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Hecker loses bid to delay creditors' lawsuits
Hecker loses his bid to delay pending creditor lawsuits while a grand jury investigates.
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Former auto mogul Denny Hecker took one on the chin Wednesday as a U.S. bankruptcy judge denied his request to stay all eight lawsuits against him for six months. As a result, Hecker's deposition by a U.S. trustee will proceed as scheduled Thursday morning.
Hecker attended the hearing Wednesday with his girlfriend, Christi Rowan. He had petitioned the court to delay the suits by Chrysler Financial and seven other lenders until a federal grand jury decides whether to indict him on criminal charges.
Hecker's attorney, Bill Skolnick, argued Hecker could compromise his constitutional right against self-incrimination if forced to testify in civil court. "Mr. Hecker is a target by a criminal investigation by the U.S. government" and he might have to assert his Fifth Amendment rights or waive them, Skolnick said.
But Judge Robert Kressel said there "may or may never" be an indictment and creditors should be able to proceed with claims. The plaintiffs contend Hecker's debts should not be discharged in bankruptcy because he incurred them by committing fraud. Kressel said Hecker may invoke his Fifth Amendment rights at any time.
Attorneys for Chrysler Financial, Hyundai Motor America, Cornerstone Bank, Vision Bank, GELCO/GE Fleet Services, Carlton Financial Corp., Alliance Bank and U.S. Bank opposed Hecker's request to stay bankruptcy proceedings. Chrysler Financial attorney Howard Roin said it's unlikely criminal charges would be filed before next spring. The U.S. Attorney's office convened a grand jury this summer to determine whether Hecker should be charged with committing crimes as he sought loans and tried to salvage his auto sales and leasing empire.
Hecker filed for bankruptcy protection in June, claiming $18 million in assets and $767 million in debt.
In a separate matter, Kressel denied a motion by trustee Randy Seaver that sought to reject a property lease agreement between Rowan and Hecker. Kressel denied the motion "without prejudice," meaning the matter can be converted into a lawsuit by Seaver.
Rowan had agreed to pay $5,000 in monthly rent to continue living in one of Hecker's two Medina homes. Seaver originally refused to accept the payments, alleging the money originated from Hecker and so belonged to the estate the court is liquidating. Going forward, Kressel ordered Rowan to pay the rent to the trustee, but acknowledged Seaver was not waiving any rights by accepting it on behalf of the court.
Dee DePass • 612-673-7725
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