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Ivy Ridge lawsuit won't get class-action status
By BRIAN KELLY
TIMES STAFF WRITER
THURSDAY, MAY 15, 2008

OGDENSBURG — A federal judge has rejected a fellow jurist's recommendation that parents of former Academy at Ivy Ridge students be certified as a class in a lawsuit against the school for troubled teens.

Senior U.S. District Court Judge Thomas J. McAvoy on Wednesday denied class action certification for the parents and former students who claim in a $100 million lawsuit that students received "worthless" high school diplomas and credits from the school.

Judge McAvoy had ruled against class certification in April 2007, but gave the parents an opportunity to renew their motion pending results of a hearing on the matter. An evidentiary hearing was held in August, with additional oral arguments heard in January.

Following that, U.S. Magistrate Judge George H. Lowe issued a report and recommendation saying there was enough in common among the parents' and students' complaints to qualify as a class action. A district judge is not obliged to accept the magistrate judge's recommendation.

In his report, Judge Lowe cited case law supporting his recommendation, but Judge McAvoy disagreed with his analysis of a similar case, which also involved federal Racketeer Influenced and Corrupt Organizations Act and fraud claims, the parents' primary claims.

The parents claim, among other things, that they relied on information provided by Ivy Ridge regarding its academic accreditation and the school's ability to award high school diplomas when making the decision to send their children there.

Judge McAvoy, however, found that "it appears that in nearly all, if not all, circumstances there were multiple reasons for sending children to Ivy Ridge." Included among the reasons he cited were geographic location, cost, extracurricular activities, educational programming and character development programs, as well as the ability to earn credits and obtain a diploma.

"It seems no parents sent their children to Ivy Ridge solely because of its ability to issue credits or a diploma, but because of Ivy Ridge's claimed ability to deal with troubled or difficult children," the judge wrote in his decision.

While the parents wanted class certification for all parents who had sent their children to Ivy Ridge between November 2001 and August 2005, Judge McAvoy found that some parents received no representation concerning the school's ability to award credits or diplomas.

He said "individualized proof" is needed to overcome the possibility that a parent sent his child to the school for any reason other than its ability to award credits or diplomas. He said the court could not assume that all parents relied on alleged misinformation when making the decision to enroll their child at the school.

He also said potential damages would vary for each parent or child based on different tuition rates that were charged for different students.

"Out-of-pocket losses cannot be shown by common evidence because they constitute an inherently individual inquiry," Judge McAvoy wrote. "Parents would have incurred different losses depending on what they would have opted to do but for defendant's misrepresentations."

He ruled that severing various elements of the parents' claims for class-action adjudication, while leaving the remainder of the claims for individualized adjudication, "would not meaningfully reduce the range of issues in dispute and promote judicial economy" and would lead to confusion and redundancy in the presentation of proof at trial.

The judge said that although class certification is not warranted in the case, "Most, if not all, of the common issues in this case can be resolved just as expeditiously through joinder," which would allow common issues of fact or law to be heard as if part of a single case, but could allow for separate trials and potentially varying damage awards.

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