Shorter Sixth Circuit: It’s unreasonable for prospective law students to expect a law school’s representations about its employment statistics to be, you know, true:
Nor can the graduates establish a claim for fraudulent misrepresentation based
on the statistic for “average starting salary for all graduates” because their reliance
on it was unreasonable. The graduates alleged that Cooley committed fraudulent
misrepresentation by including the line in each year’s Employment Report and Salary
Survey stating the “average starting salary for all graduates.” (my emphasis)
For example, the Employment Report for 2010 states that the “average starting
salary for all graduates” was $54,796. On its face, the phrase “all graduates” means just
that: all Cooley graduates—not just the ones who responded to the survey—made,
on average, $54,796. One could assume that, because there were 934 graduates, the
average starting salary for all 934 graduates was $54,796. The title of the document
containing this statement is “Employment Report and Salary Survey.” Therefore, it
cannot be that the average starting salary of all 2010 graduates was $54,796, because the
document, entitled “Employment Report and Salary Survey” (emphasis added) was not
based on the responses of all of the Cooley graduates in 2010; rather, the document
states that the number of 2010 graduates was 934, but the number of graduates with
employment status known was 780. So, the “[a]verage starting salary for all graduates”
would instead mean the average starting salary of graduates who responded to the survey
and chose to include their salary information—not the average salary of all Cooley
graduates in any given year.
We agree with the district court that this statistic is “objectively untrue,”
MacDonald, 880 F. Supp. 2d at 794, but that the graduates’ reliance upon it was “also
unreasonable,” id. at 796, which dooms their fraudulent misrepresentation claim.
Despite the statement’s untruth, the graduates cannot demonstrate that their
reliance on this statement was reasonable. Unreasonable reliance includes relying on an
alleged misrepresentation that was expressly contradicted in a written contract that a
plaintiff reviewed and signed. Novak, 599 N.W.2d at 553–54; Nieves, 517 N.W.2d at
237–38. A plaintiff unreasonably relies on one of the defendant’s statements if another
of the defendant’s statements contradicts it.
Here, the statement “average starting salary for all graduates” expressly
contradicted other statements in the very same report showing that the report itself was
based not on data for the entire class, but on data from those who completed the surveys.
The Cooley graduates’ reliance on the statement that the “[a]verage starting salary for
all graduates” was “$54,796” was unreasonable in light of both the statement that the
“[n]umber of graduates with employment status known” was less than the total number
of graduates and the very title of the report (a “Salary Survey”). Because their reliance
was unreasonable, their claim for fraudulent misrepresentation failed as a matter of law.
Therefore, the district court properly dismissed the claim.
Note: Per information Cooley posted on its web site while the suit was ongoing but has since taken down, the school had salary information for a total of 6.5% of the 2010 class. That was the school’s basis for its claim regarding the “average starting salary for all graduates.” (Emphasis added. LST posted the stats here before Cooley scrubbed its web site.)
In other words, if a law school publishes not merely misleading statistics but flat-out lies (“objectively untrue” statements), it won’t be liable for doing so as long as a close reading by sufficiently cynical and suspicious reader — for example, a lawyer! — would reveal that those statements are likely to be untrue, because they contradict other statements in the document (how readers are supposed to figure out which of the contradictory statements are actually true isn’t something the Sixth Circuit panel explains). Furthermore, if you tack the word “survey” to the title of a document whose text claims that it’s a comprehensive survey, that means the survey isn’t actually comprehensive, because also.
Even shorter Sixth Circuit: Suckers!