Athens Review, Athens, Texas

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July 11, 2013

A costly waiting game

A year later, Lon Morris still hasn't paid some employees

Athens — JACKSONVILLE — Several former Lon Morris College employees who were not paid when the school went under in July 2012 are still striving to recover lost wages that might – at least partially – be awarded by August.

A formal liquidation plan involving the bulk of the LMC bankruptcy estate was approved by a federal judge in February. However, absolutely nothing was included in any official paperwork addressing payment for these stricken employees.

Dawn Ragan, plan agent for the bankrupt and now liquidated Lon Morris, has said she is working to determine how much is still owed these employees. Meanwhile, many former LMC employees report they are receiving counter-offers for amounts that are much, much less than what is actually due them.

There is, for instance, the case of former employee Sheri Myers. Myers is adamant in her written objections to Federal Judge Bill Parker in the  United States Bankruptcy Court Eastern District of Texas that she is being short-changed.

 The LMC estate objection to her claim contends Myers is only owed $501.53 in compensation, not the $5,208 she is claiming.

Myers disagrees.

“I object to the adjustment of monies owed to me by Lon Morris College,” Myers said in her communication with the court. “Three pay checks are owed to me for work I performed and each pay period was salaried work. … I do not know how Dawn Ragan came to the amount of $501.53.”

Ragan did not return a request for comment Friday. But in correspondence already posted on the Lon Morris web page, she has stated payouts to employees could come as early as August.

This doesn't leave a lot of time before final decisions on the part of the employees will have to be made.

In her communication posted online on the Lon Morris website, Ragan acknowledged she had filed a series of objections to claims of creditors in the bankruptcy case, “as was required under the 'Plan of Liquidation.'”

“With respect to the wage claims of employees, there were also objections filed,” Ragan wrote. “Generally those objections are for the purpose of correcting the amount filed by the employee where it either differed from the school’s records, didn’t account for the prior distributions made for funds received from the Church or the Foundations, or had arbitrary penalties added to the unpaid wage amount.”

Ragan contends these objections only relate to correcting the amounts owed, and don't actually mean the debtor is objecting to paying the wage claims.

“The debtor does still intend to pay the prior unpaid wages when it receives the funding from the foundations,” Ragan wrote. “We have been working diligently with the foundations, and previously with the Texas Attorney General’s office, to finalize these matters, and regret the significant delays employees have experienced since these funds were committed.”

Thomas Kelley, spokesman for Texas Attorney General Greg Abbott, has repeatedly denied the office is working with Ragan in any capacity to facilitate these payments.

But Ragan, who has not provided former LMC employees with a lot of specifics about their pay thus far, was uncharacteristically concrete in her contention that everything should conclude in August.

“We have recently been advised the funds and distributions are anticipated to occur in August,” Ragan wrote. “We will keep you apprised of further updates as we get them.”

One former employee recalled that back in December these LMC employees were offered a “convenience claim” option on the same form containing the ballot to either accept or reject the proposed bankruptcy plan. 

Not many people accepted this option, but a few did and have since received payment, reports show.

Some former employees like  Jason Thomas, a former Lon Morris College athletic trainer, believe it has been far too long since any useful information on pay has been offered up by the LMC estate.

“It's about time we get more information or even an update,” Thomas said. “However, I'll believe the payment of unpaid wages when I get the money that I am owed. I hope that it is in August or sooner.”

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