United States District Court, D. Maine
ORDER ON MOTION FOR SUMMARY JUDMENT
A. WOODCOCK, JR. UNITED STATES DISTRICT JUDGE
Court denies an educational institute's motion for
summary judgment against the claims of two of its graduates,
who allege that the institute failed to provide them with an
adequate education, changed the school calendar and the
school location, causing them to incur unanticipated expenses
and lost income, and refused to provide their school
transcripts to others, causing them to lose educational and
employment opportunities. The Court concludes that there are
genuine issues of material fact that preclude summary
judgment. The Court also rejects the educational
institute's position that the Plaintiffs' claims do
not meet the $75, 000 jurisdictional requirement for
April 6, 2016, Maria Perez-Webber and Jossie Reynoso, former
students at the Nursing Program at InterCoast Career
Institute (InterCoast), filed this civil action claiming that
InterCoast failed to provide them the quality of nursing
education it advertised. Compl. (ECF No. 1). The
Plaintiffs alleged breach of contract, negligent
misrepresentation, and fraud. Id. On May 4, 2016,
InterCoast moved to dismiss the complaint and for a more
definite statement. Def.'s Mot. to Dismiss Compl.
and/or Mot. for a Mo[re] Definite Statement (ECF No. 7).
On October 31, 2016, the Court denied the motion to dismiss.
Order on Mots. to Dismiss and for More Definite
Statement (ECF No. 10).
completion of discovery, InterCoast filed a motion for
summary judgment on January 22, 2018 together with a
statement of undisputed material facts. Def. InterCoast
Career Institute's Mot. for Summ. J. (ECF No. 60)
(Def.'s Mot.); Def.'s Statement of
Undisputed Material Facts in Supp. of Def.'s Mot. for
Summ. J. (ECF No. 61) (DSMF). The Plaintiffs filed their
opposition on February 22, 2018 with a response to
InterCoast's statement of material facts and their own
statement of facts. Pls.' Opp'n to Def.'s
Mot. for Summ. J. (ECF No. 63) (Pls.'
Opp'n); Pls.' Resp. to Def.'s Statement
of Material Fact (ECF No. 64) (PRDSMF); Pls.'
Statement of Material Facts (ECF No. 65) (PSAMF). On
March 8, 2018, InterCoast replied to the Plaintiffs'
opposition and to their statement of material facts. Def.
InterCoast Career Institute's Mem. in Supp. of Mot. for
Summ. J. (ECF No. 66); Def.'s Resp. to Pl.'s
Statement of Material Facts (ECF No. 67) (DRPSAMF).
may grant summary judgment under Federal Rule of Civil
Procedure 56 if the record demonstrates that “there is
no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P.
56(a). “A ‘material' fact is a
‘contested fact [that] has the potential to change the
outcome of the suit under the governing law if the dispute
over it is resolved favorably to the nonmovant, ' and a
‘genuine issue' means that ‘the evidence
about the fact is such that a reasonable jury could resolve
the point in favor of the nonmoving party.'”
McCarthy v. City of Newburyport, 252 Fed.Appx. 328,
332 (1st Cir. 2007) (quoting Navarro v. Pfizer
Corp., 261 F.3d 90, 93-94 (1st Cir. 2001)) (internal
quotation marks and citation omitted).
Court must examine the record evidence “in the light
most favorable to [the nonmovant], and [must draw] all
reasonable inferences in . . . favor [of the nonmoving
party].” Foley v. Town of Randolf, 598 F.3d 1,
5 (1st Cir. 2010). At the same time, courts ignore
“conclusory allegations, improbable inferences, and
unsupported speculation.” Cortés-Rivera v.
Dep't of Corr. & Rehab. of Commonwealth of P.R.,
626 F.3d 21, 26 (1st Cir. 2010) (quoting Sullivan v. City
of Springfield, 561 F.3d 7, 14 (1st Cir. 2009)).
STATEMENT OF FACTS
is a private, for-profit California corporation which
previously operated a private, for-profit Vocational Nursing
Program in Kittery, Maine, with the first class starting in
about May 2011 until May 2015. DSMF ¶ 1; PRDSMF ¶
1. InterCoast also operated a private, for-profit Vocational
Nursing Program in South Portland, Maine from approximately
October 2007 to March 2016. Id. Maria Perez-Webber
and Jossie Reynoso both attended the Practical Nursing
Program commencing on or about May 27, 2014 until they both
graduated on or about September 4, 2015. DSMF ¶ 2;
PRDSMF ¶ 2. Ms. Perez-Webber and Ms. Reynoso applied to
and enrolled at InterCoast based on its representations that
its nursing program was an accredited professional work-like
atmosphere with mature competent professionals to teach
students the skills needed to become nurses. PSAMF ¶ 2;
DRPSAMF ¶ 2. In exchange for InterCoast's
representations, Mses. Perez-Webber and Reynoso each paid
InterCoast $37, 000 in tuition. PSAMF ¶ 3; DRPSAMF ¶ 3.
Perez-Webber and Ms. Reynoso began taking classes in 2014 at
InterCoast's Kittery location. PSAMF ¶ 1; DRPSMAF
¶ 1. The program consisted of four terms. DSMF ¶ 3;
PRDSMF ¶ 3. After the Kittery campus shut down, the
Plaintiffs were forced to complete their coursework from the
South Portland campus, which was an additional burden to
them. DSMF ¶ 4; PRDSMF ¶ 4. InterCoast
utterly failed to provide Plaintiffs with the education,
training, and facilities that it had advertised and that were
required by the State Board of Nursing. PSAMF ¶ 4;
DRPSAMF ¶ 4. In fact, the state of Maine Board of
Nursing placed InterCoast on probation and eventually revoked
its license because the Practical Nursing Program did not
meet minimal requirements, a decision that caused InterCoast
to close its nursing program in 2016. PSAMF ¶ 5; DRPSAMF
Perez-Webber and Jossie Reynoso both signed the same
enrollment forms with InterCoast. DSMF ¶ 4; PRDSMF ¶
4. True and correct copies of the InterCoast enrollment forms
signed by both Plaintiffs are attached to the declaration of
Geeta Brown, corporate president of InterCoast. DSMF
¶¶ 5-6 (citing Aff. of Geeta A. Brown
in Supp. of Def.'s Mot. for Summ. J. Attachs. 1-2
InterCoast Career Institute Enrollment
Agreements); PRDSMF ¶¶ 5-6. Both enrollment
forms have an estimated completion date of August 14, 2015
for Ms. Perez-Webber and Ms. Reynoso. DSMF ¶ 7; PRDSMF
¶ 7. Each enrollment form contained the following
The School has the right, at its discretion, to make
reasonable changes in program content, materials, schedules,
sequences of courses in programs, or locations in the
interest of improving the student's education, or where
deemed necessary due to industry changes, academic
scheduling, or professional requirements.
Id. Both Plaintiffs inserted their initials at
the bottom of page four of the enrollment forms, a few inches
from the paragraph quoted above, and both Plaintiffs signed
the enrollment forms on page six. DSMF ¶ 8; PRDSMF ¶
the time the Plaintiffs were attending the Practical Nursing
Program, InterCoast decided to give all students a one-week
break between terms. DSMF ¶ 9; PRDSMF ¶ 9. In part
as a result of the one-week break change, the graduation date
for the Plaintiffs was delayed by three weeks. DSMF ¶
10; PRDSMF ¶ 10.
Plaintiffs initialed an “Enrollment Certification
Form.” DSMF ¶ 12; PRDSMF ¶ 12. True
and correct copies of the signed and initialed enrollment
certification forms for the Plaintiffs are attached to Ms.
Brown's declaration. DSMF ¶ 13 (citing Aff. of
Geeta A. Brown in Supp. of Def.'s Mot. for Summ. J.
Attachs. 3-4 InterCoast Colleges/InterCoast Career
Institute Practical Nursing Program Enrollment
Certification Forms); PRDSMF ¶ 13. Page two of the
enrollment certification form states in part:
I understand that I must satisfactorily complete my course of
study, return all library and/or loan textbooks, complete an
exit interview, and pay all tuition charges in full to the
institution prior to receiving my diploma, certificate, or
DSMF ¶ 14; PRDSMF ¶ 14. The Plaintiffs initialed
the paragraph of the enrollment certification form containing
this statement. The enrollment agreements also state:
In order to graduate, students must:
6. Fulfill all financial obligations to the College prior to
graduation unless previous satisfactory arrangements have
been made in writing.
7. Attend the exit interview sessions with Student Services,
Career Services, and Financial Aid. If satisfactory financial
arrangements have not been made, the graduation certificate
or diploma will be withheld.
DSMF ¶ 15; PRDSMF ¶ 15.
Jossie Reynoso graduated from InterCoast's Practical
Nursing Program, she requested that InterCoast forward her
transcripts to the State Nursing Board in late 2015 so that
she could take the State Nursing Exam, called the NCLEX-PN
exam, and InterCoast complied with that request because
satisfactory financial arrangements had been made with the
institution. DSMF ¶ 16; PRDSMF ¶ 16. Jossie Reynoso
passed the NCLEX-PN on her first attempt and received her
Practical Nursing License on or about December 17, 2015. DSMF
¶ 17; PRDSMF ¶ 17. Ms. Reynoso planned to begin
nursing school in January 2016 to obtain her Registered
Nurse's license; however, InterCoast initially refused to
release her transcripts, falsely claiming that Ms. Reynoso
had an outstanding balance with InterCoast. PSAMF ¶
6; DRPSAMF ¶ 6. Ms. Reynoso was unable to begin nursing
school, and instead she hired Attorney Loranger to obtain her
transcripts from InterCoast. Id.
January 2016, Attorney Loranger contacted InterCoast's
counsel, Neil Evans, to request release of Ms. Reynoso's
transcript. PSAMF ¶ 7; DRPSAMF ¶ 7.
Attorney Evans, counsel for InterCoast, advised Attorney
Loranger that because Ms. Reynoso owed money to Tuitions
Options, the organization that InterCoast uses to finance
loans, InterCoast would not release any
transcripts. PSAMF ¶ 8; DRPSAMF ¶ 8. Ms.
Reynoso sent Attorney Evans a copy of her statement from
Tuition Options showing that her loan had a zero
balance. PSAMF ¶ 9; DRPSAMF ¶ 9. When
InterCoast continued to refuse to release the transcript, Ms.
Reynoso filed this lawsuit. PSAMF ¶ 10; DRPSAMF
Maria Perez-Webber graduated from InterCoast's Practical
Nursing Program, InterCoast did not forward her transcripts
to the State Board of Nursing in 2015 despite the fact that
Ms. Perez-Webber had met her financial obligations to
InterCoast. DSMF ¶ 18; PRDSMF ¶ 18. In
April 2016, InterCoast forwarded her transcripts to the State
Board of Nursing, and Ms. Perez-Webber took the NCLEX-PN exam
shortly thereafter. DSMF ¶ 19; PRDSMF ¶ 19. Ms.
Perez-Webber passed the NCLEX-PN exam on her first try and
received her Practical Nursing License in or about June 2016.
DSMF ¶ 20; PRDSMF ¶ 20.
lawsuit, Geeta Brown, InterCoast's corporate president,
submitted an affidavit in which she attests that as of late
2015, Ms. Reynoso had made “satisfactory financial
arrangements” with InterCoast. PSAMF ¶ 11; PRDSMF
¶ 11. Other than releasing the transcript to the Nursing
Board, InterCoast has not otherwise released Ms.
Reynoso's transcript because it contends she still owes
it money, and Ms. Reynoso has been unable to apply to a
registered nursing program because she cannot provide her
transcript. PSAMF ¶ 12; DRPSAMF ¶ 12. If
Ms. Reynoso had started nursing school to obtain her RN in
January 2016, she likely would have graduated from nursing
school and obtained her RN in January 2017 and commenced
employment as an RN in March 2017. PSAMF ¶ 13; DRPSAMF
¶ 13. Ms. Reynoso currently earns $29.00 per hour as an
LPN, and based on her research, search of employment ads, and
discussions with RNs, Ms. Reynoso is aware that the average
starting pay for an RN in Massachusetts is $50.00 per
hour. PSAMF ¶ 16; DRPSAMF ¶ 16. As
an LPN, Ms. Reynoso currently earns $21.00 less per hour than
she would if she were an RN. PSAMF ¶ 17; DRPSAMF
¶ 17. Ms. Reynoso often works sixty to seventy hours per
week and she therefore loses approximately $1, 300 per week
in compensation by not being an RN. PSAMF ¶ 18; DRPSAMF
¶ 18. To date, Ms. Reynoso contends that she has lost
approximately $75, 000 due to InterCoast's refusal to
provide her with her transcript. PSAMF ¶ 19; DRPSAMF
Term III, InterCoast closed its Kittery campus due to the
poor facilities at the Kittery campus and forced the
students, including Ms. Perez-Webber, to commute to
InterCoast's South Portland location. PSAMF ¶
20; DRPSAMF ¶ 20. The additional commuting cost Ms.
Perez-Webber about $1, 000. Id.
Perez-Webber took out loans through InterCoast to finance her
education. PSAMF ¶ 21; DRPSAMF ¶ 21. The terms of
the loans allowed her up to thirty-six months to repay
them. Id. After Ms. Perez-Webber
graduated, InterCoast refused to release her transcripts
unless she accelerated payment of the remaining balance on
her loan with a lump-sum payment of several thousand
dollars. PSAMF ¶ 22; DRPSAMF ¶ 22. Ms.
Perez-Webber repeatedly requested that InterCoast release her
transcripts so that she could take her LPN nursing boards;
however, InterCoast refused. PSAMF ¶ 23; DRPSAMF
¶ 23. In April 2016, Ms. Perez-Webber was able to make a
lump-sum payment to pay off the balance of her
loan. PSAMF ¶ 24; DRPSAMF ¶ 24. Ms.
Perez-Webber was able to take her LPN Boards in June of 2016,
which she immediately passed. PSAMF ¶ 25; DRPSAMF
Perez-Webber planned to take the LPN Nursing Boards in
October 2015.PSAMF ¶ 26; DRPSAMF ¶ 26. At
that time, Ms. Perez-Webber was working as a Licensed Nursing
Aid (LNA) earning $16.00 per hour. PSAMF ¶ 27; DRPSAMF
¶ 27. If Ms. Perez-Webber had taken the LPN Boards in
October 2015, she would have received a raise to $23.00 per
hour. PSAMF ¶ 28; DRPSAMF ¶ 28.
InterCoast's refusal to release Ms. Perez-Webber's
transcripts delayed by eight months her ability to take the
LPN Boards and obtain the raise. PSAMF ¶ 29; DRPSAMF
¶ 29. The eight month delay caused Ms. Perez-Webber to
lose at least $13, 000 in income.PSAMF ¶ 30; DRPSAMF
POSITIONS OF THE PARTIES
A. InterCoast's Motion
motion for summary judgment is primarily based on its
contention that the contract between the Plaintiffs and
InterCoast expressly allows InterCoast to do the exact things
about which the Plaintiffs are now complaining, and therefore
the Plaintiffs have no ground to complain. Def.'s
Mot. at 7-10. In InterCoast's view, to the extent
the Plaintiffs complain that InterCoast provided them an
inadequate education, their performance on the state LPN
Board belies their complaint since both Ms. Perez-Webber and
Ms. Reynoso passed the licensing examination the first time
they took it. Id. at 8. Although the Plaintiffs
complain about the one-week break between terms that
InterCoast instituted while they were there, InterCoast
insists that the contract allows it to make such adjustments
to the academic calendar. Id. Similarly, InterCoast
argues that it contractually reserved the right to change
locations, here from Kittery to South Portland. Id.
Finally, InterCoast says that the contract allows it to
withhold transcripts for those students who owe it money and
therefore there ...