[16] In 2017, Education Management Corporation sold the existing Art Institutes to The Dream Center Foundation, a Los Angeles-based Pentecostal organization.

[19] As of August 2019, eight locations remain open to new students, operated by the Education Principle Foundation, and no longer connected to EDMC or Dream Center.

[26][27][28] In June 1986, Robert Knutson and Merrill Lynch Capital Partners led a recapitalization of the company in which Richard Royston, co-CEO, was bought out.

[29][31] In 2003 EDMC acquired the health sciences-focused South University in April[31][32] and 18 schools operated by the Ohio-based American Education Centers in June, which were re-branded Brown Mackie College a year later.

[27][36][41][42] Enrollment in EDMC's online programs ballooned from 7,900 in 2007 to 42,300 in 2012, due in large part to practices that devoted more per-student expenditures to marketing ($4,158) than on education ($3,460).

[44] In 2011, EDMC and its then-subsidiary, the Art Institutes, received greater public scrutiny with the release of the Frontline documentary: Educating Sergeant Pantzke.

[46] The decrease in enrollment, coupled with pending changes to the U.S. Department of Education's "gainful employment" rule, prompted EDMC to hold off expansion plans in 2012,[10] and led to several rounds of layoffs.

[59][60] On November 16, 2015, federal and state authorities announced a $95.5-million settlement resolving a whistleblower case in which former EDMC employees said the company was "illegally paying recruiters based on the number of students they enrolled".

[25] In 2017, EDMC reported that it had sold the existing Art Institutes to The Dream Center Foundation, a Los Angeles-based Pentecostal organization.

[65] In 2017, EDMC reported 109 locations, but more than 40 Brown Mackie Colleges and Art Institutes schools were in the process of closing at that time.

"[68][69] In April 2023, the Supreme Court rejected a challenge to the settlement and allowed to proceed the debt cancellation due to alleged fraud.

[42][71][72] EDMC opposed the rule's original draft, arguing that it limited minority and low-income students access to higher education.

[72] EDMC Senior VP of Regulatory Affairs and Strategic Development, Anthony J. Guida Jr., served, by appointment, on the U.S. Department of Education's Advisory Committee on Student Financial Assistance from 2009 until September 2012.

[78] In response to the charges, EDMC stated that the compensation plan in question was in compliance with then-current federal rules and had been reviewed and approved by two education law firms.

This lawsuit alleged that the company deliberately misclassified data to inflate the job-placement rates of its graduates and make the school more attractive to prospective students.

[82] In May 2013 U.S. Judge McVerry rejected EDMC's appeal to dismiss the case,[83] and on May 11, 2014, he ordered full-blown pretrial discovery regarding the claims and defenses.

[11] In December 2013, EDMC settled a civil claims suit filed by the Colorado Attorney General's Office for $3.3 million.

The suit was brought following investigation by the attorney general's office, and alleged that the company's Argosy University in Denver violated the Colorado Consumer Protection Act by engaging in deceptive marketing, in particular misleading students about prospects for employment following graduation.

In November 2015, the US Justice Department announced that EDMC will pay nearly $95.5 million to settle claims the company used illegal incentives causing recruiters to use high-pressure tactics to convince students to enroll in the school.

In addition, the deal covers allegations made as part of a consumer fraud investigation by the attorneys general of 39 states and the District of Columbia over claims the company misled students about job placement rates and other postgraduation outcomes while recruiting them.

[87] Four states initiated investigations in recent years with Florida in October 2010, New York, California[79][88] and a subpoena of documents regarding Brown Mackie College from the Office of Consumer Protection of the Kentucky Attorney General in December 2010.

[89] In August 2010, EDMC and other private sector schools were investigated by the U.S. GAO, which reported that Argosy University (Chicago) recruiters misled undercover students about tuition and program quality.

[37][90] The GAO later revised parts of its original report from the investigation, which was the focus of testimony at a U.S. Senate HELP committee September 2010 hearing.

[91] A 2011 US DOJ report claimed that EDMC "created a 'boiler room' style sales culture and has made recruiting and enrolling new students the sole focus of its compensation system".

[92] In January 2014, EDMC was among several for-profit schools approached by approximately a dozen attorneys general for information in an investigation of their practices.

[97] In April 2016, two former teachers at the Art Institute of California sued EDMC for not giving them a minimum wage and for not offering adequate rest periods in order to 'reduce compensation and increase its own profits.

[101] In 2016, former nursing students at Brown Mackie College in Tucson, Arizona sued the school, alleging that the poor training they received left them unable to be gainfully employed.

The plaintiffs expected to graduate in 2015 until a state nursing board investigation found some of the school's faculty were unqualified and were using veterinary supplies to teach students how to care for human patients.

[103] Advised by Attorney Katherine Ryan before two federal judges in discrimination lawsuits dating to August 2012, the company was defeated when the U.S. Court of Appeals for the Third Circuit issued a sweeping October 18 order invalidating an alternative dispute resolution policy superimposed retroactively on the company's employees; EDMC had tried to bar aggrieved employees from filing suit in any court for any purpose.

[104] The 3-0 panel found that the policy had been illegally superimposed without employees' assent and thereby reinstated a pair of federal cases against the Art Institute of Pittsburgh demanding more than $4 million in damages and alleging legal malpractice inside EDMC.