A Lawrence resident no longer is on the hook for a potential $300 million payment that had been sought by creditors in Farmland Industries’ massive bankruptcy case.

A lawsuit brought against Bob Honse, former chief executive officer of Farmland, has been dismissed by U.S. Bankruptcy Judge Jerry Venters. The case, filed early this year by J.P. Morgan Chase, had accused Honse and 28 other Farmland executives and directors of negligence and other problems that led the co-op to seek bankruptcy protection in 2002.

The suit sought payment of more than $300 million, which would have been distributed to some 60,000 unsecured creditors. Many of the creditors are farmers, including dozens in Douglas County.

On Thursday, Honse said through a representative that he felt vindicated by the judge’s dismissal of the suit, which came Nov. 16 and becomes effective next Thursday, when plaintiffs’ 30-day window to appeal expires.

“He’s pleased,” said Honse’s attorney, Cal Karlin. “It does mean that it’s over, and that Mr. Honse can move on to being a deacon at St. Margaret’s Church.”

The dismissal also means that Honse and others soon will dismiss a related case of their own. Honse and other accused executives and directors had filed suit against three insurance companies that had refused to pay for their legal defense.

Now that the negligence case has been dismissed, and J.P. Morgan had been ordered to advance payments on legal fees for Honse and others, the case will be dismissed by agreement later this month, Karlin said.

The bankruptcy case ended up revealing that a Farmland decision at the heart of the case – to build a fertilizer plant in Coffeyville for more than $300 million, piling up what J.P. Morgan called “catastrophic” debt – actually is worth plenty of money now, Karlin said. And unsecured creditors are receiving the money they’re owed.

Unsecured creditors will be receiving payments Dec. 16 to cover interest the Kansas City, Mo.-based cooperative owed them, he said.

“This is a very unusual bankruptcy,” Karlin said. “Normally you get 5 to 10 cents on the dollar, at best. And here, all the unsecured creditors are getting 100 cents on the dollar, plus interest.”

Farmland at one time was the largest farmer-owned cooperative in North America. Its holdings included a nitrogen fertilizer plant at the southeastern edge of Lawrence, property now being sought by Lawrence and Douglas County officials for development of a business park.