Dallas-based specialty construction firm Auzmet Architectural is shutting down operations and laying off more than 150 employees as its ownership structure collapses under bankruptcy proceedings and serious misconduct allegations tied to its former leadership.

The closure comes amid a legal battle involving the company’s private equity owner, Illinois Avenue Partners, which has filed for bankruptcy while simultaneously accusing its former executives of financial wrongdoing.

152 layoffs confirmed in WARN notice

In a WARN notice dated May 19, Auzmet informed Texas officials it would lay off 152 employees at its headquarters on 1444 North Cockrell Hill Road in Dallas.

Most workers were separated immediately, while a small group was retained temporarily to help wind down operations through mid-July, according to the notice.

The company specializes in designing and building custom building facades and has worked on several notable Dallas-area projects, including Ross Tower and other commercial developments. Its portfolio also includes ongoing work on major projects such as the under-construction Bank of America Tower at Parkside in Uptown Dallas, though the future of those projects remains uncertain.

Bankruptcy filing deepens collapse

On May 22, Auzmet and Illinois Avenue Partners, along with multiple affiliated entities, filed for Chapter 7 bankruptcy.

Court filings show the parent firm is facing severe financial distress, estimating less than $50,000 in assets against $10 million to $50 million in liabilities.

The bankruptcy comes after months of escalating legal disputes involving the firm’s leadership and financial operations.

Misconduct allegations at the center of legal dispute

Illinois Avenue Partners has sued its former founders, Richard Gifford and Michael Winton, alleging a wide-ranging scheme of financial misconduct, including:

• Manipulation of financial records
• Early or inflated revenue recognition
• Concealment of liabilities and financial shortfalls
• Self-dealing and improper compensation practices

The lawsuit, filed in Delaware Chancery Court, claims the executives misrepresented the financial health of portfolio companies while securing additional investments and debt financing.

According to the complaint, adjusted financial results showed that what was presented as a $5.5 million EBITDA profit in 2024 was actually a significant loss after corrections.

The suit also alleges the founders used inflated performance figures to justify higher salaries and bonuses.

Internal turmoil and leadership shakeups

The complaint further describes internal breakdowns in governance, including claims that leadership changes were made without board approval and that oversight concerns were ignored or concealed.

Whistleblowers reportedly raised concerns that eventually contributed to a broader internal investigation. Following that review, Gifford and Winton were removed from leadership roles in 2025 and later terminated for cause in August, according to court documents.

The lawsuit also references allegations involving employment decisions and workplace conduct, though those claims remain contested in court filings.

Gifford and Winton have denied wrongdoing, filing motions to dismiss the case and countersuing for indemnification, arguing they were improperly removed and not paid what they were owed.

Impact on projects and workforce uncertainty

Auzmet’s collapse leaves uncertainty across multiple construction projects in Dallas and beyond, particularly those involving complex architectural facade work.

While some projects are already underway, it remains unclear how they will proceed without the company’s involvement.

Industry response and employee fallout

Former Auzmet CEO Jesse Ross stepped down in April and later acknowledged the layoffs in a social media statement, expressing concern for displaced employees and noting efforts to help workers find new jobs.

He said he had been focused on supporting affected staff and credited parts of the broader professional community for assisting laid-off workers in transitioning to new roles.

Legal representatives for Illinois Avenue Partners and the former executives either declined to comment or did not respond to requests.