West Virginia Judges Give Preliminary OK to University Settlement

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A January hearing is set on a proposed settlement of hundreds of lawsuits against Mountain State University.

Media outlets reported that a three-judge mass litigation panel gave preliminary approval to the settlement Monday following a hearing in Beckley. The decision allows the former university to begin liquidating its assets.

Proceeds from the liquidation will be used to compensate former students who sued the university after it lost its accreditation in 2012. The compensation fund also would include $8.5 million from Mountain State’s insurance carrier and the U.S. Department of Education.

According to Kanawha Circuit Court documents on the mediation, the insurer is United Educators Insurance, which issued a $10 million educators’ legal liability policy for the school through the Songer Insurance Agency in Beckley.

The University of Charleston took over Mountain State’s campuses in Beckley and Martinsburg so students could complete their degrees. The university’s lease runs through June 2015.

A hearing is set for Jan. 15 in Charleston to discuss the settlement’s final terms.

The Higher Learning Commission revoked Mountain State’s primary accreditation in June 2012 after years of failing to correct major problems in leadership, program evaluations and campus wide governance. When a university loses its primary accreditation, any subsequent degrees conferred by the university are effectively worthless.

According to the state Higher Education Policy Commission, Mountain State is the first higher education institution ever in West Virginia to have its school-wide accreditation revoked.