This case arose from the failed leveraged buyout of an energy services company called North Star Energy & Construction LLC (“North Star”) by its then president, Alexander Mantle.
Appellants filed suit against North Star’s member entities (and the individual principals of those member entities) asserting claims for unjust enrichment, bad faith, fraudulent conveyance of real estate, fraudulent conveyance of personal property, breach of fiduciary duty, fraud, actual fraud, securities violation, and veil piercing. In response, Appellees filed a counterclaim against Alexander Mantle alleging breach of contract for failure to abide by the terms of a Memorandum of Understanding previously executed by the parties to the leveraged buyout.
Kim D. Cannon and Codie D. Henderson of Davis & Cannon, LLP, representing three (3) of the Appellees, succeeded in getting the claims for unjust enrichment, bad faith, breach of fiduciary duty, fraud, actual fraud, and securities violation dismissed on summary judgment. The firm also defeated Appellants motion for summary judgment as to the breach of contract counterclaim.
The case proceeded to trial on August 7-15, 2017, on the remaining claims. At trial the firm successfully defeated the claims for fraudulent conveyance of real estate and veil piercing.
Appellants were awarded a small judgment of $250,000 against one of the firm’s three (3) clients for a fraudulent conveyance of personal property. However, the firm succeeded on the breach of contract counterclaim and received a 6.11 million dollar judgment against Appellant Alexander Mantle.
On appeal, the firm successfully defended the summary judgment ruling and the judgment obtained at trial. The Wyoming Supreme Court affirmed the trial court’s decision in all respects, including the 6.11 million dollar judgment on the counterclaim.
On March 6, 2019, Amanda F. Esch and Leah C. Schwartz obtained a victory for the City of Gillette, Wyoming in front of the Wyoming Supreme Court. The City terminated Catherine Mahoney, a police dispatcher, after she disclosed confidential department information to a City Council member as part of her on-going complaints about her supervisor. Due to her violation of several City policies, Mahoney was terminated. Mahoney was ultimately denied unemployment at the City’s request, as the City argued she committed misconduct, thus disqualifying her from benefits under Wyoming law. Ms. Mahoney appealed this decision, arguing she did not commit misconduct because she was advocating for the safety of the public, and in any event, her disclosure was protected free speech under the First Amendment. The City obtained judgment from the District Court on both issues, and that decision was upheld by the Wyoming Supreme Court.
Wyoming Supreme Court 2019 WY 14 Decision: January 31, 2019
Appellant Stanley E. Thomas was a co-obligor, with his single member LLC, on a mortgage note and Wyoming judgment. The co-obligor LLC was partially discharged of the debt by the bankruptcy court. The Court held that Appellant Thomas, who was not a party to his co-obligor’s bankruptcy, was not entitled to the benefit of the partial discharge of debt granted to the co-obligor by the bankruptcy court.
The Wyoming Supreme Court held that partial discharge of a debtor in bankruptcy does not relieve a bankrupt’s co-debtor, not a party to the bankruptcy, from his joint and several liability under a mortgage note and Wyoming judgment. The Supreme Court also ruled that the appropriate standard of review for a mortgage deficiency judgment is a de novo review.
Wyoming Supreme Court 2018 WY 133 Decision: December 3, 2018
Representing an accountant and judicially appointed conservator, the firm successfully defended a prior summary judgment ruling in the client’s favor. The case involved claims of professional negligence and professional malpractice in a divorce that allegedly resulted in $30,000,000 in damages.
Wyoming Supreme Court 2018 WY 19 Decision: February 22, 2018
Representing a charitable foundation incorporated as a public benefit nonprofit corporation, the firm successfully defended a prior summary judgment ruling in favor of the client. The Wyoming Supreme Court held that claims against the client by a disgruntled director struggling to control the foundation can only be brought as a derivate action. The victory on appeal avoided judicial dissolution of the foundation on the basis of deadlock.