The Indiana Court of Appeals upheld a judge’s denial of motions by a judge to dismiss three class action lawsuits, two against Purdue and one against Indiana University, alleging that the universities “broke contractual promises for in-person tuition” and were “unjustified by withholding.” been enriched”. Tuition, tuition and room and board fees.
IU student Justin Spiegel and Purdue student Elijah Seslar filed two class action lawsuits against the universities, alleging breach of contract for in-person tuition, services and activities and seeking prorated tuition and tuition refunds in damages. Three other students, Zachary Church, Jordan Kleberow and Luke McNally, referred to as “the Church plaintiffs,” made claims similar to the first two lawsuits, but added unjust enrichment claims relating to room and board fees in exchange for room and board in addition, a proportionate reimbursement of these costs.
A judge accepted Purdue’s motion to dismiss the Church plaintiffs’ breach of contract claim relating to program-specific fees, according to Indiana appeals court documents, but denied dismissing most of the other claims and consolidated the allegations in the two suits. Motions to dismiss the first two lawsuits were denied.
The Indiana Court of Appeals upheld those denials Thursday.
Tuition and Tuition Fees
The Court of Appeals finds that the universities and the plaintiffs had tacit contracts for tuition, services, and activities in exchange for tuition and fees, and express contracts for room and board in exchange for room and board fees. Universities have not disputed the existence of those contracts, court documents say, and they have violated that agreement when teaching went online and campus facilities, including dormitories and dining halls, were partially or fully closed.
The universities claimed that Gov. Eric Holcomb’s orders made it impossible for them to fulfill their side of the contracts, but “assessing the feasibility of this affirmative defense is premature at this stage of the proceedings,” court documents said.
In assessing the harm, the plaintiffs noted that the universities’ online degree programs offer degrees similar to in-person classes for “substantially less than” the in-person classes, court documents said. A Purdue degree in accounting or business administration costs about $50,000 less for international students in an online program, and an IU computer science degree costs more than $13,000 less for online students.
“Based on the foregoing, we affirm the denial of IU’s motion for judgment on the Spiegel briefs and the denial of Purdue’s motion to settle the claims of plaintiffs from Sessler and the Church for breach of contract and unjust enrichment relating to the payment of Tuition fees to be dismissed and tuition fees,” the documents said.
Church plaintiffs allege that Purdue breached the contract by not providing room or board for the remainder of the spring 2020 semester. Purdue claims that “some campus housing would remain open for students who must remain on campus,” and “on-campus dining will continue.”
However, plaintiffs argue that “only students with extenuating circumstances will be allowed to remain in on-campus housing” and that on-campus dining would “continue on a very limited basis.”
The court found that it is “for an examination of the facts” to determine whether those students had extenuating circumstances and whether “very limited” dining options constituted a breach of contract, but that the plaintiffs assert sufficient claims of breach of contract.
“Therefore, we confirm the denial of Purdue’s motion to dismiss these claims.”
Holcomb signed a bill into law in April 2021 that says a class action lawsuit against a university for damages due to COVID-19 cannot be brought in a contract of any form. The law was signed after both universities rejected motions to dismiss and had already filed motions with the Court of Appeals.
Both universities asked the Court of Appeals to review this law, but the court refused on the grounds that a party in an appeal cannot be the first to raise an issue.