Inside Higher Ed: Jury Orders U. of Phoenix Parent to Pay $277 Million
With a major lawsuit challenging its admissions practices looming on the horizon, the Apollo Group — parent of the University of Phoenix — took a beating in another legal proceeding Wednesday.
A federal jury in Arizona ordered Apollo to pay an estimated $277.5 million to shareholders who sued the higher education company and two former executives in 2004 for securities fraud. The lawsuit alleged that company officials withheld a harshly critical U.S. Education Department report in February 2004 that accused Apollo of violating a federal prohibition against paying recruiters based on the number of students they enrolled. The company did not disclose the report in its Securities and Exchange Commission filings or in calls with analysts or reporters for months.
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