Kentucky Attorney General Investigates Lexington Blue Roofing Owners

Lexington, KY, September 27, 2025

News Summary

A Fayette County judge is deliberating on whether to unfreeze the finances of Brad and Courtney Pagel, owners of Lexington Blue Roofing, amid allegations of consumer fraud. The Attorney General’s office is pursuing legal action for over $2 million in unreturned customer deposits following the company’s abrupt closure. Testimonies reveal misuse of company funds, raising questions about the Pagels’ business practices. A creditors’ meeting is set to provide updates for the affected customers, with a ruling on the matter expected soon.

Lexington, KY – A Fayette County judge is currently considering a motion to unfreeze the finances of Brad and Courtney Pagel, the owners of Lexington Blue Roofing. This follows a consumer fraud investigation launched by the Kentucky Attorney General’s office, which requested the freezing of the Pagels’ bank accounts in June.

The hearing took place on September 22 and lasted three hours, although the Pagels did not attend. Their attorney, Adrienne Southworth, argued that their personal assets should not be subject to the state’s garnishing under the Kentucky Consumer Protection Act. However, the Attorney General’s office, represented by Gary W. Thompson, presented evidence alleging the misuse of company funds by the Pagels.

Lexington Blue Roofing closed abruptly in April, causing considerable distress among customers, as hundreds were left unpaid for completed roofing repairs. The Kentucky Attorney General’s office is suing the Pagels and their company for allegedly failing to return over $2 million in deposits owed to more than 262 customers. Following the company’s demise, Lexington Blue filed for Chapter 7 bankruptcy in June, transitioning into a liquidation case.

A creditors’ meeting is scheduled for September 29 at the federal bankruptcy court in Lexington, where affected customers will learn more about their rights and potential recovery of their losses. Southworth contends that the Attorney General’s actions are excessive and unfairly penalize the Pagels, while evidence presented indicates a history of financial misconduct.

A former employee testified that the Pagels often operated the business as if it were a personal piggy bank, using company resources for personal gain. Notably, Patricia Blankenship, the ex-employee, described instances where she was sent to fulfil personal cravings during Courtney Pagel’s pregnancy. The testimony raised questions about the ethics and business practices of the Pagels, prompting the Attorney General’s office to pursue legal action.

Further testimony revealed that the Pagels had received over $200,000 in COVID-19 relief loans, which were later forgiven. Additionally, the finance director for Lexington Blue, Nick Conway, testified that Courtney Pagel received a salary of $54,000 in 2024 with no recorded work. Not only was salary drawn from customer deposits, but the company also covered personal expenses for the Pagels, including their car payments. As a result, doubts have surfaced regarding the legitimacy of unfreezing their assets, especially since the Pagels reportedly hold less than $100,000 across their bank accounts.

Evidence presented during the hearing highlighted severe operational issues within the company. Employee paychecks reportedly bounced frequently, indicating longstanding financial troubles. A former customer commented on the injustice of the Pagels drawing a salary financed by unfulfilled roofing deposits, expressing belief that such actions border on criminality.

A ruling on the case is expected soon, as the judge continues deliberations on unfreezing the Pagels’ assets amid the ongoing fraud investigation.

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Additional Resources

• LEX18: Lexington-based roofing company shuts down amid investigation
• Kentucky.com: Latest news on Lexington Blue Roofing
• Fox 56 News: Homeowners scammed by Lexington roofing company
• WDRB: Former employee speaks out about roofing company
• Google Search: Consumer fraud Kentucky

Author: STAFF HERE LEXINGTON KY STAFF

The LEXINGTON STAFF WRITER represents the experienced team at HERELexingtonKY.com, your go-to source for actionable local news and information in Lexington, Fayette County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Woodland Art Fair, Crave Food and Music Festival, and Railbird Festival. Our coverage extends to key organizations like Commerce Lexington and Blue Grass Community Foundation, plus leading businesses in education, manufacturing, and technology that power the local economy such as University of Kentucky, Toyota Motor Manufacturing, and Lexmark. As part of the broader HERE network, including HEREBowlingGreen.com and HERELouisville.com, we provide comprehensive, credible insights into Kentucky's dynamic landscape.