Former ITT students seek status as creditors in college’s bankruptcy case

This is an archived article and the information in the article may be outdated. Please look at the time stamp on the story to see when it was last updated.

File image

CARMEL, Ind. – Former students want to be considered creditors in former for-profit college ITT Educational Services Inc.’s bankruptcy case.

According to court documents filed earlier this week, five students are asking that they and thousands of other students who attended ITT from 2006 through 2016 be legally recognized as creditors.

4 Fast Facts

  • Former ITT students request creditor status in school’s bankruptcy case
  • Carmel-based company closed 130 campuses on Sept. 6
  • Students say their student debt qualifies them as creditors
  • Five students filed the motion and seek class-action status for thousands of other students

The Carmel-based company closed its 130 campuses nationwide on Sept. 6 and filed for bankruptcy a week later. The case is still working its way through the court system.

The closure, which was the result of a federal crackdown that tightened regulations on for-profit colleges, affected more than 35,000 students and 8,000 employees.

“ITT students are the true creditors of ITT. They seek recognition as creditors in this bankruptcy, a fair apportionment of the remaining estate, and an adjudication of their claims that will clear the path to loan cancellation in collateral proceedings,” the filing said.

“Plaintiffs seek to represent a class of students who were enrolled in ITT programs between 2006 and 2016 and were harmed by ITT’s deceptive conduct, and breach of contractual obligations, including its breach of the implied covenant of good faith and fair dealing.”

The filing accused of ITT of building its business model around student debt and said it misrepresented job placement rates and salary expectations. Students in more than 30 states reported instances of inflated salaries, the filing said.

Notice: you are using an outdated browser. Microsoft does not recommend using IE as your default browser. Some features on this website, like video and images, might not work properly. For the best experience, please upgrade your browser.