Dive Brief:
- Corinthian Colleges Inc. listed hundreds of millions of dollars in debt on its bankruptcy filings this week and less than $20 million in assets, leaving little for creditors.
- The New York Times reports that for students suing the company to get any money out of it, its assets will have to garner more than $100 million because Corinthian’s secured creditors will get first dibs.
- A key element of the for-profit business model is spending little on the construction of new campuses, according to the article, which doesn’t leave much to sell off in bankruptcy proceedings.
Dive Insight:
Several groups of students are suing Corinthian Colleges, arguing they were duped into a poor, over-priced education. According to reporting by MarketWatch, at least one group of students is trying to file in bankruptcy court in hopes of remaining a party to the proceedings and getting a cut of the company’s divided assets. Again, though, that won’t be likely because regardless of the outcome of their case, students won’t be at the front of the line of those waiting to collect.