Whistle-Blower Cases Against Kaplan Go Forward, With Some Claims Dismissed

In a series of rulings this month, a federal judge has dismissed many of the most sensational accusations of wrongdoing by Kaplan Higher Education contained in a trio of "whistle-blower" lawsuits filed by former employees.

But Kaplan still faces legal action on a number of claims in those lawsuits, which allege that it fraudulently obtained millions of dollars from the federal government in student-aid funds by illegally paying bonuses to student recruiters and by inflating students’ grades and manipulating the job-placement rates of its colleges’ graduates. Kaplan has maintained that the lawsuits are meritless.

The company also faces accusations that it retaliated against two employees who say they were fired after telling the company that they would report wrongdoing, and that it misled the government by falsely claiming that it was complying with laws protecting employees with disabilities.

Kaplan Higher Education, a division of Kaplan Inc. (which is itself a wholly owned subsidiary of the Washington Post Company) had faced three separate whistle-blower suits under the False Claims Act, a federal statute that allows parties to sue on behalf of the government to recover fraudulently obtained government funds. One suit was filed by three former employees of Kaplan University; a second by two former employees of a Kaplan Career Institute ICM; and a third by a former employee of Kaplan College in Milwaukee. Because the cases included similar allegations, they were consolidated before a single judge in Florida who was assigned the duty of sorting out which allegations would be considered.

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THE CHRONICLE OF HIGHER EDUCATION

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