Corinthian Schools Inc. and Titan Schools Inc., subsidiaries of Santa Ana-based Corinthian Colleges Inc have reached a settlement with California Attorney General Jerry Brown to refund $4.3 million to former students, and pay $1.5 million for student debt cancellation. Additionally, Corinthian will pay $700,000 in civil penalties.
According to Hoovers.com (a D&B company), Corinthian had sales of $966.7 Million with net income of $41.5 Million in 2006. Their website states that they have 94 schools in 24 states with 65,000 students.
Corinthian is also required to cease offering 11 courses for 18 months, including the Pharmacy Technician program in Anaheim.
Here is Corinthian’s statement: “We disagree with the Attorney General’s conclusions, but we are pleased to have this matter behind us. The agreement is not evidence of wrongdoing, and the company specifically denied any wrongdoing as part of the settlement. We are fully committed to providing quality education and job placement services for students and to being in compliance with state law and regulation.”
Sometimes, it can be better to create a settlement which will allow your company to just get back to business. Would prolonged litigation have brought about a better result for Corinthian? We’ll never know. And considering that $6.5 Million is equal to about 2 months of Corinthian’s 2006 profit, this settlement was likely to be the best scenario in that it allows the school to focus on its business which can easily accommodate this “bump in the road.”
Trying to operate a business embroiled in litigation is like trying to play tennis in handcuffs. You may win a few points but you’re likely to lose the match.
Read more about the Value of Time and the true cost of business litigation.