Fifth Circuit Upholds Jury’s Vindication of Dillon Gage in Fraudulent Transfer Suit

Bought by Stanford Receiver

May 5, 2017 in Case Summaries

In a published opinion addressing numerous aspects of the Texas Uniform Fraudulent Transfer Act, the Fifth Circuit upheld a July 2015 jury verdict in favor of Levinger PC client Dillon Gage Incorporated of Dallas in a long-running dispute with Ralph Janvey, the court-appointed receiver in the Stanford Ponzi scheme litigation.  The Court held that the evidence was sufficient to support the jury’s finding that Stanford Coins & Bullion did not have an intent to hinder, delay, or defraud creditors when it made six payments totaling $5.1 million to Dillon Gage, a coin and bullion wholesaler, in the weeks leading up to the receivership.  In particular, the Court emphasized evidence showing that SCB intended to satisfy its obligations to all of its retail customers, as well as the Receiver’s failure to establish that SCB was insolvent at the time of the transfers.  Finally, the Court rejected the Receiver’s complaints about four aspects of the jury charge, including an instruction that a fraudulent intent cannot be inferred from a debtor’s mere intent to prefer one creditor over another.  Janvey v. Dillon Gage Incorporated of Dallas, 856 F.3d 377 (5th Cir. 2017).

Courts: Federal Courts of Appeals
Subject Matter: Business Litigation, Procedural & Evidentiary Issues