Cypress Creek EMS files for bankruptcy

Troubled ambulance service to liquidate assets

CYPRESS CREEK – A beleaguered ambulance service that serves about 600,000 people in north Harris County appears to be on life support after reaching an agreement with Emergency Services District 11.

Cypress Creek EMS has been the subject of multiple investigations by both KPRC2 Investigates and law enforcement.

In 2019, KPRC2 Investigates went undercover to reveal a scheme that lined the pockets of certain employees. These were employees that were paid through public funds. Nobody has been criminally charged in connection with the scheme, to date.

Now, a mediated agreement between ESD 11 and Cypress Creek EMS has netted a windfall for the Emergency Services District. Among the concessions, according to a bankruptcy court filing:

  • A) ESD11 is paid $413,500 in cash ($350,000 from Travelers Casualty and Surety Company of America (CCEMS’s D&O insurer), $50,000 from Koronis, an aggregate of $13,500 from the current/former director and officer third-party defendants (other than Bradley England)
  • B) Debtor turns over the ESD11 distributions from the FEMA receivable of approximately $380,000 described in docket number 77 (the ultimate payment amount will be determined by FEMA and the State of Texas)
  • C) ESD11 will receive an allowed, unsecured claim of $2,500,000.00
  • D) The Debtor agrees to promptly draft, file and pursue a plan of liquidation to exit the bankruptcy case
  • E) The mediating parties (not including Travelers) will support Debtor’s plan of liquidation so long as it comports with the settlement by no later than May 13, 2022 (and Travelers will not oppose)
  • F) All proofs of claim filed in this bankruptcy case by the current and former directors and officers of the Debtor (i.e., the third-party defendants) shall be deemed withdrawn and they shall receive no distribution in this bankruptcy case. Those parties will not file any other proofs of claim in this bankruptcy case
  • G) The Debtor shall file a motion seeking approval of the settlement no later than April 29, 2022, and seek expedited consideration

Cypress Creek EMS’ former public relations liaison, Miranda Sevcik, pointed KPRC2 Investigates to this statement, contained within a bankruptcy court document when asked for a response to coverage of the mediation agreement:

“The Parties expressly acknowledge, agree, and understand that this Agreement constitutes a compromise and settlement of disputed claims, including the avoidance of cost, fees, and expenses associated with such disputed claims, and that no aspect or provision of this Agreement shall be construed to be a legal or factual admission or confession by any of the parties of any fault, contractual or extracontractual obligation, or of any moral, legal, or financial liability. Neither the Agreement, its execution, the performance of any of its terms, nor any of its contents shall constitute offered in evidence as an admission of liability, or insurance coverage, or any factor indication that any claims at issue in the litigation have merit.”