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Specifically, I don't think that USNews necessarily rewards schools for being small. Consider this. What's the most populous full-time law school in the country? Some scrub school? No, it's Harvard Law. Yep - HLS is absolutely gigantic in terms of student population. Literally triple the size of peer schools like Yale law or Stanford Law. Yet there Harvard sits at #2, lower than Yale, but higher than Stanford.
In fact, of the top 5 in the USNews rankings, 3 of them are large. Harvard, Columbia, and NYU are not small law school by any stretch. Hence, I don't know how you can say that USNews discriminates against large schools.
My issue with the press release is that it seems as if Hastings thinks it deserves a top ranking just because it is located in San Francisco and by being part of a strong university system.