Corporate Misconduct Case Study: Ejudicate, Inc. and Its Impact on Indebted Students

The Human Story: Ambushed by a Court You Never Agreed To

Imagine trying to build a better life. You enroll in a training program, signing an “Income Share Agreement” (ISA)—a type of loan—to finance your education. You believe this is your path forward. Then, one day, you receive a “Notice of Arbitration.” A company you’ve never heard of, Ejudicate, Inc., claims you are now part of a “formal and binding” legal process.

You are labeled a “Defendant.” A “Plaintiff” has filed a “legal claim against” you. The notice warns that “failure to respond may result in a court judgment against you.” Stunned, you try to see the details of this supposed claim, which could be for as much as $30,000.

But there’s a catch. To view the file, you must first click “agree” to Ejudicate’s terms of service. Buried in those terms is a clause stating that by agreeing, you surrender your right to object to their authority.

This was the trap set for 68 students. They were pulled into a parallel legal system they never consented to, one created not for justice, but for streamlined, profitable debt collection.

The Corporate Playbook: How the Harm Was Done

Ejudicate (now doing business as Brief), operated an online dispute platform. They partnered with a group called the “Prehired Entities.” Prehired sold vocational training financed by ISAs and had created these other entities specifically to collect on defaulted student accounts.

Here is the strategy Ejudicate engineered, according to the Consumer Financial Protection Bureau (CFPB):

1. Knowledge of Illegitimacy: Ejudicate reviewed the students’ original ISA contracts before starting the process. They knew full well that none of the contracts named Ejudicate as an arbitrator. In fact, many contracts explicitly named legitimate forums like New York state courts or the American Arbitration Association as the proper venue for disputes.
2. Manufacturing a Pretext: Instead of rejecting the cases due to a clear lack of jurisdiction, Ejudicate advised Prehired on how to create a legal fiction. They counseled Prehired to unilaterally modify its company-wide Terms of Service to insert a new rule: all disputes must be handled through Ejudicate. This change was made without the students’ consent and, in many cases, violated clauses in their original contracts that required mutual written consent for any modifications.
3. Springing the Trap: With this manufactured pretext in place, Ejudicate and Prehired began filing arbitration claims against the 68 students in April 2022. They sent out official-looking “Notices of Arbitration” designed to intimidate consumers into participating in a process they had no legal obligation to join.
4. Coercing Consent: The masterstroke of the scheme was forcing students to “agree” to Ejudicate’s authority just to see the case against them. Ejudicate refused to provide the claim documents to at least one student who rightfully declined to accept the terms, trapping them in a classic catch-22: either surrender your rights or remain ignorant of the bogus charges against you.

A Cascade of Consequences: The Real-World Impact

The harm caused by this predatory playbook was not theoretical. It was a direct assault on the financial stability and basic rights of dozens of people.

Economic Ruin

The primary goal was wealth extraction. Each of the 68 students faced claims that could ruin them financially.

This “contested” fee is particularly predatory. A student was deemed to have “contested” the claim simply by logging into Ejudicate’s platform—the very action required to see the case against them. They were charged hundreds of dollars for attempting to defend themselves in a forum they were forced into.

A Rigged and Biased System

Ejudicate aggressively marketed itself to the public as a “neutral and unbiased” forum whose decisions were “legally binding and enforceable.” This was a calculated deception. Ejudicate’s financial interests were completely aligned with the creditor, Prehired.

The company’s contract with Prehired included a “Resolution Success Fee”—a 15% contingency fee on any money recovered from a student through a settlement. This structure gave Ejudicate a direct financial incentive to ensure Prehired won. They weren’t a neutral arbiter; they were a partner in collection.

Their services went far beyond just hosting a platform. Ejudicate actively assisted its client by:

• Advising on evidence submitted by Prehired.
• Providing a “Claim Implementation and Timeline” to streamline the process of arbitrating against the students.
• Introducing Prehired to a law firm to help turn their sham arbitration awards into legally enforceable court judgments.

Despite what it appeared to be, this wasn’t a court. It was in fact, a factory for processing debt claims, with the scales of justice deliberately tipped in favor of the corporation.

Analysis: A System Designed for This

Ejudicate’s actions are not those of a single rogue company. They are the logical product of a neoliberal economic system that relentlessly seeks to privatize public functions—including justice—and turn them into revenue streams.

This case is a stark illustration of late-stage capitalism’s core tenets in action:

• Deregulation as a Feature: The rise of a sprawling, confusing, and largely unregulated private arbitration industry creates the perfect environment for predatory models like Ejudicate’s to flourish. It operates in the shadows of the public court system, free from its rules of evidence, transparency, and due process.
• Profit Over People: The system Ejudicate built was not designed to determine truth or deliver justice. It was designed for efficiency and profit. Every rule, from the coercive terms of service to the contingency fee, was optimized to extract wealth from indebted students and deliver it to their corporate client.
• Information Asymmetry as a Weapon: The entire scheme relied on the power imbalance between a corporation with legal counsel and an individual consumer. The intimidating, legalistic language and the complex digital interface were designed to confuse and coerce people into surrendering their rights without a fight.

This is the predictable outcome of an ideology that insists the market can solve all problems. When justice becomes a commodity, it will inevitably be sold to the highest bidder.

Dodging Accountability: The Illusion of Justice

After the Delaware Attorney General intervened, the scheme unraveled. The result was this Consent Order with the CFPB. But any sense of victory for consumers vanishes upon reading the terms.

Ejudicate was ordered to pay a civil money penalty of one single dollar.

The document notes this amount is based on the company’s “sworn and documented inability to pay.” While the order contains a provision to charge $250,000 if it’s found Ejudicate lied about its finances, the initial penalty stands as a mockery of accountability. It is not a deterrent; it is a rounding error, a cost of doing business so low it’s insulting.

Crucially, the settlement allows Ejudicate to avoid admitting or denying any wrongdoing. This is a standard feature of consent orders that allows corporations to escape the public relations fallout and legal precedent of a guilty verdict. No executives are named or held financially responsible. The corporation, as an abstract entity, takes a meaningless slap on the wrist, and the individuals who designed and profited from the scheme face no personal consequences.

Reclaiming Power: Pathways to Real Change

This story proves that consumer protection laws and regulatory agencies, while essential, are not enough to combat systems designed for exploitation. Meaningful change requires dismantling the structures that allow such predatory behavior to thrive.

• Ban Forced Arbitration: The most direct solution is to eliminate forced arbitration clauses in all consumer and employment contracts. All citizens deserve their day in a public court, not a private, for-profit forum rigged against them.
• Strengthen Public Systems: Instead of allowing justice to be privatized, we must reinvest in our public court system, ensuring it is accessible, affordable, and efficient for all. This includes robust funding for legal aid services to help level the playing field between individuals and corporations.
• Real Executive Accountability: Corporate penalties must be paired with meaningful, personal consequences for the executives who oversee and direct illegal schemes. This includes substantial individual fines and, where appropriate, criminal charges. A system that only ever punishes a corporate entity is a system that protects the powerful.

Conclusion: A Story of a System, Not an Exception

The story of Ejudicate, Inc. is window into the soul of our modern economy. It reveals a system where debt is weaponized, justice is commodified, and accountability is for sale. The complex legal document that details this case is not just a record of one company’s misdeeds; it is a blueprint of a predatory capitalism that views human beings as resources to be squeezed.

The villains here are not just a few individuals in a boardroom. The ultimate villain is a political and economic system that told them this was a viable business model in the first place—a system that rewards the extraction of wealth over the protection of its people. Until we change that system, there will always be another Ejudicate waiting in the wings.

Disclaimer: All factual claims in this article related to the Ejudicate, Inc. case are derived from the public Consent Order (File No. 2024-CFPB-0010) issued by the Consumer Financial Protection Bureau on October 10, 2024.

Ejudicate (presumably pronounced adjudicate) has since rebranded changed its name to Brief, and their website is: https://www.thinkbrief.com

sauces used to make this ravioli:

https://www.consumerfinance.gov/about-us/newsroom/cfpb-takes-action-against-arbitration-platform-ejudicate-for-deceiving-student-borrowers

https://files.consumerfinance.gov/f/documents/cfpb_ejudicate-inc-consent-order_2024-10.pdf