$11.3M Payout In Mountain State U. Accreditation Class Action Settlement Approved

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Last week, a three judge panel approved the proposed $11.3 million class action settlement in the class action lawsuit accusing Mountain State University of concealing problems with their accreditation and then leaving students with worthless degrees before closing down.

A class action and flurry of other lawsuits were filed against the nursing school after it lost its accreditation in August of 2012. Mountain State University was warned by the accrediting body to fix problems in 2010 and 2011, including an excessively top down administration, failure to communicate with faculty and students, and failure to make long term plans for the institution. Subsequent investigations revealed that the university president had awarded himself a $1.84 million salary, more than Harvard’s or Yale’s presidents and cited him with excessive use of the school’s private jets.

The University of Charleston will receive $1.5 million from the more than $18.5 million for expenses it incurred related to its takeover of MSU’s campuses following the institution’s closure. Lawyers who represented the students will receive $5.7 million in attorneys’ fees. The University of Charleston will take a loss, according to representatives, but they did not want to stand in the way of a settlement to former Mountain State students.

The remaining $11.3 million is meant for students, but, as of Feb. 20, only 1,071 had submitted claims with the deadline last Sunday. Additionally, students who attended classes on or after May 27, 2008, in nursing or any other health sciences program are still eligible for money from the settlement.

Students from other programs are eligible as well, as long as they didn’t get a national, regional or state accredited degrees from the University of Charleston or Mountain State University before the program closed or before UC’s offer to graduate them under its name ended. Those eligible need to have submitted transcripts and completed claim forms to receive money from the class action settlement by March 1st. Class members, former MSU students, will be awarded money based on how many MSU credits they had that wouldn’t transfer to another school.

Funds should be awarded to class members in between 30 and 45 days according to the attorney representing the class.

A payout from Mountain State’s insurer, United Educators, and the sale of it’s Beckley campus to West Virginia University and Martinsburg campus to Viking Way Holdings, a limited liability company, is funding much of the Mountain State University class action settlement.

Former Mountain State students have been completing their degree with the University of Charleston in Beckley and Martinsburg since Mountain State closed. The University of Charlseton will continue to hold classes until the end of June.

The deadline to file a claim for the Mountain State class action settlement passed on March 1, 2015. More information about the settlement, including court documents, is available at MSUSettlement.com.

The Mountain State University Accreditation Class Action Lawsuit is Dale Burger, et al. v. Mountain State University, Inc., Charles H. Polk and The Mountain State University Board of Trustees, Case No. 12-cv-1293, Circuit Court of Kanawha County, West Virginia.