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SMESTAD, XAVIER HAILEY, BRENT DAVIDSON, SHELL YE TAYLOR, ALISON LEARY, JAIME WALSH and MADISON MULLADY, on behalf of themselves and all others similarly situated, Plaintiffs, Case No. 12-CH-03523 Judge Neil Cohen
DEPAUL UNIVERSITY, a/k/a as DEPAUL UNIVERSITY COLLEGE LAW, and DOES 1-20, Defendants. OF
MEMORANDUM OF LAW IN SUPPORT OF DEFENDANT'S COMBINED MOTION TO DISMISS PLAINTIFFS' FIRST AMENDED CLASS ACTION COMPLAINT PURSUANT TO 7351LCS 5/2-615 AND 5/2-619 This case is one of over a dozen virtually identical purported class action lawsuits filed by disappointed law school graduates against their law schools complaining about their job prospects at the infancy of their careers.
As recognized by Judge Schweitzer, in dismissing a
virtually identical case filed by Plaintiffs' counsel for failure to state a cognizable legal claim, the issues posed by these cases "exemplify the adage that not every ailment afflicting society may be redressed in a lawsuit." Gomez-Jimenez et al. v. New York Law Sch. et al., No. 652226/2011 at 30 (N.Y. Sup. Ct. Mar. 21, 2012) ("Gomez") (attached as Ex. A). Plaintiffs here, nine recent DePaul University College of Law ("DePaul") graduates alleged to be bar members in good standing, assert essentially the same causes of actions rejected by the Court in Gomez: (1)
I In addition to the suit against DePaul, graduates have filed suit in this Court against John Marshall Law School and Chicago Kent College of Law. See Johnson et al. v. John Marshall Law School et al., No. 12-CH-03494 (III. Cir. Ct. Cook Co. 2012) (filed Feb. 1,2012); Evans et al. v. Chicago Kent College of Law et al., No. 12-CH-03522 (III. Cir. Ct. Cook Co. 2012) (filed Feb. 1,2012).
violation of the state's consumer fraud act (here, the Illinois Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 50511 et seq. ("ICF A")); (2) common law fraud; and (3) negligent misrepresentation. As in Gomez, Plaintiffs claim that DePaul misled them by
disseminating certain historical nine month post-graduate employment statistics and that their reliance on those statistics caused damages in the form of disappointed starts to their legal careers. (Compl. ~~ 10-18, 86-100.) The failure of Plaintiffs to immediately realize their career goals, however, is not actionable under the law. Plaintiffs cannot plead either causation or damages, both required elements of their legal theories. Nor can they articulate a misrepresentation, demonstrate reasonable reliance, or establish any legal duty. Additionally, the ICFA's safe harbor provision for conduct authorized by law shields DePaul's reporting of historical post-graduate employment data pursuant to the Higher Education Act ("HEA"), 20 U.S.C. § 1001 et seq., and ABA standards. For these reasons, Plaintiffs' Complaint should be dismissed.
Plaintiffs, who seek to represent a class of "[a]ll persons who are either presently enrolled in DePaul University College of Law to obtain a JD degree, or obtained such a degree, during the period from 2006 to the present," claim to have relied on alleged misstatements in DePaul's marketing materials in deciding to enroll in law school. (Compl. ~~ 77, 10-18, 35-40l Specifically, Plaintiffs complain that DePaul represented that, depending on the year, "between 88 and 98 percent of its graduates secured employment within nine months of graduation," without specifically identifying the number of graduates reporting employment in full-time
2 In addition to DePaul, Plaintiffs charge that certain unidentified Doe Defendants "either personally made or disseminated the false and misleading representations contained herein or contributed to the acts and practices alleged herein." (Compl. ~~ 21,23.) These claims are void as a matter of law. See Section III, infra.
permanent positions for which a JD degree is required or preferred. (Compl. ~~ 35-40.)3 Plaintiffs further complain they were misled by DePaul's reporting of salary information provided by graduating law students. (Compl. ~~ 35, 39.) ARGUMENT I. PLAINTIFFS' COMPLAINT SHOULD BE DISMISSED UNDER 735 ILCS 5/2615 FOR FAILURE TO STATE A CAUSE OF ACTION. Under Illinois fact-pleading rules, a complaint must set forth well-pleaded facts that, if true, establish each of the essential elements of the cause of action asserted. See Anderson v. Vanden Dorpel, 172 Ill. 2d 399, 408-09 (1996). While a Section 2-615 motion admits "wellpleaded facts" as true, it does not admit "conclusions of law or factual conclusions that are unsupported by allegations of specific facts." Barille v. Sears Roebuck & Co., 289 Ill. App. 3d 171, 174 (1st Dist 1997). A motion to dismiss should be granted "[i]f after disregarding any legal and factual conclusions the complaint does not allege sufficient facts to state a cause of action." Id. 4
Plaintiffs Fail to State a Cause of Action Under the Illinois Consumer Fraud and Deceptive Business Practices Act.
To state a cause of action under the ICF A, Plaintiffs must show: (1) a deceptive act or practice by the defendant; (2) defendant's intent that the plaintiff rely on the deception; (3) that the deception occurred in the course of conduct involving trade or commerce; and (4) actual
salary and employment
data based on information
that is voluntarily
alumni. (See Compl. ~ 35 (employment and salary statistics are "based upon surveys sent to then recent DePaul graduates"); Compl. ~ 39(c)(ii) (vthe data were obtained only through surveys voluntarily returned).)
4 Plaintiffs' fraud and ICF A claims must satisfy heightened pleading standards. See Weidner v, Karlin, 402 III. App, 3d 1084, 1087 (3d Dist. 2010) (fraud must be pleaded with specificity and particularity); see also Sklodowski v, Countrywide Home Loans, Inc., 358 III. App. 3d 696, 703 (1st Dist. 2005) ("An action under the Consumer Fraud Act must be pleaded with the same specificity that has always been a prerequisite to an action for common law fraud ... the complaint must state with particularity and specificity the deceptive manner of defendant's acts or practices, and the failure to make such allegations requires the dismissal of the complaint.") (internal citations and quotations omitted).
damage to the plaintiff as a result of the defendant's violation of the Act. Sklodowski, 358 Ill. App. 3d at 703. Because Plaintiffs have failed to plead facts to show that DePaul's statements were deceptive or caused Plaintiffs' injuries or facts to establish they have suffered a measurable loss, their ICF A claim should be dismissed. 1. Plaintiffs Have Not Alleged a Deceptive Act or Practice.
Plaintiffs' ICFA claim fails because Plaintiffs have not adequately alleged a deceptive act or practice. See Bober v. Glaxo Wellcome PLC, 246 F.3d 934, 938 (7th Cir. 2001) (affirming dismissal of ICF A claim and holding that "a statement is deceptive if it creates a likelihood of deception or has the capacity to deceive"); see also LeDonne v. AXA Equitable Life Ins. Co., No. 05 C 1151,2009 WL 3721038, (a)
* 9 (N.D.
Ill. Nov. 2,2009) (same).
DePaul's Marketing Materials Do Not State That All Reported Employment Is Full-Time or In Positions Requiring or Preferring a Law Degree.
Plaintiffs allege that DePaul's statements are deceptive in essentially three ways.i' First, Plaintiffs allege that DePaul's marketing materials "made it reasonably appear" "that the jobs reported represented full-time permanent employment in positions for which a J.D. degree was required or preferred." (Compl.,-r 37l In support of this allegation, Plaintiffs refer to employment information reported by students graduating in 2009,2007 and 2005 and published in DePaul's marketing materials. (Compl. ,-r36.) These marketing materials, however, identify not only the percentage of graduates reporting employment within nine months of graduation,
5 Notably Plaintiffs have not alleged that they did not receive a legal education from DePaul or that DePaul failed to prepare them to practice law. (Compl." 26, 28). Indeed, Plaintiffs allege that they are all practicing attorneys who are members in good standing of their respective bars. (Cornpf. f 10-18).
The Gomez court rejected plaintiffs' similar allegation. Ex. A at 12 ("Plaintiffs allege that these statistics somehow deceptively make it appear that the jobs reported are all full-time permanent positions for which a law degree is required or preferred ... No such statement is made by NYLS in its marketing materials, however.").
but also clearly disclose the percentage of graduates reporting employment in private practice (law firms), business, government, public interest, and judicial clerkships. (Compi. ~~ 35-36.) For example, in 2009, 26% of graduates reported employment in "business." (Compi. ~ 36.)
While certain businesses employ in-house counsel, many do not. With a quarter of graduates reporting employment in business, a reasonable consumer would conclude that the statistics included both legal and non-legal jobs. The Gomez court concluded that New York Law School's employment data is not deceptive to a reasonable law school consumer because (1) prospective law students, all college graduates, are a particularly sophisticated group of consumers; (2) prospective students have available other public information regarding law schools, including National Association for Law Placement ("NALP") publications and U.S. News and World Reports that include general rankings as well as specific breakdowns of law schools according to the success of graduates in obtaining jobs, salary earned, rates of tuition, and student loan debt incurred; (3) the reasonable law school consumer would understand the relationship between law school rankings and future employment and salary prospects; (4) the reasonable law school consumer would understand that many law school graduates "toil (perhaps part-time) in drudgery or have less than hugely successful careers"; and (5) the reasonable law school consumer would have taken into account the impact of the 2008 recession on the legal job market. Gomez, Ex. A at 10-18. This reasoning applies equally here to the representations alleged to be deceptive in this case. (b) DePaul's Reporting of Historical Employment Information Provided by Past Graduates Cannot Be Considered A Promise to Graduates of the Future.
Second, Plaintiffs allege that DePaul's employment statistics "purport to be a reasonable projection by De Paul of Plaintiffs' post-graduate employment prospects if he or she
enrolled in De Paul rather than elsewhere." (CompI. ~ 67.) None of DePaul's marketing materials, however, make any promises about future employment, let alone employment in highpaying jobs. See Blane v. Ala. Commercial Coll., Inc., 585 So. 2d 866, 868 (Ala. 1991) (fraud claim alleging that student was unable to find employment upon graduation failed because the college did not guarantee the student a job, but merely promised to provide her with minimum clerical skills necessary to compete for jobs in clerical field). DePaul's statistics merely consist of historical data about the employment and salary outcomes of students who graduated before Plaintiffs entered the job market. These statistics cannot reasonably be understood to promise any particular employment or salary to future graduates. (c) DePaul's Materials Clearly Disclosed a Range of Salaries Reported.
Third, Plaintiffs allege that DePaul's marketing materials were deceptive because they reported salary information only for graduates in full-time employment who generally had higher salaries than graduates in part-time employment. (CompI. ~ 39(b).) In each year, however, DePaul's marketing materials clearly disclosed what the reported average starting salary was for a particular business segment (e.g., private practice or business). (Compi. ~ 36) Additionally, in each year, DePaul's marketing materials clearly disclosed a range of salaries reported, with graduates at the low end of the range reporting an annual starting salary between $20,000 and $30,000 in each of2007 and 2009. (See Affidavit of Michael Bums ("Burns Aff."), attached as Ex. B, and Exs. 1-2 to Burns Aff. ("Burns Aff. Exs. 1-2,,).)7 Given the inherent nature ofa range, with a high end and a low end, the only reasonable conclusion that could be drawn from the reported salary data is that some graduates earned a relatively high salary, while others
7 To the extent DePaul has introduced matters outside the Complaint with respect to that part of its motion seeking dismissal of Plaintiffs' ICFA claims related to alleged salary misrepresentations, DePaul is properly proceeding under 735 ILCS 5/2-6 I9(a)(9). See Bryson v. News Am. Publ 'ns, Inc., 174111.2d 77, 92 (1996).
earned more modest salaries similar to those earned by workers without a JD degree. See Bober, 246 F.3d at 939-40 (statements did not falsely claim or imply that Zantac 75 could not be substituted for Zantac 150 where "examining the statements at issue, together and in the context of the other information available to Zantac users, eliminate[ d] any possibility of deception with regard to substitutability"). In sum, Plaintiffs must plead a deceptive act or practice, and having failed to do so, their ICF A claims should be dismissed. 2. Plaintiffs Cannot Establish Causation: There Is No Connection Between Statistics Reported by DePaul for Past Graduates and Whether and Under What Circumstances Plaintiffs Will be Employed Nine Months After Graduation.
Causation is a required element of Plaintiffs' ICFA claim. See Adler v. William Blair & Co., 271 Ill. App. 3d 117, 128 (lst Dist. 1995) (citing Huddleston v. Herman & MacLean, 640 F.2d 534, 549 (5th Cir. 1981) ("The plaintiff must prove not only that, had he known the truth, he would not have acted, but in addition that the untruth was in some reasonably direct, or proximate, way responsible for his loss.") (internal quotations omitted)); Mulligan v. QVC, Inc., 382 Ill. App. 3d 620, 630 (l st Dist. 2008) (in ICF A claim, "the relevant inquiry is whether the harm would have occurred absent the defendant's conduct. "). Plaintiffs allege that they graduated "with near-term and lifetime job prospects that are, statistically, less than they would have been" had the "employment numbers [been as] DePaul claimed." (Compl. ~ 65.) They fail, however, to allege any facts demonstrating that "but for" DePaul's alleged misrepresentations, Plaintiffs would have secured the employment and compensation they desired. Quite simply, there is no connection between representations DePaul made in its reporting of employment statistics by past graduates and whether and under what circumstances Plaintiffs will be employed after graduation. Instead, numerous factors determine a graduate's employment prospects and earning potential. These include factors specific to the
individual, such as previous work experience; degrees and credentials; law school and undergraduate performance; participation in law review, moot court, legal internships, clerkships and other extracurricular activities; efforts to search for and secure employment, including the geographic scope of the job search; and the individual's effectiveness in employment interviews, among others. Additionally, labor market conditions impact employment prospects and compensation. Indeed, the current economic recession has greatly diminished employment
prospects for all law school graduates, presumably including the Plaintiffs. See Gomez, Ex. A at 34 ("there has been a supervening event, the 2008 Great Recession and its aftermath, which has wreaked havoc throughout the legal job market and upset the plans of the most recent law graduates wherever they have attended law school"). Absent any allegations linking Plaintiffs' alleged failure to secure a particular type of employment or level of compensation to DePaul's alleged deceptive acts, Plaintiffs' claims should be dismissed. See Mulligan, 382 Ill. App. 3d at 630 ("deception must have been the cause-in-fact or the 'but for' cause of the injury"); Adler, 271 Ill. App. 3d at 128. 3. Plaintiffs Fail to Allege Determinable Damages.
As in Gomez, Plaintiffs' theory of damages "is entirely too speculative and remote to be quantified as a remedy under the law." See Gomez, Ex. A at 34. Plaintiffs seek to recover (1) the portion of their tuition payments attributable to DePaul's allegedly "inflated" employment statistics, and (2) additional lifetime income Plaintiffs claim they would have been expected to earn if DePaul's allegedly "inflated" employment statistics had been true. (Compl.,r 69} can of course be no portion of tuition payments attributable to the reported employment There
8 Some of Plaintiffs' claims of injury are inconsistent with their own allegations. While claiming they suffered poorer employment prospects than the reported historical numbers, Plaintiff Brian Loker, for example, alleges that "[ajfter graduation [he] obtained employment as an associate at the law firm of Patterson & Sheridan, LLP." (Cornpl. ~ 18(b).)
statistics. The tuition payments made equaled the amount charged students by DePaul to matriculate in its law school. The amount is not related to any representations regarding the employment experiences of past graduates. Similarly, there is no margin of "additional lifetime income" that is a variable depending on representations relating to former graduates. Moreover, additional lifetime income cannot be calculated for the Plaintiffs. Plaintiffs' damages are wholly speculative and their ICF A claims must be dismissed for this reason. For any measure of damages to be proper, Plaintiffs' degrees must be valued at less than as represented. See Buller v. Owner Operator Indep. Driver Risk Retention Group, Inc., 461 F. Supp. 2d 757, 762 (S.D. Ill. 2006) (the "measure of damages in consumer fraud cases, as in cases alleging common-law fraud, is the benefit of the bargain, that is, the difference between the value of the item as represented and what the item purchased was actually worth") (internal quotations omitted). But DePaul never made any representations about the value of Plaintiffs' degrees. Instead, DePaul made certain statements about the income and employment outcomes of its past graduates. Plaintiffs' theory of damages assumes that the value of Plaintiffs' degrees is related to the job and salary outcomes experienced by these other graduates. (Compl. ~ 68 ("To the extent [DePaul's] statistics were inflated by X percent, the advantage to Plaintiffs and the value of the tuition and fees they paid to De Paul was reduced by X percent").) But the job and salary
outcomes of former graduates only tell something about the value of their law degrees to them, and only as of nine months after law school. The value each Plaintiff is able to make of his or her degree depends on numerous variables, some of which can be impacted by the conduct of Plaintiffs and others of which are determined by labor market forces. The Plaintiff-driven variables include the law school grades that inform the degree, law school internship experiences, various skills developed after graduation, and the career path-from lobbying to
law practice to government service-pursued
by each Plaintiff. The labor market forces include
the overall health of the legal job market and the strength or weakness of the general job market. Moreover, the value of each Plaintiff's law degree cannot be determined in the months or even years immediately following graduation from law school, but can be assessed, if at all, only over time. A legal career is idiosyncratic and spans a lifetime. Its value can only be determined over a lifetime of practice. Plaintiffs refer in their Complaint to "near term and lifetime job prospects that are, statistically, less than they would have been" (Compl. ,-r 65 (emphasis addedj), but Plaintiffs cannot plead what those prospects are and that is a fatal defect in the case. Any attempt by this Court to assign a value to Plaintiffs' law degrees would require the Court to engage in rank speculation. See Gomez, Ex. A at 19 n.9 (theory of damages based on "the difference between what [law school graduates] paid for their [law school] degrees in reliance on representations contained in the marketing materials and what the degrees were intrinsically worth" is "far too speculative to formulate a valid claim for damages"); see also Mihalakis v. Cabrini Med. Ctr., 151 A.D.2d 345, 346 (N.Y. App. Div. 1989) (plaintiffs' alleged loss, "measured by the difference between the value of the internship program provided by defendants and the value of an internship program having the characteristics that defendants represented," must be rejected as speculative). Because Plaintiffs' theory of damages is wholly speculative, their ICFA claims should be dismissed. See Petty v. Chrysler Corp., 343 Ill. App. 3d 815, 823 (l st Dist. 2003) ("[Dlamages may not be predicated on mere speculation, hypothesis, conjecture or whim") (internal quotations omitted); see also Yu v. Int'l Bus. Mach. Corp., 314 Ill. App. 3d 892, 897 (1st Dist. 2000) ("Failure to state sufficient facts to constitute a legally cognizable present injury or damage mandates dismissal of the action.").
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Plaintiffs Fail to State a Cause of Action for Fraud.
To state a cause of action for fraud, Plaintiffs must allege each of the following: (1) a false statement ofa material fact; (2) defendant's knowledge that the statement was false; (3) defendant's intent that the statement induce plaintiff to act; (4) plaintiff's reliance upon the truth of the statement; and (5) plaintiffs damages resulting from reliance on the statement. Prime Leasing, Inc. v. Kendig, 332 Ill. App. 3d 300, 308-09 (1st Dist. 2002). Plaintiffs have not alleged facts sufficient to establish a material misrepresentation or causation. Further, as set forth in Section LC.2, infra, Plaintiffs cannot establish reasonable reliance.9 Additionally, as with Plaintiffs' other claims, in an action for fraud, speculative damages cannot be recovered. See Cangemi v. Advocate S. Suburban Hosp., 364 Ill. App. 3d 446, 470 (1st Dist. 2006). Accordingly, Plaintiffs' fraud claims should be dismissed.10
Plaintiffs Have Not Sufficiently Alleged Fraud by Omission.
To the extent Plaintiffs allege DePaul committed fraud by omission (see Compl. ~~ 39, 40, 105), they fail to state a cause of action because they cannot establish that DePaul owed a duty of disclosure. See Lidecker v. Kendall Coll., 194 Ill. App. 3d 309,314 (1st Dist. 1990) (in cause of action for common law fraud, plaintiff must establish that "defendant has a duty to inform plaintiff of any allegedly omitted material fact"). A duty of disclosure arises if plaintiff and defendant "are in a fiduciary or confidential relationship" or if "plaintiff places trust and confidence in defendant, thereby placing defendant in a position of influence and superiority
9 Causation and reasonable reliance are required elements of Plaintiffs' fraud claim. See Lewis v. Lead Inds. Assoc.,
243 Ill. App. 3d 95, 104-05 (1st Dist. 2003) (causation); Benson, 407 Ill. App. 3d at 921 (reasonable reliance).
10 Nor have Plaintiffs sufficiently alleged intent to deceive. Compare Bank v. Brooklyn Law Sch., No. 97-CY7470(JG), 2000 WL 1692844, at * 7 (E.D.N.Y. Oct. 6, 2000) ("if the desire to attract first-rate students and enhance an institution's reputation were sufficient to give rise to a strong inference of an intent to deceive, colleges and professional schools could face countless meritless suits based on statements made in the information they disseminate") with Compl. ~ 34 (DePaul "affirmatively and actively sought to market itself to prospective and current students by emphasizing the success its graduates had found in obtaining desirable jobs after graduation").
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over plaintiff," which may arise "by reason of friendship, agency, or experience."
Stafford, 407 Ill. App. 3d 902,918 (Ist Dist. 2010) (internal quotations omitted). The standard for identifying a special trust relationship is "extremely similar to that of a fiduciary relationship." Id. at 919.
Plaintiffs allege that "Defendants occupy a fiduciary position as educators, and owe a heightened duty of care to Plaintiffs and members of the class to act in good faith and engage in fair dealings." (Compl. ~ 118.) DePaul does strive to act in good faith and engage in fair dealings with its students; however, the law is clear that schools and students are not in a legal fiduciary relationship. See May v. Adelphi Inst., Inc., 866 F. Supp. 696, 708 (E.D.N.Y. 1994) (fiduciary relationship does not arise simply because a school "enroll [s] [plaintiffs] and accept[ s] government funds on their behalf'; "without more, a conventional business relationship, does not become a fiduciary relationship by the mere allegation") (internal quotations omitted); Ohio Univ. Bd. a/Trustees v. Smith, 132 Ohio App. 3d 211, 220 (Ohio Ct. App. 1999) (finding that there was no support for the existence of a "fiduciary relationship between an educational institution and a prospective student"); Maas v. Corp. of Gonzaga Univ., 27 Wash. App. 397, 400 (Wash. Ct. App. 1980) (rejecting a student's claim that confidential or fiduciary relationship arose; "[tjhe relationship between students and universities is generally contractual rather than fiduciary. ").
Plaintiffs also allege that DePaul owed Plaintiffs a duty arising out of the ABA Rules; DePaul's position of superior knowledge and access to information; and DePaul's special nature as a highly respected law school. (See Compl. ~~ 47-50,53,104,117.) These allegations fail
sufficiently to allege a fiduciary or special trust relationship. To establish a special trust relationship, the defendant must exercise overwhelming influence over the plaintiff. See Benson,
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407 Ill. App. 3d at 913; see also Carey Elec. Contracting, Inc. v. First Nat 'I Bank of Elgin, 74
Ill. App. 3d 233,238 (2d Dist. 1979) ("Normal trust between friends or businesses, plus a
slightly dominant business position do not operate to turn a formal, contractual relationship into a confidential or fiduciary relationship."). fraudulent omission must fail. II C. Plaintiffs Fail to State a Cause of Action for Negligent Misrepresentation. Absent any such allegations, Plaintiffs' claim for
To state a claim for negligent misrepresentation, Plaintiffs must allege each of the following: (1) a false statement of material fact; (2) carelessness or negligence in ascertaining the truth of the statement by the party making it; (3) an intention to induce the other party to act; (4) action by the other party in reliance on the truth of the statement; (5) damage to the other party resulting from such reliance; and (6) a duty on the party making the statement to communicate accurate information. Rojas Concrete, Inc. v. Flood Testing Labs., lnc., 406 Ill. App. 3d 477, 479-80 (I st Dist. 2010); Midfirst Bank v. Abney, 365 Ill. App. 3d 636, 651 (2d Dist. 2006). For the same reasons discussed above, Plaintiffs cannot allege facts sufficient to establish a material misrepresentation or causation.
And, as with Plaintiffs' IeF A and fraud claims,
Plaintiffs cannot recover speculative damages under a negligent representation theory. See Dloogatch v. Brincat, 396 Ill. App. 3d 842,851-52 (Ist Dist. 2009) (in negligent
misrepresentation case, holding "[tjhe evidence must show a basis for computing damages with a
II With respect to the Lawyer (Doe) Defendants, Plaintiffs allege that "by virtue of the fact that many of De Paul's staff and faculty are attorneys and members of the Illinois Bar, they have certain ethical obligations and responsibilities to Plaintiffs and members of the Class," and that they violated these obligations by publishing the allegedly fraudulent employment and salary data. (Compl. ~ 119; see also Compl. ~~ 54-57, 118, 125-26, 132-33). Even assuming that the rules of professional conduct have been violated-which they have not-the mere fact that an attorney may have violated professional ethics does not, in and of itself, give rise to a cause of action for damages. See Nagy v. Beckley, 218 Ill. App. 3d 875, 879 (I st Dist. 1991) ("The rules of legal ethics do not establish a separate duty or cause of action. "). Regardless, claims against fictional defendants are void as a matter of Illinois law. See Section Ill, infra. 12 Causation is a required element of Plaintiffs' negligent misrepresentation claim. Zahorik v. Smith Barney, Harris Upham & Co, 664 F. Supp. 309, 313 (N.D. Ill. 1987).
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'fair degree of probability"'); Johnson Bank v. George Korbakes & Co. LLP, 472 F.3d 439, 444 (7th Cir. 2006) (in negligent misrepresentation suit, speculative damages are not recoverable). Plaintiffs' negligent misrepresentation claim also must be dismissed for failure to adequately allege duty or justifiable reliance. Plaintiffs Have Not Sufficiently Alleged A Duty.
A claim for negligent misrepresentation requires the existence of a duty to avoid negligently conveying false information, which arises when "one is in the business of supplying information for the guidance of others in their business transactions."
lnc., 181 Ill. 2d 178, 183-84 (1998)( citing Moorman Brogan v. Mitchell Int
MIg. CO. v. Nat 'I Tank Co., 91 Ill. 2d 69,
88-89 (1982». Illinois courts have held that pure information providers, i. e., those whose product is "ideas," "information" and "analy] sis]," are in the business of supplying information, while those who supply information only incidentally to the sale of the product or service, are not in the business of supplying information. See Fox Assocs., Inc. v. Robert HalfInt
'I, Inc., 334 Ill. App.
3d 90, 94-95 (1st Dist. 2002) (pure information providers include accountants, banks that provide credit information to lenders, aircraft inspectors, inventory inspectors, termite inspectors, title insurers, real estate brokers, and stockbrokers; by contrast, those held not to be information providers include manufacturers and sellers of computers and software, roofing materials, and electrical supplies and architects and engineers). Plaintiffs have not alleged that DePaul is in the business of supplying information to others for guidance in their business transactions. See id. at 95-96 (whether an entity is in the business of supplying information "is a legal conclusion that must be supported by well-pled
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Nor could Plaintiffs establish that DePaul is in the business of supplying
DePaul's mission is educating students. Even assuming that this could be
construed as being in the business of providing information, DePaul is not in the business of providing the particular type of information Plaintiffs challenge. Instead, DePaul provides historical employment data collected from its graduates only incidental to its mission of educating students. See Lozosky v. Illinois, 54 Ill. Ct. Cl. 470, 474-75 (2001) ("[E]ven assuming arguendo that the University is generally in the business of information, as if higher education can be so simplistically characterized for purposes of this arcane legal analysis-it seems clear
... that the University is not in the business of supplying this particular kind of information [i. e., insurance coverage information] and certainly not for the guidance of others in their business transactions ... ") (emphasis in original). Because Plaintiffs have not alleged the existence of a legal duty, their negligent misrepresentation claim should be dismissed. 2. Plaintiffs Have Not Alleged Reasonable Reliance.
Each of the Plaintiffs makes the identical generalized assertion that he or she relied on DePaul's "Employment Information," defined as salary and employment information reported by students graduating in 2009, 2007 and 2005 and published in DePaul's marketing materials. (See Compo ~~ 10-18, 36.) This conclusory statement fails adequately to allege reliance and that failure is fatal to Plaintiffs' negligent misrepresentation claim. See Dloogatch, 396 Ill. App. 3d at 849-50 (plaintiffs failed to plead reliance with sufficient specificity to withstand motion to dismiss; allegation in complaint that "plaintiffs relied on  audit opinion letters," without more, "is simply a conclusory statement that gives no insight into facts that plaintiffs would ever be able to prove to support that claim"); Guzman v. Bridgepoint Educ., Inc., No. II-cv-69 WQH
(WVG), 2011 WL 4964970, at *6 (S.D. Cal. Oct. 19,2011) (in negligent misrepresentation
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student's allegation that she "relied on the defendant's misrepresentations and omissions in deciding to enroll" at academic institution was conclusory and failed sufficiently to allege reliance). Even assuming that Plaintiffs' generalized reference to reliance is sufficient, their negligent misrepresentation claim fails because any reliance upon employment and salary data reported to DePaul by students and alumni was unreasonable as a matter of law. To prevail on a claim of negligent misrepresentation, a plaintiff must plead facts sufficient to show that reliance was reasonable. See Neptuno Treuhand-Und Verwaltungsgesellschaft Mbh v. Arbor, 295 Ill.
App. 3d 567, 575 (lst Dist. 1998). The issue of reliance may be determined as a matter of law when "it is apparent from the undisputed facts  that only one conclusion can be drawn." Id. In Gomez, on almost identical facts, the court noted that plaintiffs "were among the select segment of students accepted into an American law school" and "were making a substantial economic commitment." Gomez, Exhibit A at 29-30. In this context, and given the amount of public ally
available information on law schools and the very public nature of the recession, the court concluded that plaintiffs could not have reasonably relied on the law school's alleged misrepresentations because it "simply [was] not plausible that NYLS' s data  was the predicate on which plaintiffs relied to conclude they were guaranteed ajob in the legal profession, commensurate with their education, within nine months of graduation." true in this case. ld. The same equally is
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PLAINTIFFS' ICFA CLAIM SHOULD BE DISMISSED UNDER 735 ILCS 5/2619 BECAUSE DEPAUL'S STATEMENTS FALL WITHIN ICFA'S SAFE HARBOR PROVISION.13 The ICF A exempts conduct "specifically authorized by laws administered by any
regulatory body or officer acting under statutory authority of this State or the United States." 815 ILCS 505/1 Ob(1). As an ABA accredited law school, DePaul must report its employment statistics pursuant to ABA Standard 509. (CompI. ~~ 32, 47.) ABA Standard 509 is promulgated under the specific requirements of the Higher Education Act ("HEA"), 20 U.S.c. § 1001 et seq., and Department of Education ("DOE") regulations, 34 C.F.R. § 668.41 et seq. HEA applies to all institutions of higher education, including accredited law schools. See 20 U.s.C. §§ IOOI(a), I002(a)(I)(A), I002(b). The statute requires schools to provide prospective
and enrolled students with information concerning employment and graduation statistics. See 20 U.S.C. §§ I092(a)(l)(R), I092(c), I094(a)(8). HEA authorizes the DOE to promulgate
regulations regarding information requirements and select accrediting agencies to ensure that consumer information is disclosed based on the federal guidelines. 20 U.S.c. § 1221e-3 (authorizing DOE to adopt regulations governing law schools and other institutions of higher education); 20 U.S.c. § I099b (delegating authority to DOE to select accrediting agencies or associations); 34 C.F.R. § 668.4I(d)(5) (setting forth DOE's requirements for the timing, source and disclosure of post-graduation data by schools). The DOE recognizes the Council of the Section of Legal Education and Admissions to the Bar and the Accreditation Committee of the ABA as the accrediting agency for law schools. See 20 USC § 1099(b); Recognition of
13 With respect to the part of its motion seeking dismissal of Plaintiffs' ICFA claims based on the ICFA's safe harbor provision, DePaul proceeds pursuant to 735 ILCS 5/2-619(a)(9), which provides in relevant part that "[djefendant may, within the time for pleading, file a motion for dismissal of the action or for other appropriate reliefupon any of the following grounds ... that the claim asserted against defendant is barred by other affirmative matter avoiding the legal effect of or defeating the claim."
- 17 -
Accrediting Agencies, 73 Fed. Reg. 11404, 11405 (Mar. 3, 2008) (recognizing the ABA as a nationally recognized accrediting agency). As the federally-appointed accrediting agency, the ABA establishes standards for law schools to become or remain accredited, which include requirements for collecting, calculating and disclosing post-graduation information. The ABA's official interpretations of Standard 509 recite "categories of consumer information [that] are considered basic," including "placement rates," and provide two means by which a law school may satisfy the Standard.
law school complies with ABA information publishing requirements either by (1) providing the information to a publication designated by the Council, such as the NALP, or (2) publishing the information in its own publication. See id. Here, DePaul has provided the required placement data to NALP in every year pertinent to the Complaint. (Compl. ~ 41.) As a matter of law, DePaul's compliance with ABA Standard 509 requires dismissal of the IeF A claim. See Franks v. Rockenbach
Chevrolet Sales, Inc., No. 95 C 6266, 1998 WL
919714, at **4-5 (ND. Ill. Dec. 30, 1998); Jackson v. South Holland Dodge, Inc., 197 Ill. 2d 39, 50 (2001) (dismissing ICF A claim on ground that "compliance with the disclosure requirements of [the Truth in Lending Act] is a defense to the [ICF A] claim against Chrysler in this case. "). III. CLAIMS AGAINST THE DOE DEFENDANTS SHOULD BE DISMISSED UNDER 735 ILCS 5/2-619 FOR LACK OF SUBJECT MATTER JURISDICTION. IS The claims against the Doe Defendants should be dismissed under 735 ILCS 5/2619(a)(l) for lack of subject matter jurisdiction.
In Illinois, in the absence of explicit statutory
See AMERICAN BAR ASSOCIATION, tandards and Rules of Procedure for Approved Law Schools, Chapter 5: S Admissions and Student Services, available at http://www.americanbar.orglgroups/legal_ educationlresources/standards.html (last visited May 23, 2012).
15 Section 5/2-619(a)( 1) provides in relevant part that the "Defendant may, within the time for pleading, file a motion for dismissal of the action or for other appropriate relief' upon the ground that "the court does not have jurisdiction of the subject matter of the action, provided the defect cannot be removed by a transfer of the case to a court having jurisdiction."
- 18 -
authority to the contrary, suits against fictitious parties are void ab initio. See Bogseth v. Emanual, 166 III. 2d 507, 513 (1995) ("Illinois courts have historically and uniformly held that suits brought against fictitious parties are void ab initio. "); Hailey v. Interstate Mach. Co.. 121
III. App. 3d 237,238 (1984). Plaintiffs charge that certain unidentified Doe Defendants (also
called Lawyer Defendants) "either personally made or disseminated the false and misleading representations contained herein or contributed to the acts and practices alleged herein." (Com pI. ~~ 21,23.) Because suits against fictitious parties are void, the claims against the Doe
Defendants should be dismissed. CONCLUSION For all of the foregoing reasons, DePaul respectfully requests that the Complaint be dismissed in its entirety, with prejudice.
Additionally, because Plaintiffs make the same allegations against the Doe Defendants as they make against DePaul, (see Compl. ~~ 124, 131), for the same reasons that the claims against DePaul should be dismissed. the claims against the Doe Defendants should also be dismissed.
- 19 -
Dated: May 24, 2012
Lawrence C. DiNardo (3128594) lcdinardo@JonesDay.com Tina M. Tabacchi (6210961) tmtabacchi@JonesDay.com Anna K. Hartog (6286348) email@example.com
77 West Wacker, Suite 3500 Chicago, IL 60601 T: (312) 782-3939 F: (312) 782-8585 Norman B. Berger (6180053) firstname.lastname@example.org Michael D. Hayes (6187607) email@example.com
VARGA BERGER LEDSKY HAYES & CASEY
125 South Wacker, Suite 2150 Chicago, IL 60606 T: (312) 341-9400 F: (312) 419-0225
- 20 -
CERTIFICATE OF SERVICE I hereby certify that a copy of the foregoing MEMORANDUM OF LA W IN SUPPORT OF DEFENDANT'S COMBINED MOTION TO DISMISS PLAINTIFFS' FIRST AMENDED AND 2-619 has been
CLASS ACTION COMPLAINT PURSUANT TO 735 ILCS 5/2-615
served this 24th day of May, 2012 by depositing a copy of the same in the United States mail, tlrst class postage prepaid, and properly addressed to the following counsel of record:
Edward X. Clinton, Sr. Edward X. Clinton, Jr. The Law Office of Edward X. Clinton, P.C. 111 W. Washington Street, Suite 1437 Chicago, Illinois 60602 Phone: 312.462.0405 E-mail: firstname.lastname@example.org email@example.com Jesse Strauss Strauss Law PLLC 305 Broadway, 9th Fl. New York, NY 10007 Phone: 212.822.1496 Fax: 212.822.1437 E-mail:firstname.lastname@example.org
David Anziska The Law Offices of David Anziska 305 Broadway, 9th Floor New York, NY 10007 Phone: 212.822.1496 Fax: 212.822.1437 E-mail: email@example.com
Attorney for DePaul Univ rs tyalk/a DePaul University College of Law
Gomez-Jimenez et ai. v. New York Law Sch. et al., No. 652226/2011 at 30 (N.Y. Sup. Ct. Mar. 21, 2012)
NEW YORK COUNTY CLERK
INDEX NO. 652226/2011 RECEIVED NYSCEF'_03/21/2012
NYSCEF DOC. NO. 22
SUPREME COURT OF THE STATE OF NEW YORK PRESENT:
NEW YORK COUNty PART
kELVIN L. SCJ.lt..Jern.ff?.
-vMOTION SEa. NO. MOTION CAL. NO.
The following papers, numbered 1 to __
were read on this motion to/for
Notice of Motionl Order to Show Cause - Affidavits - Exhibits ...
Answering Affidavits - Exhibits Replying Affidavits
oJ: LLJ ....
u.. .... U
< o z
, 20/)..MELVIN . SCHWEITZE~'
Check if appropriate:
o SUBMIT ORDER/JUDG.
DO NOT POST
SETTLE ORDER /JUDG.
SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: PART 45 ALEXANDRA GOMEZ-JIMENEZ, SCOTT TIEDKE, KA THERlNE COOPER, MATTHEW CRAWFORD, GEOFFREY CORISDEO, SOLINE McLAIN, RENEE RIVAS, GERGANA MITEV A, and CHLOE GILGAN on behalf of themselves and all others similarly situated, Plaintiffs, -againstNEW YORK LA W SCHOOL, and DOES 1-20, Defendants.
DECISION AND ORDER Sequence No. 002
L. SCHWEITZER, J.:
This is a motion to dismiss a complaint brought by nine graduates of New York Law School (NYLS) who allege that data published by their school pertaining to the school's graduates' employment and salaries is misleading and, in fact, fraudulent.
They assert that in
having relied on this misleading information to make their decision to attend NYLS, they now find themselves in disadvantaged employment positions and, consequently, they seek damages
equal to the difference between the alleged inflated tuition they paid because of the allegedly misleading statements and what they characterize as the "true value" of a NYLS degree, together with certain expenses they incurred.
IPlaintiffs also allege that they are acting for themselves and, purportedly, "for all persons who currently attend or graduated" from the school during the time period from August I I, 2005 to the present (the Class Period).
Background NYLS enrolls approximately 1,500 students. Tuition is $47,800 per annum. Amended
Complaint, , 10. According to plaintiffs, NYLS has been able to attract a large number of applicants and charge an expensive price for its educational services because the school has disseminated this misleading information about its graduates' employment profiles. Allegedly,
the misleading information has caused prospective students to misjudge post-graduate employment prospects and commit to earning a NYLS degree which has less marketplace currency than they reasonably had expected. Plaintiffs allege that many of the school's working paying barely enough to Id.," 3-5. and is currently
graduates in the legal sector hold part-time or temporary employment,
service the debt incurred to finance their law school tuition and expenses. Plaintiff Alexandra Gomez-Jimenez
attended NYLS between 2004-2007
a member in good standing of the New York Bar. After graduating in 2007, Ms. Gomez-Jimenez secured full-time, permanent employment in April 2008. However, in 2009 she decided to open her own firm and now "enjoys a thriving practice as an immigration Plaintiff Chloe Giligan attended NYLS between 2005-2008. attorney." Id., ~ 17.
Ms. Giligan used to be a
member in good standing of the New York Bar "until she voluntarily assumed inactive status due to the fact that she was unable to obtain gainful employment in the legal industry[,)" despite
being in the top 15 percent of her class. Since graduating from law school, Ms. Giligan first worked as a saleswoman in a department store and then as a legal secretary in a small law firm. Currently, she lives in England and does not practice law. Id., 25.
Plaintiffs Scott Tiedke and Gergana Miteva attended NYLS between 2006-2009 and are both currently members in good standing of the New York Bar. Since graduating 2 from law
school, Mr. Tiedke has worked as a legal compliance officer at an investment management
and Ms. Miteva worked as a contract attorney and has recently found permanent employment.
Plaintiffs Katherine Cooper, Mathew Crawford, Geoffrey Corisdeo and Soline Mcl.ain attended NYLS between 2007-2010. Mrs. Cooper is currently a member in good standing of the
New York Bar. Since graduating from law school, she was unable to find any type of legal position until August 2011 when she found temporary, contract work. Mr. Corisdeo is currently a member in good standing of both the New York and New Jersey Bars. He currently works as an associate at a New Jersey law firm. Both Mr. Crawford and Ms. Mcl.ain are currently waiting to be admitted to the New York Bar. Since graduating from law school, Mr. Crawford has been "unable to find a permanent position in the legal industry." "steady employment" Ms. McLain was unable to find
for seven months after graduation, despite being on NYLS Law Review, a
Dean's Scholar and a John Marshall Harlan Scholar, and a member in good standing of the Louisiana Bar. ld., ~~ 19-22. Plaintiff Renee Rivas attended NYLS between 2008-2011. Ms. Rivas took the New York
Bar Exam in July 20 II, and is currently working as a paralegal at a small Manhattan law firm. She is the only graduate of the nine plaintiffs to have chosen to enter NYLS in 2008, the year the Great Recession began, which according to the complaint, "decimated 23, 50. With the exception of Ms. Gomez-Jimenez the legal industry."
who graduated before the Great Recession hit
and is now in a "thriving" practice, the remaining seven plaintiffs all entered NYLS before the Great Recession and graduated right into it.
The allegedly misleading information was disseminated
for the entering classes 2005-
2010. Id., ~~ 17-25. According to the complaint, the NYLS data allegedly omitted facts which, in plaintiffs' view, would have given prospective students a more accurate picture ofNYLS's post-graduation employment prospects. For example, plaintiffs allege the data consistently graduates secured employment within nine
reported that approximately
90-92 percent ofNYLS
months of graduation, but did not report the percentage of graduates employed in part-time or temporary positions. According to plaintiffs, a graduate could be working part-time as a barista although such
in Starbucks - or toiling away in any job - and be deemed employed in 'business,'
employment is temporary and does not require a law degree. A contract attorney, without permanent employment, working in document review projects in a law firm, would be deemed
employed in private law practice under the NYLS profile. Id., ~~ 4, 42. The data allegedly inflated graduate mean salaries by reporting them based on a small, deliberately selected, intensely solicited, subset of graduates. from 22 to 26 percent, and the circumstances The subset of graduates ranged were not disclosed by
relating to its composition
NYLS. In two years, 2005 and 2006, NYLS did not report the percentage of graduates on which the compensation statistic was based at all. Id., ~ 43.
Plaintiffs also recite, without any factual reference, a litany of additional allegedly false representations and omissions of material facts, including false employment rates, employment
data which falsely gave the appearance that most graduates had secured full-time permanent employment for which a law degree was required, grossly inflated salaries, and false statements regarding the value of a NYLS degree. Plaintiffs claim the employment and salary data reported
by NYLS were at odds with national legal employment statistics reported and made available to
the public by the National Association for Law Placement (NALP) and with the reality of NYLS's ranking by the Us. News & World Report (US News). Id.", 4,5.
According to plaintiffs, the data for the graduating classes 2005-2009 differed in critical respects from the class of 20 I0 data in that data for the former years reported the percentage of graduates employed after nine months but did not report the percentage of graduates who held positions which required or preferred a law degree, or were funded by a NYLS Fellowship Program. Also, in some cases the data for 2005-2009 gave the average salary for graduates working for law firms, thus allegedly implying that most of the employed graduates were, in fact, working for law firms." The data pertaining to the NYLS class of2010, on the other hand, was more detailed and was obtained from employment surveys responded to by its graduates. Id., 4 I. Plaintiffs allege NYLS reported that, based on a response rate of 95 percent of its 20 10 class, approximately 92 percent of class members were employed nine months after graduation, 42 percent were working in private law practice, 27 percent in business, 17 percent in government, three percent in public interest, and three percent in both judicial clerkships and academia. Five percent were reported seeking employment and three percent were unemployed and not seeking employment. Five and one-half percent of employed graduates were reported as holding positions funded by a NYLS Fellowship Program, and approximately 80 percent of graduates were reported as holding positions that either required or preferred a law degree.
2Documentary evidence from the complaint itself shows that this allegation is not entirely accurate. According to plaintiffs' Amended Complaint, Exhibits 2-6, each year the data gave the percentage of graduates working in private practice, business and industry, government, judicial law clerks, public interest positions and academic positions. It also gave a breakdown for those graduates working in law firms and the percentage of graduates working there based on the size of the law firms as follows: solo practitioners, 2-25 attorneys, 26-100 attorneys, 101-500 attorneys, 50 I or more attorneys, and size of firm unknown. Finally, with respect to salaries, the data gave the median salaries for graduates respectively working in small-medium size law firms, large law firms, graduates working in business, in government and in public interest positions.
Based on a response rate of 26 percent of its 2010 employed graduates, NYLS reported respective average salaries of $ I 07,343 for those in private law practice, $86,667 for those in business and $56,910 for those in government. Plaintiffs assert three causes of action.
They allege that NYLS' s actions (i) constitute
unlawful, unfair, deceptive and fraudulent practices under N.Y. General Business Law (GBL) 349, (ii) are fraudulent in that NYLS disseminated representations and omissions information which contained numerous false
of material facts, and (iii) constitute negligent misrepresentation.
Standard of Review NYLS's motion to dismiss is under CPLR 3211 (a) (1) and (7). A CPLR 3211 (a) (7) motion "must be denied if the factual allegations contained in the complaint constitute a cause of action cognizable at law." Guggenheimer v Ginzburg, 43 NY2d 268 (1977). CPLR 3211 (a) (7) motion, the court must accept plaintiffs' allegations In considering a
as true and the complaint
must be accorded "the benefit of every possible favorable inference."
CMMF, LLC v J P.
Morgan Inv. Mgt Inc., 78 AD3d 562,565 (1st Dept 2010) (quoting Leon v Martinez, 84 NY2d
83,87 ). The CPLR 321 I (a) (7) test is not whether the complaint states a cause of action,
but whether plaintiffs have one. See Rovello v Orofino Realty Co., 40 NY2d 633, 634 (1976). However, factual allegations incredible or unequivocally [deferential) consideration." "that consist of bare legal conclusions, contradicted by documentary or that are inherently
evidence, are not entitled to
Leder v Spiegel, 31 AD3d 266, 267 (1 st Dept 2006); see also
Biondi v House Apartment Corp., 257 AD2d 76, 81 (Ist Dept 1999); Zanett Lombardier Ltd v Maslow, 29 AD3d 495, 496 (1st Dept 2006). A complaint may be dismissed based upon documentary evidence pursuant to CPLR 3211 (a) (1) only if the factual allegations are definitively contradicted by the evidence submitted. Yew Prospect, LLC v Szulman, 305 AD2d 588 (2d Dept 2003). Ambiguous documents cannot form the basis for a dismissal because a CPLR 3211 (a) (1) dismissal "may be appropriately granted only where the documentary evidence utterly refutes plaintiffs factual allegations, conclusively establishing a defense as a matter of law." Goshen v Mut. Life Ins. Co., 98 NY2d 314, 326 (2002). GBL 349 Claim To state a cause of action under GBL 349, a plaintiff must allege that the defendant's conduct was: (1) consumer oriented; (2) deceptive or misleading in a material way; and (3) that plaintiff suffered injury as a result. Oswego Laborers' Local 214 Pension Fund v Marine Midland Bank, NA., 85 NY2d 20, 25 (1995); Small v Lorillard Tobacco Co., 94 NY2d 43, 55 (1999). While the statute does not require an assertion of justifiable reliance, or the defendant's intent to deceive or mislead, a plaintiff must allege that defendant's consumer-oriented, deceptive acts or practices "resulted in actual injury to the plaintiff." Blue Cross & Blue Shield of N.J, Inc. v Philip Morris USA Inc., 3 NY3d 200 (2009); Oswego, 85 NY2d at 26; Baron v Pfizer, Inc., 42 AD3d 627, 629 (3d Dept 2007). ABA Standards for Legal Education Defendants assert what they believe to be a complete defense to plaintiffs' }BL 349 claim pursuant to GBL 349 (d) which provides in pertinent part: 7
"(d) In any such action it shall be a complete defense that the act or practice is ... subject to and complies with the rules and regulations of, and the statutes administered by ... any official department, division, commission or agency of the United States as such rules, regulations or statutes are interpreted by ... such department, division, commission or agency or the federal courts." The Higher Education Act (HEA) 20 U.S.C. 1001 et seq. sets forth the framework for student assistance in institutions of higher education. subject to its mandates. NYLS, which is such an institution, is activities for
HEA 1092 (a) provides for information dissemination
prospective and enrolled students in such institutions, and HEA 1092 (a) (I) (8) provides for the accurate description of "the placement in employment graduates of the institution's provides: "In the case of an institution that advertises job placement rates as a means of attracting students to enroll in the institution, the institution will make available to prospective students, at or before the time of application (A) the most recent available data concerning employment statistics, graduation statistics, and any other information necessary to substantiate the truthfulness of the advertisements .... " HEA 1221 e-3, in turn, authorizes the U.S. Department of Education (DOE) to adopt regulations governing law schools and other institutions of higher education. regulations are set out in 34 CFR 668.41 (d). Subparagraph The applicable of, and types of employment obtained by,
degree or certificate programs ... " Further, HEA 1094 (a) (8)
(d) (5) of this regulation provides student. ... [t]he degree or
that "[a]n institution must make available to any enrolled student or prospective placement of, and types of employment certificate programs." Additionally, obtained by, graduates of the institution's
the regulations provide that the information provided may
be obtained from alumni or student satisfaction surveys, that the institution must identify the
source of the information
and that the institution must disclose any placement rates it calculates.
34 CFR 668.41 (d) (5) (i), (ii) and (iii). HEA 1099 (b) authorizes the DOE to select "accrediting ensure that consumer information agencies or associations" to
is disclosed based on the federal regulations.
Since 1952, the to the Bar of
DOE has recognized the Council of the Section of Legal Education and Admissions the American Bar Association (the Council) as the accrediting association
for law schools. which
In 1996, the Council approved revised Standards for Legal Education (Standards) were then adopted by the American Bar Association House of Delegates.
Standard 509 requires
accredited law schools to publish basic consumer information in a fair and accurate manner, reflective of actual practice. Interpretation 509-1 (8) provides that placement rates and bar Interpretation 509-4 requires a law
passage data are considered basic consumer information.
school to fairly and accurately report basic consumer information wherever and whenever that information is published. In accordance with 34 CFR 668.41 (d) (5), the ABA's Annual Questionnaire ABA's requisites for data collection and reporting. The Questionnaire sets out the
requires that the data be
taken from the annual National Association for Law Placement Graduate Survey. This protocol dictates the manner in which law schools must collect and report post-graduation and salary data.' employment
)According to the complaint, the ABA and its Questionnaire have recently drawn considerable criticism from, inter alia, United States Senators who have questioned the effectiveness of the ABA's oversight and auditing of statistics reported by law schools. See e.g. Amended Complaint, Ex. 12 (Senators Barbara Boxer and Tom A. Coburn, M.D.). Indeed, plaintiffs allege that "nearly every [law] school to a certain degree blatantly manipulates their [sic] employment data .. " It is a dirty industry secret that law schools employ a variety of deceptive practices and accounting legerdemain." fd.,17.
Defendants argue that they have rigorously complied with the rules and regulations of an agency of the United States - the DOE - as such rules and regulations are interpreted by that agency and thus are accorded the defense of GBL 349 (d). They are mistaken. The rules and regulations with which they have arguably complied were written by the DOE pursuant to a grant of authority in the HEA. However, they have not been interpreted by that government agency but, rather, by an "association", private self-regulatory organization,
i.e. a national bar association akin to a
receiving a delegation of authority from the DOE. As an division,
association, it is clear that the interpreting party is not an "official department,
commission or agency of the United States" and, therefore, the defense provided by GBL 349 (d) is not available to defendants. If the State Legislature had intended to include associations as
interpreting bodies it could easily have done so, and did not. For this reason, the defense fails." Deceptive Acts and Practices: "The Reasonable Consumer" The New York Court of Appeals, concerned about what it termed a "tidal wave of litigation against businesses that was not intended by the Legislature" pursuant to GBL 349, or
adopted "an objective definition of deceptive acts and practices, whether representations
omissions, limited to those likely to mislead a reasonable consumer acting reasonably under the circumstances."
Oswego, 85 NY2d at 26 (emphasis added); Goshen, 98 NY2d at 324.
4"The problem of a delegation by a government agency, which is itself exercising statutorily delegated powers, to a private standard setting body like FfNRA [for example) further confounds the question of whether the private body either is exercising delegated governmental functions or is, indeed, a government entity. Yet such privatization of governmental functions has become increasingly common." Roberta S. Karmel, "Should Securities Industry Self-Regulatory Organization Be Considered Government Agencies?," 14 Stanford Journal of Law, Business & Finance 15 I, 156 (2008). See also the articles cited therein, n. 16: John J. Dilullo, Jr., Response Government by Proxy: A Faithful Overview, 116 Harv. L. Rev. 1271 (2002); Jody Freeman, The Private Role in Public Governance, 75 N.Y.U. L. Rev. 543 (2000); Gillian E. Metzger, Privatization as Delegation, 103 Colum. L. Rev. 1367 (2003); Steven J. Schwartz, Private Ordering, 97 Nw. U. L. Rev. 3 19(2002).
Therefore, plaintiffs must plead that NYLS has engaged "in an act or practice that is deceptive or misleading in a material way ... to a reasonable consumer." Jd.; Stutman v Chern. Bank, 95 NY2d 24, 29 (2000). Also, to the extent that allegations are not fact supported, they fail to state a GBL 349 claim. Free/all Express v Hudson River Trust, 16 Mise 3d 1135 (A), 2007 WL 2582222, at *4 (NY Sup Ct, September 7,2007). Here, the only fact-supported, allegedly misleading statements are (1) NYLS's failure to differentiate among types of employment when publishing its employment statistics and (2) NYLS' s publication of salary data based on a small group of students. The NYLS employment statistics for each year show data based on the graduates reporting their employment information. NYLS reported that 92 percent of its 2005 and 2006 classes reporting their employment information were employed within nine months of graduation. For the classes 0[2007, 2009, and 2010,5 NYLS reported employment rates of 92.3 percent, 89.7 percent and 91.9 percent, respectively, based on the graduates reporting their employment information. NYLS also disclosed that for the class of2007, 96 percent of the graduates reported employment information; for the class of2009, 94 percent of the graduates reported employment information; and for the class of 20 I0, 95 percent of the graduates reported employment information. Amended Complaint, Exs. 2-6.
5Plaintiffs have not attached any exhibits which show NYLS's representations with respect to the class of 2008, as they did with respect to the classes of2005, 2006, 2007, 2009 and 2010. However, they allege that based on "a representation that was published between 2008 and 2009[,)" the class of2008 "enjoyed a placement rate of92 percent within nine months of graduation[.)" Memorandum of Law in Opposition to Defendant New York Law School's Motion to Dismiss the First Amended Complaint (Memorandum in Opposition), 8 (citing Amended Complaint" 19). Also, the complaint alleges that "while [plaintiffs] were enrolled in NYLS the school posted on its website employment reports asserting that 92 percent of ... 2008 graduates secured employment within nine months of graduation." Amended Complaint, mlI9-23.
Plaintiffs allege that these statistics somehow deceptively
make it appear that the jobs
reported are all full-time permanent positions for which a law degree is required or preferred. They contend that in the circumstances where all applicants want a full-time law job, and are consumer
willing to take on in excess of $1 00,000 of debt to be eligible for one, any reasonable would infer NYLS's data was reporting full-time, permanent employment was required or preferred, thus purporting to demonstrate
for which a law degree No
success at finding employment.
such statement is made by NYLS in its marketing materials, however. The court does not view these post-graduate material way for a reasonable employment statistics to be misleading definition, in a
consumer acting reasonably.
reasonable subset of
consumers - college graduates - seriously considering law schools are a sophisticated education consumers, capable of sifting through data and weighing alternatives decision regarding their post-college options, such as applying for professional
before making a school. These
reasonable consumers have available to them any number of sources of information when making their decisions. Plaintiffs'
own complaint confirms the court's view. Plaintiffs cite NALP's employment ~~ 5, 64-65. on a
reports and various studies, initiatives and news articles. See Amended Complaint,
According to NALP, the percentage of graduates who found full-time legal employment national level is considerably more modest, i.e. 40 percent, than NYLS's
employment data for NYLS would suggest.
That this statistic provides context for the reasonable information is by
consumer of a legal education also suggests that more detailed employment available to the law school consumer through NALP's reports. plaintiffs' documentary
In fact, as demonstrated
evidence in Exhibits 19 and 20 to the complaint,
when the ABA recently
adopted measures that would require greater reporting transparency
Exhibit 19), the NALP Board of Directors was prompted to write to the ABA and express "NALP's strong objection to the actions taken by the Council with regard to the collection of law school employment prerogatives. data" as an encroachment upon NALP's own data collection and reporting
The letter, attached to the complaint, states:
"This will, in effect, duplicate the research effort that NALP has successfully undertaken for the last 37 years. We object to this action on several grounds, including the fact it will actually lead to LESS transparency and information about the entry-level legal employment market and not more .... " Amended Complaint, Ex. 20 (emphasis in italics added; emphasis in solid caps in original). Plaintiffs' complaint also compares NYLS with its law school peers as reflected in the that plaintiffs do not challenge the quality of the
rankings of US News. Notwithstanding
education they received, the complaint asserts that because NYLS finds itself in the bottom tier of the US News law school rankings, "logic dictates that NYLS's true employment below the statistical mean of the bell curve." rate would be
Amended Complaint, , 58. One would think that from US News that
reasonable consumers, armed with the publicly available information plaintiffs cite, thus would avail themselves of plaintiffs'
own logic as stated in their complaint
when it comes to evaluating their chances of obtaining the full-time legal job of their choice within nine months post-graduation. Indeed, the court takes judicial notice (see People v Darby, 263 AD2d 112, 114 [1st Dept 2000]) that US News, in addition to its general law school rankings to which plaintiffs themselves refer in their complaint, has published a plethora of information including NYLS, in a number of job-related ranking law schools,
categories including: "Whose graduates are the most
and least likely to land a job?," "Whose graduates earn the most? The Least?," "Where do
graduates work?," "Who's the priciest? Who's the cheapest?," "Whose graduates have the most debt? The Least?" 2d ed (2006).6 As to the salary data being misleading because it allegedly was based on a "deliberately selected" small sample of graduates, the relatively small percentage of responding disclosed whenever the salary data included the average salary statistic. students was
See, e.g., Ultimate Guide to Law Schools, US News and World, L.P. Report,
Namely, for the years
2010, 2009 and 2007, the NYLS marketing material clearly stated that the salary statistic was based on approximately graduates. 26 percent, 20 percent and 25 percent, respectively, of employed
See Amended Complaint, Exs. 2, 3,4. For 2005 and 2006, the NYLS marketing
materials merely disclosed a median or average range of salaries depending on employment settings graduates chose to work in and qualified the disclosure with the limiting phrase, "based
upon salaries reported." Amended Complaint, Exs. 5,6.
2006 ranged between $35,000 to $128,000.
The reported salaries for 2005 and
See id. In addition, the materials cautioned that the
highest reported salary for those years "is not the typical salary for most law school graduates in New York City and nationwide."
Id. Finally, there is simply no representation
in NYLS's of the
marketing materials that the sample of the reported salaries is in any way representative
salaries earned by all the employed graduates in a given year. The court thus finds that the
6The court notes that the entire subject of the collection and reporting of law school employment data is a source of much controversy today. Plaintiffs also cite a letter written in March 20 II from News to every law school dean in the nation informing them that the publication itself has modified how it calculates the employment rates that are used in its law school ratings and that it will be publishing more detailed employment data as part of new rankings. The letter, emphasizes that "[tJhe main responsibility to gather data and implement quality standards lies with the ABA [but that) .... [t)he ABA can't do it alone." The letter urges all schools to make sure that the information being reported is as accurate as possible and "to consider going beyond the current industry standards." In suggesting that metrics be added to total employment rates, the letter concludes, "[mlore data - on employment or other topics - is a positive factor for our readers and your students." Amended Complaint, Ex. 7.
documentary evidence of statements presenting salary data do not violate the prohibition against deceptive business practices as "there can be no [GBL 349] claim when the allegedly deceptive practice was fully disclosed."
Broder v MBNA Corp., 281 AD2d 369, 371 (1st Dept 2001); see
also Sands v Ticketmaster-N. Y., Inc., 207 AD2d 687 (1 st Dept 1994) ("the challenged business
practices do not violate the prohibition against deceptive business practices under [GBL 349], since the record shows that these practices are fully disclosed prior to the sale of the tickets")
(quoting Lewis v Hertz Corp., 181 AD2d 493, 494 [1st Dept 1992]); Zuckerman v BMG Direkt Mktg., Inc., 290 AD2d 330, 330-31 (1 st Dept 2002); Shovak v Long Island Commervcial Bank,
50 AD3d 1118, 1120 (2d Dept 2008). In researching law school options, it also should have come as no surprise to these law school consumers that the most lucrative law jobs often are associated with having attended a high ranking law school. Indeed, plaintiffs also characterize in their complaint NYLS's
"lackluster ranking and reputation" (Amended Complaint, ~ 9) and even quote one NYLS professor as acknowledging that "[a]t a law school like [NYLS], which is toward the bottom of
the pecking order, it's long been difficult for [NYLS] students to find high-paying jobs." Amended Complaint, ~ 32. These statements constitute further documentary evidence that a
reasonable consumer who is seriously considering NYLS is more likely to appreciate the nexus between higher law school rankings and commensurate employment and earning expectations.
is also difficult for the court to conceive that somehow lost on these plaintiffs is the fact that a goodly number of law school graduates toil (perhaps part-time) in drudgery or have less than hugely successful careers. NYLS applicants, as reasonable consumers of a legal education,
would have to be wearing blinders not to be aware of these well-established world of legal employment."
facts of life in the
The complaint also cites NYLS's statements on its website which address the fact that many students who have no intention of practicing law choose to attend law school and pay a significant sum to do so: "While the course of study leading to the Juris Doctorate degree is designed to prepare students to become practicing lawyers, the program is also ideal preparation for anyone whose work in other professions, in business, or in public service involves understanding law and lawyers." Amended Complaint, ~ 34. The widely held perception that a law degree from a respectable, accredited institution opens innumerable career paths beyond solely the practice of law, and leads to advancement fields is thus also an integral part of defendant's their own documentary evidence from defendant's marketing materials." in other
Choosing to disregard
marketing materials in this respect, plaintiffs
7The President of the State Bar of California, Bill Hebert, explained in "a much publicized article" (Amended Complaint, ,87) that, "based upon surveys published by [NALP). we know that the vast majority of graduates employed as full-time lawyers right out of school (about 76 percent) make far less than $160,000. Very few are lucky enough to get a six-figure job. For those who have full-time jobs as lawyers, the average salary is about $83K, and the salary generally clusters around $40-$60K. There is nothing wrong with a starting salary of $50,000, and over time law school grads probably make more than their non-lawyer peers. So compared to nonlawyers. over time we probably do better, in pure economic terms, than our non-lawyer friends." Amended Complaint, Ex. 17.
8The court takes judicial notice of a recent article in the New York State Bar Association Journal which provides informative background in this respect. "In the early 19705, the ABA created a Task Force on Professional Utilization to study what it called the 'oversupply of lawyers.' The final report of the Task Force concluded that while not all graduates could find work in law firms (especially the most prestigious ones), they did find work. Graduates also went to work in non-legal and non-law-related jobs in business, industry, government, education, private associations, NGOs, and virtually every other conceivable work environment. Every form of human endeavor encounters legal issues, and lawyers, whether they are practicing law or not, can address those legal issues. And lawyers bring with them a skill set that can be applied in a variety of different settings. What the Task Force found was that the job market cou ld absorb law school graduates - when there were fewer law firm jobs, more lawyers pursued alternative careers; and vice versa. One might argue that if you are not going to practice law, why should you go to law school? The answer is that a legal education provides training that will give you an advantage in the job market - both in getting the job and performing the job. What the Task Force discovered in the I 970s remains true today." Gary Munneke, Race to the Finish Line: Legal Education. Jobs and the Stuff Dreams Are Made Of, 84 NY State Bar Association Journal 2 (2012).
have selectively relied only on the relatively incomplete statistics of these materials and have mischaracterized them in their entirety as a deceptive enticement that makes it appear all jobs reported are full-time law jobs for which a law degree is required or preferred. In addition, every plaintiff alleges that in "deciding to remain enrolled at NYLS," he/she relied on the salary data and employment information posted on NYLS's website, marketing material and/or disseminated to third party data clearinghouses and publications. Amended Complaint, ~~ 17-25. Given the impact of the 2008 Great Recession on the legal job market as described in plaintiffs' complaint, see discussion, infra, NYLS's statements could not have been materially misleading to a reasonable consumer acting reasonably under the circumstances, i.e. taking into account the obvious, dramatic changes in the economy as they began to impact the legal profession. In sum, reasonable consumers would have considered and compared the NYLS statements on employment and compensation along with other 'decision factors' such as other sources of data cited in the complaint, career preference cited in the complaint, i.e. obtaining a law degree for purposes other than practice of law, available financial resources, and economic circumstances in the law business cited in the complaint, all of which would have had to play an important part in reasonable consumers' investigation when deciding whether to commit to attend NYLS and to complete their legal education there. See Lincoln Life and Annuity Co. of New York v Bernstein, 24 Misc 3d 121I(A), 2009 WL 1912468, at *7 (NY Sup Ct, June 29, 2009) ("[TJhe reasonable consumer does not mean the least sophisticated consumer. "), In that context, NYLS's acts and practices complained of by these plaintiffs do not fit the objective
definition of "deceptive"
when viewed through the lens of the "reasonable
reasonably under the circumstances." Damages: Remote and Speculative
Oswego, 85 NY2d at 26.
The court is also of the view that plaintiffs'
GBL 349 claim fails to satisfy the statute's
requirement that the actual injury each plaintiff sustained as a result of the misleading statements be identified.
See Stutman, 95 NY2d at 29; In re Coordinated Title Ins. Cases,2 Mise 3d
1007(A), 2004 WL 690380, at *7 (NY Sup Court, January 8, 2004) (citing Small, 94 NY2d at 55). In their Opposition Memorandum, time, permanent employment plaintiffs claim they "enrolled in NYLS to obtain full Opposition Memorandum at 12. However,
in the legal industry."
as they explained on oral argument, their claim for damages is not based on NYLS' s job guarantees, but on NYLS's mislabeled product. In their argument for damages, plaintiffs are essentially asking the court to "accept
true" (Leon, 84 NY2d at 87) their allegation that a NYLS degree is worth less than what NYLS allegedly represented it to be in its marketing materials. Then, they purport to measure their full-time, permanent at any
damages as the difference in value between "a degree where a high paying,
job was highly likely and ... raj degree where full-time, permanent legal employment salary, let alone a high salary, is scarce, as is the case in the legal market." plaintiffs seek "restitution and disgorgement Accordingly,
of all tuition monies remitted to NYLS, totaling
$225 million, which is the difference between the inflated tuition paid by class members based on the material misrepresentations ... and the true value of a NYLS degree[.]" Amended
Complaint, Prayer for Relief. In addition, plaintiffs claim that NYLS's deceptive and misleading
employment reports caused them to incur numerous "consequential loans, books, traveling and housing expenses. As the court noted earlier, plaintiffs'
costs" such as interest on at 13.
sole objection to the degrees they earned at NYLS is
purely in employment terms. To show that the value of a NYLS degree was inflated, plaintiffs allege that "many NYLS graduates are ... working in dead-end jobs, doing document review and other menial, mindless drudgery, essentially functioning as glorified paralegals with little control over their careers." to provide compensation or secretaries
Amended Complaint, ~ 82. This type of work is said not
and a lifestyle worthy of the time, money and sacrifice plaintiffs Amended Complaint, ~ 70.9
invested in earning a NYLS degree.
Although Small and Pfizer allow plaintiffs to allege damages in the form of price inflation, i.e. the difference between the allegedly inflated tuition paid and the "true value" of a
9New York law has been interpreted as not providing a cause of action for refund of the purchase price of a service on the basis that it would not have been purchased absent defendant's acts or practices. Small, 94 NY2d 43; Pfizer, 42 AD3d at 629. Each plaintiff asserts that "[h]ad [he/she] been aware NYLS's reported placement rates included temporary and part-time employment and/or employment for which a JD was not required or preferred, [he or she] would have elected to either pay less to NYLS or, perhaps, not attend the school at all." Amended Complaint, ~, 17-25. In order to avoid the Small and Pfizer outcome, plaintiffs argue for damages based on the difference between the inflated tuition and the true value of a NYLS degree. NYLS argues that plaintiffs have not alleged facts to show how the cost of tuition was affected by the alleged misrepresentations and omissions. It further argues that, in attempting to avoid Small and Pfizer, plaintiffs cite cases in which complaints specified how a purchase price was allegedly inflated. See Waldman v New Chapter, Inc, 714 F Supp 2d 398, 404 (EDNY 2010); Ackerman v Coca-Cola Co., 2010 WL 2925955, *3 (EDNY July 21, 2010); Rodriguez v /t 's Just Lunch, Int'l, No., 2010 U.S. Dis!. LEXIS 16622, at *31 (SONY Feb 23,2010). According to defendants, this is not what plaintiffs have done here. The court disagrees. Plaintiffs do allege that NYLS's marketing materials contain deceptive statements that are geared to making a consumer of education believe he/she is buying a degree which is more valuable than it really is. See Amended Complaint j'[ 29-32, 65; Opposition Memorandum at 1-3. This is not '''the reimbursement of the purchase cost' that the Court of Appeals rejected in Smail." Reply Memorandum at 5. However, even if plaintiffs have avoided Small and Pfizer, that does not cure the real infirmity with plaintiffs' damages theory. What plaintiffs seek is the difference between what they paid for their NYLS degrees in reliance on the representations contained in the marketing materials and what the degrees were intrinsically worth. This theory is far too speculative to formulate a valid claim for damages. See discussion, infra.
NYLS degree, the complaint does not allege facts from which pecuniary damages can be inferred as a direct result of the alleged wrong. NYLS claims the instant case is analogous to Mihalakis v Cabrini Med. Ctr., 151 AD2d 345, 346 (I st Dept 1985) lv dismissed 75 NY2d 790 (1990), where a medical student alleged the hospital had misrepresented aspects of its internship, making it
seem superior to what it actually was. The student asserted, had she known the facts, she would have selected another hospital to serve her internship. Here, plaintiffs similarly allege that had
they known the "truth" they would have elected "to pay less to NYLS or perhaps not attend the school at all." Amended Complaint, ~~ 17-25. The court in Mihalakis dismissed the action: "The cause of action for fraud should have been dismissed since it does not allege facts from which can be inferred any pecuniary, out-of-pocket losses as a direct result of the wrong (cf., Hanlon v Macfadden Publs., 302 NY 502). The measure of damages in a fraud action is the difference between the value of what was given up and what was received in exchange, all elements of profit to be excluded (Reno v Bull, 226 NY 546, 553). Thus, it would seem that the loss here would have to be measured by the difference between the value of the internship program provided by defendants and the value of an internship program having the characteristics that defendants represented to plaintiff Cabrini had but did not. We think it evident that any such measurement must be rejected as speculative." Mihalakis, 151 AD2d at 346. Plaintiffs try to distinguish Mihalakis by arguing that "plaintiff in Mihalakis was suing for $345,324,000 the defendant's in lost earnings caused by alleged deficient, yet unquantifiable, internship program." Memorandum 'characteristics' in
in Opposition at 24. In other words,
plaintiff in that case claimed she gave up an opportunity to complete an internship program having the characteristics that defendant hospital allegedly represented its program had but did As a result
not, in exchange for the "true value" of the internship program she actually attended. of the alleged defects in defendant's
program, she claimed she failed to complete the program
and to ultimately become a physician.
Hence, she sought damages "representing Mihalakis,
lifetime prospective earnings as a physician." hand, each plaintiff gave up approximately
151 AD2d at 345. Here, on the other
$47,800 in tuition plus other costs per annum for at any salary, at
three years in exchange for "a degree where full-time, permanent legal employment let alone a high salary, is scarce, as is the case in the legal market." Opposition
24. Unlike in Mihalakis, the value of what was given up by plaintiffs is known here. What remains to be determined, degree. Despite the factual differences between this case and Mihalakis, the court is of the opinion that the general rule set forth in Mihalakis is applicable here. Namely, the court there refused to speculate as to both the "true value" of an internship program and the value of an internship program having the characteristics that defendants allegedly misrepresented. See according to plaintiffs, is to measure the "true value" of a NYLS
Mihalakis, supra. Other courts have also declined to entertain similarly speculative For example, in Barrows v Forest Laboratories. their pharmaceutical
Inc., 742 F2d 54 (2d Cir 1984), plaintiffs sold Inc. (Forest)
business valued at $550,000 to defendant Forest Laboratories,
in exchange for 22,000 shares of Forest's common stock. After the sale, Forest publicly disclosed that its officers had engaged in a scheme to misstate Forest's financial condition and earnings. Plaintiffs then filed a suit against Forest seeking, inter alia, damages based on the
difference between the actual value of the stock at the time of the sale and the "grossly inflated" value as a result of the fraud perpetrated by plaintiffs. The Second Circuit ruled:
"[Plaintiffs'] proposed claim [for damages] is based on the value the stock purportedly would have had if Forest's true financial condition had been publicly known at the time
of the transaction, clearly a speculative proposition. Equally speculative is the question whether the parties would have reached any agreement if Forest's true financial condition had been known .... A claim for benefit-of-the-bargain damages must be based on the bargain that was actually struck, not on a bargain whose terms must be supplied by hypotheses about what parties would have done if the circumstances surrounding their transaction had been different." ld. at 60. This is precisely the sort of impermissible here. While not denying that they received a quality education at NYLS, plaintiffs are asking this court to measure the "true value" of a NYLS degree which allegedly misrepresented chances that NYLS graduates could obtain full-time, permanent employment degree was required or preferred. On oral argument, plaintiffs emphasized: the speculation plaintiffs are asking the court to engage in
for which a J.D.
"Your Honor, we're here today not talking about whether or not New York Law School guaranteed a job to our clients. That claim appears nowhere in the complaint .... This is a case about a product being mislabeled; and because that product is mislabeled, the law school can charge a premium for it. . " We believe through expert testimony ... you can measure the difference between a degree where you have a 40 percent or 30 percent chance of getting a job, and the degree that New York Law School misled ... our clients in getting which was a degree where you have a 90 percent chance of ajob[.)" The starting point of any such measurement is beyond this court, and perhaps this is why
plaintiffs fail to allege any method by which any theoretical damages ever could be calculated . . Measuring damages the way plaintiffs would have it would be speculative for another
reason as well. As noted earlier, eight of the nine plaintiffs here graduated NYLS between 200820 II, directly into the Great Recession and its aftermath with the exception of Ms. Gomez-Jiminez who graduated in 2007. Plaintiffs' own complaint acknowledges that one
would have to "bury [hislher] head in the sand" to miss the "brutal reality of the current economic environrnent[,)" and that we are witnessing "one of the grimmest legal job markets in
Amended Complaint, ~~ 60-62. In their complaint, plaintiffs describe the dire circumstances in detail:
situation of these supervening
"Since 2008 alone, the largest 250 law firms in the country have eliminated 10,000 positions, while commoditized, legal-entry work such as document review is increasingly being outsourced to countries outside the US, such as India. The entry-level employment offer rate for 2009 summer associates was at a historic low of 69 percent, as compared to 90 percent in 2008 and 93 percent in 2007. Scores of law firms have cancelled summer programs, and in a recent survey 55 percent of law schools reported a decrease of 30 percent or more of the number of firms doing on-campus interviews, an unprecedented decline. In another survey, only 3 percent of on-campus recruiters indicated that they were looking to hire third-year law students, as compared to 25 percent in 2008 and 42 percent in 2007." Amended Complaint, ~ 61. Another illustrative example is plaintiffs' Exhibit 14, which is a letter from a United States
Senator Charles E. Grassley to the President of the ABA regarding, inter alia, an article published by the ABA on law school graduates' employment prospects: "In November 2009, the ABA Commission on the Impact of the Economic Crises on the Profession and Legal Needs published an article that '[sjtudents are now competing for half as many jobs at top law firms ... as last year,' and that' [r]ecruitment at many levels of the job market is declining by similar amounts.' The article describes the employment prospects of the class of 2009 and 20 I0 as 'bleak' and speculates that 'many members of the class of 20 10 and 2011 may graduate without a job.' Not only do recent graduates face bleak job prospects, they borrow on average $71,436 at public schools and $91,506 at private schools." Amended Complaint, Ex. 15. For a good summary of the "bleak" employment prospects for all law school graduates, including NYLS's, the court is again compelled to cite plaintiffs' own words in opposition to defendants' motion: The legal employment market is highly oversaturated, with 43,000 new lawyers minted each year while roughly half as many jobs are available (26,000) making it unlikely that NYLS graduates are obtaining full-time employment for which a law degree is required at the rates reported by NYLS due to its poor academic reputation. Opposition Memorandum at 5 (citing Amended Complaint ~~ 50, 64).
In these new and troubling times, the reasonable consumer of legal education must realize that these omnipresent realities of the market obviously trump any allegedly overly optimistic Under New York law, "[f]rustration and
claims in their law school's marketing materials. disappointed expectations
do not of themselves give a rise to a cognizable
cause of action."
Goldberg v Manhattan Ford Lincoln-Mercury, 129 Mise 2d 123, 129 (NY Sup Court 1985); see also Polzer v TRW, Inc., 256 AD2d 248, 249 (I st Dept 1998). The alleged misstatements
NYLS's marketing materials themselves became obsolete statements as a result of the bleak prospects for legal employment unanticipated "decimat[ion as a result of the Great Recession. That such a widely-known, itself occurred
of] the legal industry" as portrayed in the complaint
after plaintiffs entered NYLS belies their argument for damages based on NYLS's marketing
materials allegedly misrepresenting be worthy of their investments. the likelihood of obtaining legal jobs that plaintiffs believe to
Amended Complaint, ~ 50. To measure damages based on the
difference in value between a degree which guarantees a good legal job, as defined by plaintiffs, and one that does not, against the background of the remote, supervening Recession, would require the court to engage in naked speculation. Fraud Claim To plead a fraud under New York law, plaintiffs must allege (i) a false representation material fact or material omission, (ii) scienter, (iii) reliance, and (iv) damages
impact of the Great
This the court cannot do.
Co. v Smith Barney, 88 NY2d 413 (1996); Small, 94 NY2d at 51.
IOThecourt already has rejected plaintiffs' damages claim as remote and speculative in the GBL context. The same is true with respect to plaintiffs' common law fraud cause of action.
On a motion to dismiss a fraud claim, the court takes the alleged facts "in the light most favorable to the nonmoving party, and according that party the benefit of every favorable inference, determiners] only whether the facts as alleged are cognizable within the claim asserted
to [CPLR] section 3016 (b)'s satisfaction." NY3d 486, 492 (2008).
Pludeman v Northern Leasing Systems, Inc., 10
CPLR 30 16 (b) provides that when the cause of action is based in fraud, "the circumstances constituting the wrong shall be stated in detail."
Mandarin Trading Ltd. v
Wildenstein, 16 NY3d 173, 178 (2011). However, the New York Court of Appeals has cautioned
that "section 3016 (b) should not be so strictly interpreted 'as to prevent an otherwise valid cause of action in situations where it is impossible to state in detail the circumstances fraud' [because] [t]he purpose of section 3016 (b)'s pleading requirement constituting
is to inform a
defendant with respect to the incidents complained of." Pludeman, 10 NY3d at 491 (citing Lanzi
v Brooks, 43 NY2d 778, 780 ); Mandarin Trading, 16 NY3d at 178; Knight Securities L.P. v Fiduciary Trust Co., 5 AD3d 172 (1 st Dept 2004). As a result, "3016 (b) may be met
when the facts are sufficient to permit reasonable inference of the alleged conduct." 10 NY3d at 492. False Representation of Material Fact or Omission which the court considers specific enough to analyze
The only alleged misrepresentations
are those already discussed in the court's decision with respect to GBL 349. They were found wanting there, and they are equally so here. In their Opposition Memorandum, plaintiffs argue that NYLS also committed fraudulent concealment. cause of action for fraud may be predicated on acts of concealment, however,
In New York, "[a]lthough a there must first be proven a
duty to disclose material information."
Dembeck v 220 Cent. Park South, LLC, 33 AD3d 491,
ha[s] special or superior has communicated
492 (1st Dept 2006). A duty to disclose exists where "defendant
knowledge of the facts not available to the other party, or where the defendant half-truth or made some other misleading, partial disclosure."
M&T Bank Corp.
CDO VII. Ltd., 23 Misc 3d 1105(A), 2009 WL 921381, at *8 (NY Sup Court, April 7, 2009) (citing Dembeck, 33 AD3d 491; Williams v Sidley Austin Brown & Wood, LLP, 38 AD3d 219,
220 [1st Dept 2007]). According to plaintiffs, NYLS had a duty to clarify in its marketing included non-legal, temporary and part-time rate includes graduates NYLS itself employs on a
materials "(1) that its definition of 'employment' employment, (2) that the reported employment
temporary basis; and (3) that NYLS's reported median and mean salaries are drawn from high earners and lower salaries earned in part-time and temporary employment Opposition Memorandum Plaintiffs' at 20-21. First of all, as the court already discussed, the are excluded."
arguments are unpersuasive.
complaint clearly establishes that plaintiffs had access to publicly available information pertaining to the realities of the legal job market. truths" nor misleading. standards.
Second, NYLS's statements are neither "half-
in the complaint, NYLS complied with the ABA
See Saunders v AOL Time Warner Cable, Inc., 2004 WL 5284146 (NY Sup Court,
allegedly misleading notice
Feb 9, 2004), affd 18 AD3d 216 (1st Dept 2005) (cable company's "[did] not rise to the level of fraud or misrepresentation
under the standard set for in 30 16 (b) ...
II In their Opposition Memorandum, plaintiffs try to reframe their pleadings and argue that the complaint in fact alleges that NYLS did not comply with the ABA regulations. However, the complaint is replete with allegations of compliance and utterly devoid of any allegations of non-compliance. See Amended Complaint, ~~ 26,33,34,44, 65,90-97. Indeed, plaintiffs' dissatisfaction with the ABA regulations themselves appears to be the admitted impetus for this lawsuit.
[because] FCC regulations were complied with and no false statements or intentionally claims as to the value of the converter box were made"). merely presented some basic information employment and salary information, Reliance Here, NYLS's
with respect to those of its graduates reporting their
With respect to reliance, defendant argues that the complaint is flawed because it is "wholly devoid of details concerning Memorandum [p Jlaintiffs' individual choices to attend NYLS."
in Support at 19. Namely, defendants argue that plaintiffs do not allege what
salary data they saw or read, when and where they saw or read it, and what impact the data had on their respective decisions to enroll at NYLS. fatal to plaintiffs' case. ld. Each plaintiff here has specified that he/she relied on NYLS's that approximately 90 percent ofNYLS graduates were The absence of these allegations, they claim, is
The court disagrees.
reported salary data and representations
employed within nine months of graduation, that these statements
were posted on NYLS's by third-party data
website, in NYLS's marketing materials, and in various publications clearinghouses,
and that these statements were made each year during the 2005-2009 period.
Amended Complaint, ~~ 17-25. That is, plaintiffs have sufficiently pleaded which representations they allege to be fraudulent, when those misrepresentations were made, where
they were made, and that they relied on these misrepresentations
in deciding to enroll and remain with respect to the
enrolled at NYLS. This is sufficient "to clearly inform the defendants
incidents complained of." Pludeman, supra, at 491; Knight Securities, 5 AD3d at 174
("[plaintiff] obviously knows what it represented at the time of the reclamation, prejudiced by the complaint's Plaintiffs' lack of specificity in that regard").
and it cannot be
pleading of reliance, however, is defective for a different reason.
must be reasonable.
See Arias v Women in Need, Inc., 274 AD2d 353, 354 (Ist Dept 2000); of
Miller v Doniger, 272 AD2d 73, 74 (lst Dept 2000). Even though "the reasonableness [plaintiffs'] reliance [generally] implicates factual issues whose resolution would be
inappropriate at this early stage" (Knight Securities, 5 AD3d at 173), reasonableness certain circumstances
be determined as a matter of law. See Colasacco v Robert E. Lawrence
Real Estate, 68 AD3d 706, 708 (2d Dept 2009) (the court dismissed the fraud cause of action because "plaintiffs' supposed reliance upon [the defendant's] alleged misrepresentations was
unreasonable as a matter of law" since "[t]here was no allegation in the complaint that the dimensions and boundary lines of the subject property were within the exclusive knowledge of the defendants" and "the plaintiffs could have ascertained these facts through the use of ordinary means"); Cohen v Cohen, 773 F Supp 2d 373, 385 (SONY 2011). "Reasonable reliance 'is a
condition which cannot be met where ... a party hal d] the means to discover the true nature of the transaction by the exercise of ordinary intelligence, and fail[ ed] to make use of those means." Afra v Zamir, 76 AD3d 56, 59 (1 st Dept 2010) (citing New York City School Constr. Auth. v Koreb-Diresta Constr. Co., 249 AD2d 205, 205-06 (1 st Dept 1998); Small, 252 AD2d 1, 8 misrepresentations will not be
(l st Dept 1998) affd 94 NY2d 43 ("Reliance on defendants'
presumed where plaintiffs had a reasonable opportunity to discover the facts about the transaction beforehand by using ordinary intelligence, or where a variety of factors could have
influenced a class member's
decision to purchase.");
Peach Parking Corp. v 356 W. 40th St.,
LLC, 42 AD3d 82, 87 (l st Dept 2007). Measuring reasonableness is done in the context of circumstances. Here, plaintiffs were They were making
among the select segment of students accepted into an American law school. a substantial economic commitment,
for which most of them would incur substantial debt, and employment prospects by
they had ample opportunity to discover their .realistic post graduation
consulting the many sources of information they cite in their complaint,
and cannot claim that it
was reasonable to confine their research and reliance solely on what amounts to just two sentences in NYLS's marketing materials. This is especially true with respect to their allegation
that they based their decision to remain enrolled at NYLS on that data, while at the same time being aware that the Great Recession already had halved the jobs available to them in the legal market. Amended Complaint, ~~ 50,60-62,64, Ex. 15. It is simply not plausible that NYLS's
data thus was the predicate on which plaintiffs relied to conclude they were guaranteed a job in the legal profession, commensurate with their education, within nine months of graduation. claim of ignorance is implausible
Small, 252 AD2d at 9 ("Plaintiffs'
in light of years of pre-1994 difficulty of quitting
press coverage of research on nicotine addiction, as well as the well-known smoking.").
Negligent Misrepresentation Claim
With respect to plaintiffs' claim for negligent misrepresentation
(JA.O Acquisition Corp.
v Stavitsky, 8 NY3d 144 ), as the court has already discussed, the documentary the complaint itself demonstrates
that plaintiffs cannot have reasonably relied upon the here, especially given the other information
statements alleged to be misrepresentation
available to them. See Co/asacco, 68 AD3d at 709 (the cause of action for negligent misrepresentation dismissed because, "as with the fraud cause of action, the complaint fails to under which the plaintiffs' reliance upon [the defendant's] alleged
allege circumstances misrepresentations
could be considered reasonable or justifiable"). Conclusion
In this court's view, the issues posed by this case exemplify the adage that not every ailment afflicting society may be redressed by a lawsuit. The action here is brought by nine plaintiffs, some of whom may be experiencing profession since America's abundance of opportunities the real aftershocks that have hit the legal Where before 2008 there was a seeming regardless of the
Great Recession of2008.
for lawyers at all points of entry into the profession,
law school one attended, law graduates today and over these past few years have been faced with the effects of the most severe contraction in demand for legal services that this court can recall since the early 1970s. Layoffs in law firms of all sizes abound. standstill. Hiring in many firms has come to a virtual
The days of mega firms hiring summer classes of 100 or more students to plan for
enough young lawyers to meet their needs for ever more billable hours have come to an abrupt end. Law firms are splitting up. Mandatory retirement ages are coming down. New billing arrangements are being demanded by increasingly cost conscious clients who now think long and hard before resorting to the courts to resolve their disputes. The court takes judicial notice, for
example, of an article on the front page of the New York Times Business Section of March 16, 2012 quoting representatives of a prominent legal consulting firm as saying, "Since it is unlikely,
based on overall economic conditions, that the demand for legal services will grow robustly for
the foreseeable future, the legal industry will be forced to live with uncertainty
for some time to
Now it is recent law graduates who are caught in the midst of an unanticipated They entered law school with the most optimistic of expectations squeeze.
and instead find themselves
without work and competing in a logjam of young lawyers, none of whom have any experience to offer employers who themselves must contend with clients that are insisting they will pay full they know can add real value to a representation. who previously may
freight only for seasoned professionals
While all this has happened, new, more chastened undergraduates,
have given nary a thought about whether they would end up with a paying job after withstanding the rigors of three years of legal training are now asking questions and looking to the law schools, among others, for greater transparency of responses as pertains to job-related they decide to commit to the law at all. But plaintiffs here are well beyond that. Essentially, as law graduates who made their decisions to go to law school before the full effects of the maelstrom hit, they now have turned their disappointment and angst on their law school for not adequately anticipating the possibility data before
of the supervening storm and presenting the most complete job-related have been compiled.
data that could possibly
They challenge the statistics that NYLS assembled each year to meet the
standards required by the American Bar Association, the official accrediting association designated by the U .. . Department of Education to provide students with the data they need to S
12To the court, these kinds of business cycles and their impact on professional schools is not new. One can recall in years past when the engineering profession and engineering schools enjoyed boom times, to be followed by years of unanticipated decline - only now to be enjoying a renaissance again. More recently, the same phenomenon has afflicted business schools and their much sought after MBA degrees, long viewed as the magic elixir for all that ailed undergraduates who were not quite sure what they wanted to do with themselves upon completing four years of college. Indeed, some would argue that in recent years the J.D. degree itself had taken on the attributes of the MBA for many oftoday's college grads that have wanted to continue their education but with no intention of practicing law. See Amended Complaint 134; Munneke, supra fn. 8.
make informed decisions before deciding to embark on the pursuit of a legal education. And they allege that these allegedly misleading statistics have adversely affected their ability to enter the practice of law as full-time members of our profession. For the reasons set forth in the court's decision and briefly summarized below, the court does not believe the grievances articulated by these plaintiffs in their complaint state a cause of action for which legal redress may be had. But in dismissing plaintiffs' complaint the court takes this opportunity to state that it has personally encountered many outstanding law graduates who have passed the bar and have been unable to find work in their chosen profession. They even have been willing to volunteer their time without compensation simply to gain experience and a credential for their resume, simply to 'stay sharp,' as they go about their search for paying jobs as practicing lawyers. There is no question that this dearth of opportunity is an unprecedented situation in the modem history of the practice of law and it simply cannot be ignored. If lawsuits such as this have done nothing else, they have served to focus the attention of
all constituents on this current problem facing the legal profession - from the law schools and
their regulators, to the compilers of data that rate the schools to assist law school consumers, to the law firms that formerly primed the pump for a steady supply-line of associate positions to be filled by each graduating class, to the judiciary who offer c1erkships to the best and the brightest, to the local bar associations whose members are responsible for the continuing health and viability of the profession, and, finally, to the prospective law students themselves. All must take a long, hard look at the current situation with the utmost seriousness of purpose. To the extent law schools are turning out too many graduates for the positions available, market forces will
begin to correct themselves, collective responsibility midst of the maelstrom.
hopefully in short order." But that does not itself excuse our
to those who have been unfortunate enough to have been caught in the To them we owe our best efforts to get them situated. data of the state of our
As for those who come after them we owe the most transparent
profession that we can possibly assemble so that they can make the most informed decisions that affect their livelihoods. The court takes judicial notice of a policy statement issued by US News
entitled Making Sense of Law Schools Jobs Data (March 13, 2012) which highlights that "far more detailed placement data will be collected on the 20 II J.~. graduating class .... [in] new,
more granular reporting" which will be incorporated in US News methodology
and law school
profiles. The fact is, however, that all data collection starts with the law schools themselves, and
it is this court's fervent hope that all the heat generated around this issue over this last year will
be replaced with a renewed sense of responsibility to prospective applicants and students, starting
at the law school level, and extending to the entire legal industry as we strive to address the concerns that have risen to the surface in this changed, challenging career environment. With these salutary thoughts firmly in mind, the court nevertheless plaintiffs' complaint here cannot survive defendant's has determined that
motion to dismiss because:
13Jndeed, the court takes judicial notice of another article on the front page of The New York Times Business Section, March 20, 2012, entitled For 2nd Year, A Sharp Drop In Law School Entrance Tests, reporting on a decline in the number of those taking law school entrance tests for the second consecutive year, i.e, 25 percent. "The decline reflects a spreading view that the legal market in the United States is in terrible shape and will have a hard time absorbing the roughly 45,000 students who are expected to graduate from law school in each of the next three years. And the problem may be deep and systemic .
[NJews that so many new lawyers are struggling with immense debt, is changing the way law school is perceived by undergrads. Word is getting through that law school is no longer a safe place to sit out an economic downturn - an article of faith for years - and that strong grades at an above-average school no longer guarantees a six-figure law firm job .
The idea that law school is an easy ticket to financial security is finally breaking
i) NYLS's statements in its marketing materials were not misleading
in a material way own
under GBL 349 to reasonable consumers acting reasonably, especially in light of plaintiffs' documentary evidence in the complaint (both their allegations and exhibits) which identifies sources of information regarding law school graduates' realistic employment
prospects - before,
during and after the 2008 Great Recession - readily available to plaintiffs and used by reasonable consumers of legal education to research and compare various law schools for the purpose of seriously considering whether to enroll in one; ii) plaintiffs could not have reasonably relied on NYLS's alleged misrepresentations, alleged in their fraud and negligent misrepresentation claims, because they had ample as
information from additional sources and thus the opportunity to discover the then-existing employment prospects at each stage of their legal education through the exercise of reasonable due diligence; and iii) plaintiffs theory of damages, that is, an award of the difference between what they paid for their law degree and an amount representing its ostensibly lesser intrinsic worth because the degree has not sufficed as an entrance ticket for the type of jobs plaintiffs hoped to obtain, is entirely too speculative and remote to be quantified as a remedy under the law. This is especially true here since there has been a supervening event, the 2008 Great Recession and its aftermath, which has wreaked havoc throughout the legal job market and upset the plans of most recent law graduates wherever they have attended law school.
it is complaint is dismissed.
ORDERED that plaintiffs' Dated: March
02 ( ,2012
MELVIN l. SCHWEITZ
Affidavit of Michael Burns
IN THE CIRCUIT COURT OF COOK COUNTY, ILLINOIS COUNTY DEPARTMENT, CHANCERY DIVISION JONATHAN PHILLIPS, BRIAN LOKER, ADAM SMESTED, XAVIER HAILEY, BRENT DAVIDSON, SHELL YE TA YLOR, ALISON LEARY, JAIME WALSH and MADISON MULLADY, Plaintiffs, Case No. 12-CH-03S23
DEPAUL UNIVERSITY, a/kla DEPAUL UNIVERSITY COLLEGE OF LAW, and DOES 1-20, Defendants.
I serve as the Dean for Enrollment Management and the Director of Law Admissions at DePaul University College of Law. I have held this position for approximately eight years. In that capacity, I oversee all operations in connection with incoming law student admissions and enrollment. I have personal knowledge of and am competent to testify as
to all matters set forth in this Affidavit. 2. Each year, the Office of Admissions publishes a student Profile concerning certain characteristics of the incoming and prior year's graduating class based on information provided by the Law Career Services Office. Among other things, the Profile reports employment and salary statistics related to the prior year's graduating law school class. In each year, the Profile discloses a range of salaries reported and discloses the reported average starting salary in private practice and in business.
A true and correct copy of the Profile for the class of 2007, which was published in 2008, is attached as Exhibit 1.
A true and correct copy of the Profile for the class of 2009, which was published in 2010, is attached as Exhibit 2.
Further affiant sayeth not.
Subscribed and sworn to before me thi~h day of May, 2012.
NOTARY PUBLIC STATE OF ILUNOIS MY COMMISSION EXPIHES ClEP 12.2012
EXHIBIT B: Exhibit 1
2007 Student Profile
I DEPAUL UNIVERSITY
COLLEGE OF LAW
Total Enrollment J,D, Students" ' Full-Time,,, ,,' Part-Time Total University Enrollment, Fall 2008 Entering Class Statistics Total Applications '" Full-Time Enrollment ,,,"" Part-Time EnrolimenL"",,, Median LSAT (Full-Time) , LSAT 25th and 75th Percentiles, for Fall 2008 ",," " 1,022 ",,,,,746 ",,276 23,401 • • • • • • • • • • •
25 East Jackson Boulevard Chicago, Illinois 60604 800-428-7453 or 312-362-6831 www.law.depaul.edu
2008-2009 Admission Profile
DePaul University College of Law and its alumni have been a prominent and integral part of the Chicago legal community for almost a century, Our graduates are unparalleled with respect to the positions of leadership they hold throughout the nation in law firms, corporations, government and on the bench. The Law School is located in the heart of Chicago, one of the nation's largest legal and business communities, Areas of Specialization ( * indicates certificate program)
Child & Family Law' Corporate & Commercial Business Transactions Criminal Law' Health Law' Intellectual Property Law'
(General, Patents, Arts & Museum, Information Technology)
,5,168 "" 232 ' 137 161
International & Comparative Law' Litigation & Practice Skills Labor & Employment Law Public Interest Law' Real Estate Law Taxation'
Median Undergraduate GPA (Full-Time) ,," ' 3.40 GPA 25th and 75th Percentiles, ",,3,04 - 3,62 Full-Time Full-Time Part-Time Part-Time Age Range""", Mean Age"" Age Range", Mean Age "",, ",20 - 46 """,,,,,24 ""'''''''' 21 - 59 " 26 , ",,,,,,,,,,,21% " 51% """",,53%
Legal Clinics • Asylumllmmigration • Civil Rights Law • Criminal Appeals • Death Penalty • Family Law • Misdemeanor • Special Education • Technologyllntellectual
Minority Students... Female Students "" Out-of-State Enrollment Tuition & Financial Full-Time Program" Part-Time Program" Aid
" $35,400 "',' $23,000
Scholarships range from partial to full-tuition awards, Merit-based scholarships are awarded at the time of acceptance and no separate application is required, Students must complete the Free Application for Student Aid (FAFSA) to be considered for need-based aid, Faculty Full-Time Faculty Adjunct Faculty,
Research Centers & Institutes • Asian Legal Studies Institute • Center for Animal Law • Center for Art, Museum, & Cultural Heritage Law • Center for Dispute Resolution • Center for Intellectual Property Law & Information Technology (CIPLlT®) • Center for Jewish Law & Judaic Studies • Center for Justice in Capital Cases • Center for Law & Science • Center for Public Interest Law • Health Law Institute • International Aviation Law Institute • Intemational Human Rights Law Institute • International Weapons Control Center • Schiller, DuCanto & Fleck Family Law Center Joint Degree Programs • • • • J,D.lMaster of BUSiness Administration J,D.lMaster of Arts In International Studies JD.lMaster of SCience in Public Service Management JD IMA & J D.lM S In Computer SCience
2008-2009 Admission Profile
Employment & Career Services Information In 2007, 95.1 % of the graduating class reported employment within nine months of graduation. While most DePaul graduates choose to stay in Illinois, specifically in Chicago, many choose to practice in other states. Popular employment locations for DePaul graduates include California, Colorado, Florida, Indiana, Michigan, New York, Texas, Virginia, Washington, DC, and Wisconsin Employment Categories
Private Practice .. Business ... Government.. . Public Interest . Judicial Clerkships . Academia .. Unknown ... 62% .................... 19% ..... 12% 4% 1% 2% 0%
Advocates Amnesty International Asian Pacific American Law Student Association Black Law Student Association Business Law Society Law & Science Society Christian Legal Society Decalogue SOCiety DePaul Journal of Social Justice Environmental Law Society Evening Law Students Society Family Law Society Federalist Society for Law and Public Policy Studies International Law Society Intellectual Property Law Society Justinian Society of Lawyers Latino Law Student Association Law Review Law Students for Reproductive Justice Moot Court Society Muslim Law Student Association National Lawyer's Guild Outlaws-Bi, Gay and Lesbian Law Student Association Phi Alpha Delta Phi Delta Phi Public Interest Law Association Society for Asylum & Immigration Student Bar Association Women's Law Caucus Women's Bar Association of Illinois
Average Starting Salary in Private Practice .. $82,890 Average Starting Salary in Business... . $73,637 Total Starting Salary Range.. .. $27,000-250,000
Career Services Programs
• • • • • • • • • • • Firm, corporation, government and not-for-profit current job listings Job fairs Employer database Job search, resume writing, interviewing skills, professional development and other toolbox workshops Judicial Clerkship Program Monthly "Lunch and Dinner with a Lawyer" series Mock interviews Noon-time attorney panels Fall & Spring Employer Recruitment Programs Employer receptions and meet & greets Annual Student Alumni Career Conference
Business & Commercial Law Journal Health Care Law Journal Journal for Art, Technology & Intellectual Property Law Journal for Social Justice Law Review Journal of Sports Law & Contemporary Problems Women's Law Digest
• • • • Total Volumes - 397,732 (including microfiche) Librarians - 7; Support Staff - 12 Seating Capacity - 44 7 seats 8 Group Study & 5 Media Viewing Rooms
Electronic & Online Resources
Wireless connectivity throughout the Law School 4th, 5th, and 6th Floor-Law Library (I-Share, CALI, GPO Access, Westlaw, LexisNexis, Hein Online, BNA, etc.)
Floor Lewis Center (Microsoft Word, Internet, E-mail)
EXHIBIT B: Exhibit 2
2009 Student Profile
I DEPAUL UNIVERSITY
COLLEGE OF LAW
Total Enrollment for Fall 2010
J.D. Students .... Full-Time ... Part-Time .. Total University Enrollment. ... 1,056 ....853 .203 ......25,072 • • • • • • • •
25 East Jackson Boulevard Chicago, Illinois 60604 800-428-7453 or 312-362-6831 lawtnfo@depauJ.edu www.law.depauJ.edu
2010-2011 Admission Profile
DePaul University College of Law and its alumni have been a prominent and integral pari of the Chicago legal community for almost a century. Our graduates are unparalleled with respect to the positions of leadership they hold throughout the nation in law firms, corporations, government and on the bench. The College of Law is located in the tieett of Chicago, one of the nation's largest legal and business communities. Health Law' Intellectual Property Law'
(General, Patents, Arts & Museum, Information Technology)
Fall 2010 Entering Juris Doctor Class
Total Applications.. Full-Time Enrollment Part-Time Enrollment Median LSAT . LSAT 25th and 75th Percentiles ..... Median Undergraduate GPA . GPA 25th and 75th Percentiles .... Full-Time Age Range Full-Time Median Age ...... Part-Time Age Range Part-Time Median Age .. Minority Students. '" Female Students .. . Out-of-State Enrollment (full-time) .... . 5,804 256 ... 55 ..160 ..156 -161 ...3.48 ..3.13 - 3.64 .21 - 44 ....23 ...21 - 34 .....23 23% ..43% ...56%
International & Comparative Law' Civil Litigation Labor & Employment Law Public Interest Law' Real Estate Law Taxation'
• • • • • • • • • • Advanced Immigrant Detainee Asylumllmmigration Civil Rights Law Criminal Appeals Death Penalty Family Law Misdemeanor Poverty Law Special Education Advocacy Technology/Intellectual Property
Research Centers & Institutes
• • • • • • • • • • • • • • • Asian Legal Studies Institute Center for Animal Law Center for Art, Museum, & Cultural Heritage Law Center for Church State Studies Center for Dispute Resolution Center for Intellectual Property Law & Information Technology (CIPLlT®) Center for Jewish Law & Judaic Studies Center for Justice in Capital Cases Center for Law & Science Center for Public Interest Law Health Law Institute International Aviation Law Institute International Human Rights Law Institute International Weapons Control Center Schiller, DuCanto & Fleck Family Law Center
Tuition & Financial Aid
Full-Time Program. Part-Time Program .. ..$38,900 ...... $25,280
Merit-based scholarships are awarded at the time of acceptance and no separate application is required. Students must complete the Free Application for Student Aid (FAFSA) to be considered for need-based aid.
Full-Time Faculty .... Adjunct Faculty .. .60 ...105
Joint Degree Programs
• • • • J D.!Master of Business Administration J.D.!Master of Arts in International Studies J.D.!Master of Science In Public Services Management J.D.!MA & J.D.!M.S. in Computer Science
Areas of Specialization ( • indicates
• • • Business Law' Child & Family Law' Criminal Law'
2010-2011 Admission Profile
Employment & Career Services Information
In 2009, 92.8% of the graduating class reported employment Within rune months of graduation. While most DePaul graduates choose to stay in Illinois, specifically in Chicago, many choose to practice m other states. Popular employment locations for 2009 DePaul graduates include California, Indiana, Michigan, New Mexico, North Carolina, Texas, Washington, DC, and Virginia.
Advocates American Constitution Society Appellate Team of the Moot Court Society Art & Cultural Heritage Legal Society Asian Pacific American Law Student Association Black Law Student Association Business & Corporate Law Society Christian Legal Society Decalogue Society Environmental Law Society Evening Law Students Society Family Law Society Federalist Society for Law and Public Policy Studies Health Law Society Hellenic Law Society International Law Society Intellectual Property Law Society Justinian Society of Lawyers Latino Law Student Association Law Review Law Students for Reproductive Justice Moot Court Society National Lawyers Guild Outlaws-Bi, Gay and Lesbian Law Student Association Phi Alpha Delta Phi Delta Phi Public Interest Law Association Society for Asylum & Immigration Student Bar Association Women's Law Caucus Women's Bar Association of Illinois
Private Practice ..... Business .... Government ... Public lnterest.; Judicial Clerks hips Academia Unknown . . ..50% 26.1% 12.1%
Average Starting Salary in Private Practice ... $97,056 Average Starting Salary in Business.. . .. $74,267 Total Starting Salary Range $25,000-190,000
Bar Passage Rate
DePaul First-time Test Takers ................ 92%
Career Services Programs
• • • • • • • • • • Firm, corporation, listings Job fairs Employer database resume writing, interviewing skills, professional and other toolbox workshops Program and Dinner with a Lawyer" panels Program and meet & greets series Job search, development Judicial Monthly Noon-time Employer government and not-for-profit current job
Business & Commercial Law Joumal Health Care Law Journal Journal for Art, Technology & Intellectual Property Journal for Social Justice Journal of Sports Law & Contemporary Problems Journal of Women, Gender & the Law Law Review Rule of Law Journal Women's Law Digest Law
Mock interviews attorney receptions Fall Employer Recruitment
• • • • Total Volumes Librarians Seating - 402,000 (including Staff - 12 Rooms microfiche) - 7; Support
- 455 seats
12 Group Study & Media Viewing
Electronic & Online Resources
Wireless connectivity throughout the Law School . 4~ , 5~ ,an d 6 ~F loor-Law Library (I-Share, CALI, GPO Access, Westlaw, LexisNexis, Hein Online, Word, BNA, etc.) E-mail) 14~ Floor Lewis Center (Microsoft Internet,