Higher education cartel challenged in North Carolina lawsuit

The cloak of altruistic search for truth and selfless education of young minds worn by higher education obscures a self-serving, vast industry that sees nothing wrong in behaving like a cartel.  Do you think it is a coincidence that tuition levels at prestigious private universities are so similar to one another despite vast disparities in endowments?

But rarely does an opportunity come to prove that universities do not compete on an open and fair basis.  Such an opportunity may be at hand in a lawsuit filed in North Carolina.  Paul Caron of Taxprofblog writes:

Colleges and universities lure top faculty members away from competitor institutions all the time, and the practice is (generally speaking) entirely legal. But while some relish it, others consider faculty poaching, or actively recruiting faculty members from competitors, bad form and try to avoid doing it regularly -- especially to institutions in the same geographic area.

A new antitrust lawsuit alleges much more than a neighborly understanding between Duke University and the University of North Carolina at Chapel Hill, however. The suit, brought against Duke by a medical faculty member there, rather alleges a binding no-hire agreement between the two Research Triangle institutions prevented her from getting a job at Carolina that otherwise would have been hers. The faculty member alleges there are others like her, and she’s proposed a class action.

Danielle Seaman, an assistant professor of radiology at Duke, says she’s been trying to get a job at Carolina for three years. She allegedly interviewed and was told by Carolina's chief of cardiothoracic imaging in 2015 that her otherwise strong chance had been rejected because the respective deans of the medical schools at Carolina and Duke had a few years earlier formally agreed to not hire faculty members between institutions at the same rank, in order to control faculty salaries. ...

In a second email, sent in February after Seaman expressed interest in applying for an advertised position as a thoracic radiologist, the chief said he was prohibited from hiring her.

“I agree that you would be a great fit for our cardiothoracic imaging division,” the chief allegedly wrote. “Unfortunately, I just received confirmation today from the dean’s office that lateral moves of faculty between Duke and [Carolina] are not permitted. There is ‘reasoning’ for this guidance which was agreed upon between the deans of [Carolina] and Duke a few years back. I hope you understand.”

In a third clarification email sent in April, the chief allegedly wrote that “the ‘guideline’ was generated in response to an attempted recruitment by Duke a couple of years ago of the entire [Carolina] bone marrow transplant team; [Carolina] had to generate a large retention package to keep the team intact.”

Seaman says that the alleged agreement amounts to illegal conspiracy on the parts of Duke and Carolina to suppress employee compensation, and to “impose unlawful restrictions on employee mobility.” ...

I am not an expert at anti-trust law, but this looks like a very strong case, and probably a potentially criminal violation.

As Glenn Reynolds of Instapundit notes astutely: “Academics think capitalism is corrupt because that’s how academia is.”

The cloak of altruistic search for truth and selfless education of young minds worn by higher education obscures a self-serving, vast industry that sees nothing wrong in behaving like a cartel.  Do you think it is a coincidence that tuition levels at prestigious private universities are so similar to one another despite vast disparities in endowments?

But rarely does an opportunity come to prove that universities do not compete on an open and fair basis.  Such an opportunity may be at hand in a lawsuit filed in North Carolina.  Paul Caron of Taxprofblog writes:

Colleges and universities lure top faculty members away from competitor institutions all the time, and the practice is (generally speaking) entirely legal. But while some relish it, others consider faculty poaching, or actively recruiting faculty members from competitors, bad form and try to avoid doing it regularly -- especially to institutions in the same geographic area.

A new antitrust lawsuit alleges much more than a neighborly understanding between Duke University and the University of North Carolina at Chapel Hill, however. The suit, brought against Duke by a medical faculty member there, rather alleges a binding no-hire agreement between the two Research Triangle institutions prevented her from getting a job at Carolina that otherwise would have been hers. The faculty member alleges there are others like her, and she’s proposed a class action.

Danielle Seaman, an assistant professor of radiology at Duke, says she’s been trying to get a job at Carolina for three years. She allegedly interviewed and was told by Carolina's chief of cardiothoracic imaging in 2015 that her otherwise strong chance had been rejected because the respective deans of the medical schools at Carolina and Duke had a few years earlier formally agreed to not hire faculty members between institutions at the same rank, in order to control faculty salaries. ...

In a second email, sent in February after Seaman expressed interest in applying for an advertised position as a thoracic radiologist, the chief said he was prohibited from hiring her.

“I agree that you would be a great fit for our cardiothoracic imaging division,” the chief allegedly wrote. “Unfortunately, I just received confirmation today from the dean’s office that lateral moves of faculty between Duke and [Carolina] are not permitted. There is ‘reasoning’ for this guidance which was agreed upon between the deans of [Carolina] and Duke a few years back. I hope you understand.”

In a third clarification email sent in April, the chief allegedly wrote that “the ‘guideline’ was generated in response to an attempted recruitment by Duke a couple of years ago of the entire [Carolina] bone marrow transplant team; [Carolina] had to generate a large retention package to keep the team intact.”

Seaman says that the alleged agreement amounts to illegal conspiracy on the parts of Duke and Carolina to suppress employee compensation, and to “impose unlawful restrictions on employee mobility.” ...

I am not an expert at anti-trust law, but this looks like a very strong case, and probably a potentially criminal violation.

As Glenn Reynolds of Instapundit notes astutely: “Academics think capitalism is corrupt because that’s how academia is.”