martin v uhs FAC

<body topmargin=0 leftmargin=0 marginheight=0 marginwidth=0> <table cellpadding=0 cellspacing=0 border=0><tr> <td valign="top" colspan=2 height=100 BGCOLOR="#006699" TEXT="#080000" bgproperties="fixed" background="08478783.jpg"> <div> LAW OFFICES OF MICHAEL S. SORGEN<FONT SIZE="5" COLOR="#660000" FACE="Korinna BT" >   </FONT>   </div> <div> 240 Stockton Street, 9th Floor, San Francisco, CA  94108</div> <div> Tel: (415) 956-1360    Fax: (415) 956-6342    Email: msorgen@sorgen.net</div> <bR> <bR> <div> </div> </td> </tr><tr> <td valign="top" width=20% BGCOLOR="#FFCC66" TEXT="#080000" background="08478783.jpg"> <div> Home</div> <div> Practice Areas</div> <div> Attorneys</div> <div> Representative</div> <div> Cases</div> <bR> <div> Prospective Client</div> <div> Questionnnaire</div> <div> Links</div> <bR> <div> Employment</div> <div> Contact Us   </div> <bR> </td> <td valign="top" height=380 BGCOLOR="#FFFFFF" TEXT="#080000" bgproperties="fixed" background="08982823.jpg"> <div> Michael S. Sorgen (SBN 43107) <A NAME="martin_v_uhs_fac_1"><IMG BORDER="0" SRC="1x1.gif" HEIGHT="1" ALIGN="bottom" WIDTH="1" HSPACE="0" VSPACE="0" ></A></div> <div> Joyce Kawahata (SBN 113159)</div> <div> Brendan P. White (SBN 264640)</div> <div> LAW OFFICES OF MICHAEL S. SORGEN</div> <div> 240 Stockton Street, Ninth Floor</div> <div> San Francisco, CA 94108</div> <div> (415) 956-1360</div> <bR> <div> Attorneys for Plaintiff</div> <bR> <bR> <DIV ALIGN="LEFT"></DIV> <div> SUPERIOR COURT OF CALIFORNIA</div> <bR> <div> IN THE COUNTY OF SACRAMENTO</div> <bR> <bR> <div> <TABLE BORDER="2" CELLPADDING="1" CELLSPACING="1" WIDTH="629" BORDERCOLORLIGHT="#C0C0C0" BORDERCOLORDARK="#808080" FRAME="BELOW" RULES="ALL" ALIGN="BOTTOM" HSPACE="0" VSPACE="0" > <tR> <tD VALIGN=TOP HEIGHT= 321 WIDTH="310"><div> ANTHONY MARTIN, by and through his guardian ad litem CAROL HOPKINS, NICOLA PARR, JASON BRADLEY, and JESSICA NEU-HELMS</div> <bR> <div>           Plaintiffs,</div> <bR> <div>      v.</div> <bR> <div> UHS OF DELAWARE, INC. WHICH WILL TRANSACT BUSINESS IN CALIF. AS UNIVERSAL HEALTH SERVICES OF DELAWARE, INC.; ELMIRA NPS, LLC and DOES 1-10</div> <bR> <div> Defendants.</div> <bR> </tD> <tD VALIGN=TOP WIDTH="310"><div> Case No: 34-2009-044335</div> <bR> <div> FIRST AMENDED COMPLAINT FOR FALSE  CLAIMS AND UNLAWFUL, FRAUDULENT AND UNFAIR BUSINESS PRACTICES</div> <bR> <bR> </tD> </tR> <tR> <tD VALIGN=TOP HEIGHT= 19 WIDTH="310"><IMG BORDER="0" SRC="1x1.gif" HEIGHT="19" ALIGN="bottom" WIDTH="310" HSPACE="0" VSPACE="0"></tD> <tD VALIGN=TOP WIDTH="310"><IMG BORDER="0" SRC="1x1.gif" HEIGHT="19" ALIGN="bottom" WIDTH="310" HSPACE="0" VSPACE="0"></tD> </tR> </TABLE></div> <bR> <DIV ALIGN="LEFT"></DIV> <div> <B>INTRODUCTION</B></div> <bR> <div> 1.  This is an action for false claims and unfair business practices brought by students, parents or guardians, and past employees who are or were formerly enrolled in or worked at California schools operated by or in conjunction with UNIVERSAL HEALTH SERVICES OF DELAWARE WHICH SHALL CONDUCT BUSINESS IN CALIF. AS UHS OF DELAWARE INC (UHS). One such school is ELMIRA NPS LLC (ELMIRA), whose conduct also forms a significant basis for this suit.</div> <bR> <div> 2.  UHS and ELMIRA have engaged in a practice of defrauding children, parents, local educational entities and the State by collecting annually substantial educational funds to run schools and programs for students with disabilities, but without providing the qualified instruction and related services for which the funds were intended and by overcharging for those services they do provide.  Defendants' practices bilk the California public school system and taxpayers of funds earmarked for special education.  UHS and its alter egos collect and keep the funds while leaving students to fend for themselves in unsafe classrooms operated largely by unqualified personnel.</div> <bR> <div> 3.  The Court has jurisdiction over Plaintiffs' claims because the acts and omissions complained of occurred at school sites owned and/or operated by defendants in California.  Venue is proper in Sacramento County because UHS owns and/or operates at least one school in Sacramento County and because at least one plaintiff resides in said county.  While defendant UHS does business in the State of California, it has not designated with the California Secretary of State a principal place of business within the State pursuant to Corporations Code ¤ 2105(a)(3). Accordingly, UHS may be sued in any county in the State, including the County of Sacramento.</div> <bR> <DIV ALIGN="LEFT"></DIV> <div> <B>P</B><B>ARTIES</B></div> <bR> <div> 4.  Plaintiff Anthony MARTIN, date of birth March 20, 1996, was enrolled for several years as a student at defendants' school ELMIRA, including the 2004-2005, 2005-2006, and 2006-2007 school years, where he was supposed to, but did not receive, appropriate education and related services.  He sues by his guardian ad litem, Carol HOPKINS.</div> <bR> <div> 5.  Plaintiff Nicola PARR served during the 2005-2006 school year as Vice Principal for Instruction at defendants' ELMIRA school.  Plaintiff Jason BRADLEY is and was at all relevant times a resident of Sacramento County. From approximately 2001 until 2006, BRADLEY was a counselor and Clinical Director of Behavioral Services at the Carmichael school operated by UHS and at the ELMIRA school.  Plaintiff Jessica NEU-HELMS served as an educational aide and in related positions at ELMIRA school from roughly October 2005 to July 2007.  All of the <I>Qui tam</I> plaintiffs, as former employees of defendants, have first hand knowledge of the fraudulent, unlawful, and unfair educational policies, practices, and activities detailed below.</div> <bR> <div> 6.  Defendant UHS is a Delaware Corporation with its principal place of business in Pennsylvania, that owns, controls and/or manages a number of local corporate subsidiaries which function as the titular owners or operators of around a dozen non-public schools, agencies or programs licensed by the California Department of Education to provide special educational services to public school students with disabilities. At various times since at least 2005, UHS has substantially participated in operating a number of these schools in California, which were to serve over 500 students with disabilities. </div> <bR> <div> 7.  ELMIRA, a California corporation with its principal place of business in Solano County, is a wholly owned subsidiary of UHS, which directs its daily affairs and manages its business dealings. ELMIRA is one example of the type of corporate shell employed by UHS in its fraudulent dealings with the State, its political subdivisions and the local educational entities. ELMIRA is either an agent or alter ego of UHS.</div> <bR> <div> 8.  Plaintiffs do not know the true names and capacities of Defendants sued herein as DOES 1-10 and therefore sue these Defendants by such fictitious names. Plaintiffs will amend this Complaint to allege their true identity and capacities when ascertained. Plaintiffs are informed and believe and on that basis allege that each of these fictitiously named Defendants is responsible in some manner for the occurrences alleged herein and thereby proximately caused Plaintiffs' injuries alleged herein.</div> <bR> <div> 9.  Plaintiffs are informed and believe and on that basis allege that at all relevant times each of the Defendants was the agent or employee of each of the remaining Defendants, and in doing the things herein alleged was acting within the course and scope of such agency or employment, and that Defendants authorized ratified, and approved, expressly or implicitly, all of the conduct herein alleged.</div> <bR> <DIV ALIGN="LEFT"></DIV> <div> <B>FACTUAL BACKGROUND</B></div> <div> 10.  The right of all children with disabilities to free, appropriate, public education in the least restrictive environment is guaranteed by the Individuals with Disabilities Education Act, 20 U.S.C. §1400 <I>et seq.</I>, and its California analog, California Education Code § 56000 <I>et seq.</I> Together, these laws and their implementing regulations, reflect a body of legislative findings, policy judgments and goals, which have at their aspirational core the full participation in society of people with disabilities. To effectuate these goals, the laws and regulations prescribe basic conditions and requirements for the education of children with disabilities and/or exceptional educational needs.</div> <bR> <div> 11.  Every such child receives an Individualized Education Program (“IEP”), which states the child's present level of educational functioning and articulates both measurable annual goals and benchmarks or short-term objectives. <I>See </I>34 C.F.R §§ 300.343 (c) - 300.347(a);<I> </I>20 U.S.C. §§ 1401 (A)(12), 1414 (D)(1)(A) and (d)(6)(A)(ii). The IEP is developed by the child's parents and a team of educational professionals, and it is reviewed and/or modified at least annually. The IEP further specifies the related services each student with exceptional needs requires in order to gain meaningful access to the curriculum and to assure educational progress.</div> <bR> <div> 12.  Pursuant to Cal. Ed. Code § 56195.1, each Local Educational Agency (“LEA”)  must designate a Local Plan Area “to assure access to special education and services for all individuals with exceptional needs residing in the geographic area served by the plan.” These Special Education Local Plan Areas are known by the acronym SELPA.  They are the administrative body responsible for coordinating special education services.</div> <bR> <div> 13.  According to California Education Code § 56034, a “nonpublic, nonsectarian school' (“NPS”) may be certified by the State to enroll individual students with exceptional needs and to implement the IEP.  The NPS that enrolls individuals with exceptional needs pursuant to an IEP must employ at least one full-time teacher who holds an appropriate credential authorizing special education services and who must be certified by the California Department of Education.” Cal. Admin. Code tit. 2, § 60010 (o).</div> <bR> <div> 14.  Through the SELPA, an LEA may contract to place a student with an NPS if there is no public school able to provide the services as defined in the student's IEP. <I>See</I> Cal. Ed. Code § 56365 (a).</div> <bR> <div> 15.  Pursuant to Cal Ed. Code §§ 56365, 56356 and  Cal. Admin. Code (CAC) § 3062, the LEA through its SELPA must use a `master contract' to enter into such formal agreements with a certified NPS. These master contracts indicate the related services the NPS will provide and payment amounts for each contracted service, as well as provisions specifying the NPS' responsibilities for attendance and unexcused student absences.</div> <bR> <div> 16.  NPS teachers must be licensed by the California Department of Education's Commission on Teacher Credentialing (Commission) to provide special education instruction. Each NPS must furnish to the contracting LEA a list of its staff and copies of current licenses and it must update that list within forty-five (45) days of any change in staff or credential.</div> <bR> <div> 17.  Each NPS must also provide qualified substitute teachers consistent with Ed. Code § 56061, which requires substitutes to hold a valid credential. The minimum qualifications for a substitute teacher credential are a bachelor's degree, a satisfactorily completed application to the Commission, and a passing score on the California Basic Educational Skills Test (CBEST).</div> <bR> <div> 18.   Cal. Ed. Code § 56836.20(a)(9), prohibits payments to any NPS for services provided by personnel who do not meet State-mandated minimum requirements.  According to Cal. Admin. Code § 3065, to be eligible for certification to provide designated instruction and services for individuals with exceptional needs, an NPS must provide personnel who possess a credential that authorizes service in the particular area of expertise. For instance, adapted physical education shall be provided only by personnel who possess a credential that authorizes service in adapted physical education (§3065 (a)(2)). If an NPS does not provide qualified personnel it has not rendered the designated service or instruction and may not receive payment for that service or instruction under the terms of the master contract.</div> <bR> <div> 19.  Pursuant to Cal. Ed. Code § 56366.10, an NPS must further certify in writing that it will not accept children with exceptional needs if it cannot provide or ensure the provision of the services outlined in the pupil's IEP and that the pupil will have access to a variety of educationally necessary materials, services and programs, as elaborated by statute and regulation. </div> <bR> <div> 20.  Since October 2005, UHS, a Fortune 500 Company, has owned and/or operated for-profit NPS under various trade names, including `Keystone Schools' and `UHS Schools'.  There have been at least fifteen such NPSs, located in Carmichael, Cotati, Elmira, Grand Terrace, Hemet, Morongo Valley, Rancho Cucamonga, Riverside, San Rafael, Santa Rosa, Steele Canyon, Vallejo, Ventura, and Victorville.  In total, these NPSs purported to serve hundreds of children with disabilities, who represented a valuable and lucrative income stream for UHS.</div> <bR> <div> 21.  Although it separately incorporated a couple of schools, such as ELMIRA, UHS operated these NPSs as a single, profit generating enterprise. Every UHS California NPS was under the direct supervision of a single UHS Regional Vice President, Betti Colucci, who answered directly to UHS executive officers in King of Prussia, Pennsylvania. In addition to Ms. Colucci, UHS put in place  centralized personnel and business departments in order to direct the daily operations of the different schools. UHS staff wore uniforms and personnel regularly transferred from one NPS to another as needed. UHS advertised its services to parents and LEAs on a single webpage, www.uhsschools.com. </div> <bR> <div> 22.  UHS or its agents entered into and generally renewed on an annual basis master contracts with various SELPAs by which the NPSs were to provide instruction and related services to children with disabilities or exceptional needs.  UHS' public counterparties included the Solano County, San Bernardino County, Napa County, Riverside County, Sacramento County, and Imperial County SELPAs, among others (hereinafter referred to collectively as `SELPAs'). Pursuant to the terms of the master contract with these and other entities, UHS was to provide qualified teachers and substitutes licensed to teach special education students, as well as other qualified personnel to render the related services specified in each student's IEP. The master contracts referred to and incorporated the aforementioned state regulations regarding the qualifications of educational staff. For example, the 2007-2008 Master Contract between the Solano County SELPA and UHS, Contract Number 149, at paragraph 47, expressly required UHS to “ensure that all individuals employed, contracted, and/or otherwise hired by [UHS] to provide classroom and/or individualized instruction or related services hold a license, certificate, permit or other document equivalent to that which staff in a public school are required to hold in the service rendered consistent with Education Code section 56366.1(n)(1) and are qualified pursuant to Title 5 of the California Code of Regulations sections 3001(y), 3064 and 3065.” UHS represented to the SELPAs, parents and students that it would provide these qualified professionals. As with all the master contracts, Betti Colucci, Regional Vice President of UHS, endorsed the 2007-2008 Master Contract with the Solano County SELPA and thereby affirmed UHS' commitment to comply with its terms.</div> <bR> <div> 23.  UHS agreed to provide mental health services to children diagnosed as emotionally disturbed, in accordance with the IEPs. It represented to the various County Mental Health authorities, SELPAs, parents and students that it would provide licensed mental health workers.</div> <bR> <div> 24.  UHS was obligated to accurately record the daily attendance of each student and to transport each student to and from the NPS.  Each master contract specified a per diem payment for each student in attendance, as well as additional sums for each related service, mental health service and for transportation. These sums were owed only if UHS provided qualified personnel and services. For instance, the aforementioned 2007-2008 Master Contract between UHS and the Solano County SELPA, at paragraph 49, expressly predicated payment on UHS' ability to provide qualified personnel.</div> <bR> <div> 25.  The master contracts expressly conditioned payment on UHS' compliance with the contract's terms and conditions. For instance, the aforementioned 2007-2008 Master Contract between UHS and the Solano County SELPA, at paragraph 57 among other provisions, required UHS to “verify the accuracy of minutes of reported attendance that [was] the basis of  services being billed for payment.” In addition, pursuant to paragraph 22, UHS expressly agreed it would not accept a student if it could not provide or ensure the provision of services outline in the operative IEP. Pursuant to paragraph 58, the Solano County SELPA had the right to withhold payment to UHS when UHS “failed to perform, in whole or in part, under the terms of this contract.” </div> <bR> <div> 26.  By accepting students as well as presenting its invoices and claims for payment, UHS falsely represented and certified to the SELPAs that it had complied with all the material provisions of the operative master contracts and with state laws. Because the master contracts expressly conditioned payment on compliance, these certifications and representations were material to the SELPAs' decision to honor UHS' invoices.</div> <bR> <div> 27.  Through its Regional Vice President, Betti Colucci, UHS submitted monthly invoices for payment to the various LEAs and SELPAs with which it contracted, but it did not always in fact provide qualified teachers or substitutes.</div> <bR> <div> 28.  Instead, UHS knowingly and intentionally left various unqualified assistants and aides to manage many classrooms, for weeks or even months at a time. At no time did UHS maintain a list of qualified substitute teachers, rather it relied exclusively and unlawfully on its non-credentialed staff to fill in for absent teachers. For example, UHS permitted its non-credentialed Education Assistants, including Jessica Neu-Helms, to manage classrooms alone when, in the spring of 2006, several of the teachers at UHS ELMIRA, including Jessica Mallo, were absent for protracted periods. Betti Colucci, Vice President of UHS, instructed Nicola Parr and Jason Bradley, UHS Schools administrators, to use any and all available non-certificated staff to cover for absent teachers.  </div> <bR> <div> 29.  UHS falsely claimed in various documents submitted to the LEAs, SELPAs, and officials with the Department of Education that its classrooms were staffed by qualified teachers. In fact, UHS resorted in almost every case to the use of non-credentialed staff like LaMont Francies, Ryan Adams, Carolynne Bottum, Jessica Mallo and Jasmeen Kaur. </div> <bR> <div> 30.  Because it had too few teachers with the legally required credentials, UHS would use one credentialed teacher to `cover' several classrooms. For example, as documented by the Department of Education's January 2006 site evaluation, UHS claimed that its certificated employee, Renee Hensley, taught at its Vallejo facility when in fact she taught at ELMIRA. Betti Colucci, Vice-President of UHS, not only falsified records, she transferred Renee Hensley to Vallejo for the day of the site visit, placed her in a classroom with students she had never before taught, and required Ms. Hensley to lie to the State's evaluators. This type of ruse was a standard method by which UHS actively and intentionally deceived government officials and evaded efforts to supervise its compliance with the applicable laws.</div> <bR> <div> 31.  UHS did not provide the materials, services and programs, as it had contracted and as it was obligated by law to provide. For instance, UHS did not provide (a) standards-based, core curriculum and the same instructional materials used by the public schools; (b) college preparation courses; (c) extracurricular activities, such as art, sports, music and academic clubs; (d) career preparation and vocational training, consistent with transition plans pursuant to state and federal laws or; (e) supplemental assistance, including academic tutoring, psychological counseling, and career and college counseling.</div> <bR> <div> 32.  UHS did not provide qualified speech therapists, occupational therapists, assistive technology instructors, adaptive physical education instructors, or any of the other professionals holding the necessary certificates and credentials.  Nor did UHS provide qualified mental health professionals as required by the master contract. Also in violation of law and of its Master Contracts, UHS personnel subjected disabled children to improper restraint, including placing them in seclusion, and utilized other inappropriate disciplinary methods.</div> <bR> <div> 33.  As a student at a UHS school, Anthony MARTIN was a victim of Defendants' fraudulent and unlawful practices. During his time in UHS' ELMIRA school, he was placed in classrooms without qualified teachers or substitutes and was denied related services mandated by his IEP, including adaptive physical education, occupational therapy, and speech and language therapy, either because UHS simply did not render the services or because it had no personnel on staff qualified to provide the services.</div> <bR> <div> 34.  UHS did not keep accurate daily attendance records for students. It often reported students as present who were not. For instance, UHS had a practice of counting as `present' any student who set foot in one of its transport vans or campuses, whether or not that student remained at school or received educational or related services. Thus, UHS billed the various LEAs and SELPAs for the full amount for each student under the contract, whether or not the child attended school.  Thus, itUHS deceived the SELPAs and other public school officials with false attendance reports.</div> <bR> <div> 35.  UHS billed the LEAs and/ or SELPAs for:</div> <bR> <div> a.  transportation services, whether or not the child actually attended school;</div> <div> b.  instructional services, whether or not it staffed its classrooms with qualified teachers or substitutes;</div> <div> c.  mental health services, whether or not it actually provided qualified mental health workers;</div> <div> d.  various related services, whether or not it provided qualified professional personnel.</div> <bR> <div> UHS billed the LEAs and/or SELPAs as if it had provided the necessary materials, services and programs it was contractually obligated to provide.</div> <bR> <div> 36.  UHS managers, specifically Betti Colucci and her immediate subordinates, required and directed teachers, administrators and clerical employees to falsify the various records submitted with the invoices to the LEAs and/or SELPAs. UHS encouraged this practice of billing the LEAs and/or SELPAs for services it never provided and for students who never attended school.  By submitting these invoices, UHS knowingly misrepresented to the LEAs and/or SELPAs the services it provided. These claims for payment were materially false and by accepting payment for services it did not provide, UHS defrauded the LEAs, SELPAs and the STATE.</div> <bR> <DIV ALIGN="LEFT"></DIV> <div> <B>FIRST CAUSE OF ACTION</B></div> <bR> <div> <B>For Violation of the False Claims Act, Government Code Section 12650 </B><I><B>et seq</B></I><B>. brought on behalf of the STATE OF CALIFORNIA against Defendants UHS and ELMIRA</B></div> <bR> <div>      Plaintiffs hereby incorporate by reference paragraphs 1 through 36, inclusive, as though set forth here in full.</div> <bR> <div> <I>37.  Qui tam</I> plaintiffs bring this cause of action on behalf of the STATE OF CALIFORNIA and its political subdivisions pursuant to Government Code Section 12651(a) and allege that UHS, ELMIRA, their agents and their affiliates, knowingly and intentionally requested reimbursement from the STATE OF CALIFORNIA through the various LEAs, county offices of education and/or SELPAs and other political subdivisions with which the defendants contracted, for students they falsely claimed were in attendance and receiving qualified educational instruction, services and supplies, all the while knowing that they had not complied with the material terms of the master contracts, and that the ADA and other records invoices they submitted did not accurately reflect:</div> <bR> <div> a.  the students attending and actually receiving instruction, educational materials or related services from their schools on the dates represented, or </div> <div> b.  the fact that the UHS personnel were unqualified under the law and the terms of the operative Master Contracts to provide the services for which it billed </div> <bR> <div> 38.     Defendants requested payment for services not authorized under the operative IEP, or not actually provided to the student. The defendants never disclosed that they had failed to comply with the material terms of the master contracts. Rather, by submitting claims for payment, the defendants impliedly and falsely certified their compliance. Based on the defendants' false certifications of compliance, the LEAs, county offices of education and/or SELPAs and other political subdivisions made payments to the defendants.</div> <bR> <div> 39.     As a direct and proximate result of these actions, the STATE and the taxpayers have been deprived of funds wrongfully collected by defendants, in an amount according to proof.</div> <bR> <div> 40.     The False Claims Act provides that a person in violation of the Act shall be liable to the STATE or to the affected political subdivision for three times the damages sustained.  The Court may also award a civil penalty of up to $10,000 for each false claim.  Qui tam plaintiffs seek such recovery and all remedies allowed by statute on behalf of the STATE OF CALIFORNIA and its political subdivisions.</div> <bR> <div> 41.     As a further direct and proximate result of defendants' conduct, plaintiffs have been compelled to retain attorneys, and have and will continue to incur legal fees and costs vindicating their rights and the rights of the public.  This action enforces important civil rights affecting the public interest, and will confer a significant benefit on the general public or a large class of people.  In the interest of justice, plaintiffs should not be required to bear the financial burden of enforcement of these important rights.   Plaintiffs are entitled to attorney's fees pursuant to Government Code Section 12652(g)(8) and Code of Civil Procedure Section 1021.5.</div> <bR> <DIV ALIGN="LEFT"></DIV> <div> <B>SECOND CAUSE OF ACTION</B></div> <bR> <div> <B>For Fraudulent, Unlawful, and Unfair Business Practices - Business and Professions Code Sections 17200 </B><I><B>et seq</B></I><B>. against Defendants UHS and ELMIRA</B></div> <bR> <div>      Plaintiffs hereby incorporate by reference paragraphs 1 through 41, inclusive, as though set forth here in full.</div> <bR> <div> 42.     Plaintiff Anthony MARTIN brings this cause of action on behalf of himself and all other disabled children who enrolled in UHS California schools during the applicable time period. The other <I>Qui tam</I> plaintiffs bring this claim on behalf of the defrauded public entities and the general public. </div> <bR> <div> 43.     Defendants UHS and ELMIRA engaged in fraudulent, unlawful and unfair business acts and practices within the meaning of the Business and Professions Code Sections 17200 <I>et seq</I>.</div> <bR> <div> 44.     Defendants' acts and practices as above alleged were fraudulent in that reasonable consumers were likely to be misled or deceived by them into enrolling their children in defendants' schools in the belief that they would receive the educational instruction and related services which they had a right to receive and which said defendants falsely represented they would receive. Through these deceptive practices, defendants deprived students like A.M. of the right to a free, appropriate public education in the least restrictive environment. </div> <bR> <div> 45.     Defendants' acts and practices were unfair in that they offended public policy, were deceptive, unethical, oppressive, unscrupulous or substantially injurious to consumers, enabled said defendants to submit false claims for unearned reimbursements, and in that the harm from such acts and practices outweigh defendants' reasons, motives, and justifications, if any.</div> <bR> <div> 46.     Defendants' acts and practices were unlawful in that they violated various federal, state, local, statutory, regulatory, and/or court made laws, civil and/or criminal, including without limitation, the California Constitution, Art. IX, Section 5, Art. I, Sections 7(a) and (b), and Art. IV, Section 16(a), the Charter Schools Act of 1992, Education Code Sections 47600, <I>et seq.</I>, Education Code Section 51747.3, the False Claims Act, Civil Code Section 1710, contract law, and Code of Civil Procedure Section 526a.</div> <bR> <div> 47.     Defendants engaged in unfair, deceptive, untrue and/or misleading advertising within the meaning of Business and Professions Code Sections 17500 and 17500.3.  In doing the acts alleged herein, defendants intended directly or indirectly to induce the public entities to enter into obligations relating to educational materials and services which would enable said defendants to submit false claims for unearned reimbursements.  At the time such statements were made, defendants knew, or in the exercise of reasonable care should have known, that their statements were untrue or misleading.</div> <bR> <div> 48.     As a direct and proximate result of defendants' acts and practices, past, present, and future, plaintiffs and members of the general public have suffered and will continue to suffer irreparable harm, for which there is no adequate remedy at law and for which they are entitled to injunctive relief, and restitution as provided in Business and Professions Code sections 17203 and 17535. In particular, Anthony MARTIN and other student-victims have been denied the educational services guaranteed by state and federal laws, which injuries warrant a restitutionary award of compensatory services. Further, defendants have been unjustly enriched by their fraudulent, unfair, and unlawful practices, and should be required to pay restitution of all unearned amounts derived from or attributable to their actions and practices.  Plaintiffs are further entitled to all penalties available by law.</div> <bR> <div> 49.     As a further result of defendants' violation of the Business and Professions Code Section 17200, <I>et seq.</I>, plaintiffs have been compelled to employ attorneys to effectuate their rights and to enforce defendants' compliance with the law, which enforcement inures to the benefit of all consumers within the State.  Plaintiffs are entitled to attorneys' fees pursuant to California Code of Civil Procedure Section 1021.5.</div> <bR> <DIV ALIGN="LEFT"></DIV> <div> <B><U>PRAYER FOR RELIEF</U></B></div> <bR> <div> WHEREFORE, plaintiffs pray for relief as follows:</div> <bR> <div> 1.  Under the False Claims Act, for restitution to the STATE OF CALIFORNIA or any other appropriate public entity and to qui tam plaintiffs of all public funds wrongfully collected by defendants UHS and ELMIRA.</div> <bR> <div> 2. Under the False Claims Act, for three times the damage suffered by the STATE OF CALIFORNIA or any other appropriate entity for the defendants' wrongful collection of public funds.</div> <bR> <div> 3.  Under the False Claims Act, for civil penalties to the STATE OF CALIFORNIA or any other appropriate entity and to qui tam plaintiffs of $10,000 for each false claim made by defendants UHS and ELMIRA.</div> <bR> <div> 4.  For an order declaring that UHS and ELMIRA engaged in acts and practices which are fraudulent, unfair, or unlawful, or which constitute unfair, deceptive, untrue and/or misleading advertising under the Unfair Competition Act, and permanently enjoining defendants from engaging in such acts in the future.</div> <bR> <div>  </div> <div> 5.  For restitution of all money paid to defendants UHS and ELMIRA by plaintiffs to educate the children.</div> <bR> <div> 6.  For disgorgement by defendants UHS and ELMIRA for money wrongfully received as a result of their fraudulent, unfair or unlawful acts and practices, or as a result of their unfair, deceptive, untrue and/or misleading advertising.</div> <bR> <div> 7.  For prejudgment interest, where available.</div> <div> 8.  For reasonable attorneys' fees and costs.</div> <div> 9.  For all other just and proper relief.                              </div> <bR> <div> Dated: June 24, 2010                    LAW OFFICES OF MICHAEL S. SORGEN</div> <bR> <div> By:     _______/s/______________</div> <div>                                                                                           Michael S. Sorgen</div> <div>                                                                                           Attorneys for Plaintiffs</div> <bR> <bR> </td> </tr></table></body>