HELENA, Mont. — The founder of a Montana mountain resort for the ultra-rich is due in federal court Monday where a judge will determine if he remains in contempt over a Mexico property sale that landed him briefly in jail.
Former billionaire Tim Blixseth of Washington state was ordered to appear before U.S. District Judge Sam Haddon in Helena.
Haddon jailed Blixseth for contempt in December for failing to fully disclose what happened to $13.8 million dollars from a property sale in the Mexican state of Jalisco. Blixseth was freed after seven days by an appeals court, and he’s since filed thousands of pages of financial records that he says show how the money has been spent.
His attorneys said he has “substantially complied” and the contempt matter should be ended.
But his creditors have suggested Blixseth tried to hide the sale proceeds along with other money he took from Montana’s Yellowstone Club resort. The trustee for the creditors’ Yellowstone Club Liquidating Trust said Blixseth spent the money on “purely personal expenses” to support his family’s lavish lifestyle.
That includes $2 million spent by Blixseth on his 156-foot yacht and 58-foot fishing boat; nearly $42,000 a month for his wife’s personal expenses; trips to Athens, Rome, Paris, Nice and Istanbul with members of his family; $2,000 for massages and $21,000 for wine, according to trustee Brian Glasser.
The Yellowstone Club, a private ski and golf club near Big Sky, went bankrupt right after Blixseth turned it over to his ex-wife in 2008.
It’s been under new ownership since 2009. A legal fight has dragged on over Blixseth’s fraudulent transfers of money while he was in control of the club.
Blixeth and his former wife misappropriated more than $270 million from a 2005 Credit Suisse loan to the club, according to tax authorities and his legal adversaries.
Montana revenue officials say he owes almost $74 million in back taxes, penalties and interest in the state, after a diverting the money from the club to buy luxury cars, jets and high-priced properties in Mexico, Scotland and elsewhere.
Blixseth also has judgments against him for more than $240 million from the liquidating trust.
Blixseth has denied wrongdoing and fought the allegations at every turn.
In a separate case attorneys for the estate of Edra Blixseth are challenging the settlement agreement reached between Edra and Tim Blixseth that divided their assets when they divorced.
A Tuesday hearing is scheduled before Haddon to decide if the agreement should be declared void.
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