Upaya (expedient means) is, among other things, Buddhism's way of explaining other religions. This story from the Lotus Sutra is often used to describe the concept of upaya: A rich man comes home to find that his house is burning down. His children are inside the house, and he calls out to them telling them to get out. For some reason the children don't understand the concept of fire or that they are in danger. They reply that they are busy playing their games and don't want to leave. So their father lies: He tells them that a festival has come to town with better games and that they should leave the games they are playing and come out. And so they do, and they are saved. The gods and holy men of other religions, according to Buddhism, are Bodhisattvas in disguise. They appeared to those people at those times in the only way they could understand and spoke to them in the language of their understanding. While some may consider this somewhat condescending, it's at least more fair minded than the Christian method of dealing with other religions: telling their constituents that their gods either don't exist or are devils and that their holy men are either liars or fools.
Some Western Buddhist teachers, however, have used the concept of upaya for suspect purposes. One had AIDS and had sex with his students without telling them he was infected-afterwards saying that this was to teach them about impermanence. On a much lesser scale, there was a teacher of a different sort, an academic professor, who was teaching a course on Buddhism and decided to fail all his students as a lesson in nonattachment. Needless to say, they were not pleased.1
An answer that has been given to defend the concept of upaya against these types of actions has been to say that these individuals, not being Bodhisattvas, were not in a position to use upaya. But I think it would be inconsistent to argue for upaya as an ethical position when performed by a Bodhisattva but not by anyone else. Who does something is not relevant. The only thing relevant is the structure of the act itself.2 If children are burning up in a house and you need to lie to save them, it doesn't matter if you are their father, a passerby, or one of the children. Individuals may not always be able to determine perfectly when something is appropriate and when it isn't-but that's life. We have to make judgment calls to the best of our ability. The farmer who passes by the burning house and doesn't lie to save the children's lives because he doesn't know if he's allowed doesn't escape causal responsibility for the results of his actions or lack thereof.
Now, one may say, isn't the one teacher really just taking advantage of his pupils to fulfill his own sexual desires in the first case? I think he probably is. I don't see this as being relevant, however. What is relevant is whether or not the actions support the goal.
Does receiving the grade of an F force you to face the fact that you are attached to your grades? Does getting AIDS force you to face your attachment to life?
I think everyone that answers honestly and objectively would have to answer in the affirmative, that they do.
And should you be attached to these things, according to the Buddhist worldview?
I think anyone answering honestly and objectively would have to answer in the negative, that you shouldn't.
So these teachers acted rightly in accordance with Buddhist principles. I cannot see another option. I think people don't want to accept this because they don't like the conclusion, but that, too, seems irrelevant. Either renounce Buddhism or renounce your attachment to life and self. Right? What other option is there?
To say, "I am a Buddhist, but that teacher acted wrongly in infecting me with AIDS" is to be inconsistent. You don't really believe that life and self should be renounced.
More to the point, for us to describe the truth of a situation to the best of our ability requires that we describe it from as many different angles as possible. When we do this, however, we come up with different descriptions that may sometimes seem to contradict each other but which are nonetheless true, taken in context-what is known as a paradox. As always, language is a problem. Different words are used in different senses, and it can be confusing.
1 Both these stories come from Prof. Elizabeth Kenney's lecture on upaya that I heard when I took her "Religion in Japan" course at Kansai Gaidai University in the spring semester of 2006. I'm telling them from memory. The Western Buddhist teacher with AIDS was probably Ísel Tendzin. I'm pretty sure the academic professor that failed his entire Buddhist class was one of her former colleagues.