A PYMNTS Company

Judge Dismisses Tuition Collusion Case Against 40 Elite US Universities

By  |  September 28, 2025
University

A U.S. federal judge has dismissed a lawsuit accusing dozens of elite private universities of colluding to inflate tuition costs by factoring in the assets of noncustodial parents when determining student financial aid. According to Reuters, U.S. District Judge Sara Ellis in Illinois ruled that the plaintiffs had not plausibly shown an agreement among the schools, which include Northwestern, Harvard, Yale, Dartmouth, Cornell, and Georgetown.

    Get the Full Story

    Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

    Subscribe to our daily newsletter, PYMNTS Today.

    By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions.

    The case, filed by a Boston University student and a Cornell graduate, alleged that the universities conspired to make education more expensive for thousands of students. Ellis dismissed the lawsuit without prejudice, meaning the plaintiffs may attempt to refile with additional evidence, per Reuters.

    The litigation also targeted the nonprofit College Board, which developed the financial aid formula in question. Plaintiffs argued that the College Board encouraged schools as far back as 2006 to consider the income and assets of noncustodial parents in aid calculations, a policy that plaintiffs claim forces students to pay thousands of dollars more compared with institutions that do not adopt the practice. Ellis dismissed the allegations against the College Board as well.

    We’d love to be your preferred source for news.

    Please add us to your preferred sources list so our news, data and interviews show up in your feed. Thanks!

    Add as Preferred Source

    Related: Elite US Universities Accused of Colluding to Inflate Tuition Through Early Decision Programs

    Lawyers for the students, as well as representatives of the universities involved, did not immediately provide comment, Reuters reported. The institutions have consistently denied wrongdoing. The College Board also did not respond to requests for comment.

    In their defense, the schools had argued that collecting noncustodial parent information is essential for fairly distributing limited financial aid resources. According to Reuters, the defendants emphasized that this information is critical for achieving accurate need-based assessments.

    The plaintiffs’ legal team has claimed there could be as many as 20,000 prospective class members affected by the financial aid methodology. Meanwhile, a separate but related case in Illinois federal court has accused 17 top U.S. colleges of violating a pledge not to consider students’ finances in admissions decisions. That lawsuit has already led to settlements worth hundreds of millions of dollars.

    The dismissed case is Hansen v. Northwestern University, U.S. District Court for the Northern District of Illinois, No. 1:24-cv-09667.

    Source: Reuters