From
Hidden Lake Court Complaint, Class Action Suit (pdf download), pp2-8:
NATURE OF ACTION
1. This case is about the tragic mistreatment of troubled teenage students and their families by a private residential boarding school and its founder and principal, Dr. Leonard Buccellato ("Buccellato").
2. Hidden Lake touts itself as a "therapeutic boarding school" geared to highschool-aged students typically between the ages of 12-18 who exhibit oppositional-defiant behavior, low self-esteem, depression, alcoholism, drug addiction, attention-deficit disorder, deteriorating family relationships and other social deficits. HLA offers a 1721 month comprehensive program supposedly blending therapy, counseling and education aimed at modifying its students' troubled behavior. HLA holds itself out as one of the foremost such programs in the country. The families and other caregivers of these children, in turn, pay HLA thousands of dollars per month -- currently over $5,900per month -- in what is represented by HLA to be "an all-inclusive tuition."
3. To attract such students and their families to the program, HLA has made a number of written representations regarding HLA's costs, operations and educational and therapeutic offerings. Families were told via HLA's parent Handbook, website, and other marketing and promotional materials, among other things: that "academic classes are led by state certified teachers who are supported in their work by a certified learning disability specialist"; that "all counseling staff are full time and are clinically trained, holding a master's degree or higher"; that HLA employs "a full-time nurse on staff seven days a week"; that "prescription medications are distributed by a nurse or another trained staff member four times per day"; and that its "students are not court ordered and do not include violent or severely disturbed children." All of these claims are meant to lend Hidden Lake an air of exclusivity -- i.e., that parents are sending their children to a nurturing and safe "therapeutic" environment which differs fundamentally from other schools meant for troubled teens, and which is commensurate with the high charges parents pay for the program.
4. However, beginning in 2000 and extending through the present (the "Class Period"), the reality of HLA belies those representations. In fact, throughout the Class Period a large number and, at certain times, an overwhelming majority, of HLA's teachers have not been certified, while a sizeable number of the counseling staff lack bachelor's or master's degrees in areas related to social work, counseling, or psychology, and have not been clinically trained in counseling or social work. HLA has also during the Class Period only rarely employed a licensed learning disability specialist, and within the past several months or longer has not even employed a registered or properly licensed nurse. Hidden Lake also provides students with deficient medical supervision, allowing unlicensed staff such as secretaries and pharmaceutical technicians who are unsupervised by a nurse, or proper medical authority to dispense prescription medication to students, and even uses students improperly to do manual labor around HLA's premises to save money on employing sufficient HLA staff.
5. Further, during the Class Period HLA has also enrolled a number of "court-ordered," "violent" or "severely disturbed" students. The enrollment of these children has led, among other things, to several incidents during the Class Period in which students have been violently assaulted by other students -- the precise opposite of the "therapeutic" mission the school tells families it follows. Indeed, an internal HLA email sent in February 2006 by Clarke Poole, HLA's former Director of Admissions during the period January 2000 through March 2006, to HLA's current Director of Admissions (and Public Relations), Nicole Fuglslang, detailed the exploits of three of these students, including one female student who sexually assaulted another female student, and two male students -- who both reportedly were referred to the school by defendant Buccellato himself despite the clear risks these children posed -- who brutally attacked other students. Further, because of the violent and anti-social behavior of some of the students that Hidden Lake accepts, the school has made it a standard practice during the Class Period to strip-search students purportedly as a safety measure, another fact not disclosed sufficiently by HLA to parents prior to the enrolling of their children.
6. HLA has also misrepresented that the monthly tuition it charges, which parents have to pre-pay in full in advance, is "an all-inclusive tuition." In fact, throughout the Class Period HLA has charged families numerous incidental costs and also imposed big undisclosed profit mark-ups for many other items which in some cases exceeded 100 percent. For example, HLA charges students excessive transportation fees for "off-site" visits to physicians both locally in Dahlonega and in the Atlanta area; assesses a $10 fee for "processing" students' prescription medication; imposes shipping surcharges on packages that HLA sends back to parents; levies a graduation fee of $150 or more (with some families paying $350) which all students must pay ostensibly to purchase a graduation outfit; obtains large, undisclosed markups on toiletries and supplies that all students must purchase from its internal store; and significantly overcharges on other items, such as SAT/ACT tests, college applications and required vaccinations.
7. During the Class Period alone, these undisclosed overcharges have reportedly totaled some $800,000-$1,000,000, all of which amounted to pure profit to HLA. Parents have no choice but to pay these charges not only for fear of reprisal against their children enrolled at HLA, but also because if they were to withdraw their children from HLA before completion of the program, they would have to forfeit the final three months of non-refundable tuition they pre-pay (well over $15,000), and their children would not earn any academic credit, which can be earned only upon graduation from the full program. Indeed, HLA has reportedly withheld recently a transcript from at least one family over an outstanding balance of just $8.95. Nevertheless, despite the fact that parents incur huge educational and financial costs for pulling out their children before graduation, more than 50% of HLA's students during the Class Period -- nearly 400 families total -- have failed to graduate from HLA, and instead have left the program prematurely.
8. HLA's zeal to cut corners and misrepresent itself stems from the fact that it is run in large part for the personal enrichment of its founder, defendant Buccellato. Buccellato dominates all of the HLA entities, including both the for-profit Hidden Lake Academy, Inc. and the not-for-profit HLA, Inc. and Hidden Lake Foundation, Inc. Buccellato's control over HLA is well-known amongst the HLA community. Hidden Lake Academy, Inc. receives hundreds of thousands of dollars in "management fees" from HLA, Inc., the bulk of which is distributed in turn straight to Buccellato, who is CEO, CFO and Secretary of the for-profit corporation. Buccellato uses HLA, Inc. as his personal bank and employment agency by, among other things: billing to it significant amounts of his personal expenses, including extravagant dinners, gifts to friends and family, and lavish vacations totaling thousands of dollars; using school maintenance staff to maintain and repair personal rental properties; having the school pay his personal taxes and service his loan payments; arranging for present or former school therapists, such as Dr. Steven Taylor and Dr. Brad Carpenter, to work up to four days per week in his private psychology practice; enlisting school employees to work part-time at St. Francis Day School, a school that Buccellato also helps operate; and getting the school's food service provider to privately cater personal affairs, which he then bills to the school. Buccellato also arranges for HLA to pay hundreds of thousands of dollars each year to Ridge Creek, Inc. ("Ridge Creek"), a for-profit corporation he founded in 2001 which is located adjacent to HLA, and whose property is mostly owned by Hidden Lake Academy, Inc. and HLA, Inc.
9. Buccellato has placed his long-time companion, Kenneth Spooner, as HLA, Int.'s CEO, CFO and Secretary. Spanner also serves as HLA, Inc.'s Board Chairman, while Spooner's sister, Diane Cooper, and Spooner's father, Robert Spooner, serve as the other two Board directors. In reality, however, Buccellato dominates all aspects of HLA, Inc.'s affairs, making almost every school-related decision unilaterally, with the Board of Directors rarely meeting or, when it does meet, engaging in only perfunctory meetings. Indeed, Buccellato has reportedly even gone to the extent of forging Spooner's signature on certain school-related documents, such as contracts, tax returns, and loan documents between HLA and its lenders, including First Cherokee State Bank, Lumpkin County Bank and Nexity Bank, among other things, as Spooner was not present to sign the documents.
10. In addition to falsely touting its costs and operations, another reason why Hidden Lake has been so successful in recruiting students to the school is because of Buccellato's close -- and, in certain instances ethically questionable -- relationship with education consultants. In general, education consultants are hired by parents to provide impartial advice as to where parents should send their troubled children to school. Realizing the significant role consultants play in the school selection process, Buccellato showers consultants with gifts and other dorms of undisclosed compensation. For example, Buccellato pays the traveling expenses of many consultants and even the consultant's family members who happen to visit the Atlanta metropolitan region for personal reasons. In such situations, Buccellato arranges for the consultants to quickly meet him, with Hidden Lake picking up the consultant's traveling and incidental expenses. Each year, Buccellato also gives expensive Christmas gifts, some totaling over $1,000, to consultants as way of ensuring their fealty.
11. Plaintiffs enrolled their children at HLA during the Class Period, and were injured by the misconduct alleged in this complaint. Plaintiffs bring this action against Buccellato and the HLA Defendants individually and on behalf of a class of similarly situated families whose children were enrolled at HLA during the Class Period. Plaintiffs' claims arise under the Georgia Fair Business Practices Act and Georgia common law. Plaintiffs seek damages, restitution and injunctive relief.
