Rankings Pressure as a Motivating Force for Fraud

The Chicago Tribune has picked up on part of the University of Illinois College of Law’s audit report that many readers lament as par for the course. While it’s unknown just how common intentional fraud is at U.S. law schools, the pressure is common among law schools to improve U.S. News rankings. It is easy to see why it sometimes translates to bad behavior.

College of Law admissions dean Paul Pless revealed another motive was at play [in starting its new admissions program]. By admitting high-achieving students in their junior years, without a law school entrance exam, the students’ high GPAs would be included in the class profile but no test scores could potentially drag down the class.

As the former dean’s own words explain:

“That way, I can trap about 20 of the little bastards with high GPA’s that count and no LSAT score to count against my median. It is quite ingenious,” Pless boasted in a 2008 e-mail exchange with an acquaintance about iLEAP, the early admissions program now in its fourth year.

Schools often admit “splitters”—high GPA/low LSAT or high LSAT/low GPA—to achieve higher and higher median scores. Admissions offices are restrained by the need to report the low LSAT or GPA along with the high LSAT or GPA because each low number drags down the median. Pless’s iLEAP program is a way to get credit for the best quality of the splitters (their high GPAs) without the LSAT median sinking downwards.

A review of the investigative file shows the intense culture in which Pless worked, one focused on improving the academic credentials of the incoming classes in part as a means to improving the already well-regarded school’s ranking.

The college’s strategic plans and annual reports focused on that ranking. Pless’ salary increases were tied to it. The law dean and other top officials exchanged emails about the benefits of different combinations of test scores and GPA medians to achieve it.

While most law school administrators wouldn’t so brazenly (and sloppily – professional email communications at a public school are usually subject to open records laws) brag about the novel ways they’ve boosted medians, they all have their bag of tricks. They all know that job security is often tied to maintaining or improving those numbers.

The same pressures exist for improving employment statistics too, though far less is known about intentional changes to underlying employment data. While it’s difficult to spin poor admissions numbers without resorting to fraud, it is far easier to use misleading tactics to dress up the unimpressive reality facing most law school graduates in today’s job market. This is particularly true when the entity charged with policing law schools, the Section of Legal Education, has failed to actively investigate what admissions and career services offices are doing.

It’s odd, to put it lightly, that these pressures exist in the first place. Serious thought needs to be given to the institutional incentives that law schools face, particularly when those incentives seem to run against the interest consumers have in receiving information that’s presented in a fair and accurate manner.

As of now, there are few if any incentives to blow the whistle on unethical admissions practices. It is likely that unethical practices have spread beyond Villanova and Illinois, but they are difficult to catch. These practices would not even be uncovered at the semi-decade inquiries from the ABA site visit teams—an important event for ABA accreditation.

It seems that we may have moved beyond the presumption that all law schools are operating ethically. It’s crucial, for the sake of the schools acting ethically as the gateway to the legal profession, that the bad apples be uncovered. We hope the schools with nothing to hide step up and ask LSAC to audit the past ten years of admissions data at all ABA-approved law schools. The costs of conducting such an audit will pay dividends of restored credibility.

Illinois Admissions Data Fraud Update

The University of Illinois College of Law issued a final report today upon the conclusion of its investigation into inaccurate class profile data shared by the College of Law. We have attached the press release to the end of this post, as well as links to the final report and several statements by the University of Illinois representatives.

Not only are the law schools inolved in intentional fraud losing credibility, but so too are the law schools that do not stand up against these bad actors. All LSAC-member law schools need to demand that LSAC audit all admissions data for the past ten years.

Press Release: College of Law Student Profile Data Inquiry Complete

URBANA—The University of Illinois today issued a final report upon the conclusion of its investigation into inaccurate class profile data shared by the College of Law. The report concluded that the intentional inaccuracies were limited to six of the 10 years reviewed, that a single individual was solely responsible for these inaccuracies, and that the college lacked adequate controls to prevent, deter and detect such actions.

In addition to its findings, the report included a set of eight recommendations, including correction of the erroneous data, implementation of “best practice” processes and controls that include data monitoring, auditing and segregation of duties as well as steps to ensure a continued University culture of integrity and ethical conduct. During the course of the investigation, the college’s assistant dean of admissions was placed on administrative leave and subsequently resigned.

The investigation found that admissions decisions, including scholarship awards, appear to have been made based on the true data originally provided by the Law School Admissions Council (LSAC), the national admissions data clearinghouse. And it doesn’t appear that any students whose data were changed had any knowledge of those changes. In other words, there is no information indicating that changes to individual Law School Admission Test (LSAT) scores or the grade point average (GPA) of any students affected any admissions decisions on particular applicants to the College of Law. The 114-page report (www.uillinois.edu/our/news/2011/Law) is the culmination of an investigation that began Aug. 26 after the University Ethics Office was alerted to potential discrepancies in student profile data—median LSATs and GPAs—for the current College of Law Class of 2014 that had been posted on the college website and disseminated in emails.

Following preliminary confirmation of the discrepancies by the ethics office, the Office of University Counsel informed University President Michael J. Hogan, the Chancellor of the Urbana-Champaign campus and College of Law leadership. At Hogan’s directive, the University engaged independent outside legal counsel and forensic data analysts to assist in the inquiry. The primary investigative team consisted of the law firm Jones Day, operating under the direction of Theodore Chung, and data analysis firm Duff & Phelps, operating under the direction of Margaret Daley. The report was prepared by Jones Day and Duff & Phelps under the direction of Donna McNeely, the University’s ethics officer, and Scott Rice, the chief legal counsel for the University’s Urbana-Champaign campus.

Hogan directed that the scope of the inquiry be expanded to include 10 years of data and that it go beyond median LSAT and GPA statistics to include the college’s acceptance rates, financial aid and scholarships, bar exam passage rates, and career placement data.

The investigative team spent two months conducting interviews, forensic data analyses and review of approximately 125,000 documents. The work included exhaustive comparisons of data from LSAC and the internal data reported by the law school.

“The report is detailed, thorough, and rigorous, and demonstrates how seriously the University and campus took the initial allegation,” Hogan said. “We are committed to the reliability of data and to a culture of transparency and integrity.”

“The campus has already begun to implement the recommendations in this report,” said Phyllis Wise, vice president of the University of Illinois and chancellor of the Urbana-Champaign campus. “Additionally, we will work with each of our colleges to ensure that appropriate checks and safeguards are in place to help ensure that all current and future data are accurate, complete and verifiable.”

The investigation determined that “the College reported and/or publicly disseminated inaccurate LSAT and GPA statistics with respect to the class of 2008 and the classes of 2010 through 2014.”

In four of the years, these inaccuracies were based on changes to the LSAT scores or GPAs of individual students that were received by the college from LSAC. In two of the years, no individual data were changed, however, the class LSAT statistics reported by the college differed from the data maintained by LSAC. In all six years, statistics reported by the college were higher than the LSAT and/or GPA values supported by the true student data. College profiles of the classes of 2005, 2006, 2007, and 2009 contained no such inaccuracies.

The investigation also revealed that “the college reported and/or publicly disseminated inaccurate acceptance rate data with respect to four classes—the classes of 2008, 2012, 2013, and 2014,” according to the report. “With the exception of 2008, these inaccuracies are attributable to both over-counting the number of applicants and under-counting the number of admissions offers for these classes.”

The investigative report concluded that Paul Pless, the college’s former assistant dean for admissions and financial aid, “knowingly and intentionally” miscalculated key data. The admissions dean was placed on administrative leave Sept. 7 and resigned from the University last week. Over his seven-year tenure, Pless had the responsibility for reporting this data, and the college showed steady, and occasionally dramatic, improvement in the main factors used to gauge the academic credentials of a law school class. According to the report, data analyses and the investigative records indicate that data discrepancies were not random or the result of inadvertent errors.

“Numbers were altered specifically, and often just slightly, to meet recruitment goals and ranking targets indicating an attempt to demonstrate that the College of Law brought in an even more highly credentialed class,” said Margaret Daley of Duff & Phelps.

The investigation found no information indicating that, prior to the commencement of the investigation, any person other than Pless knew that erroneous profile data had been reported or disseminated by the college.

The University publicly disclosed the matter Sept. 9 and subsequently released corrected profile data for the class of 2014 and for the classes of 2011, 2012, and 2013. It has kept the American Bar Association (ABA), the accrediting organization for law schools, informed of developments and fully cooperated with the ABA, which appointed fact finders who visited campus for its own investigation. The University will continue to cooperate with the ABA as it concludes its investigation and reviews the University’s report. The report was submitted to the ABA today.

The University also has been in contact with the rankings staff of U.S. News & World Report.

According to the investigative report, there is no evidence of intentional misreporting in any of the other areas examined in the inquiry–financial aid and scholarships, bar passage rates and career placement data.

“On behalf of the University of Illinois College of Law, I wish to apologize to the legal-academic community, our University, our alumni, and our students, who are among this nation’s most talented and dedicated future lawyers,” said Bruce Smith, Dean of the College. “The investigation has concluded that a single individual – no longer employed by the college – was responsible for these inaccuracies. The college takes seriously the issue of data integrity and intends to implement the report’s recommendations promptly and comprehensively. As the report properly recognizes, the College of Law remains one of the nation’s premier law schools. We are confident that we will justify that assessment with data that are accurate, transparent, and unimpeachable.”

The key recommendations among the eight made in the report are the following:

  • The college’s dean should promptly correct all erroneous data, conduct a comprehensive review of control procedures, and implement “best practices” for staffing and operations of the admissions office.
  • The college should implement “robust” internal monitoring and audit functions “to ensure that internal controls are functioning properly and that all data reported …are accurate and supported,” and should review whether “any other data for which a discernible risk of miscalculation or misreporting exists.”
  • The U of I and the college should embrace the opportunity to champion reforms that would be a model for heightened transparency, avoid placing undue emphasis on any particular data or factor in the admissions process, and continue to reinforce a culture of and commitment to openness and integrity.

Senator Boxer Questions ABA’s Resistance to Basic Change

U.S. Senator Barbara Boxer has once again reached out to the ABA to express concern about the ABA Section of Legal Education’s regulatory failings. This is the third letter from Senator Boxer. The first and second letters, addressed to immediate past ABA President Stephen Zack, both called for the ABA to shore up its oversight responsibilities as it pertains to the provision and verification of consumer information provided by law schools to prospective law students. This letter (full text below), sent to current ABA President William T. (Bill) Robinson III, follows the same themes, though it specifically criticizes the Section’s decision not to require law schools to disclose their legal employment rates for the Class of 2010. It remains clear that the Senator’s interest in law school transparency is not fleeting, but rather the product of genuine concern and disbelief that law schools habitually provide misleading employment information and that the Section of Legal Education is not doing enough to curb institutional misbehavior.

This letter comes in the wake of an editorial we wrote in the National Law Journal. We criticized the Section’s proposed changes to the annual questionnaire because they did not require law schools to disclose their legal employment rates for the Class of 2010.

On Sept. 23, the Section’s Questionnaire Committee will finalize the 2011 questionnaire, which asks about the class of 2010. Additional reforms are slated for 2012. If nothing changes, the section will collect fewer job characteristics data than it has collected in prior years. Apparently, whether a job requires bar passage or only prefers a J.D., or whether a job is full- or part-time, are now too obscure to define without many more meetings.

After the Sept. 23 meeting, nothing changed. In fact, during the meeting certain committee members actually proposed additional ways to count graduate outcomes as desirable, including counting unemployed graduates as employed so long as they had declined a legal offer. While other committee members refuted this attempt to favor law schools over graduates, this sort of protectionism runs counter to basic notions of consumer protection and has no place in the regulation of our country’s law schools.

The 2011 questionnaire, which will no longer ask whether a job is legal in nature, is now active and due at the end of this month. While we believe that Senator Boxer’s letter will eventually force the schools to provide the Class of 2010 legal employment rates at each law school, it should not take congressional hand-holding to get the Section to require such basic consumer information.

As Senator Boxer points out in her letter:

In a year when a number of lawsuits alleging consumer protection law violations have been filed against ABA law schools, when major newspapers have devoted thousands of words to problems with law school reporting practices, and when two United States Senators have encouraged significant changes to your policies, it is surprising that the ABA is resorting to half measures instead of tackling a major problem head on.

The letter also follows an announcement yesterday that two law firms are planning to file class action lawsuits against 15 additional ABA-approved law schools. Taken together, the events of this week may indicate that the Section of Legal Education has less time than it thinks to start turning things around.

Senator Boxer’s Letter

Dear Mr. Robinson:

Following the previous correspondence between your predecessor and me concerning law school reporting practices, I am writing to address some unresolved issues. While I applaud the American Bar Association’s Section of Legal Education for addressing other deficiencies with current post-graduation employment and salary reporting requirements, I was very disappointed to learn that the Section decided not to require that law schools report the percentage of their graduates working in the legal profession or the percentage of graduates working in part-time legal jobs in its upcoming questionnaire.

In my two previous letters to your predecessor, I indicated my strong belief that the ABA should ensure that post-graduation employment data provided to prospective law students is truthful and transparent. His responses appeared to indicate a similar interest, but unfortunately it is difficult to square those previous statements with the Section’s recent decision.

According to The National Law Journal, a Washington University law professor has determined that for the Class of 2009, at least thirty law schools had 50 percent or fewer of their graduates in jobs that required a law degree. Data published by the National Association for Law Placement indicates that since 2001, only two- thirds of graduates from all ABA-approved law schools obtained legal jobs.

However, we know that most law schools report that nearly all of their students have jobs shortly after graduation. The difference between the information reported by schools and the real legal employment rate for recent graduates is very troubling. That is why requiring law schools to accurately report the real legal employment rate of their graduates is so important.

In a year when a number of lawsuits alleging consumer protection law violations have been filed against ABA law schools, when major newspapers have devoted thousands of words to problems with law school reporting practices, and when two United States Senators have encouraged significant changes to your policies, it is surprising that the ABA is resorting to half measures instead of tackling a major problem head on.

I also continue to have concerns about the lack of transparency for prospective law students in other areas:

Independent Oversight

The Section of Legal Education failed to address the overwhelming need for independent oversight and auditing of statistics reported by law schools. In September, the University of Illinois was found to have been inaccurately reporting law school admissions statistics, the second such school to have done so in recent months. In addition, many lawsuits have been filed alleging that law schools are violating various state consumer protection laws and false advertising laws.

These developments are very troubling, and without independent verification of the information reported by law schools, the opportunity to file inaccurate reports will remain.

Merit Scholarships

As I noted in a previous letter, the New York Times has detailed the recent increase in the number of merit scholarships offered by law schools and demonstrated how scholarships are being used to convince students with high LSAT scores to attend lower-ranked law schools.

While the opportunity to earn a very expensive law degree at a fraction of the cost can be an attractive option for many students, the Times exposed a major problem with scholarship transparency. Many law schools fail disclose how the school’s grading curve and scholarship conditions can combine to prevent the student from understanding the scholarship’s real value.

It was reported that at one school, 57 percent of first-year students in one class year received a merit scholarship, but only one-third of the students in that entire class could receive a GPA high enough to maintain their scholarships. Students should have more information about the risks of accepting merit scholarships so that they can make fully-informed decisions about their future.

I appreciate the ABA’s willingness to make some changes to its reporting requirements, but I believe it is in the best interest of law students everywhere for the ABA to address these remaining issues as soon as possible. I look forward to your response.

Sincerely,

Barbara Boxer
United States Senator

The Need for Auditing of Law School Admission Data

We advise all of our readers to take a look at Professor Jerry Organ’s latest piece on the need for auditing law school admission data. His concerns come in the wake of the scandal at the University of Illinois College of Law, where the school has admitted to a pattern of fraud over the last few years. Villanova admitted a similar pattern in January.

As Professor Organ explains:

[T]his behavior is problematic because it not only misleads prospective law students and others regarding the law schools in question, it also erodes the ability of law schools generally to instill in their graduates a professional identity reflecting the highest ethical standards.

Something must be done about this. We have continually reiterated that the Law School Admissions Council would be the cheapest method of ensuring accurate admissions data. All ABA-approved law schools are members. Representatives of LSAC have said that LSAC is not interested in auditing admissions data, despite presently having the capabilities to do so.

A number of pre-law advisors raised this issue with the LSAC at the Pre-Law Advisors National Council Board meeting in March of this year. At that point, however, the LSAC representative expressed no interest in having the LSAC serve as an auditing check on law schools, noting that the LSAC is a membership organization and that any such action would require the consent of the member law schools. Daniel Bernstine, the President of the LSAC, recently was quoted in a National Law Journal article: “That’s just not something we have done historically, and I don’t see why we would. We are not in the reporting business. We don’t distinguish between our [law school] members.”

Despite President Bernstine’s protestations to the contrary, LSAC is in the reporting business. It reports annually the aggregated results of those who take the LSAT and jointly with the ABA publishes the ABA-LSAC Official Guide to law schools, in which the inaccurate data from Villanova and Illinois was reported for the last few years. It also issues a variety of reports to law schools and to pre-law advisors.

Professor Organ has created a survey to gain input on how to best deal with admissions data integrity. You can complete this survey here or by filling it out below.

We will report the results of the survey when Professor Organ makes them available.

Illinois admits admissions data fraud

The National Law Journal reports that University of Illinois College of Law reported inaccurate admissions data to the Section of Legal Education for the past three years. The school did not report inaccurate admissions data to the Section this year, but it is important to note that it did not have the opportunity because the annual questionnaire is not due until October 31st.

The College of Law’s dean had this to say:

Dear College of Law Community:

I write with an update on the ongoing investigation relating to student profile data at the College of Law.

I have previously reported to you that profile data (median LSAT and median GPA) for the class of 2014 disseminated by the College of Law were inaccurate, and that the College has since posted accurate, verified data on its website. Ten years of profiles have been rigorously reviewed, and the inquiry has now determined that student profile data for the classes of 2011, 2012, and 2013 were also inaccurate. The accurate, verified data for these classes (and the previously reported data, indicated in parentheses) are as follows: Class of 2011: LSAT 165 (166) and GPA 3.6 (3.6); Class of 2012: LSAT 165 (166) and GPA 3.7 (3.8); and Class of 2013: LSAT 167 (167) and GPA 3.6 (3.8).

The College is continuing to cooperate fully with the investigation and will report additional findings once they become available.

Sincerely,

Bruce

Bruce P. Smith
Dean and Guy Raymond Jones Faculty Scholar
University of Illinois College of Law

Illinois plans to hire an independent auditor. We would like to reiterate that the Law School Admissions Council would be the cheapest method of ensuring accurate admissions data. All ABA-approved law schools are members. Representatives of LSAC have said that LSAC is not interested in auditing admissions data, despite presently having the capabilities to do so.

Potential admissions data fraud at Illinois


Paul Pless

The Chicago Tribune reported over the weekend that an admissions dean at University of Illinois College of Law has been put on leave pending the outcome of an investigation into the fraudulent reporting of admissions data on the Illinois website. While the data does not appear to have been submitted to the ABA Section of Legal Education, this would still violate Standard 509 because it covers all basic consumer information, not just information submitted to the Section.

Above the Law reports that the investigation will be conducted by Theodore Chung of Jones Day. NonTradLaw reports that the dean is Paul Pless. Confirming this suspicion, Mr. Pless’s profile has disappeared from the Illinois website.

According to Charles Cooper from NonTradLaw:

We need law schools, we need new lawyers, but we don’t need vast numbers of uninformed, indebted, and unhappy law grads. And inflated stats, to some extent, draw in applicants who have no place in law school. This has to stop, at this point, it’s got to stop sooner rather than later.

He is, of course, correct. We expect this to reignite the discussion about auditing all consumer data. While the task will be very difficult and costly for employment data, admissions data would be extremely cheap to audit if the Law School Admissions Council were to cooperate. All ABA-approved law schools are members. Representatives of LSAC have said that LSAC is not interested in auditing admissions data, despite presently having the capabilities to do so.

Breaking: Class action suits filed against Cooley and NYLS

We have just been informed that Kurzon Strauss, the law firm recently sued by Thomas M. Cooley Law School for defamation, will represent plaintiffs in two class action lawsuits against Cooley and New York Law School. The press release, complaints, and summons are attached below.

Both Cooley and NYLS have been in the news lately. Recently, the ABA Section of Legal Education Council acquiesced to Cooley opening a Florida campus. David Segal, writer for the New York Times, targeted NYLS in his latest piece on law schools. (For NYLS’s response, see here.) We also wrote a piece, which is cited in the NYLS complaint, on NYLS’s deceptive practices in April.

We will update this article throughout the day as we learn more.

Updates:

Commentary

Of note, the plaintiffs in the Cooley suit are represented by a 2006 Cooley graduate, Steven Hyder of The Hyder Law Firm, in addition to Kurzon Strauss. This is particularly interesting because Cooley received some pointed criticism for not using its own graduates when filing its defamation suit against Kurzon Strauss.

Readers may also remember that a Cooley graduate, Zenovia Evans, went on a hunger strike for law school transparency.

Both suits are motivated by a goal of transparency:

This action seeks to remedy a systemic, ongoing fraud that is ubiquitous in the legal education industry and threatens to leave a generation of law students in dire financial straits. Essentially, Plaintiffs want to bring an element of “sunlight” or transparency to the way law schools report post-graduate employment data and salary information, by requiring that they make critical, material disclosures that will give both prospective and current students a more accurate picture of their post-graduate financial situation, as opposed to the status quo where law schools are incentivized to engage in all sorts of legerdemain when tabulating employment statistics.

Gomez-Jimenez v. NYLS

  • Points out Dean Matasar’s public recognition that law schools at times exploit students and that law schools and the academy have a “moral responsibilty” to either shut schools down or fix poor outcomes.
  • Alleges two basic, written uniform representations
    • Reporting misleading Nine-month Employment Rates
    • Reporting inflated mean salaries
  • Calls NYLS a “JD-factory”
  • States that there is no place for prospective students to find NYLS’s real employment numbers.
  • “By playing fast and loose with its employment data, NYLS creates an impression of bountiful employment opportunity that in reality does not exist.”
  • “[NYLS] continues to make the fantastical claim that the overwhelming majority of its graduates are gainfully employed.”
  • “NYLS students graduate on average with a whopping $119,437 in loans, placing them in the top 17th percentile of indebtedness among all law school graduates.”
  • “[T]he law school industry today is much like a game of three-card monte, with law schools flipping ace after ace, while a phalanx of non-suspecting players wager mostly borrowed money based on asymmetrical information on a game few of them can win.”
  • Claims: a) New York’s Deceptive Acts and Practices Law, NY General Business Law §349, et seq.; b) Fraud; and c) Negligent Misrepresentation.
  • NYLS increased its first-year class by over 30 percent in 2009, up to 736 students (its largest class ever). This is the second largest incoming class in the country.
  • NYLS Law Professor, Randolph N. Jonakait: “At a school like New York Law, which is toward the bottom of the pecking order, it’s long been difficult for our students to find high-paying jobs…Adding more than 100 students to an incoming class harms their employments prospects. It’s always been tough for our graduates. Now it’s tougher.”
  • “NYLS, by virtue of its participation in NALP’s annual employment survey, clearly has the means to and actually does distinguish between various degrees of employment, and breaks down the exact percentage of its recent graduates who have secured part-time employment.”
  • “NYLS, as with any law school, has every incentive to perpetuate this mass deception, because they are not required by the ABA, Department of Education or any other governing body to independently audit or verify their employment data.”
  • “However, if NYLS was to disclose accurate employment data and the steep odds its graduates face in securing gainful employment, it would become abundantly clear to any rational purchaser how poor of an investment attending NYLS is.”

Plaintiffs

  • Alexandra Gomez-Jimenez: 2007 NYLS graduate; practicing attorney who is a member in good standing of the New York Bar; secured full-time, permanant employment about one year after graduation; she now has her own law firm.
  • Scott Tiedke: 2009 NYLS graduate; practicing attorney who is a member in good standing of the New York Bar; since graduating law school, he has worked as a legal and compliance officer in an investment management firm.
  • Katherine Cooper: 2010 NYLS graduate; unemployed member in good standing of the New York Bar.

Relief Sought

  • Preliminary and injunctive relief enjoining Defendants, their agents, servants, employees and all persons acting in concert with them from continuing to engage in their unlawful recruitment program and manipulation of post-graduate employment data and salary information, and all other unfair, unlawful and/or fraudulent business practices alleged in the complaint and and that may yet be discovered in the prosecution of this action.
  • Injunctive relief ordering that NYLS retains unrelated, independent third-parties to audit and verify post-graduate employment data and salary information
  • Restitution and disgorgement of all tuition monies remitted to NYLS, totaling $200 million.
  • Damages
  • Punitive damages
  • Attorneys’ fees and expenses pursuant to all applicable laws
  • Prejudgment interest

MacDonald v. Cooley

  • Claims: Michigan’s Consumer Protection Act, MCLS §445.901, et seq.; Fraud; Negligent Misrepresentation.
  • Points out how Cooley is the largest law school in the country, “Churning out nearly 1,000 newly-minted JD graduates each year.”
  • Alleges the school has employed “Enron-style” accounting methods, a phrase coined by Professor Bill Henderson in David Segal’s January New York Times article.
  • Claims that despite the school’s advertised employment rate of 80% or higher, if the school were to disclose the percentage of only those “graduates who have secured full-time, permanent positions for which a JD degree is required or preferred,” the percentage could be “30% or lower.”
  • Alleges the school “grossly inflates its graduates’ reported mean salaries” and that the reported medians are not statistically meaningful.
  • Refers to prospective law students as “naïve, relatively unsophiscicated consumers” who are basing their decision to “purchase” a law degree from Cooley “based on asymmetrical information.”
  • “According to US News, Thomas Cooley has the lowest admissions standards of any accredited and provisionally accredited law school in the country. For 2010, it accepted approximately 83 percent of all applicants, an acceptance rate that is nearly 15 percentage points more than the second least selective law school, Phoenix School of Law. The mean LSAT score for incoming students is 146 and the mean undergraduate GPA is 2.99, both lows for all accredited and provisionary accredited law schools.”
  • “In marketing itself to students, Thomas Cooley makes a number of bold, if not incredulous statements that are incommensurate to its low academic and reputational standings in the legal marketplace.”

Plaintiffs

  • John T. MacDonald Jr.: 2010 Cooley graduate; former Naval Officer who served four years and received an honorable discharge prior to attending law school; practicing attorney in good standing with the Michigan Bar; could not find full-time, permanent legal employment and currently operates his own law firm.
  • Chelsea A. Pejic: 2006 Cooley graduate; practicing attorney in good standing with the Illinois Bar; could not obtain gainful legal employment and was unemployed for a long period of time despite circulating hundreds of resumes; has worked as a volunteer staff attorney and temporary contract attorney and has briefly operated her own firm.
  • Shawn Haff: 2010 Cooley graduate; practicing attorney in good standing of the Michigan Bar; could not find full-time, permanent legal employment and was forced to take temporary, contract assignments reviewing documents; currently has his own law firm.
  • Steven Baron: 2008 Cooley graduate; currently unemployed, despite having circulated hundreds of resumes since graduation.

Relief Sought

Seeks refunding or reimbursement to current and former students, an injunction against Cooley’s marketing practices, auditing by an independent third party, and attorneys’ fees.

Press Release

Lawsuits Seek to Reform Reporting of Post-Graduate Employment Data

Two class action lawsuits alleging fraud, negligent misrepresentation and deceptive business practices were filed today against New York Law School (“NYLS”) and Thomas M. Cooley Law School (“Thomas Cooley”). The suits allege that the schools knowingly inflate reported rates of post-graduate employment and salary statistics to recruit and retain students. The putative class actions were filed by three NYLS graduates and four Thomas Cooley graduates, respectively.

“These suits are not just about NYLS and Thomas Cooley – we believe the practice of inflating employment statistics and salary information is endemic among law schools” stated David Anziska an attorney at Kurzon Strauss LLP (“Kurzon Strauss”). “We hope these suits bring systematic change in the way legal education is marketed by making transparency and accuracy the rule, not the exception. Our efforts to bring about that change begin today.”

In addition to seeking monetary relief for current and former students, the suits seek to ensure that law schools report accurate post-graduate employment data that allows prospective students to make an informed decision regarding whether to invest in a law degree. The suits allege that to recruit students for their programs – which cost tens-of-thousands of dollars per-year – law schools, including NYLS and Thomas Cooley, misrepresent their graduates’ employment prospects by misclassifying graduates who have only secured temporary or part-time employment as being “fully” employed, excluding graduates who do not supply information from employment surveys, and creating post-graduate “jobs programs” into which they hire their own graduates.

“We are bringing these suits because thousands of young lawyers, like the plaintiffs, struggle to purchase a home, raise a family and make investments because they leveraged their future to a law school based on inaccurate information,” stated Jesse Strauss, a Kurzon Strauss partner. “It is time for the legal academy to own up to this problem.”

To help prosecute the Thomas Cooley lawsuit, Kurzon Strauss has retained as local counsel Steven Hyder of The Hyder Law Firm, PC, who is a 2006 graduate of Thomas Cooley.

The cases are Gomez-Jimenez et al. v. New York Law School, Index No. Unassigned (electronically filed), (Supreme Court, New York County) and MacDonald et al. v. Thomas M. Cooley Law School, 11-CV-00831 (W.D.MI).

Kurzon Strauss LLP is one of the premier New York based commercial litigation and corporate transactional law firms. For more information, log on to www.KurzonStrauss.com.

ABA Reforms Employment Outcome Disclosure

The ABA Council on Legal Education and Admissions to the Bar completed an enormous step this morning towards helping prospective law students make informed decisions. The Council, which is the sole accrediting body for U.S. law schools, unanimously approved the Questionnaire Committee’s recommended procedures for the improved collection and sharing of employment data. The recommendation is based on last December’s Questionnaire Committee hearing, at which interested parties, including LST’s executive director, presented on the issue of consumer information transparency.

You can review the now-approved recommendation here (pages 22–28), although the vote added two caveats to the recommendation. Under the new policy, for at least one year, the ABA will work with NALP to leverage NALP’s present collection, cleansing, and distribution practices, subject to the ABA and NALP reaching a contractual agreement concerning confidentiality. Working with NALP this year will allow the ABA to avoid unnecessary costs, divergent information, and confusion.

Several Council members were concerned, however, about using a third party—NALP—as part of the Council’s regulatory oversight, thus desire to reach an appropriate contractual arrangement with NALP. Bryan O’Keefe, the Law Student Divison’s student representative to the Council, clarified that these logistical concerns will not hold up publishing the improved data in the upcoming year.

The Council agreed that these issues will not prevent improving data disclosure in the next questionnaire. In the long-term, the Council wishes to exert direct control over the process, either through hiring its own staff or selecting a third-party vendor through a RFP (request for proposal).

The New Disclosure Policy

Caveat One: The Council’s Executive Committee will work with the Questionnaire Committee to reach an appropriate contractual agreement with NALP.
Caveat Two: The Council will begin work as soon as possible to directly collect the relevant data, either through increased staff or an outside vendor.

Job Data

Schools are required to report:

Employment Status (100% of the class will be accounted for with these categories)
Job Credentials: employed in a job requiring bar passage, in a job for which a JD is preferred, in another professional job, in a non-professional job, or in a job of unknown type.
Non-Employed Status: pursuing a graduate degree; unemployed – not seeking or unemployed – seeking; and status unknown.

Employer Type (100% of the class will be accounted for with these categories)
Law Firms: various sizes based on total attorneys at the firm globally (8 total + an unknown category).
Other Employers: business and industry; government; public interest; judicial clerkships; academia; and employer type unknown.

Employment location:
United States: the three states where the most graduates are employed and number employed in each.
International: the number of graduates employed internationally.

Schools will also report data, where applicable, about whether the jobs are full-time/part-time and long-term/short-term, as well as indicate the number of jobs that are funded by the law school or university.

Salary Data

In addition to the placement data, the ABA/LSAC Official Guide will publish state-specific salary information based on graduates reporting from all law schools. According to Questionnaire Committee, only providing school-specific salary data provides “limited and perhaps confusing information” to applicants.

As the Committee also correctly points out, school-specific data is less representative than the state-specific datasets. Moreover, when only ~50% of graduates report a salary, granular categories like “Employed in a Law Firm of 2-10 Attorneys” are unlikely to have sufficient school-specific data to warrant sharing. (This is a flaw we identified with the 509 Subcommittee’s proposal.)

According to Mr. O’Keefe:

By using aggregate data, students will be able to have a more accurate picture of possible salaries.

When you combine the job data and the salary data, applicants will be able to discern the exact job prospects of an individual school, and using the aggregate salary data, develop a solid idea of what that job prospect makes in any given state. The employment location variable will allow students to assess where those graduates end up working— in essence, you will be able to tell where you are most likely geographically to end up getting that job and making that salary.

We agree that this solution will provide prospectives a more thorough and accurate window into the placement opportunities at various law schools. However, we do not think this solution goes far enough with consideration to our goal of helping prospective law students find the schools that best meet their individual career objectives. The adopted solution does not provide enough graduate-level detail for those seeking to make a meaningful connection between the post-graduate outcomes for a given school’s graduates and the job characteristics, including salary, required credentials, and location. It is still too difficult to connect these dots. Nevertheless, it is a monumental improvement that should be celebrated.

Auditing

The Questionnaire Committee also indicates that it will develop ideas for how to improve the accuracy of the data entered by law school graduates and staff.

[A]s an example of a possible response, the ABA might require that annually or at the time of the sabbatical site visit there be random audits of placement data submitted in the annual surveys. If performed at the time of the site visit, these audits might be “informal” and performed by a member of the site team. We have serious concerns, however, with the ability of a site team member to perform this function in the context of a site visit.

We share these concerns. Site team members do not typically have auditing expertise and usually only collect facts from and about the law school. Mechanically, the site team likely would only examine the data collected by the law school to compare to what the school has reported. This creates an echo chamber, duplicates NALP’s data cleansing (which aims to catch mistakes), and would therefore provide only a marginal return on investment. Villanova-style lying would still be too easy to achieve, although even a single set of third-party eyes might deter schools.

An alternative might be to require schools, on a random basis, to provide a more “formal” audit performed by a CPA firm of their placement survey responses. These random audits could be performed annually or at the time of the site visit. Obviously, this would involve greater expense and we would have to look at ways that the expense could be minimized and distributed among law schools, whether they are audited or not. Finally, there may be other methods of performing such an audit, or an alternative to it; we will consider them also.

As is clear from these suggestions, the idea that all law schools should be subject to yearly auditing is not on the table. It seems unnecessary to us because we do not believe the problem lies with falsified data, but misleading information. An effective alternative, which we’ve already shared with the ABA committees, would be to use the LST Proposal. Through sufficient disaggregation, individual graduates could verify how the school reported their outcomes from behind a veil of anonymity provided by the proposal’s structure. This provides a nearly zero-cost alternative that would deter law schools from fabricating outcomes. Upon an accusation of foul play, the school would tender its source (the survey) and the graduate its evidence of misrepresentation.

Going Forward

The Questionnaire Committee operated with a clear mission:

Our objective in selecting, obtaining, and providing [employment] data are several-fold: (1) to provide correct and complete data (a) to law school applicants to assist them in making decisions on whether to go to law school and, if so, which law school to attend, and (b) to current law students and recent graduates to assist them in making job decisions; and (2) to obtain and provide this information in a way that will require the least amount of additional, unnecessary effort by law schools, particularly in their career services offices.

This echoes LST’s mission and objectives. It’s important that the ABA continues to prioritize law school transparency as legal education continues to change over the next decade.

We look forward to the Questionnaire Committee and Council optimizing the annual questionnaire over the next few years with these objectives in mind because there is still a need for more improvement. Elsewhere within the Section of Legal Education, the Standards Review Committee, operating with similar objectives, continues its work on Standard 509. Together, these approved and prospective changes are a great start.

Senator Boxer Calls for Auditing, Better Access to Information

Scrutiny of the ABA continues today as Senator Barbara Boxer increases her pressure on the ABA Section of Legal Education’s regulatory failings. Moments ago, she issued her second letter to the ABA on the need for law school transparency (first letter). This letter to ABA President Stephen Zack addresses why Senator Boxer remains concerned despite the ABA’s current efforts, and asks the ABA to explain their plans regarding a few key concerns (full text below).

Senator Boxer would like to see the ABA address:

  • the auditing of law school data (noting that current proposals continue to allow self-reporting without auditing procedures);
  • better regulation of how prospective students can access information, focusing primarily on how law schools advertise employment outcomes on their websites; and
  • the need for more scholarship transparency.

The letter is in response to Mr. Zack and the Section’s assurances that they are addressing what has become a widely-reported call for law school transparency. Over the past year, the Section has had two committees, the Standards Review Committee and the Questionnaire Committee, both tackling the issue of better informing prospective law students. The Questionnaire Committee will recommend changes to the annual questionnaire to the Section’s Council in June. The Standards Review Committee will recommend its changes to the Section’s Council as early as August.

Senator Boxer and her staff are well-informed on the lack of law school transparency and understand the impact it has on our profession. With this understanding, Senator Boxer is in a position to acknowledge that these committees are off to a good start. Committee members have prioritized these issues and have taken input from all sides in formulating their proposals. However, as Senator Boxer’s letter indicates and as we have outlined before, the proposals currently on the table still need work.

Section Committee members need to continue exploring how best to adequately inform prospective students about the significant investment of earning a law degree. There also needs to be substantial pressure on the Council to approve the committee proposals in June and in August. Finally, Council members will also have to determine whether the proposals go far enough in terms of content, access, and auditing. And as we wrote earlier this week, additional Congressional involvement may be appropriate if the ABA doesn’t do its job.

For these reasons we are renewing our call for the Section of Legal Education to establish a new disclosure standard that meets LST’s criteria, while at the same time improving access to (and understanding of) employment and cost information. Continued congressional scrutiny is making it ever more obvious that the public is demanding accountability. We look forward to hearing the ABA’s response.

Senator Boxer’s Letter

May 20, 2011

Dear Mr. Zack:

Thank you for your response to my letter regarding the transparency and accuracy of post-graduation employment and salary information reported by law schools.

I was encouraged to learn that in June the Section on Legal Education and Admission to the Bar will be considering recommendations on how the ABA can improve access to accurate and transparent information for prospective law school students. I view this as a positive step toward improved standards, but before completing its work on these important recommendations, I urge the Section to address some other important issues.

1. Independent Oversight

It is troubling that the recommendations do not address the need for independent oversight of the data law school deans submit to the ABA and publications like U.S. News and World Report. The Section’s recommendations would allow law schools to continue to submit unaudited data, despite the fact that a lack of oversight has been identified by many observers as a major problem.

The editor of U.S. News and World Report wrote a letter to all law school deans, noting a “crisis of confidence in the law school sector” and asked deans to be more vigilant in their data reporting. This letter and the recent news that a well-known law school admitted to knowingly reporting inaccurate data to the ABA for years indicates that independent oversight must surely be a part of any reform proposal.

2. Easy Access for Students to Information

The ABA should undertake efforts to ensure that students have easy access to post-graduation employment and salary information. Prospective students should not have to search far and wide for information so critical to determining their futures. To achieve this goal the ABA should make it standard practice for law schools to post links to this information on website homepages, and to include these documents in acceptance notices.

I would be remiss not to mention a very troubling New York Times article on law school merit scholarships. The article detailed the recent increase in the number of merit scholarships offered by law schools and demonstrated how scholarships are being used to convince students with high LSAT scores to attend lower-ranked law schools.

While the opportunity to earn a very expensive law degree at a fraction of the cost can be an attractive option for many students, the Times exposed a major problem with scholarship transparency. Many law schools not only fail to make it clear that prospective students must meet minimum GPA requirements, they also do not disclose how the law school’s grading curve can prohibit all students offered scholarships from maintaining the benefit every year.

It was reported that at one school, 57 percent of first-year students in one class year received a merit scholarship, but only one-third of the students in that entire class received a GPA high enough to maintain a scholarship. In the Times article, an ABA official admitted he was unaware of any problems with merit scholarships, and noted that the ABA does not ask schools to report how many students lose their scholarships each year and does not publish any information for prospective students on this subject.

I look forward to reviewing the results of the Section’s June meeting, as well as your response to the merit scholarship issue.

Sincerely,

Barbara Boxer
United States Senator