Oregon is seeking to become the lead plaintiff in a class action, securities fraud lawsuit against Apollo Group, the parent company of University of Phoenix. The suit charges that the university misled investors by not accounting for student withdrawals from courses, withdrawals that when exposed caused Apollo stock to drop -- causing a loss of about $10 million to Oregon's state retirement system, the suit charges. A statement from Ted Wheeler, Oregon's treasurer, said: "With this lawsuit, we hope to teach a lesson that businesses like the University of Phoenix cannot take advantage of their students or their investors." Manny Rivera, a spokesman for the company, told The Oregonian that "Apollo Group takes its disclosure obligations very seriously and intends to defend this lawsuit vigorously."
Higher Education Quick Takes
President Obama is expected to issue an executive order Tuesday aimed at strengthening federal efforts to improve the educational attainment of Hispanic Americans. The revised document, which will come on the heels of a summit held Monday by the White House Initiative on Educational Excellence for Hispanic Americans, is expected to establish a presidential commission that will work with community leaders to gather advice on Hispanic education, and an "interagency working group" to help coordinate the federal government's efforts on a wide range of issues important to Hispanic Americans, including housing, health, finance, employment and education.
Three campuses experienced fatal shootings of students in the last week:
- Police shot and killed Danroy Henry, a football player at Pace University, early Sunday morning after he allegedly tried to drive away from a bar fight, crashing into two police officers, The New York Post reported.
- A student at Lane College, in Tennessee, died last week after being accidentally shot by his roommate, the Associated Press reported.
- A student from Hampton University was shot and killed early Sunday morning at a post-homecoming party at California University of Pennsylvania, and two students were injured in the shooting, The Pittsburgh Post-Gazette reported.
Ronald Mason Jr., president of the Southern University System, set off a controversy last week when he suggested that the University of New Orleans be merged into the system. The University of New Orleans is part of the predominantly white Louisiana State University System, while Southern is historically black. Headlines about Mason's comments led some to believe he wanted to merge the UNO campus into Southern's New Orleans campus -- an idea he has since stressed isn't what he was talking about, The New Orleans Times-Picayune reported. The idea he wanted to put on the table -- likely equally controversial, but different -- was to move the University of New Orleans into the Southern system. Mason has experience with controversial merger proposals and black colleges, having in January, while president of Jackson State University, backed a plan to merge Mississippi's three public black colleges. (That plan didn't advance.)
Although an Arizona law added two seats to the board of the Maricopa Community College District, the seats have been delayed because of a federal review of the civil rights implications of the change, The Arizona Republic reported. The new seats would be elected at large, while the five current seats are all elected by districts within the district. The federal review focuses on whether the creation of at-large seats would dilute minority representation.
President Obama on Friday announced the 10 researchers who have been named recipients of the National Medal of Science. They are:
- Yakir Aharonov of Chapman University.
- Stephen J. Benkovic of Pennsylvania State University.
- Esther M. Conwell of the University of Rochester.
- Marye Anne Fox of the University of California at San Diego.
- Susan L. Lindquist of the Whitehead Institute of the Massachusetts Institute of Technology.
- Mortimer Mishkin of the National Institutes of Health.
- David B. Mumford of Brown University.
- Stanley B. Prusiner of the University of California at San Francisco.
- Warren M. Washington of the National Center for Atmospheric Research.
- Amnon Yariv of the California Institute of Technology.
Michigan's Department of Human Services has heard enough rumors that college students are abusing its equivalent of a food stamp program that it has deemed the idea "Myth No. 5" on its list of welfare program myths. But the Lansing State Journal, in an article published Thursday, quotes numerous store clerks complaining that local college students are using their "Bridge Cards" -- which are supposed to be used only for essentials -- on mixes for liquor and junk food. "They fill their carts with Red Bull, jerky, Doritos," one clerk told the newspaper. "They tell their friends, ‘Throw in whatever you want … the government’s paying for it.' ” While state officials said that as many as 18,000 college and university students were receiving food assistance at any given point in 2009-10, they called the notion of widespread abuse of Bridge Cards by students an urban legend.
The College Sports Project, an initiative of the Andrew W. Mellon Foundation, has again shed light on the academic performance of athletes in the National Collegiate Athletic Association’s non-scholarship Division III. Wednesday, the project, now entering its fifth year, released its latest report, which includes information on more than 83,000 athletes at 84 institutions. Among the report’s highlights, female athletes have higher grade point averages than male athletes. In addition, athletes who were recruited prior to admission had lower GPAs than athletes who were not recruited and non-athletes at their same institution; this was especially the case at “the most highly selective colleges.” As the NCAA does not gather much academic data on athletes in Division III, the overview provided by this project is one of few insights athletics watchdogs have into the little-examined division. NCAA officials have criticized the project in the past, however, arguing that its small sample size prevents it from offering an accurate picture of academic performance within the large division, which has more than 450 member institutions ranging from large state institutions to small, selective liberal arts colleges.
For-profit higher education stocks plunged across the board Thursday following confirmation from the industry's biggest player that pressure from Washington and negative press would probably hurt the company's bottom line for the foreseeable future. Shares of Apollo Group, the parent company of the University of Phoenix, fell more than 23 percent to a 52-week low of $38.00 a share. Education Management Corp., owner of the Art Institutes and Argosy University, among other institutions, also fell about 23 percent, to $10.22 a share.
The tumble follows Apollo's late Wednesday release of earnings data for the fourth quarter of its 2010 fiscal year, which showed new enrollments ("starts," in industry lingo) falling 10 percent, to 92,000 students, and projected that new starts in the first quarter of 2011 could be down as much as 40 percent over a year ago. Phoenix had already announced plans to require a three-week orientation course for students entering with fewer than 24 college credits (it becomes mandatory on Nov. 1), and said that it would stop compensating recruiters in part based on the number of students they enrolled. But the projection that those and other changes would damage starts -- the major source of revenue growth for for-profit colleges -- and cut the company's profits in the short term led some analysts to downgrade their outlooks on the company and the sector. At the same time, some analysts praised Apollo officials for making changes that appear to emphasize student outcomes over the bottom line.
The University of Southern California plans to announce today that it has received two gifts totaling $100 million aimed at showing how technology is transforming academe and industry, the Los Angeles Times reported. The gifts, to be announced on the day that USC inaugurates its new president, C.L. (Max) Nikias, are designed to create a new cancer treatment focused on nanomedical research and a new building for high-tech journalism studies, the Times reported. The donations come from an alumnus and from the Annenberg Foundation, respectively.