COVID-19 Tuition Refund Class Actions Against Colleges and Universities (May 8, 2020 Update)

May 08, 2020

This is our second update on higher ed refund class actions following our April 22 webinar, "COVID-19 Tuition Refund Class Actions Against Colleges and Universities." At that time, approximately 10 putative class actions had been filed, and three weeks later, there are now more than seventy. A tracking chart of the lawsuits of which we are currently aware can be found at the link at the bottom of this email. Here are five key takeaways from the latest phase of this fast-moving litigation that we hope will be helpful to you and your team: 

  1. Schools should prepare for the filing of an MDL petition. The typical playbook of the plaintiffs’ counsel who have filed these claims is to file a critical mass of suits in a variety of federal courts around the country and then file an MDL petition. Notably, DiCello Levitt, one of the firms that has filed several tuition refund class actions, has already filed an MDL petition in another COVID-19 litigation involving business interruption insurance. An MDL petition is likely not too far around the corner for these cases, and schools should prepare a strategy for responding when it is filed. 

  2. Peripheral firms are getting involved. While the majority of the litigation is being filed by the same five firms identified in our last update, tuition refund class actions are now also being filed by additional firms bringing one-off lawsuits. This suggests that local plaintiffs’ attorneys are angling to be the first ones to sue the schools in their jurisdiction and view this as a promising litigation.

  3. There is increased media attention to the litigation. The tuition refund litigation continues to feature prominently in press coverage and has been featured in several segments on network TV. In light of the close media attention being paid to these cases, it will be critical for schools to have a public relations strategy that is sensitive to student concerns and coordinated with litigation positions, external messaging, business operations, and industry-wide concerns. 

  4. Pre-suit actions can have an outsized effect on any litigation. If your institution has not yet been sued, now, not later, is the time to act to have the greatest effect on any claims that may be coming. Careful planning with counsel at this stage can lay the groundwork for effective merits defenses and for individualized issues that will be critical to defeating class certification.

  5. Coordination is still (still) key. As the litigation balloons and an MDL petition grows more likely, the key strategic questions in this litigation are likely to be national, rather than local, in scope. It is imperative that higher ed defendants be more coordinated than the plaintiffs’ bar—for shared resources, litigation strategy, early precedents, public relations, and many other issues. And litigation coordination between aligned institutional defendants brings the additional benefits of privilege protection and immunity from antitrust liability under the Noerr-Pennington doctrine. 
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These putative class actions present significant challenges for colleges and universities. We will continue to monitor these actions and hope to periodically share our thoughts, which we hope will be helpful to you and your institutions in these difficult times. If we can be of assistance, please reach out.