Corsicana Daily Sun, Corsicana, Texas

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March 31, 2013

Former Lon Morris employees say they are still owed back wages

TYLER — Lots of money seems to be changing hands in the final days of the Lon Morris College bankruptcy estate — but none of it seems to be going toward paying the back wages of former LMC employees.

A federal judge approved the formal liquidation plan for the Lon Morris College estate in mid-February. But there was nothing in its language that addressed payment for these workers — who have yet to be reimbursed for their final weeks at the institution — in either the plan itself or federal bankruptcy Judge Bill Parker's ultimate order.

But then-LMC Chief Restructuring Officer Dawn Ragan and Houston attorney Hugh Ray III dispatched press releases to reporters, assuring them that agreements had been reached with several Methodist foundations and were expected to result in former employees receiving all owed money.

Fast forward to Thursday — more than a month later — and more than a million dollars has been expended in last-minute negotiations and deals between the LMC estate and debtors. But apparently, not a cent of that gone toward employees.

“No word. No money,” said Michelle Zenor, a former associate professor of English at LMC.

When asked about the status of the payments, Thomas Kelley, spokesman for Texas Attorney General Greg Abbott, said responsibility for it lays squarely on the shoulders Dawn Ragan, “"whose new position as liquidating trustee was created under the Plan of Liquidation.”

“The timing of 'if' or 'when' she will pay employees their back wages is totally up to her,” Kelley said.

Neither Ragan nor Hugh Ray, an attorney working with the LMC estate have responded in months to the Jacksonville Daily Progress' requests for comment.

In one release, Ragan recalled that the Texas Annual Conference of the United Methodist Church organized an earlier humanitarian appeal that generated enough funds to cover one missed payroll for the school’s former employees. But the agency closed early Thursday and a representative could not be reached to comment about any possible payment status.

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