IN THE CIRCUIT COURT OF COOK COUNTY, ILLINOIS COUNTY DEPARTMENT, CHANCERY DIVISION JONATHAN PHILLIPS, BRIAN LOKER, ADAM SMESTAD, XAVIER HAILEY, BRENT DAVIDSON, SHELLYE, TAYLOR, ALLISON LEARY, and AMMANUAL LUBA, on behalf of themselyes apd all others similarly situated Case No. y2cnos 523 CLASS ACTION COMPLAINT Plaintiffs, v. JURY TRIAL DEMANDED De PAUL UNIVERSITY, a/k/a as De PAUL UNIVERSITY COLLEGE OF LAW, and DOES 1-20 Defendants CLASS ACTION COMPLAINT Plaintiffs, Jonathan Phillips, Brian Loker, Adam Smestad, Xavier Hailey, Brent Davidson, Shellye Taylor, Allison Leary and Ammanual Luba, on behalf of themselves and all others similarly situated (collectively “Plaintifis"), by and through their altomeys allege and complain against Defendant De Paul University College Of Law (“De Paul” or “Defendants”) and individual DOF Defendants as follows: INTRODUCTION “Sunlight is the Best Disinfectant” — Justice Louis Brandeis 1. 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, PlaintifTs 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 material disclosures that will give both prospective and current students an accurate picture of their post-graduate financial situation, as opposed to the status quo where law schools ate incentivized to engage in all soris of deception when tabulating employment statistics, 2, De Paul is a private institution located in Chicago and part of De Paul University which first opened its doors in 1897 and boasts of an alumni base which includes three mayors of Chicago and more than 350 state and federal judges. In its online Viewbook for prospective students, the schoo! claims: “When you graduate from De Paul, you'll have more than a superior education, You'll be connected -- a member of a worldwide network of De Paul alumni that includes outstanding leaders and experts in all areas of the legal profession. The connection between De Paul and Chicago is legendary. Our reputation in Chicago gives you a built-in edge, but it never limits the scope of your career.” 3. All of these myriad opportunities, the school insists, result in a placement rate of well over 90 percent, a number which puts it on par with higher ranked llinois-based law schools, such as the University of Ilinois College of Law and Northwestern University College of Law. 4, In-seality, far from giving that their graduates “a cornpetitive edge,” and placing them in good, secure, well-paying jobs, De Paul consigns the majority of them to years of indentured servitude, saddling them with tens of thousands of dollars in crushing, non- dischargeable debt that will take literally decades to pay off. The school has done this while Dlatantly misrepresenting and manipulating its employment statisties to prospective students, by employing “Enron-style” accounting techniques, ‘These deceptions are perpetuated so as to prevent prospective students from realizing the obvious ~ that attending De Paul and spending vwell over $120,000 in tuition payments is a terrible investment which makes little economic sense and, most likely, will never pay off5. De Paul, through both print and internet marketing materials it produced and disseminated, makes twe uniform, written misrepresentations: i a, First, De Paul reported with “Madofi-like consistency that, depending on the year, roughly between 88 and 98 percent of its graduates secured employment within nine months of graduation, The context of these representations make it appear to the reasonable consumer, such as Plaintiffs, that the jobs reported are full-time, permanent positions for which a law degree is required or preferred. These numbers ate false and materially misleading because De Paul’s reported employment numbers include any type of employment, including jobs that have absolutely nothing to do with the legal profession, do not require a JD degree or are temporary or part-time in nature. If De Paul were to disclose the number of graduates who have secured full-time, permanent positions for which a JD degree is required or preferred, the numbers would drop dramatically, and could be well below 50 percent, if not even lower. b, Second, De Paul grossly inflates its graduates’ reported mean salaries, by calculating them based on a small, deliberately selected subset of graduates who actually submit their salary information, Ifthe Defendants were to disclose salary data based on a | broad, statistically meaningful représentation of its graduates, including those graduates who have failed to secure full-time, permanent employment, the reported mean salaries would decline precipitously. 6. There is no place where prospective students can find De Paul's “real” . employment numbers. The school supplies the same dubious statistics to the U.S. News & World Report (“US News”) and the American Bar Association (“ABA”), the two primary sources of information for law school employment data. These sources also count as “employed” those‘who have secured employment in any capacity in any kind of job, no matter how unrelated to the legal profession. 7. De Paul’s representations are demonstrably false for the following reasons: a) De Paul’s reported placement rates and salary information remained eerily steady following the aftermath of the “Great Recession,” as the placement rate for the class of 2009 was a robust 93 percent and 88 percent for 2010. Currently, the legal employment market is highly oversaturated, with law schools churning out 43,000 ID degrees each year, even though roughly half as many legal positions are available (26,000). Yet, with legal positions becoming increasingly scarce, De Paul, instead of telling the sobering truth to prospective and current students, continues to make the false claim that the overwhelming majority of its graduates are gainfully employed. The false data was material to Plaintiffs and as members of the class. b) As set forth in detail below, the employment and salary data reported by De Paul are at odds with employment statistics reported by NALP, meaning that for De Paul’s statistics to be accurate it would likely need to be placing students well above the approximately 40 percent of law school graduatés nationally who secure full-time, permanent legal employment, despite its relatively lenient admission standards and modest ranking by US News. Unfortunately, De Paul’s false and fraudulent representations and omissions are endemic in the law school industry, as nearly every school to a certain degree blatantly manipulates its employment data to make De Paul more attractive to prospective students. Plaintiffs relied on such data and were damaged thereby. It is a dirty industry secret that law schools employ a variety of deceptive practices and accounting tricks to “pretty up” or “cook”the job numbers, including, among other things, hiring recent unemployed graduates as “research assistants” or providing them with “public interest” stipends so as to classify them as employed, exeluding graduates who do not supply employment information from employment surveys, refusing to categorize unemployed graduates who are not “actively” seeking employment as unemployed, and classifying graduates who have only secured temporary, part-time employment as being “fully” employed. 9, By playing fast and loose with its employment data, De Paul creates an impression of bountiful employment opportunity that in reality does not exist, and convinces Plaintiffs and members of the putative class to take on substantial debt to finance their De Paul education, According to US News, De Paul students graduate on average with a whopping $121,324 in loans, placing them in the top 15 percentile of indebtedness among all law school graduates, The current tuition for De Paul is $47,240, excluding living expenses, making it one of the more expensive law schools in the country, despite the fact that it is ranked by US News 84" of all accredited law schools, The named Plaintidfs and all members of the class review such data to their detriment and damage. Damages consisted of wasted time, tuition paid and debt incurred, 10, De Paul and the Jaw school iadustry in general have been astonishingly successful in deceiving prospective students about the value of a law degree in an effort to maintain and increase both enrollment and tuition, Last year, a record 51,426 first-year students enrolled in law schools, up by over 60 percent from 1971, while De Paul currently enrolls about 1,000 students, Additionally, tuition at De Paul -- much like the rest of the law school profession -- has risen exponentially over the past two decades, far exceeding both inflation and any increase in