A Kalispell radio station owner is contesting a motion filed by the federal government to change a Chapter 11 bankruptcy to a Chapter 7 filing, which would force him to liquidate his assets to pay his debts.
KGEZ owner John Stokes filed for Chapter 11 bankruptcy protection March 4 after a Flathead County jury ordered him in late 2008 to pay $3.8 million to businessmen Davar and Todd Gardner for defaming them on his radio show.
On April 22, the Office of the U.S. Trustee asked to convert Stokes’ application to a Chapter 7 liquidation — calling the station owner’s financial statements “atrocious” for excluding numerous assets and debts.
Stokes’ attorney, Gregory Duncan of Helena, filed paperwork May 1 in U.S. Bankruptcy Court for Montana to argue against a change. He said the U.S. Trustee’s office held an April 10 hearing on the Chapter 11 request even though it knew Stokes’ financial statements were incomplete.
U.S. Trustee attorney Neal Jensen said Stokes had more than a month to prepare his records for the hearing and that presenting substandard information with a “cavalier attitude” should not be an excuse to avoid a Chapter 7 ruling.
Stokes declined to comment, saying he has not seen any documents filed in the bankruptcy case other than the initial paperwork.