District Wins: Settlement Agreement Did Not Create Stay-Put Rights for Big Springs Placement

A parent challenged whether a settlement agreement that placed their child at a nonpublic agency (Big Springs) gave the child 'stay-put' rights during a later due process case. The ALJ found that the settlement was a temporary financial arrangement, not a permanent placement, and did not trigger stay-put protections. The district prevailed on all issues, and the student's requests for relief were denied.

What Happened

Student is a child with a speech and language impairment whose family lived within the Murrieta Valley Unified School District. In fall 2006, the district held multiple IEP meetings and made a formal offer of placement in a special day class at a district school. The parents disagreed with that offer — they wanted their child to receive one-to-one educational therapy at a nonpublic agency called Big Springs. Rather than file for due process, the parties negotiated and signed a settlement agreement in December 2006. That agreement had the district funding two 50-minute sessions per day of one-to-one educational therapy at Big Springs through June 2007, along with a partial day placement in the district's special day class and extended school year (ESY) services at Big Springs in summer 2007.

After the settlement period ended, the parents and district could not agree on placement for the 2007-2008 school year. The parents filed for due process in August 2007, arguing (among other things) that the Big Springs services from the settlement should have continued as the child's "stay-put" placement while that case was pending. That earlier case was decided in the district's favor. The parents then filed this second due process case, arguing that the district had circumvented the IEP process by using the settlement agreement, and that the Big Springs services should have been treated as stay-put during both the earlier due process case and the federal court appeal that followed.

What the ALJ Found

The ALJ rejected all of the parent's claims and found in favor of the district on every issue.

On the question of whether the district circumvented the IEP process by using a settlement agreement, the ALJ found no violation. California and federal law strongly encourage informal resolution of special education disputes. Nothing in the law prohibits a district from pursuing settlement at the same time as the IEP process, and the parents in this case actively sought a settlement — the mother had emailed the district asking whether a settlement for Big Springs services would be offered. Because full IEP meetings were held in fall 2006, an offer of FAPE was made, and the parents had a meaningful opportunity to participate, there was no circumvention of the IEP process.

On the question of whether the district was required to hold a follow-up IEP meeting to incorporate the settlement terms into the IEP, the ALJ said no. The U.S. Department of Education has specifically stated that nothing in the law requires an IEP team to reconvene after a settlement unless the settlement itself says so. The settlement agreement here did not require a follow-up IEP meeting.

On the most significant issue — whether the Big Springs placement in the settlement became the student's "stay-put" placement — the ALJ concluded it did not. The law looks to what the parties actually intended when they signed the settlement, not just what services were physically being provided. The settlement had a specific end date (June 15, 2007), did not say it would be stay-put, and described the district's obligation as "funding" the placement rather than establishing it as a permanent educational placement. Under contract interpretation principles, the temporary nature of the agreement meant it could not serve as stay-put in a later dispute.

What Was Ordered

The student's requests for relief were denied in their entirety.
The district prevailed on all issues heard and decided.

Why This Matters for Parents

A settlement agreement is a contract — read it carefully before signing. The ALJ interpreted the settlement strictly based on its written terms. Because the agreement had an end date and said nothing about stay-put, the parent lost the stay-put argument entirely. If you want settlement services to count as stay-put in a future dispute, that must be written explicitly into the agreement before you sign.
Pursuing a settlement alongside the IEP process is legally permitted. The district here ran both processes at the same time, and the ALJ found no problem with that. Parents should know that a settlement offer does not replace your right to a formal IEP — but the law does not require the district to put settlement terms into an IEP afterward unless you negotiate that into the agreement.
Stay-put is tied to your last agreed-upon IEP placement, not what was actually happening day-to-day. Even though Student was physically attending Big Springs under the settlement, that did not automatically make Big Springs the stay-put placement. The legal stay-put baseline is typically the last IEP placement the parties agreed to — which here was the district's November 2006 offer.
If you want future protections, negotiate them now. This case shows that what you don't put in writing can hurt you later. Parents who sign settlement agreements should work with an advocate or attorney to ensure that any desired stay-put protections, IEP follow-up meetings, or continuation rights are clearly stated in the settlement document itself.

What Happened

What the ALJ Found

The ALJ rejected all of the parent's claims and found in favor of the district on every issue.

What Was Ordered

The student's requests for relief were denied in their entirety.
The district prevailed on all issues heard and decided.

Why This Matters for Parents

A settlement agreement is a contract — read it carefully before signing. The ALJ interpreted the settlement strictly based on its written terms. Because the agreement had an end date and said nothing about stay-put, the parent lost the stay-put argument entirely. If you want settlement services to count as stay-put in a future dispute, that must be written explicitly into the agreement before you sign.
Pursuing a settlement alongside the IEP process is legally permitted. The district here ran both processes at the same time, and the ALJ found no problem with that. Parents should know that a settlement offer does not replace your right to a formal IEP — but the law does not require the district to put settlement terms into an IEP afterward unless you negotiate that into the agreement.
Stay-put is tied to your last agreed-upon IEP placement, not what was actually happening day-to-day. Even though Student was physically attending Big Springs under the settlement, that did not automatically make Big Springs the stay-put placement. The legal stay-put baseline is typically the last IEP placement the parties agreed to — which here was the district's November 2006 offer.
If you want future protections, negotiate them now. This case shows that what you don't put in writing can hurt you later. Parents who sign settlement agreements should work with an advocate or attorney to ensure that any desired stay-put protections, IEP follow-up meetings, or continuation rights are clearly stated in the settlement document itself.