REDACTED VERSION OF AMENDED RULING REGARDING THE APPLICATION OF BANKRUPTCY CODE SECTION 550(d) TO CLAIMS AGAINST CIANNA RESOURCES. INC.
This ruling addresses the proper application of the feingle satisfaction rule found
The plaintiff in this action (the “Trustee”) sued Ruthven Oil & Gas, LLC (“Ruthven”), Wendell Holland (“Holland”), the Wendell and Kari Holland Trust (the “Holland Trust” and together with Ruth-ven and Holland, the “Ruthven Defendants”), and Cianna Resources, Inc. (“Cianna”) to avoid fraudulent transfers. The debtors in the underlying jointly-administered bankruptcy cases (the “Debtors”) were in the business of acquiring mineral interests, and in acquiring such interests, the Debtors made use of the brokerage services of the Ruthven Defendants, who in turn made use of the services of certain sub-brokers, including Cianna. There were many transactions in which the Debtors acquired mineral interests, and in connection with those transactions, Ruthven was the initial transferee of $48,812,882.24. Cianna only acted аs a sub-broker in transactions involving initial transfers of $28,358,668.09 though, and in connection with those transactions, Cianna was a subsequent transferee of $21,722,518.98.
Several years into the case, the Trustee obtained a partial summary judgment finding that the transfers of $48,812,882.24 from the Debtors to Ruthven were fraudulent transfers avoidable under Bankruptcy Code section 548(a)(1)(A), but also finding that genuine issues of material fact remained as to Ruthven’s “value and good faith” defense under section 548(c). Ultimately, the Trustee settled with the Ruth-ven Defendants [in exchange for certain assets and consideration, which cannot be enumerated here because of a confidentiality provision in the settlement agreement] (the “Settlement Consideration”), [redacted] Cianna took the position before the District Court that pursuant to section 550(d), at least some portion of the Settlement Consideration must be allocated to rеduce the Trustee’s claims against Cian-na.
On June 28, 2016, the Honorable Jane Boyle, United States District Court Judge for the Northern District of Texas entered an Order of Reference
I. JURISDICTION
This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 157 and 1334(b). The defendants obtained withdrawal of the reference, but the determinations in this ruling were specifically referred to this Court by District Court Judge Boyle. Because the determinations made in this ruling will not result in a judgment or a final order, this Court believes it may enter a ruling as opposed to proposed findings of fact and conclusions of law pursuant to 28 U.S.C. § 157(c)(1). See, e.g., West v. Peterson (In re Noram Res., Inc.), No. 11-3598,
II. LEGAL RULING
The legal question before the Court is whether there is an issue of single satisfaction under Bankruptcy Code section 550(d) in this adversary proceeding given the Trustee’s settlement with the Ruthven Defendants. Stated slightly differently, the Court must determine what impact, if any, the Trustee’s receipt of the Settlement Consideration has on the remaining claims against Cianna.
Section 550(a) gives a trustee broad recovery powers once a transfer has been avoided, allowing him tо recover the property transferred or the value of such property from either an initial transferee or a subsequent transferee. For example, if a debtor transfers $100 to A, and A transfers $50 of that $100 to B, the trustee would have a claim for $100 against A as an initial transferee and a claim for $50 against B as a subsequent transferee. This obviously presents the danger of a trustee recovering more than a debtor transferred, which brings us to the “single satisfaction rule.”
Section 550(d) of the Bankruptcy Code states: “The trustee is entitled to only a single satisfaction under subsection (a) of this section.” The purpose of this rule is to prevent the trustee from recovering more than he should, but the trustee is still entitled to a full satisfaction. See Kapila v. Suntrust Mortg. (In re Pearlman),
The first challenge presented by this case is that the initial transferee settled but the subsequent transferee did not. If the opposite were true, the amount recoverable from the initial transferee would have simply been reduced by the full amount of the settlement proceeds recovered from the subsequent transferee so as to prevent the trustee from recovering more than the total amount of the avoided transfer. See, e.g., Lindquist v. JNG Corp. (In re Lindell),
This case presents a further complication because the Trustee had claims against the Ruthven Defendants for a large number of transfers, but only some of those transfers involved subsequent transfers to Cianna. As a result, some of the claims against the Ruthven Defendants were relevant to Cianna but some were not, and the Ruthven Defendants settled all of them at once in exchange for the Settlement Consideration. The Settlement Consideration received by the Trustee on account of claims that were unrelated to Cianna (and the amounts still left unsatisfied on those claims) should not have any effect on Cianna’s remaining potential liability.
A. The Parties’ Suggestions for Application of the Single Satisfaction Rule
The Court must identify an application of the single satisfaction rule that suecess-fully navigates the specific challenges of this case while staying true to Bankruptcy Code section 550(d) and the recovery mechanism more broadly described in section 550(a). It is helpful to examine the various approaches suggested by the parties to see whether each comports with the language and purpose of the statute.
1. Full Settlement Credit Pursuant to Texas Law
Cianna first asserts that Texas law on settlement allocation should apply, which Cianna claims would give it a “100% settlement allocation credit” pursuant to section 33.012(b) of the Texas Civil Practice and Remedies Code (the “TCPRC”). For the reasons expressed below, the Court does not believe this is an accurate interpretation of the single satisfaction rule.
First, federal law, not Texas law, applies. See In re Prudential of Florida Leasing, Inc.,
Second, even if the Court were to look to Texas law, it does not appear that Cianna would receive a full settlement allocation credit. At least one court has examined whether the Texas proportionate responsibility statute (Chapter 83 of the TCPRC) applies to fraudulent transfer actions under state law and concluded in a well-reasoned opinion that it does not. See Challenger Gaming Solutions, Inc. v. Earp,
[A]n UFTA claim does not lend itself to a fault-allocation scheme. Rather, the focus of an UFTA claim is to ensure the satisfaction of a creditor’s claim when the elements of a fraudulent transfer are proven. Specifically, the UFTA provides several different forms of equitable relief designed to follow and reach assets.
Id. at 298.
To further Alústrate why this is an unworkable interpretation, in our hypothetical in which a debtor transfers $100 to A and A transfers $50 of that $100 to B, say A settles for $50. If we give B a “settlement credit” for the full amount of the settlement, this results in no liability for B, and the trustee has been prevented from following the property and from recovering half of the avoided transfer. That result appears contrary to the goal of section 550 to make the trustee whole, and the Court can find no support for this result in the Bankruptcy Code.
Finally, on September 23, 2014, Cianna stipulated and agreed that “Chapter 33 of the Texas Civil Practice and Remedies Code does not apply to fraudulent transfer claims under the-Bankruptcy Code or the Uniform Fraudulent Transfer Act.” Agreed Order Denying Leave for Responsible Third Parties Designations [Docket No. 216],
Cianna next suggests that it should receive a dollar-for-dollar credit against its potential liability for the portion of the Settlement Consideration allocated to the claims settled by Ruthven that Cianna characterizes as “joint liability” claims. Specifically, Cianna characterizes approximately $22 million of the total $48 million of claims against Ruthven as “joint liability” claims because those represent the amount that Ruthven received from the Debtors and then transferred to Cianna.-This would result in a reduction of the Trustee’s claims against Cianna of at least 45.16% of the value of the Settlement Consideration. Reducing a subsequent transferee’s liability based on a proportional allocation, however, is inconsistent with the recovery scheme in section 550 of the Bankruрtcy Code.
The parties disagree over whether (1) the claims against Cianna are claims for which Cianna and Ruthven were jointly liable or (2) the Trustee has independent claims against Cianna and Ruthven. The import of this dispute is that Cianna asserts that if Ruthven settled claims that Cianna was jointly liable for, the Settlement Consideration must be allocated, at least in part, to those joint claims, and as a result, the claims against Cianna must necessarily be reduced by the full amount of the allocation. The Court believes this misconstrues the purpose and function of section 550. The aim of section 550(a) is to allow the trustee to follow the property that has been transferred away from the debtor. The statute does not speak in terms of assigning damages to different parties or apportioning fault or responsibility for damages. Rather, the statute refers to the trustee’s ability to recovеr the transferred property, or the value of such property, from the parties that received it.
In our hypothetical in which the debtor transferred $100 to A and A subsequently transferred $50 to B, say A settles for $50, the value of the property that A is still holding. Under Cianna’s proportional allocation of the settlement value, B would receive a “settlement credit” for $25, leaving the trustee with a recovery of $50 and a surviving claim against B for only $25. The trustee would not be able to obtain a full recovery of the property from the parties who have it. If a partial recovery from the initial transferee always impaired the ability of the trustee to pursue the remainder of its claim against the subsequent transferee, the purpose of section 550 would be thwarted. The Court in Prudential specifically cautioned against adoption of an application of the single satisfaction rule that would prevent complete satisfaction in many instances. Prudential,
Cianna acknowledges that applying this proportional allocation of settlement consideration will consistently result in an impairment of a trustee’s ability to recover the full amount of any avoided transfers. Cianna states in its brief: “As cases dealing with § 550(a) settlements show, a settlement is a game-changer with respect to a trustee’s ability to recover 100% of a fraudulent transfer—once the trustee compromises his claims in settlement, he bargains away his right to a full recovery.” Response to Trustee’s Brief on Section 550(d) at p. 12 [Docket No. 333]. Interestingly, this impairment of the trustee’s ability to recover the full amount of avoided transfers from the рarties actually holding the property only occurs if the trustee settles with the initial transferee first. In our hypothetical, the trustee could first
In any event, the Court does not read the authority Cianna cited to support a proportional allocation of settlement proceeds for amounts for which there is “joint liability.”
3. Reduction of Maximum Recovery in Overall Lawsuit
The Trustee suggests that the Trustee’s maximum potential recovery in the entire lawsuit should be reduced by the amount of the Settlement Consideration, and Cian-na’s liability should only be reduced to the extent that the Trustee’s maximum potential recovery in the lawsuit is less than the amount Cianna received as a subsequent transferee. This approach satisfies the purpose of the single satisfaction rule by putting a ceiling on the Trustee’s recovery, but the ceiling is too high. By examining the Trustee’s maximum potential recovery in the entire lawsuit, the Trustee conflates the claims in the lawsuit and ignores the fact that Cianna was not a subsequent transferee for some of the initial transfers that are being settled. The Trustee’s inability to recover on unrelated initial transfers should not impact Cianna’s potential
To expand our hypothetical, say the debtor engages in two transactions with A. In the first transaction, the debtor transfers $100 to A and A transfers $50 to B. In the second transaction, the debtor transfers $100 to A and A transfers $50 to C. When the trustee sues A, B, and C, he elects to do so in a single lawsuit. Under the Trustee’s suggested application of section 550(d), if A settles all claims against it for $150, both B and C could still be liable for $50 each. Then if the trustee recovers $50 from either B or C, presumably the liability for the other party would go away. But this cannot be. A subsequent transferee’s liability should not be affected by the trustee’s recovery from a subsequent transferee on an unrelated transaction.
To disentangle these transactions, the Court concludes section 550(d) must be applied on a transfer-by-transfer basis, which requires an allocation of settlement consideration across the claims being settled. See Prudential,
B. The Appropriate Application of the Single Satisfaction Rule in this Case
The purpose of section 550 is to restore the estate to the financial condition it would have been in if the avoided transfers had not occurred, and the specific purpose of section 550(d) is to act as a restrictor plate on the roaring engine of recovery provided to the trustee in section 550(a). The single satisfaction rule cannot be circumvented by conflating multiple unrelated claims and lawsuits, but at the same time, the single satisfaction rule does not exist to create a windfall for defendants once a settlement has been reached. The Court must identify an application of section 550(d) that prevents the possibility of a double recovery, but the Court must also be careful not to adopt a rule that would, in many cases, prevent a single complete satisfaction.
The Court, therefore, concludes that section 550(d) must be applied on a transfer-by-transfer basis, and for each transfer, the Court must do the following:
• First, look at the amount of the initial transfer that gave rise to the subsequent transfer, which sets the maximum recovery.
• Next, deduct from the maximum recovery the value received by theTrustee in any settlement with the' initial transferee.
• And after these first two steps are complete, the Trustee may recover from the subsequent transferee the lesser of (1) the amount the subsequent transferee received or (2) the Trustee’s maximum recovery as reduced by any settlement.
In order to do- this calculation, the Court must know (1) the total amount received by the initial transferee for each transfer; (2) the total amount received by the subsequent transferee on account of each initial transfer; and (3) the settlement value received by the Trustee on account of each initial transfer. The portion of the $48 million in initial transfers that resulted in subsequent transfers to Cianna, along with the value of the Settlement Consideration, will drive the allocation that the Court can then use to set the ceiling for recovery from Cianna. The remaining items for determination are (1) valuation of the Settlement Consideration, (2) a listing of the amounts of the specific initial transfers that gave rise to the subsequent transfers to Cianna (the “Relevant Initial Transfers”), and (3) an allocation of the Settlement Consideration across the Relevant Initial Transfers.
IV. EVIDENTIARY RULINGS
Before the Court can make the required factual determinations, it must first address the parties’ evidentiary objections. Specifically, the Trustee filed the Liquidating Trustee’s Motion tо Exclude Expert Testimony of John P. Dick [Docket No. 367] (the “Trustee Motion to Exclude”) and Cianna filed the Defendant Cianna Resources, Inc’s Motion to Exclude the Proposed Expert Testimony of Stephen E. Nichols [Docket No. 379] (the “Cianna Motion to Exclude”).
Federal Rule of Evidence 702 serves as the standard for determining the admissibility of expert testimony. Daubert v. Merrell Dow Phams., Inc.,
(a) the expert’s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;
(b) the testimony is based on sufficient facts or data;
(c) the testimony is the product of reliable principles and methods; and
(d) the expert has reliably applied the principles and methods to the facts of the case.
Fed. R. Evid. 702. Pursuant to Federal Rule of Evidence 104(a), the Court must act as a gatekeeper and determine any preliminary question about whether an expert witness is qualified and whether expert testimony is admissible. Moore v. Ashland Chem., Inc.,
“The proponent of expert testimony bears the burden of establishing its admissibility.” Kador v. City of New
Admissible expert opinion may be based on data or facts the expert “has been made aware of or personally observed.” Fed. R. Evm 703. The basis of the testimony may include facts or data that would not be admissible in evidence, so long as such data or facts are of a type reasonably relied upon by experts in the field in forming an opinion on the subject. Id. “[A]n expert is permitted wide latitude to offer opinions, including those that are nоt based on firsthand knowledge or observation.” Daubert,
Expert testimony is not admissible if it is irrelevant Fed. R. Evid. 402. Under Federal Rule of Evidence 401, “evidence is relevant if it has any tendency to make a fact more or less probable than it would be without the evidence; and the fact is of consequence in determining the action.” Relevance of testimony often turns upon whether the testimony can help the judge understand the evidence or to determine a fact in issue. Daubert,
In summary, the Court, in its role as gatekeeper, will first determine whether the witness can be qualified as an expert by assessing whether he possesses relevant knowledge, skill, experience, training, or education. Second, the Court will assess whether his methodology is reliable and can be applied to the facts in issue. Third, the Court will consider the expert’s testimony to determine whether it is based on his expertise. And finally, the Court will consider whether such testimony is relevant and admissible.
John Paul Dick is qualified as an expert based on his knowledge, skill, experience, training, and education. The methodology Mr. Dick utilized is reliable and was appropriately applied to the facts in issue. The testimony offered by Mr. Dick was within his expertise, relevant, and admissible. The issues the Trustee raises with regard to Mr. Dick’s testimony will go to the weight that the Court gives to his conclusions. The Trustee Motion to Exclude, however, is denied.
Stephen Nichols is qualified as an expert based оn his knowledge, skill, experience, training, and education. The methodology Mr. Nichols utilized is reliable and was appropriately applied to the facts in issue. The testimony offered by Mr. Nichols was within his expertise, relevant, and admissi
V. REMAINING FACTUAL DETERMINATIONS
In order to evaluate the impact of the Trustee’s settlement with the Ruthven Defendants on the Trustee’s claims against Cianna, the Court must determine (1) the value of the Settlement Consideration, (2) the amounts of the Relevant Initial Transfers, which gave rise to the subsequent transfers to Cianna, and (3) an allocation of the Settlement Consideration across the Relevant Initial Transfers.
A. The Value of the Ruthven Settlement
The ■ Settlement Consideration consisted of [certain assets for which Cian-na and the Trustee have stipulated as to value, and othеrs which Cianna and the Trustee cannot agree on the value (the “Disputed Assets”). The Disputed Assets] are the only component of the Settlement Consideration that still needs to be valued by the Court.
The parties presented evidence from three fact witnesses and two expert witnesses regarding the value of the [Disputed Assets], but before addressing that evidence, the Court must address a few other issues that were raised in connection with the valuation of the Settlement Consideration. Specifically, the parties disagreed as to the appropriate date for the valuation of the [Disputed Assets] and also as to whether the [Disputed Assets] should be discounted to account for the expenses the Trustee has had to, and will have to, incur in connection with the acquisition and divestiture of the [Disputed Assets].
With regard to timing, the Trustee and the Ruthven Defendants closed their settlement аgreement on November 10, 2015, but the settlement agreement was retroactively effective as of September 9, 2015. The Trustee makes the point that he could not have sold the property received as part of the Settlement Consideration before the actual closing in November, but based on the effective date of the Settlement Agreement, the Trustee [derived benefits associated with the Disputed Assets] beginning in September when the [Disputed Assets] were legally transferred to the Trustee. Fluctuations in value after that date are not relevant in determining how much value was given as part of the settlement, and the Court will value the [Disputed Assets] as of the effective date of the settlement agreement.
With regard to the expenses associated with acquiring and liquidating the [Disputed Assets], the Trustee argues that the value of the Settlement Consideration must be considered in light оf the costs of converting it to cash. The Trustee presented evidence that [the Disputed Assets required considerable time and expense to acquire and liquidate]. The Court agrees that non-cash consideration is generally worth less to a liquidating trust than cash of the same nominal value. The problem that the Court runs into, however, is that the Trustee did not provide much evidence regarding how much of a discount the Court should apply to the [Disputed Assets’] market value. There was testimony regarding [the Trustee’s] time and effort, but there was no specific information regarding the amount of expenses incurred by the Trustee. Based on the Court’s own experience with dispositions of assets of this kind in bankruptcy, the Court believes a roughly five percent discount from the market value of the [Disputed Assets] is appropriate .to reflect the transaction costs
With the preliminary questions of thе date of valuation and the relevance of liquidation expenses resolved, the Court will now address the value of the [Disputed Assets], The witnesses that presented evidence regarding the value of the [Disputed Assets] were (1) the Trustee, [redacted] (2) [redacted] the former owner of the [Disputed Assets], (3) [an individual familiar with selling assets similar to the Disputed Assets at auction], (4) [redacted], the valuation expert for the Trustee, and (5) [redacted], the valuation expert for Cianna. The values assigned to the [Disputed Assets] range from approximately [redacted] to approximately [redacted]. In an affidavit dated April 29, 2016 and submitted to the District Court on June 2, 2016, the Trustee stated that the total value of the Settlement Consideration does not exceed [redacted], implying a maximum value of the [Disputed Assets] of [redacted].
[One witness testified that the value of the Disputed Assets could be increased if they were not sold as a single group, but in smaller lots.]
Tire remaining valuation testimony came from the experts [hired by Cianna and the Trustee]. As of September 2015, [the Trustee’s expert] valued the [Disputed Assets] at [redacted] and [Cianna’s expert] valued the [Disputed Assets] at [redacted]. The experts took different approaches to valuing the large number of [assets] included in the [Disputed Assets], and each offered a reasonable explanation for why they believed their approach was appropriate. Neither was perfect. During the hearing, it became apparent that the [data] that [Cianna’s expert] used in his valuation may have been too optimistic when compared to the actual results obtained between the time of his valuation and the time of the hearings. [The Trustee’s expert], however, admitted that for some [of the Disputed Assets], their true value lies
The Court finds that as of September 9, 2015, adjusted for the expenses of liquidation, the [Disputed Assets] had a fair market value of [redacted]. Including the remaining components of the Settlement Consideration, the Settlement Consideration is valued at [redacted].
B. The Relevant Initial Transfers
This Court has already found that there were $48,812,882.24 in fraudulent transfers to Ruthven. The parties have acknowledged that in all transactions relevant to Cianna, the Debtors transferred money to Ruthven, Ruthven transferred money to Cianna, and Cianna transferred money to landowners. Amended Joint Pretrial Order at ¶ 37 [Case No. 3; 12-CV-1318-B, Docket No. 140]. The only initial transfers that are relevant to application of the single satisfaction rule in this case (ie., the Relevant Initial Transfers) are those initial transfers made in transactions involving Cianna for which the Trustee is attempting to recover from Cianna as a subsequent transferee under section 550(a)(2).
There is a small disagreement regarding the total amount of the Relevant Initial Transfers. Cianna asserted the total amount of Relevant Initial Transfers was $28,596,328.09, but the Trustee calculates this amount to be $28,358,668.09. Both parties were relying on the Trustee’s records to determine this amount, but the Court will adopt the Trustee’s slightly lower amount, which is favorable to Cianna.
There is also a discrepancy regarding the amount of transfers to Cianna resulting from the Relevant Initial Transfers. Cianna uses $22,044,107.05,
The amount of each of the Relevant Initial Transfers was identified by the Trustee and is included in Exhibit A attached to this ruling.
C. An Allocation of the Settlement Consideration Across the Relevant Initial Transfers
Allocation of settlement proceeds to settled claims is inherently difficult. For one thing, settlements happen at various stages of litigation, and the claims will not have been fully litigated, leaving the Court with an incomplete record with which to evaluate the relative strengths of the claims. In addition, we are not just to trust the representations of the parties to the settlement, which are understandably self-
The Trustee argues that there was a high probability of success on all of the settled claims and none warrant a heavier weighting of the Settlement Consideration. Cianna argues that the transactions involving the [redacted], which were the transactions Cianna was involved with, were more problematic and deserve a greater allocation of the Settlement Consideration.
The Trustee testified that he did not think any claims were more or less valuable than others, but [the former owner] stated in a deposition that he thought the [redacted] (the claims for transactions involving Cianna) were tougher to defend, Cianna also points to the complaint in which the Trustee alleged that the [redacted] properties [involving Cianna] were worthless. Plaintiff’s Third Amended Complaint Against Ruthven Oil & Gas, LLC, Wendell Holland, the Wendell and Kari Holland Trust, and Cianna Resources, Inc. at ¶¶ 36-37 [Docket No. 94].
In this case, there was very little left to be litigated. The only remaining claims against the Ruthven Defendants were for fraudulent transfers. See Joint Pretrial Order at ¶ 81 [Docket No. 307]. The transfers to Ruthven have already been found to be avoidable pursuant to section 548(a)(1)(A) subject only to a potential affirmative defense in 548(c) if Ruthven could prove both that (1) it took for value and (2) it took in good faith. See Findings of Fact and Conclusions of Law [Docket No. 174]; Memorandum Opinion and Order [Case No. 3:12-CV-1318-B, Docket No. 100]. It appears that the Ruthven Defendants would have had significant difficulty showing good faith, and that difficulty would have been common to аll claims.
Ultimately, the Court finds that no special allocation of the Settlement Consideration is warranted in this case. The probability of success in litigation was not significantly different for the transfers based on the [redacted] than the transfers based on the [redacted]. The difficulties to be encountered in collection and the complexity, expense, inconvenience, and delay involved in the litigation would have been roughly the same for all of the claims against the Ruthven Defendants. As a result, the Court sees no reason to weigh the allocation more heavily toward the Relevant Initial Transfers, and instead the Settlement Consideration should be allocated proportionally across all of the claims that the Ruthven Defendants settled.
VI. APPLICATION OF FACTUAL DETERMINATIONS TO LEGAL STRUCTURE
The Ruthven Defendants settled claims related to $48,812,882.24 worth of initial transfers for Settlement Consideration worth [redacted]. With regard to Ciаnna, the Relevant Initial Transfers totaled $28,358,668.09, of which Cianna received $21,722,518.98 as a subsequent transferee.
Attachment
Exhibit A
Notes
. The original version of this ruling was sealed because it contained confidential set
. Civil Action No. 3:12-CV-1318-B, Docket No. 166.
. For the benefit of the parties and the District Court, the Court's oral ruling that was delivered on the record on August 9, 2016 is fully discussed in this ruling.
. In the event that the District Court disagrees and believes the Bankruptcy Court lacks authority to enter dais ruling, this Court asks that this ruling be construed as proposed findings of fact and conclusions of law.
. Prudential is a case both sides cite and rely upon.
. The Court does not believe this conflicts with the statement in Fezler v. Davis (In re Davis),
. See Joint Pretnal Order at ¶ 81 [Docket No. 307],
. Cianna cited CNB Int’l, Inc. v. Kelleher (In re CNB Int’l Inc.),
. Trustee’s Exhibit 26.
. Trustee’s Exhibit 25.
. Cianna’s Exhibit 4.
. Cianna also suggested that the Court should use this amount reduced by the amount of payments that Cianna paid to landowners based on Cianna’s "mere conduit” affirmative defense. Since the time this matter was briefed, however, the Court has granted summary judgment to the Trustee on Cianna’s "mere conduit” affirmative defense.