## Facts

- J.C., a sixteen-year-old student with severe intellectual disabilities, received special education services through a district-selected day program beginning in 1987.
- J.C.’s IEP focused largely on personal and self-help skills (e.g., toileting, dressing, feeding), basic communication, and life skills.
- J.C.’s parents believed the program produced little progress and that J.C. plateaued or regressed in important self-help skills.
- The parents sought (1) a residential placement as necessary for an appropriate education and (2) compensatory education beyond age 21 to remedy past denial of appropriate services.
- An administrative law judge found J.C. received an appropriate education because he obtained some educational benefit and denied relief.
- The district court ordered residential placement but denied compensatory education based on the district’s good faith and provision of some educational program.
- The school district appealed the residential-placement order; the parents cross-appealed the denial of compensatory education.

## Issues

1. Whether the district court applied the correct IDEA standard and had record support for ordering a residential placement as necessary for J.C. to receive a free appropriate public education (FAPE).
2. Whether compensatory education under IDEA may be denied based on the school district’s good faith, and what standard governs entitlement to compensatory education.

## Decision

- The court of appeals affirmed the order requiring residential placement.
- The court of appeals reversed the denial of compensatory education and remanded.
- The court held good faith is not the governing test for compensatory education.
- The court held a student is entitled to compensatory education when the district knew or should have known the IEP was inappropriate or the student was receiving only de minimis educational benefit and failed to correct the problem within a reasonable time.

## Legal Principles

- Under IDEA, FAPE requires an IEP reasonably calculated to confer educational benefit; more than de minimis benefit is required.
- A residential placement may be required as part of FAPE when necessary for the student to receive meaningful educational benefit, not merely for non-educational reasons.
- Compensatory education is an equitable remedy for denial of FAPE and is not defeated by the district’s good intentions.
- When a district knows or should know a student’s program is inappropriate or yields only de minimis benefit, it must timely correct the situation.
- If the district fails to do so, compensatory education is owed for a period equal to the deprivation, excluding only the time reasonably required to rectify the problem.

## Conclusion

The Third Circuit upheld residential placement as necessary for J.C. to obtain meaningful educational benefit under IDEA and clarified that compensatory education turns on the district’s knowledge (actual or constructive) of an inadequate program and failure to correct it within a reasonable time, not on good faith.


M.C. ex rel. J.C. v. Cent. Reg'l Sch. Dist., 81 F.3d 389 (3d Cir. 1996)