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Can I Sue a University or Online College for False Promises?

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Yes, you may be able to sue a university or college for making false promises under two different legal theories:

  • Fraudulent misrepresentation: If you can show that they intentionally or recklessly lied to you, you may be able to sue them for fraudulent misrepresentation.
  • Breach of contract: If you can't show fraudulent misrepresentation, but can still show that they failed to keep the promises they made, you may be able to sue them for breach of contract.

Education law cases based on fraud and breach of contract can get complicated. And schools will have lawyers on their side in court. You should strongly consider consulting with a law firm and getting legal advice about whether you might have a case worth pursuing before trying to sue a school on your own.

College Recruiters Say the Darndest Things

College attendance dropped during the coronavirus pandemic. And it was declining beforehand. According to the New York Times, we are experiencing an “enrollment crisis." Far fewer people are seeking bachelor's degrees nowadays, either in-person or online.

Schools of higher education are actively competing to get students. Some school recruiters even have student quotas. As part of their business practices, they may make all sorts of promises to a prospective student:

  • Complete your degree within four years
  • Get a great job with your degree or certification
  • Get federal financial aid on great terms so you can easily pay back your loans
  • Be taught by the top experts in the field
  • Get a quality education from a school with accreditation

The school has a great website, sends you glossy brochures, has recruiters come to your house, and generally paints a rosy picture about what a wonderful life you can expect once you've graduated with a degree from their institution.

Say you rely on those promises and enroll. But it turns out, they lied. Four years later you graduate with a worthless degree and a huge amount of student debt you can never pay back. Is there anything you can do?

You may be able to sue them for their false promises under two different legal theories: fraudulent misrepresentation and breach of contract.

Fraudulent Misrepresentation

Let's start with fraudulent misrepresentation. To make a claim for fraudulent misrepresentation, you need to prove six elements:

  • The school made a representation (a material statement of fact)
  • The representation was false
  • When made, the school either knew the statement was false or made it recklessly without knowing whether it was true
  • The school intended you to rely on the representation
  • You did, in fact, rely on the representation
  • You suffered damages as a result of relying on the representation

If you have evidence proving these elements, you may be able to win your court case.

There are two particular challenges to a fraudulent misrepresentation lawsuit against a school of higher education: proving that the school made a material statement of fact and that they knew it was false or acted recklessly.

Material Statement of Fact

The first is proving the school made a representation you can sue for. The representation must be of fact. You can't sue about an opinion.

For example, suppose the school website and handbooks say that they have “the best English program around." That something is the “best" isn't a fact. No matter how many people may agree with them, it's just an opinion. You would not be able to sue them for that statement, even if it turns out that they actually have the worst English program in the country.

The representation must also be material. This requires you to show that a reasonable person would have found the representation important enough to have acted upon it. A promise that you will be receiving $10,000 in scholarships is material; a promise that the football team will win the NCAA championship probably isn't.

Intent

The second challenge is proving what's called intent. You must show that at the time the promise was made, the school knew it was false or made it recklessly without knowing if it were true or false.

The timing is critical. It's not enough to show that the promise later turned out to be false. The focus is on the time the statement was made, not the time you may have relied upon it.

Breach of Contract

Let's now turn to the second claim — breach of contract. As you will see, a breach of contract claim is similar to a fraudulent misrepresentation claim except that you do not need to prove intent or recklessness.

We will start with what a contract is. A contract is a legally enforceable agreement between at least two competent parties. To have a valid contract, you need to be able to show:

  • Offer
  • Acceptance
  • Consideration

Offer

An offer is a promise to do or not to do something in exchange for something else. An example might be, “Come to our school and we will give you a $10,000 scholarship." A reasonable person would believe that you would get the money if you went to the school, so a court would likely find that the statement is an offer to enter into a binding agreement.

Acceptance

Acceptance is assent to the terms of the offer. Simple as that. You don't have to use magic words. You can either say or do something that shows a reasonable person that you agree.

Using the offer above as an example, acceptance might simply be you saying “okay." Another way you could show you agree to the terms is if you, without saying anything, went to the school. That action would imply an intent to enter into a legally binding agreement and thus constitutes acceptance.

Consideration

Offer and acceptance are pretty straightforward. Consideration is a little harder to grasp.

Consideration is a bargained-for exchange of something of value. It can be money, but it doesn't have to be. It can be a promise to do or not to do something,

In our example, the bargained-for exchange is school for the scholarship. The exchange has value. A court would find that the exchange is adequate consideration and that you have a valid contract.

Remedies

If you can prove your fraudulent misrepresentation or your breach of contract claim, you would be able to recover damages. Your recovery would be designed to put you in the position you would be in if you hadn't acted on the false promise. Most likely, you would get your money back.

You Wouldn't Be First to Sue A University or Online College

There are many cases of people suing universities and online colleges for false promises. Here are a couple of particularly interesting, high-profile ones.

Ashford University

The first involves Ashford University, an online for-profit institution, and its parent company, Zovio (formerly Bridgepoint Education). Then California's attorney general, Xavier Becerra, brought an action on behalf of students for making false promises about:

  • Career outcomes
  • Cost and financial aid
  • The pace of degree programs
  • Transfer credits

The reason Ashford made these promises was to induce students to enroll. The San Diego Superior Court found that Ashford and Zovio violated the law and ordered them to pay more than $22 million.

Ashford is by no means unique. There are many examples of government lawsuits against other universities and online colleges on the U. S. Department of Education's website.

Trump University

The second case involves the storied Trump University, which was formed by the former president in 2004. Trump University ran a real estate training program from 2005 through 2010. It ceased operations in 2011 amidst several lawsuits and investigations over false advertising and racketeering.

In one of those lawsuits, a group of university students sued Trump for fraud. They claimed that the school lied about being a “university" when it lacked accreditation and by claiming that Trump “hand-picked" instructors when in fact he didn't. The students ended up getting a $25 million settlement

If You Believe You Have a Claim, Contact an Attorney

With college enrollment on the decline, schools of higher education struggle to convince college students to enroll. They may say all sorts of things to get you to sign up. You may end up getting burned if you rely on some of those statements.

If you believe a university or online college lied to you, you may be able to sue for fraudulent misrepresentation or for breach of contract. Cases against educational institutions can get complicated, so consider consulting an attorney who is experienced in education law. They can advise you of your legal rights and make sure that your interests are protected.

Next Steps

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