Aug. 11 (Bloomberg) -- The mother of Czech fugitive Viktor Kozeny won a legal battle in her effort to retain control of more than $21 million from the sale of “Peak House,” one of the highest homes on Aspen, Colorado’s 10,413-foot Red Mountain.
Federal prosecutors last year brought a civil lawsuit to seize funds from the sale of the house, which was owned by Kozeny’s mother, Jitka Chvatik, and companies she controlled until it changed hands in 2001. Prosecutors claimed Kozeny used the chalet as part of a fraudulent investment scheme in 1997.
U.S. District Judge Harold Baer in New York ruled yesterday that prosecutors waited too long before filing their lawsuit, which the judge dismissed. James Nesland, a lawyer for Kozeny, said today in an interview that the ruling may help as Chvatik battles the government’s separate effort in a criminal case against Kozeny to seize the proceeds.
“It is unfortunate that this action, which appears to have some merit and involves a substantial amount of funds, must be dismissed on procedural grounds,” Baer wrote in a 15-page opinion. “There is no question that the government learned of the Peak House funds at the very latest by 2005 and sat on its hands until 2009.”
The ruling is the latest in a series of court victories for Kozeny, who has avoided extradition to the U.S. on federal bribery charges stemming from a venture in Azerbaijan. He is also wanted in the Czech Republic, where he is accused of defrauding thousands of investors in mutual funds in the early 1990s. Kozeny denies wrongdoing.
Omega Advisors Inc., a hedge fund that invested with Kozeny, settled its lawsuit against him last year. According to testimony in a 2009 criminal trial against another investor in the deal, Kozeny made no payments to resolve that lawsuit.
Yusill Scribner, a spokeswoman for U.S. Attorney Preet Bharara in Manhattan, declined to comment.
The case is U.S. v. Funds Held in the name of Landlocked Shipping, 09-cv-03481, U.S. District Court, Southern District of New York (Manhattan).
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