January 19, 2008 in City

Moe must pay $315,000 for defying court

By The Spokesman-Review
 

The largest contempt-of-court sanction ever levied in Spokane County Superior Court – $315,000 – was handed down Friday against Orville Moe, the deposed operator of Spokane Raceway Park.

Judge Robert Austin levied the sanction, declaring Moe had defied repeated court orders to produce ownership documents and business records detailing financial interests, including his own, in Washington Motorsports. That’s the limited partnership that owns the mile-square racing complex in Airway Heights.

The judge also ruled that Moe must pay legal fees associated with the contempt action incurred by court-appointed receiver Barry W. Davidson and the receiver’s attorney, John Giesa.

Those fees aren’t yet calculated, but when they are the sanction and legal bill may approach $500,000. The judgment against Moe could be satisfied by filing liens against his property, including his financial interest in Spokane Raceway Park.

The record-setting monetary sanction came one week after the same judge granted the receiver permission to hire J.P. King Auction Co. Inc., of Gadsden, Ala., to sell the raceway at public auction before April 13.

Details of that auction, including the location where it will be held, are expected to be announced in the next few weeks.

Moe wasn’t present for Friday’s hearing and didn’t return a telephone call seeking his reaction.

The $1,000-a-day sanction for contempt of court, going back to Dec. 8, 2006, was sought by Davidson, who has been operating the track since mid-2005.

“It’s a very significant sanction,” Davidson said.

The receiver said Moe has had several opportunities to produce the documents, under deadlines set by the court, to avoid the financial judgment rendered Friday.

“He’s always had the ability to purge himself,” Davidson said, “and he’s chose not to …”

Besides awarding attorney fees and the remedial sanction, the judge ruled that Moe can’t use documents he finally produced in November. Moe contends those documents show proof of what shares of Washington Motorsports he owns.

In those filings, Moe gave no explanation for failing to turn over the documents months earlier.

A trial date over Washington Motorsports shares owned by Moe and his daughter, Susan Ross, and business-partner-attorney Robert Kovacevich, was rescheduled from February to April.

The receiver was appointed by the court as an outgrowth of a suit brought by limited partners who presented evidence and testified at various earlier court hearings that Moe had engaged in self-dealing and fraudulent stock share transactions.

The limited partners and their heirs, thought to number more than 500, contend in their suit that they received no return on an estimated $2.5 million they invested in the track in the early 1970s.


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