
Academy for Boys and Girls, Inc. v. Delaware Department of Education, 141 in which he
addressed whether students had a protected property interest in a charter where the
Department decided not to renew the charter after its initial term. Under Section 514A(b)
of the Charter School Act, the Department has the authority to decide, at the end of a
charter’s term, whether to renew the charter: a charter “may be renewed for successive 5-
year terms.” 142 There is no mandatory “shall” or objective criteria that prescribes, one
way or the other, whether to renew a charter. Focusing on the use of the word “may” in
Section 514A(b), Chief Judge Stark concluded that the plaintiffs—individual students
who attended the charter school—had no constitutionally protected property interest in
140
New Moyer also asserts that the Performance Agreement is a basis for its
constitutionally protected property interest. I disagree. The language of the Performance
Agreement, providing that it would “continue in full force and effect during the term of
the school’s charter,” does not supersede or otherwise restrict the Department’s discretion
under Section 515(f) to revoke New Moyer’s charter before its expiration. The
Department perhaps could have entered into such an arrangement with New Moyer, but
such an agreement would have vastly different provisions than the one-sided terms of the
Performance Agreement, which impose no obligations on the Department and expressly
recognize the Department’s right to place a charter on formal review. See supra note 57.
Thus, New Moyer has no legitimate claim of entitlement as a Constitutional matter to its
charter under the Performance Agreement.
141
2014 WL 2445804, -- F. Supp. 2d – (D. Del. May 30, 2014), modifying 8 F. Supp. 3d
(D. Del. 2014).
142
14 Del. C. § 514A(b) (emphasis added).
36
the school’s charter because the Charter School Act vested the Department “with the
discretion to renew or not renew charters.” 143
The use of the “may” in Section 515(f)—without any specific criteria to guide the
Department’s determination of whether a charter subject to revocation should actually be
revoked—is analytically similar to the use of the “may” in Section 514A. Although
Section 515(f) operates differently than Section 514A(b) in that only Section 515(f)
references the criteria incorporated into Section 516, this is a distinction without a
difference in my view. There is no statutory analogue for when a charter “shall be
subject” to renewal because there is no need for one. By its terms, a charter exists for a
specified term and then expires.
The ultimate decision under Section 515(f) whether to revoke a charter subject to
revocation, much like the decision under Section 514A(b) whether to renew a charter
whose term is about to expire, is within the discretion of the Department. Thus, just as in
Reach Academy, where Chief Judge Stark concluded that the plaintiffs did not have a
constitutionally protected interest in a charter because the Department had discretion
under Section 514A(b) to decide whether or not to renew a charter, 144 I conclude that
New Moyer does not have a constitutionally protected property interest in its charter
because the Department has the discretion under Section 515(f) to decide whether or not
to revoke the charter.
143
Reach Academy, 2014 WL 2445804, at *7. Reach Academy, like this case, involved a
preliminary injunction motion and a motion to dismiss for failure to state a claim.
144
See id.
37
This conclusion also is consistent with the substantial authority cited by
Defendants finding there to be no constitutionally protected interest in a charter school,
both in the context of addressing revocation of a charter 145 and non-renewal of a
charter. 146 New Moyer, by contrast, relies solely on Northside Urban Pathways Charter
School v. State Charter School Appeal Board. 147 That case is inapposite.
The key issue before the Northside Urban court was whether a Pennsylvania state
agency had subject matter jurisdiction to hear an appeal of a school district’s decision to
deny a charter school’s charter modification request. 148 Although the court noted that a
145
See, e.g., Project Reflect, Inc. v. Met. Nashville Bd. of Pub. Educ., 947 F. Supp. 2d
868, 878 (M.D. Tenn. 2013) (concluding that a charter school did not have a
constitutionally protected interest in its charter under Tennessee law because the statutory
provision governing charter revocation “uses the language of discretion, not entitlement,
and only minimally conditions that exercise of discretion”); see also Project Sch. v. City
of Indianapolis, 2012 WL 3114573, at *3 (S.D. Ind. July 31, 2012) (concluding that there
was no protected property interest in a charter under Indiana law because “the charter
school statute frames the decision to revoke a charter as a discretionary matter”).
146
Pinnacle Charter Sch. v. Bd. of Regents of the Univ. of N.Y., 969 N.Y.S.2d 318, 320-
21 (N.Y. App. Div. 2013) (“[T]he New York Charter Schools Act . . . creates no
constitutionally protected property interest in the renewal of a charter[.]”); State v.
Williamson, 141 S.W.3d 418, 427-28 (Mo. Ct. App. 2004) (“[J]ust as a prospective
charter school has no protected property interest at stake regarding an initial charter
application, the school also has no protected property interest under the [Missouri]
Charter Schools Act with regard to renewal of its charter.”).
147
56 A.3d 80 (Pa. Commw. 2012).
148
Id. at 84 (citing Foreman v. Chester-Upland School Dist., 941 A.2d 108, 115 (Pa.
Commw. 2008) (concluding, in determining whether a state agency had authority to
modify a charter as a contract, that “the relationship between a school district and a
charter school is not contractual, but regulatory”)).
38
“charter school has a protected property interest in its charter” 149 under the Pennsylvania
Charter School Law, the court did not address the significance of statutory provisions like
those in the Delaware Charter School Act, discussed above, which expressly afford the
approving authority the discretion to decide whether or not to renew or revoke a charter.
b. The Individual Plaintiffs Have No Protected Property
Interest
The Individual Plaintiffs contend they have a protected property interest in New
Moyer’s charter under the Due Process Clause because Delaware law “grants an express
entitlement to the students of choice schools to graduate from their school of choice.” 150
In support, the Individual Plaintiffs rely exclusively on their interpretation of Section
407(a)(1) of the Choice Program, which provides that “a pupil accepted for enrollment”
in a choice school “shall be entitled to remain enrolled therein until graduation from the
school.” 151 Based solely on this statute, the Individual Plaintiffs contend that the State
must provide (and has failed to provide) appropriate procedural due process before
depriving them of their property interest in graduating from New Moyer. 152
Defendants, in opposition, contend that the Individual Plaintiffs do not have a
legally protected property interest in New Moyer’s charter because Delaware students do
not have a State-created right to graduate from a particular school. Specifically,
149
Id.
150
Pls.’ Op. Br. 47.
151
14 Del. C. § 407(a)(1).
152
Pls.’ Reply Br. 15-17; Pls.’ Op. Br. 47-48.
39
Defendants argue that the Individual Plaintiffs’ proffered interpretation of Section
407(a)(1) of the Choice Program directly conflicts with the plain language of Section
516(2) of the Charter School Act, which permits the Department to revoke New Moyer’s
charter, and thereby close the school, if it fails to comply with its obligations under its
charter. 153 Read together, according to Defendants, Section 407(a)(1) “generally allows a
student to remain enrolled until graduation at a school that remains open and
operational,” while Section 516(2) “applies to the determination of whether a charter
school remains in compliance with statutory requirements and its charter.” 154 I agree.
In my opinion, Section 407(a)(1) of the Choice Program does not provide
Delaware students a legitimate claim of entitlement to graduate from a school at which
they are enrolled. 155 The Choice Program, particularly Section 407, is a student-centered
statute. Section 407(a)(1) provides, in relevant part:
153
Defs.’ MTD Op. Br. 26-27.
154
Id. 28.
155
My analysis of the meaning of Section 407 is guided by familiar principles of
statutory interpretation:
In interpreting a statute, Delaware courts must ascertain and give effect to
the intent of the legislature. If the statute is found to be clear and
unambiguous, then the plain meaning of the statutory language controls. . . .
[A] statute is ambiguous only if it is reasonably susceptible of different
interpretations, or if a literal reading of the statute would lead to an
unreasonable or absurd result not contemplated by the legislature. . . .
Courts also should ascribe a purpose to the General Assembly’s use of
statutory language, and avoid construing it as surplusage, if reasonably
possible.
In re Krafft-Murphy Co., Inc., 82 A.3d 696, 702 (Del. 2013).
40
(a)(1) A pupil accepted for enrollment in a school or program pursuant to
this chapter shall be entitled to remain enrolled therein until graduation
from the school or completion of the program provided that the pupil
continues to meet the requirements for such school or program[.]
The plain language of Section 407(a)(1) means that, once a choice school accepts a
student for enrollment, that school may terminate the student’s enrollment for only
certain specified reasons. Similarly, Section 407(a)(2), which is not at issue here, limits
the ability of a student accepted for enrollment at a choice school to change his or her
choice school during a two-year period to only certain specified reasons.
Although Section 407(a)(1) is to be construed broadly, 156 a necessary and
fundamental implication of Section 407(a) is that a school must be open for these Choice
Program protections to attach. As Plaintiffs recognized at oral argument, the protections
of Section 407 are available only if, for example, the school is adequately funded. 157 In
the case of New Moyer, this means that the protections of Section 407(a) are available
only if the school has a charter to operate.
Plaintiffs’ interpretation of Section 407 is plainly incorrect in my view because it
would allow the student-centered provision of Section 407 to eviscerate the school-
centered provisions of the Charter School Act and the General Assembly’s express
directive for the Department to oversee public education in the State, which includes the
156
14 Del C. § 401(b) (“It is therefore the intent of the General Assembly that this
chapter be construed broadly to maximize parental choice in obtaining access to
educational opportunities for their children.”).
157
Tr. of Oral Arg. 11-12.
41
authority to revoke and to not renew a charter. Nothing in Section 407 indicates that the
General Assembly intended the statute to have this effect.
In light of the distinct subject matters addressed by the Choice Program and the
Charter School Act, both of which were adopted by the General Assembly on July 10,
1995, I conclude that Section 407(a)(1) was not intended to create a legitimate claim of
entitlement that would prevent the Department from exercising its statutory discretion
under Section 515(f) to revoke New Moyer’s charter unless it satisfied the Individual
Plaintiffs’ rights under the Due Process Clause. 158 In short, neither Section 407(a) nor
any other provision of the Delaware Constitution, Delaware statutory law, or Delaware
common law that has been identified endows Delaware students with the right to
graduate from a particular school. 159 Thus, I conclude that the Individual Plaintiffs do
not have a protected property interest in graduating from New Moyer.
158
The fact that, as discussed above, the Department has broad discretion in determining
whether to renew a charter is further legal support for my conclusion that Delaware
students do not have a constitutionally protected interest in attending New Moyer. See
Reach Academy, 2014 WL 2445804, at *7 (“The interest Plaintiffs assert, the renewal of
Reach’s charter, is not an interest protected by the Fourteenth Amendment’s Due Process
Clause.”).
159
Accord Mullen v. Thompson, 31 F. App’x 77, 79 (3d Cir. 2002) (“[Pennsylvania
students] have no constitutionally cognizable property or liberty interest in attending the
individual school of their choice.”); Pocono Mountain Charter School v. Pocono
Mountain School Dist., 442 F. App’x 681, 685 n.5 (3d Cir. 2011) (“[S]tudents do not
have a cognizable liberty or property interest in going to a school of their choice.”).
42
c. Even if New Moyer and the Individual Plaintiffs Had
Protected Property Interests, They Received Due Process
“Only after finding the deprivation of a protected interest [does the Court] look to
see if the State’s procedures comport with due process.” 160 Assuming, for the sake of
argument, that New Moyer had a protected interest in its charter and that the Individual
Plaintiffs had a protected interest in graduating from New Moyer, Plaintiffs have still
failed to show a reasonable probability of success on their procedural due process claims.
Plaintiffs’ procedural due process challenges are straightforward. They contend
that Defendants gave inadequate notice on the Department’s website about the Formal
Review notice. They also contend that Defendants “failed to provide Plaintiffs with
ample opportunity to be heard” by (i) not permitting a reasonable opportunity to
introduce evidence, to examine witnesses, or to make argument; and (ii) holding the
Committee’s public hearing in Dover. 161 In response, Defendants have submitted
evidence disputing Plaintiffs’ contention concerning the website and further assert that
the requirements of the Due Process Clause are flexible such that a trial-like proceeding
was not “required or warranted” to revoke New Moyer’s charter. 162 Thus, Defendants
argue that the statutorily prescribed process they undertook provided “more than ample
notice and an opportunity to be heard” than the Due Process Clause requires. 163
160
Sullivan, 526 U.S. at 59.
161
Pls.’ Op. Br. 52.
162
Defs.’ Ans. Br. 50.
163
Id.
43
“The essence of due process is the requirement that ‘a person in jeopardy of
serious loss (be given) notice of the case against him and opportunity to meet it.’” 164
“The opportunity to present reasons, either in person or in writing, why proposed action
should not be taken is a fundamental due process requirement.” 165 In Mathews v.
Eldridge, the United States Supreme Court set forth several factors that a court must
balance in determining the procedural process due in a given situation:
First, the private interest that will be affected by the official action; second,
the risk of an erroneous deprivation of such interest through the procedures
used, and the probable value, if any, of additional or substitute procedural
safeguards; and finally, the Government’s interest, including the function
involved and the fiscal and administrative burdens that the additional or
substitute procedural requirement would entail. 166
The Mathews test, as the Supreme Court has repeatedly recognized, is one of
“flexibility.” 167
164
Mathews v. Eldridge, 424 U.S. 319, 348 (1976) (citation omitted).
165
Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 546 (1985).
166
Mathews, 424 U.S. at 335.
167
Heller v. Doe, 509 U.S. 312, 332 (1993) (quoting Greenholtz v. Inmates of Neb. Penal
& Corr. Complex, 442 U.S. 1, 13 (1979)).
Plaintiffs contend that “procedural due process can also be offended when
governmental action violates protected rights in an arbitrary and capricious manner.”
Pls.’ Reply Br. 27. They cite two cases for support: (i) Ridings v. Unemployment
Insurance Appeal Board, 407 A.2d 238 (Del. Super. 1979), in which the plaintiff alleged
a lack of procedural due process because he could not testify in support of his claim
before the state unemployment benefits board; and (ii) Chung v. Park, 514 F.2d 382, 387
(3d Cir. 1975), in which a terminated college professor challenged, on due process
grounds, the procedures imposed at a pre-termination hearing before an arbitration panel.
In my opinion, when the quotations cited by Plaintiffs from Ridings and Chung are
analyzed in context, they are not persuasive support for Plaintiffs’ argument. In any
44
In my opinion, Plaintiffs received adequate due process of the Department’s
decision to revoke New Moyer’s charter. It is undisputed that New Moyer received the
Formal Review notice and Defendants have submitted an affidavit, which I credit,
attesting that the notice was available on the Department’s website from July 18, 2014
(the day after the Formal Notice was issued) until November 7, 2014, by which time the
revocation decision had been made and announced publicly. 168 No evidence has been
submitted that anyone who wished to attend the Committee’s hearing on August 5, its
meeting on August 29, or the State Board and Department’s joint hearing on September
10 was unaware of the opportunity to do so, or that the statutorily required notice of those
hearings was not provided. 169
The record further reflects that Defendants followed the process required by the
Charter School Act 170 before revoking New Moyer’s charter, including:
• On July 17, 2014, providing the Formal Review notice to New Moyer;
• Appointing the Committee to conduct a review;
• On August 5, 2014, holding a meeting between the Committee and New Moyer to
discuss the areas of concern identified in the Formal Review notice;
event, Plaintiffs’ contention is inconsistent with the United States Supreme Court’s more
recent precedents cited above, including Mathews and its progeny, which focus the
procedural due process inquiry on the provision of notice and an opportunity to be heard.
168
See supra note 93.
169
See 29 Del. C. § 10004(e).
170
14 Del. C. §§ 515(b)-(d).
45
• On August 5, 2014, holding a public hearing in Dover before the Committee
issued its Initial Report;
• Providing New Moyer the opportunity to review and comment on the Committee’s
Initial Report by August 22, 2014;
• On August 29, 2014, holding a public meeting in Dover to discuss the
Committee’s Initial Report and New Moyer’s response;
• Providing New Moyer the opportunity to review and comment on the Committee’s
Final Report by September 15, 2014; and
• On September 10, 2014, holding a joint public hearing of the Department and the
State Board in Wilmington to discuss the Committee’s Final Report.
In sum, throughout this process, New Moyer was given adequate notice and a meaningful
opportunity to be heard before the Department revoked its charter. In fact, numerous
New Moyer representatives attended Committee meetings and the public hearings, and
New Moyer submitted a written response to the Committee’s Initial Report. New
Moyer’s decision not to respond in writing to the Committee’s Final Report does not
change the fact that New Moyer had a meaningful opportunity to do so.
Given the respective interests of Plaintiffs and Defendants under the Mathews test,
the Due Process Clause did not require, in my view, that Plaintiffs have the opportunity
to formally introduce evidence, 171 to examine witnesses, or to make argument at a trial-
like proceeding. In my opinion, those additional procedures are not warranted given the
procedures already in place under the Charter School Act, and any arguable benefit
derived from them would be outweighed by the significant fiscal, administrative, and
171
As discussed above, Plaintiffs were afforded the opportunity to submit written
comments to the Committee and did so on at least one occasion.
46
logistical burdens of imposing such requirements on the approving authority whenever it
is necessary to determine whether any of the over 30 charter schools in Delaware 172 is
violating the terms of its charter and whether remedial measures should be ordered—a
process that is to be completed within 60 working days. 173
Finally, I am not persuaded that Defendants acted unconstitutionally by holding
the Committee’s public meetings and a public hearing in Dover, where the main office of
the Department is located, as opposed to Wilmington. Plaintiffs do not suggest the
Committee was legally required to meet in Wilmington, and they have not offered any
evidence that Defendants’ decision to hold those hearings in the State capital was out of
the ordinary for that type of proceeding. The final public hearing held by the Department
and the State Board on September 10, moreover, was held in Wilmington.
For the reasons explained above, even assuming arguendo that New Moyer had a
protected interest in its charter and/or that the Individual Plaintiffs had a protected
interest in graduating from New Moyer, Plaintiffs have failed to demonstrate a reasonable
probability of success on the merits of their procedural due process claims.
172
I take judicial notice of the number of charter schools currently operating in Delaware
because this fact is not subject to reasonable dispute. See About Us, Delaware Charter
Schools Network, available at http://decharternetwork.org/About-Us. D.R.E. 201(b).
173
14 Del. C. § 515(c).
47
d. Plaintiffs Have Failed to Show a Reasonable Probability
of Demonstrating that Defendants Violated the Charter
School Act Procedures
Plaintiffs argue that the Department failed to comply with the Charter School Act
in two respects when it revoked New Moyer’s charter: (i) by not revoking New Moyer’s
charter effective immediately as opposed to making the revocation effective at the end of
the 2014-15 school year; and (ii) by sending the Secretary’s letter formally revoking New
Moyer’s charter 61 days after the Formal Review notice, which is one day after the 60-
working-day deadline in Section 515(b). 174 Plaintiffs contend that these alleged
violations deprived Plaintiffs of a protected interest in violation of the Due Process
Clause. 175 Assuming, without deciding, that Plaintiffs’ legal theory is viable, Plaintiffs
are unlikely to succeed on the merits of either claim in my view.
As to the first claim, Section 515(f) provides that the Department “may revoke the
charter and manage the school directly until alternative arrangements can be made for
students at the school or place the school on a probationary status.” 176 Although this
language implies that the Department may revoke a charter immediately, nothing in the
statute expressly addresses when a revocation decision must become effective. Nor does
the statute expressly prohibit the Department from making a revocation effective at a
future date. In another context, the General Assembly’s use of the word “may” has been
174
Pls.’ Reply Br. 20; Pls.’ Op. Br. 50-51.
175
Pls.’ Reply Br. 17-18 n.10.
176
14 Del. C. § 515(f).
48
interpreted to mean “a permissive approach that authorizes [action] by the means
specified, but not ruling out [action] by other means.” 177 In my opinion, interpreting
Section 515(f) in this manner is consistent with the apparent intent of the statute to
facilitate an orderly transition for the students when the Department decides to revoke a
charter. 178 Thus, I conclude that, under Section 515(f), the Department has the discretion,
which it exercised with respect to New Moyer’s charter, to revoke a charter effective at a
future date. 179
As to the second claim, assuming that Plaintiffs’ interpretation of the 60-working
day requirement is correct, 180 which I need not decide, a one-day violation of the 60-
177
See, e.g., Biolase, Inc. v. Oracle P’rs, L.P., 97 A.3d 1029, 1033-34 (Del. 2014)
(concluding that it was “sensible and reasonable” to interpret 8 Del. C. § 141(b), which
provides that a director “may resign . . . upon notice given in writing,” to not preclude a
director from resigning orally).
178
See also 14 Del. C. § 515(i) (“In the event of a charter school closure for any reason,
the approving authority shall oversee and work with the closing school to ensure a
smooth and orderly closure and transition for students, parents and employees, as guided
by the closure protocol.”).
179
Plaintiffs’ Section 515(f) challenge is curious. Given that Plaintiffs are seeking to
preserve the ability of the current Board to oversee the management of New Moyer until
the end of the 2015-16 school year, it is surprising that they would object to the current
management structure not being displaced immediately.
180
None of the parties submitted any legal authority interpreting the 60-working day
requirement in Section 515(c). Defendants contend that, although the Secretary did not
send his letter notifying New Moyer of the decision to revoke its charter until 61 working
days after the Formal Review notice was issued, the decision had been publicly
announced, and thus was “issued” within the meaning of Section 505(c), at the public
hearing held on October 9, 2014, which was within the required 60-working day period.
Defs.’ Ans. Br. 53. There is also a legitimate argument that the 60-working-day
requirement is merely directory rather than truly mandatory. See, e.g., Bartley v. Davis,
519 A.2d 662, 667 (Del. 1986) (“There is no universal standard or test for determining
49
working day deadline in Section 515(c) is hyper-technical and does not amount to a
constitutional violation of due process. Plaintiffs have not shown any prejudice from the
one-day delay, let alone prejudice that, without more, would constitute a violation of the
Due Process Clause.
2. Substantive Due Process Claim
As Plaintiffs acknowledged at oral argument, the thrust of their application for a
preliminary injunction is predicated on their procedural due process claims addressed
above. Insofar as Plaintiffs raised substantive due process claims in their briefs, they can
be addressed in short order.
Under the Third Circuit’s decision in Nicholas v. Pennsylvania State University, 181
which cites extensive supporting authority and which I find to be persuasive here, the
protections of substantive due process attach only where a plaintiff has demonstrated
deprivation of an interest that is considered a “fundamental” right under the United States
Constitution. 182 Defendants contend that any protected interest of Plaintiffs, if it exists,
whether a statute is directory or mandatory. . . . The question is, what did the legislature
intend that the consequences of noncompliance with the statutory command be?”).
181
227 F.3d 133 (3d Cir. 2000).
182
Id. at 140 (citing, inter alia, Nilson v. Layton City, 45 F.3d 369, 372 (10th Cir. 1995);
McKinney v. Pate, 20 F.3d 1550, 1556 (11th Cir. 1994) (en banc); Sutton v. Cleveland
Bd. of Educ., 958 F.2d 1339, 1351 (6th Cir. 1992); Huang v. Bd. of Governors of Univ. of
N.C., 902 F.2d 1134, 1142 n. 10 (4th Cir. 1990)) (“[W]e believe that a careful review of
the case law does reveal one guiding principle: whether a certain property interest
embodies this ‘particular quality’ is not determined by reference to state law, but rather
depends on whether that interest is ‘fundamental’ under the United States Constitution.”).
50
“does not rise to the level of a ‘fundamental’ right.” 183 I agree.
Plaintiffs have cited no federal or state authority in which a court has held that
students have a fundamental right under the Constitution to attend a particular school or
that a charter school has a fundamental right under the Constitution to remain open. In
the absence of any such authority, and in light of the United States Supreme Court’s
directive that a court should “exercise the utmost care” when asked to “break new
ground” in the jurisprudence of substantive due process, 184 I decline to find that any
supposed protected interest Plaintiffs have advanced constitutes a “fundamental” right. 185
This conclusion logically follows from my prior conclusion, for the reasons
explained above, that neither the Individual Plaintiffs nor New Moyer have established
the existence of a protected property interest regarding New Moyer’s charter under the
Due Process Clause for purpose of invoking the protections of procedural due process.
Thus, I decline Plaintiffs’ request to second-guess the substantive merits of the
183
Defs.’ MTD Op. Br. 51.
184
Collins v. City of Harker Heights, Tex., 503 U.S. 115, 125 (1992) (“[T]he Court has
always been reluctant to expand the concept of substantive due process because
guideposts for responsible decisionmaking in this unchartered area are scarce and open-
ended.”).
185
“The mere novelty of such a claim is reason enough to doubt that ‘substantive due
process’ sustains it; the alleged right certainly cannot be considered ‘so rooted in the
traditions and conscience of our people as to be ranked as fundamental.’” Reno v. Flores,
507 U.S. 292, 303 (1993) (citations omitted).
51
Department’s decision to revoke New Moyer’s charter through the prism of a substantive
due process analysis. 186
3. The Lack of Judicial Review Claim
Plaintiffs assert that the Charter School Act violates their rights to due process
under the Constitution insofar as it “purports to preclude judicial review of the decision”
of the Department to revoke New Moyer’s charter. 187 Defendants respond that the
Charter School Act properly precludes a direct appeal, but that a limited right of appeal is
available in the form of certiorari review in the Superior Court (but not in the Court of
Chancery), which Plaintiffs failed to pursue. 188 For the reasons discussed below, I find
186
Plaintiffs made essentially three contentions in support of their substantive due
process claim: (i) the Committee purportedly did not consider material facts in its Final
Report, such as the role of K12 in New Moyer’s academic performance; (ii) the
Department purportedly treated New Moyer differently than other charter schools with
similar academic performance issues; and (iii) the Department purportedly failed to
consider New Moyer’s request to implement the SpringBoard curriculum before revoking
its charter. Pls.’ Op. Br. 54-58. Were one to engage in a substantive due process
analysis, the standard of review that would apply to the Department’s revocation of New
Moyer’s charter, as non-legislative action, is “shocks the conscience,” which
encompasses “only the most egregious conduct.” Cnty. of Sacramento v. Lewis, 523 U.S.
833, 846 (1998); United Artists Theatre Circuit, Inc. v. Twp. of Warrington, PA, 316 F.3d
392, 399-400 (3d Cir. 2003) (“[E]xecutive action violates substantive due process only
when it shocks the conscience but that the meaning of this standard varies depending on
the factual context.”). Without engaging in a point-by-point review of the merits, the
Department’s ultimate decision to revoke New Moyer’s charter instead of placing New
Moyer on probation does not shock the conscience, in my view, given that New Moyer
indisputably was the lowest performing charter school in the State during the 2013-14
academic year based on the State’s testing standards, and given that its academic
performance had declined markedly from the prior year.
187
Pls.’ Op. Br. 58.
188
Defs.’ Ans. Br. 56. On December 30, 2014, the same day their reply brief on the
present motion was due, Plaintiffs moved to amend the Consolidated Complaint to add a
52
(1) that the Charter School Act implies that a charter school may challenge whether the
Department’s decision to revoke a charter was made “after the exercise of due diligence
and good faith” but may not challenge the merits of a decision to revoke a charter, and (2)
that evidence Plaintiffs have presented fails to demonstrate that it is reasonably probable
the Department did not exercise due diligence or act in good faith in this case.
The Charter School Act provides that the availability of appellate review of the
approving authority’s decision to revoke a charter depends on the identity of the
approving authority. Under Section 515(g), if a local school district decides to revoke a
charter it granted, the charter school may pursue in arbitration a claim to demonstrate
why that decision was in error:
[i]f a local school district which is an approving authority decides to revoke
the school’s charter or place the school on probationary status, the applicant
may file for arbitration in writing with the American Arbitration
Association in Philadelphia within 20 days of the local board’s decision
stating the reasons why it believes the local board decision was in error. . . .
The arbitrator shall convene a hearing and determine whether the local
board’s decision was in error. . . . The arbitrator’s decision shall be final
and binding upon the parties.
By contrast, under Section 515(h), “[i]f the approving authority is the Department and it
decides to revoke the school’s charter or place the school on probationary status, its
cause of action for review by writ of certiorari. Defendants filed an opposition to that
motion on December 31, 2014, which raises significant issues concerning whether the
Court of Chancery has subject matter jurisdiction over such a claim. See Maddrey v.
Justice of Peace Court 13, 956 A.2d 1204, 1207 (Del. 2008) (“[T]he Superior Court has
original and exclusive jurisdiction among trial courts under the Delaware Constitution to
issue common law writs of certiorari to inferior tribunals[.]”). Because Plaintiffs did not
fairly present a claim for certiorari review in connection with their application for a
preliminary injunction, I do not consider this issue in resolving the present motion.
53
decision shall be final and not subject to arbitration or judicial review.” 189 This provision
plainly evidences the General Assembly’s intention that the merits of a decision to revoke
a charter (i.e., whether that “decision was in error”) shall not be subject to judicial review
when that decision is made by the Department.
On the other hand, Section 516 of the Charter School Act, which enumerates the
two reasons for which a charter may be revoked, expressly provides that the charter
“shall be subject to revocation or probation, after the exercise of due diligence and good
faith[.]” 190 By necessary implication, this provision contemplates that a charter school
may seek judicial review to challenge whether the approving authority complied with the
“due diligence and good faith” standard in determining that one of the reasons for
revocation has been satisfied. 191 If this were not the case, the inclusion of the “due
189
I note that Section 515(h) does not preclude Plaintiffs from asserting their Due Process
Clause claims by operation of the Supremacy Clause of the United States Constitution.
190
14 Del. C. § 516 (emphasis added).
191
The procedures governing the oversight and revocation process outlined in Section
515 of the Charter School Act afford the “applicant” or the “school” certain rights to
receive notice and the opportunity to review and comment on the Committee’s initial
report as well as to respond to the Committee’s final report. See 14 Del. C. §§ 515(b)-
(d). The statute also affords the “applicant” the right to arbitrate a revocation decision by
a local school district. Id. § 515(g). Based on these provisions, I find that the right of
review implied in Section 516 extends to New Moyer but does not extend to the
Individual Plaintiffs. For the avoidance of doubt, as I noted at the outset of my legal
analysis, I have not addressed in this opinion whether New Moyer has standing.
54
diligence and good faith” language in Section 516 would be rendered meaningless
because no check would exist to ensure the standard was satisfied. 192
In briefing the present motion, the parties provided no authorities concerning the
meaning of “due diligence and good faith.” The Court’s research shows that this specific
standard appears in only two provisions of the entire Delaware Code: Sections 512 and
516 of the Charter School Act, neither of which defines either “due diligence” or “good
faith.”
Absent a definition in the Charter School Act, I must look elsewhere to determine
the plain meaning of “due diligence and good faith.” “Because dictionaries are routine
reference sources that reasonable persons use to determine the ordinary meaning of
words, [Delaware courts] often rely on them for assistance in determining the plain
meaning of undefined terms.” 193 Black’s Law Dictionary defines “due diligence” as
“[t]he diligence reasonably expected from, and ordinarily exercised by, a person who
seeks to satisfy a legal requirement or to discharge an obligation,” and it further defines
“diligence” as “[a] continual effort to accomplish something” and “[c]are; caution; the
attention and care required from a person in a given situation.” 194 These definitions are
192
“[W]ords in a statute should not be construed as surplusage if there is a reasonable
construction which will give them meaning[.]” Oceanport Indus., Inc. v. Wilmington
Stevedores, Inc., 636 A.2d 892, 900 (Del. 1994).
193
Freeman v. X-Ray Assocs., P.A., 3 A.3d 224, 227-28 (Del. 2010); see also Ingram v.
Thorpe, 747 A.2d 545, 548 (Del. 2000) (“Dictionary definitions of undefined terms can
be useful in construing statutes[.]”).
194
Black’s Law Dictionary at 488 (8th ed. 2004).
55
generally consistent with how the term “due diligence” is construed in the Delaware
Uniform Commercial Code, 195 and they also are captured well in the familiar concept of
the duty of care in Delaware corporate law. 196 Black’s Law Dictionary also defines
“good faith” as “[a] state of mind consisting in (1) honesty in belief or purpose, (2)
faithfulness to one’s duty or obligation, (3) observance of reasonable commercial
standards of fair dealing in a given trade or business, or (4) absence of intent to defraud
or to seek unconscionable advantage.” 197 This definition is a functional analogue of the
Delaware corporate law concept of good faith. 198
Applying these concepts here, I conclude that the evidence of record is insufficient
to demonstrate that it is reasonably probable New Moyer could prove successfully at trial
that the Department did not exercise due diligence and good faith when it determined that
New Moyer failed to comply with its charter and to satisfy, in its operation of the school,
195
See 6 Del. C. § 1-202 (“An organization exercises due diligence if it maintains
reasonable routines for communicating significant information . . . and there is reasonable
compliance with the routines.”).
196
See, e.g., Aronson v. Lewis, 473 A.2d 805, 812 (Del. 1984) (“[D]irectors have a duty
to inform themselves, prior to making a business decision, of all material information
reasonably available to them.”).
197
Black’s Law Dictionary at 713 (8th ed. 2004).
198
See, e.g., In re Walt Disney Co. Deriv. Litig., 906 A.2d 27, 67 (Del. 2006) (“A failure
to act in good faith may be shown, for instance, where the fiduciary intentionally acts
with a purpose other than that of advancing the best interests of the corporation, where
the fiduciary acts with the intent to violate applicable positive law, or where the fiduciary
intentionally fails to act in the face of a known duty to act, demonstrating a conscious
disregard for his duties.”).
56
criteria set forth in Section 512 of the Charter School Act. 199 In my opinion, the record
demonstrates that the Department properly exercised due diligence in finding that New
Moyer’s charter was subject to revocation for many of the same reasons, discussed
above, that demonstrate that the Plaintiffs were afforded appropriate due process. In
particular, the record shows that the Department actively sought to avail itself of all
material information reasonably available to it, including through the statutory process
that required public meetings and hearings and that permitted New Moyer to submit
written responses.
Regarding the Department’s good faith, there is no persuasive evidence in the
record to suggest that the Department acted with an improper motive, 200 with an intention
to violate Delaware law, or in conscious disregard of the Charter School Act. Indeed, of
199
Plaintiffs referenced the due diligence and good faith standard in their papers for the
purpose of arguing that Defendants’ conduct was arbitrary and capricious, see Pls.’ Op.
Br. 52, but they did not argue specifically that this standard was not met. Nonetheless, in
the interest of completeness, I consider whether the evidence of record is sufficient to
demonstrate a reasonable probability of success on such a claim.
200
In my opinion, the overwhelming weight of the evidence in the preliminary record
disproves Plaintiffs’ speculation that Defendants wanted to shut down New Moyer for
any reason other than those first listed in the Secretary’s Formal Review letter, all of
which are grounds for revocation under Section 512 of the Charter School Act. Rather,
the evidence shows that Defendants repeatedly sought in good faith to help New Moyer
comply with the Charter School Act. For example, when the Department first discovered
that New Moyer was in violation of its charter during its first year by using a different
instruction method than that specified in its charter, the Department worked with New
Moyer to modify its charter, rather than take other remedial action. Similarly, it was the
Department that first suggested the SpringBoard curriculum to New Moyer, which
undermines Plaintiffs’ contention that Defendants were wedded to the use of K12 at New
Moyer. The inability of New Moyer to obtain Department approval to modify its charter
or to use the SpringBoard curriculum was not the product of any ulterior or improper
motives of Defendants.
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the seven areas of potential violations identified in the Secretary’s Formal Review notice,
only four areas formed the basis of the Department’s decision to revoke New Moyer’s
charter. This reflects a good faith effort by Defendants to determine whether New Moyer
was in violation of its charter and/or applicable law, and, if so, whether remedial
measures were appropriate.
*****
Because Plaintiffs have failed to demonstrate a reasonable probability of success
on the merits of any of the claims they have advanced on this motion, Plaintiffs have not
satisfied the standard to earn a preliminary injunction. I thus need not address the
elements of irreparable injury or the balance of the equities. 201
IV. CONCLUSION
For the foregoing reasons, Plaintiffs’ motion for a preliminary injunction is
DENIED.
IT IS SO ORDERED.
201
See Cantor Fitzgerald, 724 A.2d at 579.
58