The Lookout

Law grads sue school, say degree is ‘indentured servitude’

Liz Goodwin
The Lookout

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Three recent law school graduates are suing their alma mater in a $200 million class action, alleging they were deliberately misled about their future career prospects.

New York Law School "consigns the overwhelming majority of [students] to years of indentured servitude, saddling them with tens of thousands of dollars in crushing, non-dischargeable debt that will take literally decades to pay off," the suit charges.

The plaintiffs say they were told the employment rate for NYLS alumni 9 months after graduation was between 90 and 95 percent. They say they had no idea that figure included people who were employed in jobs that don't require a law degree, or even a college degree. The percentage of recent graduates who are in jobs that require or prefer a J.D. may even be below 50 percent, they allege.

Two of the plaintiffs are practicing attorneys, while one graduated in 2010 and still hasn't been able to find permanent work. Plaintiff Alexandra Gomez-Jimenez, an immigration attorney, says she couldn't find permanent legal employment until April 2008, nearly a year after her graduation.

"These claims are without merit and we will vigorously defend against them in court," NYLS Dean Richard A. Matasar said in a statement.

NYLS students graduate with $119,437 in loans on average, and it is one of the most expensive law schools in the country even though it is rated in the bottom half of U.S. News' rankings. The plaintiffs' lawyer, David Anziska says he is filing this suit, and another against Thomas M. Cooley Law School in Michigan, because he wants schools to be more transparent with their students about the tough market out there for young attorneys. (Cooley filed a countersuit alleging Anziska's firm defamed the school.)

"If you look at who is in charge of regulating law schools, it's all law school deans," Anziska told The Lookout. "It's like having the fox guard the henhouse."

The American Bar Association accredits the nation's 200 law schools. Facing mounting criticism, the ABA decided in May to require that law schools tell students how many graduates are in jobs that require a law degree, not just how many of them are employed at all. The new rule won't go into effect for at least another year.

According to the New York Times, law grads need to make at least $65,000 a year in order to keep up with their debt (which is non-dischargeable in bankruptcy). The law school industry has grown rapidly, even as the recession took a big bite out of the number of jobs at corporate law firms. Nine new law schools opened in the last 10 years, and the number of law degrees given out increased by 11 percent over the same period.

As we reported earlier, only 68.4 percent of the legal class of 2010 are in jobs that require them to pass the bar exam, the lowest share since the Association for Legal Professionals began collecting data. Another 10.7 percent of the class of 2010 are in jobs that require or prefer a J.D., while 8.6 percent have jobs that require neither a law degree nor bar passage. (The class' overall employment rate--for jobs in and out of the legal profession--is lower than it's been for any class since 1996, at 87.6 percent. So counting unemployed new graduates, the actual percentage of those in jobs that require bar passage is even lower, at 60 percent.)

These two suits are not without precedent. In May, the for-profit San Francisco's California Culinary Institute payed out $40 million in tuition reimbursements when they settled a class action filed by graduates who said they were told the school boasted a 98 percent job placement rate. That data included people employed as line chefs or as baristas at Starbucks, The San Francisco Chronicle reported. Also that month, an out-of-work 2008 graduate of Thomas Jefferson School of Law sued, saying the school misrepresented its employment data.

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