Press Release

Defense, Health Care and Education Industries Join University of Phoenix in Asking U.S. Supreme Court to Curb Abuse of False Claims Act
Phoenix, Arizona, March 27, 2007 -- The National Defense Industrial Association, American Health Care Association, National Association for the Support of Long Term Care, and Career College Association have joined University of Phoenix, subsidiary of Apollo Group, Inc. (Nasdaq:APOL), in urging the United States Supreme Court to curb increasing abuse of the False Claims Act, a statute designed to remedy false or fraudulent claims for payment submitted to the federal government. Their views supporting University of Phoenix's legal position were expressed in a series of amicus curiae (“friend of the court”) briefs filed yesterday in United States ex rel. Hendow v. University of Phoenix.

University of Phoenix has asked the U.S. Supreme Court to review a recent decision by the Ninth Circuit Court of Appeals that dramatically expands the scope of the False Claims Act and conflicts with the rulings of other federal appellate courts. As expressed by the Career College Association, “the implications of this holding are dire.” If the Ninth Circuit's decision is not corrected, it will expose higher education institutions, as well as all other companies that conduct business with the federal government, to an increase in meritless litigation and to the risk of substantial False Claims Act liability that Congress never intended to authorize.

Addressing the Ninth Circuit's erroneous interpretation of the False Claims Act, the Career College Association argued in its brief that “the Ninth Circuit has transformed the FCA [False Claims Act] from its intended purpose 'to combat and deter fraud' into a potentially lethal trap for any postsecondary institution alleged to knowingly be in violation of even one of what the Ninth Circuit defines as a condition of eligibility. . . . Moreover, this particular trap is replete with mandatory double or treble damages and additional monetary penalties.”

The False Claims Act includes a legal device called a “qui tam” provision that allows a private person, known as a “relator,” to bring a lawsuit on behalf of the United States and share in up to 30 percent of any recovery. As recognized by the National Defense Industrial Association in its brief, the Ninth Circuit's decision “could encourage qui tam relators to pursue FCA claims for settlement value. . . . If the FCA is not applied consistently and in a manner that prevents frivolous, vexatious lawsuits by qui tam relators, businesses will be unable to manage the risks of FCA liability. Responsible businesses will be discouraged from providing valuable needed services to the government, and the costs of government procurement will increase.”

Supreme Court review of the Ninth Circuit's decision is necessary to reconcile the lower federal courts' conflicting interpretations of the False Claims Act and to provide certainty to companies that do business with the federal government. As expressed by the American Health Care Association and the National Association for the Support of Long Term Care, “The Court should grant UOP's [University of Phoenix's] petition in order to provide guidance to the lower courts on the proper boundaries of the FCA as applied to heavily regulated industries. . . . No place is the tension . . . more evident or more prevalent than in the health care context. The federal government is the largest single purchaser of health care in the United States.”

A decision by the U.S. Supreme Court on whether to hear University of Phoenix's case is expected in early spring. Complete copies of the amicus briefs filed yesterday are available in the Legal Information Center at www.apollogrp.edu.

About Apollo Group, Inc., parent company to University of Phoenix:
Apollo Group, Inc. has been an education provider for more than 30 years, operating the University of Phoenix, the Institute for Professional Development, The College for Financial Planning, Western International University and Insight Schools. The Company offers innovative and distinctive educational programs and services from high school through college level at 262 locations in 39 states, Puerto Rico, Washington DC, Alberta, British Columbia, Netherlands, and Mexico as well as online, throughout the world.

For more information about Apollo Group, Inc. and its subsidiaries, call (800) 990-APOL or visit Apollo on the company website at: www.apollogrp.edu.

About the National Defense Industrial Association:
The National Defense Industrial Association is a non-profit organization comprised of more than 1,200 corporations and 39,000 individuals spanning the spectrum of the defense industry. Members include individuals from academia, government, the military services, small businesses, corporations, prime contractors and the international community. They fulfill a large share of the U.S. Department of Defense's contracts for goods and services. For more information about the National Defense Industrial Association and its affiliates, visit www.ndia.org.

About the American Health Care Association:
The American Health Care Association is one of the nation's leading long-term care organizations. It is the national representative of more than 10,000 non-profit and proprietary facilities dedicated to improving the delivery of professional and compassionate care to more than 1.5 million frail, elderly and disabled citizens who live in nursing facilities, assisted living residences, subacute centers, and homes for persons with mental retardation and developmental disabilities. For more information about the American Health Care Association, visit www.ahca.org.

About the National Association for the Support of Long Term Care:
The National Association for the Support of Long Term Care represents providers of ancillary products and services to the long-term care industry. Member companies provide therapy services, diagnostic services, software systems, and medical equipment and supplies to long-term care facilities. For more information about the National Association for the Support of Long Term Care, visit www.nasl.org.

About the Career College Association:
The Career College Association is a voluntary membership organization of more than 1,150 private, accredited, postsecondary colleges, universities, schools and institutes. Its members cover the full range of postsecondary education, from certificate and diploma programs to programs leading to associates, masters and doctoral degrees. The Career College Association's members, most of which are organized as tax-paying entities, enroll nearly two million students each year. These students train for employment in 200 occupational fields and represent approximately one-half of the technically trained workers who enter the U.S. workforce each year. The vast majority of the Career College Association's member institutions participate in one or more of the federal student financial aid programs as well as in other federal, state and local education and workforce training programs. For more information about the Career College Association, visit www.career.org.

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