Fun With Refunds, Part V.

In the bar review class action, the plaintiffs filed a first amended complaint yesterday against West Publishing Corp. dba Bar/Bri and Kaplan, Inc. This post exclusively highlights the changes to the parties, the substantive allegations and the prayer.

1. Changes to Parties

Three (3) new class representative plaintiffs have been added: Loredana Nesci, Jennifer Brazeal, and Lisa Gintz.

Ms. Nesci purchased the Connecticut Bar/Bri bar review course for $1,825. Ms. Brazeal purchased the Michigan Bar/Bri course at a price of $1,743, and Ms. Gintz bought the Louisiana Bar/Bri course for $858. (First Amended Complaint ["FAC"], paras. 12-14.) These new plaintiffs join Ryan Rodriguez, who bought the California Bar/Bri course at a price of $2,775, and Reena Frailich who purchased the same course for $2,519.25. (FAC, paras. 10-11.)

2. Changes to Substantive Allegations

The first amended complaint adds allegations in three (3) areas. First, the new pleading alleges that Bar/Bri agreed to pay Kaplan to exit the bar review business.

The first amended complaint reads: "during the weekend of August 9-10, 1997, an executive of Kaplan communicated with an executive of BAR/BRI in which BAR/BRI proposed that if Kaplan stayed out of the bar review business, BAR/BRI would exit at least the LSAT market in which it competed, plus pay to Kaplan a sum in excess of $500,000 per year, on the pretext that it would be compensation for some service Kaplan would be providing for BAR/BRI, but which, in fact, was part of the continuing consideration to be provided to Kaplan, on the condition that it stay out of the full-service bar review course market so long as such payments are made. Kaplan accepted this proposal. At the same time, both Kaplan and BAR/BRI also competed in the sale of CPA preparation courses. As to this line of commerce, the parties agreed to continue competing against each other. They then also agreed to 'strategically' work together in the future to promote their complementary businesses. Within the past four years, BAR/BRI has made, in connection with the aforesaid ongoing agreements, similar annual payments to Kaplan." (FAC, para. 37, p. 11:3-16.)

Second, the amended complaint augments the prior pleading with allegations of payments to law schools. "BAR/BRI has paid so-called 'consulting' fees to various law school administrators at least, in part, to assure that it maintains access to the use of such law school's assembly and common areas for marketing and related purposes and to further assure that any potential competitors will be unable to obtain such access." (FAC, para. 44(d), p. 14:17-21.)

Third, consonant with adding a Louisiana plaintiff (Ms. Gintz), the first amended complaint specifically addresses the Louisiana bar review market, as follows:

"As a further example of BAR/BRI consolidating its national monopoly in the provision of full service bar review courses, in Louisiana, for several years through 2003, there has operated a full-service classroom bar review preparation course in competition with BAR/BRI's, one of the very few states in which a competitor to BAR/BRI even existed at the time. That course, operated by Louisiana State University ("LSU"), most recently charged $545 per student, thus helped to keep down BAR/BRI's course pricing in Louisiana at the time to $695, a sum slightly in excess of that sum but far less than it charges elsewhere. However, in 2004, BAR/BRI secretly agreed to pay sums in excess of $50,000 per year to LSU, conditioned on LSU's agreement to stop offering its competitive course for at least three years. BAR/BRI has made at least the first such payment. Thereafter, BAR/BRI became the only provider of a classroom bar review course for the Louisiana Bar exam. It then immediately increased its bar review course price in Louisiana, charging $1095 for new bar course registrants, with plans to substantially increase its prices annually thereafter, unrestrained by competition. By its first increase in 2004, BAR/BRI more than doubled the price for which courses were available in Louisiana immediately prior to the date of said agreement. BAR/BRI's agreement to oust LSU as a competitor has been to the detriment of Gintz and other class members therein." (FAC, para. 44(f), p. 15:3-21.)

3. Changes to Prayer

In view of the new allegations regarding payments to law schools, the amended pleading seeks an order enjoining Bar/Bri from "paying or providing anything of value to any law school administrator or other staff member". (FAC, p. 25:15-16.) In addition, the plaintiffs request that the Court require West "make access to Westlaw [legal research site] for advertising purposes reasonably available to any bar review course provider on reasonable terms and conditions." (FAC, p. 25:17-19.)

We'll continue to keep you updated.