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Role Models files $304.5 million suit

March 05, 2004|by TARA REILLY

tarar@herald-mail.com

A military-style school for high school dropouts that once operated at the former Fort Ritchie U.S. Army base has filed a more than $300 million lawsuit in federal court against the PenMar Development Corp., that agency's former executive director, the Army and the U.S. Department of Labor.

The suit, filed Jan. 28 in U.S. District Court in the District of Columbia by Role Models America Inc., the College Corps Management Services Inc. and the president and founder of those agencies, Robert Alexander, alleges that the defendants engaged in a "collaborative scheme of discrimination, sabotage, and conspiracy orchestrated to disrupt, discredit, defame, bankrupt and destroy" Role Models.

"As direct and proximate cause of defendants' outrageous conduct, Plaintiff Alexander suffered severe emotional distress, humiliation, embarrassment, loss of self-esteem, and was otherwise damaged," the suit states.

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Role Models, which created the College Corps program for dropout youths, is seeking $304.5 million in the suit - $164.5 million in compensatory damages and $140 million in punitive damages.

PenMar was created by the state in 1997 to redevelop Fort Ritchie, which the U.S. Army shut down in 1998. The Army still owns the land, but PenMar is awaiting the transfer of the base's approximately 630 acres from the Army.

Role Models subleased about 253,000 square feet from PenMar for $1.3 million a year from March 2000 until it was evicted by PenMar in July 2002.

PenMar claimed Role Models owed it about $400,000 in rent and utility costs.

The suit alleges that Role Models, which focused on minority students and was led by Alexander, who is African-American, didn't receive as favorable a lease agreement as the International Masonry Institute (IMI), a PenMar tenant that has white owners.

"Upon information and belief," IMI paid $422 rent per day compared to the $4,000 per day rent paid by Role Models for similar space, the suit contends.

Role Models alleges in the lawsuit that its terminated lease and eviction were unjustified, and that on July 12, 2002, PenMar evicted Role Models Academy from the Fort Ritchie site with less than 24 hours notice.

As a result, Role Models was not able to retrieve all of its property from the former base, and former PenMar Executive Director James LaFleur refused to make other arrangements with Role Models so those items could be picked up, according to the suit.

The suit also alleges that PenMar "has appropriated some of said property to its own use and/or illegally disposed of others, thereby causing (Role Models) to incur damages in excess of $1 million in infrastructure, equipment, furniture, supplies and information technology."

Role Models claims in the suit that the U.S. Department of Labor, which administered congressional grants to fund the Role Models program, breached the grant agreement by not providing, coordinating and supporting the proper training and assistance to the program.

The suit also alleges that two audits performed by the Department of Labor on Role Models' finances were flawed and intended to ensure that the program lose its federal funding.

An audit released in Sept. 2003 by the Department of Labor questioned $262,268 in costs Role Models charged to a federal grant.

The Army did not return phone calls Thursday. A Department of Labor employee said the department had no comment on the suit.

There was no phone listing available for Alexander, who has a Mitchellville, Md., address.

Alexander's lawyer, Donald Temple of Washington, D.C., did not return phone calls placed to his office on Wednesday and Thursday.

PenMar's lawyer, Timothy Chriss, also did not return phone calls.

LaFleur did not return a phone call Thursday night.

The makeup of the PenMar board has changed since the eviction.

Some members of the PenMar board of directors who were on the board when Role Models was evicted no longer are on the board.

Seven of the 15-member board resigned late last year, and some of the open positions have been filled by new members.

PenMar also hired a new executive director since the Role Models eviction.

The suit alleges that the actions of PenMar, LaFleur, the Army and the Department of Labor forced Role Models to file Chapter 11 bankruptcy in May 2002 and brought about the termination of the College Corps program.

The program has not been able to secure funding, the suit states.

"Defendants engaged in outrageous conduct when they engaged in a concerted effort to destroy Dr. Alexander's life-long dream to create a national nonprofit organization with the mission and mandate of acquiring and converting a surplus military base closure property into the nation's first national Role Models demonstration academy for drop-out youth, including homeless youth," the suit states.

Role Models sued PenMar for $20 million in 2001, alleging breach of contract, fraud, negligent misrepresentation, breach of covenant of good faith and fair dealing and violation of Maryland corporate requirements.

Alexander later filed a request that the suit be dropped, citing a lack of legal representation.

Role Models filed another lawsuit in June 2002 against PenMar for overpayment of rent and utilities for buildings and services not provided, including $450,493 for renovations it says PenMar failed to make.

PenMar and Role Models have had several other legal disputes since the academy began operating.

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