The California Attorney General brought claims against for-profit online college Ashford University and its parent company for violating the state’s unfair competition and false advertising laws by making false and misleading statements to prospective students. The trial court agreed with the AG, and imposed over $22 miillion in civil penalties.
Yesterday, an intermediate appellate court largely affirmed, reducing the penalties awarded by approximately $900,000, but otherwise upholding the lower court’s judgment. In so doing, the court went through, in detail, Ashford’s targeting of nontraditional students, its “boiler room” admissions department, and misrepresentations made by admissions counselors about nine different topics. Of note, the court took Ashford’s lawyers to task for a “slanted and unduly argumentative” brief that “violate[d] several principles the content of appellate briefs,” before rejecting its extraterritoriality argument and its arguments that the penalty was not sufficiently related to victims’ harm, citing testimony of a number of students who had felt they had been taken advantage of. The Attorney General’s press release is available here.
