About the Lawsuit Against VarTec Telecom (Joe and Connie Mitchell of 10xxx Glen Rose)


 

About the Lawsuit Against VarTec Telecom (Joe and Connie Mitchell of 10xxx Glen Rose)
 


9 August 2009 at 8:08:47 AM
salon

Noticed an update in Dallas Business Journal regarding a lawsuit filed against Joe and Connie Mitchell in 2006.A couple of the complaints by trustee Mims then were:

According to Mims' complaint against the Mitchells, the husband and wife paid themselves more than $30 million over the final three years before the business went into bankruptcy, and also received about $10 million in benefits by helping engineer the acquisitions by Dallas-based VarTec of two businesses in which the Mitchells had ownership stakes.

In addition, Mims' complaint says, the pair also acquired, through a series of complicated transactions, a 7,200-acre ranch in Glen Rose owned by VarTec known as the 10XXX Ranch.

The article goes on to explain that the ranch, named after the 10-10 dial around system (remember all those commercials on teevee?) was valued between 10.4 to 13.4 million. When it was transferred to the Mitchells, Vartec redeemed two percent of its stock from a shareholder, who ended up owning the ranch and selling it to the Miitchells for 9.5 million. Then, the Mitchells leased it to a VarTec unit for 100,000 per month.

In 2005, VarTec reorganized under bankruptcy. Why?

Founded in 1989 by Joe and Connie Mitchell, along with their friend Ray Atkinson, VarTec helped pioneer the dial-around longdistance business - allowing customers to get discounted longdistance rates on calls by dialing 10-10 plus an access code. But the popularity of cell phones and steep decline in long-distance rates has hammered margins and wounded the dial-around business. Another setback: Hoover says Joe Mitchell told him people were not opening direct mail - a primary means of solicitation for VarTec's services - following the Sept. 11, 2001 attacks and subsequent anthrax mailings that created a nationwide scare.

Interesting article in which the banks were said to be part of Vartec's failure-BECAUSE THEY SET RESTRICTIONS! About the merger between VarTec and Lightyear

Who is to blame for the merger falling apart? The banks, say sources. They wanted to play hard ball with VarTec, imposing rigid restrictions on the debt the company would assume on behalf of Lightyear, according to one source, "They wanted to put a lot of restrictions on it and Joe [Mitchell Jr., VarTec chairman] doesn't need restrictions," the insider told PHONE+.

In 2007, United States Bankruptcy Judge said, in Case No 04-81694-HDH-7 that

This Court recognizes that extending officers’ and directors’ duties to creditors when a corporation nears insolvency creates many issues for such officers and directors and the professionals providing them advice. However, this case revolves not around what the law should be, but what the law is. Both Texas and Delaware law recognize a cause of action for breach of fiduciary duty against the directors or officers of a corporation may be brought by the creditors of a corporation when the corporation is either insolvent or in the "zone" or "vicinity of insolvency" which is what the Trustee has pled in this case. Accordingly, Defendant’s Motion to Dismiss is hereby

 Mitchells are seeking an end to the lawsuit.


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Comments!  
1 - anonymous   10 Aug 2009 @ 6:18:21 PM 

Joe and Connie steal the complicated way, young Jamie just breaks and enters.  Is this a family pattern?  The Mitchells probably are shelling more out for lawyers right now than the rest of us will earn over several years.    



2 - Bill   15 Apr 2010 @ 7:39:01 PM 

Vartec Communications and Joe and Connie Mitchell bring shame and dishonor to the words 'integrity', 'honor', and 'righteousness'

This company milked my elderly parents for thousands of dollars before they knew they were being duped.

One thing that gives me great comfort is knowing there is a hell for people like Joe and Connie Mitchell and when they die, they may go there.

Amen?



3 - humanbeing   15 Apr 2010 @ 9:49:12 PM 

My major complaint is against their ranch and he so-called game fences (12 feet high) that are a perversion and should be declared illegal for all properties except real wildlife preserves like Fossil Rim.


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4 - salon   16 Apr 2010 @ 9:17:14 AM 

@Bill-I'm sorry about what happened to your parents. Wonder, how did they finally realize?


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5 - John   21 May 2010 @ 1:16:17 AM 

Joe and Connie are great people who care about their friends and family. The people who want to criticize them are simply jealous of their accomplishments in life.



6 - I worked for them   2 Aug 2010 @ 11:18:37 AM 

Joe and Connie started out as caring people.  I worked for them nearly seven years.  They went to church, spent time with their 5 kids (Brooke, Bret, Brady, Joey and Jaime), and always had kind words to say to us all.  As their wealth grew and they changed.  Nannies and Au Pers took over the parenting roles,  when they went thru enough of them  employees at the Offices and ranch became the caretakers of the kids.  As Joe gained wealth and power his whole outlook changed. I once heard him say, "I'm not greedy, I just want whats mine, and everything that touches it."  Greed and power took over these once caring Christian people.  At a convention for one of the companies that Var_Tec bought,  this same man stood up in front of tens of thousands of people and exclaimed "Here, I am God!".  Anyone who crossed him or refused to do his bidding because it was illegal or just plain wrong no longer had a job.  That's how I lost my job. I refused to forge signatures or lie for him and Connie about  illegal activity.  And the ranch? For years he and his good buddy Ronnie Bowles  smuggled deer across the Okahoma state line.  I could go on and on but I won't.  John, I don't know you, and YOU obviously don't know Joe and Connie.  Look deeper, what's on the surface is NOTHING compared to what lies beneath.  They will be your friend as long as you have what they want or need; when you no longer have it then they will no longer be your friend.  Been there, done that.  Power corrupts and absolute power corrupts absolutely. 



7 - Anonymous   2 Aug 2010 @ 11:32:16 AM 

I don't know you, John but I worked for the Mitchells for seven years. Sure, they started out as great people who cared, but the wealth and power went to their heads.  They forgot the meaning of integrity.  I lost my job when I refused to forge signatures or lie on paperwork .  Embezzlement,  smuggling deer across state lines,  you name it, I witnessed it.  They say power corrupts and absolute power corrupts absolutely.   They quite literally stole the ranch.   You can't take it with you though. One day  Joe and  Connie will stand before God and be judged.  All the money, power,  all the material things they though were so important won't save them.  I hope and pray they get saved  before that day comes.

  A young rich man once asks Christ how to get to Heaven, Jesus said that he must obey all Gods laws. The young man said he'd done that since he was a boy.  Jesus said he had to sell all his possessions and give all the money to the poor.  The young man walked away in disbelief.

   That story reminds me of Joe and Connie.   Wealth and power are more important to them than anything else.   As far as their accomplishments, I'm not jealous of anything they have or  have done.  I have neither riches nor great power.  I DO have my God and my family. I need NOTHING else.   God had given me all that I need and want.



8 - James Woods   28 Sep 2010 @ 2:10:46 AM  All can judge without truly knowing. Hmm lets look at the so called facts that have been stated thus far from 1 to 7. 1) Joe and Connie / Jamie Stealing? Show one court docket where any were proven guilty, because I too know them personally and none were convicted of anything, all dismissed. 2) Milking your elderly grandparents? All this shows is that your parents were not business savy enough to understand long distance communication rates, because thats con of those things you have to dial to pay. 3)12ft fence? How about you spend your money to raise quality deer and then let your neighbor reap the benefits of shooting it. Enough Said? 4)How did they finally realize? That after they stopped dialing long distance numbers their bill went down 5)Caring People. I completely agree with you John and I too have worked for the family for more than 18 years now and I still completely agree with you. 6)Smuggling below the surface? Ronnie Bowles was more than qualified, not to mention certified, to do this so called "DEER SMUGGLING". since you seemed to know this family and their friends so well i would assume you wouldn't be shocked to know in texas you need paperwork for every AI deer used, and also that a licensed vet has to be present. Smooth talking though. 7)EmbeZZlement and Jesus? Im glad to know you can cast the first stone, and like you said there is a special place in hell for those who don't follow the Bible. Im glad you have your family and your god and need nothing else, but for the rest of society a good job that provides for you doesn't hurt either. But churches never ask for donations either. How about you throw some money into the offering plate for once, because Joe and Connie sure have. Actually why don't you throw your financial statements up on this nice page and we will see if your lifetime earnings have even come close to what they have donated to your community. To whomever knows the Mitchell's best please don't be afraid to correct me if you feel you can produce better evidence, and also don't be afraid to add your name. Thank you and Good Night

9 - marilyn greathouse   30 Dec 2010 @ 1:51:32 PM 

I FEEL STUPID, THEY ADOPTED MY SON BRETT , IF I KNEW NOW ABOUT HOW THEY REALLY ARE I WOULD NEVER LET JOE AND CONNIE ADOPT MY SON. I WILLL  NEVER FORGIVE MY SELF.  I WISH I COULD TAKE BACK TIME AND NEVER MEET THE THEM. MAY GOD FORGIVE ME.. 



10 - Lutheran Friend   3 Jan 2011 @ 10:12:44 PM 

M.G.

I am on old friend.    You have nothing to be ashamed of in regards to a decision made long ago.  You lovingly made the best decision you could given your age.  My personal opinion is that you spend too much time on nasty blogs and stalking others.  Carry your own cross and make your piece with God.  Only then will you stop judging others.  

By the way, the son you gave up turned into a wonderful young man.  

Sending prayers your way and hoping you find your way to a good minister to share your regrets with.



11 - m.g.   6 Jan 2011 @ 7:01:59 PM 

FIRST OF ALL DONT JUDGE ME, I DONT DO BLOGS AND NEVER STALKING  OTHERS, FOR YOUR  INFO , AN EMPLOYEE  ADVISED ME THAT HE USE TO WORK FOR  VAR-TEC AND SHOWED THIS ARTICLE TO ME.  YOU DONT HAVE TO PRAY FOR ME BECAUSE I DO THAT EVER NIGHT AND I HAVE A GREAT LIFE.. REMEMBER YOU NEED STOP JUDGING ME AND SAY A PRAY FOR YOURSELF. IM A GOOD PERSON.  I MAY HAVE  CHOSEN THE WRONG COUPLE, THATS ALL. 



12 - I worked there too   27 Jan 2011 @ 11:35:28 PM 

I worked there too. One thing that bothered me was their decision to hold the last Excelabration event knowing they were going to file bancruptcy. They were taking those peoples money and in some cases more. A group of young people were driving in a van that crashed on their way to Dallas for the event. I know at least 2 died. Makes me wonder how they sleep knowing their greed cost 2 young people their lives.



13 - X VarTec VP   7 Jun 2011 @ 12:34:45 PM 

I not only worked there, I was in senior management in the early days. Although I always thought that Joe was an honest person in the sense that he was too shrewd be caught in an outright lie, he natually looked out for himself, as many Alpha executives do. Is he sociopathic? No, I don't think so. Is he unwise? Yes, in some ways without doubt. Although he is good with numbers, he often made poor business decisions because he is not an astute visionary of market dynamics. He fancied himself a business maverick probably due to the early influence on his career of Clayton Williams. However, Joe is a lousy gambler and he made business acquisition choices based upon his personal gut decisions. Often they were simply way off target, because as much as he likes to believe otherwise, he is just not in sync with most of the rest of the world, and that makes him a lousy judge of marketing strategies and business trends based upon social dynamics. In fact, Joe did not pioneer the dial around concept for long distance. I know because I brought him the idea about a year before VarTec actually adopted it and he didn't believe in the concept until it was proven viable in a marketing test we first ran in Tyler, TX. After that it was an all out growth fest. Although Joe made one lousy business decision after another, often against the advice of anyone with enough guts to stand up to him (there were only a couple of us back then), they were never fatal because the dial around business was a veritable cash printing machine. However, once that golden goose went infertile, his bad business decisions couldn't be covered up by expanding cash flow any longer. Besides his lack of marketing vision, Joe's downfall is without question, Connie. When she couldn't get her way she would (yes, I know this is high school behavior) threaten to withold her feminine charms and he would instantly cave in to her whims. Connie, on the other hand is a bone fide narcissist in the classic sense. She is socially crude and has a mean streak coated with vindictiveness hidden behind an ever present smile. If you want to see proof of her legacy, just look at the miriad of consumer complaints against the company posted all over the internet that were chronically unresolved - Connie was VP of Customer Relations. Did they pay for personal expenses wherever possible out of company funds. Yes, but in the early days I saw no real substantive abuse. However, if they had been employed by a government entity their abuses might have received some unwanted scrutiny, because I don't think birthday gifts for friends, hair sylist visits, nail salon treatments, etc., etc., etc. are considered legitimate business expenses in more controlled environments. But, Joe is smart, and whatever he took from VarTec he took in an amount that was calculated to be within his legal wiggle room limit regardless of how grey the rest of the world might view his actions. He would have looked at precedents for compensation and built his case before he commited the act. That is why he is still walking the streets, or his acres as it were and not staring at concrete walls. What I don't understand is how two people who only owned 10% of the company were able to pull out so much cash while the other folks who owned the remaining 90% stood numbly by.  I know several employee shareholders. Although I don't know this for sure, when the company went bankrupt I doubt if they saw anything for their trouble.  Joe got away with what many of us would consider to be amoral if not immoral acts and I guarantee you he won't lose one minute of sleep over it, unless Connie tells him to.



14 - salon   7 Jun 2011 @ 12:48:37 PM 

Vp-do you happen to know if the lawsuit above was ever resolved one way or the other?


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15 - X VarTec VP   7 Jun 2011 @ 3:18:42 PM 

No, I don't know the current status of the lawsuit, but it would appear to still be active.  Although I am not an attorney, from what I can glean from the course of this suit it would not surprise me if it eventually just goes away.  I have noticed that the trustee who brought the suit has whittled down the points to just a couple.  The kinds of issues brought in the suit would seem difficult to prove because the charges seem to stem more from what was reasonable compensation under the circumstances and that will carry a broad range of interpretations and depends upon a judge's perspective more than hard legal doctrine.  Anecdotal information such as I am willing to provide simply illustrates that although some type of moral judgement seems applicable here, legal judgement is another measure entirely.  I am sure that the initiator of this cause was outraged by Joe and Connie's behavior and wants justice served, but probably about the best anyone can hope for is that decent people will snub them at the grocery store.



16 - Jewel Haul   29 Feb 2016 @ 3:21:58 PM 

Im sorry to say but both Joe and Connie Mitchell only look out for themselves just like the Garys and other VPs that were once Vartecs leadership.

They didnt give a crap about  the employees they laid off (Memorial day massacre) do to their own selfishness. They took a gamble to only make them selves richer and when it didn't pan out it was their devoted employees that got the shaft. Yes, I remember Connie  supposedly a director/VP of HR monitoring when people came in for summer hours. Yep what a nice job to be making 6 figures to just stand by the elevator bank and mark what time people came in. Talk about creating something for a person to do...

Absolutely unprofessional and child like. 

I find comfort in Karma being real and it will come back and get them sooner or later and they will deseve exactly what they get. Selfishness never pays in the end, sadly they run around pretending to be nice people but there has always be aspecial place in the after life for people like them. 



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