SCRANTON — Three companies behind the private, for-profit juvenile detention and treatment facilities at the heart of the scandal that sent two former Luzerne County judges to jail have reached a settlement with numerous juveniles and parents, promising to put $2.5 million into an account to be disbursed for legal fees and to the families and individuals who are part of the class-action suit.
The settlement, granted preliminary approval in federal court, involves PA Child Care, Western PA Child Care and Mid-Atlantic Youth Services Inc. PA Child Care and Western PA Child Care built and ran two private detention facilities, one in Pittston Township, at the heart of what became known as the “Kids for Cash” scandal.
Former judges Michael Conahan and Mark Ciavarella were convicted of accepting millions in exchange for making sure Luzerne County youths deemed juvenile ended up in the facilities.
Both men are serving lengthy prison terms. Ciavarella has vehemently rejected the kids-for-cash label, insisting there was no quid pro quo between money he received and his decision as juvenile court judge to send children to the facilities.
The facilities were built by Robert Mericle and co-owned by attorney Robert Powell, both of whom admitted at Ciavarella’s trial that they had paid millions to the two judges.
Mericle said his payments were intended as legal “finder’s fees” to Ciavarella for his help in landing the contract to build the centers for Powell and co-owner Gregory Zappala. Powell and Mericle struck plea bargains in the case.
The settlement with the three providers admits no wrongdoing on their part. It also does not impact the civil suit against Ciavarella, Conahan and Powell.
The preliminary settlement filed in federal court sets up disbursement of the $2.5 million first for legal costs and fees.
Money remaining after that will be given to two classes of claimants:
• All juveniles who appeared before Ciavarella between Jan. 1, 2003, and May 28, 2008, who were adjudicated or placed by Ciavarella;
• All parents and/or guardians of all juveniles who appeared before Ciavarella between January 1, 2003, and May 28, 2008, and who, in connection with their child’s appearance: made payments in their own names or had wages, Social Security or other entitlements in their own names garnished or withdrawn; paid costs, fees, interest and/or penalties in their own names; suffered any loss of companionship and/or familial integrity and who were not fully reimbursed as a result of claims made in connection with the Mericle Settlement.
After legal costs, 70 percent of the remaining settlement fund will be distributed on a pro rata basis to the first class of claimants, with claimants getting a share multiplied by a points system.
Settlement class members who never spent time in any facilities as a result of appearing before Ciavarella get one point, each class member who was in a facility other than the two PA Child Care centers gets 2 points, and each class member who was placed in one of the two PA Child Care Centers gets 5 points.
The rest of the fund is split evenly, 15 percent for the parent class and 15 percent as a “holdback fund.”
The parent fund is to be distributed based on the amount of payments the member can document were made as a result of appearances before and rulings made by Ciavarella, but those who already received full reimbursement through the Mericle Settlement are not eligible. The holdback fund is reserved until all payments are made to cover additional costs that may arise during the process.
The settlement includes a confidentiality clause that requires attorneys for both sides “will not make or cause to be made any other public comment regarding the settlement other than a court-ordered “mutually agreed upon statement.”