BUTTE, Mont. - A federal judge on Thursday ordered Tim Blixseth jailed after the onetime billionaire and embattled real estate mogul failed to comply with an order to pay nearly $14 million to the creditors of an ultra-luxury Montana resort.
At a hearing in Butte, U.S. District Judge Sam Haddon said the Yellowstone Club founder must be held in custody until he can come up with an accounting for the money.
Blixseth's attorney Michael Ferrigno said he was unsure how long that will take because his client has told him many of the documents are in Mexico.
Haddon last year found Blixseth in contempt of court for selling a property in Mexico in defiance of another judge's instructions.
Blixseth delayed potential court sanctions for months with an unsuccessful appeal to the 9th Circuit U.S. Court of Appeals.
Creditors' attorneys want him incarcerated for not abiding Haddon's order that Blixseth turn over the money from the sale or post a bond in an equal amount.
The case stems from the 2008 bankruptcy of the Yellowstone Club, a members-only ski and golf resort near Big Sky founded by Blixseth and his ex-wife, Edra.
The club emerged from bankruptcy in 2009 under new ownership. However, its creditors have spent years trying to collect on $241 million that courts have ruled Blixseth fraudulently drained from the club for his and Edra's personal use.
Tim Blixseth claims he no longer has the $13.8 million from the 2011 sale of the El Tamarindo resort, which included hotels and condominiums in the state of Jalisco. He originally paid $40 million for the property.
A federal judge earlier ordered that the property not be sold or transferred while the bankruptcy proceedings were pending.
In a declaration filed earlier this month, Blixseth told the court he received only about $9.5 million for the Mexico property after various expenses were factored in. That money was later spent or transferred, he said.
Blixseth also submitted hundreds of pages of financial documents — many of them in Spanish — to back up his claims.
Haddon blasted Blixseth during an earlier proceeding for deliberately withholding information about the sale from the court.
Attorneys for the club's creditors, known as the Yellowstone Club Liquidating Trust, said Blixseth's attempt to explain where the money went amounted to an incomplete "document dump." They said he left $8.7 million still unaccounted for, and asked that Blixseth be incarcerated until he fully complies with the court's earlier order.
Judges have broad discretion in how they police those who come into their courtrooms for civil proceedings, including sending them to jail.