A Tarrant County jury unanimously awarded the state of Washington $24 million in damages in a fraudulent transfer and veil piercing case against two affiliated Frisco-based wealth advisory businesses.
The jury deliberated for about two hours Tuesday after the six-day trial before it returned its verdict in state District Court Judge Dusty Fillmore’s courtroom.
“I’m extremely proud of this win. It was a challenging test, but our team rose to the occasion, and it really shows how deep our bench is. Our mantra is, ‘Simple cases win,’ and this case exemplifies that. We had to cut through a lot of complexity and issues to develop a strategy focusing the jury on the core themes and claims,” the state of Washington’s counsel, Jon Patton of Tillotson Patton, told The Texas Lawbook.
Tillotson Patton was brought in just two weeks prior to trial. Patton said the firm is familiar with being hired on the eve of trial and deciding how best to move forward.
The case was originally filed in Washington against CLA Estate Services and CLA USA for violating Washington’s consumer protection statutes. In March 2021, the state obtained a $14.5 million final judgment against the businesses.
When the state attempted to collect on the judgment, the CLA businesses claimed they had no assets.
Washington alleged the businesses conspired to hide and deplete assets to avoid paying the judgment, and the jury agreed.
The jury, which consisted of 11 women and one man, found the businesses transferred assets with intent to delay and defraud Washington as a creditor.
According to court documents, the CLA businesses claimed Washington unnecessarily prolonged the litigation. They also denied they had moved assets to avoid paying the judgment.
Mollie Mallory, Sara Babineaux and Nathaniel Buchheit of Tillotson Patton also represented the state of Washington.
J. Mitch Little and Shirley Rose of Scheef & Stone represented the CLA businesses. They did not immediately respond to a request for comment.
The case number is 236-332083-22.