Following up on my previous posts (links below): Law.com, Class Action Alleging USC Fraudulently Inflated US News Ranking Removed to Federal Court:
The University of Southern California and education consultant 2U Inc. removed a class action lawsuit alleging fraud to federal court Wednesday, the second lawsuit filed against USC after the first was filed in December. …
In March 2022, USC surprised many when it removed its Rossier School of Education from the world-renowned U.S. News & World Report’s ranking of graduate schools of education. The ranking is widely known as the “single most referenced source of school prestige and academic standing that prospective students consult when selecting a school,” according to the complaint.
USC allegedly capitalized on this platform by inflating its ranking to draw more attention to its graduate program, for theirs and 2U’s financial benefit. An internal investigation by USC counsel Jones Day revealed the extent of the two companies’ “aiding and abetting each other” in this alleged scheme.
The defendants together “aggressively advertised USC Rossier’s fraudulent rankings to grow enrollment in the school’s online programs,” according to plaintiffs Iola Favell, Sue Zarnowski, and Mariah Cummings, who argue that they relied heavily on the school’s U.S. News rankings in deciding to apply. …
According to the complaint, USC hired 2U to run advertising and recruiting for their online graduate programs. 2U would reportedly receive 60% of all tuition revenues, while USC received 40%, the complaint said.
“This arrangement may be illegal; under most circumstances, federal regulations prohibit institutions from compensating recruiters based on enrollment, in recognition of the fraud that often occurs when financial motivatio
TaxProf Blog coverage:
- USC Pulls Ed School Out Of U.S. News Graduate School Rankings; Jones Day Is Investigating 5 Years Of Inaccurate Data (Mar. 24, 2022)
- Jones Day Finds USC Dean Intentionally Reported False Data To U.S. News To Goose Its Ranking (Apr. 30, 2022)
- After Submitting False Data To U.S. News For 9 Years, USC Ordered To Certify Accuracy Of Its Data In Future Rankings (June 11, 2022)
- Students Sue USC For Reporting False Data To U.S. News To Goose Its Ranking (Dec. 21, 2022)
