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SEC Filings

10-Q
GRAHAM HOLDINGS CO filed this Form 10-Q on 11/01/2017
Entire Document
 


The amounts and line items of reclassifications out of Accumulated Other Comprehensive Income (Loss) are as follows:
  
Three Months Ended 
 September 30
 
Nine Months Ended 
 September 30
 
Affected Line Item in the Condensed Consolidated Statement of Operations
  
 
 
(in thousands)
2017
 
2016
 
2017
 
2016
 
Unrealized Gains on Available-for-sale Securities:
 
 
  
 
  
 
  
 
  
Realized gain for the period
$

 
$

 
$

 
$
(6,256
)
 
Other income (expense), net
  

 

 

 
2,502

 
Provision for Income Taxes
  

 

 

 
(3,754
)
 
Net of Tax
Pension and Other Postretirement Plans:
  
 
  
 
 
 
  
 
  
Amortization of net prior service cost
118

 
105

 
358

 
314

 
(1)
Amortization of net actuarial (gain) loss
(1,567
)
 
289

 
(4,958
)
 
868

 
(1)
  
(1,449
)
 
394

 
(4,600
)
 
1,182

 
Before tax
  
580

 
(157
)
 
1,840

 
(472
)
 
Provision for Income Taxes
  
(869
)
 
237

 
(2,760
)
 
710

 
Net of Tax
Cash Flow Hedge
 
 
 
 
 
 
  
 
  
  
51

 
(3
)
 
123

 
(3
)
 
Interest expense
  
(11
)
 
1

 
(25
)
 
1

 
Provision for Income Taxes
  
40

 
(2
)
 
98

 
(2
)
 
Net of Tax
Total reclassification for the period
$
(829
)
 
$
235

 
$
(2,662
)
 
$
(3,046
)
 
Net of Tax
____________
(1)
These accumulated other comprehensive income components are included in the computation of net periodic pension and postretirement plan cost (see Note 8).
11. CONTINGENCIES
Litigation, Legal and Other Matters.  The Company and its subsidiaries are involved in various legal, regulatory and other proceedings that arise in the ordinary course of its business. Although the outcomes of these proceedings against the Company cannot be predicted with certainty, based on currently available information, management believes that there are no existing claims or proceedings (asserted or unasserted) that are likely to have a material effect on the Company’s business, financial condition, results of operations or cash flows. However, based on currently available information, management believes it is reasonably possible that future losses from existing and threatened legal, regulatory and other proceedings in excess of the amounts recorded could reach approximately $25 million.
Kaplan subsidiaries were subject to two unsealed cases filed by former employees that include, among other allegations, claims under the False Claims Act relating to eligibility for Title IV funding. The U.S. Government declined to intervene in all cases, and, as previously reported, court decisions either dismissed the cases in their entirety or narrowed the scope of their allegations. The two cases are captioned: United States of America ex rel. Carlos Urquilla-Diaz et al. v. Kaplan University et al. (“Diaz”, unsealed March 25, 2008) and United States of America ex rel. Charles Jajdelski v. Kaplan Higher Education Corp. et al. (“Jajdelski”, unsealed January 6, 2009).
On August 17, 2011, the U.S. District Court for the Southern District of Florida issued a series of rulings in the Diaz case, which actually included three separate complainants: Diaz, Wilcox and Gillespie. The court dismissed the Wilcox complaint in its entirety; dismissed all False Claims Act allegations in the Diaz complaint, leaving only an individual employment claim; and dismissed in part the Gillespie complaint limiting the scope and time frame of its False Claims Act allegations regarding compliance with the U.S. Federal Rehabilitation Act. On July 16, 2013, the court entered summary judgment in favor of the Company on all remaining claims in the Gillespie complaint and on March 11, 2015, the U.S. Court of Appeals for the Eleventh Judicial Circuit affirmed that dismissal ending the Gillespie claims in Kaplan’s favor. On October 31, 2012, the court entered summary judgment in favor of the Company as to the sole remaining employment claim in the Diaz complaint. And, on March 11, 2015, the appellate court affirmed the summary judgment on all issues in the Diaz case except the court reversed and remanded Diaz’s claim that incentive compensation for admissions representatives was improperly based solely on enrollments in violation of the Title IV regulations. On July 13, 2017, the District Court again granted summary judgment on this final issue in the Diaz case in Kaplan’s favor, ending the case at the U.S. District Court level; the plaintiff has filed a notice of appeal.
On July 7, 2011, the U.S. District Court for the District of Nevada dismissed the Jajdelski complaint in its entirety and entered a final judgment in favor of Kaplan. On February 13, 2013, the U.S. Circuit Court for the Ninth Judicial Circuit affirmed the dismissal in part and reversed the dismissal on one allegation under the False Claims Act relating to eligibility for Title IV funding based on claims of false attendance. The surviving claim was remanded to the District Court, where Kaplan was again granted summary judgment on March 9, 2015. Plaintiff has appealed this judgment and briefing is complete. In March 2017, the Appellate Court denied the appeal and ruled fully in

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