Customers hurt by AmerLink bankruptcy

By John Henderson
Rocky Mount Telegram

Friday, July 10, 2009

Regina Lagace thought she had found her dream home when she saw the model of the AmerLink two-story log cabin home.

Last year, she plopped down a $75,000 deposit on the home from the sales proceeds of a small home she had been making payments on in upstate New York for 20 years.

She said this amounted to most of her life savings. She never received the log cabin, and now fears she’ll never get the money back.

She is not alone.

Lagace is among more than 25 people who have filed formal complaints with N.C. Attorney General’s office against the Battleboro-based AmerLink. The complaints have been forwarded to the U.S. Bankruptcy Court in Wilson, where the company has filed for Chapter 11 bankruptcy protection.

Chapter 11 is a form of bankruptcy that involves reorganization.

Legace said she has spent many sleepless nights recently. She’s even having trouble getting back $5,000 she invested as a down payment on eight acres of land she was planning to buy for the log cabin.

“Most of my net worth was in the house,” said Legace, a single woman who works in a bread factory. “I’m not a rich person. I do not make a lot of money. I’ve been crying for months. It’s very much taken a toll on me.

“Do you know what kind of stress I’ve gone through?”

Legace said after selling her home, she initially moved into an apartment while she waited for the log cabin to be built. After that appeared to be going nowhere, she bought a small house, and said she now is burdened with a large monthly mortgage payment she wasn’t planning on paying with the log cabin.

AmerLink President John Barth could not be reached for comment this week, nor could Raleigh attorney Stephani W. Humrickhouse who is representing the company in bankruptcy court.

In a written response to complaints filed with N.C. Attorney General Roy Cooper’s office, Humrickhouse states that AmerLink acknowledges that it owes a return of deposits made on homes, but the exact amounts have not been verified.

“However, at this time, due to its (AmerLink’s) financial situation and the general condition of the economy, the company is unable to fulfill those obligations,” she states. “The company is actively searching for investments so that it can resume operations and devise a plan for the repayment of its creditors. If it is not successful in securing investment or financing, the company will be forced to seek Chapter 7 bankruptcy.”

Chapter 7 would involve a liquidation of the company’s assets.

Legace said she can only hope to get some of her money back from the bankruptcy court proceedings. But she said she fears she won’t.

AmerLink Ltd., which at one time employed more than 100 at its local headquarters, closed its doors late last year.

On June 3, the company asked the U.S. Bankruptcy Court for the eastern district of the state for a 120-day time extension to file a reorganization plan.

The complaints filed with Cooper’s office have a common theme, noting that AmerLink sales people aggressively sought large down payments. And when the product wasn’t delivered, AmerLink officials could not be reached.

Several of those making the complaints said their investment drained their savings.

Robert Thompson of South Hill, Va., said that he has invested $116,695 in an AmerLink home with nothing to show for it. He said that he is in the Virginia Army National Guard and is a Gulf War veteran.

“I have spent half of my first year of marriage overseas, and I wanted to build a house for my wife and son,” he stated in a letter to Cooper’s office.

Brian Soerensen and Arlene Manson of Denmark write that they invested $70,483 of their savings on “what was going to be our dream home.”

“I now feel that AmerLink has cheated us, in fact I believe that from day one we were duped into paying up front, and the offer of the discount was just a ploy to get our cash,” they stated in a letter to Cooper.

In a letter to them from company president Barth, dated June 18, 2008, he congratulates them on buying the AmerLink log home.

“We are pleased that you have chosen to do business with us, and we are confident that our quality and professionalism will exceed your expectations,” Barth writes. “We look forward to watching your AmerLink package become the log home of your dreams.”