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Acceptance of PPP Loan Brings Private School Under Title IX Regulations

A U.S. District Court decision from North Carolina may have important implications for private schools throughout the country. Karanik v. Cape Fear Academy, Inc. is the first case in the country to test the question of whether accepting a PPP loan is enough to bring a school within the bounds of Title IX. Private schools usually do not accept government funds, and thus usually are exempt from Title IX oversight. This court held that acceptance of PPP loans is sufficient to do away with that exemption, and that the application of Title IX lasts as long as the loan is outstanding.

This opinion is binding only in eastern North Carolina, but it may be persuasive to other courts throughout the country. If you are a private school that accepted PPP funds, you need to consult with your attorneys about next steps to resolve the loan or implement Title IX. If you do not have a knowledgeable attorney to consult, TED attorneys are experienced in both school law and PPP loans.

CFA received "federal financial assistance" and had to comply with Title IX for the life of its loan. By plausibly alleging that CFA had a PPP loan during the 2020-21 academic year, plaintiffs plausibly alleged the first element of their Title IX claims.

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ausburn_deborah, youth services law, title ix, ppp loans, insights