Hammond et al v. Evans et al

Filing 96

MEMORANDUM ORDER: 1) Pla's 50 MOTION to Compel against Wallingford Law, PSC is DENIED as moot. 2) Pla Jennie Scruggs' 49 MOTION for Partial Summary Judgment to Impress a Constructive Trust is DENIED without prejudice. Signed by Judge Karen K. Caldwell on 07/19/2021. (MDC) cc: COR

Case: 5:20-cv-00244-KKC Doc #: 96 Filed: 07/19/21 Page: 1 of 2 - Page ID#: 669

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF KENTUCKY
CENTRAL DIVISION
LEXINGTON
DEAN HAMMOND, et al.,

CIVIL NO. 5:20-244-KKC

Plaintiffs,
V.

MEMORANDUM ORDER

WILLIAM S. EVANS, III, et al.,
Defendants.
*** *** ***
This matter is before the Court on its own motion for case management purposes. In
related action, Case No. 5:20-CV-226, Commodity Futures Trading Commission v. William
S. Evans, III, et al., the Court has entered an order tentatively approving settlements
between Special Counsel Barry Hunter and Defendants Wallingford Law, PSC
(“Wallingford”), David Caldwell, and Carl and Joyce Patterson. However, in this matter in
particular, the record reflects that Plaintiffs’ Motion to Compel Discovery by Third-Party
Witness Wallingford remains pending. Based on the ongoing activity in the related action,
the Court perceives that this discovery issue is no longer in controversy. Accordingly, the
Court will deny the Plaintiffs’ Motion to Compel (DE 50) as moot.
Plaintiff Jennie Scruggs’ (“Scruggs”) Motion for Partial Summary Judgment to
Impress a Constructive Trust is also pending in this action. (DE 49). Here, Scruggs submits
that she deposited approximately five-million dollars1 to Defendants’ account at Ironbeam,
Inc. ending in 8734 and on Defendants’ account at Central Bank, ending in 0904. (Id.) She
William and Francis Hammond and Jennie Scruggs amended the complaint, on July 13, 2020, to
include a claim to impress a constructive trust for the benefit of Scruggs on $4,627,400 allegedly
deposited into and currently maintained in two of the accounts restrained by CFTC; namely
Ironbeam Inc. account ending in 8734 in the name of Frances Evans (the “Ironbeam Account”) and
Central Bank account ending in 0904 in the name of William Evans d/b/a Turning Point Investments
(the “Central Bank Account”). (DE 14 at 9).
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Case: 5:20-cv-00244-KKC Doc #: 96 Filed: 07/19/21 Page: 2 of 2 - Page ID#: 670

thus asks the Court to impress a constructive trust for the benefit of Scruggs on the two
accounts.
As one of several victims whose lives have been deeply impacted by the fraud
perpetrated by Defendants, the Court is sympathetic to Scruggs’ request for a constructive
trust. Unfortunately, however, given the pending forfeiture allegations in the criminal
matter, United States v. Evans, 5:20-CR-127, and the interplay between the civil forfeiture
action, United States v. All Funds On Deposit In Iron Beam, Inc., et al., 5:20-CV-408-KKC,
and the case brought by the Commodity Futures Trading Commission (“CFTC”), 5:20-CV226, the Court elects not to grant Scruggs this relief in the interim. Accordingly, the Court
will deny Plaintiff Jennie Scruggs’ Motion for Partial Summary Judgment (DE 49) without
prejudice.
In sum, the Court hereby ORDERS as follows:

1. Plaintiffs’ Motion to Compel against Wallingford Law, PSC (DE 50) is DENIED
as moot.

2. Plaintiff Jennie Scruggs’ Motion for Partial Summary Judgment to Impress a
Constructive Trust (DE 49) is DENIED without prejudice.
Dated July 19, 2021

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