University hires prominent law firm to represent it in tax challenge case

The University has hired Simpson Thacher & Bartlett, one of the largest law firms in the world, to defend it in a court challenge to the school’s tax-exempt status. The firm, which was also involved in the 2002 lawsuit brought against the University by descendants of the Robertson family over donations made to the Wilson School's graduate program, regularly represents major corporate clients.

The University has also hired New Jersey-based firm Archer & Greiner as co-counsel.

University Counsel Hannah Ross and University Vice President and Secretary Robert Durkee '69 both confirmed the hiring but declined to be comment on the decision.

Neither Simpson Thacher & Bartlett nor Archer & Greiner responded to requests for comment.

The University currently does not pay property taxes on most of its land, in keeping with an exemption granted by New Jersey law to educational institutions. The challenge began in 2011, when a group of local residents sued the University to challenge the tax-exemption status of 19 campus buildings, arguing that the facilities were used for non-educational uses.

The plaintiffs have now added an additional charge alleging that the University is not qualified for the tax exemption because it in fact makes money and distributes profits, especially proceeds from patents registered by the University. Since this charge was added, the case has gained increased media attention, including an op-ed on the suit published in The Wall Street Journal last summer.

The case appeared before a New Jersey tax court judge in June, when the University requested to have the case dismissed. The judge denied the request, attorneys representing both sides of the case have confirmed.

The buildings whose exemption is challenged in the suit include McCosh Health Center, Frist Campus Center, Richardson Auditorium and McCarter Theatre. Also included is 48 University Place, which houses several student publications, including The Daily Princetonian.

In 2002, the University was sued by the Robertson Foundationover a 1961 $35 million donation given by the Robertson family to fund the Wilson School's graduate programs.The family had asked that the money be used to educate graduate students preparing for careers in government, and their descendants alleged in the suit that the University had instead been using the funds to train students for a broader range of careers, including those in the private sector. The University reached a settlement with the Foundation in 2008 that allowed it to retain the endowment but pay certain fees to the Foundation.

The town of Princeton is also listed as a defendant in the suit, as plaintiffs allege that the town tax assessor has incorrectly listed the properties in question as tax-exempt.

Local lawyer Bruce Afran, who is representing the plaintiffs, also represents several clients in unrelated suits challenging the University’s move of the Dinky station.