Real estate developer Dana Hollister has filed for bankruptcy three months after she was ordered to pay $15million in punitive damages for allegedly trying to interfere in the sale of a convent to Katy Perry.
In court documents obtained by DailyMail.com, Hollister lists the pop singer's company - 'The Bird's Nest LLC' - as one of her creditors to which she owes $5.2 million.
She also owes $10 million to the Roman Catholic Archbishop of Los Angeles as part of the December ruling.
But last Tuesday, Hollister submitted an emergency petition for Chapter 11 bankruptcy asking to reorganize her debts and to use cash collateral.
This is so even though she not in default on any contractual obligations secured by real property, she has paid all such obligations due for the month of March 2018, and her budget provides for such payments to continue.
She states she is seeking to 'reorganize by reaching a resolution of the dispute with the Archbishop and Ms Perry (whether through litigation or by settlement) so that Debtor can retain her estate and provide for her other creditors.'
Perry's legal team filed an opposition just two days later, slamming Hollister's motion stating she filed for bankruptcy just so she can 'carry on with her lavish lifestyle.'
In her filing, the LA-based developer lists assets totaling $49,055,621.30 and liabilities in the amount of $41,092,921.29.
The pop star claims Hollister fudged numbers in order for her income to appear lower in the initial lawsuit, and has now altered her finances to appear greater on her bankruptcy filing.
'Dana Hollister describes herself as a "very successful" "visionary" "innovator" and "entrepreneur." These words stand in stark contrast to the illicit conduct and behavior engaged by Ms Hollister that led to her file this bankruptcy case,' Perry's attorneys state.
'At the time [of the proceedings], it was in [Hollister's] financial interest to have a lower net worth since the jury was required to consider her finances when assessing punitive damages.
'The difference between the values she ascribed to assets in that proceeding and what she now ascribes just three months later to these very same assets, as set forth in the Bankruptcy Schedules, is staggering.'
Hollister and Perry's feud stems from a years-long legal battle that came about when the Roar singer sought to buy an eight-acre hilltop property - known as The Waverly Property - and its Roman-villa style buildings in LA's Los Feliz neighborhood for $14.5 million in 2014.
Perry's bid was approved by the LA archbishop.
However, the sale was nearly thwarted when Hollister stepped in and attempted to buy it directly from two nuns who had lived there.
The Sisters of the Most Holy and Immaculate Heart of the Blessed Virgin Mary owned the property for more than 40 years but hadn't lived in the convent for several years.
Hollister believed she owned the house after paying the nuns just $44,000 for the 20,000 square-foot property and moving in – while Perry was willing to pay $10 million to the nuns in cash, plus an additional $4.5 million for the home's House of Prayers, an Archdiocese spokesperson previously told DailyMail.com.
During a post judgment hearing on Friday, one of the nuns at at the center of the legal drama, Sister Catherine Rose Holzman, 89, died in court.
Holzman and Sister Rita Callanan had defended Hollister, who wanted to turn the 20,000 square-foot property into a boutique hotel with the nun's blessing, but has now been forced to declare bankruptcy.
'You have stolen the property of the Sisters of the Immaculate Heart. Please archbishop... Do what is right in your heart,' Callahan begged in the televised interview just before her friend's death.
In December, the jury found that Hollister interfered with contractual relations and other misdeeds. They also found that her actions led to Perry and the archdiocese having to pay exorbitant lawyer fees and other costs, which Hollister should get the bill for.
A judge voided that sale earlier this year, saying the archdiocese had the right to sell the property, not the nuns.
In her suit, Hollister claims she was told by the Sisters and their counsel, and her due diligence led her to believe, that the Waverly Property was owned by the Sisters and controlled by them.
'There were two parties interested in acquiring the property, Debtor [Hollister] and singer Katy Perry. Debtor offered to pay the higher price and, upon receiving the blessing of the Archibishop, the Sisters entered into an agreement to sell the Waverly Property to the Debtor.
'Debtor does not know, but suspects that Ms Perry, frustrated in her efforts to purchase the property, sought a 'higher power' to intercede on her behalf.'
Hollister, whose main business is The Paramour, which she lists has a value of $36 million, states that she filed on the eve of hearings on execution motions filed by the Archbishop and/or Perry and if not halted, would have 'irrevocably destroyed her business.'
Her emergency motion seeks approval to use cash collateral to pay wages, insurance premiums, mortgage payments, utilities and a personal budget (for Debtor's personal expenses) of $8,000/month.
Perry claims if Hollister's motion is granted she will continue to be able to live in her mansion, drive her Mercedes and carry on her lavish life style, 'No showing has been made which would justify an affront to her creditors.'
The singer stated she wants the Paramour put up for sale immediately saying the evidence demonstrates that there is a significant monthly diminution of the value of home and no corresponding benefit to the estate by the continued operation of the property.