The University of Rochester is named alongside 39 other elite private universities and the College Board in a new lawsuit claiming the schools illegally conspired to extend less financial aid to students with any noncustodial parents.
The federal class action lawsuit filed Oct. 7 by a Boston University student and a Cornell University alumna alleges these universities violated the Sherman Antitrust Act by colluding through the College Board to universally agree to require the financial information of applicants’ noncustodial parents, even if they did not plan to help with school costs.
UR declined to comment on the suit.
The plaintiffs allege the requirements have artificially raised prices for these students. The named schools’ average net price is about $6,200 more than the 10 schools in the top 50 private university rankings who don’t require this information, the suit states.
“The financial burden of college cannot be overstated in today’s world, and we believe our antitrust attorneys have uncovered a major influence on the rising cost of higher education,” said Steve Berman, the plaintiffs’ lead attorney, in a statement. “Those affected—mostly college applicants from divorced homes—could never have foreseen that this alleged scheme was in place, and students are left receiving less financial aid than they would in a fair market.”
The College Board oversees the CSS Profile, which is used by the defendant universities to take in applicants’ information in order to calculate their nongovernmental financial aid. Unless a waiver is granted, students must submit the financial information of their noncustodial parents.
Before 2006, the suit argues, the defendant universities took differing approaches to factoring parents’ assets into financial aid, with numerous schools focusing on the assets of parents with custody.
That year, the College Board developed the “NCP Agreed Pricing Strategy,” which would require the financial information of applicants’ noncustodial parents, and all of the defendant universities adopted it, the suit claims. At the core of the suit is its argument that these universities colluded through the College Board, whose Board of Trustees and national assemblies included (and currently include) numerous employees and representatives of the accused schools, the complaint states.
This is the second federal class action suit in recent years alleging price fixing by universities. In 2022, a similar suit was filed against 17 schools known as the 568 Presidents Group, which were exempted from certain antitrust laws under section 568 of the Improving America’s Schools Act of 1994, allowing them to discuss financial aid formulas because their need-blind admissions policies qualified them for the exemption.
The plaintiffs alleged the schools were not need-blind and that the sharing thus constituted illegal collusion. Ten of those schools have settled so far for nearly $250 million combined, and the 568 Presidents Group was dissolved in 2022.
None of Rochester’s higher education institutions were members of that group, though Cornell was.
On this new suit, a College Board spokesperson wrote that officials were “confident that we will prevail in this action and we will continue to support our member colleges.”
Justin O’Connor is a Rochester Beacon contributing writer. The Beacon welcomes comments and letters from readers who adhere to our comment policy including use of their full, real name. Submissions to the Letters page should be sent to [email protected].
When are we going to understand that universities are businesses. Businesses are established to make money. Teaching is secondary. The proof….the universities don’t care about the urban education system and the fact that it fails urban kids. The teachers union doesn’t care about urban success. They care about their salary level, their retirement and benefits. That urban kids do not get to participate at the university level is not even a concern. The money flow is paramount. Up till now there have been plenty of applications for the universities to keep them in business. With the urban failure within spitting distance of their institutions, they fail to care enough to give the urban student an opportunity to attend and escape the generational poverty cycle. Hypocrisy runs deep. There will not be a single university/college president commenting on this subject, because they are acutely aware of that fact. Semper Fi.