Antitrust: Mitigate the Risk

Federal antitrust laws, including the Sherman Antitrust Act, the Clayton Antitrust Act, and the Federal Trade Commission Act, broadly aim to promote marketplace competition and prevent anticompetitive agreements or other conduct that suppresses competition  to the detriment of consumers, employees, and other industry competitors. Education is not immune, but antitrust vulnerabilities in this segment tend to involve competitor-collusion issues rather than monopolization issues that dominate some other industries. 

Educational Antitrust Issues 

Several well-publicized antitrust actions have involved  education. In 2020, the National Association for College Admission Counseling (NACAC) settled a case brought by the Department of Justice (DOJ) over rules that allegedly violated the Sherman Act by severely restricting NACAC members’ ability to recruit applicants and transfer students.  

Private antitrust lawsuits filed in 2022 and 2024 claimed, among other things, that “elite” private institutions colluded with each other to limit financial aid to students. Ten schools sued in the first lawsuit settled in 2024 for $284 million, and two more reached settlement agreements in early 2025 for more than $35 million.  

In a separate 2025 class action case involving early decision admission practices, current and former students accused 32 private universities of illegally conspiring not to compete for students admitted through early decision, in turn allegedly suppressing tuition and financial-aid competition. In August 2026, the court denied the schools’ motion to dismiss, letting the allegations against them proceed.   

Other practices that can run afoul of antitrust laws include wage-fixing and “no-poach” agreements, in which competing K-12 schools or higher ed institutions agree to set compensation or agree not to recruit, solicit, or hire each other’s faculty or staff.   

These agreements do not have to be formal, explicit, or written to violate the law. Schools also can create antitrust risk by exchanging nonpublic, competitively sensitive information — such as wage, benefit, tuition (including discounts), financial aid, or recruiting information — with other schools, especially when the exchange could facilitate coordination among institutions.  

Reduce Your Risk With Proactive Steps 

Antitrust litigation is complex and costly, but recent cases show that tuition, financial aid, admissions, employment, and athletics practices can create antitrust exposure for educational institutions. Higher ed institutions and independent K-12 schools alike should take steps to avoid sharing information with their peers or otherwise coordinating with them on these subjects to reduce their chances of being sued for alleged antitrust violations (or strengthen their defenses and mitigate potential damages if litigation occurs). Failing to do so  could lead to potentially crippling financial penalties and severe reputational harm. 

Understand the Legal Landscape 

School officials do not have to be legal experts, but a general understanding of antitrust law and how it may apply to educational institutions can help you spot potential problems and recognize when your school needs legal advice. 

The DOJ and the Federal Trade Commission (FTC) both enforce antitrust laws, although the scope of their authority differs. Only the DOJ can bring criminal prosecutions, which are relatively rare but can result in severe penalties. For example, some Sherman Act violations can expose entities to fines of up to $100 million and individual violators to fines of up to $1 million plus prison time. The DOJ and FTC share responsibility for civil enforcement of antitrust law and typically coordinate their activities to avoid duplication. Civil enforcement can result in injunctions and other remedies. In addition, as noted above, people harmed by antitrust violations can bring their own lawsuits. Under federal antitrust laws, successful private plaintiffs generally can recover three times their damages, plus costs and reasonable attorneys’ fees. 

Check Your Policy 

Does your school have a written policy or guidelines mandating employee compliance with antitrust laws and prohibiting certain conduct? If not, we recommend working with legal counsel to create this guidance. These rules should, for example, require school officials to independently make decisions about student and employee recruiting, admissions, athletics, tuition, financial aid, and faculty and staff compensation. They also should specifically prohibit agreements, coordination, or data sharing with peer institutions in these areas. In addition, consider requiring employees to seek internal legal or compliance advice before exchanging sensitive student or employee data (particularly current data) with competitors.  

Consider State Laws 

Most states have antitrust laws modeled on (but not necessarily identical to) federal law, which may provide additional theories of recovery or remedies. State attorneys general can enforce their own antitrust laws and, in some circumstances, pursue federal antitrust claims on behalf of state residents. Institutions could potentially face federal and state claims arising from the same alleged anticompetitive conduct. 

Train Personnel 

Educate your employees, especially those in admissions/enrollment, financial aid, athletics, human resources, the provost’s office (regarding faculty employment), and those who participate in associations of peer institutions, to recognize and avoid potentially risky conduct. What might appear to them as harmless “cooperation” or “collaboration” between peer schools could amount to unlawful collusion under antitrust laws. 

Incorporate this topic into your regular employee training cycle. Although most employees do not need to know the intricacies of antitrust law, they should be able to recognize,  avoid, and report behavior that can cause problems for your K-12 school, college, or university. 

In consultation with counsel, consider training your trustees or board members on antitrust issues, including pitfalls such as exchanging sensitive information about tuition, financial aid, or employee compensation with peer institutions.  

During training: 

• Review your relevant written policies or guidelines.
• Specifically advise employees to avoid formal or informal agreements with other schools regarding tuition, financial aid packages, student recruiting, employee hiring decisions, salary/wages, or benefits. They also should avoid exchanging nonpublic, sensitive information or data about students or employees without prior legal advice. Admissions staff in particular should be aware that exchanging information about financial aid and admissions decisions have been targeted by plaintiffs’ attorneys when bringing antitrust lawsuits against educational institutions. 
• Emphasize the penalties for antitrust violations. Potential institutional liability includes significant fines and the risk of serious, long-term reputational damage. 
• Explain how employees should report concerns related to antitrust issues. Consider providing an anonymous option. 
  
  Teach employees when and how to make a “noisy withdrawal” if they find themselves in a “sharing” situation that might create antitrust concerns. For antitrust purposes, a noisy withdrawal is a documented action that can help your institution and individual employees avoid implication in allegations of an unlawful conspiracy. If your employees attend a meeting in which other people mention potential actions that could create antitrust risks (such as conversations between institutions regarding admission criteria, tuition rates, or financial aid formulas), they should: Immediately inform others in the meeting that they will not participate.
• Physically leave the meeting, whether it is in-person or virtual.
• Document the incident and promptly report it to your legal or compliance team.
• Depending on the circumstances, consider following up in writing to make clear that your institution has no intention of participating in any information exchanges on the topic.

Recommended Actions After Possible Violations

If your institution suspects it may have engaged in conduct that creates an antitrust risk:      

• Consult experienced antitrust counsel immediately to evaluate the conduct and your potential exposure.
• With counsel’s guidance, investigate the suspected violation to determine who was involved in the conduct, when and for how long it occurred, and which other institutions or people participated. 
• Stop potentially risky conduct as quickly as possible by suspending in writing questionable agreements, coordination, cooperation, or information sharing with other institutions.
• Preserve relevant documents, including meeting notes, emails, texts, and other communications. 
• Avoid recurrences through remediation. Update your policies and procedures, train (or re-train) appropriate staff, and increase legal/compliance reviews of higher-risk activities involving competitors. 

More From UE 

Athletics Resource Collection  

Additional Resources 

National Association of Independent Schools: Proceed With Caution — How Antitrust Law Affects Schools (login required) 

This material is presented for general informational and risk management purposes only. It should not be considered legal, coverage, or other professional advice. Readers should consult their legal counsel, broker, or other appropriate adviser regarding their specific circumstances. 

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