Georgetown University, along with 15 other private universities, are now defendants in an antitrust lawsuit recently filed in Illinois federal court regarding their financial aid calculations. The plaintiffs are five former students who attended some of the defendant universities and allege they engaged in price fixing and unfairly limited financial aid by utilizing a shared calculation method for applicants’ financial needs.
The defendants are private, national universities that are members of an organization titled the “568 Presidents Group.” The group’s name is derived from a section of federal law permitting collaboration among universities on financial aid formulas if they do not consider a student’s ability to pay in the admissions process–a status called “need blind.”
However, plaintiffs call the defendants “the 568 Cartel.” They allege that at least nine of the schools involved do not qualify for the exemption because they “made admissions decisions taking into account the financial circumstances of applicants and their families, through policies and practices that favored the wealthy.” In other words, the defendants improperly considered applicants’ respective abilities to pay.
The defendants have not yet responded to the Complaint. However, they may have numerous defenses available as to both the individual and class claims. For example, the defendants may argue that the plaintiffs lack standing to sue because they did not suffer an injury in fact. Unless the plaintiffs can show that the application process led to them paying more or not getting admitted to the school because of their financial status, the defendants may have a viable argument that the court lacks jurisdiction over the case.
Additionally, as to the class allegations, the defendants may argue that there are no questions of fact or law common to the class. Each plaintiff’s harm was potentially different. Their money damages were different and some of the plaintiffs may not have suffered money damages at all—because they were not admitted to the school. This case may be an important case to watch in the coming weeks and months, as colleges and universities continue to recover from the COVID-19 pandemic.