Bankruptcy court likened to brothel by vexed investor

A 70-year-old retired petroleum engineer who lost $200,000 invested with hard-money lender USA Capital may learn the limits of freedom of speech when he appears before a bankruptcy judge in May.

In papers filed in USA Capital's bankruptcy case, Curtis Clark of Boulder City calls the bankruptcy court a brothel and compared Judge Linda Riegle to a madam.

"The bankruptcy court is a brothel," Clark wrote. The investor also referred to a company that acquired the right to service loans from USA Capital as "the john" and said the judge "pays the working girls and provides the condoms."

He added: "This orgy is an all-nighter."

Asked about his comments, Clark said: "You have a right to express an opinion."

Defense attorney Matthew Callister said: "(Clark) made some inappropriate comments, and we're going to try to find a way to work this out."

Rather than consider the matter involving Clark, Riegle recused herself and it was assigned to bankruptcy Judge Bruce Markell.

Markell's order says that a judge would have little authority to take action because of a party's "inflammatory comments" if they are made in a letter to a newspaper or on a sign in front of the courthouse. However, Markell said Clark made his comments in a filing with the bankruptcy court.

Markell scheduled a May 13 hearing over whether he should refer Clark to federal district court for possible criminal contempt proceedings.

Richard Wright, a prominent local defense attorney who does not represent Clark, said a federal judge could fine the defendant an unlimited sum and sentence him to a prison sentence of any length for criminal contempt.

Bankruptcy attorney Rob Charles said he "was offended that (Clark) would use that kind of language in reference to the bankruptcy court, the judge and the process. I was really sad for (Clark), because I think he lost his perspective about how to act as a human being."

USA Capital filed for bankruptcy in 2006 while owing 6,000 investors $962 million. No criminal charges have been filed.

Contact reporter John G. Edwards at jedwards@reviewjournal.com or 702-383-0420.