Obvious verdict: Law school is in serious trouble

Students enter the law library building on the first day of classes at the Charleston School of Law Monday August 18, 2014. (Grace Beahm/File)

The Charleston School of Law’s Class of 2015 will graduate today, and their diplomas surely will be embossed with the institution’s lofty Latin motto: Pro bono populi, which means “for the good of the people.”

Pro bono populi is a proper guiding principle for future lawyers.

The idea is that graduates of the Charleston School of Law invest three years and approximately $180,000 in tuition and related expenses, learn some Latin legal terms, pass required courses while doing free work with local attorneys, and ultimately land good jobs.

But no matter how intelligent it sounds, actions speak louder than words (facta non verba).

Since the Charleston School of Law started 12 years ago, four of the five founders took in millions in profits and are vacating the premises.

Their credo should be pro bono possessors (for the good of the owners), which is far less refined. Today’s commencement will be the school’s eighth since its founding by three well-known judges and two attorneys, all of them South Carolinians.

Sadly, today’s graduating class could be one of the last. The Charleston School of Law is dying, and the vultures are circling.

Two of the founders — Judge Alex M. Sanders, a former president of the College of Charleston, and attorney Ralph C. McCullough — relinquished ownership in the law school for $6 million between them. It does not appear to be a coincidence that they retired about the time a management and sales contract was signed with InfiLaw, which is owned by the Chicago-based private equity firm Sterling Partners.

The three remaining Charleston law school owners are prominent Charleston attorney Edward J. Westbrook and former federal magistrates George C. Kosko and Robert S. Carr. Kosko and Carr serve as the only trustees left on the governing board.

InfiLaw operates three for-profit law schools in Florida, Arizona and North Carolina, and offers online courses during the summer. It profits primarily from tuitions, most paid up front with federal student loans.

Needless to say, the majority of Charleston law school students, faculty and alumni, as well as Charleston Mayor Joseph P. Riley Jr. and other elected officials, have been among those opposed to the sale. The S.C. Commission on Higher Education (CHE) had granted a license to the Charleston law school, and the American Bar Association fully accredited it.

But the pending InfiLaw sale sparked an angry public reaction. In other words, the excrementum coepit uolare (the you-know-what hit the fan).

A CHE committee last year recommended that a license not be granted to InfiLaw to operate the Charleston school.

To his credit, Westbrook, who financed the school at its start, has openly opposed any involvement with InfiLaw.

But Kosko and Carr are ready to sell. It’s interesting to note that $25 million in school revenues was divided among all the founders instead of re-investing the money to sustain what was originally considered a noble endeavor (noblis conatus).

Westbrook offered to give his share of ownership to the College of Charleston or some other not-for-profit organization to take over the law school, and urged the other two remaining board members to do the same. He said that prior to the InfiLaw transaction, he and the others had considered converting the law school to an eleemosynary entity.

But the change to non-profit status foundered as trustee interest in an InfiLaw deal increased.

“The law school was not broken in July 2013. The school had significant cash reserves, harmonious faculty, enthusiastic students and support of the community,” Westbrook said. “I opposed the InfiLaw borrowing as unwise. The directors were distributed more than enough money to retire the loan.”

Westbrook recently resigned from the board. Kosko and Carr this week said the school would not fund today’s traditional post-commencement reception (an estimated $21,000), and would not enroll any more students after the Class of 2016.

They released this news as the students were taking final exams.

Ouch.

In a recent guest column in The Post and Courier, the president of InfiLaw Management Solutions said the Charleston law school was already in trouble when Sanders and McCullough retired.

He confirmed that InfiLaw loaned the trustees the money to cover their interests, and he said InfiLaw managed the school while not demanding any compensation from the remaining trustees. InfiLaw’s patience has run out, he warned.

Meanwhile, there is talk that the nation’s for-profit law school bubble could burst in the same way the nation’s mortgage banking system failed in 2008.

An article in The Atlantic magazine last September, titled “The Law-School Scam,” describes InfiLaw’s operations as “a capitalist dream of privatized profits and socialized losses.”

A growing number of for-profit law schools enroll numerous diverse, under-qualified students who easily get federal loans that go directly for tuitions.

Many of the students don’t pay back the loans because they can’t get well-paying jobs as lawyers.

In this case, according to the magazine article, InfiLaw’s private-equity owners are like investment banks, and under-qualified law students are like over-leveraged homebuyers.

Compounding the law school conundrum, there is no collateral, such as a house, to back the loan — or no quid pro quo, in lawyer language. All of which makes one wonder if this worrisome riddle has spread to the nation’s entire system of higher education.

College of Charleston President Glenn McConnell warns that there is a strong possibility of such a disruption being widespread. Citing a recent Gates Foundation study, McConnell — a lawyer, statesman and graduate of the College of Charleston — notes that as many as half of small colleges and universities will be absorbed or go out of business in the next 15 years because of poor finances, low endowments and low enrollments.

“The presidents who are willing to take charge with a vision are the ones who have the best chance to steer these institutions through the rough seas ahead,” he said. “The College of Charleston will not be one of the 50 percent. We have a vision for a living future.”

It’s shameful that on the Class of 2015’s graduation day, the Charleston School of Law seems to have no leaders left with any such pro bono populi vision at all.

John M. Burbage is a journalist, editor and book publisher who lives in Charleston and owns a working farm in Hampton County.