Litigation drags on in $2 billion price-fixing lawsuit against Penn

Penn is among five universities scheduled to undergo additional hearings in an ongoing financial aid antitrust lawsuit that could expose defendants to approximately $2 billion in damages.

The\ class-action lawsuit — filed in January 2022 — accuses Penn and 16 other universities of forming a “price-fixing cartel” that colluded to reduce financial aid awards and benefit wealthy students. The new hearings will further delay the trial, which was previously set to take place at the beginning of November. 

A request for comment was left with a University spokesperson. A Penn spokesperson previously wrote that the University “continues to see no merit in this lawsuit.” 

On Monday, the Seventh Circuit Court of Appeals granted the defendants’ petition to appeal the certification of a class in the lawsuit. Now, additional briefings will be required to determine if the over 220,000 students currently involved in the lawsuit compose a valid class.

The court also granted the defendants’ motion to reconsider whether the testimony of the plaintiffs’ expert was “adequately analyzed.”

In light of the court’s rulings, the plaintiffs filed a motion on Aug. 24 to suspend all pretrial deadlines.

Alongside Penn, the only universities still active in the suit are Cornell University, Georgetown University, the Massachusetts Institute of Technology, and the University of Notre Dame. 

The student plaintiffs have collected about $319 million from the 12 schools that have settled so far. Initial payments went out last month, and a second wave is due later this year.

If found responsible, the five remaining universities would pay an average of nearly $350 million each in damages. The largest settlement from a single school to date is Vanderbilt University’s $55 million payment.

Brown University, the University of Chicago, Dartmouth College, Duke University, Emory University, Northwestern University, Rice University, and Yale University are among the institutions that have already settled.

The initial 2022 suit alleged that the elite universities, as members of the 568 Presidents Group — an organization of American universities and colleges practicing need-blind admissions — exchanged “methodology” and “principles” for calculating financial aid.

The group operated under an antitrust exemption in the Improving America’s Schools Act of 1994, which allowed schools to collaborate on financial aid policy so long as they were need-blind in admissions. The lawsuit alleged that the group’s members were unlawfully collaborating under the statute because the schools were not operating with need-blind admissions. 

Penn left the group in 2020, citing the University’s need for more flexibility in offering financial aid awards to students. Since then, Penn’s financial aid policies have expanded. 

In November of 2024, Penn announced that beginning in 2025 it would no longer consider the value of the primary family home in determining financial aid eligibility, a departure from the methodology used by the 568 Group. That same year, the University announced the Quaker Commitment — which expanded financial aid to allow families earning up to $200,000 with typical assets to receive full tuition scholarships. 

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