Lawsuit: Yale, Georgetown, Other Top Schools Illegally Collude to Limit Financial Aid

A lawsuit claims that sixteen major U.S. universities — including Yale University, Georgetown University, and Northwestern University — have violated antitrust laws by working together to determine financial aid awards for students, according to a report by the Wall Street Journal.

The Wall Street Journal reports that the lawsuit was filed in Illinois federal court late on Sunday by law firms representing five former students who attended several of the universities. The suit claims the schools engaged in price-fixing and unfairly limited aid by using a shared methodology to calculate students’ financial needs.

Under federal law, schools are permitted to collaborate on their formulas, so long as they don’t consider applicants’ financial needs in their admissions decisions. The lawsuit claims these universities do consider applicants’ financial needs in certain circumstances, and therefore should not be eligible for the antitrust exemption.

In addition to Yale, Georgetown, and Northwestern, the 13 other schools named in the lawsuit are Brown University, the California Institute of Technology, the University of Chicago, Columbia University, Cornell University, Dartmouth College, Duke University, Emory University, the Massachusetts Institute of Technology (MIT), the University of Notre Dame, the University of Pennsylvania, Rice University, and Vanderbilt University.

The suit seeks damages, as well as a permanent end to the universities’ collaboration involving financial needs and awarding aid, reports the Journal.

The suit was reportedly filed in the Northern District of Illinois by the firms Roche Freedman, Gilbert Litigators & Counselors, Berger Montague, and FeganScott.

“While conspiring together on a method for awarding financial aid, which raises net tuition prices, defendants also consider the wealth of applicants and their families in making admissions decisions,” Eric Rosen, a partner at Roche Freedman, said.

Rosen was also a lead prosecutor on the infamous “Varsity Blues” college admissions cheating scandal in 2019.

You can follow Alana Mastrangelo on Facebook and Twitter at @ARmastrangelo, and on Instagram.