Greeley company files for Chapter 11 bankruptcy while facing lawsuits, liens and unpaid bills

GREELEY —  After a tumultuous year of trying to get out from under a mountain of debt — some of which was derived from alleged deceptive practices by lenders — a local civil construction and project management company has sought Chapter 11 bankruptcy protection.

Open Range Services Inc. filed for bankruptcy reorganization on July 31 while facing several lawsuits for unpaid loans, federal and state tax liens, mountains of credit card debt and unpaid bills.

In the bankruptcy proceeding, Open Range president Jason Gant reports that the company has $10.3 million in liabilities, about double what the company reports in bankruptcy documents as revenue last year, and dwarfing the $1.3 million in revenue the company recorded in the first half of 2024. Open Range claims assets of $2.45 million, which includes accounts receivable.

Open Range’s debts have piled up in the last few years. According to bankruptcy documents and Weld County records, the company has $1.26 million in federal tax liens; $6.3 million in outstanding loans secured by property; $113,477 in unpaid state withholding taxes; a lien for $7,379 for unpaid unemployment insurance; $11,514 in taxes owed to Weld County; and a $276,552 judgment that came down in April from a lawsuit from a New York company called Vivian Capital. Outstanding credit-card debt alone is almost $500,000, according to its bankruptcy documents.

In a lawsuit filed July 3, Cowboy Trucking of Gypsum, which performed trucking services for Open Range, stated that Open Range received cash advances from lenders that agreed to front the company money in exchange for a certain percentage of his accounts receivable. The lawsuit claims that those lenders engaged in “one or more unfair or deceptive trade practices in the course of its business or occupation.”

Cowboy Trucking is suing Open Range, and owners Gant and minority owner Gregory Martin, alleging that the company failed to pay 23 invoices totaling $307,348 to Cowboy Trucking. Cowboy also cites claims in the lawsuit against cash-advance companies Lendora Capital LLC and Vivian Capital Group LLC, for alleged violations of the Colorado Consumer Protection Act.

In the lawsuit, Cowboy Trucking claims that when Open Range took out the cash advances, there was enough money for Open Range to pay off its debts to Cowboy. The lawsuit states that Lendora advanced $1.478 million to Open Range in December 2022 in exchange for 8% of Open Range’s accounts receivable with a stipulated repayment of $2.66 million.

Cowboy stated that Open Range made sporadic payments on its debt to Cowboy, totaling $134,597 after that cash advance, but that the company did not catch up on all of its bills. According to the lawsuit, the agreement Open Range had with Lendora was that they had to establish a joint account in which Lendora was authorized to make daily withdrawals until that $2.6 million payment was received. From December 2022 to April 2023, Lendora took $799,211 out of Open Range’s account, the lawsuit claims.

The lawsuit states that Open Range did not tell Cowboy of this agreement with Lendora until September 2023. “By failing to disclose this arrangement, Open Range deliberately misled and deprived Cowboy Trucking of the opportunity to stop work earlier than it ultimately did,” the lawsuit states.

Cowboy Trucking claims that in that time, they could have taken action against Lendora for its “unlawful diversion” of money owed to Cowboy Trucking. The lawsuit claimed that Lendora “engaged in abusive or improper collection tactics,” as well, by demanding payments of open invoices directly from Open Range’s customers.

Cowboy trucking cites state law that says, “All funds disbursed to any contractor or subcontractor under any building, construction, or remodeling contract or on any construction project shall be held in trust for the payment of the subcontractors, laborer or material suppliers, or laborers who have furnished laborers, materials, services, or labor, who have a lien, or may have a lien, against the property, or who claim, or may claim, against a principal and surety under the provisions of this article and for which such disbursement was made.”

“Nevertheless, Open Range either sold or used said accounts receivable comprised of Trust funds as collateral in exchange for a cash advance, with full knowledge that Cowboy would never receive payments diverted by Lendora under the Lendora MCA Agreement,” the lawsuit states. Additionally, the lawsuit states, the Lendora agreement equates to an interest rate of 127%  which is higher than the maximum allowable rate of 45%, and “violates Colorado’s usury laws for business loans.”

The lawsuit claims that Open Range entered into another cash-advance arrangement with Vivian Capital Group for $135,000 in March 2023, in which he had to repay the company $224,850. (That is the New York company that secured a $276,552 judgment against Open Range in April). The same circumstances occurred, with the company demanding 6% of Open Range’s accounts receivable. Again, Open Range had to have a joint account in which Vivian could withdraw money. Vivian also demanded money directly from Open Range’s clients, the Cowboy Trucking lawsuit states. The lawsuit states that Vivian effectively charged an interest rate of 316%.

“Open Range never informed Cowboy of the VCG MCA Agreement — Cowboy discovered this during its own due diligence in preparing the complaint,” the lawsuit states.

Cowboy claims in the lawsuit that both lenders engaged in “unfair or deceptive trade practices” that “significantly impact the public.”

According to Open Range’s bankruptcy paperwork, Open Range has counterclaimed for $10.7 million against cash advance lenders in several New York cases suing them. 

Lenders in those cases together are seeking payment on cash advance agreements totalling about $3 million (including interest and costs) delivered throughout late 2022 and 2023. Plaintiffs in those cases are Lendora Capital LLC, Meged Funding Group Corp., Vivian Capital Group LLC, BMT Capital Group Inc., Alpine Advance 5 LLC, Cloudfund LLC and Daka Capital Group Inc.

Open Range’s counterclaims charge the lenders with interfering with its business contacting its customers directly for payment. That contact led Open Range’s customers to cancel their contracts with Open Range, the counterclaims state. 

In one case, Open Range won a default judgment in five of six counterclaims against Lendora Capital LLC, in which the Open Range was seeking $3.3 million in damages to its business. An inquest and assessment of damages hearing is set for Dec. 17 in that case. The other cases and counterclaims have yet to be settled. 

Gant could not be reached for comment, and officials at Open Range did not respond to an email request with questions.

Cases cited

Open Range Services Inc., Voluntary Petition for Chapter 11 Bankruptcy, Case No. 24-14377-MER, filed July 31, 2024, in U.S. Bankruptcy Court, Denver.

Cowboy Trucking LLC versus Open Range Services, Inc.; Jason Charles Gant; Gregory Ray Martin; Lendora Capital LLC, a New York limited liability company; and Vivian Capital Group LLC, a New York limited liability company. Case No. 24CV31037, filed July 3, 2024, in Weld District Court.

Lendora Capital LLC versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. 23CV30808 filed June 2, 2023, in Adams District Court.

Vivian Capital Group LLC versus Open Range Services Inc. and Jason Charles Gant, Case No. 607032/2023 filed June 15, 2023, in Nassau County Supreme Court, New York.

Lendora Capital LLC versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. 512436/2023 filed April 26, 2023, in Kings County Supreme Court, New York.

Meged Funding Group Corp. versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. 513424/2023 filed May 4, 2023, in Kings County Supreme Court, New York.

Pinnacle Business Funding LLC versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. 513851/2023 filed March 24, 2023, in Kings County Supreme Court, New York.

Daka Capital Group Inc. versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. 513881/2023 filed May 9, 2023, in Kings County Supreme Court, New York.

Alpine Advance 5 LLC versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. 514807/2023, filed May 18, 2023, in Kings County Supreme Court, New York.

Cloudfund LLC versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. 607825/2023, filed May 15, 2023 in Nassau County Supreme Court, New York.

BMT Capital Group Inc. versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. E2023011777, filed Oct. 11, 2023, in Monroe County Supreme Court, New York.

Lendora Capital LLC versus Open Range Services Inc., Jason Charles Gant, Gregory Ray Martin, Case No. E2024010890, filed July 2, 2024, in Monroe County Supreme Court, New York.