USC to Pay $50 Million to Settle Legal Dispute

The University of Southern California has agreed to pay $50 million to the University of California, San Diego, to settle a highly unusual lawsuit over USC's hiring of a world-class Alzheimer’s researcher away from San Diego. The settlement is the latest in a string of embarrassing and costly missteps for USC.

UC San Diego filed the lawsuit in 2015 charging that USC and Alzheimer’s researcher Paul Aisen illegally agreed to attempt to take federal funding and research data from UC San Diego after Aisen accepted a lucrative position at USC. Aisen and UC San Diego disputed whether certain research grants were awarded to the university or to him. The original lawsuit also alleged that Aisen and USC attempted to take research data and employees with him in his move.

USC officials originally denied the allegations in 2015, saying they were “surprised and disappointed that the University of California, San Diego, elected to sue its departing faculty member and his team, as well as USC, rather than manage this transition collaboratively, as is the well-accepted custom and practice in academia.”

UCSD, in turn, said it was USC that had acted outside the bounds of normal practice, in which universities frequently woo researchers (and research teams) away from peers. Among other things, the lawsuit accused Aisen and USC of incorrectly telling UCSD employees that they might be out of a job if they didn’t follow him to USC, and of using some employees as “double agents” to try to get other employees and research funders to move with the project to USC.

On Tuesday, USC and UC San Diego both released statements saying the universities had reached a settlement in the case. Neither statement included details on the terms of the settlement, but an Inside Higher Ed open records request revealed USC agreed to pay the UC Board of Regents $50 million within 30 days.

"USC and Dr. Paul Aisen regret that the manner in which Dr. Aisen and members of the [Alzheimer's Disease Cooperative Study] staff left UC San Diego and brought research assets to USC created disruption to UC San Diego," USC's statement read. "These actions did not align with the standards of ethics and integrity which USC expects of all its faculty, administrators and staff.

“USC is committed to, and wants to be known for, ethics, integrity and the pursuit of academic excellence, and it has already implemented sweeping changes to this end. These standards will apply to all aspects of university operations, including the recruitment and/or transition of faculty members to or from USC. USC regrets that actions in this case fell short of these standards.”

Aisen led the Alzheimer’s Disease Cooperative Study, a UC San Diego-sponsored research program. According to court documents, UC San Diego accused USC of secretly bargaining with Aisen in order to transfer the program to USC. Aisen is alleged to have worked alongside other members of the ADCS program to force the transfer and to work as what UC San Diego's lawyers called "double agents."

According to this description of the case, Aisen and others engaged in activities such as inviting human resources staff members from USC to come to ADCS to help arrange the transfer of employees to USC.

Court documents claimed Aisen told potential sponsors of the research program that it would be moving to USC soon, after Aisen signed a deal that included a $100,000-per-year pay raise. Aisen resigned abruptly and refused to speak to his department chair about the transition and asked other employees to help him copy UC San Diego-owned data while claiming he owned it.

In 2015, a California court ordered the defendants to restore all data from the program to UC San Diego.

USC, as part of the settlement, cannot comment beyond the news release, which said USC and Aisen "acknowledge the outstanding work and the ongoing commitment and leadership of the researchers and administration at UC San Diego in the pursuit of cures for Alzheimer’s disease."

USC's Troubles Continue

While this controversy has been brewing for several years, the expensive and mortifying conclusion to it comes at a terrible time for USC.

The university has suffered a string of scandals in the last two years. It was one of several prominent institutions named as federal authorities announced indictments in an admissions scheme that allegedly allowed wealthy and privileged parents to buy their children’s way into college by taking advantage of athletic recruiting and by cheating on standardized tests.

USC has also been rocked by sexual assault allegations against a campus gynecologist and charges of drug use by its medical school’s now former dean, leading to the departure of its former president and questions about how the university is governed.

The dispute with UCSD revealed some of the same behaviors that USC has been accused of engaging in in some of the other recent scandals -- UCSD accused it of behaving unethically in pursuit of dollars and fame, part of a go-go environment of growth and prestige seeking.