National College must pay $157,000 in sanctions, Court of Appeals rules

Kentucky Attorney General Andy Beshear
Kentucky Attorney General Andy Beshear

National College of Kentucky will have to pay the state of Kentucky $157,000 in civil sanctions, the Kentucky Court of Appeals has ruled.

The ruling affirmed a previous order by Franklin Circuit Court, Attorney General Andy Beshear’s office announced Wednesday. It stems from the initial refusal of the for-profit National College, now operating as American National University Inc., to respond to a subpoena issued by the Office of Attorney General Jack Conway in 2010. The subpoena was issued during an investigation into potential violations of Kentucky’s Consumer Protection Act because Conway alleged that the college put false job placement claims for graduates on its website.

Instead of responding to the subpoena, National College tried to block the investigation by filing suit in Franklin Circuit Court, Beshear said. Franklin Circuit Court ruled that the attorney general’s investigation and subpoena were authorized, a ruling which was upheld by the Court of Appeals, but the matter was returned to the trial court to determine whether the scope of the subpoena was appropriate. After the case was returned to Franklin Circuit Court, National College still refused to respond to the subpoena, and the court imposed a $1,000-per-day penalty in December 2013.

“The ruling by the Court of Appeals is a win for every Kentucky student who has been misled by a for-profit school who cares more about profits than offering a quality education,” Beshear said. “My office will continue to fight for all Kentuckians as consumers but more importantly as students who want to better themselves and their families. This ruling sends a strong message that companies refusing to cooperate with consumer protection investigations will be held accountable when they engage in meritless delay tactics.”

Under Kentucky law, National College and its attorneys have 30 days to seek discretionary review by the Kentucky Supreme Court.

The attorney general’s office has a pending case against National College in Fayette Circuit Court alleging that National College violated the Kentucky Consumer Protection Act by advertising misleading employment rates for National College graduates. This litigation is currently set for trial in October.

National College has campuses in Danville, Florence, Lexington, Louisville, Pikeville and Richmond.

ANU officials were not immediately available for comment.

Linda Blackford: 859-231-1359, @lbblackford