Brown Schools, Parent of CEDU, Files for Bankruptcy

I guess I was mistaken in believing that Brown had assets other than CEDU.

"This is a relationship-based program, and they closed this like it was a factory," a counselor at one of the schools told the Spokesman-Review newspaper in Spokane, Wash.

Brown Schools operate 11 boarding schools and educational facilities in Idaho, Texas, Vermont, Florida and California, according to its Web site. Facilities in Austin and San Marcos were sold to Psychiatric Solutions Inc. in 2003.

 

Brown Schools Inc. files for bankruptcy
Austin-based operator of schools for troubled youths has been targeted by regulators and private lawsuits.

By Robert Elder
AMERICAN-STATESMAN STAFF
Tuesday, March 29, 2005

The Brown Schools Inc., an Austin-based operator of schools for troubled youths whose methods have been repeatedly targeted by state regulators and private lawsuits, filed for Chapter 7 liquidation in Bankruptcy Court in Delaware.

The filing Friday lists at least $425,000 in legal settlements among its unsecured claims.

Five of the six settlements listed are for Austin-area residents, according to the bankruptcy filing. Most of the lawyers handling the settlements couldn't be reached for comment late Monday.

Brown Schools didn't say why it filed for liquidation. It operates 11 boarding schools and educational facilities for troubled children in Texas, Idaho, California, Florida and Vermont, according to its Web site.

The schools were the subject of a series of Austin American-Statesman stories in 2003, which detailed the use of improper physical restraints at the centers and other questionable techniques and lax regulation by state authorities.

Texas regulators cited the On Track program of the Brown Schools for multiple violations after the 2002 death of 17-year-old Chase Moody of Richardson. Regulators alleged that an improper restraint was used at the Mason County program, although a grand jury later concluded that no criminal charges were warranted.

Brown Schools filed for liquidation along with 24 affiliates. It reported assets of less than $10 million and debt between $10 million and $50 million.

Winstead, Sechrest & Minick, a Dallas-based law firm with a major office in Austin, is listed as the third-largest unsecured creditor. The firm is owed $324,496, according to the filing.

Shareholder Bill Sechrest didn't return a phone call for comment. The firm had served as general counsel for Brown Schools.

The filing lists claims by numerous other lawyers, including prominent Austin litigator Roy Minton ($55,995) and the Austin office of Fulbright & Jaworski ($23,713).

The company listed food services vendor Aramark Management Services Ltd. as its largest unsecured creditor, with a claim of $1.5 million.

The filing doesn't say who currently owns the Brown Schools. Until recently, Menlo Park, Calif., investment firm McCown, De Leeuw & Co. owned Brown Schools and its unit, CEDU School Inc.

Brown Schools scaled back in 2003, selling six in-patient facilities to Psychiatric Solutions Inc., based in Franklin, Tenn., for $63 million.

The six facilities, which had a total of 895 beds, included units Austin, San Marcos and San Antonio.

The sale price was seen as a sign of distress for the Brown Schools because the six facilities brought in revenue estimated at $76 million a year.

• Former CEDU Schools Reborn January 5 2007
• Update on CEDU Schools October 28 2005
• CEDU Properties Sold August 18 2005
• The Business of Troubled Teens August 18 2005
•  CEDU Closing: Buildings and Contents to be Sold May 8 2005
• CEDU Closing: On Edison Schools April 30 2005
• CEDU Closing: Pete Talbott's Resume April 27 2005
• CEDU Closing: McCown DeLeeuw Sued ByEmployees April 14 2005
• CEDU Closing: George Locker's Criticism of the CEDU Enterprise April 14 2005
• CEDU Closing: 1990 Snapshot of McCown DeLeeuw April 12 2005
• CEDU Closing: A Timeline of the CEDU Enterprise April 2005
• CEDU Closing: Letter from a Former Faculty Member April 2005
• CEDU Closing: Parents of CEDU Students Helping Economically Distressed Faculty April 7 2001
• CEDU Closing: Economic Impact on CEDU Employees Devastating April 7 2005
• CEDU Closing: 310 Employees Stiffed on Wages April  6 2005
• CEDU Closing: Who is To Blame? April 6 2005
• CEDU Closing: Running Springs Area Also Suffers Financial Impact April 6 2005
• CEDU Closing: An Alumnus Pleads, "Save CEDU!" April 4 2005
• CEDU Closing:  A Parent's Response to CEDU's Closing April 3 2005
• CEDU Closing: Bankruptcy Trustee Slams Door Shut, Then Open April 3 2005
• CEDU Closing: Parents Out Prepaid Tuition, Employees Lose Retirement. McCown Deleeuw Still Solvent April 3 2005
• CEDU Closing: King George Stays Open as Head Thinks on Feet April 3 2005
• CEDU Closing Shocks Industry Reporter April 3 2005
• CEDU Closing: Parent Company, Brown, Negotiating in Bad Faith?  April 1 2005
• CEDU Closing: More Details March 29 2005
• CEDU Closing: Brown Schools, CEDU's Parent, Files for Bankruptcy March 29 2005
• CEDU Closing: Margurite Sallee, The Brown Schools, and McCown DeLeeuw March 27 2005
• CEDU Closing: All CEDU Schools Closing Immediately March 25 2005
• CEDU Closing: Rocky Mountain Academy Folds Abruptly February 12 2005

Related Posts:

• Debunking "Tough Love" Programs April 11 2006
• Advice for Parents Seeking a Therapeutic Program for Their Children January 21, 2006
• Why The "Troubled Teen" Industry is Booming January 2, 2006
• The Road To Whatever August 25 2005
• Nonpublic School Governance April 23 2005
• Why Parents Seek and Pay for Therapeutic Boarding Schools April 14 2005
• NYT Article on the Therapeutic School Industry April 13 2005
• Therapeutic Schools: What Happens to Poor Kids April 10 2005
• Thinking of Sending Your Kid to A "Tough Love" Program?  March 30 2005

Questions Parents Should Consider Before Placing A Child

• NonPublic Schools: Part I--Overview
• NonPublic Schools--Part II Evaluating Mission, Values, & Goodness of Fit for Your Child
• NonPublic Schools--Part III Faculty and Staff Qualifications
• NonPublic Schools--Part IV: Evaluating Academic Program
• NonPublic Schools:Part V--On Accreditation
• NonPublic Schools:Part VI--More Detail on Financial Issues: IRS Status

Comments

[Dennis Wright]

Brown Schools Education Corporation sold their valuable assets to friendly buyer, because they did not want to pay wrongful death claims for children who had died while being restrained at the facilities. The director of the facility in Houston directed a hefty amount of the corporations funds towards his wife's consulting corporation which was based in Dallas. Many of the teachers and administrators working at the schools have criminal records. One of the principal's, Tracy L. Beasley aka Tracy Beasley was convicted of a violent felony and removed from HISD as a result. Those records are available from the Texas Education Agency website.

[liz]

Brown Schools Education Corporation sold their valuable assets to friendly buyer

who was the friendly buyer?

What was the year of purchase?

because they did not want to pay wrongful death claims for children who had died while being restrained at the facilities.

I don't know, I'm not a lawyer, but I don't think that selling the schools gets the corporation out from under any liability.

=============
Chase Moody died in 2002
http://www.slackdavis.com/practice_article.php/news_id/argval/74/argname/practice_area/argval/General+Negligence+Home

Charles Chase Moody is at least the fifth youth to die in Texas since 1988 after being restrained in a facility or program run by the Brown Schools. Officials for the Nashville-based company acknowledged the deaths and the fact that Moody had been placed facedown in a prone position.
-----
The first death occurred in 1988 at South Austin's Healthcare Rehabilitation Center, which has since been renamed. An 18-year-old, Brandon Hadden of East Texas, died after being restrained in a straitjacket and held facedown on a bed, according to Michael Slack of Austin, who represented Hadden's mother.

In 1990, 17-year-old Diane Harris died in the Brown Schools' Seguin Community Treatment Center after five staff members placed her into a "basket hold," in which a person's arms are crossed in front of the chest. The center has since closed.

Slack's firm, Slack & Davis LLP, also represented the family of 16-year-old Roshelle Clayborne, who died in 1997 at the Brown Schools' Laurel Ridge facility in San Antonio. According to a state report, Clayborne died of an irregular heartbeat after a violent struggle with hospital staff, during which they put her in a restraint.

in 2000, A year later, 9-year-old Randy Steele died of suffocation at the same facility after a violent outburst. Two hospital workers held the boy down, during which he vomited and began having trouble breathing, state officials said at the time. He later died.
============
here's a list of all the kids who have died in "correctional faciliteis" or "therapeutic schools"

http://mysite.verizon.net/res0g8bp/the8thstep2/id74.html

==================
The director of the facility in Houston directed a hefty amount of the corporations funds towards his wife's consulting corporation which was based in Dallas."

Name of the facility director in Houston?
Wife's Consulting Corporation?
================
http://www.strugglingteens.com/news/bsedhouston.html

The Brown Schools Will Continue to Provide Educational Services for Houston-Area
Troubled Youth

Media Contact: Howard Falkenberg
512-482-8897 (office)
512-490-5120 (pager)
hfalkenberg@brownschools.com

(May 15, 2003) Houston, TX, – The Harris County Juvenile Justice Board has voted unanimously (Monday, May 12) to award a contract to The Brown Schools Education Corporation to provide educational services to students enrolled in the Harris County Juvenile Justice Charter Schools (HC-JJCS) and the Excel Academy Juvenile Justice Alternative Education Program (JJAEP).

“We are honored to continue applying our 60 years of experience working with troubled youth to address the unique learning needs of students throughout Houston and Harris County,” said Bob Naples, acting chief executive officer of The Brown Schools.
=======================

http://sfgate.com/cgi-bin/article.cgi?file=/c/a/2005/05/08/MNG44CLV1V1.DTL
Lon's Visit: January 16-17, 1994

The Brown Schools are a group of psychiatric hospitals, residential treatment centers and community-based programs, primarily oriented to young people. Although psychiatric facilities are not the focus of this newsletter, the Brown Schools reputation is such that any professional working with young people with problems should be aware of the services they offer.

The first Brown Schools facility was established in 1940 by Mr. and Mrs. Bert P. Brown "to provide care in a loving environment for troubled youth." The founding of Brown Schools followed a pattern that has been duplicated many times since by many other successful youth schools and programs throughout the country: They brought some young people into their home to give them the help they needed. Responding to the needs of those young people, the Browns then brought in the resources the children needed.

As time went on, The Brown Schools rapidly evolved into providing clinical services, and then have spent fifty years evolving into the complex we see today. The Brown Schools staff pride themselves in having the ability, expertise and technology to treat difficult cases and to address complex psychiatric issues. Specialized programs are available to work with Neuropsychiatric Disorders, Dissociative Disorders, Sexual Abuse, Abandonment Issues, Gang-related Problems, Substance Abuse and many other issues, which are all integrated to meet the multiple needs of their patients.

I had three major impressions during my whirlwind tour of most of the facilities. First was the environment, which was clean, orderly, and pleasant. There was very little sense of being closed in. Even self- contained, locked facilities had large picture windows to provide a view, and skylights allowed the maximum amount of sunlight in. The grounds were spacious with sidewalks and grass, somewhat like a college campus. It was obvious a healthy and orderly environment was a high priority.

The second impression was that the staff were caring, competent and dedicated professionals who knew what they were doing and why. Several staff independently made the point that they want only children with psychiatric issues. None of this enrolling behavior/emotional problem children in order to fill beds.

The third impression was the sense of transition going on while I was there. The changes in the mental health industry through changing insurance standards and managed care approaches has had a profound impact on hospitals and residential treatment centers, as anyone familiar with the health care industry is aware of. The Brown Schools are going through major changes in order to adapt to the changing environment. The balancing act they were going through was how to conform to the new requirements while still maximizing the impact on their patients. A common comment was something like, this is the way we used to do it, and this is how we hope it will work out.
======================

Many of the teachers and administrators working at the schools have criminal records. One of the principal's, Tracy L. Beasley aka Tracy Beasley was convicted of a violent felony and removed from HISD as a result. Those records are available from the Texas Education Agency website.

Please provide actual URLS, as I was unable to corroborate your allegations.

[Andrew]

I can attest to his comments regarding teachers, staff with criminal records. I have worked at 2 former Brown Schools residential treatment centers in Austin, TX. The first one I worked at was pretty much a snake pit. They were packed to the gills with poorly educated direct care staff, many of whom did, in fact, have criminal backgrounds and records. They had at one point, on their staff (not while I was there) a fellow who was a convicted sex offender, who actually is in jail now for molesting a resident at the center. There are staff there that make fun of the residents disorders, openly taunting them. They also use volatile patients as weapons to weed out staff members that are not willing to go along with the abusive conditions. On 2 different occasions I was told by my co worker one evening how he and another staff had provoked a rather large and strong patient into attacking a staff member who had reported them for abusing a patient. I was there during the attack and it was down right scarey!
Thankfully I got out of there and now work at a very ethical, fun, reputable facility, also in Austin and also formerly Brown Schools.
Would be happy to discuss this further via email. Drop me a line.

[Steve Saal]

My Name Is Steve Saal?
I want to Brown Schools In Austin and then San Marcus Texas.At the brown schools In Austin we never had the trouble that you are talking about It was nothing bad at all I want to Brown Schools In nineteen sixty two I was at this School until nineteen sixty three and then I want to San marcus to the Brown Schools there.And that School was not bad either I have no Idea what you are talking about because I lived at two Brown Schools andd they were both good.That Is were I learned to spell read write so It was not bad at all.I have not had any trouble there at all.I have not been at thase School for over forty years now I did not no there was any trouble there at all.It Is to bad that the Brown schools are like that now.By for now

Your Friend
Steve

[Joe]

went through many workshops...

[Patrick]

There are a number of facts and sources wrong with the information contained in this story. People reading it should verify the facts before taking it for Law. True the Brown School Organization did file bankruptcy and had some problems in some states, but the information provided for Houston area is 85% wrongly stated! I researched the information for the Principal, Tracy Beasley, what I found was that he was charged with assualt but never convicted of the Felony crime in 1985-1986. We are talking about 22-23 years ago. He worked as the Principal in 2004-205. As a matter of fact the assault he was charged with was for taking matters into his own hands after he severly beat-up a guy who mugged his mother and ran off with her purse. The mugger was caught by police. Apparently Tracy found out who he was and took matters into his own hands. This person suffered a fractured skull, broken jaw, and several lacerations. The charges were reduced to a misdeameanor and a $200.00 fine was paid. I would have done the same thing in his case. I also researched the school's record under his leadership and found that the school was rated unacceptable before he came and under his leadership the school was rated exemplary before he left. As far as HISD is concerned he was hired as an administrator and let go after they found out he was chared with the assault 1n 1985. HISD has a policy that they do not hire anyone who was charged with a violent offense. Tracy sued the district and won! Whoever wrote this story on The Brown Schools must have had a personal vendetta and used whatever information they could find, wrong or otherwise to justify their ends!