Things took a testy turn Thursday at U.S. Bankruptcy Court when lawyers for the estate of country singer Don Walser called investor James W. Heldt to the stand.
Heldt was a major shareholder in three corporations being sued by Walser's four grown children on charges of fraud, breach of contract and breach of fiduciary duty.
At one point in the questioning, plaintiffs' lawyer Broadus Spivey asked whether Heldt had paid from his personal account to settle sexual harassment charges brought by former Antone's Records president Christie Warren. That brought Heldt's attorney, James Landon, to his feet in objection.
"It's obvious that you're just out to hassle this witness," Landon said.
Bankruptcy Judge Craig Gargotta also threw up his hands, saying, "Come on!" and questioning the relevance of that question and others.
Spivey answered that he wanted to establish the co-mingling of funds, which would strengthen his effort in the trial to make Heldt liable for the actions of the music-related corporations he funded to the tune of about $3 million from 1998 to 2005.
Heldt eventually answered that two checks to Warren — one for $44,000 and the other for $18,000 — were simply her severance package.
Walser filed the suit against Texas Music Group, Antone's Records and Texas Clef Entertainment in 2005 but died the next year. Those three corporations, of which Heldt said he owns about 65 percent each, filed for Chapter 11 bankruptcy protection in November 2008. The Walsers also have sued individuals Heldt, Randolph Clendenen and Heinz Geissler, who ran the labels.
Heldt said that he paid his friend Clendenen $120,000 a year to run the labels, which bought the catalog of Watermelon, Walser's old label, in a 2001 bankruptcy reorganization plan.
The Walser family contends that the singer received a small fraction of the money earned by his records over the years. Al Walser and his sister Jane testified that their father was forced to perform after suffering strokes and being diagnosed with neuropathy because he had very little income aside from Social Security and pension checks. "Was his poor health visible to others?" Spivey asked. "Painfully so," answered Al Walser.
The plaintiffs are asking for damages, a full accounting of royalties owed and the dissolution of the contract their father signed with Watermelon in 1994.
The non-jury trial could end as early as today.