A Philadelphia federal appeals court last week ruled in favor of the Massachusetts Institute of Technology in a case the Justice Department filed four years ago against the university for violating federal antitrust laws.
MIT officials say the decision may slow down the bidding wars between elite institutions for top students who need financial aid.
But College officials here say discrepancies in financial aid packages offered to a student by different universities, which have recently differed by as much as $5,000, would still exist if the Justice Department had not filed suit against MIT and other universities including Dartmouth in 1989.
Before 1989, representatives from the eight Ivies, MIT, and 20 other schools met four times a year to decide how much aid money they would give to certain prospective students so each institution could offer similar or identical packages.
But in the fall of that year, the Justice Department started investigating allegations that meetings between the Overlap colleges violated antitrust laws. A year and a half later, the Ivy League schools avoided a lawsuit by signing a consent decree with the Justice Department that forbids them from price fixing for financial aid.
But MIT alone refused to sign the decree, claiming the Sherman Antitrust Act, which prohibits price fixing by corporations, should not apply to institutions of higher education. Last Friday, a lower court's ruling against MIT was reversed.
"Basically MIT has won the right to go back and start from the beginning," said Tom Soybel, Dartmouth's associate college counsel. MIT has already spent more than $1 million on the lawsuit and now must argue the case from the start again.
Though Dartmouth is not offering MIT any financial support, Soybel said a decision in the university's favor would benefit all the schools that attended the Overlap meetings.
"While we conceded to the settlement two years ago that put an end to overlapping, [MIT is] litigating the right to do it," Soybel said. "If they ever win, that will turn a lot of people loose, us among others."
Even if MIT wins the case, it could not share information with former members of the Overlap group, because those schools have all promised the government that they will not collaborate on financial aid.
Soybel said the College would most likely renegotiate its agreement with the government if MIT wins its case.
But Dean of Admissions and Financial Aid Karl Furstenberg said changes in determining financial aid that have emerged since the decree was signed make overlap unnecessary for the College .
"Competition between the Ivies has been increasing and some of the differences in financial aid awards would have happened anyway," Furstenberg said.
He said with fewer colleges offering need-blind admissions and schools developing different methods to determine the amount of aid offered, competition between schools for top students would have increased even if the Overlap group still existed.
Though Furstenberg said the College's financial aid awards are competitive, about 10 percent of students who receive packages call his office saying a comparable school has offered them more aid. But he said the number of calls to the College has not increased since the antitrust ruling.
Director of Financial Aid Virginia Hazen said that since the breakup of the Overlap group, students and families picking a school have had to consider the price of the student's education.
Furstenberg said that if students get a better deal at another school, the College re-examines the financial aid packages and often decides to offer more aid.
