The trustee in one-time property developer Seán Dunne's US bankruptcy is fighting an attempt by Mr Dunne's wife, Gayle Killilea, to block examination of one of her closest financial advisers.
Lawyers for the trustee, who is charged with distributing Mr Dunne's assets to his creditors, want to question Dublin accountant James Ryan about Killilea's wealth to identify funds to pay €18.1 million a US jury awarded the estate in June. They are also seeking a wide array of the couple's financial documents, including tax returns and bank records.
Jurors ordered Ms Killilea to pay the money after listening to three weeks of testimony and concluding that Mr Dunne had fraudulently conveyed millions of euro in assets including Walford – once Ireland's most expensive home – to her to evade creditors.
The trustee's lawyers last month obtained an order from US Bankruptcy Court in Bridgeport, Connecticut, allowing them to question Mr Ryan and obtain documents.
In response Ms Killilea’s lawyer asked the judge in Mr Dunne’s civil trial, which took place in US District Court in New Haven, Connecticut, to intervene and issue a protective order blocking Mr Ryan’s examination and production of documents.
Attorney Peter Nolin, who declined to comment on Wednesday, dismissed the trustee's action as an attempt to circumvent discovery and improperly ask Mr Ryan about matters protected by attorney-client privilege. He wrote he could not challenge the order in bankruptcy court because it has ruled his client lacks "standing", a direct interest in the case. He further noted that the trustee could have examined Mr Ryan before the trial but didn't.
In an objection filed this week, trustee attorney Timothy Miltenberger, who did not return a call seeking comment, called the protective order request "improper" and "baseless". Mr Miltenberger said Mr Nolin is conflating discovery before trial with identifying assets to pay the judgment after trial, which the trustee has a duty to do. Mr Nolin should raise his objections in bankruptcy court instead of asking the trial court to intervene, he wrote. The trustee, the objection says, will not ask Mr Ryan anything related to attorney-client privilege.
“All of this information will be accumulated with an eye towards liquidating a potential judgment in favour of the trustee and against Ms Killilea,” Mr Miltenberger wrote. “The trustee anticipates examining Mr Ryan about assets – the what, when, who, and how much of Dunne’s and Killilea’s financial affairs.”
In addition to the issue, US District Judge Jeffrey Meyer still has to rule on the trustee's request that he find Mr Dunne's wealth transfers unjustly enriched Ms Killilea and more than double the award to €43.3 million.
A court-sponsored attempt to settle the case failed in July. The court has scheduled another mediation session for later this month.