Las Vegas Bankruptcy Court Ruled Proper Venue for Involuntary Bankruptcy Against Former Billionaire
The Ninth Circuit Bankruptcy Appellate Panel ruled Nevada is the proper place for the involuntary bankruptcy against Timothy L. Blixseth to be heard. If you are having financial troubles, contact bankruptcy lawyers Las Vegas debtors can depend on for help getting your bankruptcy case started.
Blixseth who was once listed as one of Forbes’ richest 400 Americans, was apparently unable to pay his taxes, which forced the former billionaire into Chapter 7 bankruptcy. He owed the Idaho State tax Commission $1,117,914, the California Franchise Tax Board $986,957, and the Montana Department of Revenue $219,258.
Involuntary bankruptcy is when creditors, rather than a debtor, file the bankruptcy petition. It forces a person or company into bankruptcy so that creditors can enforce their rights. A Las Vegas bankruptcy attorney can help you file for voluntary bankruptcy so you can avoid a forced involuntary bankruptcy.
In Blixseth’s case, the involuntary Chapter 7 bankruptcy was filed in the District of Nevada. The petition noted that even though Blixseth’s residence was near Seattle, his county of residence or principal place of business was listed as Las Vegas. However, Blixseth claimed he had no business or place of business in Nevada, although his primary asset was his holding company Desert Ranch LLLP, a Nevada corporate entity.
The original bankruptcy court agreed with Blixseth that the venue (the place a legal case is heard) was not appropriate in Nevada and dismissed the petition. On appeal, the Ninth Circuit Bankruptcy Appellate Panel reversed this finding in a 2-1 decision. The panel said Nevada is the proper venue because the creditor’s remedy is to go after the debtor’s assets, which in this case is his interest in his holding company, which was formed in Nevada.