2 more universities to pay $35.2M to settle allegations of favoring wealthy students in admissions and financial aid

Attorneys representing 200,000 students alleged that 17 schools, including Penn, favored wealthy students in financial aid and admissions decisions over a 20-year period.

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An University of Pennsylvania sign is seen in Philadelphia, Friday, Dec. 15, 2023. (AP Photo/Matt Rourke)

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Two more institutions have agreed to pay $35.2 million to settle allegations that a group of prestigious universities, including the University of Pennsylvania, conspired to favor students of wealthy families when considering admissions or financial aid.

If U.S. District Judge Matthew Kennelly approves the proposed settlements by the California Institute of Technology (for $16.7 million) and Johns Hopkins University (for $18.5 million), only five universities will remain under antitrust scrutiny: Penn, Cornell University, Georgetown University, the Massachusetts Institute of Technology and the University of Notre Dame. Their inclusion would bring the total settlement amount to roughly $320 million.

In 2022, attorneys representing a class of about 200,000 students filed a complaint in U.S. District Court in Illinois, alleging that 17 universities in the “568 Presidents Group” acted like a cartel by fixing financial aid and admissions practices in violation of U.S. antitrust laws. The alleged misconduct spans a 20-year period.

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Since the initial complaint, 12 universities have reached settlements, including:

  • Brown University: $19.5 million
  • Columbia University: $24 million
  • Duke University: $24 million
  • Dartmouth College: $33.75 million
  • Emory University: $18.5 million
  • Yale University: $18.5 million
  • Northwestern University: $43.5 million
  • Rice University: $33.75 million
  • Vanderbilt University: ($55 million)
  • California Institute of Technology: $16.7 million
  • Johns Hopkins University: $18.5 million

All of the settling institutions deny wrongdoing, stating they settled to avoid prolonged and expensive litigation.

Robert Gilbert, an attorney with Gilbert Litigators & Counselors P.C. representing the plaintiffs, criticized the five universities still facing litigation, saying they should “stand up finally and do the right thing” by compensating students and alumni for alleged overcharges that occurred alongside the growth of their endowments.

According to court filings, the plaintiffs allege many of these schools kept lists identifying applicants by family wealth, past donations or potential for future gifts. Students on these lists allegedly received preferential treatment in admissions decisions and financial aid packages, resulting in higher costs for others.

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A University of Pennsylvania spokesperson, in a statement emailed to WHYY News, called the plaintiffs’ case “an attempt to embarrass the university about its purported admission practices on issues totally unrelated to this case,” adding that Penn does not grant admission preference based on donations.

Information on the settlements and the claims process is available online. Kennelly approved $20,000 service awards for each of the named plaintiffs, including Andre Corzo, Sia Henry, Alexander Leo-Guerra, Michael Maerlender, Brandon Piyevsky, Benjamin Shumate, Brittany Tatiana Weaver and Cameron Williams. He also approved payment of legal fees and expenses for the plaintiffs’ law firms.

John Lopatka, a law professor and antitrust scholar at Pennsylvania State University, said it is common in complex antitrust cases for some defendants to settle while others fight on.

“Eventually all of the defendants may settle, or some may fight to the end,” he said. “We’ll just have to see how this unfolds.”

Correction: A previous version of this story misstated that two more institutions have agreed to pay $32.5 million to settle allegations of wealthy students in admissions and financial aid. It has been corrected to reflect that the institutions have agreed to pay $35.2 million.

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