Graduate Students

Justice Dept. Argues Against Dismissal of Lawsuit Challenging Kaplan U.

May 30, 2008

The three former employees who have accused Kaplan University in federal court of obtaining federal student-aid funds under false pretenses received a boost from the U.S. government on Thursday. It came in the form of a court filing by the U.S. Department of Justice, opposing Kaplan’s attempt to have the False Claims Act lawsuit against it dismissed.

Although the federal government has declined to intervene in the case, the Justice Department said in its filing that Kaplan’s legal arguments for dismissing the case were off point.

Further, the Justice Department maintained, the “parade of horribles” that Kaplan predicted if the case were not dismissed was “entirely illusory.” The government is entitled to a portion of the proceeds if the employees prevail against the company.

The department’s involvement in the case echoes the stance it took in 2005, after a False Claims Act lawsuit against the for-profit University of Phoenix was initially dismissed. That case was later reinstated by a higher court and is slated for trial next year.

Kaplan University has denied any wrongdoing. The institution is an arm of Kaplan Inc., a wholly owned subsidiary of the Washington Post Company. —Goldie Blumenstyk