515 F.Supp.3d 861
N.D. Ill.2021Background
- Plaintiffs are three undergraduate students and two parents who paid tuition/fees for Loyola’s Spring 2020 semester; suit alleges breach of contract and unjust enrichment for Loyola’s shift to remote instruction after COVID-19 closures.
- Loyola moved classes online in March 2020 and closed residence halls; it had separate tuition/fee schedules for in-person vs. online programs and provided limited partial refunds (room/board, some fees).
- Plaintiffs allege Loyola’s course catalog, brochures, and registration portal promised in-person instruction and campus access and that remote instruction was worth substantially less.
- Plaintiffs seek monetary recovery equal to the difference in value between promised in-person services and the online education actually received.
- Loyola moved to dismiss under Fed. R. Civ. P. 12(b)(1) and 12(b)(6). The court dismissed the two parent-plaintiffs for lack of standing and dismissed both counts with prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing of parent-plaintiffs (Gociman, Hickey) | Parents who paid tuition can sue to recover payments made for their adult children | Parents of adult students lack Article III injury; payment alone does not create contractual rights | Parents dismissed for lack of standing |
| Breach of contract—educational malpractice | Loss stems from complete failure to provide promised in-person services, not mere inferior quality | Claims challenge quality/value of education and thus amount to barred educational malpractice | Contract claim is educational malpractice and not cognizable |
| Breach of contract—existence of an identifiable promise to provide in-person instruction | Course catalog notations, residency requirement, and price differential imply a contractual promise of on-campus instruction | Catalog expressly disclaims contract status and reserves right to change course structure; tuition differences insufficient to create a specific promise | Plaintiffs failed to plead an identifiable contractual promise; Count I dismissed with prejudice |
| Unjust enrichment (alternative remedy) | Equity supports restitution because Loyola retained tuition for a lesser-valued service | Relationship governed by contract-like documents; unjust enrichment unavailable where an express contract governs or is alleged | Count II dismissed with prejudice (incorporates contract allegations and fails if contract claim fails) |
Key Cases Cited
- Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (articulates the Article III injury-in-fact standing standard)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (three-element Article III standing test)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must be plausible to survive dismissal)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (legal conclusions alone insufficient at pleading stage)
- Bissessur v. Indiana Univ. Bd. of Trs., 581 F.3d 599 (7th Cir. 2009) (educational-malpractice claims are barred)
- Ross v. Creighton Univ., 957 F.2d 410 (7th Cir. 1992) (courts will not second-guess academic judgments)
- Bd. of Curators of Univ. of Mo. v. Horowitz, 435 U.S. 78 (1978) (deference to universities on academic matters)
- Reger Dev. v. Nat’l City Bank, 592 F.3d 759 (7th Cir. 2010) (elements required to plead breach of contract)
- McReynolds v. Merrill Lynch & Co., Inc., 694 F.3d 873 (7th Cir. 2012) (pleading rule that legal conclusions are insufficient)