A new federal lawsuit filed on behalf of five former students accused Emory University and 15 other major U.S. universities of violating antitrust laws by illegally colluding to manipulate the amount of financial aid granted to students.

The class action lawsuit filed in Illinois federal court on Jan 9, and first reported by The Wall Street Journal, stated the universities “explicitly aimed to reduce or eliminate price competition among its members.”

Director of Enterprise Communications Gana Ahn said the University declined to comment on the pending litigation in a Jan. 11 email to the Wheel.

The nine primary defendants of the suit — Columbia University (N.Y.), Dartmouth College (N.H.), Duke University (N.C.), Georgetown University (D.C.), Massachusetts Institute of Technology, Northwestern University (Ill.), the University of Notre Dame (Ind.), the University of Pennsylvania and Vanderbilt University (Tenn.) — are stated to be members of the “568 Presidents Group,” an affiliation of universities that use a “consensus methodology” to calculate applicants’ financial aid. 

Emory was part of the 568 Presidents Group from 2004 to 2012, according to the suit.

The group’s name refers to an antitrust exemption granted by Section 568 of the Improving America’s Schools Act, which allows universities to share methodologies for calculating applicants’ financial aid as long as those schools practice entirely need-blind admissions.

Emory University was one of 16 universities named in a federal lawsuit that alleged the schools had violated antitrust laws by illegally colluding to manipulate the amount of financial aid granted to students.
(Jackson Schneider)

However, the plaintiffs allege these schools violated federal law by considering financial need when admitting students. Some schools allegedly favored children of wealthy upbringing and preferred students who will not need financial aid when deciding on waitlisting admissions, according to the suits.

When the consensus methodology is applied in joint collaboration, according to the suit, price competition is drastically reduced, eliminating bidding wars and causing tuition inflation. As a result, the suit claimed that over 170,000 students were overcharged by hundreds of millions of dollars across nearly two decades.

Emory is part of six other defendants—Brown University (R.I.), California Institute of Technology, the University of Chicago, Cornell University (N.Y.), Rice University (Texas) and Yale University (Conn.)—that the suit alleges were part of the 568 group at some point over the past two decades. The lawsuit states these schools “may or may not have” adhered to need-blind admissions policies, but are still accused of conspiring with the others. 

The suit alleges that these elite, private universities are “gatekeepers to the American Dream” and have drastically increased inaccessibility to the higher education promised by their institutions. The burden falls overwhelmingly on low- and middle-income families, who commonly struggle to afford the cost of a college education, the suit states.

The plaintiffs stated they sought to compensate all “U.S. citizens or permanent residents, and purchasers of tuition, room, or board” in any of the aforementioned universities who have received financial aid, paid tuition or room and board not fully covered by aid and are enrolled in a university’s full-time undergraduate programs during the “relevant times” outlined by the lawsuit.