Screenshot of The InfiLaw System’s website.

For-profit law school operator InfiLaw Corp. has dodged a third whistleblower lawsuit claiming it defrauded the federal government and deceived students.

A federal judge in Florida on Monday dismissed a qui tam suit brought by two former employees of the now-closed Arizona Summit Law School that claimed, among other things, that InfiLaw administrators conspired with bar preparation outfit BarBri to make sure that the Phoenix law school was in compliance with a rule that no more than 90% of it funds were derived from federal student loans.

In a 58-page opinion, U.S. District Judge Marcia Morales Howard of the Middle District of Florida ruled that many of the plaintiffs’ claims of wrongdoing by InfiLaw and its three law schools were barred in court because they had already been disclosed in the media through articles and blog posts critical of the schools’ practices. Moreover, Howard found the allegations brought by Paula Lorona and Reid Potter to be too vague to overcome the defendants’ motions to dismiss.

“Whether the law schools published substantially misleading information regarding its bar passage rates depends entirely on what was said, when it was said, in what context, what was or was not disclosed about the Unlock Potential program, and the impact the program did or did not have on the bar passage statistics,” Howard wrote of an InfiLaw program in which the schools provided stipends to students who agreed to delay taking the bar exam for fear they would not pass. “None of this information is alleged in the third amended complaint.”

David Mills, a partner with Cooley who represented InfiLaw, did not respond to requests for comment on the decision Tuesday. Nor did Robert Mills, an attorney with the Phoenix firm Mills and Woods Law who represented the plaintiffs.

InfiLaw has prevailed in each of three whistleblower suits brought by former employees in recent years. Former Arizona Summit law professors Celia Rumann and Michael O’Connor, who were fired, voluntarily dismissed their qui tam suit in February 2018 after the government declined to intervene. And in November, another federal judge in Florida tossed former Charlotte School of Law professor Barbara Bernier’s whistleblower suit, also finding that her claims were too vague and too similar to the two previously filed suits. (The government also passed on joining Bernier’s suit.)

Arizona Summit closed in the fall of 2018, while Charlotte School of Law shuttered in the fall of 2017. InfiLaw’s remaining law school, Florida Coastal School of Law, is in the process of becoming an independent, nonprofit campus.

All three whistleblower suits included allegations that the InfiLaw campuses defrauded the federal government by admitting unqualified students in a bid collect their student loans. They also claim that the school’s violated the so-called 90/10 rule, which requires higher education institutions to derive no more than 90% of their revenue from federal student loans.

Lorona, a former Arizona Summit student and employee in its financial aid office, initially filed suit against Arizona Summit in 2015. Reid, another former student and employee in the bar preparation program at Arizona Summit, joined the suit the following year. But the U.S. government declined to intervene in February of 2018 and the plaintiffs pushed forward without it.

Among their myriad allegations is that InfiLaw school administrators devised an in-house bar preparation program in 2011 as a means to skirt the government’s 90/10 rule because they feared their reliance on federal loans would soon exceed that threshold. They claim that Arizona Summit partnered with BarBri to execute the program, but that students would pay the cost directly to Arizona Summit instead of BarBri. The school would then count that bar prep revenue towards the 10% of funds coming from outside the federal student loan program, the suit alleged. But the claims are too vague and do not assert that Arizona Summit actually crossed that 90% threshold, Howard wrote. Moreover, the revenue the plaintiffs claim was derived from the bar prep scheme is nowhere near enough to represent 10% of the Phoenix school’s revenue, the opinion says.

“[Plaintiffs] contend that the law schools were defrauding the federal government of student loan funds because they were engaged in conduct which rendered them ineligible to participate in the federal student loan programs,” Howard wrote. “However, the public disclosures exposed the very conduct which [plaintiffs] contend was disqualifying, namely, the Law Schools’ practice of admitting unqualified students, the likely inability of those students to pass the bar exam, the high cost of the Infilaw education, and the implications of Infilaw’s admissions practices with respect to the Law Schools’ bar passage rates and accreditation.”