Antitrust Lawsuit: 17 Prestigious U.S. Universities Investigated for Financial Aid Restriction

In a significant court hearing concerning a private antitrust lawsuit, seventeen prestigious U.S. colleges and universities face allegations of colluding to restrict financial aid, shedding light on a parallel investigation conducted by the U.S. Justice Department. As part of the government's probe into similar issues, at least one high-ranking admissions official has been questioned.
 

The lawsuit was filed last year in a federal court in Chicago by a group of students against renowned institutions like Brown University, Georgetown University, and Yale University, along with fourteen others. Seeking class-action status on behalf of potentially hundreds of thousands of students, the complaint accuses these universities of overcharging billions of dollars in tuition fees. In response to the lawsuit, the University of Chicago intends to settle the case.
 
During the hearing, U.S. District Judge Matthew Kennelly revealed that the Justice Department and the New York attorney general's office were conducting a parallel investigation of the same issues raised in the private lawsuit. However, specific details about the scope of the investigation and the targeted schools were kept private.
 
In response to the revelation, a DOJ's antitrust division spokesperson declined to comment, and the New York attorney general's office did not immediately respond to inquiries.
 
Judge Kennelly brought up the government investigation while considering the plaintiffs' motion for sanctions against Georgetown and its legal representatives over their conduct during the litigation. The motion details were filed under seal and addressed in open court during the hearing.
 
Expressing his concern, Judge Kennelly chastised defense lawyers for not informing the court about the ongoing government probe before issuing an order in March 2023 related to evidence collection in the case. He questioned why the court was unaware of depositions from individuals involved in the government investigation, who addressed the same issues as the private lawsuit.
 
Georgetown University and its legal representation did not immediately respond to the court's request for comment following the hearing. At present, Judge Kennelly refrained from issuing any sanctions and stated that the plaintiffs' request was under "advisement." He disapproved of the defense's conduct, cautioning that it might influence future rulings.
 
In response to the court's rebuke, the attorney representing the plaintiffs, Robert Gilbert stated that the court's stance "speaks for itself."
 
It's worth noting that the U.S. Justice Department had previously filed a "statement of interest" in the case, asserting that the plaintiffs had adequately presented allegations of a potential violation of U.S. antitrust law.
 
As the investigations continue, the universities involved in the lawsuit and the affected students await further developments. The outcome of both the private antitrust lawsuit and the government's parallel investigation could have significant implications for higher education institutions and their financial aid practices. This legal battle is being closely monitored by the public and the education sector alike, as it can potentially shape the future of financial aid policies in academia.