Elite Colleges Accused of Conspiring to Inflate Tuition Costs

According to a proposed class-action lawsuit filed in federal court in Boston last month, a group of 32 elite U.S. colleges and universities, including Columbia, Duke, and the University of Pennsylvania, have been accused of conspiring to artificially inflate tuition costs for tens of thousands of students through the use of the "early decision" admissions process.

The lawsuit, brought by former students at Wesleyan University and two other schools, alleges that the colleges are violating antitrust laws by agreeing not to compete with each other for early decision applicants. Early decision students face earlier application deadlines but have a greater chance of acceptance, agreeing to attend the school if admitted and forfeiting offers or aid packages from other institutions.

The plaintiffs argue that this practice allows the universities to present early decision offers as legally binding, causing early decision applicants to lose choice and negotiation leverage, while regular decision applicants are left to compete for a diminished number of admission slots. The lawsuit seeks unspecified monetary damages for tuition overcharges and a ban on the use of binding early decision programs.

The 32 defendant colleges, which also include Amherst, Northwestern, the University of Chicago, and Johns Hopkins, have not yet responded to requests for comment. The Consortium on Financing Higher Education, an organization that helps facilitate information-sharing among private liberal arts schools, is also named as a defendant.