December 8, 2011

Statement of Bonnie Campbell on Behalf of Education Management Corporation

The U.S. government yesterday filed its response to Education Management Corporation's ("EDMC") Motion to Dismiss in the case of United States of America, ex rel. Lynntoya Washington, et al. v. Education Management Corp., et al. Bonnie Campbell is a former Iowa state attorney general and former U.S. Department of Justice official who was also a member of the Iowa Board of Regents, the governing body for the state's universities and special schools. The following may be attributed to Ms. Campbell in her role as advisor and spokesperson for EDMC's legal counsel:

"We are reviewing the governments' responses to EDMC's motion to have the Court dismiss this lawsuit, and we will have an opportunity to file a reply with the Court. Based on what we have seen, we continue to believe the case should be dismissed with prejudice because the government's False Claims Act and common law claims are legally flawed and factually insufficient.

"The narrow legal issue in this case is whether the sole basis for EDMC's compensation of admissions officers was enrollment numbers. Federal regulations issued in 2002 expressly permitted companies to consider enrollment numbers when determining admission officer salaries, as long as compensation was not based solely on enrollment numbers. Federal law allowed EDMC to recruit students and to encourage its admissions officers to recruit.

"As EDMC's brief in support of our Motion to Dismiss describes in detail, the Company's compensation plan complied with the law by requiring the consideration of five quality factors, seniority, administrative responsibilities and geographic location along with enrollments to determine salaries. And, the government admits that admissions officer compensation was set using a matrix that required consideration of the quality factors. Its own exhibits demonstrate that EDMC disseminated guidelines for proper use of the compensation plan to managers, instructed them to ensure it was administered effectively, and trained its admissions officers in the plan."

About Education Management
Education Management Corporation (www.edmc.edu) is among the largest providers of private post-secondary education in North America, based on student enrollment and revenue, with a total of 106 locations in 32 U.S. states and Canada. We offer academic programs to our students through campus-based and online curriculum instruction, or a combination of both. We are committed to offering quality academic programs and continuously strive to improve the learning experience for our students. Our educational institutions offer students the opportunity to earn undergraduate and graduate degrees and certain specialized non-degree diplomas in a broad range of disciplines, including design, media arts, health sciences, psychology and behavioral sciences, culinary, fashion, business, education, legal and information technology.

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