University of Chicago: first to settle ‘price-fixing’ case

The University of Chicago became the first of 17 elite colleges, including the University of Pennsylvania, to settle a case that accused the schools of illegally conspiring to fix financial aid packages offered to students, keeping down the amounts offered and limiting competition, writes Susan Snyder for The Philadelphia Inquirer.

The school admitted no liability in agreeing to pay US$13.5 million to settle the antitrust class-action lawsuit, according to the Wall Street Journal. The University of Pennsylvania declined to comment on Wednesday 16 August on whether it also would settle the case. “We typically don’t offer comment on litigation,” said Penn spokesperson Ron Ozio.

The lawsuit was filed in Illinois federal court in January 2022 by several former students who attended Duke, Northwestern, and Vanderbilt. In the lawsuit, students accused the colleges of participating in a “price-fixing cartel” that was “designed to reduce or eliminate financial aid as a locus of competition”. Their actions reduced the amount of financial aid they offered to admitted students and ultimately benefited students from more wealthy families, the suit said.
Full report on The Philadelphia Inquirer site