Investigators urged in bankruptcy case

Ex-developer’s $90M filing targeted

The trustee in the Texas bankruptcy case of a former Northwest Arkansas developer is asking the court for permission to hire as special counsel a Dallas-based law firm with extensive experience in litigating bankruptcies.

In a filing Friday, Scott Seidel, the trustee in the bankruptcy case of Bill and Carolyn Schwyhart, asked the court to employ the law firm Munsch Hardt Kopf and Harr effective April 6. The trustee noted that the Texas firm, which also has offices in Austin and Houston, has extensive experience representing bankruptcy trustees in multiple fields including “recovering preference, turnover, lien avoidance, fraudulent transfer, alter ego, breach of duty and other claims of action.”

Munsch Hardt would, among other duties, advise on possible claims against third parties, including against Pinnacle Villa LLC and others, who the filing says could be recipients of fraudulent transfers or alter egos of the Schwyharts. The law firm would also look into claims the Schwyharts may have hidden property from the bankruptcy estate using strawmen and fraudulent transfers, according to the filing.

In his request to hire Munsch Hardt, the trustee noted complex legal issues and potential litigation might come about in the case and that the law firm has

“considerable experience and versatility in these matters.”

In July 2018, Bill Schwyhart and his wife filed for Chapter 7 bankruptcy protection in Texas, claiming more than $90 million in debt.

A complaint on the discharge of the bankruptcy made by CHP, an investment group, contends that Schwyhart and his wife lied about or failed to disclose their ownership in various business entities in order to defraud creditors and hide information about their finances.

The Schwyharts contend they have done nothing wrong. Their attorney has asked that the complaint be dismissed and that their bankruptcy be discharged, saying the couple never intended to hinder, delay or defraud, and that all acts or failures to act outlined in court documents were justified under the circumstances of the case.

During the Northwest Arkansas building boom, Schwyhart worked with trucking magnate J.B. Hunt and Tim Graham on the Pinnacle Hills Promenade mall, which opened in 2006. After Hunt’s death later that year, his widow, Johnelle Hunt, and Graham broke ties with Schwyhart.

Schwyhart was also one of the investors, along with J.B. Hunt, in the now-defunct charter-jet company Pinnacle Air LLC, which did business as Aspen JetRide. It filed for Chapter 7 bankruptcy protection in early 2009.