Settlement finalized in class-action lawsuit against La’ James International College
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May 7, 2024
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Settlement finalized in class-action lawsuit against La’ James International College
The agreement comes after years of misconduct by La’ James and a 2022 settlement led by former Iowa Attorney General Tom Miller
Student Defense and Wandro, Kanne & Lalor, PC announced today the final approval of a settlement of a class-action lawsuit filed on behalf of current and former students against La’ James International College, an Iowa-based chain of beauty schools. The lawsuit accused La’ James of violating the Iowa Consumer Fraud Act by illegally delaying disbursement of financial aid funds for living expenses, breaking the commitment it made to students when they enrolled, and causing them financial hardship. The settlement will reimburse class members $1500 each for the disbursement delay, discharge institutional debt, and require La’ James to change how it communicates to students about financial aid.
Many students who attend La’ James are from low-income backgrounds, have families to support, and often rely on federal financial aid for both tuition and living expenses. These funds are awarded to the students by the U.S. Department of Education but disbursed by institutions. Students reported that La’ James delayed distribution of their financial aid money by months. These delays caused students’ significant stress, forcing some to take out loans from other sources to pay for their basic needs and even pushing some students to the brink of eviction.
“Students rely on their financial aid to stay afloat while they pursue their goals–and La’ James pulled that out from under them,” said Student Defense Litigation Director Eric Rothschild. “When for-profit colleges engage in such practices, hard-working students pay the price. This settlement provides restitution for the students, accountability for La’ James, and a warning to other college executives not to engage in similar conduct.”
In 2014, the Iowa Attorney General’s Office brought an enforcement action against La’ James. In a 2016 settlement, La’ James agreed to forgive almost $2.2 million in student debt and was placed under monitoring for compliance with the settlement. The school was also prohibited from making false statements concerning financial aid. A 2021 report found, however, that La’ James continued to mislead students about tuition costs. Student Defense built on those findings through this class-action lawsuit. In 2022, former Attorney General Miller entered a separate settlement with La’ James that also included institutional debt relief and new disclosures about financial aid to students.
La’ James was the subject of a 2018 investigation by the New York Times which highlighted how the school left graduates with low-paying jobs and debts they cannot afford to repay.
A full copy of the order approving the settlement can be found on the Student Defense website.