Federal Lawsuit Against Top US Universities Over Alleged Collusion

Yale University, along with 15 other prestigious U.S. institutions, faces a federal lawsuit accusing them of violating antitrust laws through financial aid collusion. The suit, filed on behalf of former students, alleges that these universities engaged in price fixing by employing a shared methodology to calculate students’ financial needs. This practice, the plaintiffs argue, suppressed competition to offer more generous aid packages while favoring wealthier applicants.

The universities are members of the 568 Presidents Group, an alliance permitted under Section 568 of the 1994 Improving America's Schools Act to collaborate on financial aid formulas. This exemption, however, applies only if admissions are “need-blind,” meaning financial circumstances should not influence decisions. The lawsuit claims that at least nine institutions, including Yale, Georgetown, and Northwestern, violated this condition by considering applicants' ability to pay in certain admissions and waitlist scenarios.

Attorney Eric Rosen, a partner at Dynamis LLP and a lead prosecutor in the Varsity Blues scandal, criticized the universities for undermining fairness, stating, “These schools conspired to use a formula that limited financial aid competition while favoring the wealthy.” The lawsuit seeks to halt these collaborations and demands damages for affected students. Lawyers estimate that more than 170,000 students over the past 18 years could join the suit, potentially exposing schools to significant financial liability.

The allegations strike at the heart of these institutions’ claims of promoting meritocracy, sparking a critical debate about equity in higher education. If the plaintiffs prevail, the case could redefine financial aid practices and challenge the legitimacy of longstanding policies that prioritize institutional wealth over student access and opportunity.