The U.S. Bankruptcy Court (Middle District) in Fort Myers, Florida, scheduled an emergency hearing for the bankruptcy filing by MDG Capital Corp., a Naples, Florida, company. MDG specializes in commercial and residential construction. According to Pat McCuan, a principal of MDG, there are actually five filings, and one of them is a civil lawsuit against Regions Bank and its subsidiary, Morgan Keegan & Co. Inc., for $30 million.
McCuan alleges that Regions didn’t come through with the committed funding for Fountain Lakes, which was never built. MDG built two other properties financed by Regions: Arrowhead Reserve at Lake Trafford in Immokalee and The Promenade West in Fort Myers. MDG claims there was a “chain reaction” that caused default on the payments on these properties when it didn’t get the commitment on Fountain Lakes. Also, Regions filed foreclosures on those financed and built properties. MDG also built TIB financial center in Naples, which the bankruptcy filing includes.