Cedar Rapids Clarion Hotel settles wage issue while another lawsuit looms

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CEDAR RAPIDS, IA (KCRG-TV9) -- Employees at the former Clarion Hotel in Cedar Rapids located at 525 33rd Ave. Southwest will get more than $129,000 in back pay.

That's part of a settlement with the US Department of Labor. KCRG-TV9 reported in December that hotel employees had not received pay for weeks just ahead of Christmas.

Now the man who was running the hotel at the time is facing a lawsuit. Hassan Hussain is being sued by the owners of the hotel. The Kalra family says they invested $1.5 million into the hotel last year. $500,000 of that was for hotel operations, which they say Hussain misspent.

The Kalra is being represented by Peter Riley of Tom Riley Law Firm in Cedar Rapids. He says Hussain wrote a letter to them apologizing for misappropriating the money, and that he was going to pay it back in 30 days. Riley says that never happened.

He says, “When the 30-45 days came up in late January, Hussain, took the computers and the records and left. So the Kalras have been running it (Clarion Hotel) ever since.”

The Kalra family will be running it under a different name soon. Choice Hotels told them they couldn't use the Clarion name anymore, so starting this weekend, the hotel will start running as a Ramada. Riley says customers should be comfortable with them running the show.

He says, “The Kalra's have a track record. They're not the ones engaged in any wrong doing."

Hussain's company is based out of Virginia where court records show he pleaded guilty to felony forgery and false pretenses charges in 2012.

I reached out to Hussain, and he tells me they have a settlement reached, but Riley says they don't have an agreement.