An alumnus from Cornell University and Boston University filed a federal lawsuit against forty of the highest-ranked colleges in the US on Monday, accusing the institutions of colluding in a price-fixing scheme which significantly increased the cost of higher education for students with divorced or separated parents.
According to the suit, which was filed in a federal court in Illinois, at least 20,000 prospective class members have been harmed by the practice over the past 18 years across the country. Attorneys for the alum are seeking class-action status.
The lawsuit targets the CSS Profile, a form some schools use to determine a student’s financial aid qualifications, alleging that the nonprofit College Board, which administers the form, conspired with schools named in the complaint to develop a policy in 2006 that considered the assets of noncustodial parents in its calculation, with the point of denying students institutional scholarships.
Many universities, particularly private wealthy institutions, have gravitated to the CSS Profile because it offers a more detailed look at family finances than the Free Application for Federal Student Aid (the FAFSA), which only considers the custodial parent’s assets in calculating need-based financial aid.
By requiring both parents to fill out the CSS Profile, colleges could provide a falsely high estimate of what the family could afford to pay, even if only one parent provides financial support for the student, according to the complaint. Attorneys allege the College Board pushed schools to adopt the policy, maintaining that institutions should have a consistent approach to financial aid.
Eileen Chang, one of the plaintiffs in the case, said she asked Cornell University to remove her noncustodial parent, who received disability income and could not contribute to her education, from its financial aid calculation, the complaint reads. Yet the university reportedly refused and Chang’s custodial parent had to take out a Parent Plus federal loan to cover the rest of her tuition.
Maxwell Hansen, the other plaintiff in the case, said he indicated on the CSS Profile that his father would not contribute money to his education but American University still required his dad to fill out the form, which happened again when he transferred to Boston University last year. While both schools provided some financial aid, Hansen and his attorneys suspect he would have been likely to receive more if not for the requirement.
Less than half of the 270 colleges that use the CSS Profile require noncustodial parents to complete the form, according to the College Board’s website. Students may request a waiver if they are no longer in contact with the parent.
“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, managing partner and co-founder of the law firm Hagens Berman, which is representing the plaintiffs. “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.”
In a statement, the College Board said “we are confident that we will prevail in this action.”
Some of the country’s most prestigious and expensive universities are named in the complaint, including much of the Ivy League and top-ranked research institutions such as the University of Southern California, MIT, Stanford University, New York University, and more.
