Lawsuit against California Northstate CP

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I was recently accepted to California Northstate CP class of 2016. I was so excited to get a chance to go there. Then I heard there was a lawsuit against CNCP, I figured it was probably no big deal; lawsuits are filed for really frivolous things, but then I got curious to see what it pertained to. After reading the complaint, I was a bit shocked. Many allegations are made against CNCP, but what caught my attention the most were

1) CNCP participating in illegal tuition schemes
2) CNCP putting profits over education
3) Mr. Brazill reporting to the accreditation board that CNCP lacked the resources necessary for accreditation.

Is this as serious as it sounds? Could CNCP get into trouble if this alleged tuition scheme is real? Could they lose their candidate status? After already giving them $1500 I am a little wary about giving another $5000 in just a few more weeks, should I be worried?

here is a link to the complaint (downloaded 5/18/12 from PACER)
http://www.mediafire.com/view/?4izccdmmf6uiw2z

Here is Brad Brazill's linkedin profile, seems like he has been in the pharmacy industry for a while and is credible. http://www.linkedin.com/pub/bradley-j-brazill/32/842/6a

Help!

Originally Posted by pharmnerd2012

2) CNCP putting profits over education

CNCP is a for profit institution and has fiduciary duty towards its shareholders first and not its students. There's really no way around this fact because of how it's set up.

That's not to say for profits do not have the best of intentions with regards to students, but this is the cold calculus of any business.

Read the first page, sounds like a 12 year old wrote the introduction, hahaha.

I love reading court filings. I got to the part about the "illegal tuition scheme" and I'll vouch that MANY sdn members from CNCP have been doing this and were advising others to do this as well as a "work around" for their inability to get student loans due to lack of regional accreditation via WASC.

It was a good idea at the time, but I didn't think the school would ever promote it, but I guess it allegedly did per this filing. Massively illegal...you know those lists no one ever reads about what you can spend your student loans on? Yup...I suspect that if this lawsuit isn't settled, current/former students are going to get subpoenaed to testify about this practice.

Very interesting...even though 90%+ of us end up spending our excess loan disbursements on things that probably aren't covered. That's one thing...promoting it as an institution is a wholly different thing.

Wow.

(continues to read)

AHHAHAAH they even allegedly offered him $39,000 to shut up and not file any lawsuits

this gets better

Doesn't make new for profit schools look so hot.

Originally Posted by rxlea

Doesn't make new for profit schools look so hot.

Sure, if one proprietary school has issues, they all must.

Originally Posted by All4MyDaughter

Sure, if one proprietary school has issues, they all must.

Not at all. But after the St. Joseph's delay, Midway fiasco, and now this... just sayin'.

But a for profit college having financial issues like this does not look good considering the fraudulent charges against for profit colleges in general (not just pharmacy schools). Hey, what do I know? I am just a lowly student with a stupid opinion.

Oh...my...goodness!! This reminds me of the Hawaii College of Pharmacy mess

If what is alleged is true, it's curtains for CNCP; there are six other programs in CA who are sending this link to ACPE (and, likely the DOJ) on Monday.

Mark my words: if this is true, this will not end well.

Should make for some interesting chatter at AACP in July...

Originally Posted by rxlea

Not at all. But after the St. Joseph's delay, Midway fiasco, and now this... just sayin'.

St Joe's and Midway are NOT for profits.

Originally Posted by 297point1

St Joe's and Midway are NOT for profits.

I know. new schools they are, though.

It just doesn't make it look good for pharmacy is all I'm saying. My opinion. And clearly other people feel similarly judging by how many preceptors and educators I've heard saying they don't want to precept students from newer schools. I don't want to turn this thread into a new school vs. whatever debate., though. I'm just pointing out recent events and all lumped together, it doesn't look good.

Originally Posted by rxlea

Not at all. But after the St. Joseph's delay, Midway fiasco, and now this... just sayin'.

But a for profit college having financial issues like this does not look good considering the fraudulent charges against for profit colleges in general (not just pharmacy schools). Hey, what do I know? I am just a lowly student with a stupid opinion.

As someone pointed out, St. Joe's and Midway are non-profits. So could we generalize and say that all non-profit pharmacy schools are bad? No.

A pharmacy professor from UGA was involved in some VERY shady stuff a few years ago that resulted in the NAPLEX being suspended for a time... we don't view that as an indictment against all public, state-supported pharmacy schools, do we?

I don't think there are even that many proprietary pharmacy schools. Fewer than five, I think. The two I'm most familiar with are doing very well.

There are new schools that struggle, to be sure. But there are also established schools that are consistently bottom of the barrel on NAPLEX scores and have recurrent issues with maintaining accreditation and retaining faculty.

My point is that generalizations aren't that useful. Or accurate.

Great. Thanks for your input.

Originally Posted by rxlea

Great. Thanks for your input.

How on Earth is CNCP a Delaware LLC? Does that mean that Delaware has a college of Pharmacy after all?

Originally Posted by bacillus1

How on Earth is CNCP a Delaware LLC? Does that mean that Delaware has a college of Pharmacy after all?

Lots of companies/organizations charter in Delaware because of favorable business laws.

http://en.wikipedia.org/wiki/Delawar...orporation_Law

Originally Posted by All4MyDaughter

Lots of companies/organizations charter in Delaware because of favorable business laws.

http://en.wikipedia.org/wiki/Delawar...orporation_Law

Yep, I'm relatively familiar with large companies having small offices in DE just for that purpose. Keeps our unemployment rate down. But CNCP isn't exactly a large company.

Originally Posted by All4MyDaughter

You don't have to be a large company to benefit from being a DE LLC...plus it's California, there's practically no cost difference since you have to pay the $800 LLC registration fee + taxes regardless of where you incorporate.

Anyone know the parent company of CNCP? Hard to believe a school is org'd as a pass thru entity only.

Back to topic.... CNCP was a whole year behind in moving to the next step of accreditation in the first place. Of all the schools that opened in 2008, it lagged the most.

Anyone know their internal match rate %?

Hey check out all the people they hired from overseas with H1B visas:

http://www.h1bwage.com/employer.php?q=12741&sortby=2

I hope everything turns out okay for CNCP, there's a lot of friendly and smart people that go there

Interesting.

Sent from my PC36100

They'll settle out of court, CNCP will pay a bunch of money, and tuition will go up.

Originally Posted by confettiflyer

They'll settle out of court, CNCP will pay a bunch of money, and tuition will go up.

Let's bet a pale ale on it. Midyear.

I'm really not surprised. Corruption can be found at all levels and companies which are required to put profits first are more susceptible to it than most. I grew up trusting the government and police. My family taught me that such institutions were there for the good and that our system of government was setup in such a way to minimize corruption. Older and wiser I know that you can never get away from it. That applies to pharmacy school just as much as it does to the .GOV as far as I can tell.

Originally Posted by rxlea

Let's bet a pale ale on it. Midyear.

Pff, if you mean midyear 2013 i'm game, because this is going to sit on someone's desk for months.

or we can just get a beer regardless

Is this the work around where the CNCP students did a online MBA so they would qualify for federal loans?

edit: Just read the lawsuit and its mentioned in it. I didn't know the school actually had recruiters from the online MBA come to their campus to enroll more students so they could divert their federal loans towards their pharmacy tuition.

Originally Posted by 30Percent

Is this the work around where the CNCP students did a online MBA so they would qualify for federal loans?

Yup, that is correct. While ingenious, it technically violated the terms of the federal loan by using funds to pay for a non-regionally accredited school.

Granted, students use loan funds on questionable things all the time...the difference here is that an actual school promoted it and even went so far as to invite recruiters on campus from the other institution.

Wouldn't be surprised if the other school got investigated as well.

I wonder how many CNCP students are enrolled in the online MBA.

Originally Posted by 30Percent

I wonder how many CNCP students are enrolled in the online MBA.

Forget that, I wonder if anyone forwarded this pending lawsuit to ACPE and WASC yet!

I want to put on the record that no official from the school has ever encouraged students to use the mba program as a means of paying for school.

Originally Posted by desertraichu

I want to put on the record that no official from the school has ever encouraged students to use the mba program as a means of paying for school.

That's not what the lawsuit alleges, you should probably write an amicus brief if you think that way.

Originally Posted by confettiflyer

That's not what the lawsuit alleges, you should probably write an amicus brief if you think that way.

Thanks confetti, I will if it comes to that. I hope everyone here realizes that the students and faculty at the school have been amazing and this lawsuit doesn't involve them. Whatever happens, I hope you guys can accept us as pharmacy students and hope from some smooth sailing for us after these crazy rough waters.

Actually I wouldn't be surprised if current/former students are subpoenaed if this does make it to trial. Mind you that you'd be under oath in federal court, and while a school may not have explicitly told you to use funds a certain way, actions can be construed a certain way and an clever attorney can easily illustrate this if the second school in question DID appear on campus.

Good students/faculty don't override the legal complaint presented. Remember, OJ Simpson was considered a really really nice guy.

Just curious confetti, do you have any law background? your feedback is really good.

Originally Posted by desertraichu

Just curious confetti, do you have any law background? your feedback is really good.

Informal at best, my background is in intellectual property and a good chunk of my knowledge was picked up while working in the legal department of a startup internet company.

And by legal department I'm talking 2 assistants and the CEO's lawyer friend fresh out of school with a lot of downtime/reading in an area the size of the broom closet. As such, we did most of our work at Starbucks.

You'd be surprised what you pick up just from reading things.

As a side note my old company was based out of the Caribbean and incorporated in Delaware and the legal team and i were hired/paid through this separate subsidiary that was "hired" to consult even though we were all in the same space. One day I got a cryptic call to not come to work and come to the owner's house...turns out they were getting sued and wanted to avoid getting served.

And another side note: stupid district court didn't activate my PACER account, trying to check in to see if there's been any movement with the lawsuit.

haha okay got my log in right after I posted that

No new documents since the 5/7/12 filing. There were additional documents as follows:

1) Summons for CNCP, LLC
2) Pre-trial hearing is set for 9/17/12 at 2pm in courtroom 5

The judge is requiring CNCP, LLC to disclose its parent company and any entity owning > 10% of the university. Failure to do so will result in sanctions...woohoo, so we'll get to figure out who owns this place.

Guess it will be some time before things begin to pan out.

Originally Posted by confettiflyer

haha okay got my log in right after I posted that

No new documents since the 5/7/12 filing. There were additional documents as follows:

1) Summons for CNCP, LLC
2) Pre-trial hearing is set for 9/17/12 at 2pm in courtroom 5

The judge is requiring CNCP, LLC to disclose its parent company and any entity owning > 10% of the university. Failure to do so will result in sanctions...woohoo, so we'll get to figure out who owns this place.

Thanks, very interesting.

Any way you can share those documents?

Originally Posted by UCSD2012

Thanks, very interesting.

Any way you can share those documents?

They're not very interesting, I'll get to it later (was just instructions from the court to show up in september).

oh and from the other thread:


HOLY CRAP the seat deposit at CNCP is $5000

FIVE THOUSAND DOLLARS??!?!?

Originally Posted by confettiflyer

They're not very interesting, I'll get to it later (was just instructions from the court to show up in september).

oh and from the other thread:


HOLY CRAP the seat deposit at CNCP is $5000

FIVE THOUSAND DOLLARS??!?!?

They're going to need all the money they can get

Originally Posted by rxlea

They're going to need all the money they can get

Haha, they want to make it as painful as possible when another school comes calling you off the waitlist. I think their goal is to make you think twice about leaving $5k on the table, and if you play the #'s game, CNCP will win out a good chunk of the time.

Effective but brutal way to keep the # of defections down. It's like North Korea threatening to kill your family if you cross the border and defect.

Originally Posted by confettiflyer

They're not very interesting, I'll get to it later (was just instructions from the court to show up in september).

oh and from the other thread:

HOLY CRAP the seat deposit at CNCP is $5000

FIVE THOUSAND DOLLARS??!?!?

DANG! I have never seen a deposit that high in my life. The max I have seen is around $500. I paid no deposit for the school I am currently going to.

Originally Posted by ACE Rx

DANG! I have never seen a deposit that high in my life. The max I have seen is around $500. I paid no deposit for the school I am currently going to.

Hmm well Touro asks for 3,000 total (2,000 within 2 week and 1,000 followup). Although Touro used to only require 1,500 to keep a seat years ago. Things are changing certainly. But I agree with you, it really is A LOT of money. It is so important for future applicants to remember to save up money because I believe things will only get worse as fees continue to increase.

I understand though, they probably got burned by students dropping them web any other school pulled them off the WL. CNCP is probably subject to more of these than any other school.

My deposit was $500 in 2008 for a new program. $2k was where things topped out.

There is one simple reason why the seat deposit is $5000 at CNCP wait, wait , wait for it...

"It's all 'bout the money
It's all 'bout the dum dum......"

Yep, they know there are plenty of schools out there for students to defect to, and how most students think CNCP is a back-up school. I'm sure schools like UCSF or UNC - Chapel Hill pretty much have a $0 deposit. LOL.

Anyway, I thought withholding deposits in the state of CA is illegal? I recently pre-ordered something, and even the sales representative mentioned this to me. Plus, I checked it out, and what he said was true. So how does CNCP get to legally keep the deposit? Or is that part of what the lawsuit is about?

Originally Posted by youRCC

Yep, they know there are plenty of schools out there for students to defect to, and how most students think CNCP is a back-up school. I'm sure schools like UCSF or UNC - Chapel Hill pretty much have a $0 deposit. LOL.

Anyway, I thought withholding deposits in the state of CA is illegal? I recently pre-ordered something, and even the sales representative mentioned this to me. Plus, I checked it out, and what he said was true. So how does CNCP get to legally keep the deposit? Or is that part of what the lawsuit is about?

I dont know the exact details because they did not clearly explain it but the 5,000 deposit fee will be some-what refunded to you. Not sure how much.

Originally Posted by youRCC

Yep, they know there are plenty of schools out there for students to defect to, and how most students think CNCP is a back-up school. I'm sure schools like UCSF or UNC - Chapel Hill pretty much have a $0 deposit. LOL.

Anyway, I thought withholding deposits in the state of CA is illegal? I recently pre-ordered something, and even the sales representative mentioned this to me. Plus, I checked it out, and what he said was true. So how does CNCP get to legally keep the deposit? Or is that part of what the lawsuit is about?

Correct, legally deposits are implied refundable...the school should be calling it a retainer. Biggest pet peeve of mine when someone calls it a "non-refundable deposit." I've seen defendants ordered to return non-refundable deposits for services not rendered.

No one has sued about that yet...probably because $5k is still too little to quarrel over unless maybe you go to small claims, but there might be $$ limits to that venue.

And no this lawsuit is about age discrimination primarily with a smattering of whistle blower/retaliation thrown in. I don't recall reading that the plaintiff was seeking whistle blower status which is a different avenue of tort.