Hope Academy Broadway Campus v. White Hat Management, LLC

Ten Cleveland charter schools (plaintiffs) contracted with for-profit operator White Hat Management (defendant) to handle nearly all school operations in exchange for 95-96% of per-student public funding, with White Hat required to title certain publicly funded purchases in the schools' names but otherwise able to retain title to property it purchased using the fees. After the schools performed poorly (with some closed or placed on academic watch by federal regulators) and the schools discovered White Hat had used the fees to buy and renovate buildings owned by its own affiliates while refusing to account for the funds, the schools sued for an injunction, accounting, breach of contract, and breach of fiduciary duty, and moved for partial summary judgment on the parties' property rights; the trial court and appellate court ruled the schools had to buy back White Hat-titled property at cost, finding the fees lost their public character once paid to White Hat and that no fiduciary duty existed.