Supreme Court of California Justia
Docket No. S123951
Wells v. One2One Learning

Filed 8/31/06 (this opn. should precede companion case, S131807, also filed 8/31/06)



IN THE SUPREME COURT OF CALIFORNIA



JOEY WELLS, a Minor, etc., et al.,

Plaintiffs

and

Appellants,

S123951

v.

) Ct.App.

3

C042504

ONE2ONE LEARNING FOUNDATION )
et al.,

Sierra

County

Defendants and Respondents; )

Super. Ct. No. S46-CV-5844

STATE OF CALIFORNIA,

Real Party in Interest and Respondent. )



The Charter Schools Act (CSA; Ed. Code, § 47600 et seq.), as adopted by

the Legislature in 1992 and since amended, represents a revolutionary change in

the concept of public education. Under this statute, interested persons may obtain

charters to operate schools that function within public school districts, accept all

eligible students, charge no tuition, and are financed by state and local tax dollars,

but nonetheless retain considerable academic independence from the mainstream

public education system. Such schools may elect to operate as, or be operated by,

corporations organized under the Nonprofit Public Benefit Corporation Law. (Id.,

§ 47604, subd. (a).)

Here certain charter schools, their corporate operators, and the chartering

school districts were sued on multiple grounds by some of the schools’ students

1


and their parents or guardians. The gravamen of all the claims is that the

schools—designed to provide and facilitate home instruction through use of the

Internet (so-called distance learning)—failed to deliver instructional services,

equipment, and supplies as promised, and as required by law. In effect, the

plaintiffs assert, the schools functioned only to collect “average daily attendance”

(ADA) forms, on the basis of which the schools, and the districts, fraudulently

claimed and received public education funds from the state. Plaintiffs also claim

violations of specific statutory rules governing “independent study” programs

offered by the public schools.

This case concerns whether, and in what circumstances, public school

districts, charter schools, and/or the operators of such schools may be exposed to

civil liability based on allegations of this kind. Among other things, we must

determine whether such entities, or any of them, are “persons” who may be sued

(1) under the unfair competition law (UCL; Bus. & Prof. Code, § 17200 et seq.)

and (2) in a qui tam action, brought by individuals on behalf of the state, under the

California False Claims Act (CFCA; Gov. Code, § 12650 et seq.).1

We reach the following conclusions: (1) Public school districts are not

“persons” who may be sued under the CFCA. (2) On the other hand, charter


1

The CFCA provides a single definition of “person” for all purposes of that

statute. “Persons” who knowingly submit false claims to state or local
governments may be sued under the CFCA (Gov. Code, § 12651), and, under
certain circumstances, “persons” may also bring “qui tam” actions, on behalf of
defrauded governmental entities, against alleged false claimants (id., § 12652,
subd. (c)). Here, as noted above, we consider, among other things, whether public
entities are “persons” who may be sued as false claimants under the CFCA. In a
companion case, State of California ex rel. Harris v. PricewaterhouseCoopers,
LLP
(Aug. 31, 2006, S131807) ___Cal.4th ___ (Harris), we address the question
whether a governmental entity is a person who, as a qui tam plaintiff under the
CFCA, may sue for alleged false claims that were submitted only to other public
agencies.

2

schools, and the individuals, corporations, entities, or organizations that operate

them, are “persons” subject to suit under both the CFCA and the UCL, and are not

exempt from either law merely because such schools are deemed part of the public

school system. (3) The CFCA cause of action is not a barred claim for

“educational malfeasance” (see Peter W. v. San Francisco Unified Sch. Dist.

(1976) 60 Cal.App.3d 814 (Peter W.)) insofar as it asserts, not simply that

One2One’s charter schools provided a substandard education, but that they

submitted false claims for school funds while failing to furnish any significant

educational services, materials, and supplies. (4) The CFCA cause of action is

not barred insofar as it alleges that, before 2000, the charter schools violated

“independent study” rules set forth in a 1993 statute, Education Code section

51747.3, because section 51747.3 applied to charter schools even before its

amendment in 1999. (5) Finally, a qui tam action under the CFCA against a

charter school operator is not subject to the Tort Claims Act (TCA; Gov. Code,

§ 815 et seq.) requirement of prior presentment of a claim for payment (see id.,

§§ 905, 910 et seq.). These conclusions require that we affirm in part, and reverse

in part, the judgment of the Court of Appeal.

FACTS AND PROCEDURAL BACKGROUND

On December 30, 1999, plaintiffs filed a complaint, which included a claim

for qui tam relief on behalf of the state, under the CFCA. (Gov. Code, § 12652,

subd. (c)(1).) As provided by the CFCA in such cases, the complaint was filed

under seal. (Id., subd. (c)(2).) In July 2000, after the seal was lifted, the Attorney

General noticed his election to intervene in, and proceed with, the CFCA action on

behalf of the state. (Id., subd. (c)(6).)

On August 11, 2000, plaintiffs filed their first amended complaint (the

complaint). As pertinent to the issues before us, the complaint alleged the

following:

3

At various times during 1997, 1998, and 1999, defendant One2One

Learning Foundation (One2One), a Texas corporation, operated three charter

schools in California through its California corporate alter ego, defendant Charter

School Resource Alliance (CSRA). These schools included (1) defendant Sierra

Summit Academy, Inc. (Sierra Summit Academy), operating as a California

nonprofit corporation, and chartered by the Sierra Plumas Joint Unified School

District (Sierra District) in Sierra County, (2) defendant Mattole Valley Charter

School (Mattole Valley School), chartered by the Mattole Unified School District

(Mattole District) in Humboldt County, and (3) defendant Camptonville Academy,

Inc. (Camptonville Academy), operating as a California nonprofit corporation, and

chartered by defendant Camptonville Union Elementary School District

(Camptonville District) in Yuba County.

Defendant Robert Carroll is One2One’s president and chief executive

officer. Defendant Jeff Bauer is Superintendent of the Sierra District. Defendant

Carol Kennedy is the Director of Sierra Summit Academy. Defendant Richard

Graey is Superintendent of the Mattole District and the Director of Mattole Valley

School. Defendant Allen Wright is Superintendent and Principal of the

Camptonville District. Defendant Janis Jablecky is the Director of Camptonville

Academy.2

Each plaintiff was a minor student enrolled in one of the defendant charter

schools at some time during 1998 and/or 1999, or the parent and/or guardian of


2

One2One, CSRA, Sierra Summit Academy, Mattole Valley School, and

Camptonville Academy, as identified and described in the complaint, are hereafter
collectively referred to as the charter school defendants. The Sierra District, the
Mattole District, and the Camptonville District are hereafter collectively referred
to as the district defendants. The charter school defendants, the district
defendants, and the individual defendants are hereafter collectively referred to as
all defendants.

4

such a student. All the plaintiffs were direct victims of One2One’s failure to

provide promised instruction, testing, equipment, materials, and supplies.

Like traditional public schools, charter schools are funded by the state

based on ADA records. While charter schools have considerable freedom in their

academic approach, they must meet statewide educational standards and use

appropriately credentialed teachers. The chartering entity, usually a school

district, has oversight responsibilities, and must revoke a school’s charter for fiscal

mismanagement, material violation of the charter, failure to meet or pursue any of

the educational outcomes set by the charter, failure to meet generally accepted

accounting principles, or violation of law.

Sierra Summit Academy, Mattole Valley School, and Camptonville

Academy were operated as distance learning schools, in which students study at

home, complete lessons on their computers, and transmit them via the Internet to

the school. Students are also tested through the Internet.

The charters and promotional literature for One2One-operated schools

promised to provide “ways and means” for students to achieve an education

through distance learning, including the furnishing of computers, necessary

software, and textbooks, and reimbursement of up to $100 per month for out-of-

pocket educational expenses incurred by students or their parents or guardians.

Each student was also to be assigned an “educational facilitator,” who was to

devise a learning contract for the student, provide parents with a copy of the

student’s curriculum goals, order necessary educational materials, and come to the

student’s home a few hours per week for personal instruction, testing, and

evaluation.

Despite its promises, One2One has failed to provide the enumerated

equipment, supplies, and services, either to plaintiff students or to any of its

enrollees. Its educational facilitators—who, on information and belief, are

5

teaching outside their credentialed areas or are not credentialed at all—do not

provide assessment, instruction, review, or curriculum, either online or in person.

One2One also fails to reimburse students, parents, and guardians for educational

expenses. In some cases, parents actually pay One2One for equipment and for

educational materials and supplies, either because One2One has failed to provide

these items for free as promised, or because parents have exhausted their $100 per

month expense allowance. Moreover, One2One overbills for the educational

materials and software it does provide. In particular, the educational software

programs One2One uses are available online for free, or for much less than

One2One charges.3

One2One aggressively recruits poor, rural districts to approve their charter

schools, then enrolls students throughout the state for distance learning. In return

for chartering its schools and allowing their operation, One2One pays the districts

administration fees in excess of those allowed by statute. Despite their oversight

responsibilities, the districts enable One2One to misuse public funds by turning a

blind eye to the charter schools’ activities, and, for the most part, failing to take

steps to monitor them.

On the basis of allegations such as these, the complaint asserted causes of

action against the charter school defendants for breach of contract (seventh cause

of action) and intentional and negligent misrepresentation (fourth and fifth causes

of action, respectively). Against the charter school and district defendants, it

contained claims for mandamus and declaratory relief (third and 10th causes of


3

Included in the complaint were detailed allegations concerning the charter

schools’ treatment of the named plaintiffs, including the schools’ broken promises
to supply computers and educational materials, and the failure of their
“educational facilitators” to provide home visits, or any other significant contact,
except for “religious” visits to collect signed ADA forms. The complaint also
contained class action allegations.

6

action, respectively), and for violation of the free school, equal protection, and due

process guarantees of the California Constitution (eighth and ninth causes of

action, respectively). As to all defendants, it sought injunctive relief against

misuse of taxpayer funds (second cause of action).

Finally, the complaint included, (1) against the charter school and district

defendants, a CFCA cause of action for qui tam relief, on behalf of the state, for

the alleged submission of false and fraudulent claims for payment of state

educational funds (first cause of action) and, (2) against the charter school

defendants, an individual and representative claim under the UCL, alleging unfair

and deceptive business practices in the operation of the schools (sixth cause of

action).

The CFCA cause of action asserted that the charter school defendants

submitted false claims, within the meaning of this statute, by requesting funding

from the districts and/or the state, “knowing that their ADA records did not

accurately reflect the students enrolled in and receiving instruction, educational

materials, or services from their schools.” (At another point, the complaint alleged

more generally that One2One “fails to provide the education it promises but

falsely collects State educational funds as if the education were provided.”)

The CFCA count also alleged that the charter school defendants falsely

claimed ADA funds (1) for what was effectively independent study, though the

schools were in violation of Education Code section 51747.3, subdivision (a), in

that they provided money or other things of value to independent study pupils that

were not provided to students attending regular classes, and (2) for independent

study pupils who, in violation of subdivision (b) of the same section, resided

7

outside the counties in which the respective schools were located, or adjacent

counties.4

In the CFCA cause of action, the complaint alleged that the district

defendants had submitted false claims on behalf of the charter schools, even

though they “knew or deliberately or recklessly disregarded whether the public

funds were being used for wrongful purposes.” Further, the complaint asserted,

the district defendants wrongfully claimed funds for supervisory services beyond

the limits set forth in the CSA.

Aside from the injunctive and declaratory relief noted above, the complaint

sought, among other things, (1) compensatory and punitive damages against the

charter school defendants, and, (2) against the charter school and district

defendants, restitution of funds falsely claimed and received, with treble damages

and civil penalties as provided in the CFCA.

Several defendants demurred.5 In November 2001, the trial court sustained,

without leave to amend, the demurrers as to the first (CFCA), second (taxpayer

injunctive relief), fourth (intentional misrepresentation), fifth (negligent

misrepresentation), sixth (UCL), and seventh (breach of contract) causes of

action.6 The court reasoned as follows: (1) All these counts are noncognizable


4 According to the complaint, for each of the 5,200 students enrolled
statewide in its distance learning charter schools, One2One collects ADA funds of
about $120 per day, or $4,350 per school term. The complaint thus asserted
generally that, on the basis of One2One’s failure to provide educational services
and materials as promised in its charters and required by law, “One2One engages
in a practice of defrauding parents, school districts, and the State by collecting
more than $20 million annually in educational funds.”

5

Separate demurrers were filed by (1) CSRA and Carroll, (2) Sierra Summit

Academy, Sierra District, Bauer, and Kennedy, and (3) One2One. One2One later
filed a joinder in the demurrer of CSRA and Carroll.

6

Previously, in September 2001, the trial court had denied the State of

California’s motion to dismiss plaintiffs’ CFCA claim for lack of jurisdiction. The

8

private claims for “educational malfeasance.” (2) Because the charter school and

district defendants are “public entities,” the CFCA, intentional misrepresentation,

and negligent misrepresentation causes of action are subject to the TCA

requirement of prior presentment of a claim for payment. (3) As “public entities,”

the charter school defendants are not “persons” subject to suit under the UCL. (4)

The taxpayer claim for injunctive relief is subject to the requirement of a prior

claim for refund. (5) The CFCA claim for violation of the statutory restrictions

on “independent study” programs fails, because those restrictions applied to

charter schools only in and after 2000, and all the facts alleged in the complaint

precede that date.7

All parties stipulated that (1) the trial court’s ruling on the demurrers was

binding, as law of the case, on those defendants who had not demurred, (2) the


motion was made under Government Code section 12652, subdivision (d)(3)(A),
which deprives the court of jurisdiction over a private qui tam CFCA action that is
based on the prior “public disclosure” of the facts supporting the claim, where the
disclosure was made “in a criminal, civil, or administrative hearing, in an
investigation, report, hearing, or audit conducted by or at the request of the Senate,
Assembly, auditor, or governing body of a political subdivision, or by the news
media,” unless the qui tam plaintiff “is an original source of the information.” The
ruling on this motion is not involved in the appeal before us.

7

After an initial hearing on the demurrers, the trial court issued a final ruling

as to the second (taxpayer injunctive relief), third (mandamus), fourth (intentional
misrepresentation), fifth (negligent misrepresentation), seventh (breach of
contract), eighth (free school guarantee), ninth (equal protection and due process),
and tenth (declaratory relief) causes of action. However, as to the first (CFCA)
and sixth (UCL) causes of action, the court obtained additional briefing on
whether, in light of a then-recent Court of Appeal decision, LeVine v. Weis (2001)
90 Cal.App.4th 201 (LeVine II) (see also LeVine v. Weis (1998) 68 Cal.App.4th
758 (LeVine I)), the charter school and district defendants, as “public entities
within the public school system,” could be sued under the CFCA and the UCL. In
its final ruling, as noted, the court determined that the charter school defendants
were not subject to suit under the UCL, but the court did not decide whether a
similar rule applied to either the charter school or district defendants under the
CFCA.

9

remaining causes of action would be dismissed in order to facilitate appellate

review, and (3) plaintiffs would dismiss the individual defendants. Judgment was

entered accordingly.

Plaintiffs appealed, urging that the CFCA, UCL, contract, and

misrepresentation claims should not have been dismissed.8 The Court of Appeal

reversed the judgment of dismissal. The Court of Appeal agreed with the trial

court that the causes of action for breach of contract and misrepresentation are

barred by the rule that private parties cannot sue public schools for “educational

malfeasance.” The Court of Appeal also concurred that the charter school

defendants, as part of the public school system, are “public entities,” and thus are

not “persons” who may be sued under the UCL.

On the other hand, the Court of Appeal held that the CFCA, unlike the

UCL, does include public entities among the “persons” who may be sued. Hence,

the Court of Appeal determined, charter schools and public school districts may be

subject to private qui tam actions under the CFCA. Moreover, the Court of

Appeal reasoned, plaintiffs’ CFCA allegations—i.e., that the charter school and

district defendants made or facilitated fraudulent claims to obtain state ADA funds

for educational services that were not provided—are not a prohibited cause of

action for “educational malfeasance.”


8

No defendant cross-appealed from the trial court’s order overruling

demurrers to the third (mandate), eighth (free school guarantee), ninth (equal
protection/due process), and tenth (declaratory relief) causes of action. Nor did
any of defendants’ Court of Appeal briefs argue that those counts should have
been dismissed. By the same token, after stipulating in the trial court to dismissal
of individual defendants Carroll, Bauer, Kennedy, Graey, Wright, and Jablecki,
plaintiffs did not contend in the Court of Appeal that the second cause of action
(taxpayer relief)—the only one naming those defendants—should be reinstated.
The State of California, as real party and respondent, filed a brief asserting only
that the “prior claim” requirement of the TCA should not apply to qui tam actions
under the CFCA.

10

Nor, the Court of Appeal concluded, must a qui tam action under the CFCA

be preceded by presentment of a claim for payment pursuant to the TCA. In this

regard, the Court of Appeal noted that (1) the state is expressly exempt from the

TCA’s “prior presentment” requirement (Gov. Code, § 905, subd. (i)), (2) a qui

tam plaintiff under the CFCA stands in the shoes of the state, and (3) application

of a “prior presentment” requirement in this context would undermine the CFCA’s

provision that qui tam actions must initially be filed under seal, thus allowing the

state to investigate, without prior warning to the alleged false claimant, before

deciding whether to intervene in the action.

Finally, however, the Court of Appeal concurred with the trial court that

plaintiffs’ CFCA claim must fail insofar as it is based on allegations that the

charter schools violated the “independent study” statute (Ed. Code, § 51747.3).

Like the trial court, the Court of Appeal concluded that, while the complaint

covered only acts done by the charter school defendants in the years 1998 and

1999, the “independent study” statute did not apply to charter schools until the

year 2000.

The Court of Appeal remanded for further proceedings consistent with its

opinion. We understand the effect of the Court of Appeal’s judgment to be that

plaintiffs may proceed against both the district and charter school defendants on

the CFCA cause of action—minus the allegations concerning violation of the

statutory rules governing “independent study” programs—but may not proceed on

the UCL, contract, or misrepresentation causes of action.

Petitions for review were filed by defendants (1) One2One, (2) CSRA,

(3) the Mattole District and Graey, (4) Camptonville Academy and Jablecki, and

(5) the Sierra District and Sierra Summit Academy. All challenged the Court of

Appeal’s reinstatement of plaintiffs’ CFCA cause of action. The petitions

variously argued that (1) the charter school and district defendants are “public

11

entities,” and as such, are not “persons” subject to suit under the CFCA, (2) a qui

tam action under the CFCA is subject to the “claim presentment” provisions of the

TCA, and (3) the CFCA allegations are a disguised claim for “educational

malfeasance.”

Plaintiffs answered the petitions, urging, as additional issues, that (1) the

restrictions on “independent study” programs imposed by Education Code section

51747.3 have applied to charter schools since that statute’s adoption in 1993 and

(2) private nonprofit corporations operating charter schools are “persons” covered

by the UCL. We granted review. As will appear, we agree with certain of the

Court of Appeal’s holdings and disagree with others. We will therefore reverse in

part the Court of Appeal’s judgment.9

DISCUSSION

1. The CSA.

The CSA, as adopted in 1992 and since substantially amended, is intended

to allow “teachers, parents, pupils, and community members to establish . . .

schools that operate independently from the existing school district structure.”

(Ed. Code, § 47601.) By this means, the CSA seeks to expand learning

opportunities, encourage innovative teaching methods, provide expanded public

educational choice, and promote educational competition and accountability

within the public school system. (Id., subds. (a)-(g).)


9

Amicus curiae briefs in support of defendants have been filed by (1) the

Statewide Association of Community Colleges et al., (2) Fullerton Joint Union
High School District et al., (3) the Pacific Legal Foundation, (4) the California
State Association of Counties, (5) Coast Community College District, and
(6) PricewaterhouseCoopers, LLP. An amicus curiae brief in support of plaintiffs
has been filed by Taxpayers Against Fraud. We appreciate the assistance provided
by these briefs.

12

If statutory requirements are met, public school authorities must grant the

petition of interested persons for a charter to operate such a school within a public

school district. (Ed. Code, § 47605.) For certain purposes, the school is “deemed

to be a ‘school district’ ” (id., § 47612, subd. (c)), is “part of the Public School

system” (id., § 47615, subd. (a)), falls under the “jurisdiction” of that system, and

is subject to the “exclusive control” of public school officers (id., § 47615, subd.

(a)(2); § 47612, subd. (a)). (See Wilson v. State Bd. of Education (1999)

75 Cal.App.4th 1125, 1136-1142 (Wilson).)

A charter school must operate under the terms of its charter, and must

comply with the CSA and other specified laws, but is otherwise exempt from the

laws governing school districts. (Ed. Code, § 47610.) A charter school may elect

to operate as, or be operated by, a nonprofit corporation organized under the

Nonprofit Public Benefit Corporation Law. (Id., § 47604, subd. (a), as added by

Stats. 1998, ch. 34, § 3.)

A charter school is eligible for its share of state and local public education

funds, which share is calculated primarily, as with all public schools, on the basis

of its ADA. (Ed. Code, § 47612; see also id., § 47630 et seq.)10 Provisions added

to the CSA since its original adoption enumerate certain oversight responsibilities

of the chartering authority (id., § 47604.32), and authorize that agency to charge

the school supervisorial fees, within specified limits, for such services (id.,

§ 47613).


10

California school finance is enormously complex, but the basic system is

that “funds raised by local property taxes are augmented by state equalizing
payments. Each school district has a base revenue limit that depends on average
daily attendance, . . . and varies by size and type of district. [¶] The revenue limit
for a district includes the amount of property tax revenues a district can raise, with
other specific local revenues, coupled with an equalization payment by the state,
thus bringing each district into a rough equivalency of revenues.” (56 Cal.Jur.3d
(2003) Schools, § 7, p. 198.)

13





2. The CFCA.

The CFCA, which is patterned after a similar federal law, was adopted in

1987. (Stats. 1987, ch. 1420, § 1, p. 5237.) It provides that “[a]ny person” who,

among other things, “ [k]nowingly presents or causes to be presented to . . . the

state or . . . any political subdivision thereof, a false claim for payment or

approval,” or “[k]nowingly makes, uses, or causes to be made or used a false

record or statement to get a false claim paid or approved by the state or by any

political subdivision,” or “[c]onspires to defraud the state or any political

subdivision by getting a false claim allowed or paid by the state or any political

subdivision,” or “[i]s a beneficiary of an inadvertent submission of a false claim to

the state or a political subdivision, subsequently discovers the falsity of the claim,

and fails to disclose the false claim to the state or the political subdivision within a

reasonable time after discovery [thereof],” “shall be liable to the state or to the

political subdivision for three times the amount of damages” the state or political

subdivision thereby sustained, as well as for the state’s or political subdivision’s

costs of suit, and may also liable for a civil penalty of up to $10,000 for each false

claim. (Gov. Code, § 12651, subd. (a)(1)-(3), (8).)11

The CFCA defines a “person” to “include any natural person, corporation,

firm, association, organization, partnership, limited liability company, business, or

trust.” (Gov. Code, § 12650, subd. (b)(5).)


11

In certain circumstances, where the person submitting the false claim

reported it promptly and cooperated in any investigation, the court may assess less
than three times the damages (though no less than two times the damages), and no
civil penalty. (Gov. Code, § 12651, subd. (b).)

14

Where a “person” has submitted a false claim upon state funds, or upon

both state and political subdivision funds, in violation of the CFCA, the Attorney

General may sue that person to recover the damages and penalties provided by the

statute. (Gov. Code, § 12652, subd. (a)(1).) Where the false claim was upon

“political subdivision funds,” or upon both state and political subdivision funds,

the “prosecuting authority” of the affected political subdivision may bring such an

action. (Id., subd. (b)(1).)12

When either the Attorney General or the local prosecuting authority

unilaterally initiates an action involving both state and political subdivision funds,

the other affected official or officials must be notified. If the Attorney General

initiates such an action, the local prosecuting authority may, upon receiving notice,

intervene. If the local prosecuting attorney is the initiator, the Attorney General

may, upon notice, elect to assume responsibility for the action, though the local

prosecuting authority may continue as a party. (Gov. Code, § 12652,

subds. (a)(2), (3), (b)(2), (3).)

A CFCA action may also be initiated by a “person,” as a “qui tam”

plaintiff, for and in the name of the state or the political subdivision whose funds

are involved. (Gov. Code, § 12652, subd. (c)(1), (3).) The complaint in such an

action shall be filed in camera, and may remain under seal for up to 60 days.

While the complaint remains sealed, “[n]o service shall be made on the

defendant.” (Id., subd. (c)(2).)

The qui tam plaintiff must immediately notify the Attorney General of the

suit and disclose to him all material evidence and information the plaintiff


12

“ ‘Prosecuting authority’ refers to the county counsel, city attorney, or other

local government official charged with investigating, filing, and conducting civil
legal proceedings on behalf of, or in the name of, a particular political
subdivision.” (Gov. Code, § 12650, subd. (b)(4).)

15

possesses. If the qui tam complaint involves only state funds, the Attorney

General may, within the 60-day period or extensions thereof, elect to intervene and

proceed with the action. If political subdivision funds alone are involved, the

Attorney General must forward the qui tam complaint to the local prosecuting

authority, who may elect to intervene and proceed with the action. If both state

and political subdivision funds are involved, the Attorney General and the local

prosecuting authority are to coordinate their investigation and review. Either

official, or both of them, may then elect to intervene and proceed with the action.

If these officials decline to proceed, the qui tam plaintiff shall have the right to

conduct the action. (Gov. Code, § 12652, subd. (c)(4)-(8).) If state or local

officials intervene, they may assume control of the action, but the qui tam plaintiff

may remain as a party. (Id., subd. (e)(1).)

A substantial portion of the proceeds of any settlement or court award in a

CFCA action—as much as 66 percent—does not revert to the general coffers of

the state or the political subdivision against which the false claim was submitted.

Instead, a significant “cut” of these proceeds goes to those who pursued the action

on behalf of the defrauded entity.

Thus, if the Attorney General or a local prosecuting authority initiated an

CFCA action, that officer is entitled to a fixed 33 percent of the proceeds of the

action, or settlement thereof. Where a local prosecuting authority intervened in an

action initiated by the Attorney General, the court may award the local prosecuting

authority a portion of the Attorney General’s 33 percent, as appropriate to the local

authority’s role in conducting the action. If, in an action brought by a qui tam

plaintiff, the Attorney General or the local prosecuting authority proceeds with the

action, that official receives a fixed 33 percent of the proceeds, and the qui tam

plaintiff receives from 15 to 33 percent, depending on his or her litigation role.

Where both the Attorney General and a local prosecuting authority are involved in

16

a qui tam action, the court may award the latter officer a portion of the Attorney

General’s 33 percent, depending on the role played by the local prosecutor.13 If

neither the Attorney General nor the local prosecuting authority elects to proceed

with the action, the qui tam plaintiff may receive between 25 and 50 percent of the

proceeds. (Gov. Code, § 12652, subd. (g).)

The CFCA’s remedies are cumulative to any others provided by statute or

common law. (Gov. Code, § 12655, subd. (a).) Further, its provisions “shall be

liberally construed and applied to promote the public interest.” (Id., subd. (c).)

3. The UCL.

As pertinent here, the UCL provides for relief by civil lawsuit against

“[a]ny person who engages, has engaged, or proposes to engage in unfair

competition.” (Bus. & Prof. Code, § 17203.) “Unfair competition” is defined to

include “any unlawful, unfair or fraudulent business act or practice and unfair,

deceptive, untrue or misleading advertising . . . .” (Id., § 17200.) An action for

injunctive relief, which relief may include orders necessary “to restore to any

person in interest any money or property. . . . acquired by means of such unfair

competition” (id., § 17203), may be brought (1) by the Attorney General or a

specified local prosecuting officer “upon their own complaint or upon the

complaint of any board, officer, corporation, or association,” or (2) “by any person

who has suffered injury in fact and has lost money or property as a result of such

unfair competition” (id., § 17204). For purposes of the UCL, “the term person

shall mean and include natural persons, corporations, firms, partnerships, joint

stock companies, associations and other organizations of persons.” (Id., § 17201.)

13

Any proceeds recovered by the Attorney General as his “cut” of the award

or settlement is deposited into a special False Claims Fund in the State Treasury.
The Attorney General is to use the money in this fund, upon its appropriation by
the Legislature, for the ongoing investigation and prosecution of false claims.
(Gov. Code, § 12652, subd. (j).)

17

Except as otherwise specifically provided, the UCL’s remedies are “cumulative to

each other and to the remedies or penalties available under all other laws of this

state.” (Id., § 17205.)

4. May a public school district be sued under the CFCA?

The Court of Appeal held that both the district and charter school

defendants are “persons” subject to suit under the CFCA. The district defendants

insist that they are not “persons” for purposes of this statute. For reasons that will

appear, we agree with the district defendants.

We apply well-settled principles of statutory construction. Our task is to

discern the Legislature’s intent. The statutory language itself is the most reliable

indicator, so we start with the statute’s words, assigning them their usual and

ordinary meanings, and construing them in context. If the words themselves are

not ambiguous, we presume the Legislature meant what it said, and the statute’s

plain meaning governs. On the other hand, if the language allows more than one

reasonable construction, we may look to such aids as the legislative history of the

measure and maxims of statutory construction. In cases of uncertain meaning, we

may also consider the consequences of a particular interpretation, including its

impact on public policy. (E.g., MW Erectors, Inc. v. Niederhauser Ornamental &

Metal Works Co., Inc. (2005) 36 Cal.4th 412, 426; People v. Smith (2004)

32 Cal.4th 792, 797-798.)

As noted, the CFCA defines covered “persons” to “include[ ] any natural

person, corporation, firm, association, organization, partnership, limited liability

company, business, or trust.” (Gov. Code, § 12650, subd. (b)(5).) We observe at

the outset that while this list is not necessarily comprehensive, the only words and

phrases it uses are those most commonly associated with private individuals and

entities. While, in the broadest sense, a school district might be considered an

“association” or an “organization,” the statutory list of “persons” contains no

18

words or phrases most commonly used to signify public school districts, or, for

that matter, any other public entities or governmental agencies.

Yet the statute makes very specific reference to governmental entities in

other contexts. Thus, it provides that any “person” who presents a false claim to

the “state or [a] political subdivision” is liable to such entity for two or three times

the damage thereby sustained. (Gov. Code, § 12651, subds. (a), (b).) A “political

subdivision” is defined to include “any city, city and county, county, tax or

assessment district, or other legally authorized local government entity with

jurisdictional boundaries.” (Id., § 12650, subd. (b)(3).) The specific enumeration

of state and local governmental entities in one context, but not in the other, weighs

heavily against a conclusion that the Legislature intended to include public school

districts as “persons” exposed to CFCA liability.

In other contexts, the Legislature has demonstrated that similar definitions

of “persons” do not include public entities, and that legislators know how to

include such entities directly when they intend to do so. For example, under the

Fair Employment and Housing Act (FEHA; Gov. Code, § 12900 et seq.), a

“person” is defined to “include[ ] one or more individuals, partnerships,

associations, corporations, limited liability companies, legal representatives,

trustees, trustees in bankruptcy, and receivers or other fiduciaries.” (Id., § 12925,

subd. (d).) FEHA provides that an “ ‘[e]mployer’ includes any person regularly

employing five or more persons, or any person acting as an agent of an employer,

directly or indirectly, the state or any political or civil subdivision of the state, and

cities,” except as otherwise specified. (Id., § 12926, subd. (d), italics added.) This

conceptual separation of “persons” from governmental entities in FEHA is an

19

additional indication that the CFCA’s definition of “person” does not include

public entities.14

The legislative history of the CFCA contains no explicit discussion of the

scope of the word “person.” Nonetheless, the limited evidence available suggests

there was no intent to include school districts and other public and governmental

agencies. As originally introduced on March 4, 1987, Assembly Bill No. 1441

(1987-1988 Reg. Sess.) (Assembly Bill No. 1441), which in final form became the

CFCA, explicitly included, as covered “persons,” “any person, firm, association,

organization, partnership, business trust, corporation, company, district, county,


14

Perusal of the codes discloses other similar examples. Labor Code section

18 defines “person,” for all purposes of that code, to mean “any person,
association, organization, partnership, trust, limited liability company, or
corporation.” In division four of the Labor Code, concerning workers’
compensation insurance, a covered “employer” is defined to include “[e]very
person including any public service corporation, which has any natural person in
service” (Lab. Code, § 3300, subd. (c), italics added) and, additionally and
separately, “[t]he State and every State agency” (id., subd. (a)) and “[e]ach county,
city, district, and all public and quasi public corporations and public agencies
therein” (id., subd. (b)). Section 19 of the Water Code defines “[p]erson,” for all
purposes of that code, to mean “any person, firm, association, organization,
partnership, business trust, corporation, limited liability company, or company.”
However, for purposes of division seven of that code, concerning water quality,
“ ‘[p]erson’ ” also “includes any city, county, district, the state and the United
States. . . .” (Wat. Code, § 13050, subd. (c).)

On the other hand, amicus curiae Taxpayers Against Fraud invokes the

maxim expressio unius est exclusio alterius. Amicus curiae notes that
Government Code section 12652, subdivision (d)(1), explicitly prohibits, under
certain circumstances, qui tam actions against “Member[s] of the State Senate or
Assembly, . . . member[s] of the state judiciary, . . . elected official[s] in the
executive branch of the state, or . . . member[s] of the governing body of [a]
political subdivision.” By exempting these particular “public” defendants, amicus
curiae argues, the CFCA must mean to include all others. We are not persuaded.
The designated officials, as natural persons, clearly fall within the statute’s
definition of covered “persons,” and thus must be expressly exempted in situations
where the statute intends exemption.

20

city and county, city, the state, and any of the agencies and political subdivisions

of these entities.” (Italics added.) A substantial subsequent amendment to the bill

excised the references to governmental entities, and the definition of “person” was

changed to the form finally adopted. (Id., as amended in Assem. (Apr. 29, 1987)

§ 1; see Stats. 1987, ch. 1420, § 1, p. 5238.)15 Our past decisions note deletions

from bills prior to their passage as significant indicia of legislative intent. (E.g.,

Sierra Club v. California Coastal Com. (2005) 35 Cal.4th 839, 852; People v.

Birkett (1999) 21 Cal.4th 226, 240-242; but cf. American Financial Services

Assn. v. City of Oakland (2005) 34 Cal.4th 1239, 1261-1262.)

A traditional rule of statutory construction is that, absent express words to

the contrary, governmental agencies are not included within the general words of a

statute. (E.g., Estate of Miller (1936) 5 Cal.2d 588, 597; Balthasar v. Pacific Elec.

Ry. Co. (1921) 187 Cal. 302, 305.) However, plaintiffs and their amici curiae

invoke a more recent exception to this principle, i.e., that government agencies are

excluded from the operation of general statutory provisions “only if their inclusion

would result in an infringement upon sovereign governmental powers. . . .

Pursuant to this principle, governmental agencies have been held subject to

legislation which, by its terms, applies simply to any ‘person.’ [Citations.]” (City

of Los Angeles v. City of San Fernando (1975) 14 Cal.3d 199, 276-277; see also,

e.g., Nestle v. City of Santa Monica (1972) 6 Cal.3d 920, 933 (Nestle); Flournoy v.

State of California (1962) 57 Cal.2d 497, 498-499; Hoyt v. Board of Civil Service

Commrs. (1942) 21 Cal.2d 399, 402.) In at least one instance, this premise was

applied to a statutory definition of covered “persons” somewhat like that used in

the CFCA. (State of California v. Marin Mun. W. Dist. (1941) 17 Cal.2d 699, 704


15

The current reference to “limited liability company” in the statutory

definition was added to the CFCA by a 1994 amendment. (Stats. 1994, ch. 1010,
§ 141, p. 6088.)

21

[county held subject to statute allowing Department of Public Works to order “any

person” to move his pipeline as necessary for public safety or highway

improvement; statute defined “person” to include “any person, firm, partnership,

association, corporation, organization, or business trust,” and did not expressly

name governmental entities].)

In LeVine I, supra, 68 Cal.App.4th 758, the Court of Appeal held that the

defendant school district was a “person” within the scope of the CFCA, and was

thus subject to CFCA provisions prohibiting retaliation against an employee for

reporting a false claim or furthering a false claims action (Gov. Code, § 12653,

subd. (b)). Invoking the “rule that governmental agencies are excluded from the

general provisions of a statute only if their inclusion would result in an

infringement upon sovereign powers,” the Court of Appeal declined to find that

the CFCA would cause such infringement. (LeVine I, supra, at p. 765.) The Court

of Appeal reasoned that “no government agency has the power, sovereign or

otherwise, knowingly to present a false claim.” (Ibid.)16 In the case before us, the

instant Court of Appeal employed a similar analysis.

We disagree with the ultimate conclusion of LeVine I. In the first place, the

premise that public entities are statutory “persons” unless their sovereign powers

would be infringed is simply a maxim of statutory construction. While the

“sovereign powers” principle can help resolve an unclear legislative intent, it

cannot override positive indicia of a contrary legislative intent. As we have


16

In LeVine II, supra, 90 Cal.App.4th 201, the Court of Appeal affirmed, as

law of the case, its ruling in LeVine I that public school districts are “persons”
subject to suit under the CFCA. The LeVine II court declined to reconsider its
prior holding in light of several intervening federal decisions, including Vermont
Agency of Natural Resources v. United States ex rel. Stevens
(2000) 529 U.S. 765
(Stevens). Stevens held that states are not “persons” subject to qui tam liability
under the federal false claims statute. We discuss Stevens in greater detail below.

22

explained, the language, structure, and history of the particular statute before us—

the CFCA—strongly suggest that public entities, including public school districts,

are not “persons” subject to suit under the law’s provisions. On that basis alone,

we are persuaded that governmental agencies, including the district defendants in

this case, may not be sued under California’s false claims statute.17

Moreover, we do not agree with LeVine I’s analysis of the “sovereign

power” question. Of course school districts have no “sovereign” power or right to

submit false claims against the public treasury. Nonetheless, we cannot accept

LeVine I’s determination that application of the CFCA to public school districts

would infringe no sovereign powers.

As we will explain, in light of the stringent revenue, appropriations, and

budget restraints under which all California governmental entities operate,

exposing them to the draconian liabilities of the CFCA would significantly impede

their fiscal ability to carry out their core public missions. In the particular case of

public school districts, such exposure would interfere with the state’s plenary

power and duty, exercised at the local level by the individual districts, to provide

the free public education mandated by the Constitution.

The People, by initiative, have put all agencies of government, including

school districts, on a strict fiscal diet by adding provisions to the California

Constitution that limit their power to tax and spend. Article XIII A, section 1,


17

We have indicated (ante, fn. 1) that the CFCA provides a single definition

of “person,” governing both who may be sued and who may sue as a qui tam
plaintiff
. In Harris, supra, __ Cal.4th ___, we consider whether public entities are
“persons” for the latter purpose. As we explain in Harris, there is ample evidence
the Legislature did not contemplate public entities as qui tam plaintiffs under the
CFCA. (See Harris, supra, __ Cal.4th at pp. ___-___ [at pp. 11-14].) Given the
statute’s uniform definition of “person,” Harris’s analysis further informs our
conclusion here that public entities also are not “person[s]” subject to suit under
the CFCA.

23

“places a general ceiling on the ad valorem property taxes which may be levied on

behalf of local governments and school districts. [Citation].” (Butt v. State of

California (1992) 4 Cal.4th 668, 691, fn. 17 (Butt).) Article XIII A also bans other

new local taxes levied by, or for the specific benefit of, school and other special

districts except as approved by a two-thirds majority of the voters. (Cal. Const.,

art. XIII A, § 4; see Rider v. County of San Diego (1991) 1 Cal.4th 1, 13-15;

Hoogasian Flowers, Inc. v. State Bd. of Equalization (1994) 23 Cal.App.4th 1264,

1282-1284.) At the state level, article XIII A forbids the enactment of any new ad

valorem real property tax, and prohibits all increases in state taxes except by a

two-thirds vote of each House of the Legislature. (Cal. Const., art. XIII A, § 3.)

Article XIII B generally limits the annual appropriations of state and local

governments to the prior years’ appropriations as adjusted for the cost of living.

(Cal. Const., art. XIII B, § 1.) Under this constitutional provision, these limits

may be changed only by vote of the affected electorate. (Id., § 4.)18

Public school districts face an additional restriction on their ability to tax

and spend for their educational mission. Because disparities in school funding

levels based on the comparative wealth of local districts violate the equal

protection clause of the California Constitution (see Serrano v. Priest (1976)

18 Cal.3d 728; Serrano v. Priest (1971) 5 Cal.3d 584), the Legislature has adopted

a strict system of equalized funding (Ed. Code, § 42238 et seq.), under which, as

noted above, “the amount of property tax revenues a district can raise, with other

specific local revenues, [is] coupled with an equalization payment by the state,

thus bringing each district into a rough [per student] equivalency of revenues.”

18

Article XIII B allows governmental entities to establish reserve,

contingency, emergency, trust, sinking, and other like funds to pay unexpected or
extraordinary expenses. Payments from such funds do not constitute
appropriations subject to limitation, but contributions to such funds do count
against an entity’s appropriations limit. (Cal. Const., art. XIII B, § 5.)

24

(56 Cal.Jur.3d, supra, Schools, § 7, p. 198, fns. omitted.) “In obedience to

Serrano principles, the current system of public school finance largely eliminates

the ability of local districts, rich or poor, to increase local ad valorem property

taxes to fund current operations at a level exceeding their [s]tate-equalized

revenue per average daily attendance. [Citation.]” (Butt, supra, 4 Cal.4th 668,

691, fn. 17.)

School districts must use the limited funds at their disposal to carry out the

state’s constitutionally mandated duty to provide a system of public education.

The Constitution requires, and makes the Legislature responsible for providing, “a

system of common schools by which a free school shall be kept up and supported

in each district . . . .” (Cal. Const., art. IX, § 5.) The Legislature has chosen to

implement this “fundamental” guarantee through local school districts with a

considerable degree of local autonomy, but it is well settled that the state retains

plenary power over public education. (Butt, supra, 4 Cal.4th 668, 680-681.)

Hence, there can be no doubt that public education is among the state’s

most basic sovereign powers. Laws that divert limited educational funds from this

core function are an obvious interference with the effective exercise of that power.

Were the CFCA applied to public school districts, it would constitute such a law.

If found liable under the CFCA, school districts, like other CFCA defendants,

could face judgments—payable from their limited funds—of at least two, and

usually three, times the damage caused by each false submission, plus civil

penalties of up to $10,000 for each false claim, plus costs of suit. Such exposure,

disproportionate to the harm caused to the treasury, could jeopardize a district

financially for years to come. It would injure the districts’ blameless students far

25

more than it would benefit the public fisc, or even the hard-pressed taxpayers who

finance public education.19

The Legislature is aware of the stringent revenue, budget, and

appropriations limitations affecting all agencies of government—and public school

districts in particular. Given these conditions, we cannot lightly presume an intent

to force such entities not only to make whole the fellow agencies they defrauded,

but also to pay huge additional amounts, often into the pockets of outside parties.

Such a diversion of limited taxpayer funds would interfere significantly with

government agencies’ fiscal ability to carry out their public missions.20


19

We note that the Legislature has provided other, detailed means by which

the state may discover and recoup overpayments of state educational funds to local
districts. Thus, as the district defendants and several amici curiae point out, local
districts must undergo independent annual audits (Ed. Code, § 41020), and the
State Controller may also audit local school districts (see id., §§ 14506, 14507,
41344, subd. (e)). If an audit shows the district received an overapportionment
equal to, or greater than, the sum due for even one unit of ADA, the state must
reduce accordingly the total ADA apportionment otherwise due to the district for a
succeeding year. (Id., §§ 41341, 41344.) If a single-year recoupment would
create hardship for the local district, a plan may be implemented for repayment
over a period of up to eight years. (Id., § 41344, subd. (a)(2).) While these
provisions accord the state a strict remedy for funds improperly apportioned to a
local district, they also display the Legislature’s realistic solicitude for the several
financial constraints under which modern California school districts, like all
government agencies, must carry out their vital mission. They are additional
evidence that the Legislature did not intend to apply the CFCA’s draconian
remedies in this context.

20

By statute, “[n]otwithstanding any other provision of law, a public entity is

not liable for damages awarded under [s]ection 3294 of the Civil Code [governing
punitive damages] or other damages imposed primarily for the sake of example
and by way of punishing the defendant.” (Gov. Code, § 818.) One might argue
that the CFCA’s treble-damage provisions are not strictly, or even primarily,
“punitive,” in that they are necessary to ensure both (1) full recovery by the state
or political subdivision against which the false claim was made and (2) due
compensation to the party who undertook the false claim action on behalf of the
defrauded entity. (Cf., e.g., People ex rel. Younger v. Superior Court (1976)
16 Cal.3d 30 [Government Code section 818 did not prohibit assessment, under

26

We note that “ ‘[t]he ultimate purpose of the [CFCA] is to protect the

public fisc.’ ” (State v. Altus Finance (2005) 36 Cal.4th 1284, 1297.) Given that

school district finances are largely dependent on and intertwined with state

financial aid (see Belanger v. Madera Unified School District (9th Cir. 1992)
963 F.2d 248, 251-252 (Belanger)), the assessment of double and treble damages,

as well as other penalties, to school districts would not advance that purpose.

Of course, where liability otherwise exists, public entities must pay legal

judgments from their limited revenues and appropriations, even if they cannot

exceed their tax or appropriations ceilings to do so and must therefore cut

spending in other areas. (See Gov. Code, § 970 et seq.; Ventura Group Ventures,

Inc. v. Ventura Port Dist. (2001) 24 Cal.4th 1089, 1098-1100.) This obligation, in

and of itself, does not infringe their “sovereign powers.” But we may consider the

effect on sovereign powers when we are determining whether the Legislature

intended, by mere implication, to expose a public entity to a particular statutory

liability.

For the reasons we have detailed, we conclude the Legislature did not

intend to subject financially constrained school districts—or any agency of state or


statute expressly applicable to public entities, of civil penalties against port district
for oil spill into estuary; penalties compensated people of state for real, but
unquantifiable, damage from spill]; State Dept. of Corrections v. Workmen’s
Comp. App. Bd.
(1971) 5 Cal.3d 885 [Government Code section 818 did not
prohibit assessment, under statute expressly applicable to public entities, of 50
percent increase in workers’ compensation award otherwise payable by
corrections department because of agency’s serious and willful misconduct, since
employee did not thereby receive more than full compensation for his injuries].)
But the purpose behind the statutory ban on punitive damages against public
entities—to protect their tax-funded revenues from legal judgments in amounts
beyond those strictly necessary to recompense the injured party—applies equally
here. In our view, this is an additional indication that the Legislature did not
intend, without expressly saying so, to apply the CFCA to public entities such as
school districts.

27

local government—to the treble-damages-plus penalties provisions of the CFCA.

We conclude that such entities are not “persons” subject to suit under that statute.

We disapprove LeVine I, supra, 68 Cal.App.4th 758, and LeVine II, supra,

90 Cal.App.4th 201, to the extent they hold otherwise.

Our analysis is not affected by two United States Supreme Court decisions

construing the federal false claims statute (FFCA; 31 U.S.C. § 3729 et seq.)—the

model for California’s law. In Stevens, supra, 529 U.S. 765, the high court

majority held that the several states (including agencies of state governments) are

not “persons” subject to qui tam actions under the FFCA. On the other hand, a

different majority later concluded in Cook County v. United States ex rel.

Chandler (2003) 538 U.S. 119 (Chandler) that certain local governmental entities,

including cities and counties, are “persons” subject to such suits.

The parties hotly dispute whether California school districts are “state”

agencies as to which Stevens might be persuasive, or local governmental entities

that should fall, by analogy, under the rule of Chandler. However, we find little in

either case of direct relevance to the issue before us. Both decisions construe a

federal statute which, in respects material here, is distinct from its California

counterpart. Moreover, both cases apply federal principles of statutory

construction that differ from those used in this state.

The FFCA was originally adopted in 1863 to confront massive contractor

fraud during the Civil War. (Stevens, supra, 529 U.S. 765, 781.) As enacted and

since amended, the federal statute, like California’s, makes “persons” liable for

submitting false claims to the government (31 U.S.C. § 3729), but, unlike the

California statute, the federal version includes no definition of covered “persons.”

In Stevens, the majority noted that the statute had never indicated it applied to

states. Thus, the majority applied a “longstanding interpretive presumption,” for

28

purposes of federal law, “that ‘person’ does not include the sovereign.

[Citations.]” (Stevens, supra, at p. 780.)

Further, the Stevens majority pointed to a separate section of the FFCA—

one also with no California parallel—allowing the Attorney General to serve civil

investigative demands upon “persons.” (31 U.S.C. § 3733(a)(1).) As the majority

observed, “persons” were defined, for purposes of that section, to include the state

(id., § 3733(l)(4)), thus suggesting states were excluded for other purposes.

(Stevens, supra, 529 U.S. 765, 783-784.) The majority also cited a similar federal

law, the Program Fraud Civil Remedies Act of 1986 (PFCRA), which was adopted

just prior to the substantial 1986 amendments to the federal false claims act, and

carried lesser penalties. As the majority noted, the PFCRA contains a definition of

“persons” that does not include states. It would be anomalous, the majority

concluded, for Congress to subject states—generally considered immune from

“punitive” damages—to the greater false-claims penalties but not the lesser ones

provided by the PFCRA. (Stevens, supra, at pp. 786-787.)

In Chandler, a qui tam plaintiff brought a federal false claims action against

the county owner-operator of a hospital, alleging that the hospital submitted

falsified compliance documents to obtain federal research funds. The county

moved to dismiss, asserting it was not a “person” covered by the FFCA. On

authority of Stevens, the district court agreed and dismissed the action. The court

of appeals reversed, concluding that Stevens did not apply to the county. The

United States Supreme Court affirmed the court of appeals.

In distinguishing Stevens, as had the court of appeals, the Chandler

majority applied a different presumption of federal statutory construction—one

also in effect since the Civil War inception of the FFCA. This presumption, the

majority explained, is that, where not specifically defined, the word “person”

encompasses “artificial persons” such as “corporations” (Chandler, supra,

29

538 U.S. 119, 125-126), including both “full-fledged municipal corporations,”

such as towns and cities, that were incorporated at the request of their inhabitants,

and “quasi-corporations,” such as counties, that were created unilaterally by the

state (id. at p. 127, fn. 7).

The Chandler majority acknowledged that the 1986 amendments had added

treble-damage and penalty provisions to the Civil War-era statute, and also

conceded the presumption against subjecting government entities to “punitive”

damages. However, the Chandler majority observed, there were remedial,

nonpunitive aspects to the 1986 damage and penalty provisions. In any event, the

majority concluded, given the strong presumption against repeal by implication,

the modern addition of arguably “punitive” damages to the FFCA could not be

considered a silent reversal of the historical assumption that this statute includes

municipalities. (Chandler, supra, 538 U.S. 119, 129-134.)

As noted above, when the issue is whether government entities are

“persons” covered by a particular statutory scheme, California courts apply

interpretive principles somewhat different from those detailed in Stevens and

Chandler. Under California law, absent contrary indicia of legislative intent,

statutory “persons” are deemed to include governmental entities, both state and

local, unless such inclusion would infringe the entities’ exercise of their sovereign

powers and duties. California’s false claims statute, unlike the federal version,

defines covered “persons,” and does so in a way that suggests an intent not to

include government entities. Other indicia of legislative purpose also support this

conclusion. And for reasons we have detailed, application of the CFCA’s treble-

damages-plus-penalties requirement to public school districts would place severe

and disproportionate financial constraints on their ability to provide the free

education mandated by the Constitution—a result the Legislature cannot have

intended. Nothing in Stevens or Chandler changes our conclusions in this regard.

30

Equally beside the point are federal and California decisions holding that

California school districts are “arms of the state,” and thus enjoy the state’s

sovereign immunity, under the Eleventh Amendment, from suits in federal court.

(E.g., Belanger, supra, 963 F.2d 248, 250-251 [civil rights action under

42 U.S.C.A. § 1983]; Kirchmann v. Lake Elsinore Unified School District (2000)

83 Cal.App.4th 1098, 1100-1102, 1105-1115 [entity with Eleventh Amendment

immunity also enjoys immunity from state court suits under 42 U.S.C. § 1983];

also cf. U.S. ex rel. Ali v. Daniel, Mann, Johnson (9th Cir. 2004) 355 F.3d 1140,

1147 [five-pronged “arm of the state” test is appropriate for determining whether

government entity enjoys immunity from federal false claims liability under

Stevens].) When we decide whether the California Legislature intended a

California statute to include or exclude California government entities, we are not

concerned with issues of federalism, constitutional or statutory.

Nothing in decisions addressing such issues precludes us from holding, for

the reasons we have explained, that there was no legislative intent to apply the

CFCA to public school districts. We conclude that neither such districts, nor any

other agencies of state and local government, are “persons” subject to suit under

the CFCA.21


21

The State of California argues that a public school district should be

deemed a “person” under the CFCA, and thus liable under that statute for false
claims against state education funds, unless any CFCA judgment against the
district would essentially be paid from state funds, in which case the district should
be considered an “arm of the state” and thus exempt. Whether a CFCA judgment
against a district would be paid from state funds is a case-by-case determination,
the state urges, and the instant record lacks information from which we may make
such a determination in this case. Hence, the state asserts, a remand to the trial
court is required. We are not persuaded. Under the revenue equalization system
of California school finance, any judgment finding the district liable for a false
claim against state funds will necessarily be paid, at least in part, from funds
originally derived from the state. Indeed, the district defendants have urged that
there is no purpose in holding them to CFCA liability in this regard, because the

31

5. May charter schools and their operators be sued under the CFCA?

Though we have disagreed with the Court of Appeal about whether the

district defendants are “persons” subject to CFCA actions, we have little difficulty

upholding the Court of Appeal’s determination that the charter school defendants

are “persons” who may be liable under the CFCA.22

The CFCA expressly defines “persons” to include “corporations” and

“limited liability companies,” as well as, among other things, “organizations” and

“associations.” (Gov. Code, § 12650, subd. (b)(5).) The statute includes no

exemption, either in the definitional section or elsewhere, for “corporations”

organized under the Nonprofit Public Benefit Corporation Law (Corp. Code,

§ 5110), or for “corporations,” “limited liability companies,” “organizations,” or

“associations” that operate charter schools under the CSA.

The instant complaint alleges, and apparently there is no dispute, that

defendants One2One, CSRA, Sierra Summit Academy, and Camptonville

Academy are corporations. Moreover, Mattole Valley School, though apparently

not itself a corporation, is alleged to be operated by corporations, and is certainly

an “organization” within the meaning of the statutory definition.


district’s satisfaction of a CFCA judgment would, in effect, constitute “the state
paying itself.” We need not immerse ourselves in this thicket. For the reasons we
have explained, we are satisfied that the Legislature did not intend to impair
districts’ financial ability to carry out their public educational mission on behalf of
the state by exposing them to the harsh monetary sanctions of the CFCA.

Finally, the analysis we have adopted makes it unnecessary to reach the

district defendants’ claims that they are immune from liability under various
provisions of the TCA (Gov. Code, § 815 et seq.)

22

As indicated above, the charter school defendants, as so labeled for

purposes of this opinion, include the schools themselves, in whatever legal form
they are operated, as well as all other entities having legal form, other than the
district defendants, which entities are named in the complaint as having direct or
indirect responsibility for, or control of, the operation of such schools.

32

Nonetheless, the charter school defendants insist that, by virtue of the CSA,

they are entitled to any “public entity” immunity enjoyed by their chartering

districts. The charter school defendants point to various declarations in the CSA

that charter schools are “part of the Public School System as defined in [a]rticle IX

of the California Constitution” (Ed. Code, § 47615, subd. (a)(1)),23 are “under the

jurisdiction of the Public School System and the exclusive control of the officers

of the public schools” (id., subd. (a)(2)), and, for specified purposes of funding,

are “deemed to be . . . ‘school district[s]’ ” (id., § 47612, subd. (c); see also id.,

§ 47650).24

We are not persuaded. Though charter schools are deemed part of the

system of public schools for purposes of academics and state funding eligibility,

and are subject to some oversight by public school officials (see Wilson, supra,

75 Cal.App.4th 1125, 1136-1142), they are operated, not by the public school

system, but by distinct outside entities— including nonprofit public benefit

corporations with independent legal identities (see Ed. Code, § 47604, subd. (a);


23

Article IX, section 6 of the California Constitution defines the Public

School System to “include all kindergarten schools, elementary schools, secondary
schools, technical schools, and State colleges, established in accordance with law
and, in addition, the school districts and the other agencies authorized to maintain
them.”

24

Education Code section 47612, subdivision (c), states that charter schools

are deemed to be school districts for purposes of (1) Education Code sections
14000 through 14058 (concerning appropriations, disbursements, and
apportionment from the State School Fund to local districts based on ADA),
41301 (concerning apportionment formulas based on ADA), 41302.5 (defining
“school districts” for purposes of article XVI, sections 8 and 8.5, of the California
Constitution, which sections earmark levels of state funding for public schools),
41850 through 41857 (concerning apportionment from the State School Fund for
home-to-school transportation), and 47638 (concerning charter schools’ eligibility
for State Lottery funds based on ADA), and (2) article XVI, sections 8 and 8.5 of
the California Constitution.

33

Corp. Code, §§ 5000 et seq., 5110 et seq.)—that are given substantial freedom to

achieve academic results free of interference by the public educational

bureaucracy. The sole relationship between a charter school operator and the

chartering district is through the charter governing the school’s operation. Except

in specified respects, charter schools and their operators are “exempt from the

laws governing school districts.” (Ed. Code, § 47610.)

The autonomy, and independent responsibility, of charter school operators

extend, in considerable degree, to financial matters. Thus, where a charter school

is operated by a nonprofit public benefit corporation, the chartering authority is

not liable for the school’s debts and obligations. (Id., § 47604, subd. (c).) A 2003

amendment to the CSA makes clear that the chartering authority’s immunity from

financial liability for a charter school extends to “claims arising from the

performance of acts, errors, or omissions by the . . . school, if the authority has

complied with all oversight responsibilities required by law.” (Ibid.)

The CFCA was designed to help the government recover public funds of

which it was defrauded by outside entities with which it deals. There can be little

doubt the CFCA applies generally to nongovernmental entities that contract with

state and local governments to provide services on their behalf. The statutory

purpose is equally served by applying the CFCA to the independent corporations,

organizations, and associations that receive public monies under the CSA to

operate schools on behalf of the public education system.

On the other hand, we conclude, the sovereign power over public education

is not infringed by application of the CFCA, including its treble-damages-plus-

penalties provisions, to independent charter school operators. As we have seen,

public school districts are the entities fundamentally responsible for operating the

system of free public education required by the Constitution. The districts’

continuing financial ability to carry out this mission at basic levels of adequacy is

34

thus critical to satisfying the state’s free public school obligation. (See Butt,

supra, 4 Cal.4th 668, 678-692.) Accordingly, we have concluded that the

Legislature did not intend to undermine this sovereign obligation by exposing

public school districts to the harsh monetary sanctions of the CFCA.

But the CSA assigns no similar sovereign significance to charter schools or

their operators. Under that statute, the term of a charter cannot exceed five years,

subject to renewal. (Ed. Code, § 47607, subd. (a)(1).) The grant and renewal of

charters are dependent upon satisfaction of statutory requirements, including

attainment of specific educational goals. (Id., subds. (b), (c); see also id.,

§ 47605.) A charter may be revoked for material violations of the law or charter,

failure to meet pupil achievement goals, or fiscal mismanagement. (Id., § 47607,

subd. (d).) If a charter school ceases to exist, its pupils are reabsorbed into the

district’s mainstream public schools, and the ADA revenues previously allotted to

the charter school for those pupils revert to the district.

The CSA was adopted to widen the range of educational choices available

within the public school system. That is a salutary policy. Yet application of the

CFCA’s monetary remedies, however harsh, to a particular charter school or its

operator presents no fundamental threat to maintenance, within the affected

district, of basically adequate free public educational services. Thus, application

of the CFCA to charter school operators cannot be said to infringe the exercise of

the sovereign power over public education.

This being so, there is no reason to conclude that the charter school

defendants are not “persons” within the definition expressly set forth in the CFCA.

In our view, they are such “persons,” and they may be held liable under the terms

of that statute if they submit false claims for state or district educational funds.25


25

Defendants Camptonville Academy and Jablecki insist that application of

the CFCA to charter schools and their operators would violate constitutional and

35

6. May charter schools and their operators be sued under the UCL?

The Court of Appeal determined that the charter school defendants are not

“persons” subject to suit under the UCL. But reasons similar to those applicable

under the CFCA persuade us the Court of Appeal erred in this respect.


statutory mandates that state school funds be separately apportioned and
maintained. (Citing Cal. Const., art. XVI, § 8, subd. (a) [“From all state revenues
there shall first be set apart the moneys to be applied by the state for support of the
public school system”]; see also id., § 8.5 [referring to this separate fund as the
State School Fund]; Ed. Code, § 14040 [State Controller shall keep separate
account of State School Fund].) This would require, these defendants assert, that
money falsely received from the State School Fund must revert to that account
alone when recovered from the false claimant. Yet, they observe, the CFCA
provides, in subdivision (j) of Government Code section 12652, that “[p]roceeds
from the action or settlement of [a CFCA] claim by the Attorney General” shall be
deposited into a different fund, the False Claims Fund created by the same
subdivision, and shall be used by the Attorney General, upon appropriation by the
Legislature, for ongoing investigation and prosecution of false claims. We are not
persuaded by this hypertechnical argument. Even assuming that the premise
advanced by these defendants is correct (i.e., funds falsely received from the State
School Fund must revert only to that fund), subdivision (j), reasonably read, does
not provide otherwise. As noted, the CFCA specifies recovery of double or triple
the amount falsely received. (Gov. Code, § 12651, subds. (a), (b).) From this total
amount, the Attorney General, local prosecuting authority, and/or qui tam plaintiff,
receive percentage “cuts” (id., § 12652, subd. (g)(1)-(5)), with the remainder
“revert[ing] to the state [or] the political subdivision” (id., subd. (g)(6)).
Elsewhere than in subdivision (j), section 12652 makes clear that the Attorney
General, or a local prosecuting authority, is to use that officer’s “cut” of the
proceeds for ongoing investigation and prosecution of false claims. (Id.,
subd. (g)(1)(A), (B), (2).) In this context, subdivision (j), when referring to
“[p]roceeds from the action or settlement of the claim by the Attorney General,”
means only the Attorney General’s “cut” of the total amount recovered in the
action or settlement, leaving the remainder for reversion to the public fund,
treasury, or account—general or specific—from which it was falsely obtained. In
providing for double or treble recovery, the CFCA seeks to ensure that the “cuts”
awarded to the public or private parties who prosecute false claims actions will not
prevent the defrauded treasury itself from obtaining full recovery of the funds
actually lost to the false claim. We see in this scheme no violation of the
constitutional and statutory provisions cited by Camptonville Academy and
Jablecki.

36

In language similar to the CFCA’s, the UCL defines “persons” subject to

that law to “mean and include natural persons, corporations, firms, partnerships,

joint stock companies, associations and other organizations of persons.” (Bus. &

Prof. Code, § 17201.) The charter school defendants either are, or are operated by,

corporations, and they also constitute “associations” or “organizations.” They are

within the plain meaning of the statute.

Noting that several cases have held government entities are not “persons”

who may be sued under the UCL (e.g., Community Memorial Hospital v. County

of Ventura (1996) 50 Cal.App.4th 199, 209 (Community Memorial); see also

People for the Ethical Treatment of Animals, Inc. v. California Milk Producers

Advisory Bd. (2005) 125 Cal.App.4th 871, 877-883; California Medical Assn. v.

Regents of University of California (2000) 79 Cal.App.4th 542, 551; Trinkle v.

California State Lottery (1999) 71 Cal.App.4th 1198, 1203-1204; Janis v.

California State Lottery Com. (1998) 68 Cal.App.4th 824, 831; Santa Monica Rent

Control Bd. v. Bluvshtein (1991) 230 Cal.App.3d 308, 318; but see Notrica v.

State Comp. Ins. Fund (1999) 70 Cal.App.4th 911, 939-945), the charter school

defendants insist they are entitled, as part of the public school system, to this

“public entity” exemption.26 The Court of Appeal agreed. We do not.

As we have indicated, charter schools are operated, pursuant to the CSA, by

nongovernmental entities. Though, by statutory mandate, these institutions are an

alternative form of public schools financed by public education funds, they and

their nongovernmental operators are largely free and independent of management

and oversight by the public education bureaucracy. Indeed, charter schools

compete with traditional public schools for students, and they receive funding


26

Plaintiffs made no UCL claim against the school district defendants.

Hence, whether governmental entities, as such, are “persons” covered by the UCL
is not at issue in this appeal.

37

based on the number of students they recruit and retain at the expense of the

traditional system. Insofar as their nongovernmental operators use deceptive

business practices to further these efforts, the purposes of the UCL are served by

subjecting them to the provisions of that statute.

Nor is the state’s sovereign educational function thereby undermined. Even

if governmental entities, in the exercise of their sovereign functions, are exempt

from the UCL’s restrictions on their competitive practices (see Community

Memorial, supra, 50 Cal.App.4th 199, 209-211 [county was not “person” for

purposes of UCL, such that county hospital’s treatment of paying patients in

competition with private hospitals would be subject to statute], no reason appears

to apply that principle to nongovernmental entities, covered by the plain terms of

the statute, who compete with the traditional public schools for students and

funding. We conclude that the charter school defendants are “persons” covered by

the UCL.27


7. Did statutory restrictions on independent study programs apply to


charter schools before Education Code section 51747.3 was amended in 1999?

The Court of Appeal agreed with the trial court that plaintiffs may not

pursue, as part of their CFCA cause of action, allegations that the charter school

defendants claimed ADA funding in violation of the “independent study”

requirements of Education Code section 51747.3. The appellate court reasoned

that section 51747.3 applied to charter schools only after a 1999 amendment,

effective in 2000, and that all the pertinent allegations of the complaint preceded

this effective date. We conclude, contrary to the Court of Appeal, that section


27

We do not, however, decide whether the particular allegations of plaintiffs’

complaint state a cause of action under the UCL. That issue is beyond the scope
of this appeal.

38

51747.3, as in effect before 2000, did include charter schools. Our analysis

proceeds against the following backdrop.

In 1989, article 5.5 (§ 51745 et seq.), dealing with independent study

programs, was added to title 2, part 28, division 4, chapter 5 of the Education

Code. (Stats.1989, ch. 1089, § 5, p. 3775.)28 Section 51745, subdivision (a),

provides that, beginning with the 1990-1991 school year, local school districts

may offer independent study programs “to meet the educational needs of pupils in

accordance with the requirements of this article.”

Three years later, in 1992, the Legislature enacted the CSA. One section of

that law, Education Code section 47610, provided that a charter school must

comply with its charter, but was “otherwise exempt from the laws governing

school districts except as specified in [s]ection 47611 [dealing with participation

in the State Teacher’s Retirement System].” (Stats. 1992, ch. 781, § 1, p. 3760.)

Since its inception, the CSA has further stated that, with specified exceptions,

“[a]dmission to a charter school shall not be determined according to the place of

residence of the pupil, or of his or her parent or guardian, within this state.” (Ed.

Code, § 47605, subd. (d)(1).)

In 1993, Education Code section 51747.3 was added to the independent

study provisions. (Stats. 1993, ch. 66, § 32, p. 923.) As then enacted, section

51747.3 provided that “[n]o local education agency may claim state funding for

the independent study of a pupil . . . if the agency has provided any funds or other

thing of value to the pupil or his or her parent or guardian that the agency does not

provide to students who attend regular classes or to their parents or guardians.”

(Stats. 1993, ch. 66, § 32, p. 923 adding Ed. Code, § 51747.3, subd. (a), italics


28

A former article 5.5, also dealing with independent study, was

simultaneously repealed. (Stats. 1989, ch. 1089, § 4, p. 3775.)

39

added.) Further, the new statute specified that “[n]otwithstanding any other

provision of law, . . . independent study average daily attendance shall be claimed

by school districts and county superintendents of schools only for pupils who are

residents of the county in which the apportionment claim is reported, or . . . of a

county immediately adjacent to [such] county . . . .” (Id., adding § 51747.3,

subd. (b), italics added.) Finally, the statute stated that “[t]he provisions of this

section are not subject to waiver by the State Board of Education, by the State

Superintendent of Public Instruction, or under any provision of Part 26.8 [of the

Education Code] (commencing with [s]ection 47600) [i.e., the CSA].” (Id.,

adding § 51747.3, subd. (d), italics added.)

A 1995 Attorney General’s opinion concluded that Education Code section

51747.3’s restrictions on the provision of special “funds or other thing[s] of value”

to independent study pupils applied to charter schools. The opinion observed that

although, in section 47610, the CSA purported to exempt charter schools from all

but a few specified school district laws, subdivision (d) of section 51747.3

expressly provided that the provisions of that statute could not be waived under

the CSA.

As the opinion indicated, “[w]hatever may comprise the ‘laws governing

school districts’ from which charter schools are exempt, it is clear that for

purposes of the state funding of independent study programs, a charter school

must comply with the particular requirements of [Education Code] section

51747.3. The last sentence of subdivision (d) of section 51747.3 would otherwise

be devoid of meaning, contrary to the rule of statutory construction that every

word, phrase, sentence and part of a statute must be accorded significance if

reasonably possible. [Citations.]” (78 Ops.Cal.Atty.Gen. 253, 257-258 (1995).)29


29 The opinion concluded, however, that the “things of value” referred to in
Education Code section 51747.3, subdivision (a), did not include special

40

In 1996, the Legislature amended Education Code section 47610, part of

the CSA, to add certain additional statutes to the list of laws from which charter

schools, in derogation of the general rule, were not exempt. (Stats. 1996, ch. 786,

§ 5.) Section 51747.3 was not included.

In this setting, the Legislature amended Education Code section 51747.3 in

1999. (Stats. 1999, ch. 162, § 2.) As amended in 1999, subdivision (a) of section

51747.3 specifies that “[n]otwithstanding any other provision of law,” “charter

schools” are among the “local educational agencies” barred from claiming state

funding for pupils who have received “funds or other things of value” not

provided to regular classroom students. (Stats. 1999, ch. 162, § 2.) A new

sentence in subdivision (a) further declares that “[a] charter school may not claim

state funding for the independent study of a pupil . . . if the charter school has

provided any funds or other thing of value to the pupil or his or her parent or

guardian that a school district could not legally provide to a similarly situated

pupil of the school district, or to his or her parent or guardian.” In subdivision (b),


educational materials, such as laptop computers and other learning aids, for the
purpose of facilitating independent study in particular. Noting that the resources
necessary for independent study are inherently different from those appropriate to
the classroom setting, the opinion concluded that “[s]ection 51747.3 may not be
construed as limiting the educational resources of an independent study program
expressly intended by the Legislature” to expand educational choices and
opportunities. (78 Ops.Cal.Atty.Gen., supra, at pp. 259-260.) Such a result, the
opinion asserted, would be “absurd.” (Id. at p. 260.) The statute’s legislative
history, the opinion observed, revealed “[n]othing [to] suggest that educational
resources are to be withheld from students in an independent study program under
the circumstances presented. Rather, the language of section 51747.3, subdivision
(a), was adopted to prevent schools from offering ‘sign up bonuses’ to the parents
of home study children in order for the schools to obtain state funding for the
attendance of the children in their independent study programs. The prohibition
was intended to prevent schools from offering incentives unrelated to education,
not to preclude schools from spending funds on special educational aids and
materials for independent study students.” (Ibid.)

41

the amendment added “charter schools” to “school districts” and “county

superintendents of schools” as entities ineligible to claim state apportionment

funds for independent study pupils who reside outside the county from which the

apportionment claim is reported, or an adjacent county. (Stats. 1999, ch. 162,

§ 2.)30

The Legislative Counsel’s Digest for Senate Bill No. 434 (1999-2000 Reg.

Sess.) (Senate Bill No. 434), which incorporated the 1999 amendment to

Education Code section 51747.3, stated that the amendment (1) “would make . . .

applicable to charter schools” the preexisting statutory restriction on ADA funding

for independent study students who have received money or things of value not

provided to traditional classroom students, (2) “would apply . . . also to charter

schools” the preexisting ban on ADA funding for independent study students who


30

As amended in 1999, Education Code section 51747.3 read, in pertinent

part, as follows (added language in italics, omissions noted by brackets): “(a)
[No] Notwithstanding any other provision of law, a local education agency,
including, but not limited to, a charter school,
may not claim state funding for the
independent study of a pupil . . . if the agency has provided any funds or other
thing of value to the pupil or his or her parent or guardian that the agency does not
provide to pupils who attend regular classes or to their parents or guardians. A
charter school may not claim state funding for the independent study of a pupil . . .
if the charter school has provided any funds or other thing of value to the pupil or
his or her parent or guardian that a school district could not legally provide to a
similarly situated pupil of the school district, or to his or her parent or guardian.

[¶] (b) Notwithstanding paragraph (1) of subdivision (d) of Section 47605 or any
other provision of law, community school and independent study average daily
attendance shall be claimed by school districts [and], county superintendents of
schools, and charter schools only for pupils who are residents of the county in
which the apportionment claim is reported, or who are residents of a county
immediately adjacent to the county in which the apportionment claim is reported.
[¶] . . . [¶] (d) . . . The provisions of this section are not subject to waiver by the
State Board of Education, by the State Superintendent of Public Instruction, or
under any provision of Part 26.8 (commencing with Section 47600).” (Stats.
1999, ch. 162, § 2.) A 2003 amendment substituted “educational” for “education”
between “local” and “agency.” (Stats. 2003, ch. 529, § 4.)

42

live outside the county in which funding is sought, or an adjacent county, and (3)

would additionally prevent charter schools from receiving ADA funding for

independent study pupils to whom they provided money or things of value which a

school district could not legally provide to similarly situated students.

In concluding that the 1999 amendment extended Education Code section

51747.3 to charter schools for the first time, the Court of Appeal cited (1) the

CSA’s express exemption of charter schools from all but a few specified

provisions governing school districts, (2) the express CSA provision that charter

school enrollment cannot be limited by residence, (3) the 1999 amendment’s

express addition of charter schools to the entities subject to section 51747.3, and

(4) the Legislative Counsel’s Digest quoted above. The concurring and dissenting

opinion applies a similar analysis. But that approach overlooks language section

51747.3 has contained since its adoption in 1993—i.e., that its provisions are not

subject to waiver under the CSA.

As the Attorney General observed in his 1995 opinion, the only possible

meaning of this language is that, from and after the effective date of the 1993

enactment, charter schools were, and remain, subject to the statutory restrictions

on independent study programs then set forth in that law. Any other conclusion

would deprive this phrase of significance, contrary to the principle of statutory

construction that interpretations which render any part of a statute superfluous are

to be avoided. (E.g., In re Young (2004) 32 Cal.4th 900, 907; Hunt v. Superior

Court (1999) 21 Cal.4th 984, 1002; People v. Aguilar (1997) 16 Cal.4th 1023,

1030.)

This construction of Education Code section 51747.3 does not overlook

certain provisions of the CSA, noted by the Court of Appeal, and by the

concurring and dissenting opinion, which were already in effect in 1993, including

sections 47605 (eligibility for enrollment in particular charter school not to be

43

determined by residence) and 47610 (charter school exempt from laws governing

school districts except as expressly provided). In harmonizing the disparate, and

sometimes discordant, statutory provisions, we are guided by the maxim that,

where statutes are otherwise irreconcilable, later and more specific enactments

prevail, pro tanto, over earlier and more general ones. (See, e.g., Pacific Lumber

Co. v. State Water Resources Control Bd. (2006) 37 Cal.4th 921, 942-943 (Pacific

Lumber); Stop Youth Addiction, Inc. v. Lucky Stores, Inc. (1998) 17 Cal.4th 553,

568; Department of Alcoholic Beverage Control v. Alcoholic Beverage Control

Appeals Bd. (1999) 71 Cal.App.4th 1518, 1524.)

Applying those principles, we conclude that the 1993 version of Education

Code section 51747.3, including its provision for nonwaiver under the CSA, is a

more recent and specific enactment on the subjects it addresses than the pertinent

provisions of sections 47605 and 47610. The latter statutes, enacted in 1992,

provided generally that charter schools were exempt from most school district

laws and must accept nonresident students. But section 51747.3 later placed

restrictions, including residence restrictions, on the circumstances under which

charter schools, like other public schools, could obtain ADA funding for

independent study programs and pupils in particular. To that extent, section

51747.3 superseded the earlier statutes. Indeed, section 51747.3 has always

expressly provided that its residency restrictions apply notwithstanding any other

provision of law. (Id., subd. (b).)31

We are not persuaded otherwise by the 1996 amendment to Education Code

section 47610, which added certain statutes to the list of laws from which charter


31

We have found nothing in the contemporaneous legislative history of

Senate Bill No. 399 (1993-1994 Reg. Sess.), through which Education Code
section 51747.3 was first adopted, that adds or detracts from the conclusion that
the section was intended, from its inception, to apply to charter schools.

44

schools are not exempt, but did not include section 51747.3. Section 51747.3, by

its express terms, already applied to charter schools. There was no need to say so

again in section 47610.

Nor are we dissuaded by the language, the Legislative Counsel’s Digest, or

the legislative history32 of the 1999 amendment to Education Code section

51747.3, insofar as they might suggest the 1999 Legislature believed charter

schools were being added to the statute for the first time. A later expression of

legislative purpose is not binding as to what prior legislation meant when it was

adopted. (E.g., Pacific Lumber, supra, 37 Cal.4th 921, 940; Cummins, Inc. v.

Superior Court (2005) 36 Cal.4th 478, 492.) We therefore conclude that the

restrictions on independent study programs set forth in the 1993 version of

Education Code section 51747.3 applied to charter schools even prior to the 1999

amendment.33

32

See, e.g., the Senate Education Committee’s analysis of Senate Bill No. 434

as amended June 28, 1999, pages 1-2.

33

As originally adopted in 1993, Education Code section 51747.3 referred to

“local education agenc[ies],” “school districts,” and “county superintendents of
schools,” but not specifically to charter schools, as entities precluded from
claiming state funds for independent-study pupils under the circumstances
described in the statute. (Stats. 1993, ch. 66, p. 923.) However, nothing in the
1993 version of the section indicated that these provisions, as in effect prior to
2000, did not apply equally to the independent-study pupils of charter schools
operating under the jurisdiction of the “local education agencies,” “school
districts,” and “county superintendents of schools” responsible for claiming state
funds on behalf of such schools. In 1999, section 51747.3 was amended, among
other things, expressly to include charter schools among the “local education
agencies” covered by the section, and to place charter schools within the statute’s
limitations on claiming state funds for independent-study pupils. (Stats. 1999, ch.
162, § 2.) But it appears this express statement of limitations on charter schools’
ability to claim state funding was simply part of a contemporaneous overhaul of
the way charter schools were funded in general. Another 1999 measure, Assembly
Bill No. 1115 (1999-2000 Reg. Sess.) (Assembly Bill No. 1115)—a trailer to the
1999 Budget Bill—added section 47651, providing that a charter school may elect
to receive its share of state funding directly, rather than through the “local

45

Plaintiffs’ CFCA cause of action appears properly tailored to the pre-1999

version of the statute. The complaint alleges that the charter school defendants

submitted false ADA claims for independent study pupils who (1) received “funds

or other thing[s] of value” not provided to classroom students, and (2) resided

outside the counties designated by the statute. The trial court and the Court of

Appeal thus erred in holding that plaintiffs’ “independent study” claims were

barred because Education Code section 51747.3 did not apply to charter schools

until it was amended in 1999.34




educational agency” under which it operates. (Stats. 1999, ch. 78, § 32.8.) The
legislative history of Senate Bill No. 434, by which section 51747.3 was amended,
made specific reference to the change in funding methodology adopted in
Assembly Bill No. 1115. (See Sen. Com. on Education, analysis of Sen. Bill No.
434, as amended June 28, 1999, p. 4.) Under these circumstances, it became
logical for section 51747.3 to mention charter schools directly as claimants of
state funds
. In sum, we are not persuaded that either the pre-1999 version of
section 51747.3, or the 1999 amendments to that section, evidence the
Legislature’s intent to exclude charter schools, prior to 2000, from this statute’s
funding restrictions on independent-study programs.

34 We realize the 1999 amendment to Education Code section 51747.3 did not
simply insert “charter schools” as entities subject to the 1993 version of the
statute. The amendment also added that “[a] charter school may not claim state
funding for the independent study of a pupil, whether characterized as home study
or otherwise, if the charter school has provided any funds or other thing of value to
the pupil or his or her parent or guardian that a school district could not legally
provide to a similarly situated pupil of the school district, or to his or her parent
or guardian
.” (Stats. 1999, ch. 162, § 2, italics added.) This new sentence may
apply restrictions to charter school independent study programs beyond those
imposed by the original version of the statute. We need not address that issue,
however, because plaintiffs’ complaint is not framed in the terms of this amended
language. Moreover, we need not consider whether special educational materials
may be provided to independent study pupils, though not to classroom students,
without violating the “funds or other thing[s] of value” proscription in the original
version of the statute, as suggested by the 1995 Attorney General’s opinion. That
question is beyond the scope of the issues presented by this appeal.

46

8. Is plaintiffs’ CFCA claim barred as one for “educational

malfeasance”?

The complaint alleges that the charter school defendants submitted false

claims to obtain ADA funds for pupils who “were not [actually] students enrolled

in and receiving instruction, educational materials, or services from [the

defendants’] schools.” As noted above, the gravamen of this claim is that, in the

operation of their distance learning schools, the defendants did little more than

collect attendance forms from their ostensible pupils, while failing to provide the

educational services, equipment, and supplies promised in the schools’ charters

and promotional materials, and required by law. Among other things, the

complaint asserts that the defendants overcharged for educational software readily

available from other sources, never furnished promised computers for online

learning and testing at home, and failed to provide the services of “educational

facilitators” who, for each student, were supposed to order necessary equipment

and supplies, develop an individualized curriculum plan, and make weekly home

visits for personal instruction, testing, and evaluation.

The trial court concluded that these were all impermissible claims for

“educational malfeasance” (see Peter W., supra, 60 Cal.App.3d 814), but the

Court of Appeal disagreed. The Court of Appeal reasoned that the complaint’s

allegations required no judgments about the methodology or quality of defendants’

educational services—a matter upon which reasonable persons could disagree.

Rather, the appellate court observed, the complaint presented only the

“straightforward and comprehensible” claim that the defendants defrauded the

state by collecting public education funds for pupils to whom they provided no

service beyond the timely collection of attendance forms.

We agree in principle with the Court of Appeal. Insofar as the complaint

alleges, not that the defendants provided a substandard education, but instead that

47

they (1) offered no significant educational services, (2) did, or failed to do,

specific, quantifiable acts in violation of their charters or applicable law, or

(3) improperly caused students, parents, or guardians to incur monetary charges or

overcharges for particular educational materials and equipment supplied by or

through the defendants, it does not state a barred claim for educational

malfeasance. We explain our reasoning in detail.

In Peter W., supra, 60 Cal.App.3d 814, an 18-year-old former public school

student sued his school district, asserting causes of action for negligence, breach of

mandatory duty, and fraud. The complaint alleged as follows: The district

“negligently and carelessly” failed to perceive the plaintiff’s learning disabilities,

assigned him to classes beyond his reading abilities with instructors unqualified to

meet his special needs, passed him from grade to grade with knowledge that he

had not achieved necessary skills, and permitted him, in violation of state law, to

graduate even though he could not read above the eighth grade level. During this

time, the district made representations to plaintiff’s mother, which representations

the district knew were false or had no basis to believe were true, that he was

performing at or near his grade level. As a result, he graduated with fifth grade

reading and writing skills, thus permanently limiting his employment opportunities

and earning capacity.

Defendant’s demurrer was sustained, the suit was dismissed, and the

plaintiff appealed. The Court of Appeal affirmed. The court concluded that the

complaint failed to allege the district’s breach of a duty the law would recognize.

As the court noted, “classroom methodology affords no readily acceptable

standards of care, or cause, or injury.” Pedagogical science, the court observed, is

“fraught with different and conflicting theories” about how children should be

taught; moreover, educational success or failure “is influenced by a host of

factors,” both personal and external, “which affect the pupil subjectively” and

48

often are beyond the control of educators. (Peter W., supra, 60 Cal.App.3d 814,

824.) “We find in this situation,” said the court, “no conceivable ‘workability of a

rule of care’ against which defendants’ alleged conduct may be measured

[citation], no reasonable ‘degree of certainty that . . . plaintiff suffered injury’

within the meaning of the law of negligence [citation], and no such perceptible

‘connection between the defendant’s conduct and the injury suffered,’ as alleged,

which could establish a causal link between them within the same meaning

[citation].” (Id. at p. 825.)

Peter W. also identified other public policy considerations, “even more

important in practical terms,” that counsel against an “actionable ‘duty of care’ in

persons and agencies who administer the academic phases of the public

educational process.” (Peter W., supra, 60 Cal.App.3d 814, 825.) The opinion

noted that the public schools are “already beset by social and financial problems”

including widespread dissatisfaction with their academic performance, and are

subject to “the limitations imposed upon them by their publicly supported

budgets.” (Ibid.) Subjecting such institutions to an academic duty of care under

these circumstances, the opinion concluded, “would expose them to the tort

claims—real or imagined—of disaffected students and parents in countless

numbers. . . . The ultimate consequences, in terms of public time and money,

would burden them—and society—beyond calculation.” (Ibid.)

As the instant Court of Appeal made clear, however, the considerations

identified in Peter W. that preclude an action for personal educational injury based

on inherently subjective standards of duty and causation do not apply to a claim

that school operators fraudulently sought and obtained public education funds for

doing nothing more than collecting attendance forms. Resolution of such a claim

does not require judgments about pedagogical methods or the quality of the

school’s classes, instructors, curriculum, textbooks, or learning aids. Nor does it

49

require evaluation of individual students’ educational progress or achievement, or

the reasons for their success or failure. It simply obliges the court to determine

whether the operator offered any significant teaching, testing, curriculum

oversight, and educational resources to ostensible students.

Similarly, nothing in the rationale of Peter W. precludes a claim that a

school operator’s claim on state funds was “false” insofar as the school committed

objectively identifiable breaches of its charter, applicable state law, or promises it

made to induce enrollment. For example, Peter W. does not bar assertions that a

school operator failed to provide promised equipment and supplies, used teachers

who lacked necessary credentials, violated specific rules governing “independent

study” programs, or caused students, parents, or guardians to incur improper fees

or charges,35 so long as such claims do not challenge the educational quality or

results of the school’s programs.36


35

Indeed, we have routinely addressed claims that public schools wrongly

charged students, parents, or guardians for school-related activities or services,
without any suggestion that such issues implicated the “educational malfeasance”
doctrine. (E.g., Salazar v. Eastin (1995) 9 Cal.4th 836 [taxpayer suit challenging
charges for transportation of students to and from school]; Hartzell v. Connell
(1985) 35 Cal.3d 899 [parent/taxpayer suit challenging school fees for
extracurricular activities].)

36

We emphasize that our discussion here is limited to whether such theories

are barred under Peter W. as claims for “educational malfeasance.” We express
no view on whether such allegations can form the basis for a cause of action under
the CFCA
. In other words, we do not address whether a charter school’s breaches
of promises to students, parents, or guardians, or its violations of its charter or
applicable law, may cause any related funding claims the school makes upon the
state to be “false” within the meaning of that statute. Nor, of course, do we
concern ourselves with the possibility that plaintiffs have pled factually
inconsistent CFCA theories by alleging, on the one hand, that the charter school
defendants failed to deliver educational equipment and supplies and, on the other,
that they violated the “independent study” rules by providing things of value not
offered to classroom students. Such issues were not addressed on demurrer and
are beyond the scope of this appeal.

50

For the most part, plaintiffs’ CFCA allegations, detailed above, conform to

these principles, and thus avoid preclusion under Peter W. As the Court of Appeal

held, the trial court thus erred in concluding that the CFCA cause of action was

wholly barred as a claim for “educational malfeasance.” We note, however, a

single passage of the complaint which alleges that One2One “fails to provide the

education it promises but falsely collects State educational funds as if the

education were provided.” Insofar as this particular allegation seeks to raise issues

of the quality of education offered by the charter school defendants, or of the

academic results produced, we believe it falls within the rule that courts will not

entertain claims of “educational malfeasance.” To that extent, therefore, the

allegation is not actionable.


9. Did the CFCA cause of action against the charter school operators

require prior presentment of a claim under the TCA?

The TCA states that, with specified exceptions, all “claims for money or

damages” against the state or “local public entities” must be “presented” in

accordance with that law. (Gov. Code, §§ 905, 905.2.) Except as otherwise

provided, no suit for money or damages may be brought against a public entity

until such a claim has been presented to the entity and acted upon or deemed

rejected. (Id., § 945.4.) The claim must be presented within six months of accrual

of the cause of action (id., § 911.4), but the claimant may apply to the public entity

for leave to present a late claim (id., § 911.6). If such an application is denied, or

deemed denied, the claimant may petition the court for relief from the claim

presentment requirement. (Id., § 946.6.)

Plaintiffs’ complaint pleads that they “have presented claims for money or

damages to the public entity defendants pursuant to the requirements of

Government Code [section] 945.4, which have been denied, and/or have sought

relief from the claims presentment requirements.” (Italics added.) Plaintiffs

51

concede that this pleading does not allege actual compliance with the TCA claim

presentment requirements, and that they have not so complied. They urge no such

compliance is necessary for purposes of the CFCA. The Court of Appeal

concurred. We agree with the Court of Appeal.

At the outset, we need not decide whether the TCA’s claim presentment

requirements apply to plaintiffs’ CFCA claims against the district defendants,

because we have concluded that those defendants are not “persons” subject to suit

under the CFCA. (See discussion, ante.) On the other hand, the question arises

whether the claim presentment provisions of the TCA could ever apply to the

charter school defendants.

Under that law, claims must be presented to “the state” (Gov. Code,

§ 905.2) or “local public entities” (id., § 905). For purposes of the TCA, “ ‘[l]ocal

public entity’ includes a county, city, district, public authority, public agency, and

any other political subdivision or public corporation in the [s]tate, but does not

include the [s]tate.” (Gov. Code, § 900.4.) Under the CSA, charter schools are

part of the public school system and, for specified purposes, are deemed to be

school districts. (See discussion, ante.) However, those purposes do not expressly

include coverage by the TCA, and the nongovernmental operators of charter

schools do not fit comfortably within any of the categories defined, for purposes of

the TCA, as “local public entities.”

In any event, as the Court of Appeal concluded, application of the TCA’s

claim presentment requirement to CFCA actions would frustrate the purposes of

both statutes. The TCA itself expressly excludes from the claim presentment

requirement “[c]laims by the [s]tate or by a state department or agency or by

another local public entity.” (Gov. Code, § 905, subd. (i).) Hence, CFCA actions

brought, in their official capacities, by the Attorney General (id., § 12652,

subd. (a)) or local prosecuting authorities (id., subd. (b)) clearly are exempt.

52

The same rule appears applicable to qui tam actions by “persons” under the

CFCA. Such a suit is brought, not only for the qui tam plaintiff, but “for the State

of California in the name of the state, if any state funds are involved, or for a

political subdivision in the name of the political subdivision, if political

subdivision funds are exclusively involved.” (Gov. Code, § 12652, subd (c)(1),

italics added.) If the Attorney General or local prosecuting authority elects not to

intervene and proceed with the action, “the qui tam plaintiff shall have the same

right to conduct the action as the Attorney General or prosecuting authority would

have had if it had chosen to proceed . . . .” (Id., subd. (f)(1).) Hence, at the time a

qui tam action is brought, the qui tam plaintiff stands in the shoes of the state or

political subdivision, and within the TCA exemption for claims by the state or a

local public entity.

Moreover, as the Court of Appeal explained, the qui tam provisions of the

CFCA are at odds with the policy behind the TCA’s claim presentment

requirement. The general proviso that a public entity may not be sued for money

or damages until it has received, and had the chance to act upon, a written claim is

intended to allow the entity to investigate while the facts are fresh, to settle short

of litigation where appropriate, and to engage in fiscal planning for potential

liability. (E.g., City of San Jose v. Superior Court (1974) 12 Cal.3d 447, 455;

Gatto v. County of Sonoma (2002) 98 Cal.App.4th 744, 763; Barkley v. City of

Blue Lake (1996) 47 Cal.App.4th 309, 316.)

On the other hand, a qui tam complaint under the CFCA must be filed

under seal, and immediately must be served, along with a written disclosure of all

material evidence and information the qui tam plaintiff possesses, on the Attorney

General. (Gov. Code, § 12652, subd. (c)(2), (3).) If political subdivision funds

are involved, the Attorney General must forward these materials to the local

prosecuting authority within 15 days. (Id., subd. (c)(7)(A).) The complaint must

53

remain sealed for up to 60 days after filing, with additional extensions available

upon timely application, while the Attorney General or local prosecuting authority

investigates and decides whether to intervene. (Id., subd. (c)(2), (4), (6), (7).)

During this period, the complaint must not be served on the defendant. (Ibid.)

Moreover, once a qui tam action is filed, it cannot be settled without the consent of

the court, “taking into account the best interests of the parties involved and the

public purposes behind [the CFCA].” (Id., subd. (c)(1).)

No California decision has discussed the purpose of the CFCA’s seal

requirement. However, several federal cases, addressing the FFCA’s similar

provision, have indicated that the interests served include making sure the qui tam

action does not alert wrongdoers, prior to intervention by the government, that

they are under investigation. (E.g., U.S. ex rel. Lujan v. Hughes Aircraft Co.

(9th Cir. 1995) 67 F.3d 242, 245-246; United States ex rel. Pilon v. Martin

Marietta Corp. (2d Cir. 1995) 60 F.3d 995, 1000; Erickson ex rel. United States v.

American Institute of Bio. Sciences (E.D.Va. 1989) 716 F.Supp. 908, 912.)

The CFCA does not explicitly preclude a potential qui tam plaintiff, prior

to filing a CFCA complaint, from disclosing to the potential defendant the basis of

the claim, or even from attempting to settle it. But the CFCA’s purposes would

obviously be undermined if CFCA qui tam plaintiffs were required, under the

TCA, to present “local public entity” defendants, as defined in that statute, with

written claims before proceeding with suit.

The charter school defendants urge that this construction of the two statutes

improperly “elevates” the CFCA over the TCA. Not so. As we have noted, the

TCA includes an explicit exemption from the claim presentment requirement for

claims by the state and local public entities. Qui tam actions under the CFCA are,

in essence, claims of that kind. In any event, in view of the secrecy provisions of

54

the CFCA, a later and more narrowly focused statute, it must prevail over contrary

provisions of the earlier and more general TCA.37

We therefore conclude that even if the charter school defendants are “local

public entities” for purposes of the TCA, plaintiffs were not required under that

statute to present written claims before filing their qui tam complaint pursuant to

the CFCA.38


37

Defendant Sierra Summit Academy urges that the claim presentment

requirement of the TCA is made applicable to the CFCA by Government Code
section 12651, subdivision (e), which provides, in effect, that the CFCA is not
violated by claims made pursuant to the TCA. We fail to follow the logic of this
argument. That claims made pursuant to the TCA do not violate the CFCA does
not mean a CFCA action against a public entity must be preceded by presentment
of such a claim. Insofar as this defendant seeks to argue that section 12651,
subdivision (e) exempts it from the CFCA, the claim lacks merit on this record.
There is no indication that Sierra Summit Academy’s claims for state education
funding—the basis of plaintiffs’ CFCA cause of action—were presented pursuant
to the TCA.

38

The charter school defendants suggest alternatively that, as “public entities”

for purposes of the TCA, they enjoy, pursuant to that statute, immunity from
CFCA liability. These defendants note the TCA’s rule that a public entity is not
liable for an “injury” where the public employee causing the injury is immune
from liability. (Gov. Code, § 815.2, subd. (b).) They claim that submission of a
false claim is a “discretionary act” and a “misrepresentation” for which a public
employee, and thus the public entity, would be immune. (See id., §§ 820.2, 822.2;
see also § 818.8.) However, while the TCA was meant to supplant contrary
common law, it was not intended to prevail over other statutes that impose liability
in specific circumstances. (See Nestle, supra, 6 Cal.3d 920, 932; Cal. Law
Revision Com. com., 32 West’s Ann. Gov. Code (1995 ed.) foll. § 815, pp. 167-
168.) As we have seen, the CFCA makes “persons,” including “natural person[s],
corporation[s], [and] organization[s]” (Gov. Code, § 12650, subd.(b)(5)), liable for
the submission of false claims (id., §§ 12651, 12652). Insofar as “persons,” as
defined in the CFCA, include the nongovernmental corporations and entities that
operate charter schools, they are not entitled to immunity under the TCA. The
charter school defendants note that immunities specified in the TCA prevail over
liabilities set forth in that statute. (Cal. Law Revision Com., com., 32 West’s Ann.
Gov. Code, supra, foll. § 185, p. 168.) But this principle applies only within the
TCA itself
(ibid.); it does not preclude the Legislature from adopting other statutes

55

CONCLUSION

The judgment of the Court of Appeal is reversed insofar as it concludes that

(1) the public school defendants are “persons” subject to suit under the CFCA, (2)

the charter school defendants are not “persons” subject to suit under the UCL, and

(3) the “independent study” restrictions set forth in Education Code section

51747.3, in the form adopted in 1993, did not apply to charter schools until that

section was amended in 1999. In all other respects, the judgment of the Court of

Appeal is affirmed. LeVine v. Weis, supra, 68 Cal.App.4th 758, and LeVine v.

Weis, supra, 90 Cal.App.4th 201, are disapproved to the extent they hold that

public school districts are “persons” who may be sued under the CFCA. The

cause is remanded to the Court of Appeal for further proceedings consistent with

the views expressed in this opinion.















BAXTER, J.

WE CONCUR:

GEORGE, C.J.
CHIN, J.
MORENO,
CORRIGAN, J.
IRION, J. *








* Associate Justice of the Court of Appeal, Fourth Appellate District, Division
One, assigned by the Chief Justice pursuant to article VI, section 6 of the
California Constitution.


that impose liability in specific circumstances, despite immunities stated in the
TCA.

56






















CONCURRING AND DISSENTING OPINION BY KENNARD, J.



I concur in the majority’s holdings that: (1) public school districts are not

subject to lawsuits under the California False Claims Act; (2) charter schools and

their operators are subject to lawsuits under the California False Claims Act and

the unfair competition law; (3) plaintiffs’ claims, except for the allegation that

defendant One2One Learning Foundation failed to provide the education it

promised, are not barred as claims for “educational malfeasance”; and

(4) plaintiffs are not required to present written claims under the Tort Claims Act

before filing a qui tam action under the California False Claims Act.

I dissent, however, from the majority’s holding that Education Code section

51747.31 applied to charter schools before its amendment in 1999, which became

effective on January 1, 2000. That holding violates the rule that courts are to

harmonize and maintain the integrity of statutes whenever possible, and it is

contradicted by the legislative history of the 1999 amendment to section 51747.3.

Section 51747.3 was originally enacted in 1993. As here pertinent it

(1) prohibited a local education agency from claiming state funding for students in

independent study programs if the agency provided funds or other things of value

beyond what it provided to students who attend regular classes; (2) prohibited

school districts and county superintendents of schools, notwithstanding any other

provision of law applicable to them, from claiming average daily attendance (for

purposes of apportionment of funds) for students who were not residents of their


1

All further statutory references are to the Education Code unless otherwise

indicated.

1

county or a county immediately adjacent to their county; and (3) provided that its

provisions could not be waived by the State Board of Education, by the State

Superintendent of Public Instruction, or “under any provision of Part 26.8

(commencing with Section 47600).” (Stats. 1993, ch. 66, § 32, p. 923, italics

added.) Section 47600 is the first statute appearing in the Charter School Act. In

1999, the Legislature amended section 51747.3 to apply its provisions to charter

schools. (Stats. 1999, ch. 162, § 1.)

Seizing on the language in the 1993 enactment of section 51747.3

prohibiting waiver of that statute’s provisions under the Charter School Act, the

majority reasons that the waiver reference serves no purpose if section 51747.3 did

not apply to charter schools. Perhaps so. But the majority’s construction cannot

be reconciled with the plain language of other statutory provisions, as I explain.

Section 51747.3, when enacted in 1993, provided that school districts and

county superintendents of schools could not claim students from outside the

county or adjacent counties in average daily attendance. Charter schools,

however, were prohibited by subdivision (d) of former section 47605 (as added by

Stats. 1992, ch. 781, § 1, p. 3758) from excluding students on the basis of their

residence even if they lived beyond those boundaries. And at that time the Charter

School Act then also provided, in former section 47610 (as added by Stats. 1992,

ch. 781, § 1, p. 3760), that a charter school was exempt from all laws governing

school districts except as specified in section 47611. Because section 51747.3, a

law that governs school districts, was not then specified in section 47611, it had no

applicability to charter schools. Thus, the majority’s construction of section

51747.3, as originally enacted in 1993, as applying to charter schools is flatly

inconsistent with the language of former sections 47605, subdivision (d), 47610,

and 47611. In my view, the relevant statutory provisions are best harmonized and

given effect by construing section 51747.3, as originally enacted in 1993, as being

inapplicable to charter schools. Such applicability occurred only on January 1,

2

2000, the date on which the Legislature’s 1999 amendment of section 51747.3

became effective.

The legislative history of section 51747.3 further underscores the error of

the majority in construing the language of that statute’s 1993 amendment as

applying to charter schools. The Legislative Counsel’s Digest of Senate Bill No.

434 (1999-2000 Reg. Sess.), which in 1999 proposed amending section 51747.3,

specifically noted that the bill was adding charter schools to the statute:

“(2) Existing law prohibits a local education agency from claiming state funding

for the independent study of a pupil, whether characterized as home study or

otherwise, if the agency has provided any funds or other thing of value to the pupil

or his or her parent or guardian that the agency does not provide to pupils who

attend regular classes or to their parents or guardians. [¶] This bill would make

this prohibition applicable to charter schools . . . . [¶] (3) Existing law requires

community school and independent study average daily attendance to be claimed

by school districts and county superintendents of schools only for pupils who are

residents of the county in which the apportionment claim is reported or pupils who

are residents of the county in which the apportionment claim is reported or pupils

who are residents of the county immediately adjacent to the county in which the

apportionment claim is reported. [¶] This bill would apply this provision also to

charter schools.” (Leg. Counsel’s Dig., Sen. Bill No. 434 (1999-2000 Reg. Sess.),

italics added; accord, Sen. Com. on Education, Analysis of Senate Bill No. 434

(1999-2000 Reg. Sess.) June 28, 1999 [“Distance learning most closely resembles

independent study in other public schools, but charter schools are not specifically

required to abide by the independent study requirements that apply to other public

schools”].) Thus, as the Court of Appeal here concluded, the legislative history

indicates that it was only in 1999 that the Legislature intended to add charter

schools to section 51747.3.

Accordingly, I would affirm the judgment of the Court of Appeal, which in

turn affirmed the trial court, insofar as it concluded that section 51747.3, as

3

originally enacted in 1999, did not apply to charter schools, and that it was only

when the statute’s 1999 amendment became effective on January 1, 2000, that

charter schools came within the statute’s reach.

KENNARD, J.






4

See last page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion Wells v. One2One Learning Foundation
__________________________________________________________________________________

Unpublished Opinion

Original Appeal
Original Proceeding
Review Granted
XXX 116 Cal.App.4h 515
Rehearing Granted

__________________________________________________________________________________

Opinion No.
S123951
Date Filed: August 31, 2006
__________________________________________________________________________________

Court:
Superior
County: Sierra
Judge: William Wooldridge Pangman

__________________________________________________________________________________

Attorneys for Appellant:

Law Offices of Michael S. Sorgen, Michael S. Sorgen, Andrea Adam Brott, Joshua N. Sondheimer, Robert
S. Rivkin, Claudia A. Baldwin; Haley and Bilheimer, Allan Haley and John Bilheimer for Plaintiffs and
Appellants.

James Moorman, Amy Wilken, Joseph E. B. White; Law Offices of Paul D. Scott and Paul D. Scott for
Taxpayers Against Fraud as Amicus Curiae on behalf of Plaintiffs and Appellants.

__________________________________________________________________________________

Attorneys for Respondent:

Gordon & Rees, Dion N. Cominos, Fletcher C. Alford, Heather A. McKee and Mark C. Russell for
Defendant and Respondent One2One Learning Foundation.

Seyfarth Shaw, James M. Nelson, Kurt A. Kappes, Jason T. Cooksey and William S. Jue for Defendant and
Respondent Charter School Resource Alliance.

California Education Legal Services, Thomas M. Griffin; Girard & Vinson, Christian M. Keiner and David
E. Robinett for Defendant and Respondent Camptonville Union Elementary School District.

Parks, Dingwall & Associates, Linda Rhoads Parks; Law Offices of Jon Webster and Jon Webster for
Defendants and Respondents Camptonville Academy, Inc., and Janice Jablecki.

Needham, Davis, Kirwan & Young, Marc E. Davis, Marc J. Cardinal and Matt Demel for Defendant and
Respondent Mattole Unified School District.

Duncan, Ball & Evans, Evans, Wieckowski & Ward, Matthew D. Evans and James B. Carr for Defendants
and Respondents Sierra Summit Academy, Inc., and Sierra Plumas Joint Unified School District.








Page 2 – S123951 – counsel continued


Attorneys for Respondent:

Farmer, Murphy, Smith & Alliston, Craig E. Farmer and Jojra E. Jackson for Statewide Association of
Community Colleges, Southern California Regional Liability Excess Fund, Northern California Regional
Liability Excess Fund and Schools Excess Liability Fund as Amici Curiae on behalf of Defendants and
Respondents.

Sharon L. Browne for Pacific Legal Foundation as Amicus Curiae on behalf of Defendants and
Respondents.

Declues & Burkett, J. Michael Declues and Gregory A. Wille for Coast Community College District as
Amicus Curiae on behalf of Defendants and Respondents.

Gibson, Dunn & Crutcher, Joel S. Sanders, Mark A. Perry, Ethan D. Dettmer and Rebecca Justice Lazarus
for PricewaterhouseCoopers LLP as Amicus Curiae on behalf of Defendants and Respondents.

Ann Miller Ravel, County Counsel (Santa Clara) and Kathryn J. Zoglin, Deputy County Counsel, for
California State Association of Counties as Amicus Curiae on behalf of Defendants and Respondents.

Thomas Law Firm, R. Todd Bergin and Allen L. Thomas for Fullerton Joint Union High School District,
Brea-Olinda Unified School District, Claremont Unified School District, Huntington Beach Union High
School District, Long Beach Unified School District, Newport-Mesa Unified School District, Placentia-
Yorba Linda Unified School District, Pomona Unified School District Santa Monica-Malibu Unified
School District, Tustin Unified School District and Whittier Union School High School District as Amici
Curiae on behalf of Defendants and Respondents.

Bill Lockyer, Attorney General, Manuel M. Medeiros, State Solicitor General, James Humes, Chief
Assistant Attorney General, Christopher Ames, Assistant Attorney General, Larry G. Raskin and Mark R.
Soble, Deputy Attorneys General, for Real Party in Interest and Respondent.



















Counsel who argued in Supreme Court (not intended for publication with opinion):

Michael S. Sorgen
Law Offices of Michael S. Sorgen
240 Stockton Street, 9th Floor
San Francisco, CA 94108
(415) 956-1360

Kurt A. Kappes
Seyfarth Shaw
400 Capitol Mall, Suite 2350
Sacramento, CA 95814
(916) 448-0159

James B. Carr
Evans, Wieckowski & Ward
745 University Avenue
Sacramento, Ca 95825
(916) 923-1600

Mark R. Soble
Deputy Attorney General
1300 “I” Street
Sacramento, CA 94244-2550
(916) 322-5247



Opinion Information
Date:Docket Number:
Thu, 08/31/2006S123951

Parties
1Charter School Resource Alliance (Defendant and Respondent)
Represented by Jason Tremayne Cooksey
Seyfarth Shaw et al.
400 Capitol Mall, Suite 2350
Sacramento, CA

2Charter School Resource Alliance (Defendant and Respondent)
Represented by Kurt A. Kappes
Seyfarth Shaw et al.
400 Capitol Mall, Suite 2350
Sacramento, CA

3One2one Learning Foundation (Defendant and Respondent)
Represented by Mark Cameron Russell
Gordon & Rees
275 Battery Street, Suite 2000
San Francisco, CA

4One2one Learning Foundation (Defendant and Respondent)
Represented by Dion Nicholas Cominos
Gordon & Rees
275 Battery Street, Suite 2000
San Francisco, CA

5Camptonville Elementary School District (Defendant and Respondent)
Represented by Christian Mark Keiner
Kornick Moskovitz Tiedmann & Girard
400 Capitol Mall, 27th floor
Sacramento, CA

6Camptonville Academy Inc. (Defendant and Respondent)
Represented by Jon Paul Webster
Law Offices of Jon Webster
1985 Bonifacio Street, Suite 102
Concord, CA

7Camptonville Academy Inc. (Defendant and Respondent)
Represented by Linda Rhoads Parks
Parks Dingwall & Associates
P.O. Box 3207
Long Beach, CA

8Mattole Unified School District (Defendant and Respondent)
Represented by Mark E. Davis
Needham Davis Kepner & Young, LLP
1960 The Alameda, Suite 210
San Jose, CA

9Mattole Unified School District (Defendant and Respondent)
Represented by Marc Joseph Cardinal
Needham Davis Kepner & Young, LLP
1960 The Alameda, Suite 210
San Jose, CA

10Wells, Joey (Plaintiff and Appellant)
Represented by Michael S. Sorgen
Attorney at Law
240 Stockton Street, 9th Floor
San Francisco, CA

11State Of California (Real Party in Interest and Respondent)
Represented by Mark Richard Soble
Office of the Attorney General/Civil Division
1300 "I" Street, 9th Floor
P.O. Box 944255
Sacramento, CA

12Sierra Plumas Joint Unified School District (Defendant and Respondent)
Represented by James Byron Carr
Evans, Wiekowski and Ward, LLP
745 University Avenue
Sacramento, CA

13Sierra Plumas Joint Unified School District (Defendant and Respondent)
Represented by Mathew D. Evans
Evans, Wiekowski and Ward, LLP
745 University Avenue
Sacramento, CA

14Statewide Association Of Community Colleges (Amicus curiae)
Represented by Craig E. Farmer
Farmer Murphy Smith et al.
3640 American River Drive, Suite 150
Sacramento, CA

15Statewide Association Of Community Colleges (Amicus curiae)
Represented by Jorja Jackson
Farmer Murphy Smith et al.
3640 American River Drive, Suite 150
Sacramento, CA

16Fullerton Joint Union High School (Amicus curiae)
Represented by Allen Lee Thomas
Thomas Law Firm
5000 E. Spring Street, Suite 430
Long Beach, CA

17California State Association Of Counties (Amicus curiae)
Represented by Kathryn Jennifer Zoglin
Santa Clara County Counsel
70 W. Hedding Street, East Wing
San Jose, CA

18Pacific Legal Foundation (Amicus curiae)
Represented by Sharon L. Browne
Pacific Legal Foundation
3900 Lennane Drive, Suite 200
Sacramento, CA

19Coast Community College District (Amicus curiae)
Represented by J. Michael Declues
Declues & Burkett, LLP
17011 Beach Boulevard, Suite 400
Huntington Beach, CA

20Pricewaterhousecooper Llp (Amicus curiae)
Represented by Ethan Douglas Dettmer
Gibson Dunn & Crutcher, LLP
1 Montgomery Street
San Francisco, CA

21Taxpayers Against Fraud (Amicus curiae)
Represented by Paul Douglas Scott
Attorney at Law
201 Filbert Street, Suite 401
San Francisco, CA


Disposition
Aug 31 2006Opinion filed

Dockets
Apr 8 2004Petition for review filed
  In Sacramento by counsel for Respondent {Charter School Resource Alliance}.
Apr 8 2004Request for judicial notice received (pre-grant)
  Respondent {Charter School Resource Alliance}.
Apr 9 2004Received Court of Appeal record
  One doghouse.
Apr 12 20044th petition for review filed
  counsel for resps. (One2One Learning Foundation now known as Axis 4 Learning)
Apr 12 2004Joinder to petition filed
  by counsel for (Camptonville Elementary School District)
Apr 12 20045th petition for review filed
  by counsel for resp. (Sierra Plumas Joint Unified Sch. District and Sierra Summit Academy)
Apr 12 20042nd petition for review filed
  by counsel for resps. (The Camptonville Academy, Inc. and Janice Jablecki)
Apr 12 20043rd petition for review filed
  by counsel for resp. (Mattole Unified Sch. Dist.)
Apr 12 2004Request for judicial notice received (pre-grant)
  from Mattole Unified Sch. Dist.)
Apr 30 2004Answer to petition for review filed
  by counsel for aplts. (Joey Wells, etc, et al.,)
May 10 2004Reply to answer to petition filed
  by counsel for resps. (One2 One Learning Found.)
May 10 2004Reply to answer to petition filed
  by counsel for (The Camptonville Academy, Inc. and Janis Jablecki)
May 10 2004Filed:
  by counsel for Charter School Resource Alliance, Joinder to Reply of resp. (One2One Learning Foundation)
Jun 2 2004Change of contact information filed for:
  counsel for Deft/Resp. (Camptonville Academy) Janis Jablecki)
Jun 8 2004Time extended to grant or deny review
  to and including July 9, 2004, or the date upon which review is either granted or denied.
Jun 23 2004Petition for review granted (civil case)
  Request for judicial notice granted. Votes: George, C.J., Baxter, Brown, and Moreno, JJ.
Jun 30 2004Request for extension of time filed
  counsel for resp. (Charter School Resource Alliance) requests extension of time to August 23, 2004. to file the opening brief on the merits. *** granted *** order being prepared.
Jul 2 2004Request for extension of time filed
  counsel for resp. (One 2 One Learning Found.) requests extension of time to August 23, 2004, to file the opening brief on the merits. *** granted *** order being prepared.
Jul 6 2004Certification of interested entities or persons filed
  by counsel aplt. (J. Wells)
Jul 7 2004Extension of time granted
  It is ordered that the time to serve and file ALL opening briefs in the case is extended to and including August 23, 2004.
Jul 8 2004Certification of interested entities or persons filed
  by counsel for resp. (Charter School Res.)
Jul 9 2004Received:
  from (Sierra Plumas Joint Unified Sch. District and Sierra Summit Academy) Request for Extension of time to August 23, 2004.
Jul 9 2004Received:
  from (Camptonville Academy,Inc, Janice Jablecki) Request for extension of time to August 23, 2004.
Jul 9 2004Received:
  from (Mattole Unified School District and Richard Graey) Request for Extenison of time to August 23, 2004.
Jul 9 20042nd record request
  remaining records.
Jul 12 2004Received Court of Appeal record
  1 doghouse
Jul 21 2004Certification of interested entities or persons filed
  respondent (One 2 One Learning)
Jul 21 2004Certification of interested entities or persons filed
  by respondent (Mattole Unified Sch.Dist.)
Aug 3 2004Certification of interested entities or persons filed
  counsel for resp. (Camptonville Elem.School Dist.)
Aug 3 2004Filed:
  by counsel for (Camptonville Elem. Sch. Dist.) Substitution of Atty. David Robinet and Christian Keiner for Thomas Griffin
Aug 5 2004Filed:
  by counsel for resp. (Sierra Plumas Joint Unified Sch. Dist., et al.) correction to fax and phone numbers.
Aug 13 2004Request for extension of time filed
  counsel for resp. (Charter School Resource Alliance) requests an extension of time to September 21, 2004 to file the opening brief on merits.
Aug 16 2004Request for extension of time filed
  counsel for resp. One 2 One Learning Found. (Axis 4 Learning) requests an extension of time to September 21, 2004. to file the opening brief on the merits.
Aug 18 2004Request for extension of time filed
  counsel for resp. (Sierra Plumas Joint Unified Sch. District and Sierra Summit Academy) requests extension of time to September 21, 2004, to file the opening brief.
Aug 18 2004Request for extension of time filed
  counsel for resp. (Camptonville Union Elementary School Dist.) requests an extension of time to September 21, 2004, to file the opening brief.
Aug 24 2004Order filed
  It is ordered that the time to serve and file ALL opening briefs in this case is extended to and including September 21, 2004. No further extensions of time are contemplated.
Sep 20 2004Opening brief on the merits filed
  by counsel for Camptonville Elementary Sch. Dist.
Sep 20 2004Opening brief on the merits filed
  by counsel for Charter School Resource Alliance
Sep 20 2004Opening brief on the merits filed
  by counsel for (Mattole Unified Sch. Dist.)
Sep 21 2004Opening brief on the merits filed
  by counsel for (The Camptonville Academy, Inc. and Janice Jablecki)
Sep 21 2004Opening brief on the merits filed
  by counsel for (One 2 One Learning Foundation now know as Axis 4 Learning)
Sep 21 2004Opening brief on the merits filed
  by counsel for Sierra Plumas Unified Sch. Dist. and Sierra Summit Academy (40k)
Sep 30 2004Request for extension of time filed
  counsel for (Wells) requests 60-day extension of time to Dec 20, 2004, to file the answer brief on the merits.
Oct 7 2004Request for extension of time filed
  counsel for RPI (State of Calif.) requests extension of time to December 20, 2004, to file the answer brief on the metits.
Oct 12 2004Extension of time granted
  Appellant's time to serve and file the answer brief on the merits is extended to and including December 20, 2004. No further extensions of time or contemplated.
Oct 18 2004Extension of time granted
  Real Party in Interest time to serve and file the answer brief on the merits is extended to and including December 20, 2004. No further extensions of time are contemplated.
Nov 15 2004Received:
  amended word count to amicus brief of Statewide Assn of Community Colleges, etal
Nov 18 2004Received application to file Amicus Curiae Brief
  Statewide Assoc. of Community Colleges, et al. in support of respondents/brief under same cover. (non-party)
Nov 30 2004Permission to file amicus curiae brief granted
  Statewide Association of Community Colleges (non-party)
Nov 30 2004Amicus curiae brief filed
  Statewide Association of Community Colleges, et al., Any party may file a single consolidated answer to all amicus curiae briefs within 20 days after the last date that an application to file an amicus curiae brief may be filed under rule 29.1(f) (2).
Dec 17 2004Answer brief on the merits filed
  by counsel for RPI (State of Calif.)
Dec 20 2004Received:
  from counsel for aplt. (J. Wells) answer brief on the merits.
Dec 20 2004Application to file over-length brief filed
  by counsel for aplt. (J. Wells)
Dec 20 2004Request for judicial notice filed (granted case)
  by counsel for aplt. (J. Wells)
Dec 21 2004Answer brief on the merits filed
  with permission by counsel for appellant (J. Wells) ***consolidated answer***
Dec 23 2004Request for extension of time filed
  counsel for resp. (Charter Sch. Res. Alliance) requests extension of time to February 7, 2005, to file the reply brief.
Dec 29 2004Request for extension of time filed
  counsel for resp. (One 2 One Learning Found.) requests extension of time to February 7, 2005, to file the reply brief on the merits.
Dec 30 2004Request for extension of time filed
  by resp Camptonville Sch. Dist. to file the reply brief, to 2-7-05.
Dec 30 2004Request for extension of time filed
  by resp Charter School Resource Alliance to file the reply brief, to 2-7-05.
Jan 3 2005Reply brief filed (case not yet fully briefed)
  Resps Sierra Plumas Joint Unified Sch. Dist and Sierra Summit Academy's reply brief to pltfs consolidated answer brief.
Jan 3 2005Request for extension of time filed
  by resp Camptonville Academy to file the reply brief, to 2-7-05.
Jan 4 2005Extension of time granted
  Respondent (Charter Sch. Resource Alliance) time to serve and file the reply brief is extended to and including February 7, 2005. No further extensions of time are comtemplated.
Jan 5 2005Reply brief filed (case not yet fully briefed)
  by counsel for Sierra Plumas Joint Unified Sch. Dist. and Sierra Summit Academy to (RPI) State of Calif.'s answer brief.
Jan 5 2005Extension of time granted
  Respondent Camptonville Union Elementary Sch. Dist, time to serve and file the reply brief is extended to and including February 7, 2005. No further extensions of time are contemplated.
Jan 5 2005Extension of time granted
  Respondent The Camptonville Academy, Inc, and Janice Jablecki , time to serve and filed the reply brief is extended to and including February 7, 2005. No further extensions of time are contemplated.
Jan 5 2005Extension of time granted
  Respondent One2One Learning Foundation, time to serve and file the reply brief is extended to and including February 7, 2005. No further extensions of time are contemplated.
Jan 10 2005Filed:
  by counsel letter notification: Claudia Antoinette Baldwin departure from the Law Offices of Michael Sorgen and no longer associate counsel for plaintiff.
Jan 11 2005Received application to file Amicus Curiae Brief
  w/ brief by Fullerton Joint Union High Sch. District (non-party) in support of respondent.
Jan 20 2005Permission to file amicus curiae brief granted
  Fullerton Joint Union High School District, et al.
Jan 20 2005Amicus curiae brief filed
  Fullerton Joint Union High School District, et al., (non-party) in support of respondent is hereby granted. Notwithstanding any prior order of this court, any party may file a single consolidated answer to all filed amicus curiae briefs within 20 days after the court has acted upon timely applications to filed such briefs.
Feb 4 2005Reply brief filed (case not yet fully briefed)
  by counsel for resp. (Camptonville Union Elementary Sch. Dist.) to State's brief and Plf's consolidated brief.
Feb 4 2005Reply brief filed (case not yet fully briefed)
  by Resp Charter School Resource Alliance to RPI's (State of Calif) answer brief.
Feb 4 2005Filed:
  Resp. Charter School Resource Alliance application for permission to file oversize reply brief (to the answer brief of appellants) the brief is submitted with the application
Feb 7 2005Reply brief filed (case not yet fully briefed)
  by counsel for resp. The Camptonville Academy and Janice Jablecki (consolidated reply)
Feb 7 2005Reply brief filed (case not yet fully briefed)
  by counsel for resp. One 2 One Learning Foundation
Feb 14 2005Reply brief filed (case fully briefed)
  by counsel for Charter School Resource Alliance (overlength brief w/permission)
Mar 3 2005Received application to file Amicus Curiae Brief
  California State Association of Counties w/brief (non-party) in support of respondent.
Mar 4 2005Received application to file Amicus Curiae Brief
  Pacific Legal Foundation w/ brief (non-party)
Mar 8 2005Received application to file Amicus Curiae Brief
  PricewaterhouseCoopers LLP (non-party)
Mar 8 2005Received application to file Amicus Curiae Brief
  Coast Community College District, etal [in support of respondents]
Mar 8 2005Received:
  Request for Judicial Notice from PricewaterhouseCoopers, LLP, (non-party)
Mar 9 2005Permission to file amicus curiae brief granted
  Pacific Legal Foundation (non-party)
Mar 9 2005Amicus curiae brief filed
  Pacific Legal Foundation in support of respondents. An answer thereto may be served and filed by any party within 20 days of the filing of the brief.
Mar 9 2005Permission to file amicus curiae brief granted
  California State Association of Counties (non-parth)
Mar 9 2005Amicus curiae brief filed
  California Association of Counties in support of defendants and respondents. An answer thereto may be served and filed by any party within 20 days of the filing of the brief.
Mar 10 2005Received application to file Amicus Curiae Brief
  Taxpayers Against Fraud in support of plfs. and aplts. (non-party)
Mar 11 2005Permission to file amicus curiae brief granted
  PricewaterhouseCoppers, LLP.
Mar 11 2005Amicus curiae brief filed
  PricewaterhouseCoopers. An answer thereto may be served and filed by any party within twenty days of the filing of the brief.
Mar 11 2005Request for judicial notice filed (granted case)
  by PricewaterhouseCoopers, LLP.
Mar 21 2005Permission to file amicus curiae brief granted
  Coast Community College District in support of respondents. answer due within twenty days.
Mar 21 2005Amicus curiae brief filed
  COAST COMMINITY COLLEGE DISTRICT in support of respondent.
Mar 21 2005Permission to file amicus curiae brief granted
  Taxpayers Against Fraud in support of appellants. Answer due within 20 days.
Mar 21 2005Amicus curiae brief filed
  TAXPAYERS AGAINST FRAUD in support of appellants. Answer due within 20 days.
Apr 7 2005Received:
  from Amicus Curiae Taxpayers Against Fraud request to file Errata to amicus curiae brief.
Apr 8 2005Filed:
  by amicus curiae Taxpayers Against Fraud, Errata to Amicus Auriae brief filed on 3-21-05.
Apr 11 2005Response to amicus curiae brief filed
  by counsel for Camptonville Academy, Inc. and Janice Jablecki to amicus curiae brief of Taxpayers Against Fraud.
Apr 11 2005Response to amicus curiae brief filed
  by counsel for (Sierra Plumas Unif. Sch. Dist. and Sierra Summit Academy) to a/c brief filed by Taxpayers Against Fraud.
May 2 2005Filed:
  by counsel for The Camptonville Academy, Inc. and Janis Jablecki, Notice of Unavailability. May 28, thru June 6 and July 22, 2005 thru August 1, 2005.
Jun 27 2005Filed:
  by counsel for Camptonville Union Elem. Sch. Dist. notification to delete association of D. Robinet as counsel.
Jul 25 2005Notice of substitution of counsel
  for Respondents {Sierra Plumas Joint Unified School District et al.,}.
Oct 25 2005Filed:
  by counsel for Fullerton High Sch. Dist. re: exclusion of Robert T. Bergin as co-counsel.
Mar 28 2006Change of contact information filed for:
  counsel for resps. Mattole Unified Sch. District and Richard Graey, name change of counsel's law firm to Needham, Davis, Kepner & Young, LLP effective 3-29-06
May 2 2006Case ordered on calendar
  June 8, 2006, at 9:00 a.m., in Los Angeles
May 11 2006Justice pro tempore assigned
  Justice Joan, Irion (4th Appellate Dist., Div. 1) (Werdegar, J., recused)
May 12 2006Application filed to:
  divide oral argument time. Counsel for separate respondents (Sierra-Plumas Joint Unified School District and Charter School Resource Alliance) request to divide time (20 minutes and 10 minutes, respectively).
May 12 2006Application filed to:
  divide oral argument time. Real party in interest State of California (deputy attorney general Mark Soble) and counsel for appellants Joey Wells et al. (Michael S. Sorgen) requesting to equally divide oral argument time.
May 17 2006Order filed
  The request of counsel for appellants and respondent State of California in the above-referenced cause to allow two counsel to argue on their behalf at oral argument is hereby granted. The request to allocate to respondent State of California 15 minutes, and appellants Wells et al. 15 minutes, of their 30-minute allotted time for oral argument is granted.
May 17 2006Order filed
  The request of counsel for respondents One2One Learning Foundation et al. in the above-referenced cause to allow two counsel to argue on behalf of respondents at oral argument is hereby granted. The request to allocate to Sierra-Plumas Joint Unified School District 20 minutes, & Charter School Resource Alliance 10 minutes, of respondents' 30-minute allotted time for oral argument is granted.
May 18 2006Change of contact information filed for:
  Counsels for Sierra Plumas Joint Unified School District and Sierra Summit Academy The new address and firm name is as follows: Evans, Wieckowski & Ward, LLP 745 University Avenue, Sacramento, CA 95825
Jun 8 2006Cause argued and submitted
 
Aug 31 2006Opinion filed
  Reversed and remanded to the Court of Appeal for further proceedings. OPINION BY: Baxter, J. ---- joined by: George, C.J., Chin, Moreno, Corrigan, JJ., Irion, JPT CONCURRING AND DISSENTING OPINION BY: Kennard, J.
Sep 15 2006Rehearing petition filed
  counsel for California Charter Schools and Assoc. Joint Powers Authority
Sep 21 2006Time extended to consider modification or rehearing
  to and including November 29, 2006.
Oct 25 2006Rehearing denied
  Request to grant rehearing on our motion denied. Werdegar, J., was recused and did not participate.
Oct 25 2006Opinion modified - no change in judgment
 
Oct 25 2006Remittitur issued (civil case)
 
Nov 2 2006Received:
  receipt for remttitur from CA/3
Nov 16 2006Note:
  Records returned to CA/3 (4 vols.)

Briefs
Sep 20 2004Opening brief on the merits filed
 
Sep 20 2004Opening brief on the merits filed
 
Sep 20 2004Opening brief on the merits filed
 
Sep 21 2004Opening brief on the merits filed
 
Sep 21 2004Opening brief on the merits filed
 
Sep 21 2004Opening brief on the merits filed
 
Nov 30 2004Amicus curiae brief filed
 
Dec 17 2004Answer brief on the merits filed
 
Dec 21 2004Answer brief on the merits filed
 
Jan 3 2005Reply brief filed (case not yet fully briefed)
 
Jan 5 2005Reply brief filed (case not yet fully briefed)
 
Jan 20 2005Amicus curiae brief filed
 
Feb 4 2005Reply brief filed (case not yet fully briefed)
 
Feb 4 2005Reply brief filed (case not yet fully briefed)
 
Feb 7 2005Reply brief filed (case not yet fully briefed)
 
Feb 7 2005Reply brief filed (case not yet fully briefed)
 
Feb 14 2005Reply brief filed (case fully briefed)
 
Mar 9 2005Amicus curiae brief filed
 
Mar 9 2005Amicus curiae brief filed
 
Mar 11 2005Amicus curiae brief filed
 
Mar 21 2005Amicus curiae brief filed
 
Mar 21 2005Amicus curiae brief filed
 
Apr 11 2005Response to amicus curiae brief filed
 
Apr 11 2005Response to amicus curiae brief filed
 
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