Law Grad in Pink is a blog written by a law graduate in Adelaide for law graduates everywhere.

Wednesday 16 March 2016

Law graduate who can’t find full time legal job sues law school - Is the United States trend of law graduate law suits about to come to Australia?

In the United States, disgruntled law graduates who have been unable to secure legal jobs have been bringing claims against their law schools under state consumer laws, which vary from state to state. Anna Alaburda’s case against the Thomas Jefferson School of Law (TJSL) which is currently before the San Diego Supreme Court could be more successful than other cases, as the consumer laws in California are believed to be more favourable to consumers than consumer laws in other states. Australian law graduates have been facing similar challenges to their American counterparts, with an increase in the number of law students graduating and a sluggish legal recruitment market creating an increasingly desperate situation. Could the trend of law graduates suing their law schools spread to Australia?

Previous cases in the United States
There have been a number of previous cases in the United States where law students have claimed their law school provided misleading statements on employment prospects for their law graduates. In the 2012 New York Supreme Court case of Alexandra Gimez-Jiminaz, et al v New York Law School, nine graduates of New York Law School brought a case claiming the entering classes of 2005-2010 had been misled as by graduate outcome statistics provided by NYLS, as facts were omitted that would have given prospective students a more accurate picture of post-graduation employment prospects. The 90% employment outcome advertised included graduates working in part time jobs and those working in jobs that did not required law degrees. The damages sought were the sum equal to “the difference between the alleged inflated tuition they paid because of the allegedly misleading statements and what they characterise as the “true value” of a NYLS degree, together with certain expenses incurred”. Many of the plaintiffs had successfully started their legal careers, including:
1.       Alexandra Gomez-Jimenez who had her own thriving immigration practice;
2.       Scott Tiedke who worked as a legal compliance officer at an investment management firm;
3.       Gergana Miteva who worked as a contract attorney for some time before finding full time legal employment; and
4.       Geoffrey Corsideo who worked at a New Jersey law firm.

Justice Schweitzer dismissed the case, citing the legal principle caveat emptor “buyer beware”, and that prospective law students are “are a sophisticated subset of education consumers, capable of sifting through data and weighing alternatives before making a decision regarding their post college options”.

Anna Alaburda’s Case
Anna Alaburda is a 37 year old TJSL graduate who completed her three year Juris Doctor in 2008 and had a student debt of about $150,000 on graduation. Alaburda struggled to find full time employment as a lawyer and felt misled by the employment prospect figures she claimed were decisive to her enrolling in the JD program at TJSL. In 2011 she filed her initiating application, claiming the TJSL statistics about alumni employment outcomes were misleading and had been inflated and that she would not have studied the JD at TJSL if she had known the true statistics. The matter took until 7 March 2016 to get to the San Diego Superior Court, as the law school made a number of applications to have the matter dismissed. Alaburda, who is currently 37 years old, has a student loan debt of about $170,000, as the interest rate on the loan is 8%.

What is the real issue?
While we can all feel sorry for Alaburda and her colleagues, the law suit distracts from the real issues. First, there needs to be some degree of personal responsibility, as people are not forced to enrol in postgraduate law. Second, there is currently a large surplus of universities offering undergraduate law and postgraduate law courses, and the quality of many of these courses is questionable. Steps need to be taken to prevent even more surplus positions at law schools becoming available and to ensure all law schools offer a quality education.

1.       Ranking and reputations of law schools
The first thing to note about Alaburda’s case is her choice of law school. TJSL ranks extremely poorly in comparison to other universities offering the JD course in the United States. The law school rankings given to TJSL are so poor that the US News Law Ranking system do not publish the rankings for TSJL and a number of other poorly performing universities (presumable to protect themselves from defamation claims). Students are aware of the ranking and reputation of their law school prior to enrolling. Students studying law are also aware that it is difficult to get a job as a lawyer and that not all graduates work as lawyers after completing their JD. Getting a job as a graduate lawyer in the United States is difficult and employment rates are far from 100%. For example in 2014, 40% of law graduates across the United States did not secure a job in the law within 12 months of graduation. While this would include graduates who do not wish to practice law, this 40% would also include a large number of graduates who want a legal career.

Similar cases to Ms Alaburda’s never made it to trial in states like Illinois and Michigan as the judges managing the cases in those states concluded law students chose to have a legal education at their own risk. Alaburda would have been aware of the difficulties of obtaining employment in the law prior to starting her JD. While Alaburda had solid grades and graduated near the top of her class, even top students would struggle to get a job after attending a law school with such a low ranking reputation. Further, while Alaburda has yet to find a full time job in the law, she failed to make the most of opportunities that arose.

2.       Not taking opportunities
On graduation, Alaburda sent her resume to 150 law firms. This is not out of the ordinary for a law graduate given the state of the legal market, though other students take the approach of quality over quantity of applications. She received several interviews and one job offer. This is more success than a number of law graduates have. She turned down the legal job as the salary ($60,000) was less than for non-legal jobs she had applied for. To me, this is a clear case of a graduate choosing a non-legal path. I have no sympathy, and neither should the courts, for law graduates who turn down an offer other law graduates would do anything for, and then later claim they could not get a legal job. The starting salary for law graduates can be relatively low, as a law graduate must be trained before they become self-sufficient and useful. Salaries quickly rise for competent graduates.  Alaburda later worked in a series of part time, temporary legal positions mainly reviewing documents for law firms, found this work unsatisfactory, could not get a full time position and filed an initiating application against TJSJ.

3.       Realities of working as a junior lawyer  
It is not unusual for junior lawyers to do copious amount of document review, discovery and due diligence related work as graduates. The reality of working as a junior lawyer is that most of the work will be less than exciting, especially when working at a large law firm, but quickly becomes more engaging as you are trusted with more complicated legal work and the next generation of graduates take on the more boring work. Alaburda had a series of part-time document review roles and found this boring. However, this kind of work is the reality for most law graduates.

Will the trend of law graduates suing their law schools spread to come to Australia?
Many of the factors leading to law graduate law suits in the United States are currently present in the Australian legal market:

1.       Increasing number of law schools offering sub-par courses
The number of law schools offering undergraduate and postgraduate law has increased significantly in the past 10 years. In NSW alone, the following law courses were accredited:

·         JD at the University of Sydney (2010);
·         JD at the University of NSW (2009);
·         JD at the University of Technology Sydney (2007);
·         JD at the University of New England (2005);
·         JD at the University of Newcastle (2013);
·         JD at the University of Notre Dame (2006);
·         LLB at the University of Notre Dame (2005);
·         LLB at the Australian Catholic University (2013); and
·         LLB at the Top Education Institute (2014).

The pattern in other states is similar. Law schools are easy to establish and tend to be high profit earners for universities, as they are low cost compared to other degrees. It is not just the increase in educational institutions offering law courses that is problematic but the quality of the courses, especially given the significant expense of postgraduate courses in particular.

2.       Increasing number of law graduates
The increasing number of law schools and expanding of programs offered by existing law schools has created a large excess of law graduates. I personally have several issues with the number of law graduates churned out of law schools. However, growth in the number of law graduates is unlikely to change, as the Productivity Commission’s Review into Demand Driven Funding System recommended that law schools’ numbers not be limited.

3.       Increasingly competitive to get a job as a lawyer
At the same time the number of law graduates has increased, the legal markets has stagnated and large law firms that traditionally employed large numbers of graduates have either reduced or maintained the number of graduates they employ. New entrants into the legal market, such as LegalVision are offering new opportunities for graduates, but there is still a significant gap between law graduates wanting to work as lawyers and positions available.

However, there are a number of factors that might prevent the spread of law graduate law suits in Australia:
1.       Less financial pressure
Law graduates in the United States face significant pressure on graduation to begin paying off their $150,000 loans, which usually have an interest rate of 8%+. Australian students do not face the same pressures, as a Commonwealth supported undergraduate combined law student will graduate with a debt of about $50,000 which need only be repaid in increments once the student has graduated and is earning a significant amount of money. Australian graduates therefore do not face the same financial pressures as their counterparts in the United States and are more likely to be able to survive part time and paralegal work for some time before securing a full time legal position, not succumbing to the temptation to accept a higher paying non-legal job. In the United States, graduates face more pressure to get a high earning job immediately to pay off their loans, even if the job is non-legal.

2.       Less focus on graduate outcomes during student recruitment
Law schools in Australia are generally very careful with statistics regarding employment prospects. Students are normally lured via alumni success stories and a university’s reputation rather than a focus on statistics. There is also a lack of statistics on law graduate outcomes available. Graduate Careers Australia undertakes an annual survey of short term outcomes for graduates 4 months after completion of qualifications (http://www.graduatecareers.com.au/research/researchreports/gradstats/). These statistics are for all graduates and do not provide university by university data. A response of “full time employment” includes full time employment not related to the person’s degree. There is a breakdown by bachelor degree, and in 2015, 74.1% of law graduates who completed the survey were engaged in full time work at the time they completed the survey, about 4 months after the completion of their qualifications.   

3.       Difficulties bringing a claim under Australian consumer law
Even if a law graduate did wish to commence legal action, it would be very difficult to bring successful action under Schedule 2 to the Competition and Consumer Act 2010, as the lead possible cause of action being misleading or deceptive conduct (s.18 Australian Consumer Law) requires the conduct to be “likely to mislead or deceive”. The test requires the identification of the audience, in this case, relatively intelligent, well-educated persons considering enrolling in undergraduate or postgraduate law. It would be difficult to mislead or deceive this target audience, as potential law students would generally consider several law schools and be aware of the general reputation and quality of the law school. The test is objective, so the fact a student was actually mislead or deceived will not be determinative if the relevant population segment would not have been misled or deceived.


It is unlikely the trend of law graduate litigation will spread to Australia. However, if the number of law graduates continues to increase and the legal graduate market fails to improve, we could see law graduates take legal action against their law schools in the future. 

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