Yellowstone Club Trial
The Case Against Edra Blixseth
Combined with recent court filings made by Edra Blixseth in her personal bankruptcy case, the evidence Monday painted a picture of a woman who, at a minimum, made some extraordinarily poor financial decisions.By Jonathan Weber , 5-04-09
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| Edra Blixseth outside the Missoula courthouse last week. Photo by Blaine Dunkley. | |
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As Tim Blixseth fights fraud allegations in the Yellowstone Club bankruptcy case, his preferred defense is one that will likely be familiar to any veteran of a bitter and contested divorce: it’s all his ex-wife’s fault.
Judge Ralph B. Kirscher has for the most part excluded evidence relating to the couple’s 2008 divorce from the trial now taking place in bankruptcy court over a $375 million Credit Suisse loan to the club.
But with Edra Blixseth on the witness stand Monday, Tim Blixseth’s attorney, Michael Flynn, finally managed to make at least part of his case against Edra. Combined with recent court filings made by Edra Blixseth in her personal bankruptcy case, the evidence Monday painted a picture of a woman who, at a minimum, made some extraordinarily poor financial decisions. And there is an argument to be made that she, and not Tim, is the one now responsible for paying back almost $200 million to the club.
A personal financial statement prepared just after the divorce settlement, introduced into evidence on Monday, shows a frightening list of liabilities - and assets that are pegged at values that are very high even in a pre-meltdown scenario. The financial statement shows debts of nearly $100 million. Her bankruptcy filing, which came about six months later, shows debts of $100 million to secured creditors and another $57 million to unsecured creditors.
The creditors include myriad banks and finance companies (almost $20 million to American Bank, $13 million to Western Capital, $8 million to Wachovia, and $7 million to Stockman’s Bank, for starters) as well as individuals (including $500,000 to Hollywood heavyweight Bert Sugarman), and numerous tax authorities ($7 million to the IRS, $2.5 million to the state of California, $1.5 million to the state of Montana, and smaller amounts to local tax authorities in Montana, California and Washington). She owes some $26.5 million on a legal settlement relating to Blxware, a software company, at least $3.5 million on a litigation settlement in the LeMond case, and of course she owes CrossHarbor Capital $35 million, which it loaned to her in August of 2008 to enable her to complete the divorce settlement.
Her assets are not trivial (and many serve as collateral for the above loans), but then again the values assigned to them back in August are, to put it mildly, optimistic. The Porcupine Creek estate near Palm Springs estate is pegged at $207 million - far more than it would likely have commanded in a sale even then, and probably several times more than it could be sold for now. The Yellowstone Club itself is valued at $500 million - exactly $500 million more than it was worth just a few months later. The 160-acre “family compound” at the club is listed at $40 million. There’s a $19.5 million receivable from her son’s defunct Story Mill development project. And the Chateau de Farcheville outside Paris is said to be worth $64 million.
This last item is critical, because Edra was counting on the sale of Farcheville at that price to pay back all sorts of debts and keep the Yellowstone Club afloat. But the sale fell through in September, and it’s now likely that Farcheville will be sold for something closer to $20 million.
In court testimony Monday, Edra acknowledged that she had agreed to take on responsibility for almost $200 million that was transferred from the Yellowstone Club to BGI, the holding company she had co-owned with her ex-husband, which in turn owns the Yellowstone Club. The club and the committee representing unsecured creditors contend that the transfer was a “distribution” that rendered the club insolvent. But Tim Blixseth (and Credit Suisse) say it was a legitimate loan, and that repayment remains the responsibilty of BGI (now owned by Edra).
The rest of the day Monday was spent on more expert witness testimony about whether the club could support a $375 million loan. The financial projections that Credit Suisse relied on matched Edra Blixseth in their, um, radical optimism; sales were projected to skyrocket just after the closing of the loan, with even things like the far-from-finished Warren Miller Lodge condos being counted on for serious revenue sooner rather than later.
Yet much of the case comes back to the question of whether the payments to BGI were legitimate loans, or simply dividends dressed up as loans. If they were the former, the club was not insolvent, there likely was no fraudulent transfer or breach of fiduciary duty, and Edra Blixseth could still be on the hook (though that won’t do the club much good, since it was Tim, not Edra, that emerged from the divorce with plenty of money). If the two-page, unsecured promissory notes are judged not to have been real loans, though, then it all looks very different, and Edra Blixseth at least won’t have to add that item to her long list of debts.
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Comments
http://www.clipsyndicate.com/video/play/933375
OOOOOOH. Looks like Mr. Byrne and Edra have some explaining to do.
Its a brokten record! Tim is not blaming his Ex-Wife, as you wrote, she LOOTED BGI, allowed Cross Harbor to 'Steal' Porcupine Creek for 35,000,000 and SB has controlled the entire process of the BK. He controls the UCC, he controls the Debtors (Edra) and has the DIP LOAN. Wake UP. She lied under oath, filed false personal BK statements and you still do not get it? She was on the stand today shaking as she is caught in her own lies which are a matter of court record. This is not made up, you were there correct? Give us all a break, she is not the Victim! She has a lot to answer for in regards to the 157,000,000 in money she spent in the last year. She took advantage of friends like the Sugarmans, family members (her own son Mr. Crocker) and banks with false financial statements which were part of this case How can you honestly continue to blame CS and TB? SB and EB need to be called to justice. If you truly are a good reporter why don't you start writing the facts. Its very clear but this BLAME the bank game and BlAME the TB game is a getting very old.
YC Members, wake up! Rally behind that Great Member we all know and like. Buy this Club YC Members and offer SB a loan of 15,000,000 for 10 days with Sunrise Ridge as security. Give the real LOOTER a taste of good old Montana Justice.
Tim gave Edra a debt free house called PC. This was inside BGI worth 207m. Edra signed for the BGI notes of 209m, but she also got the other assets, like Farcheville, Yellowstone, house in mexico, house in seattle, cars, two jets, etc. Got it!
Tim got his 1/3 of Western Pacific, a house in Seattle, a small house in Palm Springs, Tamarindo and Turks plus 1 Jet plus 13m in cash. This was the deal little ADAM and iswhy she had to take over the BGI notes! She got the couples two largest assets being PC and YC
Yoav R is the 'Greatest Member' and suggest members rally behinnd his bid to buy the club. All members, throw in 200,000 to buy the club and another 10,000 each to loan to Sam Byrne on a 30- day basis and 'Steal' sunrise Ridge like he stole BGI's asset called PC for 35,000,000 !
If everyone listened in court, Edra signed for the BGI notes, yet LIED on her BK statements about she owed these? Why? She is wanting the Judge to help her out like the poor VICTIM she tries to make everyone believe. SHE IS A LIAR! SHE IS A VERY GOOD LIAR. Edra, when you were having your massage person rub you back, your hair dresser do your hair and your chef was cooking your meals, did you stop and think, shit how am i going to pay for this all? Then you said, I know, I will get the banks to loan me money, lots of money, 157,000,000 worth of money and when I cant pay it back I will get together with Sam Byrne, BK Yellowstone Club and blame my EX-Husband Tim. EDRA, wake up, we are all on to your games of trying to be the VICTIM. You created your mess now lay in it. Tim did not borrow from Western Capital did he? Tim did not falsify loan applications did he? Tim did not borrow 35m from Sam Byrne and pledge the families largest single asset outside of YC called PC did he? You did Edra. That means this is your problem and for a lady o your age who still has not figured out the word RESPONSIBILITY and FRIEDNSHIP then you may wish to look for another planetto live on. Have you even apologised to your friends yet for taking thier money, who helped you when in need? You do realize your friends got the shaft. Maybe pick up the phone and call Mr. Sugarman, Mr. Barve, Mr. Thompson, etc? The only way you will show your face in Montana, California and Seattle is by admiting once and for all that Sam Byrne forced you into the BK, Sam Byrne plooted this campaign against Tim and CS only to insure his DIP Loan. Edra, its not to late to come out and tell us all what happened with this 35,000,000 loan and how SB planned this deal. We know their WAS a side deal but now is the time before you have to go on the stand again and Perjury becomes a common thread. EDRA, somewhere there must be some good in you but at this stage you need to turn evidence against Sam Byrne and let all the members know what has taken place. This does not remove you from the loans and problems you created with many banks and freinds but allows you to at least get some respect by those who already know the truth. TB is the least of your problems at this stage, its the criminal courts, the IRS, Perjury statements, etc.
You say that Edra signed the BGI notes of 209m. Which notes? Did she sign the notes for the loans from BGI to Tim & Edra? Or did she sign the notes from Yellowstone to BGI? Sorry if it all seems apparent to you. And how do you know who signed which notes? The notes were prepared well after the fact. And in order to have a substitution of the signers on the note, the lender must approve.
Who is Yoav R? As far as listening in court, some of us don't have the luxery of going to court as we must be the lucky ones that have jobs. So all we know is what is reported in the newspapers.
Since loan papers and corporate filings were not prepared in a timely manner, how long will it take the judge to pierce the corporate veil of BGI?
Your rants are hysterical...in what you say and how you spell.
Get a dictionary, bone up on your english and grammar, and then maybe you can find a job and stop all of you TB bum kissing.
Yaov is the "Greatest Member"??? Yoav cares only about himself and how he can make another dollar. Imagine a YC ran by Yoaf - assuming that he continues on the path that he has - ...buy a YC lot, build the cheapest home he possibly can by the most questionable builder in Big Sky, flip it, buy 2 YC lots, build the cheapest home he possibly can by the most questionable builder in Big Sky, etc, etc, etc...
There's a leader I see the members getting behind???
However, that was a cheap shot on Adam. That was uncalled for, do 50 push ups before you write your next blog, it will calm you down. I know you are working with a lot of uninformed people out here in cyberspace and we certainly do not know as much as you do but more civility would be appreciated.
Keep the truth coming because it will set us all free.
Give us all are break we are tired of your insulting, verbose, ranting, and you are adding nothing new to the conversation.
Frankly I think Tim and Edra should reconcile. They seem to share a lot of the same characteristics, and certainly have a similar moral compass...
At what point does the "woe is me" act get old?
Yeah, let's believe the recolection of a documented liar over the one person who actually paid the bills.
If you want to believe that Edra was just duped, you might ask yourself who exactly had her ear. Ah yes, the loved money manager from Boston, who could not want anything else than to resurrect the flailing club, because he loves the family atmosphere (and the fact that his debacle of an investment in the condos was falling apart). Sam Byrne has been playing both Tim and Edra for over a year now.
You people kill me. Put aside your personal vendettas for the moment and just look at the facts.
- BH is not telling about about what Tim walked away from the marriage with. To wit, he also had land/water rights near Palm Desert appraised at over 500M, he had land in Idaho, and land with reported natural gas rights in Western Washington. So before we get too carried away with the "poor Tim" routine, realize he kept those assets because Edra didn't care about fighting over them.
- Sam is not saving the club for altruistic reasons. if he didn't think there was a way to make some real money he would just sit on the sidelines. i think for everyone involved in this there is the business side and the "love the club side" Yoav wouldn't have brough in Burch and the Everlands guys if there wasn't a bigger scheme down the road...no one at YC got their money passively.
- if the DLC folks are using the club as members, i would be surprised if that survives the resolution of the legal process. i would agree with Incognito, you can't have two classes of citizens and expect it to work.
Can you imagine that your son is rumored to be speaking with the state officials about Gobuild? I can't imagine your own son who turn evidence against you on where the money went do you? Maybe you should give him a call as it appears he has a meeting with them on the 14th of May 2009 a day before you are deposed by the I.R.S and then on the 16th May 2009 at the Holiday Inn Butte Montana with Western Capital and Archer Capital.
I know its not fun what your going through and my blogs are only meant to keep others up to date with the fact you and SB forced this club into BK because of the side deal SB promised you. You know the deal on the land and PC correct? Well, listen if you have not figured it out yet, your littel borrowing spree has placed you in the crapper. Here is what I would do to avoid getting three squares a day!
1) Get new lawyers, ones who represent you and not contolled by SB, Public Defender given you have no money.
2) Turn evidence against SB about the 'Brilliant Plan' Sb talks about in his statements on court record.
3) Tell the members the truth about how SB said it would be so easy to BK the club and to spin all the blame back to TB as SB said he would control the UCC.
4) Tell the curts about the DIP Loan game you played in front of the courts? Come on, you know what I am talking about
5) Confess to your friends and apologise you lied to everyone and sorry you lost their money for good and ask what you can do to make it up.
6) going on national TV and tell the truth once and for all, that you are not a VICTIM, you borrowed 157,000,000 and had no way to pay it back, you thought you could be TB and sell YC lots to get you out of this mess, SB said he would help and only put you 35,000 feet below!
Sorry bloggers, this is the story line!
**** MEMBERS, GET TOGETHER AND BUY THIS CLUB****** THIS IS IN YOUR NTERESTS. SB PLAN IS NOT FOR YOU********************
I am forced to not steal the airtime as JW threatened to 'Out' my name if I did not stop writing about my distgust for SB/EB. I appreciate JW states there are over 200 members who support SB and that Yoav's group is not apart of the 200 members as is the case, thus I am so sad that I can no longer tell my Fair Facts and not the SPIN as others want you to believe. If anyone feels that I should be banned or others believe Im should stay on the blog campaign, lets put it to a vote for JW. I know alot out there believe what I write and its time for JW to know I am not alone or if the majority thinks I am a BLOW HARD and a Piece of Crap then express your feelings to JW. I agree to leave the site completely based on the number of responses I get in favor of me or those who oppose me. We shall use the next 24 hours to determine who HATES my blogs and those who love my Blogs. The highest number wins and JW must allow or delete me forever from Cyberspace blogging on his NEW WEST site? Is this fair to everyone?
Here is how we count a vote:
For Yes: Write Blockhead STAYS
For No: Remove Blockhead NOW
Cast your votes for JW. THe clock starts now for 24 hours. Clearly the odds are against me as JW says there are over 200 members who cant wait for him to turn YC into a cheap condo city!
I will not blog until the votes are counted! Its not easy taking on the INTERNATIONALLY ACLAIMED jw AND NEW WEST but someone must try and give a different version then 'HOW GREAT SB is and how INNOCENT EB is right?
How can you have more disgust for sb than tb? Is it because you are hoping for tb to take over so you can ride the gravy train again? We've all seen how tb runs the club so let's let someone else take over. Too bad Ted Turner doesn't want it. Wouldn't that be great?
Please stay. You've got a lot of insight so it's nice to get another perspective from tb.
Although he/she is a bit of a blowhard and can not separate his personal feelings from his postings, it is good to see additional "facts" that are not presented elsewhere.
On a separate note, if Tim and Edra do not repay the loans to BGI and then to Yellowstone Club, they are both guilty and should be sent to debtors prison.
GDM:.. Has it occured that Crocker could be pissed at EB for helping send Gobuild into the tank, and ruining a reputation, and in fact has a warrent out for his arrest because of a defaulted loan that EB helped get.. Face it..Tim had all the money..When he left edra...Crocker was cut off from the same funding, and that is a fact. I know people who worked for gobuild and the day the divorce was final was the day they werent sure if they would still get paid. When Tim walked away from the club and stopped the cash flow, is when the bills really started to pile up...If you dont believe me..talked to the Controller.Everyone can hate TB if they want...But face it...hes savy when it comes to making deals..TB believed in YC and he was the only person who coulda made it happen and kept it running...
Lets FWD to 2009..IS TB the right man now..not sure..can others pick up the pieces and continue fulfilling the idealogy of the YC...definatly...Whoever it is tho needs to have a grasp of life in Montana. Pay the bills on top, and not overinflate the bubble with false hopes and dreams... They need to be Frank, honest and willing to listen and work with locals.
Blockhead stays...BTW yall...Its not Sumpter and Timmy has more to worry about than using an alias to Blog..
Edra takes over YC and with Sam's help takes YC into BK and guts value of BGI by loaning EB $35 million with a first position on PC thereby stopping UCC from getting their hands on $209 million. Now PC is owned by Sam and the club is worth $100 million. This is a quick lesson in losing $600 million dollars.
As I have said before, you watch, if Sam gets the Club, I think, the side deal between Sam and Edra is that she will Bk and Club and take a $35 million loan from Sam secured by PC that will allow Sam to buy the club for $100 million (a saving of $330 Million from last year's offer) and screws the members out of their $88 Million in member deposits, the Lemond group out of their money and most of the local vendors out of a large portion of what they are owed. For this Edra will get PC back free and clear. Sam invested $35 Million and saved $330 million. Most of us would take that deal. I would not mind makeing $295 million dollars for one year's work. Would You?
Of Course then there is the $157 Million Edra has borrowed that is part of her personal BK. That $157 Million number is a bit off since she forgot, under oath, to include the $209 Million she assumed when she took the YC and PC that were part of BGI.
1. TB out played everyone
2. Blame for negative YC press and falling value rests solely with EB and her advisor/puppetmaster, SAM BYRNE.
Way to go Kemo Sabe!!!
I am needing my possy to 'Pony Up', Hello Kitty, Loneranger and others, thanks for your blogs, your greeeaat! More to blog about but waiting for JW to respond with the voting results before I unload the next version of updates.
And to address the issue of what Tim got and what Edra got in the Divorce....they both agreed...If EB had half the brain..she woulda realized the higher value in land with mineral and water rights is better than a cash strapped community. Her greed is what clouded her judgement..At any cost..she was gonna keep the YC because in the end she thought that would hurt Timmy more. Jokes on her now....
Why don't you simply think before you write, dare I say edit some of your multi volume treatise, and perhaps proof-read once in a while. Punctuation or paragraphs might also be a good idea at some point.
Please keep Blockhead here...if he goes I may then become the stupidest person around here and noone wants that.
For YC the number were 480 lots @ $2.2 million a lot with $180 million set aside to do the infrastructure. That is close to $875 million.
The only thing that is smoking is my calculator as I crank out these numbers.
Are these the same professionals who appraised properties for the so called "liar loans"
207 mil for PC????
Please STOP!!! my sides hurt from laughing.
A property is only worth what people are willing to pay. No one who is sober would pay 207 mil for PC.
Sheesh and people wonder why the real estate market took a dive.
Look as I sit here across the pond I have to wonder if reality has set in at all with anyone involved. This whole situation could have been avoided if certain individuals had ethics and morals.
Why yes I will have another.
Sincerely
Deep Throat
He is no different than Tim, Sam, et al "profit over all"
Mark my words the only people who will benefit from Mr Rubenstien is a certain architect and maybe 2 contractors! One who is a de-facto subsidiary of the architect in question.
Yawn off to my pedicure
Deep Throat.
If the members want to get behind a member so YC is entrusted to someone who cares about their community, they should find someone who cares about the YC as a community and not as a cash cow (if such a member exists).
Yoaf is as big of a joke as TB! But at least TB is an english speaking US citizen.
cs/tb NOT found guilty: Vote Both Not Guilty
CS found guilty: Vote CS Guilty
TB found guilty: Vote TB Guilty
Lets see how our favorite Montana judge decides.
Who wins the club:
TB?
SB/EB?
SB and screws EB?
YR
Members?
Another Investor playing everyone?
I think Dave D has the closest call - especially on EB and Blockhead; I'd vote for him!
TB and CS not guilty.
Member group gets club.
Sam gets PC for CH and sell it to Bill Gates for a small profit and is ousted by Cross Harbor for malfeasance.
Edra goes into exile in a country with out an extradition agreement with the United States and lives off all the money she has put in numbered bank accounts in Switzerland and has 23 more plastic surgeries and looks like Leona Helmsley.
TB tries to reproduce YC2 in Idaho and goes BK again. He retires to the Turks estate and takes up fishing.
TB being held liable to the money he stole and having to repay everything to everyone. Then he goes to jail along with EB.
Another corrupt investor swoops in and wins YC
Yoaf goes and lives under a rock where he belongs.
Dave - I cannot imagine a world where SB makes a deal with TB (if he does indeed win) to develop anything!
Edra has no bank accounts does she? I think she will flea the country as who wouldn't with so many problems. A jet woul have made it easier but CACA Air will get her there. Economy middle seat is punishment enough coming from flying two luxury jets!
TB I think will come out on top still for some reason. The eye before te story. He is a developer and a fighter so I do see the retire thing in Turks but do thinnk we have no seen the last of this 'Developer yet' its in his blood and he does know Timber and land development. Face it, he built the dam thing, so unless others can make such a claim? get my point? Humble Pie however but TB as you all know to well always comes back smiling. Jail time? Not a Chance!
EB: Not a good outlook there. Drug through the wallstreeters BS,played big time and sent packing from PC, 157,000,000 lighter and facing multiple claims, charges and exams. Only the turth will reduce the TIME. Hard thing to do is admit you have been PLAYED but in this case its the only card left to play but must be before the Judge gives his ruling. After that it make no difference as the damage and fate wheel is in motion. Chapter 7 and thats just the beginning I believe given the lawsuits, IRS and friends issues. Dr. Evil needs to be shown the TRUTH about those side deals and the BK arrangement. Good Luck
Members: They stayed in this long and will do so for another 5 years. Leave BG and others out of this mess.
CS: Winner of the Club, Winner of PC, Winner of Family compound, Winner of BK strategy, Winner of worst development but Winner over using EDRA and Le Mond to win. Brilliant PLAN
Sure let Blockhead stay blogging, but he won't give his identity.
It's Blixseth.
interesting question on the Lemond litigation. given how smart they were in managing that process, they would have anticipated the potential outcome of having their payments reclaimed. since so much of the discovery work for this case was done by them, don't think they will be disadvantaged in the long term.
two bids - no Members bid? that is probably disappointing for lots of folks.
maybe we are all closer to getting back to work!
I feel caught up in the swell.
Why yes I will have another mermosa thank you. and on that note Good Morning everyone!
You really should try a Montana Mimosa, which is PBR and OJ; at least that's my recipe. Not a lot of Dom Perignon going on around here these days.