Update: Western Culinary Inst. Career Education Corp. class action moves forward

Recently, Multnomah County Circuit Court Judge Richard Baldwin signed this order (pdf) certifying an Oregon consumer fraud class action against Western Culinary Institute and Career Education Corp. It took us a while to get to an order. That’s not unusual in class action cases.

There is a quiet feature to his ruling that has an important impact on the case. Judge Baldwin refused Western Culinary Institute and Career Education Corp’s request to allow an immediate appeal of his decision.

That’s important for class members because each appeal can add years to the life of a case.  Judge Baldwin also ordered the parties to present a proposed notice plan, so the next step on the case should be notice to the class.

It’s good news for Western Culinary Institute alums who are drowning in debt.  For our part, it’s a great day. Brian Campf and I continue to push forward. It’s been a long road. There is still far to go. Onward.

If you attended WCI (now known as Le Cordon Bleu Portland) on or after March 2006, and you haven’t been in touch, feel free to use the contact information to connect. We can answer questions about the status of the case and also get you into our tracking system.

David Sugerman

15 thoughts on “Update: Western Culinary Inst. Career Education Corp. class action moves forward

  1. i apologize about not getting in contact with you last time i had some recent issues that had to be sorted through is there a way we could talk i was a student of wci /lcb

  2. Yes. Please contact us privately. You can phone at 503.228.6474 or hit my email: daviddavidsugerman.com

  3. Just wondering how the recent supreme court decision to strip American consumers of any protections affects the Le Cordon Bleu suit. I can hear pigs in the distance, squealing in triumph…

  4. Josh-
    Great question. In case you missed it, here’s my take on that ruling. Based on the specific facts and procedural position of this case, it is clear that the ruling will not apply. But there are likely to be some pending consumer cases affected. Once corporations use the magic language in their contracts, there will be no future consumer class actions, unless Congress amends the Federal Arbitration Act. Not a pretty thought. And, yeah, I hear that noise off in the distance, too.
    David

  5. Here is another news article about resistance to student loan debt collections. It is based on similar allegations about another private for profit trade school, misleading students about job placement probabilities. It may be of some help to you, andmay contain or lead to some useful precedents for the WCI class action.

    Always appreciate your help, even if progress is agonizingly slow.
    Thanks,
    Jameela

  6. It’s been a looooooong time since any news about status of the WCI case. Anything you can tell us?

    Thanks,
    Jameela

  7. There are actually some later brief updates on our Facebook page, but the reason for no updates is that there is no news. Here is the most recent update on the blog: http://www.davidsugerman.com/2013/07/15/update-answering-brief-filed-in-cec/

    We filed our brief on the arbitration issue in the Oregon Court of Appeals in July of 2013, more than two years ago. The Court of Appeals heard oral argument in May 2014, and still has not issued a decision. We cannot move the case forward until we finish on their appeals. These delays have been very difficult for everyone.

  8. David: Your comments about this would be welcome — A senior official in the Oregon Attorney General’s Office recently suggested to me that they would accept specific complaints from former students of WCI/ LeCBPortland. Perhaps such consumer complaints to the A-G would result in their being included in the current multi-state Attorney Generals’ negotiations and possible settlement with WCI and its parent, Career Education Corporation. I believe that this has a chance of resolution favorable to members of your student class, whether or not their agreements included arbitration clauses, if it results in a settlement similar to the one the Oregon A-G announced not long ago for student loans of EDMC…particularly if it includes students who borrowed from Sallie Mae / Navient, etc., under the “arrangements” set up by WCI.

  9. i would like to be more involved in this. i attended WCI in 2009 and just read that all Le cordon bleu schools are closing. what does this mean for the case?

  10. Hi Larry-
    Sorry for the delay in responding–I have been out of town. We welcome DOJ support, but I don’t think this is the place to discuss the specifics.

  11. Hi, David,

    Thanks for responding. I will be in touch with you later if I find out anything helpful re the Oregon Department of Justice.

    Also, it will be helpful if either you or Mr. Vigil [email 12-16-15] can relate any specifics about what he read about Le Cordon Bleu schools closing, where, when etc. CEC announced about a year ago that they had put those schools up for sale, but last I learned there were no serious buyers.

    Incidentally, I am one of those who closed my Facebook account earlier this year because of Facebook’s failure to control hackers, viruses, etc. adequately, so whatever additional information you can provide on this stream from time to time will help.

    — Happy Holidays. And best possible luck for success for you and the students in their plaintiffs’ class action in this long-delayed case [due 100% to WCI-Le Cordon Bleu and Career Education Corporation’s obfuscations and continuing deceits, of course].

  12. To David Sugerman, Thomas Vigil and all readers: Just located online a Career Education Corporation press release, dated December 16, 2015, announcing what CEC calls a “teach-out”– i.e. gradual closing predicted by them to be completed by September, 2017, of all their 16 or so “Le Cordon Bleu” cooking schools, including the formerly-named Western Culinary Institute in Portland. The same release discloses an extension of a CEC $95 million credit agreement with BMO Harris Bank through 2018. This release is available publicly at — http://www.careered.com/Investor Relations/News Releases.

  13. The link to the press release in Larry Wick’s Dec 20 comment doesn’t seem to work. I think I found the newsbit he was describing, you can see it here
    http://www.snl.com/IRWebLinkX/file.aspx?IID=4081441&FID=32269139

    A related link, aimed at non-investors, is here
    http://www.careered.com/press-room/press-releases/career-education-corporation/career-education-announces-intent-to-divest-le-cordon-bleu-colleges-of-culinary-arts

    My guess is that this new direction for WCI will have no impact on the progress or the outcome of the class action, since the parent company will remain a viable entity and share the ultimate liability. It would be in their best interest to continue delaying and prolonging as they have been. But that’s my opinion. It would be nice to get a fresh perspective from Mr. Sugarman.

    Thanks,
    Jameela

  14. The shutdown of the culinary division fully confirms our claims that the school was fraudulently selling its program. We continue to watch the developments but remain on hold while CEC’s court delay tactics drag on. We remain fully committed to the case and look forward to the day when we can tell this story of fraud and greed to an Oregon jury.

    -David

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