A federal jury in Phoenix ordered Apollo Group Inc., the parent company of the University of Phoenix, to pay shareholders between $270 million and $300 hundred million in damages–or $5.55 a share–for misleading investors.

Jurors on Jan. 16 said Apollo “knowingly and recklessly” made false statements on multiple occasions in 2004. The deception hinged on the company's failure to disclose a Department of Education report criticizing the University of Phoenix's policy of paying staff solely based on the number of students they enroll–a practice under federal ban.

Plaintiffs said Apollo failed to mention the report in a press statement, SEC filing and in multiple analyst calls. The suit covers Apollo investors who owned stock between Feb. 27, 2004, the date of the company's first misleading press release, and Sept. 14, 2004, when investors learned of the Department of Education report.

In a statement, Apollo expressed disappointment in the decision and said it is considering an appeal. “We disagree with the jury's verdict, both the finding and the amount of damages,” said Apollo counsel Wayne Smith, a partner with Gibson Dunn & Crutcher, in a statement. “The law does not require the disclosure of preliminary or unproven charges in a government investigation.”

Smith said premature disclosure of the government report could have “unfairly harmed” students, alumni, employees and shareholders.

As to the issue of the University of Phoenix's recruitment practices, Bloomberg News reported that a lawsuit filed in 2003 by two of the school's counselors is scheduled to go to trial in September 2009. The counselors allege they and their colleagues were paid based on how many students they enrolled.