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Elite Universities Under Scrutiny: Allegations of Wealth-Based Admissions Preferences Emerge in Landmark Lawsuit
Edited by: Fern Sidman
Allegations of preferential treatment for wealthy students in the admissions processes of some of the United States’ most prestigious universities have resurfaced in a long-running lawsuit. According to a recently published report in The New York Times, newly revealed documents suggest that elite institutions, including Georgetown University, the University of Pennsylvania, and the Massachusetts Institute of Technology (MIT), have prioritized applicants based on their family wealth and potential for donations, contradicting their supposed “need-blind” admissions policies.
This lawsuit challenges the fairness and legality of admissions practices at 17 prominent universities, including Notre Dame, Cornell, Johns Hopkins, and Caltech, raising fundamental questions about the integrity of college admissions in the U.S.’
At the heart of the revelations is Georgetown University, where longtime president John J. DeGioia allegedly maintained a “President’s List”—a roster of approximately 80 students who were flagged for preferential consideration in the admissions process.
As reported by The New York Times, these students were not chosen for their academic excellence or athletic achievements, but rather for their familial wealth and potential to contribute large donations to the university.
According to the lawsuit, being on the President’s List virtually guaranteed admission, regardless of the students’ academic or extracurricular qualifications. The report in The New York Times indicated that the motion argues that such practices violate the spirit of “need-blind” admissions, which are supposed to ensure that applicants are evaluated solely on merit, without consideration of their family’s financial resources.
The plaintiffs claim that these universities violated provisions of a now-expired antitrust exemption law, which permitted them to collaborate on financial aid formulas—but only under the condition that admissions decisions remained free from financial influence.
Defendants, including Georgetown, argue that merely considering wealth does not violate the law, asserting instead that the law prevents discrimination against poorer students in need of financial aid—not necessarily against favoring wealthy ones, The New York Times report said. This interpretation is at the center of the legal battle.
The lawsuit also sheds light on admissions practices at the Massachusetts Institute of Technology (MIT), a university renowned for its strict academic standards and elite reputation.
According to documents cited by The New York Times, two applicants recommended by a wealthy banker with ties to an MIT board member received special consideration and were included on a “cases of interest” list.
In a deposition, MIT’s Director of Admissions admitted that the two students in question were among those who likely “would really have not otherwise been admitted.”
This admission suggests that family wealth and institutional connections can exert substantial influence on admissions decisions at even the most academically selective institutions.
The lawsuit also highlights practices at the University of Pennsylvania (Penn), where certain applicants were marked with a “B.S.I.” (Bona Fide Special Interest) tag. According to The New York Times report, students with this designation had a significantly higher acceptance rate compared to the general applicant pool.
Former Associate Dean of Admissions Sara Harberson, in a deposition, described the B.S.I. tag as an indicator that the applicant’s family was either a major donor or had direct connections to Penn’s board of trustees.
“Those students were untouchable,” Harberson stated, according to The New York Times report. “They would get in almost 100 percent of the time, even if the student was incredibly weak, even if the student had a major issue in the application.”
This testimony portrays an admissions process where the power dynamics were heavily skewed in favor of wealthy applicants, creating a pathway for individuals who might not have otherwise been accepted based on merit alone.
In response to these allegations, Penn issued a statement refuting the claims. According to The New York Times, Penn stated that the university does not favor applicants based on their families’ financial contributions and emphasized that “only qualified candidates are admitted.”
The statement further asserted that Penn takes great precautions to ensure that no preference is given to donors or their families, framing the lawsuit as an attempt to embarrass the university rather than address legitimate grievances.
At its core, this lawsuit questions whether these universities have adhered to federal antitrust laws and the principles of need-blind admissions policies.
The plaintiffs argue that favoring wealthy applicants undermines the very foundation of equal opportunity in higher education, perpetuating inequality and restricting access to elite institutions for academically qualified but less affluent students, as was noted in The New York Times report.
Defendants, on the other hand, maintain that the legal framework they operate under allows for discretion in admissions, and that financial considerations—while part of the equation—do not constitute discrimination against poorer applicants.
The revelations from this lawsuit are part of a larger conversation about equity, access, and privilege in college admissions. The New York Times reported that for decades, elite institutions have been criticized for practices that disproportionately favor wealthy applicants, including preferences given to children of alumni, admissions driven by expectations of large financial contributions and designations that flag applicants with influential connections.
These practices contribute to systemic barriers that limit access for underrepresented and lower-income students.
In response to the lawsuit, MIT issued a statement denying any history of wealth favoritism in its admissions process. The institution insisted that years of legal discovery and the review of millions of documents produced just one isolated example in which a board member’s recommendation may have influenced admissions decisions for two undergraduate applicants.
According to The New York Times, Kimberly Allen, an MIT representative, stated: “Contrary to what the plaintiffs claim, the potential for philanthropic gifts had no bearing on these isolated cases, and in fact, our records reflect that the children of wealthy individuals routinely receive disappointing news from MIT.”
MIT’s statement highlights the institution’s broader defense—that isolated incidents do not reflect systemic wrongdoing. Nevertheless, the example cited in the lawsuit raises concerns about whether external influence, even in rare cases, compromises the integrity of a supposedly merit-based admissions process.
Similarly, Georgetown University has strongly denied the allegations presented in the lawsuit. In an emailed statement to The New York Times, Meghan Dubyak, a spokeswoman for Georgetown, stated that the documents filed in the lawsuit offer only a “limited and inaccurate view of Georgetown admissions.”
She emphasized: “The school admits only students who will thrive in, contribute to, and further strengthen our community.”
Dubyak further asserted that Georgetown does not knowingly solicit or accept gifts from individuals with relatives applying for admission, seeking to dispel the notion that financial contributions played a decisive role in the admissions process.
Additionally, The New York Times report said that Georgetown officials have pointed to court documents in which they dispute the lawsuit’s claims, including allegations that universities involved in the case ever shared a financial aid formula—a central point of contention in the lawsuit.
The plaintiffs argue that the group of 17 universities, which included elite institutions such as MIT, Georgetown, the University of Pennsylvania, Notre Dame, and Johns Hopkins, operated as a “cartel” under the guise of a now-expired antitrust exemption.
According to the information provided in The New York Times report, this exemption allowed these institutions to share financial aid formulas and methodologies, but only under the strict condition that their admissions processes remained entirely need-blind—meaning a student’s financial circumstances would not be considered during admissions decisions.
The plaintiffs claim that the universities violated this agreement by factoring wealth and donation potential into their admissions decisions, thus undermining the supposed need-blind process.
Furthermore, the plaintiffs contend that the universities artificially inflated students’ expected financial contributions by agreeing not to undercut one another in the allocation of financial aid.
This alleged practice, if proven true, means that families may have been required to pay more for tuition than they otherwise would have in a competitive financial aid system.
While the lawsuit remains ongoing for some defendants, 10 of the original 17 universities have already reached settlements, collectively paying $284 million to the plaintiffs. According to The New York Times report, this settlement money will allow affected students—estimated to number around 200,000 over two decades—to apply for reimbursement grants of up to $2,000.
This financial compensation calls attention to the scale of the lawsuit’s claims and serves as an acknowledgment, at least from the settling institutions, of potential financial inequities in their aid processes.
However, other institutions, including MIT and Georgetown, remain steadfast in their defense, asserting that their admissions processes are fair, merit-based, and free from financial influence.
The plaintiffs’ legal team has been vocal about the implications of the newly filed documents. Robert Gilbert, one of the lawyers representing the plaintiffs, argued that the evidence reveals a “pattern of favoring students from wealthy backgrounds.”
According to the information in The New York Times report, Gilbert suggested that while individual incidents might seem isolated, they collectively point to a systemic bias in favor of applicants with deep-pocketed families and influential connections.
This alleged favoritism contradicts the principles of need-blind admissions and reinforces long-standing concerns about inequity and privilege in elite college admissions.
This lawsuit strikes at the heart of broader systemic questions: Can universities truly operate a need-blind process if financial contributions are sometimes factored into admissions decisions? Have families been overcharged due to collusion between elite institutions on financial aid formulas? Who holds private universities accountable for their admissions practices?
As The New York Times report emphasized, the case is not merely about isolated incidents but about whether these institutions are genuinely committed to fairness, transparency, and equal opportunity.
At the center of the revelations concerning Georgetown University is an incident involving the university’s former president, Dr. John J. DeGioia, who stepped down this year following a stroke. According to court documents reviewed by The New York Times, Dr. DeGioia intervened in a student’s admission after meeting her at the Allen & Company Conference in Sun Valley, Idaho, an exclusive annual event often referred to as “mogulfest” because of its high concentration of billionaires and influential figures arriving via private jets.
The lawsuit claims that the student in question had initially been deferred from Georgetown’s early action admissions process. However, following the Sun Valley meeting and an email exchange between Dr. DeGioia and the student’s father, she was later admitted from Georgetown’s “President’s List”—a list reserved for applicants flagged by the president for special consideration.
In his deposition, Dr. DeGioia justified the student’s admission by claiming that she had “overcome obstacles,” specifically citing her parents’ divorce as a qualifying factor. However, The New York Times reported that plaintiffs argued that the circumstances surrounding the student’s admission suggest that her family’s wealth and connections played a decisive role, rather than any demonstrated academic merit or significant personal hardship.
This revelation raises significant ethical and procedural questions about Georgetown’s admissions practices and whether the institution truly adheres to its claimed need-blind admissions policy.
The case also highlights significant developments at the University of Pennsylvania (Penn) regarding its financial aid practices. As reported by The New York Times, Penn withdrew from a coalition of universities in 2020 that had previously agreed on standardized financial aid formulas under a 1996 statute exempting them from antitrust regulations.
The purpose of this coalition was to create a standardized approach to financial aid distribution, ostensibly ensuring fairness and consistency in aid awards. However, the report in The New York Times said that Penn withdrew from the group, stating that it needed “more flexibility in offering financial assistance to students.”
This withdrawal came amid rising concerns about whether these standardized formulas were inadvertently artificially inflating costs for families and whether they restricted universities from offering the most competitive financial aid packages.
Following Penn’s departure, the entire coalition disbanded, as the legal exemption permitting the universities to exchange financial aid information expired. According to the New York Times report, this disbandment represents a significant turning point in the financial aid landscape for elite universities and highlights the increasing complexities surrounding tuition costs, financial aid, and the obligations these institutions have toward both transparency and equity.
As the lawsuit progresses in federal court in Chicago, the outcomes will have significant implications for elite universities’ admissions and financial aid policies. If the plaintiffs succeed, it could lead to increased regulatory oversight of admissions processes, greater transparency in how financial aid awards are determined and revised admissions protocols to prevent undue influence from donors or university leadership.
Conversely, if the universities successfully defend their practices, the case could set a precedent that institutional discretion in admissions remains protected under current legal frameworks.
As the case moves forward, it will not only determine the legal liability of these institutions but also set the tone for future conversations about privilege, access, and fairness in American higher education.
