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Cold Springs Correctional Facility (Mansfield Boot Camp), Fort Worth, Texas

October 22, 2005 Sarasota Herald Tribune

Correctional Services Corp. has settled a $38.3 million judgment that held the company responsible for the death of an 18-year-old inmate at a Texas boot camp. Terms of the agreement are confidential, but the Sarasota-based prison manager said Friday it will pay $2.7 million toward the settlement. The rest will be covered by CSC's liability insurers, which initially balked at paying the award. The agreement is contingent on the closing of CSC's previously announced sale to The GEO Group Inc. for $62 million. CSC shareholders will vote on the sale Nov. 4. If that deal falls through, so does the settlement.

A Texas jury in August 2003 found CSC and a nurse at the now-closed Mansfield boot camp responsible for the death of Bryan D. Alexander. Alexander, serving a six-month sentence for a misdemeanor driving conviction, died in 2001 of a rare penicillin-resistant form of pneumonia.

Trial testimony showed he was treated for a cold and flu even though he had coughed up blood for five days before his death. His parents sued CSC and nurse Knyvett Reyes for their loss and anguish.

Reyes was convicted of negligent homicide and was sentenced to four years of community supervision. She also surrendered her registered nurse's license.

The judgment against CSC and Reyes included $35 million in actual damages, $750,000 in punitive damages and more than $2.4 million in interest. The settlement will resolve all claims and lawsuits against CSC and Reyes. It also will end a dispute between CSC and its liability insurers over who should pay. Boca Raton-based GEO is paying $62 million in cash, or $6 a share, and assuming $124 million in liabilities to acquire CSC.

It will then sell the Youth Services International subsidiary to CSC president James Slattery for $3.75 million. That unit manages programs at 17 centers with 1,300 beds. GEO will acquire the adult division that owns or operates 15 facilities with 7,500 beds. GEO manages 41 prisons and jails with 36,000 beds in the United States, Australia, South Africa and Canada. Shares of CSC were selling for $5.91 on the Nasdaq at the close of trading Friday, up 1 cent.

 

 

 
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