"In court papers, Marc S. Kirschner accuses Blixseth of siphoning off $209 million of a $375 million loan that Credit Suisse made to the club in 2005. The funds were put toward Blixseth’s personal benefit, Kirschner alleged, which “doomed” the club to insolvency.
The following year, Kirschner said Blixseth took more of the loan proceeds, to the tune of $80 million, when Blixseth allegedly used the cash to buy property for the benefit of third parties under his control. Kirschner is seeking to recoup $286.4 million (plus interest and attorneys’ fees) under a provision of bankruptcy law that allows a company in bankruptcy to take back payments it made while insolvent or with the intent to keep creditors away from the funds.
“The truth of the matter is that Blixseth walked away from the debtors after receiving the benefit of hundreds of millions of dollars, and the debtors received nothing in return, except enormous liens against their property and an obligation to repay a loan that was never meant for their benefit in the first place,” Kirschner’s lawyers wrote. “Blixseth cannot just walk away this time; rather, he must be held accountable for his actions.”
Blixseth, on the other hand, denies the allegations against him. He said he acted in good faith, used sound business judgment and disputes that his actions caused the Yellowstone Club’s financial woes. (The club filed for Chapter 11 Protection in 2008 under the weight of a heavy debt load; it was purchased out of bankruptcy last summer.)"
Source of Marc S. Kirschner
http://blogs.wsj.com/bankruptcy/2010/02/24/trustee-says-blixseth-doomed-yellowstone-club/
http://blogs.wsj.com/bankruptcy/2010/02/24/trustee-says-blixseth-doomed-yellowstone-club/
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