The 9th Circuit Court of Appeals is reviewing the reappointment of Montana’s federal bankruptcy judge after his appointment expired November 17th. In the meantime, the 9th Circuit has extended Judge Ralph Kirscher’s appointment for 6 more months.
I spoke with David Madden, the public affairs officer for the 9th Circuit Court of Appeals. He told me that he was not privy to the reappoinment process, but says that these types of extensions have happened in the past.
The Sacramento Bee is reporting on a potential bombshell out of California. The Sac Bee is citing public evidence that the federal Bankruptcy Court Judge in Montana may have violated ethics rules, awarding $22 million to his old law firm in Missoula, among other allegations. The Sac Bee quotes a Stanford University ethics scholar, saying, if the complaint is true, it would expose “a flagrant violation of judicial procedure.”
The complaint comes from Yellowstone Club co-founder Tim Blixseth
Now the club’s co-founder, Timothy Blixseth, has accused federal bankruptcy judge Ralph B. Kirscher of misconduct in his handling of lawsuits spawned by that bankruptcy. Blixseth alleges that Kirscher facilitated a below-market sale of the club to CrossHarbor’s benefit. He also accused the judge of improper communications with Blixseth’s legal adversaries.
The complaint to the 9th Circuit adds evidence, said to come from public records, that Kirscher recently maintained an email address at Worden Thane and served as the firm’s vice president, then awarded the firm’s clients $22 million.
Emails obtained by The Bee show correspondence about the Yellowstone Club case between Kirscher and Worden Thane partner Ronald A. Bender via that email address just prior to the bankruptcy settlement.
The Blixseth complaint also alleges that Kirscher maintained an improper relationship with Missoula law firm Worden Thane PC, where he formerly was a partner. The firm represents former minority shareholders in Yellowstone Club, who say that Blixseth owes them millions of dollars. Kirscher’s award of $22 million to that group has been appealed.
Oddly enough, you may recall that Blixseth was back in the news in the days leading up to the announcement by former Gov. Brian Schweitzer (D-MT) that he would not run for the US Senate in 2014.
After Blixseth won a key ruling in federal court down in Nevada, Mike Dennison filed this report for Lee Newspapers:
Blixseth also alleged that Schweitzer, Montana’s governor from 2005 to 2012, orchestrated the 2011 filing of the petition as a favor to the new owners of the Yellowstone Club. If the petition had succeeded and forced him into bankruptcy, his counter-lawsuits against the Yellowstone Club owners and Credit Suisse would be blocked until the bankruptcy was settled, he said.
Schweitzer had a close relationship with the new club owners because in 2007 they had donated large sums to the Democratic Governors Association, which Schweitzer chaired and which later transferred funds to the Montana Democratic Party to help Schweitzer’s 2008 re-election, Blixseth alleged.
You may also recall that Fox Business Network initially broke the news on a so-called “dark money” political group with ties to former Governor Schweitzer. The funds were also tied to Schweitzer’s role within the Democratic Governor’s association.