A joint venture headed by a minority-owned investment bank has sued the U.S. Department of Education over the selection of a designated bonding authority for a financing program to aid historically black colleges and universities.

In a lawsuit filed Sept. 19 in the U.S. District Court for the District of Columbia, San Francisco-based Grigsby, Brandford & Co. and A.H. Williams & Co. of Philadelphia called Education Secretary Richard W. Riley's selection of Pryor, McClendon Counts & Co. unlawful, and said it was "arbitrary and capricious, lacking a rational basis and an adequate statement of reasons."

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