Lawsuit Alleges Notre Dame and Georgetown Among Universities Rig Financial Aid | Catholic National Register


The lawsuit accuses the 16 schools of prioritizing the admission of children of wealthy donors, making waitlist decisions based on a potential student’s finances and family wealth, or deciding whether to admit applicants to specific programs depending on the finances of the student or the family.

CHICAGO, Illinois – Notre Dame University and Georgetown University are among 16 elite private universities and colleges facing a federal lawsuit that alleges they illegally plotted to cut financial aid to students, in fact a form of pricing.

The trial, filed in Chicago federal court on Jan. 9, described these schools as a “cartel” that sets prices and acts “not only to reduce the total amount of aid offered by each school, but also to reduce the amount. total aid offered to each potential student in each defendant school.

Current federal law requires that college and university financial aid decisions not be based on need as a condition of their exemptions from antitrust law.

Peter McDonough, vice president and general counsel for the higher education public policy group American Council on Education, told the New York Times he would be “very surprised” if the lawsuit were found to be valid.

He said the defendants were “very aware of the antitrust laws and particularly sophisticated.”

“They are getting good advice,” he said, comparing the lawsuit to a 1990s Department of Justice case filed against Ivy League schools and the Massachusetts Institute of Technology. This case resulted in a favorable judgment for the universities.

The lawsuit accuses the 16 schools of prioritizing the admission of children of wealthy donors, making waitlist decisions based on a potential student’s finances and family wealth, or deciding whether to admit applicants to specific programs depending on the finances of the student or the family.

Five former students from Vanderbilt, Northwestern and Duke are the first plaintiffs in the case. Roche Freedman, Gilbert Litigators & Counselors, Berger Montague and FeganScott filed a lawsuit in the Northern District of Illinois on their behalf Sunday night.

The defendants in the lawsuit are some of the most elite schools in the country: Brown, California Institute of Technology, University of Chicago, Columbia, Cornell, Dartmouth, Duke, Emory, Massachusetts Institute of Technology, Northwestern, University of Pennsylvania, Rice, Vanderbilt, Yale, Notre Dame and Georgetown.

The two Catholic universities on the accused list are the Congregation of the Holy Cross headed by Notre Dame and the Jesuit University of Georgetown. They and seven other defendant institutions carried out the alleged conspiracy by ignoring indiscriminate admission policies. Instead, they considered the financial situation of prospective students and their families “through policies and practices that favored the rich”.

Georgetown declined to comment on the matter. CNA sought comments from Notre Dame but did not receive a response within the time limit. A spokesperson for Yale told the New York Times that the university complies with all applicable laws.

Brown University spokesman Brian E. Clark told NBC News that, based on a preliminary examination, “the complaint against Brown has no merit and Brown is willing to put in a great effort to make it clear “.

The lawsuit claims that perhaps 170,000 students could be eligible plaintiffs, as well as those who helped pay for their university. The alleged financial overcharging amounts to hundreds of millions of dollars. Plaintiffs eligible to join the class action would have attended schools, or paid for a student’s attendance, during the period of 2003 in cases where the student received some form of financial assistance without fully covering the costs. tuition, accommodation and board.

Under Section 568 of the relevant Federal Law of 1994, colleges and universities that do not meet admission requirements may cooperate with their competitors. This is a derogation from antitrust laws.

The lawsuit argued that schools’ participation in the 568 Presidents Group, a collective of colleges and universities that insists on requiring college admissions regardless of need, has instead resulted in collusion that prevents institutions to compete on the price of tuition.

“While conspiring together on a method of awarding financial aid, which raises the prices net of tuition fees, the defendants also take into account the wealth of applicants and their families when making admissions decisions. “said the lawsuit.

The lawsuit criticized Notre Dame admissions for allegedly following a form of enrollment management model that is legally problematic. He also criticized the school’s partnership with a software company for using data analytics to “shape admissions decisions based on needs.”

Additionally, the lawsuit cited admissions staff and leaders at various institutions who discussed the potential for donation of prospective students and their families. These leaders also noted the favoritism shown towards the children of high potential donors.

“Georgetown admits a range of students based on the wealth, prestige and influence of their families,” the lawsuit said. “Some of these students get ‘extra consideration’ based on their parents’ political influence or power, without any expectation of financial contribution. On the other hand, some are given an “additional consideration” on the basis of their “development potential”, namely the family’s ability to make a financial contribution to the institution, and the likelihood that it will do so. “

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