Judge throws out scholarships suit, allows its refiling

In an apparent victory for the University, a Common Pleas Court judge has dismissed a coalition's class-action lawsuit against the University over the number of Mayor's Scholarships required by a disputed city ordinance. Judge Nelson Diaz dismissed the suit yesterday because the plaintiffs failed to name the city and the mayor as co-defendants with the University. He noted that a 1977 ordinance at the heart of the dispute is a contract between the city and the University. But Diaz gave the plaintiffs 20 days to file an amended suit adding the city and mayor as defendants. The move indicates that the legal battle being waged against the University by several individuals and a dozen organizations is not yet over. Thomas Gilhool, a lawyer for the Public Interest Law Center of Philadelphia -- which is representing the plaintiffs -- said yesterday that the unions, student groups and individuals would "promptly" add the city and the mayor as defendants in an amended suit. Attempting to cast the dismissal in a bright light, Gilhool called the judge's order "a welcome development to get all the public officials into the scrutiny of the courtroom." University General Counsel Shelley Green would not call the dismissal a victory, but said that "it's certainly not a defeat for the University. We're pleased with the decision." Arthur Makadon, lawyer for the University, said that Diaz's ruling indicates that the "whole process will start all over again," adding that the University would wait to see the amended suit before deciding how to respond this time. "The ruling does not change the University's legal position, nor does it change the city's legal position," Makadon said. "We're going to make the argument again that this is a matter between the city and the University." The city, led by Mayor Edward Rendell, has come out publicly in support of the University in the dispute. Rendell's chief legal advisor, Judith Harris, concluded in February that the University's interpretation of the 1977 ordinance is correct. Based on Harris's opinion, Rendell announced the city would not join the plaintiffs in suing the University. Former Mayor Wilson Goode had been preparing to join the suit late last year, when Rendell asked him to hold off on the move. David Cohen, Rendell's chief of staff, said yesterday that the city still supports the University on the scholarship issue and predicted that the "borderline frivolous" suit would be thrown out permanently once the judge considers its merits. "The city will continue to take the position that [the city is] honoring the agreement," he said. "And given that both parties are in agreement, I think the court is going to have a lot of difficulty figuring out what it's adjudicating." Diaz's ruling came one day after lawyers in the case delivered oral arguments at an hour-long hearing on the University's preliminary motions to dismiss the suit. The hearing focused on the University's claim that the plaintiffs lack legal standing to sue the University over an agreement solely between the city and the University. But while Diaz wrote in his dismissal that he had "sustained" the University's preliminary objections, lawyers on both sides agreed that the judge did not appear to base his decision on the issue of standing. Gilhool said he believes the judge's decision to focus on the make-up of the defendants reflects the University's failure to prevail on "any of the many preliminary objections [Makadon] raised," including the plaintiffs' legal standing. But Makadon disputed Gilhool's assertion, saying that Diaz had no need to find an additional reason to dismiss the suit and that the issue of standing "will have to be addressed" at some future time. Plaintiffs in the suit argue that the ordinance requires the University to award Philadelphia high school students 125 new scholarships each year, or 500 at any one time. The University maintains the ordinance requires only 125 awards at a time. In a statement released yesterday, President Sheldon Hackney said, "We are pleased by the judge's ruling." But he added that University officials "have always seen this issue in a broader context." Hackney said that "our real challenge is not winning a lawsuit, but raising the community's awareness of the University's commitment to Philadelphia, including the . . . financial aid we have provided for more than 100 years to qualified Philadelphia students."

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