INVESTOR ALERT: Investigation of K12 Inc. Announced by Law Offices of Howard G. Smith

August 03, 2016 10:30 AM Eastern Daylight Time

BENSALEM, Pa.–(BUSINESS WIRE)–Law Offices of Howard G. Smith announces an investigation on behalf of
investors of K12 Inc. (“K12” or the “Company”) (NYSE: LRN)
concerning the Company and its officers’ possible violations of federal
securities laws.

online charter schools had significantly weaker academic
performance in math and reading, compared with their counterparts in
conventional schools.”

Tweet this

On October 27, 2015, Stanford’s Center for Research on Education
Outcomes (“CREDO”) published a study concerning online charter schools
that specifically mentioned K12. Based on their findings, CREDO stated
that “online charter schools had significantly weaker academic
performance in math and reading, compared with their counterparts in
conventional schools.” Additionally, that same day, K12 revealed that it
had received a civil investigative subpoena from the Attorney General of
California on September 24, 2015.

Over the next three days, K12’s stock price fell $0.54 per share, over
5%, to close at just $9.71 on October 30, 2015.

If you purchased K12 securities, have information or would like to learn
more about these claims, or have any questions concerning this
announcement or your rights or interests with respect to these matters,
please contact Howard G. Smith, Esquire, of Law Offices of Howard G.
Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020 by
telephone at (215) 638-4847, toll-free at (888) 638-4847, or by email to howardsmith@howardsmithlaw.com,
or visit our website at http://www.howardsmithlaw.com.

This press release may be considered Attorney Advertising in some
jurisdictions under the applicable law and ethical rules.

Contacts

Law Offices of Howard G. SmithHoward G. Smith, Esquire215-638-4847888-638-4847howardsmith@howardsmithlaw.comwww.howardsmithlaw.com

Law Offices of Howard G. Smith

Release Summary

INVESTOR ALERT: Investigation of K12 Inc. Announced by Law Offices of Howard G. Smith

Contacts

Law Offices of Howard G. SmithHoward G. Smith, Esquire215-638-4847888-638-4847howardsmith@howardsmithlaw.comwww.howardsmithlaw.com

Ohio’s charter schools ridiculed at national conference, even by national charter supporters

Children stands in line for a turn on a bounce house/obstacle course during the new Pearl Academy open house as a large banner encourages passers-by to sign up for classes Friday, June 21, 2013 in Lakewood. This is at the former Saints Cyril and Methodius school building. The open house was being hosted by White Hat Management, a company that operates lots of charter schools in Ohio.

Plain Dealer photography staff

By

The Plain Dealer
Email the author | Follow on Twitter

on March 02, 2015 at 12:23 PM, updated

DENVER, Colorado – Ohio, the charter school world is making fun of you.

Ohio’s $1 Billion charter school system was the butt of jokes at a conference for reporters on school choice in Denver late last week, as well as the target of sharp criticism of charter school failures across the state.

The shots came from expected critics like teachers unions, but also from pro-charter voices, as the state considers ways to improve how it handles charters.

Ohio has about 123,000  kids attending nearly 400 charter schools – public schools that receive state tax money, but which are privately run.

One after another, panelists at the conference organized by the national Education Writers Association targeted Ohio’s poor charter school performance statewide, Ohio’s for-profit charter operators and how many organizations we hand over charter oversight keys to as the sponsors, or authorizers, of schools.

“Be very glad that you have Nevada, so you are not the worst,” Stanford University researcher Margaret “Macke” Raymond said of Ohio. 

Places like Massachusetts and Washington, D.C., she told reporters from across the country, have high standards for charter school performance.

“Then you have folks at the low end, of which Ohio is a strong case,” said Raymond, who released a report on Ohio’s charter performance in December.

Stanford’s Center for Research of Educational Outcomes (CREDO), found that students learn less in Ohio’s charter schools than in traditional districts – the equivalent of 36 days of learning in math and 14 days in reading.

The National Education Association’s David Welker, a member of NEA’s charter policy team, said Ohio’s system has been taken over by “grifters” and “cheats” – the for-profit companies that run many Ohio schools.

He was suspect about Ohio’s attempts to rein them in, saying, “the horse has left the barn.”

The National Alliance for Public Charter Schools, a major national organization supporting the charter school movement, didn’t disagree.

“There are some operators who are exploiting things,” said Todd Ziebarth, a vice president of the Alliance.

He specifically named K12 Inc. and White Hat Management as major offenders. K12 is the nation’s largest provider of online charter schools and runs Ohio Virtual Academy, while White Hat is an Akron-based operator of many low-scoring charter schools that has regularly been a large donor to Republicans in Ohio. 

As Ziebarth started naming White Hat and K12, panelist Michael Petrilli of the Fordham Institute jumped in to add The Electronic Classroom of Tomorrow (ECOT) to the list. That online school is run by William Lager, another major donor to Ohio Republicans.

Just last month the Akron Beacon-Journal reported that former Ohio House Speaker William Batchelder formed a lobbying company that will have former House staffers lobby for ECOT.

“Mike could probably go down a list of Ohio operators,” Ziebarth said.

Petrilli nodded and added: “Ohio needs a top-to-bottom overhaul of its charter school sector.”

Fordham is both a charter supporter and critic. It sponsors, or authorizes, some charter in Ohio and promotes school choice efforts, while also wanting better quality. Fordham helped sponsor the CREDO study in Ohio, as well as another study suggesting ways to reform charter laws in Ohio.

Alex Medler of the National Association of Charter School Authorizers added his own criticisms of Ohio’s system, but far more subtle ones.

But Medler had already made his views on Ohio’s charter system clear a year ago, when he derided Ohio’s charter school free-for-all as “the Wild, Wild West” of charters.

Both Gov. John Kasich and Republicans in the Ohio House have made separate proposals to change the oversight and management of charter schools. A third proposal is coming soon from the Ohio Senate and State Auditor Dave Yost is expected to propose some additional changes this week.

Some of the suggested that Fordham seeks have been incorporated into House Bill 2 or Kasich’s charter reform plan.

While both proposals so far are receiving praise for taking on some important issues, some want them to go further.

For another account of the criticism at the conference in Denver, see this report from the Akron Beacon-Journal.

To follow education news from Cleveland and affecting all of Ohio, follow this reporter on Facebook as @PatrickODonnellReporter

Motoko Rich writes in the New York Times about the terrible results obtained by online charter schools. She focuses on the Electronic Classroom of Tomorrow, whose founder has become very wealthy thanks to taxpayer money and the friendship of reformers such as Governor JohnKasich and the GOP legislators in Ohio. Founder William Lager has been very generous to his friends who hold elected office.

 

A terrific business. A lousy education.

 

Five years ago, the New York Times ran a superb expose of online charters, pointing out that they are very profitable but basically scams that rip off taxpayers.

 

In 2011, the Washington Post published an excellent expose of Michael Milken’s K12 Inc, which is listed on the New York Stock Exchange.

 

 

For-profit virtual charter corporations are a cynical business that exploits children and does not have educate them. It demands full state tuition to provide home schooling plus a “teacher” on a monitor.

 

I wrote about the online charter fraud in my 2013 book “Reign of Error.”

 

Numerous studies have concluded that these schools have startlingly high attrition rates, large “class” sizes, low wages, high teacher turnover, and their students very little.

 

The latest study, by CREDO, found that students lost 180 days of instruction in math for every year of 180 days in a virtual charter.

 

Bill Phillis of the Ohio Coalition for Equity and Adequacy wrote about today’s article in the Times and pointed out that ECOT has received nearly $1 billion in public funding since 2002.

 

Frankly, these fake schools should be investigated by authorities, monitored, and limited to students who are unable to attend school. They should exist only as public institutions, not profit-making corporations.

via Diane Ravitch’s blog

http://ift.tt/1OBYU4C

K12 Inc. Continues Its Downward Bounce

Posted

By David Safier

on at 5:00 PM

click to enlarge

k12-inc.-stock12-21-15.jpg

I’ve been following the fortunes of K12 Inc., the for-profit, publicly traded, online school corporation, since 2008 when I broke the story that it had been outsourcing student essays to an essay-grading company in India without informing the parents. (K12 Inc. said it stopped the practice soon after the story broke). The corporation is the poster child for everything wrong with the for-profit education model where profits, rather than education, drive the enterprise. For awhile, K12 Inc. was flying high despite its reputation for low student achievement and high student turnover. That all changed in the middle of 2013 after the stock peaked at 36. As you can see from the chart at the top of the post, it’s taken a bumpy downhill ride since them. Current stock price is in the nine dollar range.

Local angle: K12 Inc. operates Arizona Virtual Academy (AZVA) which has about 4,600 students statewide.

You never know, the stock prices could reverse themselves and head upwards again—which, after all, is the primary purpose of any publicly traded corporation—but I doubt it. K12 Inc. is facing a whole lot of obstacles, all of which help tamp down investor confidence.

A recent study concludes that online charter schools in general, K12 Inc. included, are doing a lousy job of educating their students. Three research institutions participated in the study, including CREDO out of Stanford University, which tends to be pro-privatization and whose last comparison of charter and district schools had charters coming out a little ahead. (In its previous study, district schools came out a little ahead.) The academic growth of online school students is so low that, according to CREDO, it’s as if students missed half a year’s learning in reading and a whole year’s learning in math compared to district schools. This shouldn’t come as much of a surprise. Online schools like those run by K12 Inc. amount to home schooling with benefits. If you have motivated students whose parents keep them on task, they’ll learn from the parent-assisted curriculum. But because of the need to keep student numbers growing in the face of one-third of the students leaving every year, K12 Inc. actively recruits students who are unsuited for education that comes to them through a computer in their homes. Yet those students are encouraged to stay enrolled because, like other charter schools (and district schools as well), online charters get money from the state on a per student basis. Lose students, lose money.

Currently, K12 Inc. is being investigated over possible securities laws violations. It’s been alleged that there is a “substantial disconnect between compensation and performance results.” This isn’t the first time stockholders have complained about the company. Previously, stockholders sued because they said K12 Inc. inflated its schools’ academic results. During the most recent shareholder meeting, investors voted down the corporation’s plan for executive pay. The previous year, the CEO received $5.33 million and the CFO received $3.6 million.

Some teachers are none too happy with their online schools, most vocally at California Virtual Academies (CAVA), where teachers have been complaining for years about the school. In The Public Interest wrote an in depth study of CAVA detailing problems with student performance levels and poor teaching environment as well as the use of revenue for advertising, executive pay and profit.

Finally, some schools have left or are considering leaving the K12 Inc. fold as their contracts with the corporation expire. The latest is Massachusetts Virtual Academy (MAVA) whose contract is up in June, 2016. It’s considering two other online curriculum providers.

Put this all together, and you have a corporation in serious trouble. 

Shocker: Texas Lifts Enrollment Caps on K12 | Diane Ravitch’s blog

Shocker: Texas Lifts Enrollment Caps on K12

Diane Ravitch's blog[1]

A site to discuss better education for all

K12, the online charter corporation founded by the Milken brothers, has received a series of terrible evaluations. The NCAA recently denied a score of K12 “schools” credit because of the poor quality of instruction. A CREDO study in Pennsylvania concluded that virtual charters performed wose than public schools or brick-and-mortar charter schools.

Major stories in the Néw York Times and the Washington Post have reported that K12 virtual charters have high attrition rates, low test scores, and low graduation rates.

But K12 is good at two things: recruitment and lobbying.

In this article[2], Jason Stanford reports that Texas Commissioner of Education Michael Williams just lifted the enrollment cap on K12. Williams was previously head of the Railroad Commission, which theoretically “regulates” the energy industry.

According to Stanford, Williams is a friend of K12′s lobbyist. He, along with other key state officials, attended her lavish birthday party in Wine Country. The GOP candidate for governor has pledged to increase funding for K12.

In Texas, it seems the #1 criterion for education funding is not need, but lobbying. Kids come last.

Shocker: Texas Lifts Enrollment Caps on K12 | Diane Ravitch’s blog

Shocker: Texas Lifts Enrollment Caps on K12

Diane Ravitch's blog[1]

A site to discuss better education for all

K12, the online charter corporation founded by the Milken brothers, has received a series of terrible evaluations. The NCAA recently denied a score of K12 “schools” credit because of the poor quality of instruction. A CREDO study in Pennsylvania concluded that virtual charters performed wose than public schools or brick-and-mortar charter schools.

Major stories in the Néw York Times and the Washington Post have reported that K12 virtual charters have high attrition rates, low test scores, and low graduation rates.

But K12 is good at two things: recruitment and lobbying.

In this article[2], Jason Stanford reports that Texas Commissioner of Education Michael Williams just lifted the enrollment cap on K12. Williams was previously head of the Railroad Commission, which theoretically “regulates” the energy industry.

According to Stanford, Williams is a friend of K12′s lobbyist. He, along with other key state officials, attended her lavish birthday party in Wine Country. The GOP candidate for governor has pledged to increase funding for K12.

In Texas, it seems the #1 criterion for education funding is not need, but lobbying. Kids come last.

Funniest Story of the Month | Diane Ravitch’s blog

Funniest Story of the Month

Diane Ravitch's blog[1]

A site to discuss better education for all

As I was doing some research about virtual charter schools, I came across an article that caused me to laugh out loud[2].

It appeared in the Star-Ledger, the main newspaper in New Jersey. It was titled “State Has Virtually No Reason to Not Give Online Charter Schools a Shot.”

It said the state should stop “dithering” and should promptly approve an online charter school. No delay, no moratorium, approve the online school now.

It was published on July 11, 2012, as the state’s Acting Commissioner of Education Chris Cerf and the state board of education were mulling a decision to authorize the megacorporation K12 to open an online charter school in New Jersey.

The reason I laughed out loud was that the article appeared on the same day that the FBI raided the offices of the Pennsylvania Cyber Charter[3]. See here too[4].

And it appeared several months after the New York Times published a withering expose of the terrible academic record [5]of K12.

And it appeared fourteen months after the CREDO study of virtual charters in Pennsylvania,[6] which showed they get awful results.

The invaluable New Jersey blogger Jersey Jazzman showed the fallaciousness of the claim [7]that the state should not wait for more research but should promptly approve a virtual charter school.

Truly, this is one of those laugh out loud moments. They are so few these days that we should enjoy them.

K12, the online charter corporation founded by the Milken brothers, has received a series of terrible evaluations. The NCAA recently denied a score of K12 “schools” credit because of the poor quality of instruction. A CREDO study in Pennsylvania concluded that virtual charters performed wose than public schools or brick-and-mortar charter schools.


Major stories in the Néw York Times and the Washington Post have reported that K12 virtual charters have high attrition rates, low test scores, and low graduation rates.


But K12 is good at two things: recruitment and lobbying.


In this article, Jason Stanford reports that Texas Commissioner of Education Michael Williams just lifted the enrollment cap on K12. Williams was previously head of the Railroad Commission, which theoretically “regulates” the energy industry.


According to Stanford, Williams is a friend of K12′s lobbyist. He, along with other key state officials, attended her lavish birthday party in Wine Country. The GOP candidate for governor has pledged to increase funding for K12.


In Texas, it seems the #1 criterion for education funding is not need, but lobbying. Kids come last.
















via Diane Ravitch’s blog http://ift.tt/1mYcBQ5