
Pearsons, Who Pledged $100M to UChicago, Want Their Money Back - avree
https://www.chicagomaroon.com/article/2018/3/5/pearsons-want-100-million-back-from-univeristy-of-chicago/
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whack
One of the more ridiculous things from the article:

> _Apart from ensuring that the Institute had a world-class in-house faculty,
> the contract also mandated that the University host an annual “Pearson
> Global Forum” (PGF) that would convene leading conflict scholars and
> policymakers from around the world.

> The University, according to the suit, was obligated to hold the first PGF
> by October 31, 2018, but said that it could not host the event by then as
> “it had not planned or done the necessary preparatory work.” The Pearsons
> alleged that the University informed them that it would attempt to meet this
> obligation by that date by instead involving the Institute in the 2018 Irish
> Catholic Bishops’ World Meeting of Families Congress, an event which,
> according to its website, “brings together families from across the world to
> celebrate, pray and reflect upon the central importance of marriage and the
> family as the cornerstone of our lives, of society and of the Church.”_

~~~
root_crontab
It seems like there was a mismatch in expectations that goes to the heart of
how universities and philanthropy work.

The university thought it was getting a donation, along with some vanity
conditions, comparable to naming a building or a chair, which it could fudge
while spending the money on whatever it wanted.

The foundation thought it was paying the university to carry out something
very specific on its behalf.

~~~
frandroid
> The university thought it was getting a donation, along with some vanity
> conditions, comparable to naming a building or a chair, which it could fudge
> while spending the money on whatever it wanted.

I think it's clear that the conditions were more than vanity, and were
actually qualitative.

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dahdum
From reading the article, doesn't seem like UChicago was very interested in
actually running the institute as much as sticking it with operating expenses
and doing the bare minimum.

I'm sure more will come out - this will be an interesting lawsuit.

~~~
tomkat0789
Yep. In grad school, the university took like 50% of the funds for our
project, probably to plug budget gaps. I agree with the first comment:

"Relying on a university administration is generally not prudent. It is clear
that the Family envisioned an effective "new business," in the spirit of a
venture or a "start-up" and those kinds of projects take serious business
execution. In my experience, the Pearson's complaint merely exposes the tip of
the iceberg as far as what the donor "sausage machine" looks like in a major
university. Lesson? Donors need to act more like active investors, despite the
general hard resistance universities put up."

They were expecting university administrators to provide "serious business
execution".

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dsacco
Can someone clarify this for me?

 _> A few days before Robinson’s appointment as institute director, the
University also announced that two scholars, an associate professor at
Columbia University and an assistant professor at New York University, would
assume named full professorships at the Pearson Institute._

 _> “For the other two chaired positions, the U of C hired two junior, non-
tenured professors from academic institutions that are ranked below the U of C
in national academic standings,” the complaint reads._

Putting aside the difficulty of rating universities by any objective metric,
when did UChicago become more highly ranked than NYU and Columbia? I'm
surprised about both, but I'm rather shocked about Columbia. According to US
News and World Report[1], UChicago is in a two-way tie for third place among
all universities in the US. I'm aware it's a good school, but I didn't realize
it's "officially" beating out Stanford, MIT, Berkeley, CalTech and every Ivy
except for Harvard and Princeton.

_____________________________

1\. [https://www.usnews.com/best-colleges/rankings/national-
unive...](https://www.usnews.com/best-colleges/rankings/national-universities)

~~~
egocodedinsol
Forgetting about “official” rankings for now, Iirc uchicago has had more nobel
prize winners passing through in some capacity than anywhere else, and its
graduate programs have been among, or the best for a long, long time. It may
not have had “kitchen table” renown but it was well known in academics.

For example, several years ago a couple friends I knew withdrew their
undergrad applications to Harvard when they were granted acceptance to
uchicago because of the mathematics curriculum (it wasn’t an objective choice
necessarily, but it was a well thought out one that was academically
motivated).

It was a little odd that its graduate programs were almost universally held at
the pinnacle of academics, while most people didn’t think the undergrad was
that good. That changed when uchicago accepted the common app (looks more
selective) even though the rest didn’t change as much. Suddenly it skyrocketed
in the rankings. It was always that good, though.

~~~
srtjstjsj
[https://www.bestmastersprograms.org/50-universities-with-
the...](https://www.bestmastersprograms.org/50-universities-with-the-most-
nobel-prize-winners/)

Most Nobel Prizes (per "unnoficial" counts that have some weird inflation for
some universities but not Chicago!):

1\. Harvard

2\. Columbia

3\. Cambridge (UK)

4\. Chicago

5\. MIT

6\. Berkely

7\. Oxford (UK)

~~~
CurtMonash
In 1976 I applied to the 4 of the 5 top grad schools in math (I let my mother
decree that Berkeley was too far away from where she lived -- if that sounds
weird, please realize I was 16 years old at the time). Those were Harvard,
MIT, Chicago and Princeton. I was accepted at all except Princeton, and
visited the other 3. There was no apparent academic difference between the
Harvard and MIT departments, because both schools said one could study
interchangeably at either of them. Harvard easily beat MIT on other criteria.

As for Chicago -- well, when I asked Irving Kaplansky to volunteer something I
might not yet know, he told me the history of the department. That didn't
impress me. I eventually picked Harvard over Chicago for several reasons:

\-- Chicago had a fixed course curriculum. Harvard had zero actual course
requirements. \-- Harvard's faculty seemed more approachable by and engaged
with the students. \-- I was more attracted to Harvard's resources in other
departments. (And in fact, I wound up post-doccing at Harvard in public
policy.) \-- Cambridge was a lot nicer area to live in than the area around
University of Chicago.

I made the right choice. But I surely would have been happy with Chicago as
well.

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bruceb
On a much smaller scale but country singer Garth Brooks donated $500k to his
hometown hospital and then got his money back after they didn't follow
through.

No written agreement but he still won a lawsuit and was awarded damages.

[https://www.nytimes.com/2014/11/07/giving/when-a-donation-
st...](https://www.nytimes.com/2014/11/07/giving/when-a-donation-steers-off-
course.html)

------
mortenjorck
This reads to me a little like an investor lawsuit transposed into the world
of academia. In this case the Pearsons have the role of a philanthropic VC
fund, and the Pearson Institute was a startup whose product would be
groundbreaking research. And now the Pearsons have filed suit alleging that
UChicago misled investors.

~~~
caminante
_> This reads to me a little like an investor lawsuit transposed [...] the
Pearsons have the role of a philanthropic VC fund_

In case you weren't aware, "Venture Philanthropy" is a real, concrete term
used since the 1960's and apropos![0] "Philanthropic VC [Fund]" is an
oxymoron, though, I'm sure it's been used jokingly.

[0] [https://www.investopedia.com/terms/v/venture-
philanthropy.as...](https://www.investopedia.com/terms/v/venture-
philanthropy.asp)

------
setgree
I was briefly a PhD student in government at one of the schools mentioned
herein, and it made a big splash in the field when Blattman & Dube moved. A
few notes.

1) Robinson/the institute using its resources to lure two rising stars rather
than established names is par for the course (though giving them named
professorships so early in their careers is unusual, I think). I doubt the
Pearsons are up on how such things typically operate.

2) The number of people who are both "senior scholars studying conflict
resolution" and "researchers doing data-driven, rigorous work" might be in the
single digits, or an empty set. The people who come to mind are mostly in
their 40s, which is mid-career.

3) I personally hope the Pearsons win their lawsuit. First, giving to a
wealthy university is really bad from an effective altruism POV, and if this
kind of acrimony discourages such donations, _and_ if subsequent substitute
donations create higher utility, then that's great. Second, if universities
only accept gifts whose conditions they are capable of fulfilling, I would
hope for less administrative bloat. Or, just as possibly, the Pearsons'
winning won't have the desired effects at all, who can say.

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fatbird
I feel like part of the story is missing because I have trouble imagining that
UC couldn't easily find someone to head the institute. I would think that
getting to head a well-endowed institute for a top-3 university would be one
of the few steps up a Harvard professor could make--and then to have trouble
even filling other tenured professorships?

Are the Pearsons notoriously difficult people? Was there a perception or
whisper campaign that the institute wouldn't be as academically free or
rigorous as advertised? Was Diermeier maneuvering behind the scenes to torpedo
the institute? I get the sense that a lot of the story is still hidden.

~~~
dbcooper
According to the article, this isn't the first time they've done this:

>The Pearsons are no strangers to lawsuits regarding their philanthropic
contributions. In 2011, Thomas Pearson sued Garrett-Evangelical Theological
Seminary, his father’s alma mater, alleging that a $1.2 million gift made in
their name to the Methodist seminary had been misused. The United States
District Court for the Northern District of Illinois ultimately ruled that the
Seminary had respected the terms of the contract and dismissed all of the
Pearsons’ claims.

My hunch is that they grossly overestimated what a political science
department could do to "reduce conflict around the globe".

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thinkpad20
As a UChicago alum I'm somewhat bewildered by their actions, and saddened for
the bad press and more importantly what seems to be a missed opportunity to
take advantage of an unprecedented gift. I'm curious how this will be seen to
reflect on Robert Zimmer. Although he may not have been directly involved in
the project, I'm sure he had a lot to do with the arrangement and
negotiations, and the buck ultimately stops with him -- assuming, of course,
that UChicago screwed up as they are accused of having done.

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majos
I'm not suggesting this is what's happening, but: does anyone know the
financial implications of making a (presumably tax-deductible) charitable
donation that you later revoke?

~~~
hidenotslide
I'm sure it is structured in a way that mitigates that issue. E.g. donate to
an intermediary trust for the tax benefit, then that trust makes the gift to
the university. In fact the article seems to name this entity as the Pearson
Family Foundation.

------
justboxing
> failed to fulfill several key contractual obligations

I don't understand how you can attach strings (i.e. conditions ) on gifts,
telling the receipt how they can or cannot use the gift.

> In the suit, the Pearsons declared that they had lost all confidence that
> the University would be “an appropriate or capable steward of the Pearson
> Family legacy” as it had allegedly failed to fulfill several key contractual
> obligations that were agreed upon when the gift was made.

This would be akin to telling my dad that I will gift him a car for his
birthday, but on the condition that he can never sell it or rent it out or re-
gift it to his friend. If he doesn't do as I say, I'll sue him to get the gift
(car) back.

Or is it that corporate gifts are not the same as personal gifts?

[EDIT: What's with the downvotes? I'm not trolling, this is a serious
question.]

~~~
praveenperera
From the article it seems like they wanted to make sure the money was going to
good use and it wasn’t.

~~~
ghostly_s
You're not addressing the question, though. This was not a contract for
services rendered. It was a gift.

~~~
ChuckMcM
According to the article it was a contract. The University of Chicago entered
a contract with the Pearson family to host an institute. That the university
_reported_ it as a gift in the press was perhaps unfortunate, but it is
understandable as it has better optics.

If the idea for the Institute had been the universities, and they were
soliciting donors to fund it, and Pearson was one of multiple donors, sure
_that_ would qualify as a gift, but as the article is written, this was a very
different beast.

~~~
jjeaff
It can still be a gift, even if strings are attached.

