Wednesday, March 13, 2019

CollegeNET and the Common App agree to settlement

By:  Nancy Griesemer


After nearly five years and millions in legal fees, the lawsuit pitting the Common Application against CollegeNET has finally come to an end.
In a barebones announcement, the parties indicated they reached settlement in a suit charging that the Common Application had suppressed competition in the college application industry through a series of unfair practices. Common App has consistently denied the charges and vigorously defended itself against the accusations.
A joint statement from the two organizations read in its entirety, “The Common Application and CollegeNET have agreed to resolve and dismiss the lawsuit brought by CollegeNET in May 2014. The matter has been resolved in a way satisfactory to the Parties pursuant to a confidential settlement agreement whereby, without admitting liability, Common Application has agreed commencing with the 2019-2020 application season to modify certain of its challenged practices."
Without providing much in the way of detail, the statement suggests that the Common Application, though not admitting liability, has agreed to modify one or more practices starting with the 2019-20 application cycle. These presumably are practices CollegeNET claimed were “anticompetitive and monopolistic.”
The Chronicle reports that as a result of the settlement, the terms of the Common App’s membership agreement for participating colleges “apparently will soon change” in ways that have yet to be announced.
CollegeNET launched litigation in 2014, alleging that the Common App dominated the college application market by forcing schools to either conform to its membership restrictions or lose potential applicants and associated revenue. A year later, the suit was denied, but in October 2017, a Ninth Circuit panel reversed the ruling. The Common App then took the matter to the U.S. Supreme Court, which declined to take up the petition. A new motion to dismiss was filed last July, which was denied in December.
In other words, the Common App and CollegeNET were headed toward protracted litigation, bound to cost both parties a considerable amount of money beyond what had already been spent.
In an email sent to Common App members, Jenny Rickard, president and chief executive officer, complained, “Our non-profit membership association has spent several million dollars defending itself against these frivolous claims” and went on to suggest that she would prefer these legal fees go toward expanding the Common App’s “outreach and access programs.”
The Common App’s lawyers agreed and argued that if litigation were to continue, member colleges could find themselves entangled in “substantial discovery burdens.”  And if pursued, the lawsuit could “disrupt the college-application process for hundreds of colleges and millions of students.”
In a written statement responding to the settlement, Rickard said the organization was happy to bring “an appropriate and responsible conclusion to the litigation. By agreeing to the settlement, “we are able to avoid the inconvenience, expense, and burden that would have been born by all parties, especially colleges and counselors.”
For his part, Jim Wolfston, CollegeNET’s founder and chief executive said, “I appreciate the fact that Common Application officials were thoughtful, open, and willing to work through the practices challenged in the lawsuit.”
As it progressed through the courts, the lawsuit posed additional problems for the college application industry. Not long after CollegeNET sued the Common App, it entered into an agreement to build and operate an application platform for the Coalition for College (formerly Coalition for Access, Affordability, and Success), which is the Common App’s biggest competitor, among others. Institutions with membership in both organizations were uncomfortable with the increasingly bitter disagreement and worried about how money that could be spent on innovation was going to lawyers instead.
But that’s all in the rearview mirror. Both parties are now free to focus their energies in more constructive areas like how to make the increasingly complex process of applying to college easier and less threatening to the average high school student.

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