By Richard Vedder
The settlement of the lawsuit brought by the Robertson family against Princeton University in one respect is a bit disappointing. It would have been nice to have a definitive court ruling on the matter. Yet settling the case was obviously in the best interests of both parties.
For readers unfamiliar with the issue, a bequest by the Robertson family to Princeton grew over time to the better part of a billion dollars. The family felt that Princeton was not using the funds (or most of the funds) for the purpose for which the donor intended. While Princeton did not admit any wrongdoing, the fact that it is paying out the better part of $100 million to the Robertsons is a sign that they were not completely confident in the outcome of the case --or that the negative publicity about the case was seriously hurting Princeton in its relations with alums.
This case has one good outcome. Universities better pay attention to how they use gifts. Donor intent matters. The Robertson family has done a public service by bringing this issue to the forefront. Donors need to be very, very careful in how they make gifts if they want them to serve a specific purpose.