Judge pulls plug on ex-students' class action vs DeVry over graduate job placement claims

By Scott Holland | Feb 15, 2019

CHICAGO — A federal judge has again dismissed a class action that former DeVry University students brought against the school, claiming they were misled by ads for the school which, they said, promised them jobs related to their degrees after they graduated.

The October 2016 lawsuit from named plaintiffs Debbie Petrizzo of New York; Renee H. Polly and Brandy Van Buren, both of Missouri; Melissa Lotzman of Colorado; Jamison Purry of Oregon; and Cheryl Costello of Kansas alleged DeVry violated consumer protection laws in Illinois and five other states.

The graduates said they were attracted to DeVry by the school’s claim that, since 1975, about 90 percent of graduates land “careers in their field within six months of graduation,” but noted none of them was able to secure employment within that period.

In an opinion issued Feb. 13, Judge Manish Shah — who earlier dismissed the initial version of complaint — noted that as the result of a settlement with the Federal Trade Commission, DeVry had to stop using the 90 percent figure in advertising campaigns as of December 2016, and the following April the school lowered tuition for Tech Path associates and bachelor’s degree programs from $609 per credit hour to $487.

However, Shah said he doesn’t agree with the plaintiffs' position that the tuition decrease reflects the true value of the education they’d already completed.

“That number would require further factual development to address things like DeVry’s points about economic factors and the passage of time and probably expert testimony, too,” Shah wrote. “Plaintiffs cannot rely on a price-inflation theory to prove actual damages in consumer fraud claims. Instead, they must prove that the misrepresentations caused each individual plaintiff to pay more.”

He further said, while the plaintiffs might have a path to showing they were damaged, the complaint fails to adequately allege fraud. He agreed with DeVry’s position the graduates weren't specific enough about which marketing materials they saw, and where they saw them. Plaintiffs reported encountering different percentages in various settings and didn’t acknowledge any “asterisks, footnotes or other explanation,” undercutting uniformity requirements.

“If there were only one DeVry ad or all DeVry ads had exactly the same 90 percent representation, then perhaps what plaintiffs have alleged would be sufficient,” Shah wrote. “DeVry would know the wording of the representation made to plaintiffs along with the asterisks and explanations that came with it. But the complaint shows that the representations varied.”

Shah also said the plaintiffs didn’t adequately show how DeVry’s statements were false, but instead relied “on information and belief,” a path only available to plaintiffs for whom the underlying facts are inaccessible, or if the plaintiff provides grounds for suspicions.

“The grounds for plaintiffs’ suspicions come entirely from others’ lawsuits against DeVry,

 Shah wrote. "Untested allegations made by the FTC, Department of Education, and attorneys general of Massachusetts and New York and confidential witness statements made in a DeVry securities class action."

Shah said the failure of the fraud claims similarly undercuts unjust enrichment allegations. He also denied the plaintiffs a chance to amend the complaint a second time, because they didn’t correct the deficiencies he identified in the initial filing. DeVry’s motion to strike class allegations was terminated as moot.

Plaintiffs have been represented by attorneys with the firms of Wolf, Haldenstein, Adler, Freeman & Herz, of New York and Chicago, and Gainey McKenna & Egleston, of New York and Paramus, N.J.

DeVry has been defended by the firms of Steptoe & Johnson LLC, of Chicago, and Polsinelli P.C., of Chicago.

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Organizations in this Story

Adtalem Global Devry Devry Unversity Gainey McKenna & Egelston Polsinelli Steptoe & Johnson PLLC U.S. District Court for the Northern District of Illinois Wolf Haldenstein Adler Freeman & Herz

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