For a collection of all posts on the Evans case, see Evans page under Special Coverage section on right side of page.
Audio recording of hearing. Click on arrow to listen.
Highlights:
-Compromise settlement between G&B and Trustee approved
-limited protective order approved
-G&B and Mississippi Valley Title files notices to depose each other
-Trial is set for February, discovery due by December.
Another hearing in the Evans case took place last Thursday in Judge Neal Olack's courtroom. Mississippi Valley Title filed a motion for a protective order on October 4 seeking to seal all discovery in the lawsuits filed against it by G&B Investments, Bank of Forest, and Merchants & Farmers Bank. Copy of proposed protective order.
G&B filed suit against the Evans brothers, various Evans-owned companies, Mississippi Valley Title Insurance Company, and MVT's parent company, Old Republic. G&B owned 105 acres of land on Hwy 463 in Madison. G&B sold the land to the Evans brothers in 2008 for $16 million. The Evans brothers made a $5 million down payment and G&B provided owner financing for the rest of the land. What G&B did not know is that the week before the closing, the Evans brothers obtained the down payment through mortgage fraud. The Evans brothers represented to M&F, Bank of Forest, and Heritage Bank using phony title certificates it indeed owned the land and borrowed $5 million on land they did not even own. The brothers then turned around and used the money as the down payment. See earlier post. The brothers used 77 acres of the land as collateral for the deed of trust they issued to G&B. G&B argues since Mississippi Valley Title allegedly insured a portion of the 105 acre tract for 200%, it should have known wrongdoing was taking place. G&B asked for punitive damages as well as other forms of relief. G&B had foreclosed on the 77 acres used as collateral but the foreclosure was put on hold by the bankruptcy trustee.
G&B (posted below), Bank of Forest, and M&F objected to the proposed sealing of discovery and instead proposed a limited protective order to protect proprietary and confidential financial information. G&B argued Mississippi Valley Title had not even specified which records were should be kept confidential- the title insurance company wanted to keep all records under seal (page 7 of objection posted below). Judge Olack issued (see order posted below) a limited protected order allowing the parties to designate information as confidential but giving them the right to object to such a designation by another party. Judge Olack also reiterated the case was going to trial in February and gave the parties until December 12 to complete all discovery. Judge Olack then approved a compromise settlement between G&B and the trustee. G&B thus regained its 77 acres but retained the right to take action against Mississippi Valley Title and Old Republic on any claims or injuries involving the remaining land which is the source of contention between all of the parties.
Another bombshell was dropped in the proceedings when Attorney Kristina Johnson, representing Bank of Forest, announced that two attorneys, Lawrence Deas and William "Sonny" Liston III, would be pursuing her client's claims against the insurance companies for damages. Sources in the legal community informed JJ both lawyers are good plaintiff's attorneys. The close of the hearing didn't end the skirmishing either as G&B and Mississippi Valley Title both served notices to depose on each other. Copy of G&B notice, Copy of MVT notice.
It is no surprise the legal battle came to this point. If there has been one consistent theme in this whole mess besides the greed of Charles and Chris Evans, it has been the hardball tactics used by Mississippi Valley Title and Old Republic. When Mississippi Valley Title first took action against the Evans brothers in Madison County Chancery Court, it filed an affidavit by its investigator explaining how the fraud took place under seal. A crossclaim filed by the Bank of Forest alleges the bank made repeated inquiries to Mississippi Valley Title on what the "problem" with its loan was only to run into a stone wall (see p. 25). It was not until the case was finally heard over five weeks after the lawsuit was filed any explanation of the mechanics of the fraud itself were presented. Mississippi Valley Title finally filed an exhibit in bankruptcy court in November that was an affidavit of its investigator that is an likelihood, a duplicate of the affidavit presented in chancery court.
Mississippi Valley Title then threatened at least one bank attempting to assert its rights in bankruptcy court with action stating the bank was acting adversely to its claim. Mississippi Valley Title then fought all requests for a 2004 exam despite the fact the bankruptcy code allows for any party to examine any other party in a bankruptcy. Mississippi Valley Title then fought the attempts by the banks to obtain their policy manuals, claiming it was proprietary information that would aid their competitors. The banks desire the manuals so they can examine what MVT's underwriting standards are and if they deviated from them on the Evans' loans. Mississippi Valley Title then played games with the Court in drafting an order requested by the Judge to the point where Judge Olack threatened in writing to impose sanctions (on all parties) if such conduct continued. It should be noted throughout this ordeal Mississippi Valley Title has not paid a substantial number of claims and didn't pay other claims until several months had passed.
The protective orders sought by Mississippi Valley Title are merely a continuation of the strategy it has followed from day one in the Evans case. Given the speed in which the deposition notices were issued, the disagreements over the protective orders, and the retaining of additional counsel to pursue claims against Mississippi Valley and Old Republic, its clear this fight is now becoming a war.
Stay tuned.
8 comments:
Look at those fees adding up over time, I am sure over time (a lot) this will be resolved. The question is, who loses?
This is a great example of our Justice system looking sideways and trying to do the best it can in the face of adversity (read greed).
The Bankruptcy court has been responsible and professional (to the extent it sees this complex situation unfold); criticism is not of the courts, the criticism is about the governing body that polices the perpetrators.
I guarantee you, if this was a Union issue, the Union would distance themselves or say something. Or, they would be under fire. Let's face it, attorneys in MS are connected and fearful of an organization that will not stand up to the realities of the profession. I challenge any attorney to say otherwise.
Unfortunately, the quiet society of silence is "the only policy"; the governing body continues to put attorneys of fine reputation in positions of questioning their own ethics because they will not, cannot speak out.
Why oh why do we allow this to happen? Well, I guess, its complacency and the inability for the public to understand and ultimately Stand Up. Or, it could be.....
And don't give me you have a conflict of interest to not speak up. You know that is B$.
I pray that relief is granted to the banks, to the bank interests and those that have lost millions in the face of an apparent fraud.
What I don't understand is why would Valley continue to fight this when no local bank is using them now anyway? Why make it worse? Pay the claims and at least try to re-establish your rep in the area. But this is just exacerbating the problem.
The only way Valley can survive this, I believe, is to successfully defend against these "claims". If they lose these lawsuits and ultimately have to pay their "insureds" for MVT's own actions, then I believe that ORI will finally pull the plug on this once-respected company, since there will no longer be any reason for it to exist.
But you don't need to deceive yourself, banks still RELY on this company for advice and counsel, strange as it seems, and at least one MVT director is a banker. As a result of this "war", I don't think that MVT will NOT suffer ANY loss of face among the only group that it cares about, its attorney-agents. Granted, some attorneys have gotten additional agencies with other insurers as a result of some banks not accepting MVT polices, but in time the bankers will fold. This is what MVT/ORI knows and this is what its attorney-agents know. This is really a fight against the way the real estate finance industry works in this state.
This fight ("war"?) is being fought in MVT/ORI's briar-patch (the judicial system) and not in the banks' briar-patch (whatever that may be). Smart money is on MVT/ORI to either prevail against or wear down their "insureds".
Also, I notice from the documents that you attach that ORI/MVT has managed to successfully obtain a "gag order" of sorts from Judge Olack. Let the news black-out begin!
Sorry for the double-negative, should have said: "As a result of this "war", I don't think that MVT will suffer ANY loss of face among the only group that it cares about, its attorney-agents."
Old Republic has more than enough money to pay these claims. The policies were jointly issued.
Its not so much a gag order as protecting confidential financial information, which I can understand. I'm not too worried about it. There's not a document in this town I can't get my hands on if I want to bad enough.
KF, ego boy, why don't you try your hand at getting Obama's birth certificate?
Imagine my shock yesterday at finding out that MVT (or ORI probably) has already paid $17,000,000 on Evans claims thru last May.
I have never heard this anywhere and it surprises me that it has not been reported anywhere!
well, well, well, my little troll is back. Imagine my shock too as its not mentioned in any court documents, which I've posted on this website in case I missed anything. You happen to have any inside knowledge the rest of us are not privy to? They paid some claims after the settlement/compromise was approved earlier this year but there are still many claims outstanding. They paid some of M&F's for example but M&F still has a claim for $3 million. This site also mentioned claims were paid but there were many claims still not paid. There is a reason more and more banks are suing these guys. 17 million from 41 million still leaves..... 24 million and thats not counting the GB claim that was not filed when that document containing 41 million was filed so add another 12-15 million on top of it. Gee, we are back up to nearly 40 million again.
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