Paul Hathaway, the dealer of manufactured and modular homes and the former owner of Hathaway Homes Group, has reached a settlement with the Idaho Attorney General’s office.
The agreement, which follows a consumer protection lawsuit against Hathaway, will prohibit Hathaway from advertising or selling manufactured homes to Idaho consumers and from within Idaho.
The consumer protection complaint alleged Hathaway and his business engaged in a “pattern or practice of unfair or deceptive acts or practices,” including misleading responsible consumers, contradictory representations, wrongfully permitted liens and failure to deliver on promises to consumers.
The settlement was signed March 29 and filed for court approval Tuesday. The prohibitions will go into effect May 1, once the agreement is approved by a judge.
“The financial and emotional toll Mr. Hathaway’s alleged fraudulent actions have had on consumers cannot be quantified,” Attorney General Lawarence Wasden said in a news release. “While the conclusion of this case does not restore what consumers lost, it is intended to prevent Mr. Hathaway from causing others similar harm in the future.”
Hathaway refused to comment Wednesday when reached by phone.
According to the settlement’s terms, Hathaway will be prohibited from: “advertising or selling new or used manufactured homes to Idaho consumers or misrepresenting his authorization to do so” and “advertising or selling new or used manufactured homes from within Idaho, unless he’s properly licensed and works under a state-licensed business entity.”
He will be able to apply to have the restrictions lifted after five years. If he violates the terms of the agreement, he can be subject to fines of up to $10,000 per violation as well as other legal sanctions.
Hathaway will still be allowed to transport, repair and install new or used modular or mobile homes both within Idaho and in other states. He can also rent or lease mobile homes.
Last week, a district court judge ruled, by default judgment, that Hathaway Homes Group can never again do business in Idaho. Nobody appeared in court proceedings on behalf of the company. Hathaway was terminated from his position by a U.S. bankruptcy trustee, who took over the company when bankruptcy proceedings began last year.
Hathaway was set to go to trial in September before he reached a settlement with the Attorney General’s office.
More than a dozen former customers told the Post Register in recent years they were treated unfairly by Hathaway Homes Group. They said Hathaway cheated them in one way or another.
Hathaway Homes Group customers said they gave Hathaway large upfront down payments for homes that were never delivered, were different than the homes customers ordered or were delivered long after the promised date.
Some said they were left destitute and homeless after their dealings with Hathaway.
“(Hathaway’s) unfair, misleading and deceptive business practices caused consumers to lose hundreds of thousands of dollars, which consumers likely never will recover because of (Hathaway’s) bankruptcies,” the complaint said.
Hathaway Homes Group and All Terrain LLC (another company that Hathaway owned) and Hathaway himself are undergoing Chapter 7 bankruptcy liquidation.
Recent court documents show continued liquidation efforts. Wells Fargo moved to repossess Hathaway’s office in St. Anthony. And auctions are being held for property that Hathaway owned through his businesses.
The liquidations are attempting to repay the millions of dollars of debts that Hathaway owes to his former creditors, the largest of which (about $3.8 million) is owed to TAG Lending in Utah.
According to an April 2018 court disclosure document, creditors had unsecured claims against Hathaway and his businesses totaling more than $8.2 million.
Wasden’s office will monitor Hathaway’s future business activities. Anyone who observes Hathaway violating the settlement can file a complaint.