Credit: Lisa S./Shutterstock.com Credit: Lisa S./Shutterstock.com

 

Whittier Law School on Wednesday became the second law school in the past year to announce plans to shutter, leaving legal education pundits speculating as to if—or, more likely, when—the next school will collapse.

“It’s a big deal,” said Paul Caron, incoming dean of Pepperdine University School of Law who writes about legal education on the Tax Prof Blog.

Whittier’s demise reflects the larger struggle legal education faces as enrollments have fallen and the entry-level legal job market stagnates. Adding to Whittier’s woes is an angry faculty that has taken to the courts to try and stop its closure.

Whittier’s closure likely could be the first of others, because its economic troubles are not unique, Caron said.

“There has been a thought that there might be some university presidents out there not wanting to go first, who feel their law school no longer makes financial sense but were hesitant to pull the plug,” he said.

Whittier, a private school located in Costa Mesa, Calif., claimed the dubious distinction of being the first law school fully accredited by the American Bar Association in at least 20 years to say it will shut down. Officials at the fledgling Indiana Institute of Technology in October said they will discontinue the four-year-old Indiana Tech Law School at the end of this academic year amid low enrollment, bar passage struggles, and a $20 million deficit. Indiana Tech has provisional ABA accreditation.

Another ABA-accredited law school was eliminated from the roster in 2015 when the Hamline University School of Law merged with the nearby William Mitchell College of Law, in St. Paul., to form the Mitchell Hamline School of Law. The move was not treated as a formal school closure by the ABA.

Yet another law school—the Charlotte School of Law—is teetering on the brink of collapse after the U.S. Department of Education decided late last year to stop funneling federally backed student loans to the school due to problematic admissions policies and the enrollment of students who were unlikely to succeed academically and pass the bar exam. The school announced in January that it would not enroll a new class this fall, and its efforts to restore access to federal loans have thus far fallen short.

“I do think we’ll see more schools go this route,” said Kyle McEntee, executive director of Law School Transparency, a non-profit group that advocates for better information for law school consumers. “When a college or university is subsidizing the law school, and the law school is a drain on their finances and reputation, it gives the university permission to pull the plug.”

Unlike Indiana Tech, which had only graduated one class of students when officials decided to close it down, Whittier has a more than 50-year history in Southern California. It was founded in Los Angeles in 1966 as the Beverly College of Law. The school merged with Whittier College in 1975 and obtained full ABA accreditation in 1985. Whittier relocated to Costa Mesa in 1997 in order to expand, as Orange County had no ABA-accredited law schools at the time.

It’s hard to know whether Whittier will spur a wave of law school closures, said David Yellen, former dean of the Loyola University Chicago School of Law and current president of Marist College.

“Clearly there are a number of law schools that are only holding on because their universities are subsidizing them these days,” Yellen said. “Whether universities are wiling to do that very long-term—or whether law schools can realign themselves in a way that at least make them revenue neutral—is a challenging question that will ultimately determine how many future closures there are.”

The decision to close Whittier was likely a confluence of factors, including financial shortfalls, dismal bar pass and graduate employment rates, increased regulatory pressure from the ABA, high student costs, and falling enrollment. Those same factors are bearing down on a number of other low-performing law schools, legal educators said.

New student enrollment at Whittier plummeted 52 percent over the past five years to 132, according to ABA data. The school has already endured several rounds of faculty buyouts over the past decade.

“There is no reason to believe that the number of applicants to law school will increase any time soon—and without a substantial increase in applicants, schools in this situation can do little to improve their prospects,” said Brian Tamanaha, a professor at Washington University in St. Louis School of Law and author of the 2012 book Failing Law Schools.

Tuition at Whittier is a relatively high—$45,350 annually, Caron said, yet only 22 percent of Whittier graduates passed the July 2016 bar exam—the lowest percentage among the state’s 21 ABA-accredited law schools. What’s more, just 21 percent of 2015 graduates had secured fulltime, long-term jobs that require a law degree within 10 months of leaving campus.

“That’s a real toxic combination for students, and I would hope members of the board would focus on that and ask, ‘How are we improving students’ lives?’” Caron said. “When you look at those numbers, it’s hard to make the case that they should stay in business.”

More rigorous oversight from the ABA also likely played a role in the board’s assessment of the school’s viability, McEntee said. The ABA has taken disciplinary action against four law schools since July—an unusually high number for the accreditation organization, which itself is facing pressure from the Education Department for being too lax on schools.

Whittier almost certainly would be found out of compliance with a newly adopted ABA rule that the first-year academic attrition rate be no more than 20 percent, McEntee said. Whittier’s academic attrition rate was more than 42 percent in 2016, and has been above the 20-percent threshold for the past five years.

“The ABA is starting to show its teeth,” McEntee said. “If [Whittier] feared losing accreditation more than anything else, that could have been a factor in the decision.”

While the decision to discontinue the law school may make financial sense, it’s a “human tragedy” for the students and faculty, Caron said.

Whittier College President Sharon Herzberger broke the news of the closure to students during an emergency meeting Wednesday. She said campus leaders had explored myriad ways to keep the campus open, including mergers and sales, but had found no viable solutions, according to a report  in the Orange County Register.

Officials told current students they would be able to finish out their studies at Whittier, but they had no answers for student questions about whether courses, programs and other resources would be curtailed or cut altogether in the next two years, said Hanna Chandoo, a 2015 Whittier law graduate who attended the meeting and attorney at Los Angeles firm Stris & Maher who is representing a group of faculty hoping to stop the closure.

“It was very heartbreaking,” Chandoo said of Wednesday’s meeting. “Students are outraged. I’ve heard from a few this morning that they couldn’t sleep. They have finals in the next two weeks. This really couldn’t have come at a worse time. This is going to affect their ability to keep their head in the game.”

Meanwhile, the Whittier Law faculty released its own statement condemning the closure.

“Sadly, our sponsoring institution opted to abandon the law school rather than provide the time and resources needed to finish paving the path to ongoing viability and success,” the statement reads. “We believe this action was unwise, unwarranted, and unfounded.”

Ensuing Litigation

Seven faculty members on Tuesday filed for a temporary restraining order seeking a 48-hour stay of the school’s discontinuation and to prevent the meeting at which the closure was announced.

Making that announcement so soon would send applicants fleeing and prompt current students to transfer to other schools, according to the TRO request. However, Whittier College officials determined that the announcement needed to be made Wednesday to allow current applicants to explore other options, according to the TRO request.

The law faculty argued that Whittier College is violating their employment contracts by unlawfully shutting the school down. The college had not proven either a financial exigency or a deficient educational program—the two possible grounds for terminating tenured faculty under the guidelines of the American Association of University Professors, according to the TRO filing.

In fact, a task force commenced last summer to look specifically at the discontinuance of the law school concluded that the school should remain, it said.

However, a statement from Board of Trustees Chairman Alan Lund said that an extensive study of the school’s future did not reveal any viable options to save it.

“We believe we have looked at every realistic option to continue a successful law program,” Lund wrote. “Unfortunately, these efforts did not lead to a desired outcome.”

The faculty TRO request contends that Whittier College should have reinvested the $13 million in profit it made the sale of the law school’s 14-acre campus earlier this year back into the school—which didn’t happen, the suit alleges.

“They’re shutting down a law school that they don’t think is valuable because it’s full of minority students,” said Chandoo, noting that minorities comprise nearly 59 percent of the student body. “And they’re shutting down a law school that is no longer valuable to them because the only piece of value they attributed to the law school was the land, which they’ve now sold. Now that their money grab is over, they’re ready to shut it down.”

The faculty’s legal action was rushed, as the law school deans only learned of the board’s decision on Friday, said Chandoo. A state court judge heard the TRO request ex-parte on Tuesday morning, but rejected it on First Amendment grounds, she said.

The faculty is now regrouping and reviewing their legal options. Whittier law students are also keenly interested in their potential legal recourse, Chandoo added.

Contact Karen Sloan at ksloan@alm.com. On Twitter: @KarenSloanNLJ