BATON ROUGE – The owner of a Baton Rouge construction firm, who was recently indicted by a federal grand jury on multiple fraud counts related to the construction of a charter school in Baker, has had so many state and federal lawsuits filed against him that attorneys worry that they may not be able to get relief for their clients.
Nathian Hossley, owner of First Millennium construction, worked as a subcontractor for concrete work on the Impact Charter School in Baker. He allegedly defrauded Bouma Construction, the Michigan company that contracted him, by providing false information on a qualification statement in a bid for the project. He then allegedly submitted applications for payments that falsely represented the work that had been completed.
According to a press release from the U.S. Attorney's Office for the Middle District of Louisiana, Hossley also allegedly forged signatures on joint check agreements and lien waivers to obtain $96,125 in joint checks, and then forged subcontractors endorsements to deposit the checks into First Millennium’s account.
Ultimately, the indictment alleges that tens of thousands of dollars were diverted to private sources and that less than half of the money paid by Bouma was used for its intended purpose of paying subcontractors.
The indictment is just the latest in a series of legal troubles that have plagued Hossley over the last few years. In 2015 alone, at least seven legal actions were started against Hossley, including a sale-and-seizure notice for his home after he defaulted on a promissory note and a warrant for his arrest after he wrote three bad checks totaling $3,000. He subsequently paid the mortgage company and the balance of the checks.
Bouma Construction filed its own suit in April 2015, seeking $575,000. Other construction-related suits came from the Capital Area Transit System after it paid First Millennium for 30 bus shelters and allegedly only 20 were completed.
Technically, the federal indictment poses no barrier to private organizations pursuing claims against Hossley, Amy Bernadas, a partner at Krebs Farley, told the Louisiana Record. Bernadas represents North American Specialty Insurance Company, which bonded First Millennium.
“Generally, as a matter of course, the surety requires an indemnity agreement,” Bernadas said.
What that mean is, if the surety company incurs loss because the contractor doesn’t finish a job, the work is defective or subcontractors have not been paid, then the surety can take legal action to recoup its loss. In this case, the company alleged that the work was not completed and it filed its complaint in April 2011 in the Eastern District of Louisiana.
“If he’s in jail, it may be hard for him to attend an arbitration,” Bernadas said.
Even if he does not go to jail, recent history would suggest that Hossley might not attend arbitration hearings.
In 2009, Hossley and his company allegedly walked away from the job site for a Head Start center in Jefferson Parish. The surety company filed suit, saying the work had not been completed and subcontractors had not been paid the nearly $600,000 Hossley owed them. Litigation in that case continued for nearly four years, until both sides agreed to arbitration. Hossley failed to appear at the hearings; and in 2015, the case was reopened.