Damian v. Neer, 8:21-cv-01999

TGC operated a Ponzi scheme (2017–2019), raising over $75 million; Melanie Damian was appointed receiver in Dec. 2019 and sought recovery of $2,451,594.44 paid to Cody Neer via Bucks of America, LLC.
Transactions at issue were grouped: First Bucket (Aug–Sept 2018) — ten existing websites sold (notably DonaldTrumpCollectables.store (DTC) for $600,000); Second Bucket — $149,500 pass-through for four websites plus $5,517.93 reimbursement; Third Bucket (Agreement + renewed) — $1,439,500 paid for 178 newly built websites and related services.
Neer delivered sites, provided training, ad/account setup, supplier relationships, and paid contractors (~$798,098). Many Third-Bucket sites were unprofitable or live only a short time before shutdown.
The receiver argued transfers were fraudulent (actual and constructive IUFTA claims) and asserted unjust enrichment; Neer contended he acted in good faith and provided reasonably equivalent value.
The Court found Neer acted in good faith, provided reasonably equivalent value for most transfers (including DTC, two $12,000 sites, the Third Bucket collectively, and the $5,517.93 reimbursement), but voided seven First-Bucket transfers totaling $153,000; it held Neer not liable for the $149,500 pass-through as an initial transferee.

Issue	Damian's Argument	Neer's Argument	Held
Good faith of transferee	Neer knew TGC lacked resources and misled about site value; thus acted in bad faith.	Neer dealt at arm's length, reasonably believed TGC legitimate based on offices/people, provided training and additional services.	Neer met burden by preponderance: transactions were arm's-length and he acted in good faith.
Reasonably equivalent value (fraudulent-transfer defense)	Transfers were fraudulent because TGC received inadequate value (Ponzi context).	Neer provided market-value sites/services (DTC justified at $600k; group sites and services equated to fair value).	Most transfers provided reasonably equivalent value (including DTC, two $12k sites, Third Bucket and reimbursement); seven First-Bucket sales lacked proof of value and were voided.
Status of $149,500 payment (pass-through) as "initial transferee"	Receiver sought recovery from Bucks/Neer as initial transferee of $149,500.	Neer was an intermediary who merely forwarded funds at TGC's instruction and received no benefit.	Following Bonded, intermediary was not the initial transferee; judgment may not be entered against Defendants for this pass-through.
Unjust enrichment	Receiver argued Neer unjustly retained $2.4M benefit.	Relationship governed by contracts; unjust-enrichment claim duplicative and inapplicable.	Claim dismissed: contracts governed relationship and relief would duplicate fraudulent-transfer remedies.

In re Image Worldwide, 139 F.3d 574 (7th Cir. 1998) (reasonably equivalent value analysis and IUFTA interpretation vis-à-vis bankruptcy authority)
Barber v. Golden Seed Co., 129 F.3d 382 (7th Cir. 1997) (factors for establishing reasonably equivalent value and arm’s-length market analysis)
Bonded Fin. Servs., Inc. v. European Am. Bank, 838 F.2d 890 (7th Cir. 1988) (bank/intermediary that merely forwards funds is not the initial transferee)
In re First Commercial Management Group, Inc., 279 B.R. 230 (Bankr. N.D. Ill. 2002) (focus on consideration exchanged when assessing reasonably equivalent value)
In re Lancelot Investments Fund, LP, 451 B.R. 833 (Bankr. N.D. Ill. 2011) (Ponzi-scheme presumption of actual intent and discussion of defenses under IUFTA)