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Tuesday, October 22, 2013

WSJ: InfiLaw's For-Profit Law School Plan Draws Critics

InfiLawWall Street Journal:  Private-Equity Group's For-Profit Law School Plan Draws Critics, by Ashby Jones:

In an era of declining law-school enrollment, at least one company is looking to invest in legal education.

But the private-equity-backed group, called the InfiLaw System, hasn't yet won over the legal academy.

Chicago-based private-equity fund Sterling Partners launched InfiLaw in 2004, shortly after buying the Florida Coastal School of Law in Jacksonville. InfiLaw soon launched two other for-profit schools—the Phoenix School of Law in Arizona in 2004 and the Charlotte School of Law in North Carolina in 2006. ...

Some in the academy think InfiLaw is compounding the problems in legal education, which is graduating far more students than there are entry-level jobs for lawyers. Critics, including former students who have sued Florida Coastal, see the company as a predatory outfit that peddles false promises to students in exchange for high tuitions.

Others think criticisms of InfiLaw are based on elitism embedded within the legal academy, and that it could increasingly play the role of white knight for law schools seeking a deep-pocketed investor or buyout partner. "InfiLaw is applying a private-equity model to legal education, and so far I'm fairly impressed by what I've seen," said William Henderson, a law professor at Indiana University who studies the legal profession. While its achievements so far are modest, said Mr. Henderson, "I think these are people who could make a difference in legal education."

For the most part, InfiLaw schools haven't had trouble filling seats—or bringing in money. Florida Coastal, for instance, enrolls about 1,250 students, making it one of the larger U.S. law schools. Charlotte enrolls about 1,360. Tuition and fees at all three run about $40,000 a year, according to the schools.

But judged by other metrics, the schools have been less successful. Bar-passage rates among their graduates have fluctuated in recent years but have often fallen well below state averages. And job-placement rates have suffered as well. In 2012, for instance, only about half of Charlotte's graduating class got jobs that required passing the bar, at least 10 percentage points below the state's other private law schools and the national average. ...

Adding to InfiLaw's woes: two recent federal lawsuits that accuse its schools of shady tactics designed to boost profits. Last year, a group of Florida Coastal graduates sued the school, alleging that it advertised misleading postgraduate employment statistics to lure prospective students. The group is seeking, among other things, $100 million in tuition repayments. And in June, two tenured professors at Phoenix School of Law sued the school and InfiLaw, claiming they were fired after objecting to proposals that would make it harder for students to transfer.

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