It is very clear what is going on in that case. It has nothing to do with "liberals" or any other rant of Faiths.
The rules obviously are: If you have a grade point average of (pick a number but they picked) 3.15 then you are an "honor" student. It never occurred to anyone to think through some scenarios. And that you could get a 3.15 and yet fail a subject or two.
Not a big deal at all. Not even newsworthy to me. Just something to fix for the next round of reporting. I.e., A GPA of 3.15 or higher an no single subject less than a GPA of 2 perhaps.
Sorry, Dr A, I think that was a long winded way of saying -- I agree with you.