5 days ago
Northwestern, UChicago named in lawsuit claiming university early decision agreements are anticompetitve
The University of Chicago and Northwestern University are both named in a lawsuit accusing top U.S. colleges of using the popular early admissions process to inflate tuition costs.
The class-action lawsuit accuses 32 elite U.S. schools of violating antitrust laws. Five of the eight Ivy League universities are also named, among several others.
The universities named in the lawsuit all use the Common app and/or Scoir/the Coalition app, the lawsuit said. All the universities also are or were members of the Consortium on Financing Higher Education.
The plaintiffs claim students who commit to a school early are prevented from receiving competitive offers from other schools, and are locked into tuition and financial aid agreements.
This is despite the fact that a prospective student's early decision agreement with a university is not legally binding — with universities describing it as an "honor-bound agreement" with "ethical" obligations, but without legal standing, the lawsuit said.
The lawsuit said the universities benefit from early decision agreements not being legally binding — as they allow universities to revoke acceptance for students who do not finish their senior years of high school with grades commensurate with their interim transcripts, and also allow schools to change their programs of study and other terms of service without students having legal recourse.
"Without binding contracts, participating colleges are also not contractually bound to any price terms vis-à-vis admitted students and can charge the tuition they deem appropriate, or offer any student financial aid packages they deem appropriate without facing legal claims that implied financial terms were violated," the lawsuit said.
Nevertheless, students who enter early decision agreements are essentially bound to the schools that offered them, the lawsuit said.
The lawsuit called early decision agreements anticompetitive.
"A school has no legal, moral, academic, or self-interest-based reason not to compete for students offered admission at other schools through Early Decision, any more than it does to refrain from competing for students offered admission by other schools through the regular admissions process," the lawsuit said. "Yet the Defendant Schools have mutually agreed not to compete for students accepted through Early Decision, which both raises prices for tuition and other services and entrenches a system widely acknowledged to be unfair and harmful."
The suit seeks to end the early admissions practice.
CBS News Chicago has reached out to both Northwestern and UChicago for comment.
