You know the facts better than any attorneys here, but there is one issue that you should give serious consideration to. If the epilepsy is the reason for cutting her from the squad, why did the school wait for 2 years after her diagnosis? That tends to suggest that other factors and circumstances caused the school's action.
Your daughter does not have an enforceable legal right to be on the cheer squad and you will need actual evidence of a prohibited basis for the action if you wish to pursue a legal claim on this matter. Don't be shocked if the school can articulate a non-discriminatory basis for the action.
On the up side, it is clear that your daughter is a multi-faceted young lady with a lot going for her. Don't let the loss of one year of cheering -- after 5 years of participation -- be a "heart-break" for her. There is too much else that life offers to engage her and that will allow her to realize her full potential.
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I understand that your daughter is upset about being cut from the team, particularly for her senior year. There are several unanswered questions. Have you or your daughter spoken to the coach and asked the reason for the cut? Was your daughter ever given a warning by the coach that she may be cut? Were any other cheerleaders cut from the team? Has the coach ever spoken to you or your daughter regarding her seizure disorder? If they released your daughter from the team as soon as she was diagnosed that would appear to have been a discrimination case. The fact that two years have passed make it much more difficult to prove that your daughter was being discriminated against. I suggest that you and your daughter schedule a meeting with the cheerleading coach and the school principal to determine why the coach chose to cut your daughter from the team without any warning. Make that call first thing Monday morning.