March 12 (Bloomberg) -- Tim Blixseth, the billionaire developer of the Yellowstone Club, a private ski resort in the Montana Rockies that has counted Bill Gates and golfer Annika Sorenstam as members, is short of cash, again.

Blixseth made his first fortune in timberland, then declared bankruptcy in 1986 when lumber prices fell. He made a second fortune as values rebounded and built the Yellowstone Club.

Now, court documents show Blixseth is late with a payment of $20 million that he owes to Tour de France winner Greg LeMond and three other Yellowstone investors to settle a lawsuit over their stakes in the resort, where empty lots start at about $2 million. He agreed to pay a total of $38 million and has already paid $18 million.

Blixseth, 57, has told the group he can't pay them until he closes the sale of the club. In January, he was in talks with CrossHarbor Capital Partners LLC, the Boston-based private- equity firm founded by Yellowstone member Sam Byrne. Blixseth agreed to sell ``significant assets'' of the club on Jan. 15, for $455.7 million, according to an affidavit from Robert Sumpter, the Yellowstone Club's vice president of development.

``I'm mystified as to why this so-called billionaire can't provide $1 out of $20 million to my clients,'' said Christopher Madel, a Minneapolis-based lawyer at Robins, Kaplan, Miller & Ciresi LLP, who's representing LeMond and the other plaintiffs.

Blixseth ranked 380th on Forbes magazine's list of the wealthiest Americans last year, at $1.3 billion.

Divorce Proceedings

Any suggestion that he is having financial difficulties is wrong, Blixseth wrote in an e-mail message. ``None of this is even close to the truth,'' he said. ``In the real estate business one can have a million one day and $50 million the next. That is the nature of the beast.''

Byrne also declined to comment.

Complicating Blixseth's finances is his pending divorce. The Blixseths have plenty of assets and little cash, according to documents filed by Tim Blixseth in California state court in Riverside County.

The assets include a mansion on a private golf course in Rancho Mirage, California, that Blixseth values at $250 million; a house on a private island in Turks and Caicos pegged at $27.5 million, and a 2006 Rolls-Royce Phantom valued at $250,000.

A tally of checking and savings accounts, and stocks and bonds came to $916,293 as of Aug. 2, the date of the filing.

LeMond's Complaint

``Unfortunately, because of a combination of events beyond our control, our liquidity position has been difficult in the past few months, and, in fact, I have lent money from my separate property borrowings to pay the more urgent debts,'' Blixseth wrote in the filing. Sales have slumped at the Yellowstone Club, in part because the fight with LeMond has made buyers skittish, he said.

LeMond got involved with Blixseth in 1999, when he and his friend Jorge Jasson, and his inlaws David and Sacia Morris, invested in the club and bought property there.

The relationship soured in May 2005 after Blixseth offered to buy them out for $1.25 million plus one new lot in the club. Jasson asked for information to evaluate the offer. Blixseth refused to provide details, according to LeMond's complaint.

The group learned in August that the club had secured a $230 million loan, arranged by Zurich-based Credit Suisse Group, and planned to use it to make a payment to owners. LeMond and his group expected to receive $2.3 million each.

`We Can't Pay'

Blixseth didn't pay, and on May 31, 2006, they sued in Montana state court in Virginia City, alleging Blixseth tried to buy them out at a below market rate. Blixseth settled on Oct. 25, agreeing to pay LeMond's group $38 million, according to copies of the settlement agreement filed in the Montana court. He handed over $18 million to the LeMond group on Oct. 31 and Nov. 1 and was supposed to pay an additional $20 million by Jan. 31, the documents show.

``We cannot pay anything today,'' Blixseth wrote in a Jan. 31 e-mail to Jasson that's part of the Montana court documents. ``Sales have been hurt this past year and we are focused on getting the sale (of the club) closed and paying off all of the obligations.''

Shortly after, LeMond's lawyers asked Judge Loren Tucker to grant a writ of attachment on Blixseth's 160-acre compound at the club, which is under contract to be sold for $56 million, according to Sumpter's affidavit. Such an order allows a sheriff to seize a defendant's property to satisfy a judgment.

Yacht Trip?

Judge Tucker granted the writ on Feb. 11. The next day, Tucker issued a summons for Blixseth to give a deposition on his personal assets and liabilities and those of the club. His lawyer responded on Feb. 13, saying Blixseth would be out of the country.

In a February affidavit, Blixseth's wife, Edra, supported that contention, with a caveat. She wrote that Tim donated a week on one of his yachts to a charity auction. It sold for $95,000, and the buyers planned to board the boat around Feb. 16. But Tim instructed an employee to tell the winners the boat wasn't ready, Edra wrote.

``That is not accurate,'' Edra wrote. ``I am informed and believe that Mr. Blixseth has made arrangements to entertain friends on the yacht starting on Feb. 15, 2008, for the entire week. This is the reason he is unavailable.''

The sides met in court on Feb. 21, and LeMond's lawyers agreed to give Blixseth until April 15 to pay. In exchange, they dropped plans to seek a writ of attachment on the entire Yellowstone Club.

To contact the reporter on this story: Anthony Effinger in Portland, Oregon, at aeffinger@bloomberg.net.

Last Updated: March 12, 2008 00:01 EDT