Ivy League schools acting like ‘price-fixing cartel,’ lawsuit says — Analysis

Lawsuit alleges that 16 main US universities are ‘conspiring’ to restrict monetary help packages for needy college students

Sixteen high US universities, together with a lot of prestigious Ivy League colleges, have been accused of violating antitrust legal guidelines by working collectively to determine how a lot monetary assist needs to be awarded to potential college students.

The lawsuit, which was filed in Illinois federal court docket on Sunday, accuses the schools of appearing like a “price-fixing cartel” by sharing the methodology they use to find out monetary help packages. Via this, the swimsuit claims the faculties “conspired” to restrict help affords from “supposedly competing” establishments, thereby “artificially [inflating]” the price of admission for needy college students.

Among the many establishments named within the swimsuit are Yale, Georgetown, Northwestern, Columbia, Cornell, Duke, Brown, and the Massachusetts Institute of Expertise (MIT). The listing additionally contains Chicago, Notre Dame, Pennsylvania, Emory, Rice, and Vanderbilt universities, in addition to Dartmouth Faculty and the California Institute of Expertise.

Describing the establishments as “gatekeepers to the American Dream,” the 5 plaintiffs – who have been previously undergrads at a number of the accused colleges – allege that greater than 170,000 college students who acquired monetary help had been overcharged by “at the least a whole lot of hundreds of thousands of {dollars}.”

The lawsuit refers back to the Enhancing America’s Colleges Act (1994), which allowed 28 universities with a “need-blind” coverage – which doesn’t take into account candidates’ monetary want throughout the admissions course of – to develop a “Consensus Methodology” to find out a scholar’s means to pay tuition and different charges.

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Nevertheless, the swimsuit alleges that at the least 9 universities made admissions after accounting for monetary circumstances, violating the ‘need-blind’ rule and favoring rich college students. The plaintiffs declare this contravenes antitrust exemptions within the 1994 act.

Additional, they declare that the opposite seven establishments “conspired” with these 9 universities to scale back monetary help quantities regardless of allegedly having recognized that they weren’t following need-blind insurance policies. The swimsuit seeks unspecified damages and a court docket injunction banning the “egregious” follow, which they argue locations added burden on low- and middle-income households.

Whereas a majority of the accused universities have declined to situation statements, some have claimed that the lawsuit had “no advantage.” Spokespersons for Yale and Brown have defended their faculty’s admissions practices and monetary help insurance policies as being “compliant” with the regulation. Others stated the submitting was nonetheless being reviewed.

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