Magnolia Science Academy #6 and #7 was due to close in 2014, they were over $1.2 million in debt, with over $200K in money going to H1-b Visas for teachers that were not employed by Magnolia. Magnolia Science Academy hired an attorney and placed an emergency injunction on the schools. The schools were allowed to stay open while a lawsuit was opened with stipulations in place. Magnolia Science Academy has several glaring issues with their financial problems, their attorney negotiated restructure and in addition would drop the lawsuit against LAUSD. Magnolia Science Academy must close. http://www.magnoliascienceacademy.blogspot.com

1. News Release
Contact: Lydia Ramos July 25, 2014
(213) 241-6766 #14/15-014
Judge Stops the Closure of
Magnolia Science Academies 6 and 7
Orders Magnolia Charter School to Provide the District with
Increased Financial Reporting and Monitoring
On June 27, 2014, the District issued findings indicating that Magnolia Charter School Academy (MSA) 6
and 7’s conditional renewal were rescinded based on material fiscal and operational findings and fiscal
mismanagement based on a forensic review of the schools and Magnolia Educational and Research
Foundation (MERF). Magnolia sought a preliminary injunction to block the District from implementing the
nonrenewal of the two schools.
At the hearing, Judge Luis A. Lavin stressed that he took the fiscal issues seriously and to protect the
public interest and public funds, the Court granted the injunction and ordered tighter financial controls and
reporting pending the determination of the merits of Magnolia’s petition.
In granting the preliminary injunction, the Court stated that the findings for not meeting the conditions of the
renewal should have been adopted by the Board of Education but that “LAUSD had presented evidence
establishing financial mismanagement by the Charter Schools.”
The District views Judge Lavin’s protective orders as affirmation of the serious conditions the District faced
with Magnolia. “Our primary concern has always been the students who attend Magnolia,” Superintendent
John E. Deasy said. “While it is never an easy decision to disrupt a school community, Magnolia’s fiscal
mismanagement and serious fiscal issues gave the District no choice. Now that Judge Lavin has provided
these additional protective measures, the schools can remain intact while the administrative appeals
process reaches its inevitable conclusion.”
Throughout the hearing on the preliminary injunction, Judge Lavin repeatedly indicated that the preliminary
injunction is in no way a ruling on the merits of whether Magnolia should continue to operate. A trial setting
conference will be held on October 14, 2014, and a hearing on the merits will be set sometime in January
2015.
-more-
Los Angeles Unified School District
OFFICE OF COMMUNICATIONS & MEDIA RELATIONS
333 S. Beaudry Ave., 24th floor
Los Angeles, CA 90017
Phone: (213) 241-6766
FAX: (213) 241-8952
www.lausd.net

2. LAUSD-Magnolia Ruling #14/15-014 2-2-2-2-2
In the meantime, Magnolia must comply with the following conditions:
 Magnolia shall provide LAUSD with a copy of the Magnolia 2009,13-14 audit report by July 28,
2014;
 Every 30 days thereafter, Magnolia shall provide LAUSD with updates of Magnolia’s profit and loss
statements, balance sheets, cash flow and bank statements, check registers, and expense reports;
 Magnolia shall not engage in deficit spending after maintaining reserves of 5 percent;
 Magnolia shall not make any further expenditures to Accord, or for immigration-related expenses;
 Magnolia shall provide LAUSD with copies of its vendor agreements; and
 Magnolia shall, in timely fashion, cooperate with any inquiry by LAUSD concerning Magnolia’s
finances.
If Magnolia fails to comply with any of the conditions outlined above, the District can petition the court on
an ex parte motion to dissolve the preliminary injunction.
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