Payments Begin in Major Settlement for College Students
College students will soon receive their initial payments from a substantial $284 million settlement involving some of the country’s most prestigious universities. These institutions were accused, in a 2022 federal class action lawsuit, of conspiring to manipulate financial aid.
The lawsuit claimed that 17 elite universities participated in what was termed a “price-fixing cartel,” which reduced financial aid packages for students and, in a sense, led to students being overcharged by “at least hundreds of millions of dollars.”
As of now, ten of the implicated schools have come forward to agree to settlements. Notable institutions in this group include the University of Chicago, Emory University, Yale University, and Duke University, among others.
Additionally, other defendants in this case included the California Institute of Technology, Cornell University, and Johns Hopkins University. However, it’s important to note that none of these universities have admitted to any wrongdoing.
Electronic payments started being sent out to students who filed claims on Monday, and physical checks are set to be mailed out by Friday.
Current and former students from the 17 schools involved in the lawsuit can expect to receive, on average, around $2,000. The final amounts may vary based on several factors, such as how many of the estimated 200,000 class members file claims and the net tuition fees of the schools they attended.
The application window for claiming this settlement has closed, meaning those who missed it won’t be receiving any benefits. Eligible students included attendees from schools like Chicago, Yale, and MIT, particularly those who enrolled in certain fall semesters between 2003 and 2021.
According to the lawsuit, the implicated schools reportedly convened annually to discuss financial aid calculations, negatively impacting the aid available to students. This alleged collusion is said to contravene Section 568 of the American School Act of 1994, which allows for certain collaborations among colleges but prohibits consideration of applicants’ financial needs in admissions decisions.
