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In shift, Bilzerian sues neighbor

Often sued by creditors, Bilzerian is suing a Minnesota neighbor for harassment.


© St. Petersburg Times, published October 3, 1998

TAMPA -- Famed corporate raider Paul Bilzerian is no stranger to courtrooms. Time and again, creditors have gone after the Tampa resident, trying to prove he hid millions of dollars in assets before declaring bankruptcy in 1991.

But in a lawsuit filed this week in federal court in Tampa, Bilzerian and his wife are the plaintiffs. They are suing a woman who owns property near their $1-million summer home in Crosslake, Minn., claiming she is harassing the couple and trying to extort money from them.

Bilzerian and his wife, Terry Steffen, claim neighbor Marsha Schoeb is angry because they won't buy her small tract of land, which includes a garage and warehouse and is surrounded by the couple's property. According to the lawsuit, the land is worth $65,000; Bilzerian says Schoeb wants $400,000.

On several occasions, according to the suit, Schoeb said that if she didn't get the desired amount "she would become a private nuisance and inflict great emotional and mental distress on Steffen and Bilzerian and their children . . . Schoeb stated to Bilzerian that she hoped he would die soon so that she could deal with Steffen."

In the lawsuit, Bilzerian also accuses Schoeb of polluting the area, wearing "highly offensive and inappropriate attire," allowing her dog to roam Bilzerian's property and having "unauthorized and unseemly public garage sales."

Schoeb, listed in the complaint as a resident of Glendale, Ariz., could not be reached. Bilzerian did not return calls for comment.

Bilzerian made millions in the 1980s as a takeover artist, but then his business dealings went sour. Before he declared bankruptcy, he transferred his 37,000-square-foot home in the exclusive Avila area of Tampa to his wife's name, along with the Minnesota property.

Bilzerian became a symbol for critics of the nation's bankruptcy laws; he and his Tampa house were even featured on 60 Minutes. The lakefront Avila estate, which at the time of the bankruptcy filing had 11 bedrooms, 21 bathrooms, an indoor basketball court and a movie theater, was assessed at $4.8-million last year.

But some creditors have not given up. One, the Securities and Exchange Commission, won a ruling last month that allows the agency to try to collect a $33-million penalty. Whether the SEC will get any of it is another matter: Since serving 20 months in prison for securities fraud, Bilzerian has maintained that he is essentially broke.

Bilzerian, who is representing himself in this latest legal dispute, is seeking compensatory damages, punitive damages "in a sufficient amount to punish Schoeb," attorney's fees and court costs.

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