honestly, fuck california.
On the other hand you see this mighty government unilaterally fining them for providing this service.
However, the problem is the law has to work in the abstract for every case and not just for this benign case.
If they don't ask them to work with the law now, what happens when a terrible institution that doesn't provide value and really takes advantage of its customers opens up?
Then they can say, hey you didn't fine lambda, why are you fining us?
And, worst of all, they would be right.
In the long run, this ought to provide a barrier to entry for sub-par institutions.
(Btw, I haven't gone through lambda or any competitor, and I don't have an opinion as to the quality of the programs).