The California Institute of Technology, one of the wealthiest institutions in the world, has agreed to settle a class-action lawsuit alleging that it deceived students who enrolled in a boot camp under its name but actually had little connection to the institution.
According to the settlement, Caltech and an outside partner, Simplilearn, had to alter their boot camp advertising and impose additional limitations that jeopardized the program’s appeal. However, Caltech announced in an open letter on Monday that it would sever its relationship with Simplilearn later this year, the same day a court made public documents outlining the details of the settlement.
However, the deal could affect how other institutions promote comparable services, even if it still needs a judge’s permission.
Caltech is one of hundreds of universities nationwide, many of which are searching for new revenue streams, that have licensed their names to advertise courses that were actually operated by outside businesses. The university frequently has very little control over hiring, curriculum development, or instruction.
For every student that enrolls in a branded program, some colleges receive several thousand dollars; according to researchers, these fees total hundreds of millions of dollars annually for the entire higher education sector.
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