Peter Greene, the best education blogger ever, writes regularly for Forbes magazine. Hopefully, some of the nation’s business executives are learning about the for-profit entrepreneurs who have entered into the education “industry,”where they are profiting without doing much for students.

Greene recently wrote about the latest setback for the giant of the cybercharter industry. It’s now called Stride, but for many years it was K12 Inc. Top executives are paid millions of dollars. Profit, not learning, is its highest priority. Despite terrible academic results, low graduation rates, complaints about inflated enrollments, there are always school districts happy to host the cybercharter industry because the district gets a cut of the profits.

Greene writes:

Stride, a giant in the cyber charter school industry, was accused by a New Mexico school district of violating rules and regulations. Now a lawsuit alleges that Stride responded by mounting a coordinated attack on the district and its superintendent. 

In 2020, Gallup-McKinley County Schools contracted with Stride (formerly known as K12 Inc) to operate its New Mexico Destinations Career Academy. But the district alleges that the for-profit organization repeatedly cut corners, violated staffing rules, and inflated enrollment numbers. In May 2025, the school board voted to end the contract. 

“Our students deserve better,” said School Board President Christopher Mortensen in a press release.“This action is not sudden; it is the result of months of effort to address persistent issues with the contractor. We are taking this step to protect our students, uphold academic standards, and meet our obligations under state and federal law.”

Within months, the district had filed a complaint against Stride, charging them with fraud, unfair trade practices, civil conspiracy, and seven other counts. That lawsuit outlines the issues between Stride and the district. 

According to the complaint, Stride had continuing issues with meeting requirements for student-teacher ratios, having been notified as early as September 2023 that it was out of compliance. Special education teachers were over their permitted caseloads, and IEP students were not receiving their due process. Further, Stride failed to employ certified teachers, complete background checks, or provide state-mandated occupational and professional trainings to their staff. 

The district also alleges that Stride “retained nonexistent students on its rolls” and took school district funds for educating these ghost students. Stride failed to provide timely required communication with the district. Stride’s graduation rate, says the district, was “horrific,” with a graduation rate of 27.67% in 2024.

The district also claims that through it all, Stride has “ignored compliance requirements” and failed to produce a remediation plan. 

According to the suit filed by the district, a management representative of Stride came forward in May as a whistleblower, declaring that the increases in student-teacher ratios was “intentional… in order to increase profit margins.” The whistleblower reported that he made multiple attempts to inform upper management that Stride was out of compliance with state law, and asked for authority to hire the roughly 80 teachers needed. The Vice President of Finance, says the whistleblower, refused to authorize those hires. Instead, in a later meeting, the whistleblower was allegedly told that his “projected profit margin was too low.” He was directed to cut staff for the next year to meet projected profit margin.”

According to the whistleblower, Stride’s plans to deal with their troubles were not focused on meeting their obligations to the district. 

Instead, the whistleblower says, at an April meeting Stride’s Senior Vice President of School Development “Peter Stewart said the company should attack first publicly and Stride Inc. should develop a strategy for that” and that Stride CEO “James Rhyu said [to the group] that the Superintendent [for the School District] was in over his skis on this issue.” 

Alleges the district’s suit, ”Stride’s management, including the individual Defendants, engaged in and agreed to a civil conspiracy to cover up its misconduct and illegal activities acting, by and through its employees, agents and attorneys, in planning and engaging in a systemic public attack on the School District and its Superintendent of Schools to distract from its illegal activities and its breach of the contract with the Board of Education.”

And counter-attack they did. On April 22, the district sent Stride a letter charging it had “materially breached” its contract. On April 28, the company filed an ethics complaint against GMCS Superintendent Michael Hyatt, alleging that he had tried to leverage Stride’s contract with the district in order to secure a “lucrative position” with Stride. Hyatt had applied for a management position with Stride in 2024; the company declined to hire him.

The list of complaints by the district against Stride is long, but the theme is simple enough. 

Defendant Stride purposely and willfully disregarded the contractual requirements and the statutory and regulatory requirements in order to defraud the School District to increase its profits…

Defendant Stride, while obligated to provide a certain quality of education to students, disregarded its legal obligations with the sole intent to profit on the education of students that it was supposed to educate, and that profit was obtained illegally through the intentional 27 violations of State law, incomplete and false reporting of student data, withholding technical support and operating and manipulating student counts to include students who had been dropped, withdrawn or were excessively absent.

Asked for comment on the suit, a Stride representative directed me to the company’s suit-related web site which argues that the company has been working on an improvement plan, that their student-to-staff ratios are better than those reported by the district, and that “explosive growth” of NMDCA makes it hard to stay caught up with staffing. A reply to the district’s Aprill 22 letter contests virtually every point that the district has made about Stride’s performance. 

Since being cut loose from GMCS, Stride has re-opened NMDCA as a cyber charter school partnered with Charna Valley Independent Schools and Santa Rosa Consolidated Schools; a fact sheet from Stride says 3,000 students are enrolled, including 2,300 returning families. Those families, they say, are largely satisfied with the school. They also point out that many students enter the school short of credits, and that the majority of students are closing that gap. The Stride representative also sent a fact sheet alleging that GMCS is facing other legal problems. 

But Stride is no stranger to legal issues. It was founded in 2000 as K12 Inc by Ron Packard, former banker and Mckinsey consultant, and quickly became the leading national company for cyber schooling. One of its first big investors was Michal Milken. That investment came a decade after he pled guilty to six felonies in the “biggest fraud case in the securities industry” ending his reign as the “junk bond king.” Besides Milliken, Stride investors have included brothers Lowell and Larry Ellison, and BlackRock, founded by Larry Fink, whose brother Steve sits on the Stride Board of Directors.

In 2011, the New York Times detailed how K12’s schools were failing miserably, but still making investors and officers a ton of money. Former teachers wrote tell-alls about their experiences. In 2012. Florida caught K12 using fake teachers. The NCAA put K12 schools on the list of cyber schools that were disqualified from sports eligibility. In 2014, Packard turned out to be one of the highest paid public workers in the country, “despite the fact that only 28% of K12 schools met state standards in 2011-2012.”

In 2013 K12 settled a class action lawsuit in Virginia for $6.75 million after stockholders accused the company of misleading them about “the company’s business practices and academic performance.” In 2014, Middlebury College faculty voted to end a partnership with K12 saying the company’s business practices “are at odds with the integrity, reputation and educational mission of the college.”

In 2016 K12 got in yet another round of trouble in California for lying about student enrollment, resulting in a $165 million settlement with then Attorney General Kamala Harris. K12 was repeatedly dropped in some states and cities for poor performance.

In 2020, they landed a big contract in Miami-Dade county (after a big lucrative contribution to an organization run by the superintendent); subsequently Wired magazine wrote a story about their “epic series of tech errors.” K12 successfully defended itself from a lawsuit in Virginia based on charges they had greatly overstated their technological capabilities by arguing that such claims were simply advertising “puffery.”

The district is seeking compensatory and punitive damages from Stride. Four Stride executives are named in the suit in addition to Stride Inc itself. The court will decide who’s blowing smoke here. In the meantime, school districts continue to learn about the price of teaming up with aggressively for-profit partners. 

https://open.substack.com/pub/steady/p/no-kings-no-tyranny?r=rls8&utm_medium=ios

To the thousands of you who comment on Steady each week, first, let me say thank you. In reading your thoughts, it is safe to say you are: a) not happy with the direction of our country, and b) really not happy with the current president.

We’ve heard reports that millions of you will express your discontent on Saturday at “No Kings” rallies across the country and the world. That is your right, guaranteed under the First Amendment to the Constitution, which reads:

“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

And we hope that if you choose to make your voice heard, you remain steady, hold your head high and proudly participate in one of our most cherished democratic institutions. That is what freedom is about. Anyone and everyone can speak truth to power.

But Donald Trump has a long history of hating criticism and punishing those who challenge him and his actions. So, in yet another act of fealty to their “king,” the Republican Party has coordinated an intentional perversion of reality to explain why so many people may protest against the president.

Dipping back into their playbook of characterizing something before it has even happened, Republicans have dubbed them the “hate America” rallies, claiming that anyone who attends must be “pro-Hamas” or “antifa” types. Speaker of the House Mike Johnson took it a convoluted step further.

“It’s being told to us that they [Democrats] won’t be able to re-open the government until after that rally, because they can’t face their rabid base,” he said on Fox “News.” Someone might want to tell Johnson that the shutdown ball is in his court. If he actually wants to negotiate an end to it, he would have to bring the House back in session.

Johnson’s nonsensical sentiment was mirrored by Treasury Secretary Scott Bessent. “You know, ‘No Kings’ means no paychecks,” he said.

“The unhinged comments are the message,” Michael Steele, an MSNBC host and former head of the Republican National Committee explained.

“This is what it looks like when you’ve fully lost control of the message and you’re panicking,” Leah Greenberg, co-founder of Indivisible, one of the groups organizing “No Kings,” posted on social media.

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These comments on shaming Americans who are only exercising their constitutional rights should make everyone’s blood boil. It is absolute nonsense.

The goal of the disinformation campaign, which was no doubt coordinated in the highest ranks of the Republican Party, is simple: suppress turnout by criminalizing dissent–and change the narrative from “ peaceful protests” to “terrorism.”

“What they’re trying to do is to suppress support for the opposition, to try to make you think that you are somehow connected with violence if you show up for a peaceful protest rally,” Connecticut Senator Chris Murphy told NBC News. “I think the turnout is going to be big, and I think that that’ll be a sign that their tactics aren’t working.”

The “No Kings” rallies in June mobilized roughly five million peaceful protesters who love America but despise Trump and what they believe he is doing to the country. If estimates are correct, Saturday’s protests will be even bigger.

America was built on the backs of people protesting injustice. Resistance to wrongdoing is foundational to this country’s ethos. The American Revolution was sparked by the Boston Tea Party, a protest of British taxation. The fights for women’s suffrage, civil rights, gay rights all started with protests and ended with political change.

Curtailing rights has become a hallmark of the second Trump administration. Just ask the reporters who cover the Pentagon.

On Wednesday, any journalist who works for a news organization that did not agree to sign Defense Secretary Pete Hegseth’s 21-page long press rules — replacing a one-pager — was shown the door. Every organization, except the far-right One America News Network, declined. Even Fox, Hegseth’s former employer, chose not to sign. Hundreds of years of institutional knowledge and reporting experience left the building.

The new rules put increased limitations on access and raise the possibility of punishment for something as simple as asking for information. Hegseth claims these “common sense” changes are necessary to protect national security.

However, the only breach of national security since he became defense secretary was perpetrated by Hegseth himself. In March, he posted possibly classified U.S. military attack plans to an unsecure group chat, to which the editor of The Atlantic had accidentally been added.

Hegseth’s paranoia about leaks and security breaches should be a red flag. If things were going well under his leadership, he would be trumpeting his accomplishments. Instead, he engages in the classic Trump ploy of misdirection. What is he trying to hide?

One story he is attempting to spin into a positive narrative is the Trump administration’s repeated attacks on boats off the Venezuelan coast. A fifth boat was hit on Tuesday, killing all six alleged drug traffickers on board. The Pentagon was asked what ordnance was used, the legal basis for the attack, and the identities of those killed. No answers were given for that strike or for any of the four previous ones.

Hegseth, the least qualified person to lead the Defense Department in U.S. history, is trying to shut down scrutiny and restrict what the American people know about what the DOD is doing with a trillion dollars in tax payer money. But it is about more than billion-dollar weapons systems. It is about the men and women who serve.

“U.S. military’s policy of opening the Pentagon to the press was never a favor to the journalists who cover the military, but rather an obligation to a country that asks its sons and daughters to volunteer for service. If the government was going to ask Americans to risk their lives for our freedoms, then those empowered to send them into harm’s way would be willing to answer questions, especially tough ones,” wrote Nancy Youssef, who has covered the Pentagon for The Atlantic for 18 years.

Since the Pentagon opened its doors in 1943, the U.S. military has been able to balance its promise to protect secrets with its responsibility to inform the public through the media. Even though more than eight decades of balancing these dueling interests has been dismantled, reporters promised to keep reporting.

“I turned in my Pentagon pass today after 30 years because like all major news organizations ABC will not sign the new restrictive Pentagon requirements… [T]o be clear. We will all continue to cover national security from outside the building,” ABC News’s Martha Raddatz posted on social media. Mary Walsh of CBS News, one of the best and most patriotic reporters I have ever known, promised the same thing.

Godspeed to Raddatz, Walsh, and their colleagues, and to the protesters on Saturday. In different ways, both groups will be heeding the words on the “No Kings” website: “The president thinks his rule is absolute. But in America, we don’t have kings and we won’t back down against chaos, corruption, and cruelty.”