New York, NY (March 21, 2012) – Venable attorneys in New York today obtained a dismissal of all claims brought by a putative class of New York Law School students and alumni in the Gomez-Jimenez v. New York Law School case, filed in New York State Court.
The fundamental claim in the New York Law School case was that students and applicants relied on misleading information disseminated by the school, concerning its graduates’ employment and salaries, in making their decision to attend New York Law School.
Plaintiffs alleged that they found themselves in disadvantaged employment positions upon graduation and were damaged in an amount equal to the difference between the alleged inflated tuition they paid because of the school’s published employment materials, and what Plaintiffs characterized as the unspecified “true value” of a New York Law degree. Plaintiffs withdrew their original complaint when the school, through Venable, moved to dismiss. Justice Melvin L. Schweitzer’s decision addressed the sufficiency of Plaintiffs’ amended complaint.
In his opinion, Justice Schweitzer wrote that “the issues posed by this case exemplify the adage that not every ailment afflicting society may be redressed by a lawsuit.” He reminded the Plaintiffs that the real world effect of the economic downturn in 2008 was a reduction in the number of opportunities for lawyers at all points of entry in the profession, that layoffs abound. He also enumerated several other economic factors which have curtailed law firm hiring.
Justice Schweitzer’s decision dismissed each of Plaintiffs’ claims of statutory consumer fraud, common law fraud and negligent misrepresentation and adopted many of the arguments Venable set forth in its briefs and at the recent oral argument. Most significantly, for purposes of the consumer fraud claim, the Court emphasized that the school’s statements were not misleading in a material way to reasonable consumers acting reasonably under the totality of the circumstances, and applicants had a wealth of information regarding their realistic employment prospects before, during and after the onset of the Great Recession. As such, reasonable consumers would have evaluated such information in deciding whether to incur debt and pay for an expensive graduate education, and the very fact of the Great Recession was a “supervening cause” of Plaintiffs’ poorer job prospects, which was fatal to all the claims. The Court likewise found that the widespread availability of information relating to the poor economic climate renders any reliance on allegedly misleading employment data unreasonable as a matter of law.
Finally, Justice Schweitzer held that Plaintiffs’ theory of damages (that they should be awarded the difference between what they paid for their law degrees and an amount representing the degree’s alleged lesser intrinsic worth) was “entirely too speculative and remote to be quantified as a remedy under the law.”
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