Former Oregon first lady Cylvia Hayes announced today in a Facebook post that she will seek protection in bankruptcy court rather than pay The Oregonian court-ordered legal fees that resulted from her refusal to turn over emails the newspaper had requested.
"This is a very difficult decision," Hayes wrote. "I have struggled with it, sought counsel, soul-searched, meditated and prayed about it. Prior to all of this my only debt was my mortgage—no credit card balances, school loans were paid off and my car was paid in full (the same car I am driving today). I have never failed to pay off a debt and never imagined I would be in bankruptcy."
Back in 2014, The Oregonian requested Hayes' emails, arguing that they should be public record as she regularly participated in policy discussions in her capacity as first lady and advisor to then-Gov. John Kitzhaber.
Hayes refused. A Marion County Circuit Court judge later found in The Oregonian's favor and ordered Hayes to paper the paper's attorney's fees, which totaled nearly $128,000.
(In the meantime, Kitzhaber resigned in February 2015 under pressure from an influence-peddling investigation that resulted from reporting by WW.)
Hayes appealed the court decision's against her. While waiting for a ruling on the appeal, The Oregonian filed a lien on Hayes' home in Bend as a way to protect its claim against her, a move the Columbia Journalism Review reported was unusual.
In her Facebook post, Hayes says she's decided to drop her appeal and, rather than pay the daily, file for bankruptcy protection.
As she does that, Hayes also faces potential fines of up to $110,000 for violations of state ethics laws. The Oregonian reported Wednesday both that Hayes is planning to file bankruptcy and that she's negotiating a settlement of the fines.
Although seeking court protection may help Hayes avoid paying The Oregonian, a bankruptcy attorney who is not involved in the case says that under Section 523(a)(7) of the Bankruptcy Code (fine/penalty payable to governmental unit), Hayes may not be able to use a bankruptcy filing to avoid paying ethics penalties.
The ethics commission is next scheduled to meet on June 29.