Walker seeks lien, potential sale of MBC

Lakeland Times and River News publisher Gregg Walker has filed a motion for a charging order with circuit judge Leon Stenz that would place a lien on Kirk Bangstad’s interest in the Minocqua Brewing Company to ensure the payment of defamation judgements against Bangstad and the company and that would force the sale of the company if the judgment is not paid in a reasonable time period.

As Walker’s attorney, Matthew Fernholz, declared in the motion, a charging order constitutes a lien on a judgment debtor’s transferable interest and requires the limited liability company to pay over to the person to which the charging order was issued any distribution that otherwise would be paid to the judgment debtor. 

In effect, any payments to Bangstad and any company profits would have to be paid until the judgments were satisfied.

Wisconsin statutes provide that a judgment creditor may make application to the court for a charging order against the transferrable interest of the judgment debtor for the unsatisfied amount of the judgment. Walker holds two joint and several judgments against Bangstad and Minocqua Brewing Company (MBC), which, the motion states, total $803,153.31 and $348,290.41, respectively as of September 9. 

“Defendants have made no payments on the judgments and have indicated they have no intent to make any payments on the judgment,” the motion states.

In addition, the motion continued, “in the event distributions under the charging order do not pay the judgment debt within a reasonable time, pursuant to [state statute], Walker requests the court order the sale of Bangstad’s interest in the Minocqua Brewing Company, LLC, and that Walker be empowered to conduct this sale in the manner prescribed for sale under Chapter 409, and that Walker be permitted to credit bid at such sale.”

Stenz will make the decision on the charging order.

The motion comes after a state court of appeals denied a bid by Bangstad and MBC to delay payment of the two money judgments against them. They owed the money judgments after an Oneida County jury found that they committed multiple counts of defamation against Walker, awarding Walker what is believed to be the largest defamation judgment in state history.

The verdict was decided unanimously by 13 jurors. 

Bangstad has appealed the verdict and earlier sought to stay execution of the money judgments pending the outcome of the appeal. The circuit court denied the motion to stay the payments pending appeals, and a little more than a week ago the court of appeals upheld the circuit court’s order.

The decision lifted a temporary stay put in place by the appeals court to allow each party to submit additional materials, including a transcript of the circuit court’s decision.

Social justice

In announcing the denial, district III appeals court presiding judge Lisa Stark said the court was satisfied that the circuit court properly exercised its discretion in denying the stay by reasonably applying the correct standard of law to the relevant facts.

Bangstad had argued for the stay, saying he was likely to succeed in overturning the verdict on appeal and that the circuit court failed to give proper consideration to his assertion that he would raise new First Amendment claims on appeal that must be reviewed de novo, that is, from the start, without reference to any legal conclusion or assumption made by the circuit court.

The appeals court rejected Bangstad’s arguments. 

In this case, Stark concluded, the record showed that the circuit court explicitly considered each of the relevant criteria.

“As to the likelihood of success on appeal, the court observed that Bangstad was relying upon a ‘ludicrous’ reading of Polzin v. Helbrecht to support its position that the court had erred in refusing to apply the actual malice standard in this case, and that he was proposing to raise new arguments on appeal that he had forfeited by not asserting during summary judgment or other points in the proceedings,” Stark wrote. “Based on the facts and positions Bangstad had actually presented during the litigation, the court found there was not more than a mere possibility that Bangstad would prevail on appeal.”

As for Bangstad’s contention that the circuit court failed to give proper consideration to new First Amendment claims, Stark wrote that just because those claims will be considered de novo does not necessarily mean that they are any more likely to be sufficient to justify granting his motion to delay payments.

“While it is true that the standard of review for an issue is an aspect of the evaluation as to the likelihood of its success on appeal, it does not follow that every issue subject to de novo review automatically has a sufficient likelihood of success on appeal to warrant a stay,” she wrote. “Here, the circuit court considered both the actual merits of the issues Bangstad said he planned to raise, and whether they had been properly preserved for appellate review.”

The circuit court was also concerned that Bangstad’s conduct during the judicial process suggested he would attempt to avoid payments, Stark wrote.

“As to the collectability of the judgment and accumulated interest, the court found that Bangstad’s pattern throughout the litigation of refusing to comply with court orders requiring his disclosure of financial information, his failure to appear for a supplemental examination, and his failure to provide any type of security for payment of the judgment suggested that Bangstad would try to frustrate collection,” she wrote. “The court further considered other options to secure payment of the judgment, including insurance coverage, but did not consider those options viable at this time.”

All in all, Stark wrote, the court reasoned that staying collection pending appeal would jeopardize collectability by giving Bangstad time “to hide assets.”

Richard Moore is the author of “Dark State” and may be reached at richardd3d.substack.com.