EDMC Board Responsible For Recruiting Misdeeds: Shareholder

Law360, New York (August 6, 2012, 3:54 PM EDT) -- An Education Management Corp. shareholder launched a derivative lawsuit Friday against the company's board members, contending failures in corporate governance enabled the company to violate federal regulations on recruitment and enrollment, resulting in the fraudulent receipt of federal funds.

Shareholder Stephen Bushansky claims in Pennsylvania federal court that the directors of the Pittsburgh-based for-profit post-secondary education provider — which is currently fighting an $11 billion suit under the False Claims Act — allowed the company to ignore the regulations while it sought to rapidly bolster enrollment...
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