Corinthian Colleges Sues State Over Data Souight in Probe

Corinthian Colleges Inc. (COCO), an operator of for-profit schools, sued Illinois Attorney General Lisa Madigan seeking a state-court order shielding its confidential data while she investigates its practices.

Madigan, a Democrat, has been investigating for-profit schools for evidence they misled enrollees about post-graduation career prospects.

The company, based in Santa Ana, California, said she has asked for employee compensation data, internal policy, training and marketing manuals, strategic planning documents, personal information on ex-students and other data.

“The school desires to cooperate with defendant and at the same time protect its valuable confidential and proprietary information from disclosure to third parties and competitors,” Corinthian said in a complaint filed yesterday in Chicago.

Corinthian operates more than 100 schools in the U.S. and Canada, including Everest College, Heald College and WyoTech, with an enrollment of 96,000 students, according to its website.

Claiming the attorney general’s procedures violate Illinois’s Trade Secrets Act, the company asked for a court finding that her treatment of confidential business records is invalid, an order barring those practices, and an order directing Madigan to protect the company’s data.

The company has been unable to negotiate an agreement with the attorney general, according to its complaint.

A spokeswoman for Madigan, Maura Possley, said in a phone interview that the attorney general’s office is reviewing Corinthian’s student recruitment practices. She declined to comment on the company’s court filing.

The attorney general sued Alta Colleges Inc. in January for allegedly violating state consumer fraud laws.

The case is Corinthian Colleges Inc. v. Illinois Attorney General, 12-CH-23872, Cook County, Illinois, Circuit Court, Chancery Division (Chicago).

To contact the reporter on this story: Andrew Harris in Chicago at aharris16@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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