May 21, 2020Client Alert

Institutions of Higher Education Face an Onslaught of Pandemic-Related Class Action Lawsuits

As institutions of higher education continue to respond to the COVID-19 pandemic, an additional legal concern has been added to this already challenging environment: class action lawsuits by students demanding repayment of tuition and fees. With more than 85 pending class action lawsuits filed since March 2020, it seems foreseeable that even more institutions of higher education will face some similar legal challenge in state and federal court.

While each lawsuit is unique to the facts and circumstances of the defendant institution, the actions filed to date generally seek refund of tuition and fees (including room and board payments) for the portion of the Spring 2020 semester affected by the pandemic. For most institutions, this is marked by campus closures and the transition to online learning.

These lawsuits share a number of common themes:

  • Breach of Contract: Plaintiffs assert that the defendant institutions have failed to provide contracted-for services in exchange for tuition and fees (including room and board payments). They assert that, by virtue of paying tuition and fees for the Spring 2020 semester, they are entitled to in-person instruction, housing, educational facilities, and other services. Some cases have pointed to what institutions charge for in-person classes compared to the lower costs of online instruction as support for their claims.
  • Unjust Enrichment: Plaintiffs allege that the defendant institutions have unlawfully retained tuition and fees for the Spring 2020 semester even though they have failed to provide the education, experience, and/or services for which this money was collected. The lawsuits claim that online classes do not have equal value to in-person classes and, as a result, students overpaid and are entitled to damages.  The claims also allege that students are entitled to a return of any “unused” fees they paid, including fees paid for: meal plans; room and board; recreation; health services; and campus life.   
  • Conversion: Plaintiffs allege that, by virtue of paying tuition and fees for the Spring 2020 semester, they have an ownership right to the in-person instruction, housing, educational facilities, and services that they were to be provided.
  • Class Certification: Most of these lawsuits have been filed by a single plaintiff who seeks to represent a class of individuals who paid tuition and fees for the Spring 2020 semester. While each lawsuit defines the purported class (and, often, sub-classes) differently, some allege that up to tens of thousands of individuals belong to a given class.

Although each college and university’s response to pandemic-related class action litigation depends on a number of institution-specific factors, most institutions have a number of viable defenses to such claims. These defenses include, but certainly are not limited to:

  • Contract Fulfillment: In most cases, the first hurdle plaintiffs will face is the likely absence of a specific document mandating in-person instruction. Moreover, despite the pandemic, most institutions of higher education successfully transitioned to online learning. While classes have not been conducted in-person, students have received meaningful instruction under   rigorous standards, been allowed to complete their coursework, and received academic credit for successfully completing their coursework.  Moreover, the assumption of “unjust enrichment claims,” i.e., that institutions are saving money by not having students on campus – is highly inaccurate.  Institutions are facing significant financial hardship due to the pandemic.
  • Impossibility or Impracticability: In general, institutions of higher education did not voluntarily close campus and transition to online learning. Rather, these decisions were dictated by the threat of the COVID-19 pandemic, declaration of state or national emergency, and state or local orders requiring school closures. It would have been impossible to deliver in-person instruction, housing, educational facilities, and services to students under these conditions.
  • Public Policy: The health risks associated with continuing in-person instruction, housing, educational facilities, and services to students during the pandemic would have jeopardized their health and safety, as well as the health and safety of faculty, staff, and the community at large.
  • Unsuitable for Class Certification: Although campus closures and the transition to online learning have affected large groups of students, how this has affected a particular student is a highly individualized analysis. Class actions require large groups who have suffered the same injury at the hands of the defendant. Here, plaintiffs might be in very different situations. The value of online versus in-person learning depends on a particular student’s course of study, learning style, intellectual aptitude, and a variety of other factors. Attempts  might be made to create different subclasses within the class action, but this strategy comes with its own problems. Given this, strong defenses remain available to fight certification and, without a class, these cases become much less viable and profitable for plaintiffs’ counsel.

With proper guidance and counsel, we believe that many institutions of higher education can successfully defend against pandemic-related class action lawsuits. Michael Best will continue to track the status of these lawsuits and provide guidance to its clients in preparing for and defending against these claims.

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