Federal judge: Campaign finance enforcement lawsuits against Tim Eyman can proceed

The State of Wash­ing­ton has a green light to move ahead with its cam­paign finance enforce­ment law­suits against Tim Eyman despite his recent fil­ing for bank­rupt­cy, a fed­er­al judge ruled today after a hear­ing in the Seat­tle fed­er­al courthouse.

After hear­ing pre­sen­ta­tions by Lin­da Dal­ton of Attor­ney Gen­er­al Bob Fer­gu­son’s cam­paign finance unit and attor­neys for Tim Eyman, the Hon­or­able Marc Bar­reca agreed that the State’s cas­es against Eyman fall with­in the police or reg­u­la­to­ry pow­er excep­tion to the pro­vi­sion of the Unit­ed States Code that auto­mat­i­cal­ly paus­es civ­il pro­ceed­ings against a per­son or enti­ty that files for bankruptcy.

The rel­e­vant fed­er­al statute is 11 U.S. Code § 362 (Auto­mat­ic Stay). This pro­vi­sion states that an action such as the State of Wash­ing­ton’s law­suits against Tim Eyman are exempt­ed from the auto­mat­ic stays grant­ed to bank­rupt­cy filers.

… the com­mence­ment or con­tin­u­a­tion of an action or pro­ceed­ing by a gov­ern­men­tal unit … to enforce such gov­ern­men­tal unit’s or organization’s police and reg­u­la­to­ry pow­er, includ­ing the enforce­ment of a judg­ment oth­er than a mon­ey judg­ment, obtained in an action or pro­ceed­ing by the gov­ern­men­tal unit to enforce such gov­ern­men­tal unit’s or organization’s police or reg­u­la­to­ry power …

11 U.S.C. §362(b)(4)

Eyman’s Novem­ber 28th bank­rupt­cy fil­ing caused Fer­gu­son’s office to can­cel depo­si­tions and pause its work to hold the dis­graced ini­tia­tive pro­mot­er account­able. Thank­ful­ly, that work can now resume.

“Mr. Eyman has engaged in a pat­tern of seek­ing to avoid account­abil­i­ty,” said Attor­ney Gen­er­al Bob Fer­gu­son in a state­ment pro­vid­ed to NPI.

“From refus­ing to ful­ly coop­er­ate with our inves­ti­ga­tion, repeat­ed­ly fail­ing to com­ply with court orders, not answer­ing ques­tions under oath, and now using the bank­rupt­cy process in a bad-faith effort to delay our case, Mr. Eyman con­tin­ues to engage in a pat­tern of stall tac­tics to avoid account­abil­i­ty to the peo­ple and the State for his mis­deeds. It’s not going to work.”

Stonewalling in the extreme is how we have char­ac­ter­ized Eyman’s legal defense strat­e­gy here on the Cas­ca­dia Advo­cate and at Per­ma­nent Defense, our project that fights right wing ini­tia­tives. It’s an apt char­ac­ter­i­za­tion con­sid­er­ing the elab­o­rate mea­sures Eyman has tak­en to slow the case down and drag it out.

Eyman and his lawyers con­ced­ed in advance of the judge’s rul­ing that the state’s suits fell with­in the police and reg­u­la­to­ry pow­er exception.

They did try to buy Eyman more time, argu­ing that since Eyman has just switched his legal coun­sel again (the dis­graced ini­tia­tive pro­mot­er is now on his third set of attor­neys), it would be unfair to Eyman for the state’s law­suits to resume before the bank­rupt­cy court signed off on the appoint­ments of Eyman’s new legal team.

But Judge Bar­reca did­n’t go for it.

“That’s just a risk he is going to have to take,” the judge said to attor­ney Joel Ard after Ard explained that Eyman is in between lawyers. Eyman’s orig­i­nal attor­ney, Mark Lamb, no longer rep­re­sents Eyman in any mat­ters, Ard said.

Ard is tak­ing over as one of Eyman’s new attor­neys, but he will not offi­cial­ly be part of Eyman’s bank­rupt­cy team at the fed­er­al lev­el until Bar­reca approves his appoint­ment. Bar­reca direct­ed Ard to sub­mit an amend­ed appli­ca­tion by Jan­u­ary 10th, and set a hear­ing date for Jan­u­ary 17th.

Bar­reca also read from the bench a pro­posed com­fort order request­ed by the State of Wash­ing­ton, which he approved with slight modifications.

A com­fort order, as ele­gant­ly defined by Fed­er­al Judge Karen S. Jen­ne­mann back in 2006, is “a bank­rupt­cy term of art for an order con­firm­ing an undis­put­ed legal result, and often is entered to con­firm that the auto­mat­ic stay has terminated.”

Bar­reca’s order is thus a con­fir­ma­tion that there is no auto­mat­ic stay pre­vent­ing the State of Wash­ing­ton from mov­ing for­ward in its long-run­ning efforts to hold Tim Eyman account­able for his lawbreaking.

(Although Eyman has whined that he is being “per­se­cut­ed” by Fer­gu­son, the cas­es against him were not insti­gat­ed by the Attor­ney Gen­er­al. Rather, they all stem from com­plaints filed by Keep Wash­ing­ton Rolling, Wash­ing­to­ni­ans For Eth­i­cal Gov­ern­ment, and WFEG’s indi­vid­ual gov­ern­ing mem­bers… like me!)

While the State will be able to resume work­ing on its cam­paign finance enforce­ment suits, Eyman’s attor­neys not­ed cor­rect­ly that the exemp­tion from the stay does not allow the state to col­lect mon­e­tary judg­ments with­out the approval of the bank­rupt­cy court dur­ing the dura­tion of the bank­rupt­cy proceedings.

NPI will con­tin­ue mon­i­tor­ing this com­plex, mul­ti­lay­ered lit­i­ga­tion in the weeks and months ahead. It may seem like Tim Eyman is akin to a slip­pery eel, but he has by no means escaped jus­tice. He’s in a lot of trou­ble and is up against a law­man who is just as tough as he is… the esteemed, hard­work­ing Bob Ferguson.