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Tim Eyman’s bankruptcy is stalling AG Bob Ferguson’s case against Eyman — as intended

The Daily Herald of Everett‘s astute political reporter Jerry Cornfield has, like our team at NPI, been monitoring the developments in the main State of Washington v. Tim Eyman case for several years now. Today, Jerry has has an important update on how that lawsuit has been affected by Tim Eyman’s recent bankruptcy filing:

The Mukilteo resident filed for Chapter 11 bankruptcy November 28 to protect personal assets as he defends himself against allegations of violating state campaign finance laws. He denies wrongdoing.

The move stopped state attorneys in their tracks in the high-profile case. Under federal law, a bankruptcy filing triggers an automatic stay of civil proceedings against a debtor.

They had to cancel a deposition with Eyman. And they canceled depositions of brothers Mike and Jack Fagan, Eyman’s longtime political partners, which had been slated for December 6 in Spokane, according to public records obtained by The Daily Herald. Developers Kemper Freeman and Clyde Holland and investor Ken Fisher — three of the largest donors to Eyman-led initiatives — also had been lined up for depositions in December, records show.

Longtime readers will recall that Attorney General Bob Ferguson’s office has filed a total of four lawsuits against Eyman and his associates for violating our public disclosure laws. The first three were filed in September of 2016 (all on the same day), and the fourth was filed in March of 2017.

It is the fourth case that has drawn the mass media’s interest and generated occasional front page headlines in newspapers (such as when Eyman was held in contempt of court for failing to turn over documents).

This fourth case stems from Eyman’s conduct in 2012, when he used money donated for one initiative (I-1185) to quietly fund a signature drive for a second, unrelated initiative (I-517) and helped himself to a large chunk of the money that donors thought would be used for signature gathering for that first initiative.

The staff of the Public Disclosure Commission investigated Eyman’s conduct over the course of several years — hindered at every turn by Eyman’s stonewalling.

In September of 2015, the PDC unanimously concluded Eyman broke the law, finding “multiple apparent violations”, and referred the matter to Attorney General Bob Ferguson for further action. The Attorney General’s office then began its own investigation. A year and a half later, the investigation became a lawsuit in Superior Court, and that lawsuit will soon be two years old in a few months.

The long timeframe is mostly Eyman’s doing; stonewalling in the extreme has been his legal defense strategy since even before the filing of the lawsuit.

But Eyman — a shameless man if ever there was one — has nevertheless tried to portray himself the victim of a “witch hunt” by Attorney General Bob Ferguson, characterizing the lawsuit as a “six year persecution” of him and his family.

The truth, however, is that Eyman’s wrongdoing is his own fault, as is the longevity of the case, which Eyman has purposely dragged out in an attempt to evade justice and postpone his day of reckoning. Eyman’s stonewalling tactics have been described at length by the state in its many Superior Court filings.

Eyman seems to be operating under the theory that if he stalls long enough, the case against him will simply go away, vanishing into a legal abyss. However, that has not happened… which has made him very bitter and angry indeed.

Filing for bankruptcy and divorce last month appears to be Eyman’s latest stalling maneuver, intended to buy Eyman time to mount a political comeback in 2019.

As noted above, a bankruptcy filing has the effect of automatically pausing civil proceedings… such as the state’s case against Eyman.

Eyman is certainly not without money, despite what people might be led to think by headlines like Tim Eyman declares bankruptcy.

In his bankruptcy filing, Eyman reported an average monthly income of $42,843 since May 1st, 2018, which is more than many poor Washingtonians make in an entire year. He cited several income streams: one from his political committee, one from a limited liability company he controls, and one from his legal defense fund, plus substantial “gifts” from his relatives and friends.

How can Eyman possibly be bankrupt with so much money rolling in?

Good question!

In his bankruptcy filing, Eyman cited the relief and attorney’s fees sought by Attorney General Bob Ferguson, which Eyman says add up to $3.2 million once his own legal bills and court costs are included, against assets of $2 million.

Ferguson’s office hasn’t yet won the $2 million penalty it’s seeking from Eyman (again, due to Eyman’s stonewalling), but that didn’t stop Eyman from listing it as a liability in his bankruptcy filing.

State attorneys are asking the federal bankruptcy court to allow the case against Eyman to resume. Federal Judge Marc L. Barreca will consider their request on Friday, January 4th, 2019, in Seattle.

Eyman hasn’t qualified a measure for the Washington State ballot since 2015, but is hoping that 2019 will be his comeback year. The disgraced initiative promoter, desperate for relevance, is currently trying to complete a signature drive for Initiative 976 (a measure that would gut transit funding at every level) and hopes to qualify two more measures to the 2019 ballot in the coming months.

Eyman claims to have funded the I-976 signature drive using his cashed-out retirement savings. But since Eyman lies with impunity on a regular basis (lying is like breathing to him), we have no idea where the money really came from.