Green Power CEO of Kennewick set to be arraigned on new charges

Kristi Pihl, Tri-City HeraldJune 14, 2014 

Green Power Sun

The Port of Pasco is evicting Green Power, a tenant since 2007, from the Big Pasco Industrial Park.

PAUL T. ERICKSON — Tri-City Herald Buy Photo

Green Power CEO Michael Spitzauer is asking a federal judge to grant him bail after six months behind bars.

But federal prosecutors say Spitzauer remains a flight risk.

Spitzauer, of Kennewick, is set to be arraigned Wednesday on new charges filed against him in U.S. District Court in Yakima. Magistrate Judge James P. Hutton will hold a bail review hearing at the same time.

Federal prosecutors recently amended the indictment against Spitzauer to add bank fraud, filing a false tax return and additional instances of wire fraud. He was already charged with wire fraud, aggravated identity theft and money laundering.

Spitzauer was transferred in April from federal custody in Yakima to the Benton County jail so he could see a specialist at Kadlec Regional Medical Center for neck pain, documents said. The doctor determined a lump was not cancerous but recommended that it be removed.

Since that doctor was not a surgeon, officials found a surgeon at Lourdes Health Network who could see Spitzauer, documents said. That doctor requested a CT scan so he could get a complete picture of the lump. That test happened earlier this week.

Spitzauer asserts he should be able to have surgery at Kadlec instead of Lourdes and is trying to claim federal marshals are trying to avoid having to pay for surgery, documents said.

He also argues that he should be released so he can recover at home after surgery, but federal prosecutors say that neither physician has recommended he recover at home instead of in jail.

Spitzauer has remained intimately involved in Green Power, the troubled Pasco biofuels company he founded, while in jail, prosecutors say. They describe his supposed lack of control as a "farce."

While incarcerated, he spoke with acting CEO Judith Calhoun on the phone 54 times during a recent six-week period.

"Spitzauer and Judith Calhoun regularly discuss and he gives direction on Green Power related matters, such as business transactions and bankruptcy proceedings," prosecutors wrote in court documents.

During the same weeks, Spitzauer also made 21 calls to one of his alleged victims. In March, while in custody, he apparently negotiated an agreement with that alleged victim which Spitzauer's wife then signed, according to court documents.

In the meantime, Calhoun has arranged for an attorney and insurance for Green Power's bankruptcy case, which has halted efforts by Tri-City creditors to foreclose on the company's unfinished Pasco plant.

A judge dismissed the company's first bankruptcy filing earlier this year.

Calhoun says in court documents that she filed the most recent bankruptcy case so Green Power can be sold. She previously told the Herald that the buyer is Atlantis Renewable Energy Systems, a company she recently incorporated.

But now Green Power is being sold to a different company for $12 million, Calhoun said in court documents. She redacted the buyer's name from the documents she filed with the bankruptcy court, claiming she was doing so because of "inaccurate newspaper reporting."

However, Peter Gawain, whose signature is on the new purchase and sale agreement, also is a manager of a company that owned Atlantis Renewable Energy Systems, according to court documents filed by Calhoun during her first attempt at bankruptcy protection and documents filed with the Arizona Corporation Commission.

Together, Green Power and Spitzauer owe about $36 million, including interest, to about 40 creditors, according to court documents.

Calhoun identified about $14.8 million in debts but claims most of that is disputed. The company's list of creditors as reported by Calhoun includes three of the companies Michael Spitzauer is accused of defrauding, as well as companies that have civil court judgments against Green Power.

-- To submit business news, go to bit.ly/bizformtch.

-- Kristi Pihl: 509-582-1512; kpihl@tricityherald.com

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