In the movie or in the series?
In the movie they did kick him out because he was planning on taking over the gang and because they got on his nerves.(I'm a big Scrappy fan, so I basically hated that part of the movie)
In the series, i'm guessing since he refered to Scooby as uncle Scooby then Scrappy lives with his mom or dad, and only visited Scooby and the gang every now and then.
I'm not sure if that's true or not, that's just what I think. But they sooooo need to bring Scrappy back. Come fanpoppers, let's petetion.

In the first scooby movie he was sooooooo annoying they kicked him out and he became EVIL!

he got kiked out of the serises on the fist realistice moive i luv scooby not scrappy i would marry shaggy if i could :D

In the first live action movie, he was put behind bars for trying to get rid of Scooby and the gang.

He was arrested in the first movie!!

He peed on Daphine...REMEMBER Scooby-Doo"1"