Attorney General's News Release

December 2, 2004

Attorney General Nixon sues former Iron County business for failure to repay state loan, create jobs

Jefferson City, Mo. —Attorney General Jay Nixon has filed suit against the president of a now-defunct paper products company in Iron County for failure to repay a $100,000 loan and reneging on the promise to create and maintain 75 new jobs.

The suit was filed today in Jackson County Circuit Court against Frederick R. Law of Tampa, Fla., former president of Ozark Paper Products of Des Arc, Mo. In 2001, Law guaranteed a Community Development Block Grant loan from the Missouri Department of Economic Development (DED) for Ozark Paper Products in the amount of $100,000. The conditions of the loan were that it be repaid with interest, and that the company create 75 jobs and maintain them for five years.

Ozark Paper defaulted on the loan in August of 2002 when it shut its doors and refused to repay the loan.

"Missouri has always been cooperative and willing to support entrepreneurial enterprises, but for this system to work, businesses have to hold up their end of the bargain," Nixon said. "This is a case where the business failed to do so."

Nixon is seeking repayment of the loan plus interest and penalties, for a total of $169,142.42. He is also asking for reimbursement for attorney's fees, court costs, and other expenses incurred by the state.

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to Press Secretary John Fougere.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818