Bryman College Operator Files for Chapter 11

For-profit school company BioHealth College Inc., which operates four Bryman College campuses in California, has filed for Chapter 11 bankruptcy protection.

It wasn’t immediately clear Monday what would happen as a result of the Chapter 11 filing. However, a bankruptcy filing would usually result in the U.S. Department of Education revoking the schools’ status as an institution that can accept federal student financial aid dollars. Most colleges can’t survive without that funding.

BioHealth College acquired Everest College campuses in San Jose, San Francisco, Hayward and Los Angeles in January 2013 from Corinthian Colleges—a for-profit college operator with more than 100 schools that is now in the process of winding down its own operations—and changed the schools’ names to Bryman. Prior to this, BioHealth operated a for-profit medical-training school in San Jose.

Corinthian paid BioHealth $2.3 million in January 2013 to take over these schools, according to filings made with the U.S. Securities and Exchange Commission. The schools had been placed in “discontinued operations” the year prior, Corinthian Chief Financial Officer Bob Owen said in a conference call announcing the sale.

In May of this year, local media outlets reported that the Bryman San Jose campus shut down temporarily amid a dispute with its landlord. According to ABC affiliate KGO, BioHealth owed its landlord $80,000, but the two reached an agreement to reopen the school within days.

Neither a representative for BioHealth Colleges nor its bankruptcy lawyer returned request for comment Monday. The company was scheduled to make its first bankruptcy-court appearance in San Jose on Monday afternoon.

BioHealth Chief Executive Sam Shirazi founded a company called Computer Training Academy Inc. in 1990, according to BioHealth’s website. He eventually sold that company to Corinthian Colleges in 2000.

In 2003, Mr. Shirazi launched BioHealth College, a school that specialized in pharmacy technician and biotechnology technician courses. It had 192 students in 2012, prior to the acquisition of the Bryman campuses. The original BioHealth College now shares a campus with Bryman San Jose.

The four Bryman campuses offer programs including dental assistant, massage therapy, medical assistant and medical insurance billing and coding. Tuition for these diploma programs ranged from $16,000 to $18,000 in 2013. During the 2011-2012 school year, which is the last time this data was provided, students used a median of $9,450 in federal student loan money to pay tuition. Current enrollment numbers weren’t immediately available.

According to court filings, BioHealth has fewer than $50,000 in assets and between $1 million and $10 million in liabilities.

Write to Stephanie Gleason at [email protected]. Follow her on Twitter @stephgleason.