LeFever Mattson Bankruptcy News
The LeFever Mattson company and 58 affiliated companies (known as the “Debtors” in bankruptcy documents) filed for bankruptcy in September 2024. Note that KS Mattson Partners, owned by Ken & Stacy Mattson, is was not originally a part of the bankruptcy proceedings of LeFever Mattson; however, at the request of LeFever Mattson, the bankruptcy court to forced KS Mattspon Partners into bankruptcy on June 9th, 2025. Ken Mattson as an individual has also agreed to go into bankruptcy.
******
The Official Committee of Unsecured Creditors was appointed by the court in October 2024. On May 15, 2025, a document was filed with the bankruptcy court titled Stipulation Granting the Official Committee of Unsecured Creditors Standing to Pursue Estate Causes of Action Against Socotra Capital, Inc. and its Affiliates.
https://veritaglobal.net/lm/document/5910545250518000000000001
Socotra Capital, Inc. provided a number of loans on the properties purchased by LeFever Mattson and KS Mattson Partners (KSMP). Socotra filed 13 proofs of claim, asserting more than $100 million in secured claims against LeFever Mattson companies.
The Official Committee of Unsecured Creditors "has discovered, among other things, that: (a) the relationship between the Debtors and Socotra spans more than a decade; (b) Socotra would routinely lend money to non-debtor KS Mattson Partners, LP to purchase or refinance real estate, which real estate would then be transferred to the Debtors at inflated prices and subject to Socotra’s loan;"
"For at least 19 of those properties, a Debtor first held fee ownership, but then Mr. Mattson would (a) cause the applicable Debtor to transfer the real estate to KSMP; (b) encumber the real property with the Socotra Loan; and (c) transfer the real estate back to the Debtors—often in a matter days or even hours."
The Committee has asked the court for the “Committee to be granted leave, standing, and authority to, in consultation with the Debtors, (a) investigate, assert, prosecute, and/or settle estate claims and causes of action against Socotra”
******
On April 2,2025 there was a town hall for LeFever Mattson investors. At that time anyone who wanted to hear what is going on with the LeFever Mattson bankruptcy and investor claims could also register and attend this Zoom presentation.
The picture painted by the attorneys handling the LeFever Mattson bankruptcy, forensic accountants and real estate professionals, is one of great complexity. The work they are doing has taken a long time and there is still more to do. The goal of all of these professionals is to document all investor claims and dollar amounts, to trace and catalog all of the money flowing into and out of LeFever Mattson’s account, and to freeze and hold all assets and funds so that those that have lost money can be reimbursed as fully as possible. They are still investigating if it is a Ponzi scheme or not. Analysis of the main bank account indicates Investor funds are commingled. Investors were advised to file a tax extension, as LeFever Mattson is delaying sending out tax documents that report investor’s income.
At this point they project that a distribution plan will be ready late summer or early fall.
Pineapple Bear, doing business as Sonoma’s Best Hospitality Group runs the hospitality businesses, including Depot Hotel Restaurant, 7 Branches, and the General’s Daughter, an Inn to Remember, and the Cornerstone event business. LeFever/ Mattson as Pineapple Bear has and continues to draw money out to keep the hospitality businesses up and running. They have long operated at a loss, and the money to cover this may have come from the pool of money supplied by the investors. LeFever Mattson has asked the bankruptcy court to continue subsidizing Pineapple Bear’s hospitality businesses, arguing that closing down Pineapple Bear would damage the reputation of the businesses and reduce the value of the properties where Pineapple Bear is doing business. As of April 15, 2025 LeFever Mattson has loaned Pineapple Bear $1.5 million.
As LeFever Mattson continues to draw money from the pool of funds in the bankruptcy proceeding, it decreases the amount of money that can be repaid to the investors. The best case scenario for these businesses is if the buyers of the property that the businesses reside in also purchase the businesses, as Chris Fannini has for the Cheese Factory and Sonoma’s Best Deli and Cottages.
KS Mattson Partners owned is by Ken & Stacy Mattson and is not a part of the bankruptcy proceedings of LeFever Mattson. The major issue is to force KS Mattson also into bankruptcy, so that the courts can oversee these funds and assets as they are doing for LeFever Mattson funds and assets and assure that Ken and Stacy Mattson do not use and deplete these funds until all the investors and others owed money are repaid. At this point Ken and Stacy Mattson as the sole owners of KS Mattson could take money from the KS Mattson funds and assets as they are not under the supervision of the bankruptcy court. For instance KS Mattson could sell property and keep and spend the funds, even though this money is owed to investors or other parties.
This latest article by Phil Barber in both the Santa Rosa Press Democrat and the Sonoma Index Tribune, provides in-depth detail on the LeFever Mattson and KS Mattson saga.
https://www.sonomanews.com/article/news/ken-mattson-sonoma-real-estate-fbi-investigation/
https://www.pressdemocrat.com/article/news/ken-mattson-sonoma-real-estate-fbi-investigation/