Jose Angel Santana says he was dismissed from New York University's Tisch School of the Arts when the 127 Hours star, who was enrolled in a fine arts course, made "disparaging and inaccurate public statements" about him.
Santana insisted that he gave the bad grade because Franco only attended two of his 14 'Directing the Actor II' classes, alleging that other professors were lenient on the Oscar nominee because he hired a member of the NYU faculty to write and direct his 2010 film William Vincent.
"The school has bent over backwards to create a Franco-friendly environment, that's for sure," Santana told The New York Post.
"The university has done everything in its power to curry favour with James Franco."
The academic's lawyer Matthew Blit also told the publication that he believed Franco attempted to discredit his client.
Franco was later recruited to teach a class at NYU on adapting poetry into short films.