Sunday, January 22, 2023

Receiver Complains of Foot-Dragging in Madison Timber Recovery

The receiver's clawback lawsuit continues to wind (or is it wither) away in U.S. District Court.  

The SEC is trying to claw back illegal profits earned by Lamar Adams and  promoters of a $164 million Ponzi scheme based on phony timber investments.   Receiver Alysson Mills represents the SEC. She recovers assets, distributes them among the victims, and provide progress reports to the court every 90 days to the court. Adams is currently incarcerated in federal prison after he pleaded guilty to one count of wire fraud.   The case is assigned to Judge Carlton Reeves.

Judge Reeves appointed Ms. Mills in June 2018.  The Receiver said she has managed to recover and distribute $17.5 million to victims.   However, receivers efforts to recover against such prominent businesses as Trustmark, Bankplus,UPS,  and the Baker Donelson law firm continue to drag on in federal court.  However, Ms. Mills has an excuse: 

The Court already denied or otherwise resolved every motion to dismiss filed by every defendant in the Receivership Estate’s four biggest cases. Ordinarily, a case would proceed to discovery and, finally, trial. Typically, the court gives the parties a trial date, and they work backwards from it to prepare.

But not here. Here, the parties continue to exchange written discovery only. I filed the first of the Receivership Estate’s four biggest cases in December 2018. Soon four years will have passed without a single deposition.

Magistrate Judge Keith Ball consolidated all four cases for discovery, and that has slowed things almost to a halt. Defendants have asked to postpone non-written discovery (i.e., depositions) indefinitely, and so far, they have had their way. Rather than address the allegations against them, defendants have attempted to subpoena numerous government agencies—in addition to the S.E.C., the IRS, the U.S. Postal Service, the Department of Justice, FinCEN, even the United States Secret Service!—for the apparent purpose of passing blame and creating more trial-delaying litigation.

Of course, I strongly oppose the continued delay of trial of these cases. I have repeatedly asked for a trial date for each of the four cases. Without a trial date, there is little pressure on any defendant to either meaningfully prepare for trial or resolve the case against it.

She mentions Bill McHenry.  The Justice Department took a swing at the Lamar Adams cohort but struck out in federal court when he was acquitted.  The Receiver attempted to collect $3.5 million from him but the defendant predictably filed bankruptcy: 

I continue to attempt to collect on the Receivership Estate’s $3,473,320 judgment against Bill McHenry. As previously reported, I have moved to hold McHenry in contempt for, among other things, perjuring himself during his judgment debtor exam. The Court appointed criminal counsel to represent him in those proceedings. A hearing, which had been set for August 18, 2022 but was postponed to permit McHenry’s counsel an opportunity to collect information, is now postponed indefinitely because McHenry filed for bankruptcy again.

The report contains updates on other cases but the information is more of what is already posted above. 


Anonymous said...

Nothing is ever her fault it seems. Maybe time for a new receiver.

Anonymous said...

Welcome to litigation, sweetheart.

These lawyers are not going to lay down because Daddy is a judge...

Anonymous said...

Longer the foot-dragging = more billable hour$.

Anonymous said...

Judge Reeves needs to issue a scheduling order that includes a trial date, plus a separation of the parties.

Anonymous said...

If she this this is slow, just think if it was Judge Wingate.

Anonymous said...

Most “victims” will be dead and gone before this mess is over.
Lamar will be back on the steets.

Anonymous said...

A total miscarriage of justice was/is McHenry skating. Skating all the way to his back yard where 300 coffee cans full of money are buried. How do you have over 3 million one day and file for bankruptcy the next? The money went somewhere and if it went into assets, won't those assets be somehow held by the bankruptcy court?

Anonymous said...

Alysson is a phenomenal attorney and legal mind. Any implication that she doesn’t understand litigation is likely coming from someone who couldn’t get an LSAT score that would merit consideration from Cooley.

Anonymous said...

11:23 - she seems to be an forensic investigator rather than a litigator. I don't know anything about her...that's why I said 'seems'.

Anonymous said...

all she has to do is claw back the investor profits. why hasn't she? who is she hiding?

Anonymous said...

I was talking to a friend who claims he made $50k in the early days of the deal. Then he got suspicious and pulled his money out about a year before it blew up. He claims he hasn't heard a word from anyone about having to give his profits back.

Anonymous said...

@11:23 - Cooley (and every other law firm) doesn't care about LSAT scores. But you don't know that because you don't know what you're talking about.

Anonymous said...

Attn 12:19 I don’t believe you because anyone who is still holding profits from this scheme certainly wouldn’t tell a blabbermouth like 12:19 who would blast it on this internet site.

Anonymous said...

Hey Mr. “don’t know what you’re talking about” at 1:35 pm, Cooley is a law school, thus they would be interested in LSAT scores. Better to remain silent and be thought a fool than to open your mouth and remove all doubt.

Anonymous said...

12:19, its b/c of who would have the $ pulled back. politicians, "important" people, etc. As always, it's about who you know. Somebody needs to pull that curtain back but it will never happen. Unequal justice for all.

Anonymous said...

I know a handful of the investors who made a profit. I just don’t see how it would be fair to take from Peter and pay Paul. These folks were simply investing their retirement money and had zero idea it was a scam. Most of the folks who lost money, made profits long before the scam was brought to light and their current checks were no good. Looking back, WillBob Mchenry, gave a whole lotta money to people who were down on their luck. He’s a kind of a Robin Hood for some of the good deeds he did. I don’t have a dog in the fight, but the moralities of this whole scam are like a sparkler. The real winners are the lawyers. The losers probably had equal gains before they lost.

Anonymous said...

12:37, I suspect just about everyone came out ahead except for the last few that couldn't find a seat when the music stopped. The cure here may be worse than the disease, but we'll never know b/c its all hidden

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