Federal Judge Grants Permanent Injunction Request to Stop XAP from Misleading
Students on Its Mentor College Admission Sites
PORTLAND, Ore., April 21 /PRNewswire/ -- Citing the continuing use of
deceptive language on so-called "Mentor" websites operated by XAP Corporation
of Los Angeles on behalf of FFEL lenders affiliated with Kentucky Higher
Education Assistance Authority and the Georgia Student Finance Commission,
federal judge Anna Brown agreed to order a clean-up of language presented to
students. The judge stated that "On this record, the Court concludes
Defendant's [XAP's] revisions to its online application process continue to be
inadequate because they fail to convey in clear and unequivocal language that
when they check the 'Yes' box, students are giving 'express consent and
direction' to Defendant to provide their personal information to third parties
who have paid a fee to Defendant in part for their right to receive that
information."
(Logo: http://www.newscom.com/cgi-bin/prnh/19990810/NYFNSP04)
The judge stated that "Although Defendant asserts it no longer sells
student information, KHEAA contracted to pay Defendant $378,216 in 2006 for
the 'purpose of maintaining and operating the [website].' In 2004 GSFC
contracted to pay Defendant an annual fee of $217,718.45 with rates to be
increased each year thereafter to operate and to maintain its website.
Accordingly, those universities and colleges within the aegis of KHEAA and
GSFC continue to reap the benefit of Defendant's online application process
free of charge whereas they would have to pay Plaintiff a fee to obtain
similar services."
Judge Brown continued: "The Court agrees with Plaintiff that it continues
to suffer irreparable harm by remaining at a competitive disadvantage to
Defendant as to online application systems used by Defendant that do not
adequately disclose to students that they are authorizing Defendant to provide
their personal information to third parties such as KHEAA and GSFC if the
students answer 'Yes' to the opt-in question on Defendant's websites that are
sponsored by KHEAA and GSFC."
Citing the public interest, Judge Brown noted that "The Court concludes it
is in the public interest for students to be made aware unequivocally of the
consequences of checking the 'Yes' box on Defendant's opt-in question by
conspicuous language at the point where the opt-in question appears."
The full text of the Judge's Opinion and Order is available at
http://corp.collegenet.com/news/pr_04_21_08.pdf
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