Daily Progress, Jacksonville, TX

February 21, 2013

Miles McCall: Lon Morris owes me nearly $155,000

Status of McCall's claim unclear since LMC estate sale has been completed

Ben Tinsley
Jacksonville Daily Progress


Miles McCall – the former president of Lon Morris College who has been accused of illegally liquidating an endowment fund earmarked for Sam Houston State University – has filed a formal objection to the LMC bankruptcy proceedings, demanding reimbursement for back pay and a personal loan he alleges he made to the institution.

It was not immediately clear Wednesday if it is too late to file further action against the LMC bankruptcy estate, since federal bankruptcy Judge Bill Parker issued a formal order earlier this month confirming the Lon Morris College bankruptcy estate sale and debtor's plan of reorganization.

Around the same time McCall filed his paperwork Tuesday, Tilley, LLC filed their own objection, requesting Parker allow them a general unsecured claim against the estate in the amount of $4,903,000. That status was equally unclear on Wednesday.

Neither McCall or LMC Chief Restructuring Officer Dawn Ragan could be reached to comment Wednesday.

McCall is in the process of being sued  by Sam Houston State University officials – under the guidance of the AG's office.  

Both SMSU and the attorney general – the AG in its capacity as the protector of the public's interest in charity – seek to recover over $1 million in lost endowment monies SHSU officials contend they should have been forwarded when LMC first declared bankruptcy.

Thomas Kelley, spokesman for Texas Attorney General Greg Abbott, declined immediate comment regarding the McCall issue.

In his formal protest filed Tuesday, McCall demands $74,289.26 in back wages — $50,000 of that is deferred compensation – as well as repayment for an $80,000 loan he alleges that he made to the institution.

McCall alleges he was one of several members of the executive staff and board of trusses at Lon Morris who made personal loans to the college to enable them to meet basic financial obligations in the months and years leading up to the bankruptcy case.

In his paperwork, McCall also concedes that the money was part of an oral, not a written, contact.

"This loan was known to the debtor at the time it was made," according to McCall's filings.