The Montana Supreme Court held hearings in Kalispell last week in what University of Montana law professor Martin Burke called an opportunity for Montanans to learn about the court.
The justices heard oral arguments for two cases on Sept. 16, one of which included former congressman and Republican hopeful for governor Rick Hill, as part of the State Bar of Montana’s 37th Annual Meeting, held at the Red Lion Hotel.
Hill and his wife Betti are part of a group of securities purchasers whose real estate deal fell apart once the housing crisis hit the country several years ago. The securities were supposed to garner monthly payments, but payments stopped in November of 2008 after Idaho-based investment company DBSI went bankrupt.
The investors accused DBSI of fraud in a billion-dollar class action lawsuit, alleging that the company was bilking money intended for investment in real estate and using money from new investors to pay dividends to earlier investors, according to The Associated Press.
The group is asking the Supreme Court to overturn a District Court order compelling them to participate in arbitration rather than taking the issue to trial. As part of the investment, all investors signed agreements requiring arbitration if disputes arose.
The investors would like the court to nullify the arbitration agreement, but the company argues the agreement should stand.
According to the Montana Securities Commissioner office, 80 investors in the state have about $32 million involved in the deal. Hill and his wife allege damages of $2.4 million.
During the oral arguments, attorneys for both sides referenced a recent U.S. Supreme Court decision – AT&T Mobility LLC v. Concepcion – that could affect arbitration determinations in this case.
Flathead District Court Judge Ted O. Lympus sat with the justices during the hearing, replacing Justice Jim Rice, who recused himself.
The Associated Press contributed to this report.