Ohio sues e-school founder, leaders in bid to recoup funding
Kantele Franko | Associated Press
1:48 PM, Aug 21, 2018
6:43 PM, Aug 21, 2018
COLUMBUS, Ohio (AP) — Ohio's attorney general sued the founder and leaders of the Electronic Classroom of Tomorrow on Tuesday, aiming to recoup millions of dollars in public funding that flowed to the massive, now-defunct online school.
The lawsuit names ECOT founder William Lager as well as Altair Learning Management I Inc. and IQ Innovations LLC, his two Columbus companies that provided management and curriculum services for ECOT.
Their attorney, Karl Schneider, said Lager and the companies "look forward to finally setting the record straight regarding all of the facts, many of which have been repeatedly misstated, as well as finally being able to address the misapplication of existing law and legal theories."
The lawsuit also names five ECOT officials, alleging they're liable for improper disbursements by the e-school: a retired superintendent, treasurer, vice president for accounting, federal programs director, and a data-collection system director. It wasn't immediately clear whether they have attorneys.
The lawsuit targets Lager's profits from his companies' ECOT contracts, as well as money paid under alleged improper contracts and funding received by ECOT that wasn't justified when the state tallied student participation.
The school of 11,000-plus students was among the nation's largest virtual schools when it closed in January after the state started recouping nearly $80 million in disputed funding from the 2015-16 and 2016-17 school years. ECOT challenged the funding determination process before the Ohio Supreme Court, which ruled this month that the state had authority to calculate the school's funding using participation data, not just enrollment.
The state is still due about $62 million, Attorney General Mike DeWine said in the lawsuit.
Its filing adds fuel to political debate about ECOT and accountability in this midterm election year.
DeWine, who's also the Republican candidate for governor, promised Tuesday that he'll "continue to be aggressive in seeking to recover public funds from ECOT, its affiliates, and Mr. Lager that they improperly received."
Democrats rebuffed that as too little too late and referred back to repeated criticisms that Republicans who control the Legislature and state government accepted campaign funding from donors connected to ECOT and failed to intervene earlier.
"Because public pressure and bad headlines have backed Mike DeWine into the smallest political corner, he has only now felt it important to recover millions of stolen taxpayer dollars," said state Rep. Teresa Fedor, a Democrat from Toledo.
A former ECOT employee has alleged the school intentionally inflated attendance data to get more state money, a claim largely validated in state audit findings that have been referred to criminal investigators.