A class-action lawsuit filed against the company that once owned Grand Canyon University in Arizona alleges grads were the victims of a “deceitful racketeering scheme” that left them owing thousands of dollars more than they were told.
Grand Canyon Education, a publicly traded company that once owned the Christian university, is tied to the school through an agreement in which the nonprofit university pays the for-profit company a percentage of its revenue in exchange for services, the suit charges.
The case echoes some of the allegations the Department of Education made against Grand Canyon University last year, when it leveled a record $37.7 million fine against the university.
Grand Canyon has countered the Biden administration is targeting the Christian school because of “ideological” differences.
“We need to hold Grand Canyon accountable for the lies they told Ph.D. candidates about the real cost of their education at GCU,” Adam Levitt, a lawyer representing the students, told Arizona Family.
“Choosing to pursue a doctoral degree is one of the most expensive and life-shaping decisions many people make, and they deserve to know the true cost that they’re committing to.
“We filed this class-action lawsuit to ensure Grand Canyon stops these deceptive practices and other for-profit colleges don’t even try them.”
In the case filed Wednesday, lawyers from the National Student Legal Defense Network and Levitt’s law firm are seeking relief for some 7,000 class members, Market Watch reported.
They accuse the company of violating the Racketeer Influenced and Corrupt Organizations Act, or RICO — a law initially designed to target organized crime — in its pitch to lure students.
“Any time an educational institution views its students as revenue units rather than students, all sorts of mischief occurs,” Levitt told Market Watch. “That’s exactly what happened here.”
“The allegations in the lawsuit are completely without merit, rely on misleadingly cropped documents…and are focused on practices that are prevalent in higher education,” Bob Romantic, the spokesman for GCU, told Newsmax Thursday.
“GCU’s descriptions of its doctoral programs on its website and its disclosure documents are no different than those at countless other universities with dissertation-based doctoral programs.”
Romantic said “all doctoral students during the time in question were required to sign numerous documents that included information about the likelihood of continuation courses.” He also said the suit “misleadingly presents screenshots of GCU’s Degree Program Calculator that crop out the language …that clearly and conspicuously discloses that doctoral graduates, on average, require several continuation courses and provides the cost of those courses.”
“We believe this class action lawsuit will be summarily dismissed and is part of a continued and coordinated effort to expand on the Department of Education’s false accusations and unwarranted actions designed to bring harm to the university,” he added.
“Secretary of Education Miguel Cardona acknowledged as much when he recently told the House Judiciary Committee it was his goal to ‘shut down’ GCU.”
The Federal Trade Commission also alleged GCU advertised itself as a nonprofit despite the school being operated and dependent on Grand Canyon Education, a for-profit operation with investors.
Romantic also has denied the FTC allegation, Arizona Family reported.
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