Proposed $284 Million Settlements for Financial Aid Violations
Understanding the Proposed Settlements in Financial Aid Class Action
If you were enrolled in a full-time undergraduate program and received financial aid at any time between 2003 and 2024, a class action settlement totaling $284 million may affect your legal rights.
A federal court has authorized a preliminary approval of proposed settlements involving the California Institute of Technology and Johns Hopkins University. These settlements pertain to a class action lawsuit focused on antitrust violations related to financial aid distribution among these institutions and others.
The Background of the Class Action Lawsuit
This class action lawsuit arose from allegations by students that several universities conspired to limit the financial aid offered to those attending their institutions. The plaintiffs claim that this conspiracy violated federal antitrust laws, which are designed to promote competition and fairness in the marketplace.
The universities involved in this case are: Brown University, California Institute of Technology, University of Chicago, Columbia University, Cornell University, Dartmouth College, Duke University, Emory University, Georgetown University, Johns Hopkins University, Massachusetts Institute of Technology, Northwestern University, University of Notre Dame, University of Pennsylvania, Rice University, Vanderbilt University, and Yale University.
The Financial Terms of the Settlements
As part of the settlements, it has been agreed that California Institute of Technology will contribute $16,750,000, while Johns Hopkins University will pay $18,500,000. Combined, these payments build a Settlement Fund of $35.25 million for the benefit of the settlement class.
Importantly, these new settlements add to the existing $284 million in prior settlements that were approved by the court. Current class members are entitled to receive payments if they do not opt-out of the settlements by the specified cutoff date and submit a timely claim.
Eligibility Criteria for Payments
Eligibility for payouts from the settlement fund requires that you be a U.S. citizen or permanent resident who enrolled in the undergraduate programs of the defendant colleges and received some need-based financial aid. Additionally, you must have directly purchased tuition, fees, room, or board that was not fully covered by any financial aid received during the class period.
The guidelines set forth specific eligibility windows for different institutions, culminating on February 28, 2024, for many institutions involved.
Claim Submission Process
Settlement class members will be required to submit valid claims to access funds from the settlement. Following approval from the court, a claims administrator will distribute claim forms to eligible members of the class.
If you have questions or need further assistance, you can reach the claims administrator by phone or email, and they can guide you through the process.
Potential Outcomes and Award Variability
While settlement payouts are anticipated, the actual amounts could vary depending on several factors. If around half of the estimated 200,000 class members submit claims, average payouts could be around $250, although this is subject to alteration based on updates in the claims process.
Next Steps and Fairness Hearing Information
A Fairness Hearing is scheduled for June 20, 2025, where the court will assess the fairness of these settlements and decide on final approval, attorney fees, and any objections raised by class members.
This hearing will be particularly crucial, as the court will evaluate whether the proposed settlements serve the interests of all affected students.
Frequently Asked Questions
1. Who can participate in the settlement?
Individuals enrolled at participating universities and who received need-based financial aid are eligible for claims.
2. How much can I expect to receive?
Settlements will likely yield average payouts around $250, depending on the number of claims submitted.
3. What is the deadline for submitting claims?
Class members must submit their claims before the established cutoff date, which will be communicated once the claims process opens.
4. Can I opt out of the settlement?
Yes, class members may opt out of the settlement by the specified deadline.
5. What happens if I do nothing?
If you do not take action, you remain legally bound to the settlement terms and relinquish your claims.
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