Ok... just a note from a guy who works in a school district...
I find Olimario's story plausible, but only if the school district didn't have all the information. If you were scheduled into two different classes during the same period, and you were always attending one of them, the school should not kick you out -- the mistake wasn't made by you. Even if your counselor DID notice this and alert you, I don't think you'd be responsible if you ignored it completely... worst case scenario should be that you'd have to retake a course the next semester. This was clearly a scheduling error, and you couldn't be held responsible. However, if you didn't point this fact out to the proper people (the school district itself, for example), there isn't much you can do about it.
There are plenty of stupid folks working in administration, but this mistake would have been understood if it were brought up to a higher district authority.
Oh, as a side note, does anyone CARE about high school records once you graduate from college? Perhaps it just depends on the industry you enter into... no one cares how a teacher did before he or she entered college.