Ohio Supreme Court Rules Against Charter Schools in Operator Case

At issue before the court were arguments by several schools formerly run by Akron-based White Hat Management that taxpayer dollars remain public when management companies use them for operating publicly funded charter schools.

The high court ruled in a split decision Tuesday that the assets are instead the property of White Hat Management, the for-profit company that once managed the 10 schools.

Board member Pat Bruns said she perceives the state Department of Education as hard on traditional public schools while giving charter schools a pass.

Last month, Ohio’s charter schools director was ousted after he acknowledged manipulating poor-performing schools’ evaluations, an admission that drew the attention of state authorities.

This week’s Ohio Supreme Court ruling means the schools are not entitled to those assets.

In the majority opinion, Justice Judith Lanzinger noted the schools hadn’t performed well under White Hat’s management, but that the contracts the schools had with White Hat were entered into voluntarily and were enforceable. Not surprisingly, the justices that voted in favor of White Hat have received huge campaign contributions from White Hat’s owner.

The court ordered the case returned to a trial court to inventory the disputed equipment and dispose of it under the terms of the White Hat contract. “The only part of that contract that was fulfilled was that White Hat thoroughly and efficiently received the $90 million”.

“I think that would have required a little bit of judicial gymnastics that probably we generally don’t want to see in contract law”, he said.

Lanzinger questioned whether or not the faculties would knowingly comply with such a clause, however she concluded that it “was an agreed-upon time period”.

Meanwhile, Seattle’s public schools, which were closed due to a teacher strike, will reopen this Thursday as a potential deal may have been reached between the teacher’s union and the Seattle school district.

Recent charter school developments put additional pressure on Ohio lawmakers trying to tighten regulation of the schools via pending legislation.

And Ohio Democratic Party chairman David Pepper says the ruling does nothing to fix what he called the broken system of charter schools in Ohio. “And now we see money – here an operator is running a school, the school fails, and the operator is the one who benefits and the money doesn’t go back to the public taxpayer”.

O’Neill wrote that the contract is “a fraudulent conversion of public funds in to personal profit”.

Justice Paul E. Pfeifer wrote that the court should have overturned the contract.

“This contract term is…so unfair, in fact, as to be unconscionable”, he wrote.