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College Cheating Scandal: Stanford Student Drops Out Of Class Action Lawsuit

SAN FRANCISCO (CBS SF) -- Just hours after filing a class action lawsuit in the wake of the massive college admissions scandal, one of the two Stanford students involved has dropped out of the legal action.

According to attorneys involved in the litigation, Erica Olsen -- a member of Stanford dance squad -- withdrew from the suit without explanation late Thursday morning.

Olsen had joined Kalea Woods in filing the suit, claiming their future Stanford degrees have been devalued by the scandal that has embroiled the Bay Area university. Six more plaintiffs -- made up of non-Stanford students and parents -- have been added to the suit after Olsen dropped out.

Woods claims in the lawsuit that she would not have initially applied to USC had she known that other unqualified students were being admitted to those schools fraudulently.

"Woods similarly was never informed that the process of admission at USC was an unfair, rigged process, in which parents could buy their way into the university through bribery and dishonest schemes," the lawsuit claims. "Had she known that the system at USC was warped and rigged by fraud, she would not have spent the money to apply to the school. She also did not receive what she paid for a fair admissions consideration process."

The suit also claims degrees from Stanford have been impacted by the taint of the scandal.

"Woods has also been damaged because she is a student at Stanford University, another one of the universities plagued by the fraud scandal," the suit claimed. "Her degree is now not worth as much as it was before, because prospective employers may now question whether she was admitted to the university on her own merits, versus having rich parents who were willing to bribe school officials."

The lawsuit does name Stanford among the defendants which also include USC, UCLA, the University of San Diego, University of Texas, Austin, Wake Forest, Yale, Georgetown and the alleged kingpin of the scandal William Rick Signer and his foundation.

Stanford released a statement regarding the lawsuit Thursday afternoon.

"We believe the lawsuit filed by the students against Stanford is without merit. We take the issues raised through the events of this week very seriously," the statement read. "While we continue to closely examine our policies and processes to see if improvements should be made, we stand behind the integrity of our admissions process."

Hollywood actresses Felicity Huffman and Lori Loughlin, Stanford University's head sailing coach and a number of wealthy Bay Area parents were among dozens of people named in a sweeping nation-wide admissions bribery case unsealed in Boston federal court on Tuesday.

According to the criminal complaint released on Tuesday, the scheme began in 2011 and is the largest case of its kind ever filed by the U.S. Justice Department. The case was deemed "Operation Varsity Blues" by prosecutors.

This combination of pictures created on March 12, 2019 shows US actress Felicity Huffman(L) attending the Showtime Emmy Eve Nominees Celebration in Los Angeles on September 16, 2018 and actress Lori Loughlin arriving at the People's Choice Awards 2017 at Microsoft Theater in Los Angeles, California, on January 18, 2017. (LISA O'CONNOR,TOMMASO BODDI/AFP/Getty Images)

Singer, who ran a college counseling and preparation firm, is accused of being the ringleader of the fraudulent scheme, later becoming a cooperating witness. Also among those charged are a number of Bay Area executives, CEO and entrepreneurs.

One of the Bay Area defendants, Bill McGlashan, has been put on indefinite leave by private equity firm TPG. McGlashan is founder and Managing Partner of TPG Growth.

Two other Bay Area defendants, Palo Alto-based Hercules Capital CEO Manuel Henriquez and his wife Elizabeth, appeared in Manhattan federal court Tuesday after being arrested in New York. Manuel Henriquez shook his head repeatedly in court and Elizabeth Henriquez appeared distressed, repeatedly running her hands through her hair. The two were released on $500,000 bail each.

At a brief court appearance Wednesday, a judge allowed Loughlin to be released on $1 million bond and travel to the area around Vancouver, Canada, to work but otherwise imposed strict travel restrictions. Magistrate Judge Steven Kim said Loughlin must surrender her passport in December, inform the court of her travel plans and provide evidence of where she's been if asked.

Loughlin's lawyer Perry Viscounty declined comment outside the courtroom, where a day earlier her husband, fashion designer Mossimo Giannulli, was freed on similar terms.

Prosecutors allege the couple paid $500,000 to have their daughters labeled as crew-team recruits at the University of Southern California, even though neither is a rower.

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