The current domestic cases include:
(1) On October 5, 2016, a student filed suit against us and Walden University in the United States District Court for the Southern District of Ohio in the matter of Latonya Thornhill v. Walden University, et. al., claiming that her progress in her program was delayed by Walden University and seeking class action status to represent a nationwide class of purportedly similarly situated doctoral students. The claims include fraud in the inducement, breach of contract, consumer fraud under the laws of Maryland and Ohio, and unjust enrichment. Laureate and Walden University were served on October 17, 2016. On December 16, 2016, Laureate and Walden University filed a motion to dismiss the claims and a motion to strike the class action certification request. On January 12, 2017, the plaintiff filed an amended complaint, making modifications to supplement some of the factual allegations and seeking to change the governing law of the case to the law of Minnesota. A substantive response to the amended complaint was filed on February 9, 2017. The Thornhill court temporarily stayed this case in its entirety until May 1, 2017, pending the outcome of the Multi-District Litigation (‘‘MDL’’) proceeding discussed below. Following denial of the MDL transfer motion, the Thornhill court has temporarily stayed discovery until at least October 1, 2017, pending the determination on the motions to dismiss the complaint as well as the request for class action certification which remains pending.
(2) On October 18, 2016, a former student filed suit against Laureate and Walden University pro se in the United States District Court for the District of Maryland in the matter of Eric D. Streeter v. Walden University, et. al. (Case No. 1CCB6-CV-3460), claiming that his progress in his program was delayed by Walden University and Laureate. The claims include unjust enrichment, breach of contract, violation of the Maryland Consumer Protection Act, violation of the Due Process Clause in the Fourteenth Amendment, libel, and violation of the False Claims Act. Laureate filed a motion to dismiss on April 12, 2017, which remains pending. Walden University and Laureate intend to defend against this case vigorously.
On December 1, 2016, five students filed suit against us and Walden University in the United States District Court for the District of Minnesota in the matter of Jennifer Wright, et al v. Walden University, et. al., claiming that their progress in their programs was delayed by Walden University and seeking class action status to represent a nationwide class of purportedly similarly situated doctoral students. The claims include fraud in the inducement, breach of contract, consumer fraud, and breach of implied covenant of fair dealing under the laws of Minnesota, California, Georgia, Washington and Michigan, and unjust enrichment. Walden University and Laureate were served in this matter on December 8, 2016, Walden University and Laureate intend to defend against this case vigorously, including the request to certify a nationwide class. On January 13, 2017, we filed a motion to dismiss, or in the alternative to stay proceedings, pursuant to the first-filed rule, based upon the fact that the Thornhill case was filed first in Ohio. The Wright court issued an order on April 21, 2017 granting the defendants’ motion to dismiss (without prejudice). The plaintiffs may seek leave to join the Thornhill case or may file individual cases without class allegations.
(3) On December 29, 2016, a former student filed suit against us and Walden University in the United States District Court for the District of Minnesota in the matter of Aaron Bleess, et al v. Walden University, et. al (Case No. 16-CV-4402), claiming that his progress in his program was delayed by Walden University and seeking class action status to represent a nationwide class of purportedly similarly situated doctoral students. The claims include, under the laws of Minnesota, breach of contract, consumer fraud, breach of implied covenant of fair dealing, fraudulent inducement, unjust enrichment, and violation of the Deceptive Trade Practices Act and Consumer Protection Fraud Act. Laureate and Walden University were served on January 5 and January 6, 2017, respectively. On January 17, 2017, we filed a motion to dismiss, or in the alternative to stay proceedings, pursuant to the first-filed rule, based upon the fact that the Thornhill case was filed first in Ohio. The Bleess court stayed the proceedings pending a ruling on this motion to dismiss. Walden University and Laureate intend to defend against this case vigorously, including the request to certify a nationwide class. This case appears to be nearly identical in allegations, including the same alleged class, as Thornhill and Wright. The court issued an order on April 21, 2017 granting the defendants’ motion to dismiss (without prejudice). The plaintiffs may seek leave to join the Thornhill case or may file individual cases without class allegations.
(4) On December 23, 2016, counsel for the plaintiffs in Thornhill and Wright filed a motion to consolidate pretrial proceedings in these matters, as well as the Streeter and Medellin matters, to the United States Judicial Panel on MDL. Bleess’s counsel filed a notice of intent to participate as an interested party of the consolation motion. Laureate and Walden University filed a motion in opposition to transfer to MDL on January 17, 2017, which was opposed on January 24, 2017. A hearing was held on March 30, 2017 and the MDL panel issued an order on April 5, 2017 denying the plaintiffs’ motion to transfer.
https://www.sec.gov/Archives/edgar/data/912766/000162828017008326/laur6302017-10xq.htm