Four more prestigious universities have agreed to settle a two-year-old federal class-action lawsuit accusing them of colluding to fix the amount of financial aid they offered to students.
Dartmouth College, Rice University, Northwestern University and Vanderbilt Universities will pay a total of $166 million to resolve the claims against them, according to a court filing on Friday.
Dartmouth and Rice agreed to pay $33.75 million each. Vanderbilt will pay $55 million, and Northwestern has offered $43.5 million to resolve the charges.
To date, ten of the 17 defendant schools have now agreed to settle the case, although they continue to deny the substance of the charges. The total settlement has currently reached $284 million, from which cash payments will be made to the class of affected undergraduate students. Itâs estimated that each student in the class will receive about $750 from the settlements, which still must be approved by a judge.
The seven universities that remain in the case are the California Institute of Technology, Cornell University, Georgetown University, Johns Hopkins University, the Massachusetts Institute of Technology, the University of Notre Dame and the University of Pennsylvania.
The antitrust lawsuit was filed in 2022 in Illinois federal court by several law firms representing a group of students who previously attended some of the universities.
The plaintiffs alleged the universities engaged in a price fixing scheme by sharing a methodology for how much financial aid would be awarded to prospective students. Specifically, the suit claimed the defendant universities âparticipated in a price-fixing cartel that is designed to reduce or eliminate financial aid as a locus of competition, and that in fact has artificially inflated the net price of attendance for students receiving financial aid.â
If true, that would violate Section 568 of the Improving Americaâs Schools Act of 1994, which said universities can collaborate when they develop their financial aid formulas, but only if they do not consider applicantsâ financial need in their individual admission decisions.
The suit was brought against 17 members of the so-called â568 Presidents Group,â which several years ago developed a âConsensus Methodologyâ for determining a familyâs ability to pay for college. According to the lawsuit, the group met at least annually to discuss financial aid calculations. The defendant universities are:
Brown University, California Institute of Technology, University of Chicago, Columbia University, Cornell University, Dartmouth College, Duke University, Emory University, Georgetown University, Johns Hopkins University, Massachusetts Institute of Technology, Northwestern University, University of Notre Dame, University of Pennsylvania, Rice University, Vanderbilt University, and Yale University.
Ted Normand, a lawyer for the plaintiffs, issued a statement saying, âThese new settlements will significantly increase the compensation to the class members for the harm we allege the defendantsâ cartel caused.â