MISSOULA, Mont. -

Federal court documents indicate a Ravalli County community leader has filed for bankruptcy protection for himself and a company he operates called Human Interactive Products, Inc.

Court documents indicate James Olsen and HIPinc have debts totaling between $100,000 and $10 million.

Olsen is well known for his ties to Democratic candidates and social issues. His internet site indicates his business, HIPinc, does defense consulting as well as business consulting.

Internet articles describe HIPinc as a business incubator.

The company also owns the building currently occupied by an at-risk children’s center known as Emma’s House.

Officials there say they are aware that HIPinc and Olsen have filed for bankruptcy protection but believe it will not affect their operations.

Court observers indicate Olsen and HIPinc likely filed for bankruptcy to protect against a lawsuit with the potential for a significant judgment against both Olsen and the company.

The trail to it shows up in bankruptcy documents where another Bitterroot man, Tim Meikle, is listed as one of Olsen and HIPinc’s creditors with a disputed claim of more than $4.5 million dollars.

Meikle ran a landscaping company called Great Bear Restoration. He filed suit against Olsen in July 2011 in Ravalli County.

That suit paints a picture of a business relationship between Meikle, Olsen and HIPinc that Meikle claims ended when Olsen raided Great Bear Restoration in order to keep other unsuccessful companies under HIPinc’s umbrella afloat.

Meikle claims he signed a deal in 2006 to run Great Bear Restoration in the HIPinc incubator. The suit alleges the deal called for the two men to share profits from Great Bear.

Federal court documents say Great Bear started making money by May of 2007, and by the end of 2007, had booked over $1.5 million dollars in sales.

From there, the court records claim Great Bear maintained its separate checking and by 2009 accounted for 67 percent of all of HIPinc’s income.

Meikle’s attorney writes, “During this time, none of Debtor Olsen’s other 'profit centers' were performing well at all.” Attorney Brian Miller goes on to write, “In 2010, Great Bear constituted 98 percent of all HIPinc income. In other words, by 2010, Creditor Meikle was completely supporting HIPinc, while Debtor Olsen himself was losing money throughout the rest of his operation.”

But Meikle claims Olsen told him Great Bear was running out of cash, and that Meikle was not managing the books correctly.

Then, in September 2010, Meikle reports he was diagnosed with cancer, and when he returned to work in January of 2011, found reports Great Bear had lost money.

Meikle’s suit claims that Olsen treated Great Bear as an accounting mechanism, “an accounting artifact,” that he used to fund other failing companies, including one run by Olsen’s wife.

Tuesday, Olsen returned our request for a call and comment.  He denied Meikle's accusations and explained how his personal and business bankruptcy filings were caused by legal bills from Meikle's litigation. 

Olsen wrote, "Tim Meikle, and his attorney, Brian Miller of the Helena law firm Morrison, Sherwood, Wilson, Deola, P.L.L.P. have mounted a crushing legal campaign – forcing us to find, deliver, and index thousands of documents and years of financial records while complaining to the Court that they have not gotten enough. We are being treated as if we were some Fortune 500 Company, when
in fact we are a family owned small business."

Olsen writes he and his attorneys have tried to resolve the suit through mediation.  But he adds, when that failed, "... we have no choice but to file Chapter 11 bankruptcy so that we can continue to do business and control legal fees."

Click below for Olsen's statement and the court documents relating to this story:
Complaint objecting to discharge of debts
Employment agreement between Tim Meikle and James Olsen
Job description for Tim Meikle
Great Bear Restoration Charter
Termination of business partnership
Summary of opinions
Deposition of James Olsen
HIPinc status statement