Antitrust Order Restricts Intercollegiate Actions


MIT employees are reminded that they are subject to a federal court order which restricts intercollegiate actions.

The order, initially published in MIT Tech Talk September 3, was a result of the ruling by District Court Judge Louis Bechtle of Philadelphia that the scholarship practices of MIT and the Ivy League were commercial in nature and violated federal antitrust laws.

MIT is appealing the case. The formal notice to appeal will be filed soon, the appelate brief itself will be filed in January, and the case is expected to be heard sometime in the spring in Philadelphia by a panel of three judges of the Third Circuit Court of Appeals.

Vice President Constantine B. Simonides, in a memo to the Academic Council, the Faculty Council and the Administrative Council, said that while the appeal is pending, the order remains in effect.

"Therefore, it is important that we all understand and comply with the order. Within MIT, each senior officer is responsible for informing the staff in his or her areas of the contents of the Judge's order and for assuring that we respect its terms...

"Paraphrased, it prohibits any person affiliated with MIT from participating in any intercollegiate arrangement which may have the tendency to affect the determination of the price to be paid by a prospective student, including any adjustments of the price...

"It is not clear the extent to which Judge Bechtle intended his order to apply beyond intercollegiate agreements on financial aid and exchanges of budgetary information," he said. If employees have any question whether any of their interactions with other institutions might violate this order, they are urged to check with their senior officer before participating.

The judge's order of September 2 exempts activities authorized in the 1992 Higher Education Reauthorization Act (Section 1544 of Public Law No. 102-325, 106 Stat. 448), which allows colleges to agree among themselves to award non-federal aid only on the basis of financial need and voluntarily to adopt "defined principles of professional judgment for determining student financial aid."

The 1992 law doesn't allow colleges to "discuss or agree with each other on the prospective financial aid award to a specific common applicant for financial aid."

The full text of Judge Bechtle's order is as follows:

"And now, to wit, this Second day of September, 1992, IT IS ORDERED that judgment is entered in favor of the United States and against Massachusetts Institute of Technology.

"Except for the provision of S 1544 of Public L. No. 102-325, 106 Stat. 448, Massachusetts Institute of Technology and its agents, employees, and representatives, are enjoined from entering into, being a party to, maintaining or participating in-directly or indirectly, on a case-by-case basis or otherwise-any combination or conspiracy which has the effect, or the tendency to affect, the determination of the price, or any adjustment thereof, expected to be paid by, or on behalf of, a prospective student, whether identified as tuition, family contribution, financial-aid awards, or some other component of the cost of providing the student's education by the institutions to which the student has been admitted."

A version of this
article appeared in the
October 21, 1992

issue of MIT Tech Talk (Volume
37, Number
10).


Topics: History of MIT, National relations and service

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