News & Awards

Elite Schools, Former Students Spar Over Discovery

January 18, 2023

Law360 (January 17, 2023, 8:20 PM EST) -- Admissions processes, donations tracking, scholarships, college decisions and more are on the line as discovery continues to heat up in an antitrust lawsuit from former students accusing Yale, Columbia, Duke, Emory and other top private universities of conspiring to limit financial aid.

Each side blasted the other in several filings submitted last week in the year-old Illinois federal court case claiming that the private universities worked together to eliminate financial aid as a point of competition between the schools, effectively fixing the total price of attendance for some 170,000 students over the past two decades.

The suit names Brown University, California Institute of Technology, Columbia University, Cornell University, Dartmouth College, Duke University, Emory University, Georgetown UniversityMassachusetts Institute of Technology, Northwestern University, University of Chicago, University of Notre Dame, University of Pennsylvania, Vanderbilt University, William Marsh Rice University and Yale University. An amended complaint in February added Johns Hopkins University.

At the center of the case and much of the overlapping discovery disputes is Section 568 of the Improving America's Schools Act of 1994, which conveys antitrust immunity for schools coordinating admissions — provided all students are admitted on a "need-blind basis" without considering finances — and the alleged price-fixing cartel that the former students say the schools formed with a 568 Presidents Group under which they agreed to implement a common approach to evaluating an applicant's ability to pay for school and for using that calculation when making admission decisions.

According to last week's filings, Brown, Columbia, Dartmouth, Northwestern, Notre Dame and Yale have all sworn off claiming immunity from the suit under Section 568 — immunity U.S. District Judge Matthew Kennelly rejected in an August decision refusing to dismiss the suit. The schools argue that in doing so, they have eliminated any need for plaintiffs to get discovery "related to admissions and development activities" from them.

"Withdrawal of this defense should have been welcome news to plaintiffs: it significantly narrows the disputed issues, reduces the burden and expense for both plaintiffs and the moving defendants, and allows these parties to focus on the antitrust issues that form the gravamen of plaintiffs' case," the six schools said in a motion Saturday seeking a protective order against such discovery.

But instead of dropping or at least limiting that discovery for the six schools, they argued the former students doubled down with "extensive" demands, "revealing that plaintiffs' goal in pursuing such discovery is to harass and embarrass, rather than because it is relevant to their actual antitrust claim."

Another set of schools — Brown, Chicago, Emory, Penn and Vanderbilt — want to at least limit discovery from their files by arguing they withdrew from the 568 group, according to a lengthy joint status report filed Friday.

"Plaintiffs assert that the non-member schools 'refuse to search for or produce documents beyond the date of their alleged withdrawal.' ... That is unequivocally false," all 17 schools said in the report.

"Each of the non-members has agreed to provide post-membership discovery on myriad relevant topics, including their lack of participation in the 568 group post-membership and their financial-aid practices post-membership," they continued. "They simply oppose sweeping discovery into their post-membership admissions practices, for the straightforward reason that admissions evidence is relevant only to the 568 exemption's applicability and they do not invoke the 568 exemption as a defense for any post-membership liability they may have."

The plaintiffs blasted both efforts to limit their discovery, in one of several broadsides against the schools found in their half of the status report.

Targeting the schools that say they have withdrawn from the cartel, the plaintiffs argued that parties who actually warrant credit for leaving an antitrust conspiracy must "disavow or repudiate the conspiracy and its goals." But here, the withdrawal letters "praised the conspiracy and wished it continued success in the future," according to the plaintiffs.

"Plaintiffs have further explained to defendants in writing ... that, absent conclusive proof of withdrawal and disavowal or repudiation of the conspiracy and the goals of the conspiracy, these defendants remained a part of the conspiracy, and thus remained liable for the acts and omissions of each other member of the conspiracy — and vice versa," they said. "There can be no silo of immunity from liability when one is in a conspiracy."

More broadly, the plaintiffs said that 16 out of 17 schools have refused to name custodians in their development offices for searches, while at least 11 of the schools have balked at naming someone in their president's office. They argue that only through those offices can they see whether admissions decisions were made from the very top and if donations influenced the process.

The schools responded that those searches amount to looking for a needle in a haystack on top of the "tens of millions of documents" already collected from custodians in places like admissions offices.

"It would be more efficient for plaintiffs to review the documents and data from those sources before defendants spend additional time and resources sifting through voluminous information that likely has no bearing on this case," the schools said.

Separately, the schools have accused the plaintiffs — who are also seeking a protective order barring subpoenas on their parents — of their own discovery failures.

In a separate motion to compel filed Friday, the schools argued the former students "have offered no legitimate basis for their refusal to participate meaningfully in discovery," discovery seeking information about financial aid offers the plaintiffs received, alternative methodologies the plaintiffs think the schools should have used to calculate aid, how they paid for school, and the process through which the students decided where to attend "which are relevant to plaintiffs' hyper-narrow alleged market."

"Plaintiffs' resistance to providing the requested information is particularly indefensible given their demand for billions in damages," the schools said.

Counsel for the parties did not immediately respond late Tuesday to press inquiries.

The students are represented by Kyle W. Roche, Edward Normand, Eric Rosen and Peter Bach-y-Rita of Roche Freedman LLP, Robert D. Gilbert and Elpidio Villarreal of Gilbert Litigators & Counselors PC, Eric L. Cramer, Caitlin Coslett, Robert E. Litan and Daniel J. Walker of Berger Montague PC, and Elizabeth A. Fegan of Fegan Scott LLC.

Brown is represented by Morgan Lewis & Bockius LLP. CalTech is represented by Cooley LLP. The University of Chicago is represented by Arnold & Porter. Columbia is represented by Skadden Arps Slate Meagher & Flom LLP. Cornell and Rice are represented by King & Spalding LLP. Dartmouth is represented by Jenner & Block LLP. Duke is represented by Covington & Burling LLPGibson Dunn & Crutcher LLP and Saul Ewing Arnstein & Lehr LLP. Emory is represented by Jones Day. Georgetown is represented by Mayer Brown LLP. Johns Hopkins is represented by Ropes & Gray LLP. MIT is represented by Freshfields Bruckhaus Deringer LLP and Goldman Ismail Tomaselli Brennan & Baum LLP. Northwestern is represented by Sidley Austin LLP. Notre Dame is represented by Williams & Connolly LLP and Michael Best & Friedrich LLP. The University of Pennsylvania is represented by WilmerHale and Miller Shakman Levine & Feldman LLP. Vanderbilt is represented by White & Case LLP. Yale is represented by Hogan Lovells US LLP and Novack & Macey LLP.

The case is Henry et al. v. Brown University et al., case number 1:22-cv-00125, in the U.S. District Court for the Northern District of Illinois.

--Additional reporting by Kelly Lienhard and Matthew Perlman. Editing by Vaqas Asghar.