Monday, July 30, 2012

Law school fraud cases will go to discovery

Arring v. Golden Gate Univ., No. CGC-12-517837 & Halloc v. Univ. of San Francisco, No. CGC-12-517861 (Cal. Super. Ct. July 19, 2012)
These two cases involve the same reasoning, so I won’t distinguish them.  The defendants demurred to plaintiffs’ complaints about allegedly fraudulent claims made about the defendants’ law schools/plaintiffs’ chances of securing remunerative employment if they attended defendants’ law schools. 
First, defendants argued that their statements weren’t likely to deceive reasonable law students.  The court noted that, ordinarily, whether a statement is likely to deceive reasonable consumers is a question of fact under California law.  Relying on the similar New York case, defendants argued that no reasonable person could have thought their statistics included only jobs requiring or favoring a law degree.  The plaintiffs, however, alleged that they were in fact deceived, and the court had no reason to think that they weren’t reasonable consumers of a law school education.  Further, the alleged statements were made in a context—attracting people to law school—where a reasonable prospective/current student could believe that the statements didn’t include jobs for which a law degree was irrelevant or minimally useful.  Further factual development was required.
Second, defendants argued that a law school education wasn’t within the definition of “services” under the relevant California consumer protection law.The court again disagreed.  “Services” is very broad, even though it doesn’t include insurance; the cases about insurance were inapposite because the legislative history with respect to insurance differs and because education is like many other services to which the relevant laws have routinely been applied.

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