Janvey v. Democratic Senatorial Campaign Comm., Inc.

• Decision Date: 23 October 2012
• Docket Number: No. 11–10704.,11–10704.
• Citation: 699 F.3d 848
• Parties: Ralph S. JANVEY, in his capacity as Court–Appointed Receiver for the Stanford International Bank, Ltd., et al., Plaintiff–Appellee, v. DEMOCRATIC SENATORIAL CAMPAIGN COMMITTEE, INC.; National Republican Congressional Committee; Democratic Congressional Campaign Committee, Inc.; Republican National Committee; and National Republican Senatorial Committee, Defendants–Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

699 F.3d 848

Ralph S. JANVEY, in his capacity as Court–Appointed Receiver for the Stanford International Bank, Ltd., et al., Plaintiff–Appellee,

v.DEMOCRATIC SENATORIAL CAMPAIGN COMMITTEE, INC.; National Republican Congressional Committee; Democratic Congressional Campaign Committee, Inc.; Republican National Committee; and National Republican Senatorial Committee, Defendants–Appellants.

No. 11–10704.

United States Court of Appeals, Fifth Circuit.

Oct. 23, 2012.

Kevin M. Sadler, Scott Daniel Powers (argued), Baker Botts, L.L.P., Austin, TX, for Plaintiff–Appellee.

Robert P. Latham, Matthew C. Acosta, Jackson Walker, L.L.P., Mark A. Shank, Gruber, Hurst, Johansen, Hail & Shank, L.L.P., Dallas, TX, Brian G. Svoboda, John Michael Devaney, Marc Erik Elias (argued), John Kuropatkin Roche, Perkins Coie, L.L.P., Washington, DC, Noah Guzzo Purcell, Perkins Coie, L.L.P., Seattle, WA, for Defendants–Appellants.

Appeals from the United States District Court for the Northern District of Texas.

Before JOLLY, BENAVIDES and DENNIS, Circuit Judges.

DENNIS, Circuit Judge:

Ralph Janvey, the Receiver over Allen Stanford and his companies' assets (collectively, the Stanford Defendants),¹ brought this case under the Texas Uniform Fraudulent Transfer Act (“TUFTA”), Tex. Bus. & Com.Code § 24.001 et seq., to recover approximately $1.6 million in political contributions made to various political committees by the Stanford Defendants between 2000 and 2008. There are two Democratic committees—the Democratic Senatorial Campaign Committee (“DSCC”) and the Democratic Congressional Campaign Committee (“DCCC”) (“the Democratic Committees”)—and three Republican committees—the Republican National Committee (“RNC”), the National Republican Senatorial Committee (“NRSC”), and the National Republican Congressional Committee (“NRCC”) (“the Republican Committees”)—which, for convenience, we collectively refer to as “the Committees.” The district court granted summary judgment in favor of the Receiver, and the Committees appealed.

On appeal, the Committees advance three arguments. They are that (1) the Receiver may not stand in the shoes of the creditors of the Stanford Defendants as to the TUFTA claims, (2) the Receiver's action was untimely under TUFTA, and (3) federal campaign finance law preempts the Receiver's TUFTA claims. Because we conclude that (1) the Receiver may stand in the shoes of the creditors of the Stanford Defendants, (2) the Receiver's TUFTA claims were brought “within one year after the transfer[s] ... w[ere] or could reasonably have been discovered by the claimant,” Tex. Bus. & Com.Code § 24.010(a)(1), and (3) they are not preempted, we reject the Committees' arguments and, therefore, AFFIRM the judgment of the district court.

BACKGROUND

The Securities Exchange Commission (“SEC”) brought suit against the Stanford Defendants in 2009 for perpetrating an enormous Ponzi scheme. See Janvey v. Adams, 588 F.3d 831, 833 (5th Cir.2009). The district court appointed Janvey to be Receiver over the assets and the records of the Stanford Defendants (the Receivership Estate). The court “specifically directed and authorized [the Receiver] to ... [c]ollect, marshal, and take custody, control, and possession of all the funds, accounts, mail, and other assets of, or in the possession or under the control of, the Receivership Estate, or assets traceable to assets owned or controlled by the Receivership Estate, wherever situated.” The Receiver was also directed to file “such actions or proceedings to impose a constructive trust, obtain possession, and/or recover judgment with respect to persons or entities who received assets or records traceable to the Receivership Estate” with the same court.

On February 19, 2009 and pursuant to its directive, the Receiver filed the instant lawsuit to recover approximately $1.6 million worth of contributions made by the Stanford Defendants to the Committees. It is undisputed that the Stanford Defendants gave $950,500 to the DSCC; $238,500 to the NRCC; $200,000 to the DCCC; $128,500 to the RNC; and $83,345 to the NRSC. The Receiver contends that the Committees have to disgorge the above funds because the contributions were fraudulent transfers, given “with actual intent to hinder, delay, or defraud” creditors of the Stanford Defendants. See Tex. Bus. & Com.Code § 24.005(a).

The Committees each filed a motion to dismiss, and the Receiver and the Republican Committees moved for summary judgment. The district court granted the Receiver's motion for summary judgment and denied the motions to dismiss and the Republican Committees' motion for summary judgment. The court ruled that the Receiver stands in the shoes of the creditors of the Stanford Defendants and therefore may bring the TUFTA claims and determined that the Receiver's TUFTA actions were timely. The district court also concluded that federal campaign finance law² does not preempt the Receiver's state law claim. On the merits, the district court determined that summary judgment in favor of the Receiver was warranted because he had demonstrated that the Stanford Defendants gave contributions to the Committees with actual intent to defraud, as required by TUFTA. The district court was unconvinced that the statutory defense available for contributions taken “in good faith and for a reasonably equivalent value,” Tex. Bus. & Com.Code § 24.009(a), applied because the Committees failed to create a genuine issue of material fact regarding whether the contributions were given for a reasonably equivalent value.

The Committees timely appealed, raising three issues: (1) whether the Receiver may stand in the shoes of the creditors of the Stanford Defendants as to the TUFTA claims; (2) whether the Receiver's action was untimely under TUFTA; and (3) whether federal campaign finance law preempts the Receiver's TUFTA claims.

STANDARD OF REVIEW

We review de novo a district court's disposition of motions to dismiss and motions for summary judgment. E.g., LeClerc v. Webb, 419 F.3d 405, 413 (5th Cir.2005).

DISCUSSION

A.

The Committees first dispute the district court's conclusion that the Receiver stands in the shoes of the creditors of the Stanford Defendants and that he is therefore empowered to bring the TUFTA claims. We disagree and conclude that the Receiver has the authority to pursue the instant action on behalf of the creditors.

The Committees highlight that the district court relied on language from Janvey v. Alguire, 628 F.3d 164 (5th Cir.2010)( Alguire I), in reaching its conclusion that the Receiver may bring claims on behalf of the creditors of the Stanford Defendants. The Committees correctly note that this language does not appear in Janvey v. Alguire, 647 F.3d 585 (5th Cir.2011)( Alguire II), the opinion that replaced and superseded Alguire I. Nonetheless, although we reached a different conclusion in Alguire II,id. at 603–04, this is not because we concluded that the Receiver represented the company rather than the creditors.³ Thus, although Alguire II does not include the language on which the district court relied, it also does not reject this language or the reasoning underpinning it. ⁴ Moreover, we subsequently recognized, in Jones v. Wells Fargo Bank, N.A., 666 F.3d 955 (5th Cir.2012), that under Texas law—which also governs this appeal—“[a] receiver is ‘the representative and protector of the interests of all persons, including creditors, shareholders and others, in the property of the receivership.’ ” Id. at 966 (quoting Sec. Trust Co. of Austin v. Lipscomb Cnty., 142 Tex. 572, 180 S.W.2d 151, 158 (1944)). Thus, “ ‘when the receiver acts to protect innocent creditors ... he can maintain and defend actions done in fraud of creditors even though the corporation would not be permitted to do so.’ ” Id. (quoting Akin, Gump, Strauss, Hauer & Feld, L.L.P. v. E–Court, Inc., ––– S.W.3d ––––, 2003 WL 21025030 at *5 (Tex.Ct.App.2003)).⁵ Not only is Jones controlling, but its reasoning finds support in the decisions of several other circuits. See, e.g., Marion v. TDI Inc., 591 F.3d 137, 148 (3d Cir.2010); Wuliger v. Man. Life Ins. Co., 567 F.3d 787, 795 (6th Cir.2009); Donell v. Kowell, 533 F.3d 762, 776–77 (9th Cir.2008); Eberhard v. Marcu, 530 F.3d 122, 132–33 (2d Cir.2008); Scholes v. Lehmann, 56 F.3d 750, 753–54 (7th Cir.1995). Accordingly, we conclude that the Receiver represents the creditors, via the Stanford corporations, in pursuing the TUFTA claims.

B.

1.

Given that the Receiver may represent the creditors in pursuit of the TUFTA claims, the next question we must answer is whether the Receiver filed the instant action “within one year after the transfer[s] ... w[ere] or could reasonably have been discovered by the claimant.” Tex. Bus. & Com.Code § 24.010(a)(1).

“A defendant moving for summary judgment on the affirmative defense of limitations has the burden to establish that defense conclusively.” Johnston v. Crook, 93 S.W.3d 263, 269 (Tex.App.2002) (citing KPMG Peat Marwick v. Harrison Cnty. Hous. Fin. Corp., 988 S.W.2d 746, 748 (Tex.1999)). “Thus, the defendant must (1) conclusively prove when the cause of action accrued, and (2) negate the discoveryrule, if it applies and has been pleaded or otherwise raised, by proving as a matter of law there is no genuine issue of material fact about when the plaintiff discovered, or in the exercise of reasonable diligence should have discovered, the nature of its injury.” Id. (citing KPMG Peat Marwick, 988 S.W.2d at 748). “If the movant establishes that the statute of limitations bars the action, the non-movant must then adduce summary judgment proof raising a fact issue in avoidance of the statute of limitations.” Id. (citing KPMG Peat Marwick, 988 S.W.2d at 748).

“The discovery rule [in Tex. Bus. & Com.Code § 24.010] defers the accrual of a cause of action until the plaintiff knew or, through the exercise of reasonable diligence, should have known of the facts giving rise to the cause of action.”...