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Construction company blames legal dispute with Arlington ISD for bankruptcy filing

Construction company blames legal dispute with Arlington ISD for bankruptcy filing
Construction company blames legal dispute with Arlington ISD for bankruptcy filing 02:43

ARLINGTON, Texas (CBSDFW.COM) - A North Texas construction company is permanently closing its doors, leaving dozens of customers with thousands of dollars of unfinished work.

The owner of RJ Construction blames the Arlington Independent School District for the bankruptcy filing, claiming the district never paid the company for work it did on a school damaged by Winter Storm Uri in February 2021.

RJ Construction's fight against AISD received a lot of attention in the past year and garnered the company's owner, Robert Jordan, a good deal of community support.

Now, many of those same supporters say they're the real victims in all this.

"She lost her house once in a fire, and she lost it again to RJ Construction," said Travis Hyden, who said his mom turned to RJ Construction to help her rebuild after a devastating house fire.

According to Hyden, she paid RJ Construction $115,000 upfront earlier this year, but the company never got started on the project.

"He took innocent people's money and shut the doors, and now he's trying to hide behind Chapter 7 bankruptcy," Hyden said.

Hyden's mom is one of dozens of clients coming forward with similar stories of unfinished work.

"You feel betrayed," said an Arlington homeowner who did not want to be identified. "You do. You feel taken advantage of. A lot of good people are without jobs, and a lot of people like me are out thousands of dollars, in Arlington and probably all around the metroplex."

In an email sent to customers, RJ Construction owner Robert Jordan said, "To be clear, RJ Construction's demise was a direct and calculated goal of The Arlington ISD." He detailed the ongoing legal dispute, and said "Had I never taken that job, none of us would be in this situation."

Last fall, Jordan told CBS 11 that AISD refused to pay a $1.2 million invoice for the company's work cleaning up Sam Houston High School after damage from the February 2021 winter storm.

He subsequently filed suit against the district.

In a three-page fact sheet released by AISD, the district refuted many of his claims and said an insurance adjustor valued the work RJ Construction did at just under $180,000.

In that statement, the district said, "Arlington ISD has never had any desire or motivation to bankrupt RJ Construction. At the same time, Arlington ISD has a duty to ensure that taxpayer money is spent only on actually performed and documented services."

"They didn't want to see a friend get taken advantage of, and that's why we all supported him," Hyden said. "He turned around and did the same thing to all of us."

Many of RJ Construction's former customers are coming together to take against action the Jordan.

"Recovery of funds might be out of the question, but if at least some sort of justice can be brought to us and all the other families affected, that would at least make us feel a little better about the situation," Hyden said.

At least four reports against the company have been filed with Dalworthington Gardens police. The department says the investigation is in the preliminary stages and they are currently working to determine if criminal charges are applicable.

Attorney Michael Hammond, who represents Jordan, says he understands why clients feel frustrated, but that Jordan had no fraudulent or criminal intent.

"Robert Jordan is a good man who has tried everything possible to avoid being in this position," Hammond said. "He is committed to doing everything in his power to make this right."

According to Hammond, Jordan was working to sell the company and thought the jobs would be completed by another owner. The decision to file for bankruptcy was last minute.

"He is going to continue to pursue the lawsuit against Arlington ISD, which was the domino that created this problem," said Hammond.

Hammond says there will be a creditors meeting in mid-September to vet claims against Jordan and RJ Construction.

"He said he was going to do right by all his customers," said a client who hired RJ Construction. "Well, how? Prove it. Prove that you are."

This the full email Jordan sent clients, obtained by CBS 11:

Customers of RJ Construction, 

By now you no doubt know that RJ Construction has closed its doors and has permanently ceased all operations. I understand that this decision is met with a great deal of frustration, anger,  and many unanswered questions.

I want to assure you that I did everything possible to try and save this business, the jobs of our employees, and to honor the obligations we had to each one of you. This result is nothing short of the worst-case scenario that I have been trying desperately to avoid. 

Until very recently, I had been in closing discussions for a larger company to purchase RJ Construction, which would have saved our current projects, and the jobs of all of those who have worked with me through this difficult time. We were so close, lawyers for both sides were negotiating the final sales documents. Unfortunately, we experienced a greater exodus of key staff members than anticipated which proved fatal to the acquisition. 

I can assure you that up until only a day or so before  I was forced to close the doors. I had every reason to believe that our company would continue and the jobs we had been hired on to do would be completed seamlessly. 

To be clear, RJ Construction's demise was a direct and calculated goal of The Arlington ISD. Their refusal to pay a legitimate invoice for services rendered, created a situation where more than 25% of our outstanding Accounts Receivable (AR) was tied up in litigation. Which triggered the cancellation of an acquisition in the fall of  2021, the loss of our line of credit, loss of a Forbes Top 20 client, loss of our ability to become bonded, and loss of any and all future public work. We were forced to sue a school district in an attempt to be paid. The district's attorney even went so far as to say in open court and on the record that they would fight this suit until I had "lost everything."

I'm certain that this explanation does nothing to provide anyone with any meaningful relief, but it is important to me that the accuracy of the events and the direct cause of this situation is known to those affected. There has been a great deal of information from both sides on this public dispute, but the provable fact is this: I trusted a lifelong friend and school board trustee who assured me not to worry about the red tape and get the job done at Sam Houston High School. Only after my team did what we were asked did the AISD then make demands for documents and expectations that they never required before, during, or after we closed out the job. Had I never taken that job, none of us would be in this situation.

Just today, all three offices of RJ Construction have filed for protection under Chapter 7 of the United States Code. This is a liquidation bankruptcy and spells the end of RJ Construction. While I would love to speak with everyone individually, on advice of counsel, I cannot speak to anyone with a claim against RJ Construction.

Each of you with a claim or potential claim should be notified in the near future by the Bankruptcy Court. Please be on the lookout for a mailing from the United States District Court, Northern District of Texas.



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