Apple will repay $4.2 million to settle a claim by the Los Angeles Unified School District (LAUSD) over a catastrophic educational program where Apple and Pearson were partners.
Another $2.2 million in credit will be given by Lenovo, which charged the school district for the purchase of laptops. Lenovo partnered with Pearson as well.
The arrangement is the result of a cancelled $1.3 billion plan to offer an iPad unit to each teacher, student and campus administrator in the district. The Board of Education will be voting on the settlement this month.
The contract stated that Apple would provide the LAUSD the iPad units and Pearson would implement the curriculum on the tablets.
When the Apple pact was discussed, Pearson was appointed to create all the math and English curriculum for the school system. A three-year license for the Pearson curriculum was included, which added around $200 to the price of each device.
Over 40,000 Apple tablets were purchased, all featuring the curriculum from Pearson, at a cost of $768 per iPad.
Suspicions over the initial contract led to a probe by the Federal Bureau of Investigation (FBI) and the Securities and Exchange Commission (SEC).
Multiple problems also arose: the teachers received insufficient training on the tablets and the district accused Pearson of implementing software with glitches. Further inquiry showed that the teachers hardly ever used the Pearson software at all.
There were talks about a full-blown court case as the district was considering a lawsuit over the Apple-Pearson contract.
For Apple, the settlement seemed the easy way out. Pearson also clarified that other school districts continue to use the same online courses.
Payment through the settlement will be used to acquire new computer devices for the LAUSD under a grant program that will assess the readiness of a school in handling the technology.
Gregory L. McNair, senior attorney for the LAUSD, says the program taught the district a costly lesson. Schools should be prepared to handle the technology even before receiving it.
"The $6.4 million in proceeds represents an exciting opportunity to invest in such schools and to promote collaboration among campuses," Supt. Ramon C. Cortines said in a memo to the Board of Education.
The Los Angeles Unified School District is composed of about 1,000 schools and offers a computer to every student in 100 campuses. In some campuses, however, students get by with fewer devices.
