On Friday, April 3, 2026, the Herald-Leader reported that lawyers for a major U.S. bank are seeking to have a Fayette Circuit judge removed from a property dispute case, alleging a conflict of interest tied to her relationship with a court-appointed receiver.
Attorneys representing Bancorp, a Minnesota-based lender, filed a motion on March 30 asking Judge Julie Muth Goodman to recuse herself from overseeing litigation involving several distressed properties in Lexington. The bank is attempting to recover funds tied to multiple apartment complexes and restore its liens against borrowers it claims have defaulted on debts.
The motion centers on James Frazier III, a receiver appointed by Goodman to manage the properties during the course of the litigation. Bancorp’s attorneys contend that Goodman failed to disclose that Frazier is also serving as one of her legal representatives in impeachment proceedings brought against her by state lawmakers.
In their filing, the bank’s lawyers argued that the dual role raises concerns about impartiality, particularly as Goodman may be required to evaluate objections related to Frazier’s actions or fees in the case. They asserted that a reasonable observer could question whether the judge could fairly oversee matters involving an attorney she is simultaneously relying on for her defense in a high-stakes political case.
The underlying lawsuit, filed in January 2025, involves foreclosure proceedings against property owners Creekside Holdings and Cambridge Homes Holdings. The properties in question include several apartment complexes in west Lexington, totaling up to 400 units. As receiver, Frazier had been tasked to take control of the properties while the suit moves through the courts.
Frazier, who also serves as CEO of the Lexington-based law firm McBrayer and as master commissioner of the Fayette Circuit Court, defended his appointment and the lack of disclosure. He stated that because he is not a party to the litigation, disclosure of his separate legal work for Goodman was not required.
Despite that position, Frazier resigned from his role as receiver one day after the recusal motion was filed. He said the decision was made to prevent delays in the case and to allow progress on addressing conditions affecting residents of the properties, including issues with heat, water, and sewer services.
The recusal request comes amid broader legal challenges facing Goodman. She is currently contesting impeachment proceedings initiated earlier this year. While a Franklin Circuit judge recently voided impeachment documents, a state Senate committee is still scheduled to review the case.
It remains unclear whether Bancorp’s attorneys will withdraw their motion following Frazier’s resignation.
Proceedings in the property dispute are currently paused pending a decision by the Kentucky Supreme Court on whether a special judge should be appointed. A replacement receiver is expected to be named after that determination.
Source: Herald-Leader
