Court Rules Massive Fraud Lawsuit May Proceed Against University of Phoenix.SACRAMENTO, Calif. -- Please replace the release with the following corrected version due to multiple revisions. The corrected release reads: COURT RULES MASSIVE FRAUD LAWSUIT MAY PROCEED AGAINST UNIVERSITY OF PHOENIX Plaintiffs' counsel announced today that U.S. District Court Judge Garland E. Burrell denied a motion by the University of Phoenix to dismiss a far-reaching lawsuit against the university for violating Federal law, the so-called incentive compensation ban. "The Higher Education Act The Higher Education Act may refer to an Act of either the Congress of the United States or of the Parliament of the United Kingdom.
"The complaint charges that the University of Phoenix defrauded the federal government of literally billions of dollars since 1997," noted plaintiffs' attorney Michael Rubin. "We are grateful that the Court ruled that the serious charges raised in the complaint will be fully litigated. It is time for University of Phoenix to return its ill-gotten profits to the Federal government, and begin abiding by the same set of rules as followed by responsible colleges and universities." Hundreds of thousands of former University of Phoenix students without degrees are obligated ob·li·gate tr.v. ob·li·gat·ed, ob·li·gat·ing, ob·li·gates 1. To bind, compel, or constrain by a social, legal, or moral tie. See Synonyms at force. 2. To cause to be grateful or indebted; oblige. to pay back high interest loans for decades. "The vast majority of these students should not have been recruited and enrolled," explained Nancy Krop, part of the plaintiffs' team of attorneys. "The complaint charges that the university urges counselors to enroll students without reviewing their transcripts to determine their academic qualifications to attend the university, which results in many students being unable to repay their loans." Background on the Litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. The University of Phoenix is the nation's largest, private, for-profit higher education higher education Study beyond the level of secondary education. Institutions of higher education include not only colleges and universities but also professional schools in such fields as law, theology, medicine, business, music, and art. institution providing educational programs for working adult students. On its website, the university promotes itself as "the largest institution of higher learning higher learning n. Education or academic accomplishment at the college or university level. in the U.S., serving approximately 300,000 students through its more than 250 campuses and learning centers across the country." The lawsuit was filed in 2003 by two enrollment counselors of the university under the False Claims Act, a statute that permits whistle-blowers to sue on behalf of the government for fraud committed against the government and share in the recovery if the suit is successful. About 80% of its students receive federal financial aid, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. government records. The University of Phoenix collects approximately $2 billion a year in taxpayer-funded federal financial aid on behalf of its students, crediting students for tuition paid. Many students who enroll at the University of Phoenix never complete their education, and many are unable to even finish the classes they signed up for. First time freshmen have a 7% program completion rate, according to a June 2005 report of the National Consumer Law Center. The lawsuit asserts that the school urges counselors to enroll students without determining their academic qualifications to attend university. The lawsuit alleges that University of Phoenix executives brag about deceiving the Federal government by creating "smoke and mirrors" so the university may "fly under the radar This article is about the magazine. For other uses, see Under the Radar (disambiguation). Under the Radar is an American magazine that bills itself as "The solution to music pollution." It features interviews with accompanying photo-shoots. " of the incentive compensation ban. In 1992, Congress enacted the Higher Education Act incentive compensation ban to stop egregious e·gre·gious adj. Conspicuously bad or offensive. See Synonyms at flagrant. [From Latin recruiting abuses leading to the enrollment of unqualified students. Congress imposed compliance with such ban as a material condition for a university to receive tax payer tax payer n → contribuyente m/f tax payer n → contribuable m/f tax payer n → contribuente funded federal financial aid designed to assist poor persons seeking higher education. When the U.S. Department of Education investigated the whistleblower whis·tle·blow·er or whis·tle-blow·er or whistle blower n. One who reveals wrongdoing within an organization to the public or to those in positions of authority: "The Pentagon's most famous whistleblower is . . charges, interviewing about 90 witnesses and reviewing University compensation documents, the Department concluded that the University of Phoenix "systematically and intentionally operates in a duplicitous manner so as to violate the Department's prohibition against incentive compensation while evading detection." The whistleblowers recently augmented their existing legal team of practitioners Nancy Krop and Daniel Bartley, with additional plaintiffs' attorneys from the three well-regarded law firms This list of the world's largest law firms by revenue is taken from The Lawyer and The American Lawyer and is ordered by 2006 revenue:[1]
Below are the recently associated counsel of record on behalf of the relators: Robert J. Nelson Lieff Cabraser Heimann & Bernstein, LLP Michael Rubin James M. Finberg Jonathan Weissglass Altshuler Berzon LLP Cliff Palefsky McGuinn, Hillsman & Palefsky, LLP Members of the press interested in receiving a copy of the Court's order, may contact Amy Yu at ayu@lchb.com |
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