Cape Fear Academy sexual harassment lawsuit: Here's what you need to know
Three former students of Cape Fear Academy are suing the school after accusing the school of failing to abide by Title IX after accepting a federal loan through the Paycheck Protection Program.
Since then, the students, others who attended the school previously, Title IX experts, and more have weighed in on the case as the school holds strong on its position that it is not bound to follow Title IX, and abides by its own diversity policies.
As the lawsuit continues to evolve, stay up to date on all the new information and coverage from the StarNews. This story will be updated with all new content published.
Lawsuit filed
Three former Cape Fear Academy students and their parents initially filed a lawsuit against the school in October 2021. Those students – two who graduated in 2021 and one who had moved to a different school – alleged the school did not address their complaints of sexual harassment, and then retaliated against the students for taking action on their own.
Jane Doe and other students created a petition to get three boys removed from their speaking positions at graduation after they were accused of continuous sexual harassment with little discipline by the school. Jane Doe was not allowed to attend her high school graduation when she refused to apologize to the boys, and her sister, Jill Doe, was not allowed to return to the school the following year.
Read more: Former Cape Fear Academy students claim retaliation after reporting sexual harassment
Speaking out
The three former students and their parents told the StarNews they finally feel ‘seen’ after the lawsuit began gaining publicity. Months after the incidents occurred, the girls continued getting emotional describing the ways they were treated by their classmates and staff at the school.
The former students detailed their experiences with sexual harassment by their peers and the alleged retaliation by school administrators that led to Jane Doe being banned from graduation and caused all three students physical and mental health issues.
Read more: Former Cape Fear Academy students: We finally feel 'seen' after filing lawsuit
Title IX allegations
As a private school funded entirely by tuition and donations, Cape Fear Academy was long exempt from federal regulations such as Title IX, which protects students at federally funded schools from gender-based discrimination. But as COVID-19 began spreading in March 2020, the school accepted a Paycheck Protection Program loan, a federally regulated loan program.
Title IX experts, as well as the former students’ lawyer, said by accepting that loan, the school became legally obligated to follow Title IX, changing the process by which they are expected to address complaints of gender-based discrimination like sexual harassment.
Read more: How Title IX applies to three former students now suing Cape Fear Academy
More students come forward
Students from past graduating classes came forward to shared similar experiences of sexual harassment and bullying that allegedly went unaddressed at Cape Fear Academy. The attorney for the former students said he had numerous students and families contact him, but who are unable to file legal action because the school was not legally obligated to follow Title IX at the time.
Two of those students spoke to the StarNews, sharing their experiences of bullying, sexual harassment and racism by their peers at Cape Fear Academy, with reportedly little action taken by school administrators to address the issues.
Read more: More former Cape Fear Academy students speak out: School's environment was 'toxic'
Cape Fear Academy responds
In place of a response to the lawsuit, Cape Fear Academy’s attorneys filed two motions to dismiss the lawsuit: One on the basis of the plaintiffs using pseudonyms and the other stating the students failed to state a valid claim.
The school claimed in its response the students did not bring forward a valid claim because though the PPP loan it accepted was through the Small Business Administration, the funds came from a private lender, First Carolina Bank. Therefore, the school argued, it was not legally bound to follow Title IX as a private institution. It also argued the students could not use pseudonyms unless they were granted that privilege by a judge.
Read more: Cape Fear Academy says lawsuit allegations are not 'extreme' enough to fall under Title IX
PPP and Title IX
Cape Fear Academy accepted more than $1 million in financial assistance through a PPP loan at the start of the COVID-19 pandemic. While the plaintiffs in the lawsuit said because of that, the school is receiving federal funding and is legally obligated to follow Title IX, the school said it is not bound to Title IX because the loan came from a private lender,
The U.S. Department of Justice says organizations receiving funding from the Small Business Administration are required to follow Title IX, and according to the National Law Review, PPP loans are included in that definition.
Read more: Was Cape Fear Academy covered by Title IX? How PPP loans impacted independent schools
Plaintiffs reveal their names
In response to Cape Fear Academy’s motion to dismiss, the three former students and their parents revealed their names in an amended lawsuit, rather than continuing to use pseudonyms. The plaintiffs originally used pseudonyms to protect their privacy, but decided to amend the lawsuit with their real names to avoid delaying litigation due to the school’s motion to dismiss.
Additionally, the plaintiffs reiterated their argument that the school is legally obligated to follow Title IX, making its motion to dismiss for failing to state a claim invalid.
Read more: Former Cape Fear Academy students reveal names in amended lawsuit following school's response
Another motion to dismiss
Cape Fear Academy filed an additional motion to dismiss in response to the amended lawsuit. The school maintained its argument that it was not required to follow Title IX because the loan came from a private lender. It argued the loan was a guaranty, and the federal government acted as a guarantor in the instance the school defaulted on repaying the loan, but did not provide the loan itself.
It also maintained its argument that the plaintiffs could not prove the school was deliberately indifferent toward objectively severe and offensive forms of sexual harassment.
Read more: Cape Fear Academy responds to most recent sexual harassment, retaliation lawsuit motion filed
Plaintiffs ask court not to dismiss
The plaintiffs in the lawsuit again responded to the school's motion to dismiss, asking courts to reject it. The response argued any loan coming from the Small Business Administration is federal financial assistance, including a Paycheck Protection Program loan, saying the claim by the school is "simply wrong."
The response also asks the court to leave the decision on whether their allegations were extreme and outrageous up to a jury.
Read more: Former Cape Fear Academy students ask court not to dismiss their case in recent response
Experts weigh in on teachers' obligation to address harassment
When the plaintiffs in the lawsuit complained to teachers about comments from their peers that made them uncomfortable, the teachers suggested pulling one of the plaintiffs out of class and having her do separate work from the rest of her classmates.
Gender and education experts say it's up to both administrators and teachers to set the tone in the classroom and school and make sure students know what behaviors are not acceptable. They said schools should educate their teachers on how to respond to instances of bullying or harassment.
Read More: Cape Fear Academy lawsuit: Teachers obligated to deal with harassment, experts say
A history of Cape Fear Academy
Cape Fear Academy is one of the most prestigious in the Wilmington area, boasting admissions at universities such as Yale and Stanford and featuring many notable alumni. The school opened more than 50 years ago, starting as a segregationist academy around the time New Hanover County public schools were ordered to integrate.
Today, the school has found itself in the spotlight after three former students filed a lawsuit claiming Cape Fear Academy violated Title IX after it allegedly failed to protect them from sexual harassment and retaliated against them when they took measures to address the harassment on their own.
Read more: Cape Fear Academy, top preparatory school with segregationist history facing Title IX lawsuit
Motion to dismiss denied
A district court judge denied Cape Fear Academy's motion to dismiss the plaintiffs' Title IX claims. The school argued that the loan was a guaranty and was not subject to Title IX, because the funding was coming from a private entity – First Carolina Bank – and the federal government was acting as a guarantor in the case the school defaulted on paying back the loan.
District Court Judge James Dever said the argument is invalid and the PPP loan is considered federal financial assistance in a decision released Friday. He said in the decision the Paycheck Protection Program was referred to as a loan 75 times in the federal CARES Act, and First Carolina Bank is “the intermediary” in a measure passed by Congress to allow businesses to receive financial assistance during the pandemic.
Read more: Cape Fear Academy sexual harassment lawsuit: Judge upholds Title IX claims
Reporter Sydney Hoover can be reached at 910-343-2339 or shoover@gannett.com.
This article originally appeared on Wilmington StarNews: Cape Fear Academy lawsuit: What to know about students suing school
