Isom, who owns Old Richmond Exteriors, is accused of failing to complete home renovation projects customers paid him to do.
The lawsuit, filed in Chesterfield County, seeks full restitution for those customers. It also calls for Isom to pay for the state's investigation and legal fees.
"We will not tolerate contractors who take advantage of consumers by charging down payments or progress payments while misrepresenting their services or not completing the work," Cuccinelli said in a statement. "My office remains committed to protecting Virginia consumers from such deceptive practices."
Isom told CBS 6 the bad economy ruined his business. He said he has already repaid seven of the 10 customers.
"I am trying to get these customers paid off. I don't know who is included in this right now but it could be some of the customers that I have already repaid. I'm not hiding. I'm not running. I am going to continue to pay each customer back," Isom said during a phone interview Wednesday afternoon.