UNC's unsuccessful race-based admissions fight cost $25 million
The University of North Carolina-Chapel Hill spent nearly $25 million to defend its race-based admissions policy over the past nine years in a lawsuit that went all the way to the U.S. Supreme Court.
The nation’s high court declared that policy unconstitutional this summer in a case that shifted federal law on affirmative action admissions across the country.
UNC has faced a number of legal battles in recent years, ranging from alleged racial discrimination and retaliation in its business school to a settlement to resolve potential legal action following the aborted hiring in 2021 of journalist Nikole Hannah-Jones. The university also spent more than $10 million for legal and public relations help related to an academic fraud scandal in the 2010s.
The figures related to the Supreme Court admissions case provide further insight into the financial impact of high-profile cases on public universities. They also are the source of subsequent consternation about the costs among current UNC leaders — none of whom were in place when the decision was made to fight the lawsuit and select attorneys.
UNC revealed costs from the case in response to a WRAL News public records request. The figures provide insight into the financial impact of high-profile cases, and reveal subsequent consternation about the costs among current university leaders — none of whom were in place when the decision was made to fight the lawsuit and select attorneys.
Board of Trustees Chairman David Boliek said it’s expensive to litigate nationally relevant legal issues. “Once you’re in, you’re in,” he said.
Boliek complained that none of the dozens of outside groups that filed briefs in support of UNC’s position offered to help with the university’s legal bills, even though universities across the country had similar admissions policies.
“We got stuck with the bill,” said Boliek, who was chairman of the Board of Trustees for about four years until members elected new leadership on Sept. 7. “And, yes, it was too much money.”
Most of the money went to an international law firm whose top attorneys billed UNC nearly $1,000 an hour. Skadden, Arps, Meagher & Flom charged the university approximately $18.2 million to shepherd the case through a voluminous discovery process and a federal district court trial, though the state Attorney General’s Office handled last year’s Supreme Court arguments free of charge.
The rest of the $24.5 million that UNC spent on the case went to consultants and expert witnesses, including $4.29 million for Cornerstone Research, a firm that specializes in witness preparation.
None of these figures include internal costs for time spent by the university’s 19-person general counsel’s office, or time the state attorney general’s office put in, all of which was significant. When the Attorney General’s Office took over the case in late 2020, that drastically reduced outside-counsel costs — so much that Skadden’s legal billings amounted to about $2,000 this year.
A spokeswoman for Attorney General Josh Stein said the office didn’t track the time its lawyers spent on the case, but two office lawyers worked with Skadden on the suit while it was in federal district court. That increased to eight attorneys while the case was before the U.S. Supreme Court. Altogether it amounted to thousands of hours, spokeswoman Nazneen Ahmed said in an email.
The lawsuit was filed in 2014, and Harvard University defended a similar case on roughly the same timetable. Because Harvard is a private institution it’s total legal costs are harder to come by, but in recent court filings the university said it spent more than $25 million.
UNC and Harvard were both part of the same Supreme Court decision because their cases were joined during the legal process.
Both universities far outspent the group that sued them, Students for Fair Admissions, a nonprofit organization created to raise money for the two lawsuits. Edward Blum, the group’s founder, said the group spent less than $8 million total, though the group’s lawyers — particularly in the Harvard case — often worked for free.
The actual cost “clearly dramatically exceeded” $8 million, Blum said.
Real costs may become clear soon. Blum said his legal team will try to force UNC and Harvard to cover at least some of these costs now that the case is over.
“So UNC and Harvard are going to be presented with bills,” Blum said. “I’m sure very detailed bills about how much time the lawyers spent on this.”
UNC’s leadership defended its costs in a losing effort and said its internal legal staff worked in recent years to contain those costs, paying Skadden — one of the country’s largest and best known law firms — a discounted rate.
Firm partners billed the university $990 per hour, UNC spokeswoman Kate Maroney said in an email. Skadden associates billed the university a minimum of $450 an hour and a maximum of $895 an hour starting in 2018, when a cap was instituted.
Skadden representatives didn’t respond to WRAL News requests for comment. Maroney said the firm implemented a number of cost-saving measures at the university’s request. The firm typically didn’t invoice the university for its lawyers’ travel time, for instance, and it used summer associates to research litigation issues for free, Maroney said.
A spokesperson for Cornerstone Research said the firm had no comment on its billings.
Maroney said none of the money spent came from state funds or tuition dollars, but she declined to clarify whether that means donors covered the entire cost.
“Through the years, our legal teams defended our processes and were successful in federal court until the issue finally came to the U.S. Supreme Court, where the law was changed for every university in the nation,” Maroney said. “We did not choose to be at the center of this case, but throughout we had confidence in our admissions process and the talented and expert team that oversees it.”
Although UNC Chancellor Kevin Guskiewicz's administration has defended the spending, there is some buyer’s remorse on campus. Boliek said the current Board of Trustees may have evaluated the case differently, but once it began the university was “kind of stuck.”
Two key UNC leaders from 2014, when decisions were made about legal representation, declined to answer WRAL News questions. Then-Chancellor Carol Folt, now president of the University of Southern California, didn’t respond to an interview request sent through USC’s media office. Lowry Caudill, who chaired the UNC Board of Trustees at the time, referred questions to the current chancellor and UNC Board of Trustees.
Some trustees expected the defense to cost more than the $24.5 million total. During a recent meeting Trustee John Preyer estimated the cost at $35 million. He told WRAL News last month that he loosely extrapolated the figure based on billing totals that were several years old.
“To the credit of the legal team, they have kept it around $25 million,” said Preyer, who was named the board chairman on Sept. 7.
The James G. Martin Center for Academic Renewal, a right-leaning think tank focused on higher education, said the university “wasted a good deal of money defending itself against this lawsuit.”
“If the purpose of the expenditure was to increase diversity on campus, it would have been much better spent on need-based aid,” center spokeswoman Jenna Robinson said in an email.
