August 16th 2023.
The University of Chicago has settled a class action lawsuit brought by former and current students. These students accused the school and 16 others of participating in a ‘cartel’ to restrict financial aid packages. U.S. District Judge Matthew Kennelly is set to validate the settlement, which will see the University of Chicago pay the students a $13.5 million settlement.
The University of Chicago denied the allegations in a written statement, saying that the claims were “without merit”. The school’s spokesperson also stated that the University of Chicago is committed to removing financial barriers for its admitted students and is proud of the financial aid packages it offers.
The other 16 schools named in the lawsuit include Columbia, Cornell, Duke, Georgetown, MIT, Northwestern, Notre Dame, Penn, Rice, Vanderbilt, Yale, Brown, Dartmouth, Emory, Caltech, and Johns Hopkins. It is believed that the 17 institutions have been artificially inflating tuition for more than 170,000 students over the past two decades.
The lawsuit, which was filed early last year, alleged that the schools, which were part of the now-dissolved 568 Presidents Group, had incorporated a shared methodology to calculate the students’ financial needs for the past 20 years. The lawsuit declared that the 568 Cartel was “explicitly aimed to reduce or eliminate price competition among its members” and that the net price of attendance for financial-aid recipients at the defendants’ schools had been “artificially inflated”.
Following the suit being filed, the 568 Presidents Group has been discontinued. The University of Chicago has agreed to provide documents and other information to the plaintiffs to show the school’s financial aid practices, and will be the first of the 17 accused to settle.
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