KIDS Inc. set to file Chapter 7 Lawyers finishing up with financial records El Paso Times 10/14/89
Attorneys still were sorting through financial records of the defunct KIDS of El Paso Inc. Friday, and expect to file a Chapter 7 bankruptcy petition next week in federal court on behalf of the organization. "I signed all the papers for the petition today," said ***, a businessman and president of the KIDS board of directors. "The lawyers are still trying to figure out exactly what the assets and liabilities are." KIDS was a controversial rehabilitation center for teenagers that provided long-term treatment for compulsive disorders, such as drug addiction and anorexia nervosa. The center, patterned after KIDS of America Inc. founded by ***, closed Monday. Critics said the program was too harsh, and that it abused clients physically and psychologically. Supporters of KIDS, including prominent families, who helped establish the program in El Paso, said it was the last resort for many troubled teenagers. *** said KIDS went nearly broke because of legal bills while defending its license. He attributed the sharply declining enrollment to negative publicity earlier this week, U-Haul trailers were seen parked in front of the KIDS center on Boeing Drive. *** said the trailers were being used to transport medical records from the building on city land near the airport. He said a partnership called Invincible Investors at first was created to buy the building, but that an estate facing foreclosure actually owns the building. "That foreclosure action took place long before the decision was made to file for Chapter 7 *** said. *** had said parents of the remaining 36 teen-agers at the center had the option of transferring their children to affiliated programs in New Jersey or Utah, ***, whose daughter successfully completed the program, said he was sorry to see KIDS leave El Paso. Several hundred teen-agers were enrolled during the center's four-year existence, but *** said he didn't know how many of them had completed the program.
KIDS closes doors over money trouble El Paso Times 10/10/89
The controversial KID of El Paso County Inc. rehabilitation program ended its stormy four year existence Monday, citing financial problems in the wake of a state investigation and negative publicity. "With great regret I announce that KIDS of El Paso County has closed its doors and filing for Chapter 7 bankruptcy today," said *** an El Paso businessman and chairman of the center's board. Under Chapter 7 of the federal Bankruptcy Code, the assets of KIDS will be sold off to pay claims from creditors. *** would not specify the programs' debt and the bankruptcy petition could not be filed Monday because federal courts were closed for the Columbus Day holiday. "The costs of defending our license, and the attendant negative publicity from this and other legal matters, have combined to create a financial situation from which we cannot expect to recover without substantial financial assistance which we do not see forthcoming," *** said. The center at 6531 Boeing in Central El Paso was started in 1985 by concerned parents of teen-agers with compulsive behavior problems, such as drug addiction and anorexia. It has been operating under a provisional state license. Last year, the Texas Commission on Alcohol and Drug Abuse recommended revoking the center's license after finding the center had abused clients and had violated state regulations. But a state judge in Austin allowed KIDS to continue operating until an administrative hearing on the matter was completed. This spring, the state commission agreed to reinstate KIDS' license for a year, provided it complied with state standards. Critics of the program claimed that some patients were held against their will and were abused physically and psychologically. Proponents, including many prominent El Pasoans, said the program was the last resort for families who had exhausted other methods in trying to help their children. ***, founder of the treatment program in Hackensack, N.J., said parents have the option of sending teen-agers currently enrolled at the El Paso center to affiliated programs in Salt Lake City or New Jersey. "It's kind of sad," ***, said. "(El Paso's center) got nit-picked to death, and the financial toll on it was too great." *** said 36 patients were enrolled when the El Paso center closed. Five or six families sent their children to the center in New Jersey, but I don't know how many chose to send their, children to Utah," he said. Even with its doors shut, the program's problems apparently are far from over. ***, a private detective who is representing 23 former El Paso KIDS patients, said a federal lawsuit alleging civil rights violations is being prepared and will be filed in court soon. *** said he has investigated the program since 1986 and is intimately familiar with its operations. "Nothing's changed," he said. "The problems, policies and procedures that were investigated by the Texas Commission on Alcohol and Drug Abuse merely have been transferred to another state." *** said 20 to 25 El Paso KIDS patients were flown on a private plane over the weekend to Salt Lake City. "The El Paso group helped to bolster the enrollment at Utah's center, which opened about a month ago" he said. The El Paso center had about 90 clients in September before the enrollment dropped sharply." ***, an El Paso lawyer who represents former KIDS patients, said he helped a 19 year-old who had been taken to the New Jersey center against his will three weeks ago. "He had called me from New Jersey, and I sent him the busfare to return to El Paso," *** said. He had called from New Jersey and I sent him the busfare to return to El Paso." *** said.
Creditors set to examine assets of KIDS program Drug rehabilitation center has meeting today El Paso Times
Creditors will sort through the assets of bankrupt KIDS of El Paso Inc. during a meeting at the Federal Courthouse today, KIDS' lawyer *** said. KIDS of El Paso, a controversial rehabilitation program that filed for bankruptcy Oct. 16, has listed assets of $86,000, and debts of $225,000, according to U.S. District Court records. *** said when assets finally are distributed creditors probably will be paid only a percentage of what they are owed. At least one creditor - and harsh critic of the program said he had not been told of the meeting. After being told of the 10:30 a.m. meeting, private investigator *** said he would be there. But, he added, when the KIDS of El Paso people saw him, the meeting might be canceled. *** said he had helped about 20 disgruntled KIDS clients prepare a class action lawsuit against the center. The board of directors, including Chairman ***, ***, and ***, voted Oct. 4 to close the center and file for bankruptcy. ***, spokesman for KIDS of El Paso, could not be reached for comment. Although court records show that KIDS may owe more than 500 companies and individuals, *** said the actual number probably is closer to 250. "They've listed people they feel will sue and anybody and everybody they could possibly owe money to," he said. "You can bet I'm showing up, though. I have a right to certain information. I want to get some answers."
More than 500 companies and individuals may have potential claims totaling $225,000 against bankrupt Kids of El Paso Inc., according to court records in U.S. District Court. The controversial rehabilitation center for teen-agers filed for bankruptcy under Chapter 7 of the federal bankruptcy statutes Monday, saying it had $86,000 in assets. A breakdown of detailed expenses and assets were not included in the bankruptcy documents. Two of the center's most vocal critics, *** and ***, are among those listed as creditors in KIDS' bankruptcy petition. ***, an attorney, and ***, a private investigator and former police officer, have assisted former patients who complained they were mistreated or held against their will at the treatment center. KIDS Chairman *** said the center doesn't owe *** or *** any money, but both have made public statements indicating they might have financial claims against KIDS in the future. *** has said he's helping about 20 disgruntled KIDS clients to prepare a class action suit against the center. "It's news to me that KIDS believes it owes me any money," *** said. *** said KIDS doesn't owe him money, "but it has cost me a lot of money over the years," mostly by helping runaway, clients with such things as money for transportation. Court records show the KIDS board of directors, including ***, *** and ***, voted Oct. 4 to close the center and file for bankruptcy. Poor community support during a recent fund-raiser, a suit against an El Paso doctor and the fact that former KIDS clients were being asked to join a class-action suit were among topics discussed at the meeting *** said KIDS could no longer afford legal expenses to defend its state license, and had suffered a sharp drop in enrollment that he blamed on negative publicity. "it's news to me that KIDS believes it owes me any money." ***.""
Sinister operation gone from El Paso 11/02/89
""The departure of the psychotherapy cult known as Kids of El Paso ends one of the most bizarre chapters in the history of our community. It's still hard for me to believe that such a sinister operation was possible in our sleepy, big-little town. If we look carefully, we should learn some lessons about politics, money and the evil they can sanction. But we also can take comfort in the ultimate sovereignty of the people once they have been informed by a free press. A few years ago, a handful of worried parents whose bank accounts exceeded their parenting skills heard about a drug "treatment" program that assuaged their guilt at being failed parents who had lost their kids somewhere in the maze of materialism. This program convinced them that these children deserved to be brutalized in almost every way imaginable. And so the cult pursued its perverse mission with a vengeance, and the toll on families torn apart and children embittered and abused never will be known fully. Slowly, some of our own institutions of government that are supposed to protect children began to operate. Soon, money and politics got in the way. A state senator whose cavalier attitude about morality, government and money is a matter of public record, a couple of local politicians whose appetite for power is only starting to become apparent, and an attorney general who allowed himself to be compromised by local politics all combined to put the fix in the cult, and instead of prosecuting it for its abuses, set out to persecute those that dared expose it. But in the meantime, the people were becoming informed, and the magnitude of this evil proved too great to be hidden from an often too apathetic public. For that reason, a recent fund-raising effort by this evil thing failed. Sadly, left behind are various victims, most importantly, too many young people whose lives are permanently scarred. They are followed in the parade by mothers, fathers, siblings and in some cases by grandparents who recognized the evil for what it was but who, for various reasons, were powerless to prevent it. Bringing up the rear are the do-gooders who dared to intervene and upset the vile applecart and incurred the unending wrath of the octopus that gave the cult its genesis and then sought to protect it. We, the people, remain the ultimate sovereign. But it is so important that we know what happens around us. Only by knowing and acting can we foil those forces that sometimes make our democracy seem illusory. If we yield our power, the aristocrats gladly will take it from us.""