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Stage 1 fire restrictions return to Pitkin County, upper Roaring Fork Valley area

As expected, Pitkin County officials decided Friday morning to reimpose Stage 1 fire restrictions because of continued hot and dry weather conditions, according to a news release.

The restrictions are scheduled to begin at noon Friday and will restrict campfires to fire pits and fire rings in established, official campgrounds only. Fires will not be allowed for backcountry, dispersed camping.

The decision was made by Pitkin County Sheriff Joe DiSalvo in collaboration with area fire chiefs and officials from the White River National Forest and Bureau of Land Management, according to the release.

The dry forecast for the next month or so, historic lows in backcountry fuel moisture and the beginning of hunting season prompted the decision, officials have said.

Garfield County Stage 1 fire restrictions began just after midnight today.

Marijuana venture goes up in smoke, $5 million dispute lands in Aspen court

A business fallout over a marijuana-investment venture has landed in court.

Aspen businessman Jordan Lewis once forged a private-equity venture with New York-based agriculture investment firm B. Zaitz & Sons LLC and High Times magazine attorney Michael Kennedy, with a mission to raise $300 million to help sustain or launch marijuana businesses.

The venture, forged in the spring of 2014, captured headlines in such publications as Financial Times and Bloomberg. But on Tuesday, B. Zaitz & Sons LLC and two associated parties filed suit against Lewis and a host of limited liabilities he controls in Pitkin County District Court.

Lewis is the majority owner of Silverpeak Apothecary, one of the first recreational cannabis dispensaries to open in Aspen, as well as High Valley Farms, a cultivation facility near Basalt.

The suit, which seeks nearly $5 million, does not delve into how Lewis, Zaitz & Sons and Kennedy got into business. Kennedy's name also is not mentioned in the complaint.

The lawsuit focuses instead on loans given to Lewis' companies by B. Zaitz & Sons, Zaitz Trust LLC and David Zaitz, the CEO of B. Zaitz & Sons.

Lewis is accused of fraudulently transferring loans that were intended to support his Silverpeak and High Valley Farms operations to a marijuana venture he started in Uruguay.

"This case, among other things, seeks to unwind the fraudulent transfers made to and effectuated by Lewis and his Uruguayan venture under the Colorado Uniform Fraudulent Transfers Act," the suit says in its opening statement.

Lewis on Thursday referred questions to his Aspen counsel, Daryl B. Cramer of the firm Genshaft Cramer LLP, who said in a statement: "Although we do not comment on pending litigation, we can say the allegations against Mr. Lewis and entities in Uruguay are unfounded and will be vigorously defended. The allegations by the Zaitz family as the most junior limited unsecured creditors to certain of the Silverpeak businesses in Colorado are unfortunate and will also be addressed in the appropriate forums."

Lewis and his companies now owe $4.7 million on the loans, which have per annum interest rates ranging from 10 percent to 12 percent, and were not paid when they came due July 1, the suit contends.

Among the loans were $1.1 million that Zaitz & Sons provided to High Valley Farms in October 2013; $2 million given to Cooper Mason Ventures (controlled by Lewis) by the individual David Zaitz in June 2014; and separate loans of $250,000 and $125,000 from the Zaitz Trust to SP Operations LLC (also Lewis controlled) in June 2015 and July 2015, respectively, the suit alleges.

By 2016, Lewis began developing a pot enterprise in Uruguay; he was focusing most of his attention on the endeavor by 2017, the suit contends. Uruguay became the first country to legalize marijuana, in 2017. Lewis called his startup in the South American country Fotmer.

"From 2016 — facing the debt obligation to the Zaitz Parties and in an effort to divert money away from the Zaitz Parties — Jordan Lewis, as a principle of SP Parties and of Fotmer and as the primary director of the Uruguay Project, used the SP Parties' money and assets to build and fund his Uruguay Project," the suit alleges.

The suit makes one claim for fraudulent transfer and three claims for breach of contract. David Chipman and Ashley Schubert of the Denver firm Chipman Glasser LLC filed the complaint for the plaintiffs.

rcarroll@aspentimes.com

Colorado Gov. Hickenlooper makes step toward 2020 presidential run

DENVER — Colorado’s Democratic Gov. John Hickenlooper on Monday took his most concrete step yet toward running for president by forming a federal campaign committee that can raise money to help candidates nationwide.

Hickenlooper’s so-called Leadership PAC, called “Giddy Up PAC,” will be led by Brad Komar, who ran the governor’s 2014 re-election campaign. Its formation allows the governor to distribute money to campaigns in other states, usually a hallmark of politicians with presidential aspirations.

Hickenlooper, 65, has long been floated as a possible 2020 presidential contender. He’s a popular two-term governor of swing state Colorado who has a colorful background as an oil geologist and brewpub owner.

But his background in the energy sector and defense of the industry could be a drag in a Democratic primary, as could his more centrist stances in office. He has already visited the early voting states of Iowa and New Hampshire as his second term as governor winds down.

Hickenlooper is term-limited out of office at the end of this year. In an interview with Colorado Public Radio on Monday, he said he’d make a decision on whether to run for president after that.

Four fires burning in northwestern Colorado, including new one near Wyoming border

STEAMBOAT SPRINGS — A seemingly constant drone of helicopters fighting wildfires hummed over the Yampa Valley this weekend.

Crews are now fighting four fires in Northwest Colorado. For fire and closure information, visit inciweb.com.

Ryan Fire

The Ryan Fire was first reported Saturday night, and is burning in more than 500 acres of live and beetle-killed lodgepole pine, said Routt National Forest spokesperson Aaron Voos.

The fire is originated in the northern tip of the Mount Zirkel Wilderness Area, but is growing rapidly and moving toward the Wyoming border. It has passed U.S. Forest Service Road 80, which runs parallel to the border and less than a mile from the state line.

Fire staff and law enforcement are working to evacuate game management unit 161, which includes hunters and campers along the entirety of Forest Service Road 80 in Colorado.

In Wyoming, elk area 13 and deer area 81 are being evacuated. This includes the Hog Park area and the area south of Forest Road 496 from its intersection with Forest Road 550 east and north to its intersection with Forest Roads 409 and 404.

No homes have been evacuated. The fire does is not immediately threatening structures.

The fire is growing quickly. Helicopters fighting the Ryan Fire were grounded Sunday afternoon in light of high winds.

“The winds are high enough that they haven't been able to fly aerial resources,” Voos said. “Ground crews aren’t very effective with a rapidly moving fire in fuels like this. Even though we would like to, we're not able to suppress the fire at this point, so right now what we're doing is focusing on evacuations.”

The Rocky Mountain Black Type 2 Incident Command team will soon take over incident command of the fire, Voos said.

“That says a lot, for a fire that was just reported last night,” he said.

The fire was initially called the Nih Fire. It is burning about 6 miles from the Routt and Jackson County border.

Silver Creek Fire

The Silver Creek Fire was burning in 11,405 acres and 35 percent contained Sunday. This is about 800 acres larger than the area reported Saturday and the same containment level.

U.S. Highway 40 remained open Sunday. Colorado Highway 134 is closed from mile marker 17 to 27.

“I believe that things are looking better today than they have been as far as the possibility of a highway closure,” Voos said. He added that fire activity — and smoke produced by the fire — decreased Sunday.

Latigo Guest Ranch, the Yost Ranch and homes in the Gore Lakes and Old Park area have been evacuated. The Milk Creek State Wildlife Area has also been evacuated to get hunters out of the fire’s projected path.

Pre-evacuation notices have been issued for Rabbit Ears Village, Bear Mountain and the Lake Agnes area.

Protecting structures in the areas evacuated was a priority for firefighters Sunday. A group working to protect structures was strategizing where to place sprinkler systems in the Lake Agnes and Latigo Ranch area. Firefighters were patrolling Latigo Ranch, the 100 Road and the U.S. 40 corridor from Tyler Mountain to Rabbit Ears Village.

Grand County residents were encouraged to enroll with the county’s emergency alert system, so emergency managers could reach them quickly if evacuations become necessary.

Two hundred seventy-five firefighters battled the fire where it is safe to do so Sunday. The fire had priority for air support in the region. Two helicopters that can carry up to 700 gallons of water and fire suppressant and two helicopters that carry up to 100 gallons are supporting firefighters on the ground. Three air tankers also are available for use as appropriate.

According to Inciweb, the fire burned on the interior of the perimeter Saturday, with fire activity slowly backing northwest into the Sarvis Creek Wilderness Area.

Firefighters worked to clear grasses, brush and timber that could fuel flames along U.S. Forest Service Road 100, known as Buffalo Park Road. Bulldozers and two Hotshot crews created fire line in the area of the Muddy Creek Drainage.

Grand County graders worked Sunday to open up old roads west of the Albert Reservoir. Firefighters are also connecting meadows and already burned and blackened forest areas to create additional fire lines near the Red Dirt Reservoir to protect private property.

For more information on the fire and associated closures, contact the fire information line from 8 a.m. to 9 p.m. at 307-840-9810.

Boone Draw and Three Wash fires

The Boone Draw Fire, the larger of two fires burning in western Moffat County, was reported at 8,683 acres and 40 percent containment Sunday.

The fire is burning sagebrush, grass, pinyon and juniper on private and Bureau of Land Management land north of Colorado Highway 318. The fire has closed Moffat County roads 46, 67 and 52. Colo. 318 remains open.

The fire is burning in the southwest portion of the Sand Wash Basin Wild Horse Herd Management Area. People can still view horses by accessing the basin to the north using Moffat County Road 75.

The fire threatens wild horse and greater sage grouse habitat and cultural resources.

Crews burnt out the southwestern flank of the fire Saturday, and they worked to contain the fire’s northeastern flank by clearing heavy vegetation along the fire’s edge.

The Three Wash Fire was reported contained at 369 acres at 2 p.m. Sunday.

 

Popular Hanging Lake Trail in Glenwood Canyon to close this week for repairs

The Hanging Lake Trail and parking lot in Glenwood Canyon will be temporarily closed starting Monday through Saturday, Sept. 22, and again from Oct. 15-17 for routine parking lot and trail maintenance.

The parking lot and trail closure will begin at 8 p.m. Sunday, any vehicles left in the Hanging Lake parking lot after the closure time will be subject to towing, according to a White River National Forest news release.

The Hanging Lake exit ramp will be open for vehicle turn around until 4 a.m. on Monday, and the ramp, parking lot and trail will reopen again on Sunday, Sept. 23.

Additionally, the Glenwood Canyon bike path will be closed from the Shoshone power plant to the Bair Ranch Rest Area Monday through Wednesday, according to the release.

Bikers can continue to utilize the Glenwood Canyon bike path from Glenwood Springs up to the Shoshone Hydroelectric Plant, but will need to turn around once they reach Shoshone. Bikers can also continue to utilize the bike path from the east entrance of Glenwood Canyon but will need to turn around at the Bair Ranch Rest Area.

The bike path through Glenwood Canyon will reopen on Thursday for through-bikers only, but the parking lot and Hanging Lake Trail will remain closed through next Saturday, Sept. 22, for the remaining maintenance work.

“We apologize for the inconvenience,” said Rick Truex, acting Eagle-Holy Cross District Ranger. “The closure is in place for public safety due to heavy equipment that will be operating in the area to accomplish important maintenance work.”

For hiking alternatives in the area, visit http://www.fs.usda.gov/whiteriver

Two women rescued from Mount Sopris late Saturday after getting ‘cliffed out’

Search-and-rescue crews worked late into Saturday night to help two hikers on Mount Sopris near Carbondale after they became stuck and could not get off the mountain, Pitkin County officials said Sunday morning.

Two women from the Denver area called the county dispatch at about 4 p.m. Saturday saying they were "cliffed out," cold and scared, according to Pitkin County Sheriff’s Deputy Parichat Robles.

Members of Mountain Rescue Aspen were mobilized and a Flight For Life helicopter out of Frisco was dispatched. The ground crews, who also used two ATVs, reached the hikers, ages 45 and 46, at 7 p.m. and they were on the right trail about 15 minutes later, according to the Sheriff's Office.

The women were able to give their location by using the compass app on their iPhone, according to the release. Neither hiker was injured.

The rescue consisted of 21 MRA volunteers and Flight For Life members, and all members of MRA were out of the field at 11 p.m., according to the news release.

Aspen’s bike-sharing program takes off in first free year; 50,000 rides this season

As the summer season winds down in the Roaring Fork Valley, the executive director of the country's first free bike-sharing system is taking stock in the success of the program.

WE-cycle ridership has grown significantly over past year — from 2,786 users to just over 5,000 riders. And those bicyclists took more than 50,000 rides this season, according to WE-cycle Executive Director Mirte Mallory.

This is the first year that the bike-sharing program is free. Riders can take a bike from any of the 47 stations located in Aspen or Basalt for 30 minutes for free. Every additional minute is $.50 cents.

One of the biggest trends that emerged this year is that people used the bikes as part of their daily commute to work.

In Basalt, there was a surge in the number of people who took the bikes stationed in neighborhoods and rode them to park-and-ride lots in the morning and then back home in the evening, Mallory said.

"(Our goal is to) pre-empt the car trip at the beginning and provide that hub and spoke solution," she said.

The average time a rider used a bike in Aspen was 10 minutes and eight in Basalt.

"People are riding more frequently but riding less," Mallory said, adding 97 percent of riders used the bikes for under 30 minutes this season.

She noted that there was a spike in ridership during the lunch hour in Aspen, with users taking bikes to restaurants and doing errands.

Top riders have already ridden 300 times this season and are using WE-cycle two or three times every day.

Cristal Logan, vice president and director of Aspen Community Programs at the Aspen Institute, relies on WE-cycle when she commutes from her home in Basalt to her office. She also uses it to do errands in town.

"When I do use the bus I love WE-cycle to get to the Paepcke building (on the Institute campus)," she said. "I would say WE-cycle is critical to getting to our buildings."

Logan added that the Institute has encouraged its visitors and scholars to use the bike-sharing program to get around town.

"It's amazing to see how much we can influence people who don't live here," she said.

Mallory said the nonprofit had to respond quickly to the growth in ridership. She added staff to "balance" the number of bikes at each station every day.

She estimated that the balancers moved about 100 bikes a day to ensure there were enough docked at all the locations.

Another trend that emerged was riders didn't necessarily want to do the heavy lifting by taking them to a station that involved going uphill.

To combat that, WE-cycle rolled out "rider challenges" so that if a user took five bikes back to a particular location they would receive a free cookie and espresso at Paradise Bakery.

A new challenge has been launched in conjunction with Adidas TERREX. It challenges riders to bike to uphill locations, and encourages usage in different ways. At the end of the season, winners will be awarded with clothing provided by the athletic company.

WE-cycle also has introduced on its website a valley-wide station planning map in which users can suggest specific locations, or support a suggestion.

"We are eager to hear where bike share can serve you," Mallory said. "We'll use it as a planning tool for regional bike sharing."

If voters approve a 2.65 mill levy in all eight jurisdictions in the Roaring Fork Transportation Authority's service area this fall, it will fund WE-cycle in Carbondale and Glenwood Springs in the coming years.

WE-cycle is one of the feeder services included in RFTA's 20-year plan and is a central part of helping people use alternative transportation, Mallory said.

She noted that 47 percent of ridership last year replaced car trips.

WE-cycle is partly funded by local governments, so securing multi-year commitments has allowed Mallory to offer the service for free.

The Elected Officials Transportation Committee, which is comprised of the city, Pitkin County and Snowmass Village, committed $100,000 this year and in 2019. The Roaring Fork Transportation Authority also is kicking in $100,000 annually for three years. The city of Aspen upped its contribution to $145,000 this year, and the town of Basalt and Eagle County each contributed $45,000.

Mallory said this summer's usage reiterates the notion that when bike sharing is free, simple and easy, people will use it.

"It's important for valley-wide connectivity," she said.

csackariason@aspentimes.com

Editor’s note: This story has been updated to reflect 97 percent of riders used the bikes for under 30 minutes this season.

Conservancy raises $121,550 for Lake Christine Fire first responders — to prepare for or prevent next disaster

Local firefighters and police officers didn't look for pats on the back for their quick and effective response to the Lake Christine Fire in July, but the special recognition they received Thursday will aid their missions.

The Roaring Fork Conservancy presented checks totaling $121,550 to the fire departments of Basalt-Snowmass Village, Aspen and Carbondale as well as the Basalt Police Department to share with other agencies. Rick Balentine, fire chief for the Aspen Volunteer Fire Department, said it is recognition that will be put to good use.

"Most firefighters I know, we're not big on parades," he said after the ceremony. "We don't do this for parades or accolades. It's our job. It's what we do but it certainly feels good to get recognition, especially in your hometown."

The Basalt-based conservancy holds an annual fundraising effort called the River Rendezvous. It includes a focused fundraising segment called a Paddle Raise, where funds are collected for its water quality and quantity programs. But co-organizers Sarah Woods and Judy Baum decided this year it would be appropriate to raise funds for local first responders. The Lake Christine Fire was still fresh on everyone's minds at the time of the event July 11.

"You guys were so fabulous. You saved us," said Woods, who has helped organize the River Rendezvous for 10 years.

Images of the frenetic first day and a half of firefighting are seared in the minds of many midvalley residents, said Roaring Fork Conservancy Executive Director Rick Lofaro. He recalled watching from his office window on the evening of July 3 when local firefighters scrambled to contain the fire after it broke out at the Basalt State Wildlife Area shooting range. He was among thousands of people awestruck as a DC-10 dropped slurry to protect downtown.

"We can't thank you enough. All of these people will never forget," Lofaro told the first responders.

The conservancy raised about $100,000 at the River Rendezvous and another $21,000 afterward. Alpine Bank stoked the contributions by offering the first $10,000, according to Woods.

"It was a feeding frenzy," she said. "We couldn't keep up with all the people donating for our first responders."

At Thursday's check presentation, Basalt-Snowmass Fire Department received $55,000. The fire departments of Aspen and Carbondale received $18,250 each. The Basalt Police Department received $30,050.

Police Chief Greg Knott said the contribution will be placed in a special fund overseen by a board. Law enforcement agencies that responded to the fire, and their employees, will be eligible to seek grants from the fund. That could range from equipment for an agency to aid to a responder who is facing some type of hardship, Knott said.

Aspen Volunteer Fire Department likely will use the funds to acquire equipment for wildland firefighting, Balentine said. That could include a utility terrain vehicle or enhancements for a drone, which the agency has used to help assess wildfires. A team will look at options and decide, he said.

The department sent about 20 firefighters to help with the fire. The training of the Aspen Volunteer Fire Department and the various other departments shined and their ability to work together proved invaluable.

"You train for the worst and hope for the best," Balentine said. "In this particular case, I'm very proud of our firefighters for sure and definitely everybody we worked with."

Carbondale Fire Chief Rob Goodwin said the funds for his department will be used for wildfire fighting preparation for the paid staff and volunteers.

"First of all, we're just humbled," he said.

The department sent between 20 and 22 firefighters to the Lake Christine Fire and logged more than 1,400 hours in the effort.

"We needed every one of them," he said.

He was proud of the role his firefighters played when joining their neighboring agency.

"It reinforced to me how dedicated, able and willing they are to step in," Goodwin said. "I couldn't be more pleased with the response."

Thompson said the $55,000 contributed to the combined Basalt-Snowmass Village fire departments will be used on projects that benefit the community. The fire district will offer matching grants to individuals and towns for community-minded projects, such as reducing fuels and providing water tanks for subdivisions.

Federal and state funds for fuel-removal projects have become scarce, he said. A program was funded in the mid-2000s to clear brush on the east side of the El Jebel Mobile Home Park. That mitigation helped firefighters save the neighborhood as wind-whipped flames roared downvalley the night of July 4, he said.

The Basalt-Snowmass Village department had 55 firefighters working Lake Christine for two straight days without a break.

"Everything fell into place, everybody did what I expected them to do," Thompson said.

The department has established a history of sending firefighters to other areas in the West to help with wildland firefighting when it can. That experience paid off in the Lake Christine Fire, according to Thompson.

"This is what they do. This is why we send people out to help in other regions and other forests — to gain the experience, so that when something like this happens, they know exactly what they have to do — from lighting fires, to using water to put out fires or keeping people safe," he said. "Not a single firefighter from a local community other than our dozer driver was injured. That's a testament to me that our people know how to stay out of trouble, when to back off, when to say 'no.' I preach to them that they do not risk their lives for a piece of property."

Thompson estimated that fire departments outside the Roaring Fork Valley sent 100 firefighters to Basalt and El Jebel to aid the effort. The includes agencies west of Glenwood Springs in the Colorado River Valley and east in the Eagle River Valley and Summit County.

The role of the local fire departments was critical in the first two days before a federal incident command team came in and the number of federal firefighters swelled to greater than 550.

Thompson said there have been so many fundraising efforts for local first responders, it's hard to remember them all.

At Thursday's ceremony, the fire and police chiefs received a big round of applause from onlookers at the check presentation. Balentine looked into the crowd, which included some Basalt-Snowmass Village firefighters, and motioned at them.

"These are the people who deserve applause, not us," he said.

scondon@aspentimes.com

Former city of Aspen official at Red Brick charged with four felonies

The former director of a city of Aspen nonprofit agency allegedly employed a variety of schemes to steal nearly $160,000 of taxpayer money between 2015 and 2017, according to court documents filed this week.

Some of the money allegedly taken by Angie Callen, who served as executive director of the Red Brick Council for the Arts, went into a snowboard company she owned with her husband that a co-worker told investigators was losing money and "a total failure," the documents state.

However, an arrest warrant affidavit filed Monday in Pitkin County District Court also details "extraordinary personal spending on food, hotels, airplane flights, fly-fishing trips and skiing excursions, including an unidentified $18,250 charge in Snowmass Village."

Callen, 37, was charged with four felonies — theft, committing a computer crime, identity theft and embezzlement of public property — in the arrest warrant signed Monday by District Judge James Boyd.

She has not yet been arrested on the charges, and did not return a phone message Tuesday seeking comment.

Callen was fired in June 2017 after the Red Brick's operations manager forwarded information to the president of the nonprofit's board about the alleged theft, the affidavit states. The board president later told an investigator from the District Attorney's Office that she confronted Callen about the allegations the next day.

"Callen immediately admitted to stealing the funds and was 'remorseful and cried,'" the president told investigator Jeff Fain. "Callen told them that she had kept a list of everything that she had stolen and it totaled $114,000.

"She stated that when she had first written a check from the Red Brick accounts to her company Bomber for $10,000 that she intended to pay it back, but that never occurred."

At one point in the investigation, a local lawyer approached Aspen City Attorney Jim True with an offer from Callen: $150,000 in exchange for dropping the criminal case, according to the affidavit. That local lawyer, Lawson Wills, declined to comment Tuesday on that offer or if he still represents Callen.

Callen allegedly embezzled $101,988 from one Red Brick-related bank account and another $57,301 from another, for a total of $159,289, according to the affidavit.

The scheme that allegedly netted Callen the most money involved an online small business loan company called Kabbage, the affidavit states. She applied twice to the company for loans for her company, Bomber Industries, which makes hard boot snowboarding equipment, but was denied both times.

Then she applied to Kabbage as "owner" of the Red Brick Center for the Arts and received four loans from the company in 2015, 2016 and 2017 for a total of $60,000, according to the affidavit. In all four cases, Kabbage deposited the loans into a Red Brick account and the money was transferred by check into Callen's personal accounts.

In three of the four loans, Callen wrote herself checks in the amount of the loan before Kabbage even deposited the money, the affidavit states. In the case of one of the loans, the signature on the back of the check depositing the funds into a Bomber account "likely belongs to her husband James Callen," according to an examination of the couple's bank records noted in the affidavit.

No charges have been filed against James Callen.

The Kabbage loans were paid off on a monthly basis using funds from Red Brick accounts, according to the court documents. An outstanding balance of $19,424 remains on those loans, which were secured using Red Brick financial information.

Payroll advances were another source of Angie Callen's alleged theft, according to the affidavit. For example, she was supposed to make $61,000 in 2015 but collected $71,500, while in 2016 she was due $65,000 in salary from the city but cashed $81,677 in paychecks. She overpaid herself by about $38,800, the affidavit states.

In fact, by the time she was terminated in June 2017, Callen had already paid herself $11,622 for future pay periods between Oct. 15 and Dec. 31, 2017, according to the affidavit.

Finally, Callen opened a Red Brick credit card no one else at the nonprofit knew about. She used Red Brick accounts to make more than $35,000 in payments on that card. Expenses recorded on that card included nearly $25,000 in payments to Bomber Industries, the affidavit states.

The city of Aspen owns the Red Brick Center for the Arts at 100 Hallam St. and serves as landlord to several nonprofit organizations housed there. The Red Brick Council of the Arts had a management contract with the city to run the agency, though the city's Parks and Recreation Department has taken over management of the building since Callen's firing.

Callen and her husband declared bankruptcy in November, noting a $210,000 debt to a Silverthorne businessman who sold two divisions of Bomber to the Callens in 2015 and 2016 was a major factor in the filing.

jauslander@aspentimes.com

Aspen School District stands behind HR director disbarred in Missouri

The Aspen School District's superintendent and school board president are standing behind a high-ranking administrator disbarred in April by the state of Missouri for purportedly engaging in professional misconduct as an attorney.

Elizabeth Hodges is entering her third academic year as director of human resources for the school district. Her job involves working with staff members on benefits, salaries and the district's employee policies, among other duties. Hodges, who will draw a annual salary of $132,345 for the 2018-19 school year, also is on the front line of screening job candidates with background checks, and has access to a number of details about the school district's 250 to 265 employees — from bus drivers to teachers — including their Social Security numbers and other personal information.

The job does not involve her working in the capacity as a lawyer, Hodges and school officials said.

It was not until July, however, that at least two school district authorities — Superintendent John Maloy and Sheila Wills, chair of the Board of Education — learned that Hodges was stripped of her law license because of her work in 2014 on an estate and will for an elderly Missouri couple. That same work led her to plead guilty to a misdemeanor charge of deceptive business practice and also resulted in a $1 million court judgment for what a judge called "self-dealing."

Maloy and Wills insisted that revelations about Hodges' past, for which they also said she underwent a thorough background check, isn't relevant to what they called a fine job performance so far. In interviews earlier this month, the two also expressed sympathy and empathy over what Maloy called a "burden on her shoulders," while Wills said Hodges' past "has absolutely nothing to do with her job" as human resources director.

"I have never seen Elizabeth do anything that was either incompetent or unethical," Wills said.

Maloy also declined to say whether the school district has disciplined Hodges, because it is a personnel matter.

Hodges, 36, in an interview with The Aspen Times on Aug. 8, said the narrative from court documents fails to accurately or thoroughly portray what transpired during her estate planning for the couple, and it has no bearing on her current job with the school district. She also noted the Missouri Supreme Court's decision to disbar her, as well as a seven-figure judgment against her, were one-sided, default decisions that were the result of her deciding not to present her own evidence nor state her case.

Hodges said her work for the couple, both of whom died within two weeks of each other in late July and early August of 2014, came from a place of honesty and kindness.

"I got nothing from these gentlemen except for the love and companionship they offered me," she said. "So I know I did right by them, every step of the way."

Hodges did not reveal her ongoing legal problems to the school district, which she initially joined in early 2016 by shadowing retiring HR director Ginny Haberman with an understanding that she would have the opportunity replace her that summer.

"I didn't because it didn't have any effect on what I was doing here," she said. "It was a personal little misdemeanor thing, like a DUI situation, so it didn't seem to me to be of any importance to anybody."

On the record

Federal and state court documents from Missouri and Garfield County portray Hodges as a lawyer who took advantage of a couple as their estate planner.

On April 24, the Missouri Supreme Court ordered the disbarment of Hodges. According to a ruling from the chief disciplinary counsel, Chief Justice Zel Fischer, there was "probable cause" to believe Hodges was "guilty of professional misconduct."

Fischer's order also said "Elizabeth A. Hodges is hereby disbarred, that her right and license to practice law in the State of Missouri is canceled and that her name be stricken from the roll of attorneys in this state."

The default order was a result of Hodges' failure to respond to the allegations against her. Hodges said she didn't have the money to fight the matter.

"It was going to cost a fortune," said Hodges, who received her law degree in 2010 and a master's degree in tax law in 2011 from the University of Missouri-Kansas City School of Law. "I don't have the money. I didn't have $20,000, $30,000, $40,000, $50,000 to have an attorney to handle it."

Representing herself, Hodges said in a second interview Tuesday, also would have done no good because she was ethically bound not to disclose her attorney-client relationship with the couple. Hodges said she has started a process to have her law license reinstated.

Because she didn't contest the allegations, Hodges said the Supreme Court's default judgment doesn't truly reflect the estate planning she performed for the couple that led to her disbarment.

The Missouri high court's order does not include the allegations behind its decision, but a judge's harshly worded order in a separate case, which was delivered Nov. 29, 2016, in the probate division of the Circuit Court of Clay County, Missouri, outlines what landed Hodges in trouble. That order was the result of a case brought on against Hodges by the Estate of Joseph Z. Zaiotti a year earlier, in November 2015.

Hodges, as an attorney for Kansas City, Missouri, couple Zaiotti and Donald Beasy, executed the couple's will and named herself as the beneficiary of whatever possessions they left behind, according to the judgment. The will was executed June 15, 2012, and the couple's prior wills were revoked, the judgment said.

By doing so, "Defendant engaged (and) breached her fiduciary and engaged in self-dealing with the assets of Mr. Beasy and Mr. Zaiotti," wrote Judge Larry D. Harman in the order.

Hodges said she knew nothing about the newer will naming her the beneficiary.

"I found out after they died that they had left me everything in their wills," she said. "They weren't the same wills I had drafted. I knew when I saw them that I was devastated. Because I knew what that meant. And they were trying to do it to be kind, and I didn't know when they did it. … I knew when I saw it that it was the kiss of death.

"I disclaimed the estate entirely because I didn't want there to be any misconception that I wanted anything from these gentlemen. They were friends and loved ones and that's what it was, so I disclaimed the estate and tried to move on with my life."

She added, "Under no circumstances would I ever do that (sign the will making her the beneficiary)."

Kia sale led to criminal charge

Another aspect of Harman's judgment in the estate case was Hodges' selling the couple's Kia vehicle to a dealership for $14,000 on Aug. 11, 2014 — which came after Zaiotti died Aug. 9 and Beasy on July 30. Hodges was able to collect the money by showing the dealership the powers-of-attorney that Zaiotti and Beasy assigned her, though she "knew that the Powers of Attorney executed by Mr. Zaiotti and Mr. Beasy were no longer valid after their deaths," the judge's ruling said, noting the act was fraudulent.

Still acting as the deceased couple's attorney when probate proceedings began, Hodges filed documents saying the couple had combined assets totaling nearly $215,000.

"Neither inventory reflected the 2014 Kia Soul nor the proceeds from the sale of said automobile," the order said.

The Kia sale also led a Kansas City grand jury to indict Hodges in February 2016; by that time she was working for the Aspen School District. She was notified of the indictment that May and pleaded guilty in December to deceptive business practice, a misdemeanor. The court ordered Hodges to pay $14,000 in restitution and placed her on probation for two years. Hodges remains on probation through December, according to court files.

Meanwhile, upon learning Hodges had sold the vehicle, Zaiotti's relatives filed a complaint in Clay County's court system in November 2015. Hodges' counsel at the time initially filed an answer in January 2016, but Hodges did not answer the plaintiff's further request for discovery responses and did not appear for a deposition.

The judge's order noted that Hodges "deliberately disregarded" the court's order to respond in the case, and her actions "in her dealings with Mr. Beasy and Mr. Zaiotti were reprehensible" and her actions "were outrageous because of Defendant's evil motive, reckless indifference and conscious disregard for the rights of others."

The judgment on two counts amounted to $614,000 along with $378,000 in punitive damages, along with attorney and legal fees.

For her part, Hodges said it was her understanding that a November hearing that she planned to attend had been canceled, and that's what triggered the default judgment.

She also provided The Aspen Times with court records showing a stipulation of the dismissal of the case, which Hodges signed and purportedly had been signed by Steven Petry, the attorney for the court-appointed personal representative of the Zaiotti estate.

"There's a signed stipulation of dismissal," Hodges said.

In an affidavit dated filed Feb. 22 of this year, however, Petry said, "I did not prepare nor did I sign any Stipulation of Dismissal in connection" with the case.

The affidavit also accused Hodges of fraudulently crafting an email, using Petry's name, notifying Hodges the court date had been canceled while in actuality it had not.

Hodges called Petry a "snake in the grass" who lied in the affidavit, adding that she is pursuing avenues to have him disbarred.

Speaking Wednesday, Petry said the judgment still stands.

"As far as our action here, it was resolved with a judgment," Petry said. When told how Hodges characterized him, Petry replied, "I'm sure she did."

He also maintained he did not sign the stipulation for dismissal, adding it would be "strictly a guess" as to whom allegedly forged his name.

Vindictive heirs?

The web of litigation also spurred Hodges to declare personal bankruptcy in February, which for now shields her from paying the judgment. Claims of bankruptcy fraud against Hodges also are part of the case file.

"I don't have any money from this estate," Hodges said. "But they won't take 'no' for an answer. Instead they just want to torture me … it's taken a toll."

Said Petry: "We have no knowledge (where the money is). We really don't, because there really wasn't a paper trail to follow any place."

The order from Harman, the judge in the probate case, notes that Zaiotti and Hodges leased a safety-deposit box on Aug. 1 — two days after Beasly died. Hodges, by herself, accessed the safety box on Aug. 1, 4 and 7, the order says. In the meantime, Zaiotti was hospitalized Aug. 1 and told a hospital worker that he and Beasy had assets of $600,000, according to the judgment.

Hodges said the $600,000 judgment was based on hearsay between Beasy and the hospital worker, and the monetary figure was overblown by the court.

Through Carbondale attorney Adrienne Rowberry, a filing by Hodges in her bankruptcy case also claims that Zaiotti's "modest estate" was disclaimed by Hodges and was distributed to his relatives.

The bankruptcy also has stalled additional proceedings in Garfield County District Court, where a local attorney is trying to recoup the judgment — which has now surpassed $1.1 million because of interest — through what's called a "foreign-judgment" process.

"I look at this case, and I see a person who made a sizable mistake in her life," said Aspen attorney Andrew Quiat, who is representing Zaiotti's estate in the Garfield case. "I'm sure she can overcome it, and that's why we've filed suit to recover on the judgment they obtained against her in Missouri."

Hodges insisted that she has been the victim of a campaign of harassment and hate orchestrated by certain heirs of the estate who are trying to collect the seven-figure judgment from her. The vindictiveness, she said, is spurred by homophobia. Hodges is gay and the deceased couple she befriended had a same-sex partnership for more than 50 years.

"It has a lot to do with the fact that I'm gay and the two gentlemen were gay," she said, adding "their families weren't going to recognize them as a couple together" and she took it upon herself to spread their ashes in Gulf Shores, Alabama.

The family's lead plaintiff in the case, Margaret Mary Prebich of Minnesota, declined to comment for this story because the family maintains the court record speaks for itself, Quiat said.

How she was hired

Superintendent Maloy said Hodges impressed him during the interview process and transition period. She also won over the board of education, which approved Maloy's recommendation to hire her.

"She just appealed to us in terms of being honest, open, direct and being a people person," he said. "And obviously, dealing with human resources, it's many of the qualities that we needed. "

Hodges said she learned about the school district's job opening in human resources, through mutual friends and online, in 2015. She and her wife had visited Aspen and enjoyed the area, she said.

The resume Hodges presented to the school district showcased her work as an attorney, from her admittance to the Missouri bar in 2010 as well as two firms she was running at the time — the Hodges Law Group and Hodges Real Estate Group — both of which she started in October 2010 and July 2012, respectively. According to the resume, which The Aspen Times received through a request to the school district, Hodges also ran the human resources department for a Kansas City law firm prior to obtaining her law degree.

Hodges was practicing law in Missouri before she joined the school district. Her legal experience in labor relations also complemented her career change, Maloy said.

Both Wills and Maloy learned about the disbarment last month through an anonymous letter they received, which included the disbarment order. At least one of the envelopes to the school district included The Aspen Times on the return address. The Aspen Times also received an anonymous letter in July with no return address but a St. Louis, Missouri, postmark. The letter identified the writer as a "concerned parent."

Wills, who attended the Times interview with Hodges on Aug. 8, defended Hodges and said "she doesn't do anything that requires a law license." Wills said she reached out to school board members but they had not met over the summer to discuss Hodges' situation.

The school board president also said she didn't give credence to an anonymous letter that appeared to come from someone out to hurt Hodges, who said the letters came from vindictive relatives of Zaoitti.

"This was created to paint Elizabeth in the worst possible manner," Wills said. "And if you want to come in and have a dialogue with me or anyone within this district about information you feel like would harm our children, I certainly would be the first one to stand up and say, 'Let's hear it.' … But I don't believe that was the purpose of this letter."

rcarroll@aspentimes.com

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