Shareholders lob allegations at The Washington Post’s Kaplan unit

Premium content from Washington Business Journal - by Ben Fischer

Date: Friday, July 8, 2011, 6:00am EDT

Already besieged by federal and state investigations, The Washington Post Co.’s star subsidiary is staring down another gauntlet, this time in the courtroom.

In a new court filing, investors accuse the Post and two senior executives of hiding aggressive and potentially unlawful recruitment tactics of Kaplan Inc., and downplaying the risk that regulators would eventually target the operator of for-profit colleges. Those actions, the suit claims, artificially kept the parent company’s stock price high for a year before government investigations became public.

Citing 21 former Kaplan employees and one former client as confidential witnesses, the plaintiffs allege widespread company practices designed to maximize government-funded revenue at the expense of the students’ best interests, as well as tactics instituted to skirt regulations that govern recipients of federal student loans

Read more here.

“It’s kind of a mini Reston Town Center.”

DRI Development Services LLC, the developers of the Rock Spring Centre have unveiled their plans for development across the street from Walter Johnson High School. Get ready!

Washington Business Journal reporter Missy Frederick wrote,

The project, at Old Georgetown Road and Rock Spring Drive in Bethesda…received site plan approval from Montgomery County in February.

It will include about 550,000 square feet of office space within two buildings, 210,000 square feet of ground level retail, a 200-room hotel, 161 housing units and a movie theater.

Read more at the Washington Business Journal.

Them That's Got: Leggett Appointments

Ike Leggett appointed Steve Silverman to the position of Director of the Montgomery County Department of Economic Development in 2009. Salary, $180,000. How does the Department measure up to similar departments in neighboring areas? This past Friday’s Washington Business Journal has the answer. Research was conducted by Lindsay Smith. Thanks, Ms. Smith!

Here is how Steve Silverman is doing: Current Annual Budget: $6.8 million. Previous annual budget: $10.8 million. Jobs created in the last fiscal year: 1,999. The fiscal year ends on June 30, 2010.

Fairfax County Economic Development Authority: Current Annual Budget: $6.5 million. Previous annual budget: $6.5million. Jobs created in the last fiscal year: 6,283. The fiscal year ends on June 30, 2010.

Arlington Economic Development: Current Annual Budget: $4.55 million. Previous annual budget: $4.74 million. Jobs created in the last fiscal year: 5,077. The fiscal year ends on June 30, 2010.

E-Learning is Big Business

This week's Washington Business Journal has an article on the business end of 'E-Learning.'  Journal reporter Bill Flook writes of a "...heightened interest from venture capitalists (VC) in companies that develop educational software..." and, "As big, for-profit companies capture some of the billions of dollars that the nation spends each year on education, venture capitalists are showing a bigger appetite for e-learning deals."

Why?
According to Tony Florence, a partner at NEA, one of the biggest VC companies on the planet, "It's an area where things are really accelerating..." and, says Roger Novak, a general partner at Novak Biddle Venture Partners in Bethesda, "I think what you see there is continuing instability, or chaos, surrounding the whole education area...Anytime you have that, I think there is an opportunity to make money."

Here are a few of the for-profit E-learning companies in our area: Blackboard, Inc. (DC); K-12, Inc. (Herndon); Strayer University (Arlington); Intelliworks, Inc. (Bethesda); ePals (Herndon); Latimer Education, Inc. (DC); Regent Education, Inc. (Frederick); and Moodlerooms, Inc. (Baltimore).

No wonder MCPS is takin' it private!  Taxpayers, we are all VCs now!

A Very Unique Entity

This week’s Washington Business Journal has an interesting interview with Stew Edelstein, the Executive Director of the Universities of Shady Grove. Mr. Edelstein is a member of our ‘Montgomery County Business Roundtable for Education (MCBRE),' as well as co-chair of the Montgomery County Chamber of Commerce Education and Work Force Committee. And here’s what he had to say about our schools, below, in an interesting interview by Sarah Krouse.  Thanks Sarah! I have read discussions of universities contemplating privatization. Is this what is being discussed here in MoCo too?

"USG is expanding. Can you grow on-site?  We now have 3,600 students. Next year we will have 4,000, and we will ultimately reach our capacity of 5,000, so we are starting to look into the next building. We actually have the ability to build four more buildings and a couple of additional parking garages on our site. Our next building will have an anchor tenant that is a dentistry program. We are talking about three engineering disciplines: mechanical, electrical and bioengineering. We will probably have a biomedical specialization in the bioengineering program. We are also looking into health informatics and — working with the University of Maryland, College Park — starting a degree in public health. The last part of our short-term vision is education.

What do you have planned for that? We are looking at a very unique entity: a public high school focused on STEM [science, technology, engineering, and mathematics]. We have suggested a curricular focus in biomedical sciences and are looking at a concept called middle college."