By Heather Clower
The Parsons Advocate
On Tuesday, April 30, in United States Bankruptcy Court in the Eastern District of Pennsylvania, Frederick Herz, Tracy Edmonds Herz, and Dr. Frederick Reichle filed for Chapter 11 bankruptcy. The party did so on behalf of three entities including Timberline Four Seasons Resort Management Company, Long Run Realty, and Herz, Herz, and Reichle. Chapter 11 bankruptcy is defined as a reorganization of a debtor’s business affairs, debts, and assets. This form of bankruptcy is known for giving the debtors a fresh start.
In December of 2018, F. Herz was arrested by the Tucker County Sheriff’s Department and charged with twelve misdemeanors counts of failure to pay hotel/motel tax. F. Herz spent time in Tygart Valley Regional Jail before being released. He is still facing these charges and is scheduled soon to appear back in court.
In March of this year, the West Virginia Public Service District appeared before the Honorable Judge Lynn Nelson requesting Timberline Four Seasons Utilities (TFSU) be placed into receivership of the Canaan Valley Public Service District (CVPSD). The PSD successfully argued it would be in the best interest of the customers of TFSU, as well as its employees, to place management responsibilities under the control of someone other than that of the Herzes.
Just last month, F. and T. Herz again came to Tucker County Circuit Court, this time in front of the Honorable Judge James Courrier. In February of this year, The Tucker County Sheriff’s Department served the Herzes official notice of a Recommended Decision filed by Prosecuting Attorney Ray LaMora requesting that, in addition to the Timberline Four Seasons Utilities (TFSU), that is now in receivership of Canaan Valley PSD, that the entities of Timberline Four Seasons Resorts Management, consisting of Fred and Tracy Herz, Rose Marie Herz, Frederick Reichle, Long Run Realty, and Timberline Four Seasons Realty be placed into receivership as well. At the conclusion of this hearing, Judge Courrier found it necessary to grant the Herzes an extension until May 28, giving them opportunity to secure council in regards to this matter. If at that time they do not have legal representation, Courrier will continue with hearing the testimonies from witnesses gathered by LaMora and will make a ruling on the case.
Of the entities currently in and requested to be placed into receivership of a qualified group or individual, three of them have now filed for bankruptcy. It is believed the reason it was filed in Pennsylvania versus West Virginia was due to the fact Reichle, resident of Pa, is the majority shareholder of the entities. Lists of creditors involved in these entities have already been submitted and a meeting with those creditors has been scheduled for June 13 at 2 p.m. with United States Trustee George Conway or a representative. The Honorable Judge Fitzsimon will be presiding over the case and the three entities will be represented by Attorney Albert Ciardi.
In addition to these three Chapter 11 filings, Reichle himself filed for Chapter 13, defined as a form of bankruptcy where the individual proposes a repayment plan to invested creditors to be fulfilled in a three to five year timeframe. On February 7, 2019, the physician found himself amidst 13 others being indicted in a multitude of crimes including “conspiracy to dispense and distribute controlled substances outside the course of professional practice and without a legitimate medical purpose; distribution of oxycodone; health care fraud; and maintaining a drug-involved premises,” according to a press release by the Department of Justice U.S. Attorney’s Office Eastern District of Pennsylvania. According to this press release, the first charge against Reichle and others involve maintaining drug-involved premises. The doctors and physicians assistants of AUC allegedly offered a “pain management” program to the public and offered oxycodone for a fee. The second charge against Reichle and another physician, Dr. Soss, is for conspiracy to distribute and dispense oxycodone outside the usual course of practice and not for legitimate medical purpose.
As of the time of the call to the court, Reichle has yet to submit his list of creditors; therefore, no meeting with Trustee Scott Waterman has been scheduled. The Herzes are still scheduled to appear before Judge Courrier May 28, with or without an attorney, so Courrier can continue with the request to place the remainder of the entities associated with Timberline into receivership.