The American Association of Cosmetology Schools sued Education Secretary Betsy DeVos claiming that a gainful-employment rule implemented by the Obama administration shouldn't be applied to beauty schools.

The lawsuit, filed Friday in federal court in Washington, seeks an order barring the rule that threatens career schools' access to federal student aid if they saddle their graduates with too much debt relative to their earnings. The trade group said the rule is harmful when applied to beauty schools, whose graduates typically underreport income from cash tips.

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"We would have preferred to work this out in a fair and equitable manner in any other forum," said Edward Cramp, a partner with the law firm Duane Morris LLP who serves as outside general counsel for the AACS. "Unfortunately, our schools are nearing a crisis point, and we were forced to sue, to protect these schools from this untenable federal regulation as it applies to this sector of higher education."

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