Sale of Minnesota electrical business crumbles into tangled tale of alleged deceit

Burg, Ridgway said, was “looting” Birchwood’s assets, diverting them to himself and to Rodenwald and Rodenwald’s affiliated businesses — part of a plan to keep the Thoenneses from getting paid. Burg’s “actual pattern of conduct overwhelmingly supports a finding of fraudulent intent,” he said in the ruling.

Now, the Thoenneses and federal bankruptcy trustee Erik Ahlgren are pursuing Rodenwald, Burg and Burg’s wife, Nicole Burg, in court, seeking the $900,000. They also filed suit, trying to recover money from Randall State Bank, which allegedly financed Rodenwald’s house-flipping business through a company owned by Burg.

“The fraud perpetrated on the Thoenneses would not be possible without the willing participation” of the bank, the lawsuit said. Randall State Bank broke federal and state laws, too, the Thoenneses and the trustee claim.

The bank, in a statement through its attorney, called the allegations “baseless.” There’s not “a single piece of evidence that Randall State Bank was a ‘willing participant.’ The bank did not know of any fraud.”

The court ordered mediation in mid-September between Randall State Bank and the bankruptcy trustee and the Thoenneses, as well as mediation between the latter and Rodenwald.

Burg and Rodenwald, through their attorneys, declined to comment. The Thoenneses also declined to comment.