LEXINGTON, Ky. (LEX 18) — Lexington Blue, a roofing company that has come under fire for allegedly taking payments from customers and failing to complete contracted work, has filed for Chapter 11 bankruptcy.
Owner and CEO Brad Pagel filed the case in the United States Bankruptcy Court for the Eastern District of Kentucky on Tuesday. Pagel provides a timeline of the business and its operations in the declaration of support of Chapter 11 bankruptcy filed in the court.
In 2021, the document states, the company had completed over 7,500 projects, but later that year began relying on "a series of high-interest MCA loans, initiating a cycle of aggressive repayment that quickly depleted the company's cash flow."
In 2023, a combination of failures in backend collections and oversight, and a switch in banks that triggered "account freezes, check holds and cascading operation failures," resulted in the company "struggling" to pay back vendors and subcontractors.
According to the document, vendors in 2024 suspended credit, demanding repayment in full. In August of that year, a Cincinnati branch member also "secretly formed a competing roofing company using LB staff and resources" and that location soon closed.
Customer complaints and requests for refunds "overwhelmed customer service operations" in 2025, and layoffs began in February. By April, the company officially announced a closure.
Over the past few months, LEX 18 has spoken with some of those customers. Many say that they paid for jobs that were never completed.
Monday's filing from Pagel states that the company owes more than $3 million to former customers and employees, among other groups. The filing lists less that $50,000 in assess, and a a number of creditors ranging between 200 and 999.
Customers in Lexington, Louisville, Frankfort, Nicholasville, Paris, Richmond, and Versailles, and some in Ohio, are still owed.
Pagel is also being sued by Kentucky Attorney General Russell Coleman. Last month, his office obtained a court order to freeze Pagel's assets.
Under Chapter 11 Bankruptcy protection, the company could later reorganize and continue operating.
