Harvard University and the Massachusetts Institute of Technology (MIT) have leaned on a century-old law to avoid paying out large sums in lawsuits despite having billion-dollar endowments, legal records show.
President Donald Trump has accused Harvard of abusing its Internal Revenue Service (IRS) tax-exempt status in his ongoing battle against the Ivy League over antisemitism concerns and a lack of ideological diversity. But one advantage of nonprofit status has gone under the radar: Harvard and MIT exploit a state law capping tort claims against charities at $20,000, despite overseeing world-class investment firms managing endowments of $53.2 billion and $24.6 billion, respectively.
“If [Massachusetts residents] get hit by an Amazon truck and become a quadriplegic, be assured that Amazon will be paying them many millions of dollars to look out for them for the rest of their lives. But if they get hit by a Harvard University truck, with a $50 billion endowment, they’re not going to get squat,” Carmine Gentile, a Massachusetts senator, said in an April hearing in support of his bill to strike the charitable immunity cap.
Massachusetts is one of just three states with so-called “charitable immunity,” according to the Nonprofit Risk Management Center, and it imposes the lowest cap on potential damages.
Records indicate Harvard and MIT have in effect argued allegations ranging from the sexual harassment of students to pollution fall under their “charitable” mission. The cap has proven to be an obstacle for plaintiffs suing the universities, who must prove the wrongdoing is “entirely disconnected” from an organization’s charitable purpose to nix the cap, attorneys say.
Invocation of the charity cap can wear down plaintiffs by limiting their ability to hire attorneys who work for a percentage of the plaintiff’s award, some attorneys and plaintiffs say.
Legislators have repeatedly attempted to modify or eliminate Massachusetts’s exceptional treatment of charities. Bills have been introduced in the state legislature each year from 2019–2024 to end Massachusetts’s unique treatment of charities. A Harvard lobbyist pressed state lawmakers on these bills each year, lobbying records show.
Harvard did not respond to requests for comment. MIT declined to comment.
“Caps on lawsuits mean universities can break the law with a smirk, knowing the worst they’ll face is a minor fine they’ll pay with your tax dollars,” said Isaiah Hankel, an expert and consultant in higher education and the job market.
‘Demands Attention’
MIT, Harvard and Harvard Medical School’s affiliated teaching hospitals have invoked the cap on charity payouts in several cases across the last three decades, a review of legal documents shows.
The concept of charitable immunity originates with an 1871 pronouncement in England that was later repudiated, according to Massachusetts attorney Jeffrey S. Beeler.
“It was a bad idea from its inception,” said Beeler in a speech to the Massachusetts Judiciary Committee supporting repeal of the provision nearly two decades ago. “Nonetheless, it took root here and persisted for more than 100 years.”
Nonetheless, charitable immunity has remained on the books and repeatedly cited by university attorneys, records show.
When Harvard was sued in 2019 over its ownership of two images of enslaved people commissioned in 1850, the university cited its “charity” status in an effort to contain the potential damages. Harvard finally relinquished the photos on May 28 after a six-year legal battle. Harvard agreed to an undisclosed financial settlement with the plaintiff.
“Plaintiff’s damages are limited in whole or in part by charitable tort immunity pursuant to Massachusetts General Laws,” Harvard attorneys argued in a 2023 filing.
MIT introduced charitable immunity as an 11th hour defense in a case filed in 2021 by former research lead Babak Babakinejad, a bioengineer who blew the whistle on an agriculture project he alleges was scientifically fraudulent.
The MIT Media Lab project — which one tech blog dubbed “Theranos for Plants” — promised prospective donors that “food computers” could grow plants quickly in any environment, while in reality Media Lab faculty allegedly filled “food computers” with plants from nearby markets. The lab has also been fined for dumping wastewater underground.
Babakinejad alleges the fraud implicates MIT leadership because the university’s fundraising arm highlighted the “food computers” in a $6 billion pledge drive, and that discovery in his case will reveal documents related to MIT’s donations from pedophile Jeffrey Epstein.
MIT sought charitable immunity in 2024, three years into the case, which a Democrat-appointed judge ultimately granted eight months after that. Babakinejad argues that invoking charitable immunity is yet another obstacle in a convoluted battle with the university.
In Massachusetts, we have a passion for learning and discovery. We cure disease. We invent technology. We never back down from a challenge.
Bringing together the brightest minds from all over the world, @MIT and its graduates are pillars of our global leadership. From me and… pic.twitter.com/uyqXJv0rai
— Governor Maura Healey (@MassGovernor) May 29, 2025
“All of this has interfered with my ability to fairly litigate claims involving fraud, Jeffrey Epstein, whistleblower retaliation, and illegal chemical discharges that endangered public safety – none of which, in my view, qualifies as charitable,” Babakinejad said to the Daily Caller News Foundation. “This is a public interest issue that demands attention.”
Babakinejad’s case is not an isolated event.
Harvard settled a case in 2024 with three women who alleged the university mishandled their concerns about sexual harassment and retaliation by a tenured professor, but not before invoking the charitable immunity cap.
“Plaintiff’s damages are limited in whole or in part by charitable tort immunity pursuant to Massachusetts General Laws,” Harvard’s attorneys again argued in a 2023 filing.
In response to MIT asserting a charitable immunity defense in a 2017 case over the suicide of a doctoral student, plaintiff’s counsel argued that “justice cannot possibly be done in any case involving claims of charitable immunity unless the plaintiff is freely allowed to advance claims against responsible corporate employees.”
Harvard-affiliated Brigham & Women’s Hospital invoked a charitable immunity cap in a 2003 case over alleged negligence in a newborn baby’s care after admitting it lost the relevant medical records. A dissenting judge on the Massachusetts Supreme Judicial Court said that charitable immunity is “unfair” and “obsolete.”
The loophole “fails to properly balance the interest of the innocent victim and that of the negligent charitable organization,” Justice Roderick L. Ireland argued.
.@POTUS: Part of the problem with Harvard is that there are almost 31% foreigners at Harvard… but they refuse to tell us who the people are. We want to know. Now, a lot of the foreign students, we wouldn’t have a problem with… but it shouldn’t be 31%. pic.twitter.com/twB6HwqIYh
— Rapid Response 47 (@RapidResponse47) May 25, 2025
Attorneys and plaintiffs point to the litany of cases in which elite institutions like Harvard and MIT invoke their “charitable” status to undercut individuals who allege wrongdoing as an abuse of their power.
“I’m talking about young women sexually victimized by the college campus rape culture due to the lack of proper policies, practices, and procedures,” said Beeler, the Massachusetts attorney, in his April testimony. “I’m talking about the parents who get a phone call that their college age student is dead by suicide on campus who later found out that there are all sorts of warnings known to the institution that were not acted on. I’m talking about fundamental fairness and sound fiscal public policy.”
Babakinejad said he plans to challenge the late introduction of the charitable defense in his case to protect the integrity of the legal process.
“I’ll seek full discovery so a jury can evaluate the facts and decide whether MIT deserves protection or accountability,” he said.
Caden Olson contributed to this report.
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