Yellowstone Club founder asks federal court to sanction Montana for destroying emails
Friday, April 21, 2017
Montana’s destruction of government emails violated state law and the order of a federal judge, Tim Blixseth argued in court filings Wednesday that are part of the involuntary bankruptcy case against the Yellowstone Club founder.
Blixseth and the State of Montana have been embroiled in a legal battle since 2011. The Yellowstone Club filed for bankruptcy in 2008 after Blixseth was accused of pocketing a loan made to the resort. The club’s creditors have sought millions from Blixseth personally. Montana has so far failed to recover $57 million in alleged back taxes from Blixseth through involuntary bankruptcy.
In an ongoing appeal, Montana had requested and received a stay order that, in effect, froze the case as is. It barred any new discovery of evidence for the case. State law also requires all related records to be preserved whether or not they have yet been entered in court.
Blixseth’s attorneys now argue in federal bankruptcy court that the destruction of email accounts for several state officials violated that order, Lee Newspapers of Montana reports.