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Papers Say Lawsuit Should Be Dropped

In the wake of the Sept. 17 Appeals Court reversal of the district court decision in the MIT antitrust case, seven newspapers from four states and Washington, DC have urged the Justice Department to drop the suit against MIT and the "overlap" system of collaborating with other colleges to verify financial aid eligibility.

The Justice Department has not yet made a decision on the case, except that it has informed MIT's lawyers that it will not exercise its right (which had to be done by Oct. 15) of appealing the case "en banc" to all 10 judges of the Appellate Court of the Third District in Philadelphia. The Justice Department could drop the case, reargue it before the District Court on the pro-competitive and social welfare objectives of the overlap system, or appeal directly to the US Supreme Court.

The newspapers, in order of appearance of the editorials, are: The New York Times, The Boston Globe, The Fresno Bee, The Sacramento Bee, The Boston Herald, The Sarasota Herald Tribune and The Washington Post.

The New York Times editorial of Sept. 27 was reprinted in MIT Tech Talk on Sept. 29. Here are headlines and excerpts from the other six editorials, in chronological order.

The Boston Globe, Sept. 29, "An F in antitrust law": "Unlike eight of its timid counterparts in academia, the Massachusetts Institute of Technology had the courage in 1991 to take on the Justice Department when the university stood accused of violating antitrust laws. Common sense prevailed last week when a federal appeals court reversed the decision, opening the way for review. This prosecutorial boondoggle, rooted in the Bush administration, has already gone too far. Attorney General Janet Reno's antitrust division can surely find more venal targets than universities seeking to advance broad social benefits through common policies on financial aid."

The Fresno Bee, Fresno, CA, Oct. 2, and The Sacramento Bee, Sacramento, CA, Oct. 3, "Justice loses, kids win": "A federal appeals court has wisely struck a blow against the US Justice Department's efforts to stop colleges from conferring with each other about financial aid for needy students. Though the trial court originally sided with the Justice Department, refusing to consider any of the public benefits of such cooperation, the appeals court has now rightly concluded that those benefits are real and deserve to be weighed in a new trial. Rather than a new trial, the president could save everybody money and trouble by dropping the suit altogether. It only hurts poor kids."

Boston Sunday Herald, Oct. 3, "MIT, price-fixer?": ".For decades, the schools collectively set the amount of financial aid offered to students who had already been admitted to more than one school. That practice had nothing to do with restraining trade. The universities' goal was to avoid costly bidding wars over gifted undergraduates and thereby stretch financial aid dollars as far as possible. That would make high-quality education available to the greatest possible number of needy students. The Justice Department should drop its case entirely. Maybe its prosecutors can't tell the difference between price collusion that rips off consumers and an intelligent policy for distributing charity. Attorney General Janet Reno, we hope, can."

Sarasota Herald Tribune, Sarasota, Fla., Oct. 3, "Promoting diversity is no crime": "Unless good sense prevails in the Justice Department, the case will go back to the trial court, will be appealed and re-appealed, and will, at great cost to the taxpayers and to MIT, be resolved, if not by the courts, then by Congress some years down the line with no assurance that the resolution will serve the public interest. The sure and simple way to reach the right outcome is for the Justice Department to forget about an appeal, withdraw its foolish indictment and free the Ivies from their consent decree.

"It is possible that, with Janet Reno as attorney general, the Justice Department might decide it is wasting money and energy. From the beginning, this case has been a perversion of the Sherman Act, which was passed in a (partially successful) attempt to curb profiteering by turn-of-the-century "robber barons" of oil, steel, meat packing and railroading. Why George Bush allowed his Justice Department to start this case is one of life's enduring mysteries. It will be an even greater mystery if Bill Clinton allows his Justice Department to keep it going."

The Washington Post, Oct. 14, "Drop the MIT Case": "The Justice Department argued that scholarship aid is like a store's discount. All eight Ivy League universities sighed and, on their lawyers' advice, decided not to contest it. But the Massachusetts Institute of Technology, with the stony logic peculiar to engineers, declared that it was right and it would fight. It pointed out that the allegedly anticompetitive rules expand the pool of students competing for admission by assuring them that, if they have the brains to get in, they will be given enough aid to get through. Abolishing the agreed rules would open the way to bidding among colleges for bright students whether they need aid or not. More aid for those who don't need it means less for those who do.

"The appellate court saw the point. For the Justice Department to pursue this case further would be a gross misallocation of its resources."

A version of this article appeared in the October 20, 1993 issue of MIT Tech Talk (Volume 38, Number 10).

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