Former Boyce Hydro Owner Denied Bankruptcy After Court Ruling

A federal judge in Nevada has denied the former operator of the Edenville and Sanford dams a Chapter 13 bankruptcy filing.

Lee Mueller, who owned Boyce Hydroelectric which controlled the dams, filed for bankruptcy after the state of Michigan was a warded more than $119 million in a ruling against Mueller for his role in the dams’ failures and subsequent flooding in May 2020. According to the Michigan Attorney General’s Office, Mueller pursued the filing in his home state of Nevada, which was dismissed February 9 after the court found Mueller’s efforts to recuse himself of responsibility for the disaster was done in bad faith,.

According to the U.S. Bankruptcy Court in Las Vegas, Mueller swore in his petition that the amount of his debt owed to the State of Michigan was “unknown,” contending it should not be counted toward a $2.75 million eligibility limit for Chapter 13 filing. The court found that sworn statement was not true, as Mueller knew his debt exceeded the eligibility threshold. The court held that Mueller’s refusal to “fully disclose facts that were known” to him was a “fairly transparent” attempt to “manipulate” the law.

The Attorney General’s Office says the ruling marks the second federal Court to find Mueller using the judiciary in “bad faith” after the U.S. District Court for the Western District of Michigan concluded as much in a ruling to uphold sanctions against Mueller.