A federal judge has denied a motion that would have dismissed an antitrust lawsuit against 17 elite universities, including the University of Chicago. The initial lawsuit was filed in January 2022 and alleged that a group of universities coordinated the amounts of financial aid they offered.

According to the Amended Class Action Complaint, the plaintiffs allege that the defendants have “participated and are participating in a price-fixing cartel that is designed to reduce or eliminate financial aid as a locus of competition, and [have] artificially inflated the net price of attendance for students receiving financial aid.”

The universities argue that they are exempt from antitrust laws because of the 568 Exemption. The 568 Exemption creates an exception to the Sherman Antitrust Act, which allows universities to collaborate on financial aid package formulas–which would otherwise be illegal–if students are admitted on a need-blind basis. A group of universities that qualify for the 568 Exemption, such as Yale University and Columbia University, are members of an interest group known as the 568 Presidents Group.

The members of the Group produced a formula–the “Consensus Methodology”–which would cap financial aid awards at a certain value, meaning that students seeking aid would receive similar offers from multiple universities. This tactic, the plaintiffs argue, has inflated the price of attending university across the country and overcharged students millions of dollars.

The Plaintiffs argue that the Group’s members have violated the 568 Exemption and fail to admit students on a truly need-blind basis by favoring the students of wealthy families in the admissions process. On August 15, 2022, the court determined that the Group members were not protected by the exemption and are still liable to the suit alleged against them.

The University of Chicago had filed a separate motion against the lawsuit on the basis that it had withdrawn from the 568 Group in 2014. U.S District Judge Matthew F. Kennelly’s opinion also denied this motion.

“The Court concludes that [Chicago is] not entitled to the dismissal of the claims made against [it], as the complaint does not establish their withdrawal from the claimed conspiracy,” wrote Kennelly, “The amended complaint states that some of the defendants have claimed to withdraw, but this does not amount to a concession that they did, in fact, withdraw.”

Kennelly wrote that the University must “take affirmative acts to disavow the conspiracy and its goals” in order to truly withdraw from the 568 Group.

The antitrust exemption was part of the Improving America’s Schools Act of 1994 and expired on September 30, 2022. The universities that were part of the exemption are now required to abide by the same antitrust laws that outlaw price fixing.

“Congress rightly concluded that the Section 568 antitrust exemption should not be renewed. Defendant universities never complied with the congressional mandate that they be need-blind regarding all students and all families in admitting students. Instead, for decades they exploited the exemption to favor wealthy applicants and families, and to disfavor applicants from middle and working-class families,” Robert D. Gilbert of Gilbert Litigators & Counselors of the Plaintiffs’ Counsel commented to the Maroon, “Moreover, by agreeing not to compete, they overcharged these applicants and families, and forced them to bear unnecessarily high debt. Now defendants do not have any excuse for their collusion, which must end.”

Students who feel they did not receive an appropriate financial aid package from any of the 568 Group universities can get in touch with attorneys representing the plaintiffs through this website.