The opinion
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
SL EC, LLC, et al., )
)
Plaintiffs, )
)
v. ) Case No. 4:18-CV-01377-JAR
)
ASHLEY ENERGY, LLC, et al., )
)
Defendants. )
MEMORANDUM AND ORDER
This matter is before the Court on Defendants’ Motion for Summary Judgment. (Doc. 201).
The motion is fully briefed and ready for disposition.1 For the reasons discussed below, the motion
will be granted in part and denied in part.
I. BACKGROUND2
This case concerns the purchase of a historic steam power plant in downtown St. Louis (the
“Plant”). The City of St. Louis assigned its right to purchase the Plant to Plaintiff SL EC, LLC
(“SLEC”), a company solely owned and controlled by Plaintiff Michael Becker (“Becker”). SLEC
created a wholly-owned subsidiary in Defendant Ashley Energy, LLC (“Ashley Energy”) to
purchase the Plant. Pursuant to a client agreement (the “Client Agreement”), SLEC retained Jim
Davis (“Davis”) of Plaintiff Davis & Garvin, LLC (“D&G”) to represent them in the Plant
transaction.
1 In reply, Defendants argue that this Court should strike Plaintiffs’ response for being tardy. (Doc. 209 at 1-2).
Plaintiffs’ response was due on July 22, 2021 (Doc. 185) but not filed until the early morning hours of July 23, 2021.
While the Court reminds Plaintiffs of their obligation to strictly comply with deadlines, it will exercise its discretion
and decline to strike Plaintiffs’ response.
2 Unless otherwise noted, all facts included in this section are admitted per Plaintiffs’ Response to Defendants’
Statement of Material Facts (“SMF”). (Doc. 207).
1
acquisition. Accordingly, in May 2016, Becker approached Defendant Mason Miller (“Miller”),
the managing member of Defendant Power Investments, LLC (“Power Investments”) and a partner
at Defendant Miller Wells, PLLC, a law firm (“Miller Wells”). Initially, the parties expected that
Power Investments and others would fund Ashley Energy’s purchase of the Plant in exchange for
some portion of the equity in Ashley Energy.
These plans deteriorated when SLEC and Becker encountered substantial financial
difficulty and even contemplated bankruptcy. On August 3, 2017, Davis informed Miller that
SLEC could not afford to retain any ownership in Ashley Energy. (Doc. 203-1). Instead, the parties
agreed that Power Investments would purchase Ashley Energy outright. The parties had already
coordinated financing of approximately $8,500,000 from Arena Investors, L.P. (the “Arena
Financing”), who is not a party to this litigation, to fund the acquisition. Over the following few
days, the parties hastily drafted and executed a Membership Interest Purchase Agreement
(“MIPA”) and Assignment and Assumption of Membership Interests Agreement (“Assignment
Agreement”). The undisputed portions of the MIPA provide that Power Investments would
purchase 100% of the equity in Ashley Energy in exchange for (i) $600,000 up front3 and (ii) a
contingent $1,100,000 payment (the “Contingent Payment”). The status of the Contingent
Payment is the key issue in this litigation.
Plaintiffs’ sprawling Second Amended Complaint (“SAC”) (Doc. 90) includes the
following counts:
3 The Court recognizes that the $600,000 up front payment actually consisted of three separate payments of $65,000
at time of closing, cancellation of a $335,000 loan at time of closing, and an additional $200,000 thirty days thereafter.
(Doc. 133 at §§ 1.A, 1.B, 1.C).
2
Against Ashley Energy: D&G alleges that Defendants have failed to pay legal fees
incurred in the Plant transaction.4
Count III(a)5 – Becker and SLEC’s Breach of Contract Claim Against Power
Investments: Becker and SLEC allege that Power Investments has breached
various provisions in the MIPA.
Count III(b) – Plaintiffs’ Fraudulent Conveyance Claim Against Defendants:
Plaintiffs allege that Defendants fraudulently conveyed approximately $479,970
from Ashley Energy to Miller and Miller Wells after closing.
Counts IV and V – Plaintiffs’ Claims for Discovery of Assets, Establishment
and Imposition of Constructive Trust, and to Pierce Corporate Veil: These
counts seek remedies in connection with Plaintiffs’ fraudulent conveyance claim in
Count III(b). Because the Court will grant summary judgment in favor of
Defendants on Count III(b), it will also dismiss these claims for associated
remedies.
Counts VI, VII – Becker and SLEC’s Breach of Contract Claim Against Power
Investments: Becker and SLEC allege that Power Investments has breached the
MIPA by failing to make the Contingent Payment.
Count VIII – Becker and SLEC’s Constructive Trust Claim Against Ashley
Energy: Becker and SLEC seek the remedy of imposition of a constructive trust in
connection with their breach of contract claim. Because the Court will deny
summary judgment as to certain of Becker and SLEC’s breach of contract claims,
it will also deny summary judgment as to this claim for an associated remedy.
Count IX – Becker and SLEC’s Tortious Interference Claim Against
Defendants: Becker and SLEC allege that Defendants tortiously interfered in
relation to an application by Ashley Energy for Property Assessed Clean Energy
(“PACE”) financing.
Count X – Becker and SLEC’s Breach of Mutual Release Claim Against Power
Investments: Becker and SLEC allege that Power Investments breached the mutual
release provision of the MIPA by pursuing litigation in Kentucky.
Defendants have filed counter-claims on related grounds (Doc. 115), and a jury trial is currently
set for October 18, 2021. (Doc. 185).
4 This Court has dismissed Counts I and II of the SAC with prejudice due to D&G’s discovery misconduct. (Doc.
212). Accordingly, Defendants’ motion for summary judgment will be denied as moot as to these counts.
5 The SAC duplicates Count III. This Court and the parties have consistently referred to the breach of contract claim
as Count III(a) and the fraudulent conveyance claim as Count III(b).
3
II. LEGAL STANDARD
Under Fed. R. Civ. P. 56, a movant is entitled to summary judgment if they can “show[]
that there is no genuine dispute as to any material fact” and they are “entitled to judgment as a
matter of law.” Fed. R. Civ. P. 56(a); see Meier v. City of St. Louis, 934 F.3d 824, 827-278 (8th
Cir. 2019). In determining whether summary judgment is appropriate, this Court views the
evidence in the light most favorable to the nonmovant. Osborn v. E.F. Hutton & Co., 853 F.2d
616, 619 (8th Cir. 1988). The nonmovant, however, “must do more than simply show that there is
some metaphysical doubt as to the material facts, and must come forward with specific facts
showing that there is a genuine issue for trial” Torgerson v. City of Rochester, 643 F.3d 1031, 1042
(8th Cir. 2011) (internal quotations omitted); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-
23 (1986).
III. ANALYSIS
A. MIPA Claims (Counts III(a), VI, VII, VIII, X)
In Counts III(a), VI, VII, and X, Plaintiffs allege that Defendants have breached various
provisions of the MIPA, most importantly by failing to make the Contingent Payment.
Unfortunately, despite multiple lawyers’ involvement in its negotiation, the parties disagree over
which document constitutes the final version of the MIPA. The versions proposed by each side
include material, potentially dispositive differences regarding the Contingent Payment and other
matters. Thus, the Court must sift through a seemingly frantic summer weekend of e-mails and
phone calls between the parties to determine, if possible, which document constitutes the official,
executed version of the MIPA for purposes of this litigation.
4
The negotiation of the MIPA included numerous e-mails and phone calls, sometimes just
minutes apart and often lacking important details. A detailed timeline of these events is necessary
to determine whether this Court can decide as a matter of law which document constitutes the
agreed upon MIPA. Prior to August 5, 2017, the parties had exchanged term sheets and generally
negotiated the Plant purchase.
• E-mail from Miller to Davis on August 5, 2017 at 8:09 A.M. (Doc. 207-2 at 5): On a
Saturday morning, Miller e-mails Davis and attaches a draft MIPA “reflecting the terms
of the general offer we’ve discussed.” Miller explains that he “need[ed] to get this done
today” and requests that Davis “please secure [Becker’s] signature as quickly as
possible.” The attached MIPA includes the following language regarding the
Contingent Payment in § 1.D:
o “Upon the earlier of a transaction resulting in: (a) the sale, merger or liquidation
of [Power Investments]; (b) the sale, merger or liquidation of Ashley [Energy]; or
(c) the repayment or refinancing of the Arena Financing (an “Exit Event”), [Power
Investments] shall pay the sum of $1,100,000 to SLEC (the “Final Payment”);
provided, however, that as a result of such Exit Event should [Power Investments]
receive total consideration less than $1,100,000, then the Final Payment shall be
equal to 50% of the total consideration received by [Power Investments] as a result
of the Exit Event.” (Id. at 7) (hereinafter “Version #1”).
• Response from Davis to Miller on August 5, 2017 at 10:05 A.M. (Doc. 203-1 at 130):
Davis responds with six comments, including the risk that “[r]efinancing may not result
in a cash out.” Davis proposes to address this “by adding that [Power Investments] will
make every effort to obtain cash out or that, in the event there is cash available, that it
will be used to pay the SLEC obligation.”
• Response from Miller to Davis on August 5, 2017 at 10:18 A.M. (Id. at 131): Miller
responds to each of the six comments with “[q]uick notes” and mentions he “will call
in a minute.” As to the refinancing, Miller states that he “[a]gree[s] with the ‘best
efforts’ approach” and mentions that if Power Investments “gets any distributions, [he
will] apply 50% against the SLEC debt.”
• Revised Draft from Miller to Davis on August 5, 2017 at 10:38 A.M. (Doc. 207-2 at
11): Miller sends Davis a revised MIPA supposedly “consistent with [his] notes” from
the 10:18 A.M. e-mail. He states this version is the “best [he] can do” and requests that
Davis “ask [Becker] to sign it . . . as soon as possible.” The attached draft includes the
following Contingent Payment provision, with changes from Version #1 bolded:
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o of [Power Investments]; (b) the sale, merger or liquidation of Ashley [Energy]; or
(c) the repayment or refinancing of the Arena Financing (an “Exit Event”), [Power
Investments] shall pay the sum of $1,100,000 to SLEC (the “Final Payment”);
provided, however, that as a result of such Exit Event should [Power Investments]
receive total consideration less than $1,100,000, then the Final Payment shall be
equal to 50% of the total consideration received by [Power Investments] as a result
of the Exit Event. [Power Investments] shall use its best efforts to obtain an
Exit Event that provides sufficient consideration to make the Final Payment.
Should [Power Investments] receive any profit distributions from Ashley
[Energy] prior to an Exit Event, 50% of any such distributions shall be paid
to SLEC and applied as a pre-payment to the Final Payment.” (Id. at 15)
(hereinafter “Version #2”).
• Response to Revised Draft from Davis to Miller on August 5, 2017 at 6:55 P.M. (Id. at
19): Davis attaches the signature page for the revised MIPA “as evidence of our general
agreement on the terms offered by Power Investments.” But Davis notes that, as
discussed, “there are still some areas that require further refinement, but due to the time
limitations, will have to be addressed as time and priorities permit.” Davis proceeds to
identify 13 issues requiring further revision or action, though none specifically concern
the disputed portions of the Contingent Payment provision. Davis ends the e-mail by
carefully explaining that he is “delivering the signature pages with the condition that
the above [13 issues] accurately reflects our agreement and that these additions and/or
changes will be made to the final draft of the [MIPA].” (Id. at 20).
• Response from Miller to Davis Regarding 13 Issues on August 5, 2017 at 7:14 P.M.
(Id. at 23): Miller’s response states: “These all seem acceptable. Thanks for getting this
done.”
• Follow-Up from Davis to Miller Confirming Agreement on August 6, 2017 at 10:49
A.M. (Id. at 26): The following morning, at the behest of Becker, Davis e-mails Miller
“to confirm [his] agreement to the additional terms/revisions as set forth in the email
yesterday.” Davis suggests they could “finalize the document when time permits,” but
unless any items required further discussion, he would “assume we have an agreement
on terms.”
• Confirmation to Agreement on Terms from Miller to Davis on August 6, 2017 at 10:58
A.M. (Id. at 27): Miller responds “[a]greed and confirmed,” reflecting his confirmation
of the MIPA incorporating Version #2 as well as the 13 issues set out in the e-mail sent
by Davis at 6:55 P.M. on August 5, 2017.
• New Version Sent from Davis to Miller on August 8, 2017 at 9:18 A.M. (Id. at 29):
Two days later, Davis sends Miller clean and redlined versions of the MIPA
“incorporating the changes which were previously discussed.” The revised version
includes the following Contingent Payment provision, with changes bolded:
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o the balance of $1,100,000 (the “Final Payment”) due to SLEC shall be paid
within thirty-six months from the Closing Date, or upon the earlier of a
transaction resulting in: (a) the sale, merger or liquidation of [Power Investments];
(b) the sale, merger or liquidation of Ashley [Energy]; or (c) the repayment or
refinancing of the Arena Financing ((a), (b), and (c) each being defined as an
“Exit Event”). [P]rovided, however, that if in the event that either (a) or (b)
above occurs first, and [ ] as a result of such Exit Event as described in (a) or
(b) [ ] [Power Investments] receives, after payment of the Arena Financing
debt, total consideration less than $1,100,000, then the Final Payment shall be
equal to 50% of the total consideration received by [Power Investments] as a result
of the Exit Event. [Power Investments] shall use its best efforts to obtain an Exit
Event that provides sufficient consideration to make the Final Payment. (e) Should
Mason Miller, [Power Investments], or any entity controlled or owned by
Mason Miller or [Power Investments], receive any salary, payment,
compensation, bonus, profit, distribution, dividend or other payment
(collectively “Distributions”) from Ashley [Energy] prior to an Exit Event, 50%
of any such Distributions shall be paid to SLEC and applied as a pre-payment to
the Final Payment.” (Id. at 32) (hereinafter “Version #3”).6
• Response to New Version from Miller to Davis on August 8, 2017 at 9:24 A.M. (Id. at
45): E-mailing from his phone approximately six minutes later, Miller responds by
noting “[t]wo minor changes” unrelated to the Contingent Payment provision. He states
that he can “send over a signed copy this morning” if Davis makes those changes.
• Reply from Davis to Miller on August 8, 2017 at 9:32 A.M. (Doc. 203-1 at 298): Davis
replies in full: “No problem, I’ll make the changes.” Davis is evidently referring to the
two minor changes identified by Miller in the prior e-mail.
• Phone Calls During the Morning of August 8, 2017: The record reflects that Davis and
Miller spoke on the phone twice during the morning of August 8, 2017, the calls lasting
only a few minutes each. (Doc. 207-1 at 8). The parties dispute the content of these
calls. Davis has stated that he and Miller “did not agree to any further revisions” to the
Contingent Payment provision. (Doc. 207-2 at 3). During his deposition, Davis
repeatedly indicated that he did not remember what was discussed during the call, but
then clarified that he and Miller “did not have any conversations about changing” the
Contingent Payment provision. (Doc. 207-1 at 13). Miller’s declaration squarely
contradicts this assertion, as Miller states that he “called Jim Davis to discuss the
language and to let him know that I would not agree to his proposed amended language
excluding refinancing as an Exit Event,” and that Miller and Davis settled on revised
language “to bring [the Contingent Payment provision] back in line with our original
agreement.” (Doc. 203-1 at 10). Miller further claims that Davis called back 45 minutes
later “confirming that SLEC and Becker had agreed with the above language returning
the terms back in line with our original agreement.” (Id.). Miller has also provided a
6 The MIPA including Version #3 incorporates other changes stemming from the 13 issues previously identified by
Davis. (Doc. 207-2 at 31-37).
7
Davis concerned the Contingent Payment provision. (Doc. 209-1).
• Follow-Up E-mail from Davis to Miller on August 8, 2017 at 12:05 P.M. (Doc. 207-2
at 47): Following these phone calls, Davis e-mails Miller a copy of the Assignment
Agreement and notes, “[a]s per our phone call,” that Davis had approved the MIPA e-
mailed that morning. Davis offered the Assignment Agreement “on the condition that
we receive an executed copy of the [MIPA].”
• Response from Miller to Davis on August 8, 2017 at 12:09 P.M. (Doc. 203-1 at 301):
Miller responds in full: “Confirmed. Did you send the revised [MIPA]? I’ll sign both
right now.” In his declaration, Miller insists that the “revised” MIPA referenced in his
e-mail meant an MIPA which would have incorporated the changes to the Contingent
Payment provision discussed in the phone calls that morning (among other edits). (Id.
at 11).
• Follow-Up from Miller to Davis on August 8, 2017 at 12:19 P.M. (Doc. 207-2 at 54):
Miller sends Davis signature pages for the MIPA “subject to making the changes we
discussed.” In his declaration, Miller again contends that the discussed changes
included revisions to the Contingent Payment provision. (Doc. 203-1 at 11). In his
deposition, Davis admits that there was no revised draft sent subsequent to the version
sent on the morning of August 8, 2017 at 9:18 A.M. (Doc. 207-1 at 10-11), even though
all parties agree that Miller had at minimum identified two required changes. (Doc.
207-2 at 45).
• Miller Mails Package of Closing Documents to Becker on August 15, 2017 (Id. at 11;
Doc. 203-1 at 121): One week later, Miller mails a copy of all closing documents to
Becker, including a copy of the allegedly final MIPA. The MIPA included in this
package incorporates another revised Contingent Payment provision. (Doc. 133).
Unsurprisingly, Plaintiffs deny that this is the final, agreed upon version. (Doc. 207 at
¶ 16). In the cover letter, Miller specifically notes that they had “never made the three
changes agreed on [August] 8th concerning paragraph 1(D), paragraph 1(G) and
paragraph 1(E), as well as insert the schedule A.” (Doc. 203-1 at 122). Miller explains
that he “went ahead and made those agreed to changes to conform to our agreement”
and re-attached the signature pages. (Id.). Defendants have also provided a copy of
Miller’s credit card statement reflecting a FedEx charge on the date of August 15, 2017.
(Id. at 123). Becker, meanwhile, states in a declaration that he never received the letter.
(Doc. 207-7 at ¶ 3). The MIPA included in the closing documents has the following
Contingent Payment provision, with changes from Version #3 bolded or struck out:
o Upon the payment to SLEC of the amounts set forth in A., B., and C. above, the
balance of $1,100,000 (the “Final Payment”) due to SLEC shall be paid within
thirty-six months from the Closing Date, or upon the earlier of a transaction
resulting in: (a) the sale, merger or liquidation of [Power Investments]; (b) the sale,
merger or liquidation of Ashley [Energy]; or (c) the repayment or refinancing of
the Arena Financing ((a), (b), and (c) each being defined as an “Exit Event”),
[P]rovided, however, that if in the event that either (a) or (b) above occurs first,
8
receives, after payment of the Arena Financing debt, total consideration less than
$1,100,000, then the Final Payment shall be equal to 50% of the total consideration
received by [Power Investments] as a result of the Exit Event. [Power Investments]
shall use its best efforts to obtain an Exit Event that provides sufficient
consideration to make the Final Payment. (e) After the closing of the Arena
Financing, [s]hould Mason Miller, [Power Investments], or any entity controlled
or owned by Mason Miller or [Power Investments], receive any salary, payment,
compensation, bonus, profit, distribution, dividend or other payment (collectively
“Distributions”) from Ashley [Energy] prior to an Exit Event, 50% of any such
Distributions shall be paid to SLEC and applied as a pre-payment to the Final
Payment. This paragraph shall not apply to any payments made to Miller
Wells PLLC.” (Doc. 133 at 2) (hereinafter “Version #4).
To synthesize: Plaintiffs propose that the final MIPA was sent on August 8, 2017 at 9:18
A.M. and includes Version #3 of the Contingent Payment provision. (Doc. 207-2 at 38-43).
Defendants respond that the final MIPA was not sent until August 15, 2017 and includes Version
#4 of the Contingent Payment provision, among other changes. (Doc. 133). Defendants also argue
that, at minimum, a contract which included Version #2 (and the additional 13 issues identified by
Davis) existed because the parties manifested their agreement to such terms. (Doc. 209 at 2-3).
Which version controls is critical because an Exit Event occurred in 2018 when Regions Bank
refinanced the Arena Financing loan. (Doc 207 at ¶ 19).
A jury will be in the best position to resolve the numerous factual issues raised by this
confusing negotiation. Both parties haphazardly sent signature pages without seeing a final
document reflecting the supposedly agreed upon terms. Plaintiffs still cannot produce a truly final
version of the MIPA which was sent to Defendants and incorporates the “two minor changes” both
sides acknowledge were accepted. Either Miller or Davis is wrong about what transpired during
the phone calls on the morning of August 8, 2017. A week after the transaction apparently closed,
Miller mailed Becker closing documents including yet another new MIPA with material changes
to key provisions, albeit changes allegedly agreed to during the August 8, 2017 phone calls. But
9
confirmation of receipt.
Under Missouri law, the essential elements of any contract are offer, acceptance, and
consideration. Baker v. Bristol Care, Inc., 450 S.W.3d 770, 774 (Mo. banc 2014) (citation
omitted).7 Offer and acceptance “require there to be a mutual agreement, i.e., a meeting of the
minds between the contracting parties, which means the parties meet upon and assent to the same
thing, in the same sense, and at the same time.” EM Med., LLC v. Stimwave LLC, No. ED 108965,
2021 WL 2420088, at *6 (Mo. Ct. App. June 15, 2021) (citations omitted); see also Kunzie v. Jack-
In-The-Box, Inc., 330 S.W.3d 476, 484 (Mo. Ct. App. 2010) (emphasis in original) (“A meeting
of the minds occurs when there is a definite offer and an unequivocal acceptance.”). In assessing
whether a meeting of the minds occurred, “we look to the parties’ objective manifestations of
intent.” Best Buy Builders, Inc. v. Siegel, 409 S.W.3d 562, 565 (Mo. Ct. App. 2013) (citation
omitted); see also Enter. Rent-A-Car Co. v. U-Haul Int’l, Inc., No. 4:03-CV-1480 CAS, 2007 WL
1063528, at *7 (E.D. Mo. Apr. 9, 2007) (“Defendants’ subjective intent is irrelevant as to whether
there was a meeting of the minds.”).
Material factual disputes prevent this Court from determining precisely when a meeting of
the minds existed as to the MIPA. There are three potential moments at which the parties may have
reached a meeting of the minds. First, in response to the proposed MIPA including Version #2,
Davis identified 13 substantive issues requiring further clarification and twice confirmed that such
changes would be made to the “final draft.” (Doc. 207-2 at 19-26). Under Missouri law, a contract
“does not exist without a definite offer and a ‘mirror-image’ acceptance. Any acceptance that
includes new or variant terms from the offer presented amounts to a counter-offer and a rejection
7 All proposed versions of the MIPA include a choice of law provision stating that Missouri law controls, and both
sides have consistently cited Missouri law in their briefing.
10
omitted). This version of the MIPA does not constitute a contract because both parties repeatedly
agreed that it did not reflect the final agreement. Davis’ equivocal acceptance was conditioned on
numerous edits to the MIPA. Miller subsequently confirmed that the parties would “finalize the
document when time permits,” further suggesting that the initial MIPA did not constitute a final
contract. (Doc. 207-2 at 26-27).
In reply, Defendants argue that the e-mails unquestionably establish “that the parties had
an agreement on the material terms of the MIPA” when Miller confirmed the 13 revisions on
August 6, 2017. (Doc. 209 at 3). This might be true, but it does not objectively establish the
existence of a contract when the parties have consistently referred to the future execution of a final
draft. Instead, the parties objectively manifested they had an agreement “on terms” but would
“finalize the document” later. (Doc. 207-2 at 26). Though it is difficult to find perfectly comparable
precedent, courts have frequently held that references to a future final draft indicate the parties did
not intend to enter a contract. See, e.g., TLT Const. Corp. v. RI, Inc., 484 F.3d 130, 135 (1st Cir.
2007) (citation omitted) (“[T]he fact that the parties contemplate the execution of a final written
agreement effects a strong inference that the parties do not intend to be bound by earlier
negotiations or agreements until the final terms are settled.”); Reprosystem, B.V. v. SCM Corp.,
727 F.2d 257, 262 (2d Cir. 1984) (collecting cases). The parties’ subsequent course of conduct –
namely, the exchange of additional drafts and negotiation over key provisions – provides further
evidence that no meeting of the minds existed. See Trendmasters, Inc. v. Walgreen Co., No. 95 C
5379, 1996 WL 422273, at *2-3 (N.D. Ill. July 24, 1996) (Noting that “proximity in time” of
subsequent negotiation following alleged agreement “negates any inferences of a prior meeting of
the minds.”); see also Radaszewski ex rel. Radaszewski v. Maram, No. 01 C 9551, 2006 WL
861243, at *2-3 (N.D. Ill. Mar. 29, 2006). Finally, even if this Court determined that an agreement
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agreement.
Second, on the morning of August 8, 2017, Davis sent a revised version of the MIPA
including Version #3 of the Contingent Payment provision and other substantial edits. (Id. at 29).
Miller responded by noting that two minor changes were required. Two phone calls between Miller
and Davis occur, though the parties offer completely contradictory summaries of the calls. Miller
proceeds to send signature pages “subject to making the changes we discussed.” (Id. at 54). It is
plausible that the parties reached an agreement during these phone calls. Because the parties
disagree as to the content of the calls, however, material factual disputes prevent this Court from
determining the precise nature of whatever contract existed at this juncture. A reasonable person
could not interpret Miller’s sending of the signature pages as an objective manifestation of intent
to accept the version sent by Davis that morning because Miller clearly offered the signatures
subject to additional changes being incorporated.
Finally, on August 15, 2017, Miller allegedly mails Becker a package containing yet
another revised MIPA, this time incorporating Version #4 of the Contingent Payment provision.
“Silence generally cannot be translated into acceptance” under Missouri law. Guidry v. Charter
Commc’ns, Inc., 269 S.W.3d 520, 528 (Mo. Ct. App. 2008) (citation omitted). In certain
circumstances, however, the manifestation of acceptance of an offer need not be made by the
spoken or written words; it may also come through the offeree’s conduct or failure to act. Moore
v. Kuehn, 602 S.W.2d 713, 718 (Mo. Ct. App. 1980) (citation omitted); see also Citibank (South
Dakota), N.A. v. Wilson, 160 S.W.3d 810, 813 (Mo. Ct. App. 2005). If Becker actually received
the revised version of the MIPA within the closing documents and proceeded to perform as if the
parties had executed a final agreement, a reasonable argument could be made that his inaction
constituted acceptance of the revised contract. But Becker insists that he never received the
12
that the MIPA included in the closing documents package constitutes an agreed upon contract.
“Whether there was a meeting of the minds is a question of fact for the fact finder.” Tom’s
Agspray, LLC v. Cole, 308 S.W.3d 255, 259 (Mo. Ct. App. 2010) (internal quotations omitted);
see also Miller v. Securitas Sec. Servs. USA Inc., 581 S.W.3d 723, 729 (Mo. Ct. App. 2019)
(citation omitted). Viewing the evidence in the light most favorable to Plaintiffs, a reasonable juror
could conclude that a meeting of the minds existed as to an MIPA incorporating Version #3 of the
Contingent Payment provision, but not the MIPA incorporating Version #4 (or vice versa).
Resolution of this question will turn primarily on credibility determinations, and such
determinations fall squarely within the province of the jury. See Keveney v. Mo. Mil. Acad., 304
S.W.3d 98, 105 (Mo. banc 2010) (citation omitted) (“The jury is the sole judge of the credibility
of witnesses and the weight of their testimony and may believe or disbelieve any portion of that
testimony.”); see also DocMagic, Inc. v. Mortg. P’ship of Am., LLC, No. 4:09-CV-1779 MLM,
2012 WL 263091, at *5 (E.D. Mo. Jan. 30, 2012) (“It was the jury’s function to weigh the evidence
and the credibility of the witnesses and it is not the court’s role to usurp this function.”).
Courts in this district have declined to grant summary judgment where factual issues
regarding formation exist, particularly when parties offer contrasting accounts of key events. See
Union Elec. Co. v. Gen. Elec. Int’l, Inc., No. 4:06-CV-319 ERW, 2007 WL 1125700, at *4 (E.D.
Mo. Apr. 16, 2007) (After discussing disagreement over whether phone call occurred, holding that
“as this provides conflicting testimony, an order of summary judgment in favor of Defendant
would be inappropriate on this issue.”); see also Crosby Legacy Co., LLC v. TechnipFMC LLP,
No. 18-10814-MLW, 2019 WL 5588993, at *8 (D. Mass. Sept. 13, 2019) (“The intent of the parties
is generally a question of fact because the determination of whether parties intended to be bound
must be premised on the totality of such expressions and deeds given the attendant
13
grant summary judgment in favor of Defendants on a given count if the claim fails under either
side’s proposed version.
Count III(a) – Becker and SLEC’s Breach of Contract Claim Against Power Investments
In Count III(a) of the SAC, Becker and SLEC allege that Power Investments breached
numerous provisions in the MIPA. Certain claims are duplicative of other counts in the SAC (e.g.,
breach of the mutual release provision). This Court will consider whether summary judgment is
warranted as to each of the alleged breaches while deferring analysis of those claims raised later
in the SAC.
First, Plaintiffs allege that Power Investments breached §§ 1.E and 5.A of the MIPA by
directing cash transfers (the “Cash Transfers”) totaling $479,970.00 to Miller and Miller Wells.
(Doc. 90 at ¶¶ 47, 77(a)). The proposed versions of § 1.E are relatively similar and provide that
Miller or Power Investments may not receive any distribution from Ashley Energy prior to an Exit
Event, otherwise 50% of such distribution must be applied as a pre-payment to SLEC. Power
Investments represents in § 5.A that except for the Arena Financing “there are no other agreements
or preferences regarding distributions or dividends, liens, encumbrances, or obligations of [Power
Investments] which would supersede or impair the ability of [Power Investments] to comply with
the terms of this Agreement, or the payments to the SLEC parties.” (Doc. 133 at 4; Doc. 207-2 at
41).
For the reasons discussed below as to Count III(b), summary judgment in favor of Power
Investments is warranted as to this claim. Becker’s deposition testimony and evidence in the record
unquestionably establishes that the Cash Transfers were agreed upon by all parties prior to the
closing. The Cash Transfers could not “impair the ability of [Power Investments] to comply with
14
motion for summary judgment, Plaintiffs have not offered any evidence contradicting the facts set
out by Defendants as to the Cash Transfers. Therefore, summary judgment will be granted as to ¶
77(a-b) of the SAC.
Second, Plaintiffs allege that Ashley Energy violated § 1.F by failing to deliver monthly
financial statements. (Doc. 90 at ¶ 77(c)). In all versions of the MIPA, however, § 1.F merely
provides that SLEC “shall be entitled to receive monthly financial statements.” (Doc. 133 at 2;
Doc. 207-2 at 39) (emphasis added). This Court agrees with Defendants that, under the plain,
unambiguous language of this provision, Power Investments was only required to provide monthly
financial statements upon request. (Doc. 204 at 15). This is consistent with follow-up language in
the provision stating that SLEC also had a “right to inspect the books and records.” (Doc. 207-2 at
39). Because SLEC has not claimed that it was denied the right to review financial statements or
inspect the books and records, there is no plausible allegation of breach. In response to a Statement
of Material Facts from Defendants that “SLEC never requested monthly financial statements,”
Plaintiffs only respond by “deny[ing] that they were required to make requests.” (Doc. 207 at ¶
45). This Court interprets this as an admission that no such requests were made and will
accordingly grant summary judgment in favor of Power Investments on this claim. The Court also
finds that Plaintiffs have abandoned this claim by entirely failing to address it in their response to
Defendants’ motion for summary judgment. See Satcher v. Univ. of Arkansas Pine Bluff Bd. of
Trustees, 558 F.3d 731, 735 (8th Cir. 2009).8
8 In Satcher, the Eighth Circuit held that “failure to oppose a basis for summary judgment constitutes waiver of that
argument.” 558 F.3d at 735. The Eighth Circuit recently affirmed that a plaintiff waives her claim when she fails to
oppose summary judgment arguments “because the non-moving party is responsible for demonstrating any genuine
dispute of material fact that would preclude summary judgment.” Paskert v. Kemna-ASA Auto Plaza, Inc., 950 F.3d
535, 540 (8th Cir. 2020) (citation omitted). Plaintiffs have completely failed to respond to numerous arguments raised
by Defendants, rendering Plaintiffs’ underlying claims as to those arguments waived.
15
to “release, waive, cancel and surrender the [Power Investments] Loan and Deed of Trust.” (Doc.
90 at ¶ 77(d)). Plaintiffs admit that Power Investments has represented that the loan and deed of
trust have been canceled but complain that Power Investments “has never returned the original
note and deed of trust, and as a result SLEC and Becker cannot know that the originals have not
been transferred to a third party.” (Doc. 207 at ¶ 44). Plaintiffs offer no legitimate grounds for their
concern that the note and deed of trust have not been canceled and have certainly not done “more
than simply show that there is some metaphysical doubt as to the material facts.” Torgerson v. City
of Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011) (internal quotations omitted). Summary
judgment will be granted in favor of Power Investments as to ¶ 77(d) of the SAC.9
Fourth, Plaintiffs allege that Power Investments “failed to pay the vendors as agreed” (Doc.
90 at ¶ 77(e)) in violation of § 1.G of the MIPA, which provides that as part of the consideration,
Power Investments agreed to assume responsibility for certain expenses and obligations incurred
by SLEC and outlined in Exhibit A.10 At the outset, the Court notes that the proposed final version
of the MIPA offered by Plaintiffs does not actually include Exhibit A; Miller attached Exhibit A
when he allegedly sent the closing documents package on August 15, 2017. Beyond that, Plaintiffs
have not clarified which vendors Power Investments failed to pay, nor suggested that those vendors
have come after Plaintiffs due to Power Investments’ supposed failure. In fact, Plaintiffs did not
offer any response to Defendants’ motion for summary judgment on this issue. Therefore, this
Court finds that summary judgment in favor of Power Investments is warranted as to ¶ 77(f)
9 Defendants also claim that Becker never actually provided originals of these documents. In a post-closing e-mail,
Miller mentioned that he did “not have the originals” because they “were never delivered” to him by Becker. (Doc.
203-1 at 256).
10 Count III(a) is only directed against Power Investments, but one of the “two minor changes” identified by Miller
and allegedly agreed to by Davis on August 8, 2017 was that Ashley Energy would accept these obligations.
16
trial and, alternatively, have abandoned this claim. See Satcher, 558 F.3d at 735.
Fifth, Plaintiffs allege in ¶ 77(f) of the SAC that, again pursuant to § 1.G of the MIPA,
Power Investments agreed to provide a schedule for reimbursement to SLEC for expenses related
to Dan Dennis. In Plaintiffs’ version of the MIPA, § 1.G(a) states that as to Dan Dennis, Power
Investments “shall propose a schedule of repayment and reimbursement to SLEC to occur within
seven (7) months from the Closing Date” regarding $87,000 owed. (Doc. 207-2 at 40). The parties
simply do not address this allegedly outstanding $87,000 payment in their briefing. E-mails
attached to Plaintiffs’ SAC confirm the parties’ apparent intent that Defendants would reimburse
Becker for $87,000 advanced to Dan Dennis, but such repayment would be due in seven months
so that the Plant would be “into cold enough weather to have excess cash flow.” (Doc. 90-1 at 16-
17). In an e-mail after the closing, Miller confirmed that Defendants would “honor the obligations”
of the MIPA by paying Dan Dennis but noted that they had more time to comply. This Court will
deny summary judgment as to ¶ 77(f) of the SAC because Defendants have not put forth any
argument as to this payment.
Sixth, Plaintiffs allege in ¶¶ 77(g-h) and 78(f) of the SAC that Power Investments breached
the mutual release provision by pursuing litigation in Kentucky. This claim is duplicative of Count
X, and summary judgment will be granted in favor of Power Investments for the reasons discussed
below as to Count X. To summarize, summary judgment will be granted in favor of Power
Investments as to all claims raised in Count III(a) of the SAC with the exception of ¶ 77(f), which
contends that Power Investments has breached § 1.G(a) of the MIPA by failing to reimburse SLEC
for $87,000 owed to Dan Dennis.
17
In Count VI, Becker and SLEC again allege breach of contract against Power Investments,
this time for failing to make the $1.1 million Contingent Payment (¶ 119) or provide monthly
financial statements and notice of the Regions Bank refinancing (¶ 120). The second claim is
essentially duplicative of the breach of contract claim raised in ¶ 77(c) of Count III(a), and
summary judgment will be granted in favor of Power Investments for the same reasons discussed
above.
The claim concerning the Contingent Payment is the real thrust of this lawsuit, and the
Court must deny summary judgment because this question goes squarely to which version of the
MIPA controls. Both parties agree that an “Exit Event occurred in 2018 when the Arena Financing
was refinanced by Regions Bank.” (Doc. 207 at ¶ 19). Both proposed versions of the MIPA identify
three potential Exit Events: (a) a sale, merger, or liquidation of Ashley Energy; (b) a sale, merger,
or liquidation of Power Investments; and (c) a refinancing of the Arena Financing. Under
Defendants’ MIPA, which incorporates Version #4 of the Contingent Payment provision, any Exit
Event in which Power Investments received (after payment of the Arena Financing debt) less than
$1.1 million would result in the Contingent Payment being reduced from $1.1 million to 50% of
the total consideration received. (Doc. 133 at 2). Under Plaintiffs’ version of the MIPA, which
incorporates Version #3 of the Contingent Payment provision, only Exit Events (a) and (b) would
potentially result in such a reduction of the Contingent Payment provision, while refinancing of
the Arena Financing is specifically carved out. (Doc. 207-2 at 39). Because both parties agree that
that the 2018 Regions Bank refinancing constituted an Exit Event, which MIPA controls is
dispositive of the Contingent Payment claim and this Court must deny summary judgment.11
11 Plaintiffs also argue that summary judgment is not warranted even if this Court accepts Defendants’ version of the
MIPA because Ashley Energy received additional consideration through the Regions Bank refinancing. Specifically,
Plaintiffs claim that pursuant to the Loan Services Agreement (“LSA”) with Regions Bank (Doc. 207-3), Ashley
18
In Count VII of the SAC, Becker and SLEC again allege that Power Investments breached
the MIPA. This time, Plaintiffs argue that the Arena Financing itself constituted a sale of Ashley
Energy and therefore an Exit Event under the Contingent Payment provision of the MIPA. (Doc.
90 at ¶¶ 121-131). Simply put, Plaintiffs’ argument would result in a nonsensical interpretation of
the MIPA. See Storey v. RGIS Inventory Specialists, LLC, 466 S.W.3d 650, 655 (Mo. Ct. App.
2015) (citation omitted) (“It is preferable to attribute a reasonable meaning to each clause and
harmonize all provisions, rather than leave some provisions nonfunctional or nonsensical.”).
Under Plaintiffs’ own proposed version of the MIPA, potential Exit Events include the sale
or merger of Power Investments, the sale or merger of Ashley Energy, and repayment or
refinancing of the Arena Financing. In Count VII, Plaintiffs argue that the Arena Financing itself,
not its refinancing by Regions Bank, constituted a sale of Ashley Energy. Plaintiffs have admitted,
moreover, that “Power Investments received no payment as a result of the Arena Financing and
the Arena Financing remained due” until it was paid back through the Regions Bank refinancing.
(Doc. 207 at ¶ 24). There is no reasonable interpretation of either parties’ proposed MIPA
permitting a finding that the Arena Financing itself constituted a sale of Ashley Energy under §
1.D. Plaintiffs have also abandoned this argument by entirely failing to respond to Defendants’
motion for summary judgment on this count. See Satcher, 558 F.3d at 735. For these reasons,
summary judgment will be granted in favor of Power Investments on Count VII of the SAC.
Energy obtained (i) a $1 million line of credit and (ii) $409,183.19 to advance to parties involved in the refinancing
transaction. This Court declines to address this argument considering it presents clear issues of fact and Count VI will
proceed regardless.
19
In Count X of the SAC, Plaintiffs contend that Power Investments breached § 2 of the
MIPA by filing a civil lawsuit in Kentucky alleging various causes of action relating to the Plant
acquisition. (Doc. 90 at ¶¶ 171-75). Both versions of the MIPA include § 2, which is entitled
“Mutual Release” and provides that all parties release each other from “any and all past, present,
or future demands, actions causes of action . . . by reason of and/or related to Ashley [Energy], the
[ ] Plant, the [Assignment] Agreement, and the [Power Investments] Loan and Deed of Trust.”
Prior to the start of litigation in this Court, Power Investments brought claims against SLEC and
Becker in Kentucky state court for fraudulent inducement and fraudulent misrepresentation (Count
I), unjust enrichment (Count II), and declaratory judgment (Count III) (generally, the “Kentucky
Action”). (Doc. 203-1 at 16-32; Doc. 207 at ¶¶ 47-49).12
Power Investments argues that no element of the Kentucky Action violates the mutual
release provision because a contract cannot waive claims for fraudulent inducement (Count I), the
unjust enrichment stemmed directly from the alleged fraud (Count II), and the mutual release
provision specifically states that “nothing in this paragraph shall be construed to release any right
of the Parties to enforce the terms” of the MIPA (Count III). (Doc. 204 at 20-21). Plaintiffs
essentially respond by attempting to distinguish the precedent offered by Power Investments.
Under Missouri law, parties “may not, by disclaimer or otherwise, contractually exclude
liability for fraud in inducing the contract.” Hess v. Chase Manhattan Bank, USA, N.A., 220
S.W.3d 758, 767 (Mo. banc 2007); see also Robson v. Duckpont Ltd., 4:19-CV-1862-SRC, 2021
WL 1222429, at *6 (E.D. Mo. Mar. 31, 2021). Plaintiffs argue that this rule only applies to “general
releases” and “cannot be analogized to the mutual release” included in the MIPA. (Doc. 208 at 9).
12 This Court previously discussed the Kentucky Action in substantial detail when addressing Defendants’ motion to
dismiss. (Doc. 89).
20
in Hess broadly recognizes that parties cannot, “by disclaimer or otherwise,” release claims for
fraudulent inducement. Id. (emphasis added). It is readily apparent, and Plaintiffs do not explicitly
deny, that Counts I and II of the Kentucky Action concern Power Investments’ fraudulent
inducement claim. The unjust enrichment claim includes minimal additional factual allegations
but instead seeks damages for SLEC and Becker’s alleged fraudulent inducement. (Doc. 203-1 at
30). Finally, Plaintiffs offer no response to Defendants’ reasonable argument that the mutual
release clause expressly permits Count III of the Kentucky Action. Because Missouri law does not
recognize the contractual release of fraudulent inducement claims and the MIPA permits the
declaratory judgment claim, this Court determines as a matter of law that Power Investments has
not breached § 2 of the MIPA. Therefore, summary judgment will be granted in favor of Power
Investments on Count X of the SAC.
B. Claims Concerning D&G’s Legal Fees (Counts I and II)
Because this Court has dismissed Counts I and II with prejudice as a sanction for D&G’s
intentional destruction of discoverable evidence (Doc. 212), Defendants’ motion for summary
judgment will be denied as moot as to Counts I and II.
C. Fraudulent Conveyance (Counts III(b), IV, V)
In Count III(b) of the SAC, Plaintiffs allege that Ashley Energy fraudulently transferred
$479,970 to Miller and Miller Wells on August 10, 2017. (Doc. 90 at ¶¶ 80-95). Plaintiffs seek to
void this transfer pursuant to MO. REV. STAT. § 428.039. Though the SAC does not cite the
particular statute, MO. REV. STAT. § 428.024.1 provides that a transfer is fraudulent as to a creditor
when made: (1) with actual intent to hinder, delay, or defraud any creditor of the debtor; or (2)
without receiving a reasonably equivalent value in exchange for the transfer or obligation, and the
21
remaining assets of the debtor were unreasonably small in relation to the business or transaction;
or (b) intended to incur, or believed or reasonably should have believed that he would incur, debts
beyond his ability to pay as they became due. The statute identifies 11 “badges of fraud” courts
may consider when assessing intent. MO. REV. STAT. § 428.024.2.13
Whether a transferor had fraudulent intent is a question of fact. See Curtis v. James, 459
S.W.3d 471, 475 (Mo. Ct. App. 2015). But “[i]ntent to defraud must be shown by clear and
convincing evidence,” Birkenmeier v. Keller Biomedical, LLC, 312 S.W.3d 380, 389 (Mo. Ct.
App. 2010), and “[f]raud is never presumed when the transaction may fairly be reconciled with
honesty.” Higgins v. Ferrari, 474 S.W.3d 630, 636 (Mo. Ct. App. 2015) (citation omitted).
“Fraudulent transfer law focuses on the intent of the debtor. If the debtor transfers its assets with
the intent to defraud its creditors, the transfer can be avoided as fraudulent.” Ritchie Cap. Mgmt.,
LLC v. Stoebner, 779 F.3d 857, 862 (8th Cir. 2015). Generally, “[f]or a transfer to be found
fraudulent, several indicia of fraud must be shown. More than one badge of fraud must be present.”
Birkenmeier, 312 S.W.3d at 389 (citation omitted).
At the outset, the Court finds that Plaintiffs have admitted multiple key statements of
material fact. Pursuant to E.D. Mo. L.R. 4.01(E), every memorandum in opposition to a motion
for summary judgment must include a response to the statement of material facts. “All matters set
forth in the moving party’s Statement of Uncontroverted Material Facts shall be deemed admitted
13 The badges of fraud are: (1) the transfer or obligation was to an insider; (2) the debtor retained possession or control
of the property after the transfer; (3) the transfer or obligation was disclosed or concealed; (4) before the transfer was
made or obligation was incurred, the debtor had been sued or threatened with suit; (5) the transfer was of substantially
all the debtor’s assets; (6) the debtor absconded; (7) the debtor removed or concealed assets; (8) the value of the
consideration received by the debtor was reasonably equivalent to the value of the asset transferred or the amount of
the obligation incurred; (9) the debtor was insolvent shortly after the transfer was made or the obligation was incurred;
(10) the transfer occurred shortly before or shortly after a substantial debt was incurred; and (11) the debtor transferred
the essential assets of the business to a lienor who transferred the assets to an insider of the debtor. MO. REV. STAT. §
428.024.2.
22
its SMF, Defendants include key statements regarding the Cash Transfers at issue and offer citation
to affidavits and other exhibits as supporting evidence. (Doc. 203 at ¶¶ 39-43). Plaintiffs offered
the following response to each statement: “Plaintiff objects that this purported fact is not
adequately supported as required by Rule 56, in that the exhibits cited . . . do not support this
statement. The assertions in the motion are meaningless unless supported as provided for by rule.
Jacobson v. Maryland Cas. Co., 336 F.2d 72, 75 (8th Cir. 1964).” This response is insufficient,
includes no citations to contrary evidence, and ignores that Defendants included clear citations to
supporting evidence. Accordingly, the Court finds that Plaintiffs have admitted ¶¶ 39-43 of
Defendants’ Statement of Material Facts. See Wagner v. Brown, No. 4:15-CV-1277-JAR, 2017
WL 3433630, at *1 n.2 (E.D. Mo. Aug. 10, 2017). As to ¶ 43, in which Defendants state that as a
result of the Cash Transfers “Becker and SLEC no longer owe the $479,970 to Mason Miller and
Sam Francis,” Plaintiffs actually offer no response whatsoever. (Doc. 207 at ¶ 43).
Considering the admitted facts and deposition testimony by Becker, a reasonable jury could
not conclude that the Cash Transfers were made with fraudulent intent or without receiving any
consideration. The Cash Transfers totaled $479,970 and consisted of three separate (re)payments:
(1) $10,980 advance by Miller on the Plant’s natural gas bill; (2) $335,638.77 in cancellation of a
promissory note; and (3) $133,251.23 in fees due to Power Investments. (Doc. 149 at 17). The
undisputed material facts establish that SLEC and Becker owed this aggregate amount to Power
Investments, Miller, and Sam Francis. (Doc. 207 at ¶ 41). The undisputed facts further establish
that Plaintiffs “negotiated for the payment of $479,970 of Becker and SLEC’s debt” as part of the
Plant acquisition. (Id. at ¶ 42). Finally, the undisputed facts provide that as a result of the Cash
Transfers, Becker and SLEC no longer owe $479,970 to Mason Miller and Sam Francis. In short,
23
expected repayment of money owed and lacked any fraudulent intent.
The following exchange during Becker’s deposition eliminates any potential doubt on this
issue:
QUESTION: Mr. Becker, there was a discussion, I think in the complaint you
asserted that Mason Miller made payments to, and received payments that you
called fraudulent transfer. I’d like to ask you about the three payments that were,
that that was a part of. Do you agree that SLEC and Mike Becker owed Mason
Miller roughly, roughly $300,000 as part of this transaction?
ANSWER: Yes.
QUESTION: And do you agree that SLEC and Mike Becker owed Sam Francis
approximately somewhere between 130 and $200,000 in, loan proceeds? Or in –
owed them a loan amount of or payment amount of 130 to like $200,000 roughly?
ANSWER: Yes.
. . .
QUESTION: During the closing period, wasn’t it true that to keep the gas, to keep
the gas flowing, there was a requirement, an ask of Mason Miller to pay $10,000 to
the gas company to cover the closing days? Is that true?
ANSWER: I’d have to take a look at that, do you have that, that document in front
of you?
QUESTION: You don’t recall whether Mason Miller was asked to pay for the gas
for Ashley Energy to keep, keep the lights on and the energy going?
ANSWER: I do, yes, yes.
QUESTION: Okay.
ANSWER: There was, there was a payment, mm-hmm.
QUESTION: After the – isn’t it true that after the closing, you no longer owe Power
Investments and Mason Miller the roughly $300,000?
ANSWER: That is true, he was paid back in full with interest; yes sir.
QUESTION: Okay. And, and isn’t it true that after the closing Sam Francis also
you no longer, you and SLEC no longer owe the Sam Francis amount, as well?
24
ANSWER: That is true.
QUESTION: And the same thing for the gas bill, you don’t owe any money for the
gas bill, the $10,000, roughly $10,000 gas bill?
ANSWER: No.
QUESTION: Okay, so you received the benefit of not owing these things by virtue
of the closing?
ANSWER: Yes, sir. (Doc. 203-1 at 40-42).
In this exchange, Becker fully admits that he and SLEC owed debts to Miller and Sam Francis,
and that the Cash Transfers cleared the debts. The Court cannot comprehend how Plaintiffs can
plausibly allege that the Cash Transfers were fraudulent despite repeatedly admitting that they
constituted repayment for agreed upon debts. Plaintiffs offer a mere two sentences in response on
this issue, contending that Defendants’ material facts are unsupported and “there is no explanation
for why Miller was using funds borrowed by Ashley to repay debts owed to himself.” (Doc. 208
at 8). The undisputed material facts establish, however, that Plaintiffs substantially benefitted from
the Cash Transfers and all parties contemplated the transfers in advance of the closing.
Briefly considering the badges of fraud, Plaintiffs allege in the SAC that (a) the Cash
Transfers were made to an insider; (b) Ashley Energy transferred all of its available cash; (c)
Ashley Energy received no consideration; (d) Ashley Energy was insolvent after the Cash
Transfers; and (e) the Cash Transfers were made shortly before Ashley Energy incurred substantial
debt. (Doc. 90 at ¶ 91). While the Cash Transfers were made to an insider, no other badges of fraud
identified by Plaintiffs suggest fraudulent intent. There is no evidence that Ashley Energy
transferred all available cash or became insolvent. The record firmly establishes that the Cash
Transfers constituted consideration for cancellation of outstanding loans owed by Becker and
SLEC, Ashley Energy’s prior owners. The incurrence of the Arena Financing has no bearing on
25
the Cash Transfers. See In re Wright, 611 B.R. 319, 326 (Bankr. W.D. Mo. 2019) (finding that
certain badges of fraud, while technically present, had “logical explanations”). Missouri precedent
clearly provides that “the presence of one badge alone does not support a finding of actual intent
to defraud.” In re Seitz, 400 B.R. 707, 714 (Bankr. E.D. Mo. 2008). Considering the badges of
fraud, a reasonable factfinder could not conclude that the Cash Transfers were made with
fraudulent intent.
When previously denying summary judgment on this count, the Court stated that the Cash
Transfers “may not have been inherently fraudulent, but instead only fraudulent to the extent that
Ashley Energy intended to prevent Becker, SLEC, and D&G from subsequent recovery and
potentially violate § 5.A of the MIPA.” The undisputed facts now establish, however, that the Cash
Transfers constituted repayment of legitimate, negotiated debts, and all parties expected the Cash
Transfers to be made following closing. (Doc. 203-1 at 86, 104-109, 114). Ultimately,
“[f]raudulent transfer law focuses on the intent of the debtor.” Stoebner, 779 F.3d at 862. Having
extensively considered the undisputed material facts surrounding the Cash Transfers and analyzed
the badges of fraud, this Court will grant summary judgment in favor of Defendants on Count
III(b) of the SAC.
D. Tortious Interference (Count IX)
In Count IX of the SAC, Plaintiffs allege that Defendants have committed tortious
interference. Plaintiffs claim that Ashley Energy applied for and obtained PACE funding from the
Clean Energy Development Board of the City of St. Louis and failed to disclose the Kentucky
Action or general disputes relating to the MIPA. Plaintiffs confusingly summarize their claim by
stating that as “a direct result of Defendant Miller, Miller Wells, and Ashley [Energy’s] intentional
26
failed to pay” the Contingent Payment. (Doc. 90 at ¶ 169).
A claim for tortious interference of contract under Missouri law requires “(1) a contract or
valid business expectancy; (2) defendant’s knowledge of the contract or relationship; (3) a breach
induced or caused by defendant’s intentional interference; (4) absence of justification; and (5)
damages.” Bishop & Assocs., LLC v. Ameren Corp., 520 S.W.3d 463, 472 (Mo. banc 2017). This
Court is unclear how Plaintiffs could have any claim for tortious interference as to alleged
misstatements by Defendants in the course of obtaining the PACE funding. Summary judgment
will be granted on Count IX because Plaintiffs have offered no logical connection between the
PACE funding and the alleged breach of the MIPA. Alternatively, this Court grants summary
judgment in favor of Defendants on Count IX because Plaintiffs failed to offer any response to
Defendants’ motion on this issue and thereby abandoned the claim. See Satcher, 558 F.3d at 735.14
IV. CONCLUSION
Construing all evidence in the light most favorable to Plaintiffs, this Court finds that
genuine disputes of material fact require a jury to answer one key factual question: at what point
did the parties have a meeting of the minds on the MIPA, and therefore which version of the
MIPA controls? Because genuine disputes of material fact exist on this issue, summary judgment
will be denied as to Counts III(a) (as to ¶ 77(f) only) and VI of the SAC. Summary judgment will
also be denied as to Count VIII, which seeks remedies in connection with the alleged breach of
contract.
14 The Court also notes that, as a matter of law, Miller cannot be held liable for tortious interference as to the MIPA
because he was signatory to the MIPA as an officer of Power Investments. See Farrow v. Saint Francis Med. Ctr.,
407 S.W.3d 579, 602 (Mo. banc 2013)
27
As to the remainder of the SAC, however, summary judgment in favor of Defendants is
appropriate regardless of how a jury resolves this outstanding factual question. In Counts III(a)
(except as to § 77(f) of the SAC), VII, IX, and X, Plaintiffs make claims for breach of contract
which fail as a matter of law under any version of the MIPA. Plaintiffs’ fraudulent conveyance
claim (Count III(b)) cannot succeed because the undisputed material facts demonstrate that the
Cash Transfers were legitimate, negotiated repayments of outstanding debts as agreed upon by
the parties. Counts IV and V merely seek remedies in connection with the fraudulent conveyance
claim. Finally, Plaintiffs have failed to explain how Defendants’ alleged misstatements in the
course of obtaining PACE funding establish a claim for tortious interference as to the MIPA
(Count IX). Plaintiffs have abandoned many of these claims by declining to respond to
Defendants’ arguments. The Court will grant summary judgment in favor of Defendants on
Counts III(a) (except as to ¥ 77(f)), II(b), IV, V, VIL, IX, and X.
Accordingly,
IT IS HEREBY ORDERED that Defendants’ Motion for Summary Judgment (Doc. 201)
is GRANTED in part and DENIED in part:
e Summary judgment is GRANTED in favor of Defendants on Counts III(a) (except as to J
77(f) of the SAC), TI(b), IV, V, VI, IX, and X, and such counts are DISMISSED with
prejudice.
e Summary judgment is DENIED as moot as to Counts | and II. (Doc. 212).
e Summary judgment is DENIED in all other respects. Therefore, the only counts remaining
in the SAC are Count III(a) (as to § 77(f) only), Count VI, and Count VIII.
Dated this 21st day of September, 2021.
UNITED STATES DISTRICT JUDGE
28