1 

 IN THE UNITED STATES DISTRICT COURT 

 FOR THE SOUTHERN DISTRICT OF ALABAMA 

 SOUTHERN DIVISION 

PARSONS & WHITTEMORE ) 

ENTERPRISES CORPORATION, ) 

 ) 

Plaintiff, ) 

 ) 

vs. ) CIVIL ACTION NO. 09-631-CG-B 

 ) 

CELLO ENERGY, LLC, et al., ) 

 ) 

Defendants, ) 

 ) 

ORDER

On September 25, 2009, Parsons and Whittemore Enterprises Corporation (“P&W”) 

brought a lawsuit against Cello Energy, LLC (“Cello”), Boykin Trust, LLC (“Boykin Trust”), 

Vesta Venture, L.L.C. (“Vesta”), Forest Technologies, LLC (“Forest Technologies”), Jack W. 

Boykin (“Jack Boykin”), Lois Anne Cowin Boykin (“Lois Boykin”), Allen Boykin, and Elisa 

Boykin Rambo (“Elisa Rambo”) pursuant to the Alabama Uniform Fraudulent Transfer Act 

(“AUFTA”) to “avoid and/or to prevent fraudulent transfers made and proposed to be made by 

and among members of the Boykin Family and entities they control.” (Doc. 1, p. 1). This matter 

is now before the court on (1) Cello, Boykin Trust, Forest Technologies, Jack Boykin, Lois 

Boykin and Allen Boykin’s (hereinafter referred to as the “Cello Defendants”) motion for 

summary judgment (Doc. 92), Vesta and Elisa Rambo’s (hereinafter referred to as the “Vesta 

Defendants”) amended motion for summary judgment (Doc. 102), P&W’s response to both 

motions (Doc. 108), and Vesta and Elisa Boykin’s reply (Doc. 123); (2) P&W’s motion to strike 

certain expert testimony (Doc. 106) and Vesta and Elisa Rambo’s response (Doc. 124); and (3) 

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P&W’s motion to amend its complaint (Doc. 122) and the Cello Defendants’ response. (Doc. 

133). For the reasons stated below, the defendants’ motions for summary judgment are 

GRANTED in part and DENIED in part, P&W’s motion to amend its complaint is DENIED, and 

P&W’s motion to strike certain expert testimony is, therefore, MOOT. 

FACTS

 Jack Boykin is the chairman of Cello, a company which he formed in 2004 to produce 

synthetic fuels, and is also the owner of an 80% interest in Boykin Trust. (Doc. 109-2, p. 25; 

Doc. 109-3, L. Boykin Dep., p. 5). He is the husband of Lois Boykin and the father of Elisa 

Rambo and Allen Boykin. (Doc. 114-1, L. Boykin Dep., p. 5; Doc. 109-4, J. Boykin Dep., p. 3). 

He earned a bachelor of science degree in chemical engineering at Auburn University and was 

awarded an honorary doctorate from Huntingdon College (Doc. 109-2, pp. 16 & 23), but he is 

not and has never been a licensed professional engineer. (Doc. 109-5, J. Boykin Dep., pp. 4-5). 

Following employment by the United States Navy, Jack worked at Monsanto and Ciba-Geigy 

Corporation and Vertac Corporation, but in the 1970s “went into business for [himself].” (Doc. 

109-2, pp. 23-24). 

 During the course of Jack’s career, Lois has provided loans or advances to Jack or his 

companies in which he was a principal to “keep those companies going.” (Doc. 107-1, p. 15). 

The source of those funds is “saved money from businesses that [Jack and Lois] have owned and 

sold” and “real estate that [Jack and Lois] have sold.” She testified that she did not recall having 

an ownership interest in any company in which Jack was the principal, other than Boykin Trust 

or AEL Industries, LLC (“AEL”), but she stated that once the business was sold, Jack would 

transfer money to both her and him. (Id., p. 16-17). 

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 In 2005 and 2006, the only income Jack received was social security benefits; however, 

that income was outweighed by his business losses. (See Doc. 107-14).1

 During that time, Jack 

had conversations with Caterpillar, Inc. to receive a loan to build a manufacturing plant, but Jack 

never received such a loan. (Doc. 109-2, pp. 17-18). Meanwhile, Allen Boykin reported less 

than $30,000 in income on his 2005 and 2006 income tax returns, but “was in somewhat better 

financial condition” as “there were no judgments against him.” (Docs. 107-15 & 108, p. 5). 

 In February 2007, Jack and Allen, in hopes of having P&W invest in Cello, told P&W’s 

George Landegger and other representatives that they had made commercial quantities of 

biofuels that met ASTM standards from cellulosic materials at their semi-works plant in 

Pritchard, Alabama. (Doc. 109-18, Landegger Dep., pp. 3-5; Doc. 109-2, pp. 3 & 5-7). Based 

on this and other representations, P&W entered into an agreement (the “Option Agreement”) on 

April 19, 2007, to pay Cello $2.5 million for an option to acquire a one-third interest in Cello for 

an additional $10 million upon production by Cello of commercial quantities of diesel fuel, 

kerosene and gasoline that met ASTM standards. (Doc. 109-2, pp. 8-9; 11-12; 26-36). On April 

26, 2007, P&W made a wire transfer of $2.5 million to Cello. (Doc. 114-4). 

 On April 24, 2007, Boykin Trust was formed as a limited liability company under the 

laws of Alabama. At that time, Lois Boykin had an 80% ownership interest in Boykin Trust, 

Elisa Rambo had a 10% ownership interest, and Allen Boykin, who was also the president and 

managing partner, had a 10% ownership interest. (Doc. 109-13, pp. 2-3). Boykin Trust is the 

sole owner of Cello, and the sole asset of Boykin Trust (other than transitory cash balances 

distributed primarily to family members) is its ownership interest in Cello. (See Doc. 114-3, pp. 

 1

 The plaintiff asserts that at this time, there were also “six unpaid judgments against 

[Jack] totaling more than $1.9 million.” (Doc. 108, p. 5). 

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9 & 28). The only business of Boykin Trust was to own Cello. (Doc. 114-1, L. Boykin Dep., p. 

7). The only address listed for Boykin Trust is a Post Office box, and Boykin Trust did not have 

a physical address as Lois Boykin performed work for Boykin Trust from her personal residence. 

(Id., p. 4). Lois Boykin testified that none of the members contributed any capital to Boykin 

Trust at the time it was formed. (Id., p. 12).2

 

 Shortly after receiving the wire transfer from P&W, Cello purchased a 2007 Dodge 2500 

and a 2007 Chevy Impala for a total of $63,000, vehicles which Allen Boykin and Jack Boykin 

drive respectively. (Doc. 114-6, p. 2; Doc. 109-4, J. Boykin Dep., p. 4). Furthermore, Cello 

began paying Boykin Trust $30,000 per month allegedly as an “engineering fee” for Jack 

Boykin’s services. (Doc. 114-1, L. Boykin Dep., pp. 7-8; Doc. 114-3, p. 13). However, Jack did 

not receive this money personally, but rather, Boykin Trust paid Lois Boykin a salary of $20,000 

per month for writing checks and paying all of the bills. (Doc. 114-1, L. Boykin Dep., pp. 7-8; 

Doc. 109-3, L. Boykin Dep., p. 3). The payment of salary to Lois began in May 2007 and 

continued through March 2009. (Doc. 114-1, L. Boykin Dep., pp. 6-7; Doc. 114-3, p. 13). 

 In addition to the payments to Lois, on or around January 2008, Boykin Trust paid Lois 

$30,000, Elisa Rambo $20,000, and Allen Boykin $20,000. (Doc. 115-2, p. 2; Doc. 114-1, L. 

Boykin Dep., pp. 9-10). Initially, those payments were characterized on Boykin Trust’s income 

tax return as loans to partners. (See Doc. 115-3, pp. 5& 8(line 13 is entitled “other assets” and 

lists $76, 780 and in the attached form, $70,000 is described as “due from partners”); Doc. 115-

4, p. 2). At some point thereafter, these payments were reclassified as distributions to the 

members. (See Doc. 114-5, pp. 4-5). A document entitled “Special Meeting of the Members of 

 2

 On December 15, 2008, Lois transferred her 80% interest in Boykin Trust to Jack. 

(Doc. 109-2, p. 20; Doc. 114-5, Hartmann Dep., p. 3). 

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Boykin Trust, L.L.C” and signed by Lois Boykin, Allen Boykin, and Elisa Rambo states that “[a] 

special meeting of Boykin Trust, L.L.C. was held on Saturday, December 15, 2007,” where they 

agreed to distribute 42.86% of the profit to Lois, 28.57% to Allen, and 28.57% to Elisa in the 

same monetary amounts listed above. (Doc. 114-7, p. 20).3

 Similar payments occurred on or 

around December 2008, when Boykin Trust paid Lois $20,000, Elisa $20,000, and Allen 

$20,000. (Doc. 115-5, p. 2; Doc. 114-1, L. Boykin Dep., pp. 9-10). The defendants have not 

provided any documents purporting a special meeting of the members of Boykin Trust 

authorizing the 2008 distributions. (See Doc. 114-2, Hartmann Dep., p. 16). 

 Besides paying Boykin Trust $30,000 per month, Cello also began paying Allen Boykin a 

salary of $15,000 per month within a week of receiving P&W’s option payment.4 (Doc. 115-6, 

p. 2). Allen Boykin testified that he is the “low man on the totem pole” and that his job duties 

for Cello initially consisted of finding a site for the construction of a plant, “arranging land 

clearing, talking to local politicians, electrical folks, ADEM, Volkert on different permitting” 

and generally “everything in basic standard construction”. Allen testified that in 2008, his duties 

for Cello had been “[h]undred percent... constructing the plant” which specifically involves 

“putting up buildings, bringing in equipment, unloading equipment, doing dirt work. You know, 

basic, standard construction process.” (Doc. 109-10, A. Boykin Dep., p. 9). Cello also paid 

Allen a $27,000 bonus in November 2007 and an $18,000 bonus in December 2008. (Doc. 115-

 3

 P&W points out that “[o]n April 26, 2010, after [P&W’s expert Dave] Borden had 

noted that the distributions were not consistent with the members’ respective ownership 

interests... Boykin Trust produced for the first time as an exhibit” this document. (Doc. 108, pp. 

7-8). This court also points out that although this document is signed, it does not have a date 

next to any of the signatures and it was not signed under penalty of perjury. 

4

 Allen received $30,000 on May 31, 2007, and then $15,000 per month thereafter. (Doc. 

115-6, p. 2). 

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6). Allen continues to be paid a salary of $15,000 a month from Cello. (Doc. 109-6, J. Boykin, 

pp. 12-13). Prior to working for Cello, Allen served as an assistant construction supervisor for 

the construction of a plant by his family and others for eight months in Mississippi in 1988. He 

then worked for his father Jack Boykin and also had his own “little water treatment company on 

the side” which ceased operating after approximately a year. In 1994 through 1999, Allen 

managed and owned part of a nursery in Montgomery. From 2004 through 2006, he was the 

“operating or general member” at Forest Technologies and the semi-works plant. (See Doc. 

109-10, A. Boykin Dep., pp. 3-7). 

 In October 2007, Cello wrote two checks for a total of $370,000 ($250,000 on October 

17, 2007, and $120,000 on October 30, 2007), but the names of the payees were redacted. (Doc. 

114-9). On or around those same dates, Brackin, McGriff, and Johnson, P.C. (“BM&J”) 

reported that it received $250,000 and $120,000 in separate transactions from Cello and placed it 

into a trust account titled “Boykin, Jack.” (Doc. 115-8, p. 2). On its financial statement, Cello 

noted that it paid a legal retainer of $370,000 which was “being held to negotiate and purchase 

integral equipment for the plant...” however the identity of the law firm was not identified. 

(Doc. 114-10, p. 11). In January 2008, BM&J wrote a check for $250,000 to Regions bank, who 

merged with AmSouth Bank in 2005, with the description “Environ, LLC.” (Doc. 115-7, p. 2). 

Jack Boykin testified that Environ, LLC (“Environ”) “was established to do... semi-works” at a 

semi-works plant. He testified that in 2004, Hurricane Ivan destroyed the semi-works plant and 

the equipment located in the plant. (Doc. 109-11, J. Boykin Dep., pp. 3-4; Doc. 109-2, p. 19). 

On November 15, 2005, AmSouth Bank, who provided a loan in relation to the semi-works 

plant, obtained a judgment against Jack and Environ for $446,000. That judgment was later 

settled by BM&J on behalf of Jack Boykin, and the equipment, which was being held by Regions 

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as collateral, was thereafter “purchased” and “used in the plant.” (Doc. 109-2, p. 21). Besides 

paying money to Regions Bank, BM&J also transferred $10,000 on March 24, 2008, from the 

Jack Boykin Trust Account to Wade B. Perry, Jr. who wrote a letter acknowledging receipt of 

the money in relation to First American Title v. Jack Boykin, Civil Action No. CV-06-116. He 

thereafter executed a cancellation of the judgment against Jack. (Doc. 109-14, p. 2; Doc. 115-8, 

p. 2). Furthermore, in 2009, BM&J transferred $25,000 out of its Jack Boykin trust account as 

“fees for Allen Boykin Divorce.” (Doc. 115-8, p. 3). 

 P&W asserts that “[t]he Option Agreement prohibited Cello from providing an equity 

interest or licensing the technology to any investor without first obtaining P&W’s permission.” 

(Doc. 108, p. 9). However, in September 2007, Allen Boykin, on behalf of Forest Energy 

Systems, LLC (“FES”) and BioFuels Operating Company, executed a document entitled 

“Manufacturing and Financing Contract” (“MFC”). (Doc. 109-19, pp. 2 & 19). In the MFC, 

Biofuels agreed to pay FES a $25 million project fee for the construction of three plants, with a 

first installment of $12.5 million on the effective date of the contract. (Id., p. 5). Biofuels also 

received (1) the exclusive right to operate and manage those plants and any other plants 

constructed to make use of the technology, (2) 49% of an interim gross profit from each plant for 

up to 80 years, and (3) the exclusive right to provide financing for any plant. (Id., pp. 6-7). On 

September 14, 2007, BioFuels paid Cello $12.5 million via wire transfer.5

 (Doc. 130, J. Boykin 

Dep., p. 3). Following receipt of the project development fee from BioFuels, Jack Boykin placed 

the remainder of the P&W option payment into a separate bank account because “we wanted to 

 5

 P&W cited Tab AT as “Wire Transfer of Funds Statement from BioFuels Operating 

Company (Cello 17514)” but upon review of the record, Tab AT contains an affidavit of Jason 

Westbrook. (See Doc. 109-20). 

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not use the [P&W] funds after we received this payment for the construction of the plant, and so 

we isolated them and kept them separate as best we could.” (Id.). 

 On October 16, 2007, P&W brought a lawsuit against Cello, Boykin Trust, Jack Boykin, 

Allen Boykin, and BioFuels and its related companies for injunctive and declaratory relief. 

(hereinafter referred to as the “Previous Litigation”). (Case No. 07-0743-CG-B, Doc. 1).6

 Also 

in October 2007, Jack spoke with Elisa Rambo, his daughter, about equipping an analytical lab 

for the Cello plan so that fuel produced at the plant could be analyzed to determined whether it 

met ASTM standards. (Doc. 109-8, E. Rambo Dep., p. 10). Jack offered to pay his daughter a 

fee that was less than others would charge because Jack “felt like that would be a proper fee for 

her to be paid” since “other labs would have had travel expenses and living time expenses here” 

and she would not. Elisa accepted this fee without negotiation. (Doc. 109-6, J. Boykin Dep, p. 

11). 

 Elisa has a Ph.D in chemistry from Indiana University, and after receiving her Ph.D, Elisa 

conducted postdoctoral research in France for the French Government in the field of organic 

chemistry and botany. (Doc. 98-1, E. Rambo Dep., pp. 6-7). Following her postdoctoral 

research in France, she performed research for Science International, a company owned by her 

father, and worked for Forest Technologies, a company owned by her and other family members. 

(Doc. 109-8, E. Rambo Dep., pp. 3-6). Since 2003 or 2004, Elisa has been a full-time chemistry 

teacher at the Alabama School of Math and Sciences. (Id., p. 9). Joe Rambo also has a graduate 

degree and PhD in chemistry and also serves as Dean of Students, as well as a chemistry 

instructor, at the Alabama School of Math and Sciences. (Doc. 98-2, pp. 23-24). 

 6

 The complaint was amended on July 31, 2008. (Doc. 158). 

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 Elisa organized Vesta on November 7, 2007, for the purpose of “chemical consulting, 

formulation, repackaging, and sales.” (Doc. 109-15, p. 2; Doc. 98-1). Elisa was a 51% owner of 

Vesta and her husband, Joe Rambo, owned the other 49%. (Doc. 109-16, p. 3; Doc. 98-1). Elisa 

testified that she and her husband had discussed starting a business, and when the “opportunity” 

to consult for Cello “came up”, they “used that as an opportunity to springboard our business.” 

(Doc. 98-2, E. Rambo Dep., p. 3). Elisa and her husband drafted a “consulting contract” and 

provided it to Jack. (Doc. 109-8, E. Rambo Dep., p. 11 & 13; Doc. 98-4). The consulting 

contract, which was executed on December 28, 2007, provided that Vesta would perform the 

following work for Cello: 

-develop all analytical procedures necessary to analyze raw materials, fuel 

product(s) in accordance with ASTM specified analytical procedures and waste 

stream(s) generated by [Cello’s] biofuel manufacturing site; 

-purchase on behalf of [Cello] all instrumentation necessary to validate 

specifications of raw materials, fuel product(s) and waste stream(s); 

-prepare manual of analytical procedures for use by on-site technical staff; 

-train technical staff on the use of analytical instruments and procedures; 

-provide oversight of technical staff following start-up of [Cello’s] biofuel 

manufacturing site; 

-provide consultation regarding analytical needs for future business ventures 

established by [Cello]. 

(Doc. 109-8, p. 24). 

The agreement further provided that Venture would be paid at the rate of $10,000 per month and 

“a contract start up fee” of $30,000. (Id.). Cello paid Vesta $60,000 on December 28, 2007, and 

another $30,000 on April 16, 2008. (Doc. 115-10, p. 2-3; Doc. 109-16, p. 3). Cello also paid 

Vesta $10,000 each on August 13, 2008, September 3, 2008, and October 21, 2008. (Doc. 98-5, 

p. 1). In its responses to interrogatories, Vesta maintained that 

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Consulting services were provided to Cello at a rate of $10,000 per month from 

October 2007 through September 2008. Project included but was not limited to: 

Analytical lab design; research and review of appropriate ASTM methods; 

specification and price negotiation of lab furniture; specification and price 

negotiation of all analytical lab equipment; coordination of delivery and 

installation of all lab furniture and equipment; verification of proper installation 

and function of all lab furniture and equipment; participation in and oversight of 

all lab consumables necessary for lab start-up; act as analytical lab staff support 

until lab supervisor hiring (including site visits); and prepare and provide 

chemical hygiene plan analytical lab. 

(Doc. 98-5, p. 2). 

 Construction on the plant began in early 2008. In June 2008, Elisa, on behalf of Vesta, 

received quotes from three cabinet vendors and six equipment vendors. (See Doc. 115-9). Elisa 

ordered cabinets and lab equipment from a total of five vendors.7 (Doc. 115-11). Elisa 

estimated that the cost of the equipment for the lab was between $250,000 to $350,000 though 

she testified she did not “know the exact amount.” (Doc. 109-8, E. Rambo, p. 22). Upon a 

review of the actual purchase orders and Cello’s general ledger as of December 31, 2008, the 

actual cost of the cabinets and equipment appears to be approximately $150,000. (See Doc. 115-

12, p. 2; Doc. 115-11, p. 6). After receiving the equipment, Elisa testified that the equipment 

vendors trained the employees on the lab equipment while she “worked with... the person who 

came from the companies that did the actual training.” (Doc. 109-8, E. Boykin Dep., pp. 16-17). 

Vesta also provided Cello and BioFuels with a lab safety manual entitled “Analytical Chemical 

Hygiene Plan,” that Elisa testified she developed from “experience.”8

 (Id., pp. 18-19 & 26-36). 

 7

 Elisa did not consult with BioFuels with respect to which equipment it wanted at the lab 

(Doc. 109-8, E. Boykin Dep., p. 15), and in fact, when BioFuels later came on-site to the Cello 

plant, it brought its own lab with it. (Doc. 109-631, J. Boykin Dep., p. 9). 

8

 Jason Westbrook, a public accountant, testified that after performing a Google search 

“to determine if the Plan was modeled after other chemical hygiene plans used by unrelated third 

parties” he discovered “a plan employed by a Utah histology lab, titled ‘Chemical Hygiene 

Plan.” (Doc. 109-20, Westbrook Aff., p.3 & 16). The plan provided by Elisa includes many 

(Continued) 

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 Also in 2008, Boykin Trust began to transfer some of the monies it had received from 

Cello to Forest Technologies, L.L.C. Forest Technologies is wholly owned by AEL, which is in 

turn, owned by Lois Boykin, Elisa Rambo, and Allen Boykin, who is also the managing partner. 

(Doc. 109-12, A. Boykin Dep., p. 3; Doc. 109-8, E. Rambo, pp. 7-8). In April 2008, Lois 

Boykin wrote a Boykin Trust check to Forest Technologies for $10,000, followed by a $5,000 

check in June 2008, $5,000 in July 2008, $5,000 in August 2008, and $2,000 in January 2009. 

(Doc. 115-13). Lois Boykin testified that the above transfers were loans to Forest Technologies 

but admitted that there were no notes, no interest rate, no repayment dates, and that none of these 

loans had been repaid by Forest Technologies as of May 19, 2010. (Doc. 114-1, L. Boykin 

Dep., p. 13-14). In 2007 and 2008, AEL Industries reported it had negative income in both 2007 

and 2008. (Docs. 114-12 & 114-13). 

 On July 16, 2008, the Boykin Defendants in the Previous Litigation filed a motion for a 

judgment on the pleadings asking this court to declare the Option Agreement invalid. (Id., Doc. 

146). P&W asserts that on July 24, 2008, Cello had used all of BioFuels’ project development 

fee, thus it began to use “the P&W option proceeds to pay its debts as they became due” and 

“consumed substantially all of the $2.5 million option proceeds and interest earnings by the end 

of October 2008.” (Doc. 114-3, p. 23). In February 2009, this court ruled in the Previous 

Litigation that the Option Agreement was void ab initio. (Case No. 07-0743-CG-B, Doc. 375). 

P&W maintains that “[b]y that time, Cello had spent all of P&W’s option payment, all of the 

project development fee, $500,000 more advanced by Biofuels, and was on its way to exhausting 

 

identical provisions from the Utah Chemical Hygiene Plan with some additions and deletions. 

(See Id., pp. 31- 43). 

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a $950,000 line of credit from Vision Bank.” (Doc. 108, pp. 10-11)(citing Doc. 114-3, pp. 23-

24). 

 P&W summarized the alleged benefits the Boykin family has received “[a]s of today” 

through transfers among the defendants: (1) Allen Boykin has received $695,000 in salary and 

bonuses from Cello, payments from Boykin Trust, and payments from Cello of divorce attorney 

fees;9 (2) Lois Boykin has received $510,000 in salary and distributions from Boykin Trust;10 (3) 

Jack Boykin has received $391,000 in judgment payments;11 (4) Vesta Venture has received 

$120,000 in payments from Cello; (5) Elisa Rambo has received $40,000 in payments from 

Boykin Trust; and (6) Forest Technologies has received $27,000 in payments from Boykin Trust. 

(Id., pp. 14-15). 

 P&W asserts that at the time all of the above transfers occurred, Cello Energy and Boykin 

Trust’s liabilities exceeded its assets. For the year that ended on December 31, 2007, Cello had 

total assets of $14,634,975 and total liabilities of $15,045,215. The liabilities included a line 

item “Deferred revenue” of $12.5 million (Doc. 115-14, p. 6). The “Deferred revenue” line item 

represents the $12.5 million received from BioFuels for the construction of the first plant. Cello 

noted in its records that it “will recognize the $12.5 million as revenue upon substantial 

completion of the plant as agreed upon by both parties which is expected to occur by December 

 9

 $15,000 per month from April 2007 through June 2010, $27,000 Cello bonus in 

November 2007, $18,000 Cello bonus in December 2008, $20,000 payment from Boykin Trust 

on Christmas Day 2007, $20,000 payment from Boykin Trust in December 2008, $25,000 legal 

fees for divorce. 

10 $20,000 per month from May 2007 through March 2009, $30,000 payment on 

Christmas Day 2007, and $20,000 payment in December 2008. 

11 $250,000 for satisfaction of the AmSouth judgment against Environ and Jack, $10,000 

for satisfaction of judgment of First American Title Insurance Company against Jack, and 

$131,000 for satisfaction of a Vision Bank judgment against Science International and Jack. 

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13 

31, 2008.” (Id., p. 9). The liabilities also included a “Purchase Option” line item for P&W’s $2.5 

million payment to Cello. (Id., p. 6). Cello noted on the financial statement that “[t]he option 

could be exercised anytime after the initial payment and before the expiration of 90 days after the 

refinery being engineered and built in Bay Minette, Alabama, is physically competed and has 

passed standard ASTM test for the production of fuel oils, diesel fuel oils, and gasoline.” (Id., p. 

10). 

 On a balance sheet dated September 30, 2008, Cello had total assets of $13,344,127 and 

total liabilities of $15,015,579. The liabilities continued to list the $12.5 million “Deferred 

revenue” line item and the $2.5 “Purchase Option” line item. (Id., p. 14). The “Deferred 

revenue” line item was thereafter removed from the financial statement for December 31, 2008, 

lowering Cello’s liabilities to $3,815,013. (Id., p. 19). On the June 30, 2009, balance sheet, 

Cello reported it had total assets of $13,928,467 and total liabilities of $5,142,627. (Id., p. 30). 

On December 31, 2009, Cello reported that it had $13,176,111 in total assets and $7,453,369 in 

total liabilities. (Id., p. 35). 

 In regards to eliminating the $12.5 million “Deferred Revenue” line item, P&W asserts 

that “[a]lthough Cello treated the plant as completed and operational in 2008 in order to obtain 

favorable Go-Zone depreciation,” the plant never did what it was designed to do (i.e., “produce 

commercial quantities of biofuel that met ASTM standards from cellulosic materials) and, even 

if it did, the plant was not completed until March 2009. (Doc. 108, p. 15). Jack Boykin testified 

that “[t]he plant had basically been finished in March” of 2009. (Doc. 109-6, J. Boykin Dep., p. 

3). Cello did not turn the plant over to BioFuels for operation until April 2009, when Jack felt 

that the plant had been “substantially completed.” (Id., p. 3-4 & 14-15), but the plant was 

returned to Cello on May 26, 2009, as BioFuels determined that “the plant was not ready yet to 

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be handed over” as “[i]t was still in... pre-commercialization mode.” (Id., p. 4; Doc. 109-22, S. 

Kaul Dep., pp. 3-4). A University of Georgia analysis of fuel, which was provided by Cello as 

having been produced at the plant in February and March 2009, showed that the fuel had no 

cellulosic content and thus was not made from cellulosic material. (Doc. 109-2, p. 15). P&W 

asserts that “[t]he plant is still incapable of producing commercial quantities of biofuels that meet 

ASTM standards from cellulosic materials.12 (Doc. 108, pp. 15-16). 

 On June 29, 2009, the jury in the Previous Litigation returned a verdict in favor of P&W 

and against Cello, Boykin Trust, Jack Boykin, and Allen Boyken, for a total of $10.4 million. 

First, the jury found from a preponderance of the evidence that P&W proved its breach of the 

nondisclosure agreement against Cello and Boykin Trust and awarded P&W $2,827,123.00. 

Second, the jury found from a preponderance of the evidence that there was a business 

relationship between P&W and the Boykin Defendants and that Biofuels and its related parties 

knew of that business relationship at the time of the alleged interference. Third, the jury found 

from a preponderance of the evidence that P&W proved its fraud claim against Cello, Boykin 

Trust, Jack Boykin and Allen Boykin and awarded P&W $104,437.50, and found by clear and 

convincing evidence that all four defendants consciously or deliberately engaged in oppression, 

fraud, wantonness, or malice with regard to this claim and awarded punitive damages of $7.5 

million. (Doc. 109-1, pp. 2-5). 

 The last jury award was in connection with the payment by P&W of $2.5 million for an 

option to acquire a one-third interest in Cello upon proof that a technology that Jack Boykin 

claimed to have developed for producing biofuels from cellulosic materials actually worked. In 

 12 P&W cites a deposition of Jack Boykin from May 19, 2010. While “Tab AW” does 

include a portion of that deposition, it does not include the pages that it cites to this court. 

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15 

order to induce P&W to pay the $2.5 million, P&W maintained that Jack had told it that he and 

Allen had made biofuels that met ASTM standards in commercial quantities (over one million 

gallons) at the semi-works plant in Pritchard, and that there was no reason why they could not 

do it on a larger scale, and Allen allegedly had confirmed his father’s representations. During 

the course of discovery, P&W asserts that the above four defendants had not made fuel from 

cellulosic materials in commercial quantities at the semi-works plant and the fuel they claimed to 

have made subsequently in a plant constructed by Cello (using a portion of P&W’s option 

payment) was in essence fossil-based diesel fuel that they had purchased. (Doc. 108, p. 2). 

 P&W maintains in the present action that while this fraud was occurring, “Cello and 

Boykin Trust had transferred hundreds of thousands of dollars to Jack’s wife, Lois; Jack’s 

daughter, Elisa; Vesta, an entity in which Elisa was a principal; Forest Technologies, an entity 

owned indirectly by Lois, Elisa, and Allen; creditor of Jack[] and Allen, and attorneys for Jack 

and Allen.” It purports that “[t]his lawsuit is an effort to recover those transfers, to protect 

P&W’s rights to collect its verdict in the Previous Litigation from each of the defendants, and to 

hold others who benefit from the defendants’ fraud responsible.” Thus, “[i]n its complaint, 

P&W alleges that (i) each of the defendants made or received fraudulent transfers; (ii) Boykin 

Trust was established for fraudulent purposes, and served as the alter ego of the defendants, and, 

as a consequence, the organizational veil should be pierced to allow P&W to recover from 

Boykin Trust’s members Lois, Elisa, and Allen; and (iii) Allen has been and continues to be 

unjustly enriched (to the detriment of P&W) by Cello.” (Id.). 

LEGAL ANALYSIS

I. Summary Judgment Standard

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Federal Rule of Civil Procedure 56(c) provides that summary judgment shall be granted 

“if the pleadings, the discovery and disclosure materials on file, and any affidavits show that 

there is no genuine issue as to any material fact and that the movant is entitled to judgment as a 

matter of law.” The trial court=s function is not “to weigh the evidence and determine the truth 

of the matter but to determine whether there is a genuine issue for trial.” Anderson v. Liberty 

Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). “The mere existence of 

some evidence to support the non-moving party is not sufficient for denial of summary 

judgment; there must be ‘sufficient evidence favoring the nonmoving party for a [trier of fact] to 

return a verdict for that party.’” Bailey v. Allgas, Inc., 284 F.3d 1237, 1243 (11th Cir. 2002) 

(quoting Anderson, 477 U.S. at 249). “If the evidence is merely colorable, or is not significantly 

probative, summary judgment may be granted.” Anderson, 477 U.S. at 249-250. (internal 

citations omitted). 

The basic issue before the court on a motion for summary judgment is “whether the 

evidence presents a sufficient disagreement to require submission to a [trier of fact] or whether it 

is so one-sided that one party must prevail as a matter of law.” See Anderson, 477 U.S. at 251-

252. The moving party bears the burden of proving that no genuine issue of material fact exists. 

O'Ferrell v. United States, 253 F.3d 1257, 1265 (11th Cir. 2001). In evaluating the argument of 

the moving party, the court must view all evidence in the light most favorable to the non-moving 

party, and resolve all reasonable doubts about the facts in its favor. Burton v. City of Belle 

Glade, 178 F.3d 1175, 1187 (11th Cir. 1999). “If reasonable minds could differ on the 

inferences arising from undisputed facts, then a court should deny summary judgment.” Miranda 

v. B&B Cash Grocery Store, Inc., 975 F.2d 1518, 1534 (11th Cir. 1992) (citing Mercantile Bank 

& Trust v. Fidelity & Deposit Co., 750 F.2d 838, 841 (11th Cir. 1985)). 

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17 

Once the movant satisfies his initial burden under Rule 56(c), the non-moving party 

“must make a sufficient showing to establish the existence of each essential element to that 

party's case, and on which that party will bear the burden of proof at trial.” Howard v. BP Oil 

Company, 32 F.3d 520, 524 (11th Cir. 1994)(citing Celotex Corp. v. Catrett, 477 U.S. 317, 324 

(1986)). Otherwise stated, the non-movant must “demonstrate that there is indeed a material 

issue of fact that precludes summary judgment.” See Clark v. Coats & Clark, Inc., 929 F.2d 604, 

608 (11th Cir. 1991). The non-moving party “may not rely merely on allegations or denials in 

[the non-moving party=s] pleading; rather, its response .... must B by affidavits or as otherwise 

provided in this rule B set out specific facts showing a genuine issue for trial.” FED. R. CIV. P. 

56(e). “A mere ‘scintilla’ of evidence supporting the [non-moving] party=s position will not 

suffice; there must be enough of a showing that the [trier of fact] could reasonably find for that 

party.” Walker v. Darby, 911 F.2d 1573, 1577 (11th Cir. 1990) (citation omitted). “[T]he 

nonmoving party may avail itself of all facts and justifiable inferences in the record taken as a 

whole.” Tipton v. Bergrohr GMBH-Siegen, 965 F.2d 994, 998 (11th Cir. 1992). “Where the 

record taken as a whole could not lead a rational trier of fact to find for the non-moving party, 

there is no genuine issue for trial.” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 

U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (internal quotation and citation omitted). 

II. Alabama Uniform Fraudulent Transfer Act

 In its complaint, P&W, as a creditor of Cello, Boykin Trust, Jack Boykin, and Allen 

Boykin, seeks to have certain transfers of property set aside pursuant to the AUFTA, Ala. Code 

1975, § 8-9A-1 et seq., on the theory that the properties had been transferred fraudulently. (See

Doc. 1). The AUFTA recognizes two different types of fraudulent transfers: actual fraud and 

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constructive fraud. First, § 8-9A-4(a), Ala. Code 1975 allows a creditor to recover a transfer 

where the creditor proves actual fraud: 

A transfer made by a debtor is fraudulent as to a creditor, whether the creditor’s 

claim arose before or after the transfer was made, if the debtor made the transfer 

with actual intent to hinder, delay, or defraud any creditor of the debtor. 

Ala.Code § 8-9A-4(a). 

Second, §§ 8-9A-4(c) and 8-9A-5(a) allow a creditor to recover a transfer where the creditor 

proves constructive fraud. Section 8-9-4(c), Ala. Code 1975 states: 

A transfer made by a debtor is fraudulent as to a creditor, whether the creditor’s 

claim arose before or after the transfer was made, if the debtor made the transfer 

without receiving a reasonably equivalent value in exchange for the transfer and 

the debtor: 

 (1) Was engaged or was about to engage in a business or a transaction for 

 which the remaining assets of the debtor were unreasonably small in 

 relation to the business or transaction; or 

 (2) Intended to incur, or believed or reasonably should have believed that 

 he or she would incur, debts beyond his or her ability to pay as they 

 became due. 

Section 8-9A-5(a) states: 

A transfer made by a debtor is fraudulent as to a creditor whose claim arose 

before the transfer was made if the debtor made the transfer without receiving a 

reasonably equivalent value in exchange for the transfer and the debtor was 

insolvent at that time or the debtor became insolvent as a result of the transfer. 

Insolvency is defined by the AUFTA as (1) “if the sum of the debtor’s debts are greater than all 

of the debtor’s assets at a fair valuation”; or (2) if “a debtor... is generally not paying his debts as 

they become due”. Id. § 8-9A-2(a) and (b). Under the AUFTA, “[a]ssets... do not include 

property that has been transferred, concealed, or removed with intent to hinder, delay or defraud 

creditors or that have been transferred in a manner making the transfer voidable under this 

chapter.” Id. § 8-9A-2(d). 

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 In general, a “creditor” is defined as “[a] person who has a claim” and a “claim” is 

defined as “[a] right of payment, whether or not the right is reduced to judgment, liquidated, 

unliquidated, contingent, unmatured, disputed, undisputed, legal, equitable, secured or 

unsecured...” Id. § 8-9A-1(3) & (4). A “debtor” is defined as “[a] person who is liable on a 

claim.” Id., § 8-9A-1(6). An “insider” includes, which is not a limiting term, the following: (1) 

if the debtor is an individual, (a) a relative of the debtor or of a general partner of the debtor; (b) 

a partnership in the which the debtor is a general partner; (c) a general partner in a partnership in 

which the debtor is a general partner; or a corporation of which the debtor is a director, officer, 

or person in control; and (2) if the debtor is a corporation, (a) a director of the debtor; (b) an 

officer of the debtor; (3) a person in control of the debtor; (4) a partnership in which the debtor is 

a general partner; (5) a general partner in a partnership in which the debtor is a general partner; 

or (6) a relative of a general partner, director, officer, or person in control of the debtor. Id. § 8-

9A-1(8). 

A. Constructive Fraud under Alabama Code § § 8-9A-5 and 8-9A-4(c) 

1. Cello-to-Boykin Trust Transfers

 As stated above, shortly after receiving the wire transfer of $2.5 million from P&W, 

Cello began paying Boykin Trust $30,000 per month allegedly as an “engineering fee” for Jack 

Boykin’s services. (Doc. 114-1, L. Boykin Dep., pp. 7-8; Doc. 114-3, p. 13). During the period 

between April 2007 and December 31, 2009, Cello paid Boykin Trust approximately $690,000 

for Jack’s alleged services. Counts I and III of P&W’s complaint seek to avoid these transfers 

pursuant to § 8-9A-5 and § 8-9A-4(c) respectively and award a judgment in favor of P&W in the 

amount of the Cello-to-Boykin Trust transfers plus interest. (Doc. 1, pp. 11-14). 

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20 

 The Cello defendants ask this court to grant summary judgment as to these counts 

because “[t]he undisputed evidence before this Court is that Cello did, in fact, receive reasonably 

equivalent value in exchange for the Cello to Boykin Trust transfers.” (Doc. 93, pp. 7-8). In 

order to establish claims pursuant § 8-9A-5 and § 8-9A4(c), the plaintiff must show, in part, that 

Cello did not receive “reasonably equivalent value” in exchange for the $30,000 per month 

transferred to Boykin Trust. Thus, the question presented here is whether there is no genuine 

issue as to (1) whether Jack Boykin provided a “value” to Cello; and (2) whether that value was 

“reasonably equivalent” to the $30,000 per month paid by Cello to Boykin Trust. 

 The Cello Defendants base their argument on the report of their expert, Xavier Hartmann. 

In his report, Mr. Hartmann provided: 

On September 1, 2007, Cello and Boykin Trust entered into a Services 

Agreement. The Agreement called for a monthly fixed fee of $30,000 to be paid 

to Boykin Trust for engineering services provided to Cello by Jack Boykin. 

During the period April 2007 through December 31, 2009, consulting fees in the 

amount of $690,000 were paid by Cello to Boykin Trust. Boykin Trust’s equity 

and income were derived from the consulting fees earned in connection with its 

Services Agreement with Cello... Jack Boykin developed the technology and was 

an integral contributor during construction, equipping and implementation of the 

Bay Minette plant. It was his vision and expertise that created the technology 

used in the manufacturing process. It is my opinion the compensation received by 

Boykin Trust for the services provided to Cello by Jack Boykin was not 

unreasonable given the level of services, knowledge, experience, and expertise 

provided. 

(Doc. 94-1, p. 4) 

On the other hand, P&W relies upon its expert David Borden who questioned in his report 

“whether Jack Boykin provided any value (or was capable of providing any value) for the 

alleged services rendered... [because] [t]he jury found him guilty of misrepresentation of these 

and other facts in the verdict reached on June 29, 2009.” (Doc. 107-3, p. 13). In other words, “if 

Jack Boykin fraudulently misrepresented what he had done in terms of manufacturing diesel 

containing... a cellulosic base and in commercial quantities meeting ASTM specs at the Prichard 

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21 

facility, then it’s questionable to me whether he provided any value, because the fundamental 

representation he had done this before.” (Doc. 95-1, Borden Dep., p. 4). While Mr. Hartmann’s 

analysis may be persuasive to the trier of fact and ultimately victorious at trial, this court finds 

that a trier of fact could reasonably conclude that Jack Boykin provided no value to Cello since 

he had fraudulently misrepresented that he had manufactured the technology and in commercial 

quantities. As there is a genuine dispute as to whether Jack Boykin gave “value” to Cello, 

summary judgment as to Counts I and III are due to be denied. 

2. Cello-to-Vesta Transfers 

 As stated above, Elisa Rambo, on behalf of Vesta, entered into an agreement with Cello 

which provided that Vesta would be paid at the rate of $10,000 per month and “a contract start 

up fee” of $30,000 in return for Elisa and her husband’s consulting services. (Doc. 109-8, p. 24). 

Cello ultimately paid Vesta $60,000 on December 28, 2007, another $30,000 on April 16, 2008, 

(Doc. 115-10, p. 2-3; Doc. 109-16, p. 3), and $10,000 on August 13, 2008, September 3, 2008, 

and October 21, 2008. (Doc. 98-5, p. 1). Counts IV and VI of P&W’s complaint seek to avoid 

these transfers pursuant to § 8-9A-5 and § 8-9A-4(c) respectively and award a judgment in favor 

of P&W in the amount of the Cello-to-Vesta transfers plus interest. (Doc. 1, pp. 14-16). 

 The Cello Defendants and the Vesta Defendants ask this court to grant summary 

judgment because “the undisputed evidence before this Court is that Cello did receive reasonably 

equivalent value for the services provided by Vesta...” (Doc. 93, p. 10; see also Doc. 98, p. 11-

13). It is undisputed that Vesta provided a “value” to Cello. P&W, however, asserts that there is 

a genuine dispute as to whether that “value” was “reasonably equivalent” to the $120,000 

transferred by Cello. (Doc. 108, pp. 23-26). This court agrees and finds that a trier of fact could 

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22 

reasonably conclude that the value provided by Vesta was not reasonably equivalent to the 

$120,000 transfer. 

 As stated above, Vesta entered into a consulting contract with Cello that stated Vesta 

would perform certain tasks for Cello.13 While it is undisputed that Vesta performed some of the 

tasks, this court finds that the evidence presents a sufficient disagreement over whether the tasks 

performed were “reasonably equivalent” to the $120,000 transfer. For example, while Elisa 

Rambo measured the laboratory and placed orders for cabinets and equipment, she did not 

consult with any representative of BioFuels about what equipment the lab should include. In 

fact, BioFuels ultimately brought its own lab to the Cello plant. Furthermore, despite the fact she 

testified that she “worked with... the person who came from the companies that did the actual 

training” on the lab equipment (Doc. 109-8, E. Boykin Dep., pp. 16-17), it is undisputed that she 

did not personally train any technical staff on the lab equipment. Lastly, there is a genuine 

question as to whether Elisa developed the “Analytical Laboratory Chemical Hygiene Plan” plan 

from her own experience or whether she copied it from a plan employed by a Utah histology lab 

 13 -develop all analytical procedures necessary to analyze raw materials, fuel product(s) 

 in accordance with ASTM specified analytical procedures and waste stream(s) generated 

 by [Cello’s] biofuel manufacturing site; 

-purchase on behalf of [Cello] all instrumentation necessary to validate specifications of 

 raw materials, fuel product(s) and waste stream(s); 

-prepare manual of analytical procedures for use by on-site technical staff; 

-train technical staff on the use of analytical instruments and procedures; 

-provide oversight of technical staff following start-up of [Cello’s] biofuel manufacturing 

 site; 

-provide consultation regarding analytical needs for future business ventures established 

 by [Cello]. 

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23 

entitled Chemical Hygiene Plan. Viewing the evidence in a light most favorable to P&W, this 

court finds that there are sufficient discrepancies over Vesta’s services that require submission to 

a fact finder, thus summary judgment as to Counts IV and VI is due to be denied. 

 Vesta alternatively asks this court to grant its motion for summary judgment as to P&W’s 

claim against her under § 8-9A-4(c) because it is barred by a one year statute of limitations as 

stated in Alabama Code § 8-9A-9(4) and also to grant the motion as to P&W’s claim under § 8-

9A-5 because P&W’s claim did not arise prior to the Boykin Trust-to-Elisa Rambo transfer. 

(Doc. 98, p. 14-16). Under the AUFTA, an action under § § 8-9A-4(c) and 8-9A-5(a), must be 

brought “within four years after the transfer was made when the action is brought by a creditor 

whose claim arose before the transfer was made.” Ala.Code § 8-9A-9(3)(emphasis added). 

Alternatively, an action under § 8-9A-4(c) must be brought “within one year after the transfer 

was made when the action is brought by a creditor whose claim arose after the transfer was 

made.” Id., § 8-9A-9(4)(emphasis added). Furthermore, an action under § 8-9A-5(a) can not be 

brought if the creditor’s claim arose after the transfer was made. See Ala. Code § 8-9A-5(a). 

 The AUFTA defines “creditor” as “[a] person who has a claim.” Ala. Code § 8-9A-1(4). 

A “claim,” in turn, is defined as “[a] right to payment, whether or not the right is reduced to 

judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, 

legal, equitable, secured, or unsecured...” Id., § 8-9A-1(3). The Alabama Supreme Court has 

stated that “[t]he debtor-creditor relationship is created not by a judgment, but by the wrong 

which produces the injury; and it is the date of the wrongful act, not the date of the filing of the 

suit or of the judgment, which fixes the status and rights of the parties... Hence, a tort claimant 

is a creditor, and the alleged tortfeasor is the debtor.” Cox v. Hughes, 781 So.2d 197, 201 (Ala. 

2000)(quoting Roddam v. Martin, 235 So.2d 654, 656 (Ala. 1970)). In the instant case, the 

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24 

creditor-debtor relationship between P&W and Cello arose not on the date the jury returned a 

verdict in favor of P&W or when P&W filed the instant action, but rather the relationship arose 

at the moment that P&W was fraudulently induced to enter into the Option Agreement and pay 

the $2.5 million in April 2007. As stated above, the transfers from Cello to Vesta were made on 

December 28, 2007, April 16, 2008, August 13, 2008, September 3, 2008, and October 21, 2008. 

Since all the above transfers occurred after April 2007, P&W’s claims under § § 8-9A-4(c) 

and 8-9A-5(a) is not barred under the AUFTA. 

3. Cello-to-Jack Boykin Transfer

 As stated above in the findings of fact, Cello wrote two checks in October 2007 for a total 

of $370,000 to BM&J, who then used $250,000 of these funds to settle a judgment in favor of 

AmSouth Bank (now Regions Bank) against Environ and Jack Boykin and who used $20,000 to 

satisfy a judgment in favor of First American Title Insurance Company against Jack. Counts VII 

and IX of P&W’s complaint seek to avoid these transfers pursuant to § 8-9A-5 and § 8-9A-4(c) 

respectively and award a judgment in favor of P&W in the amount of the Cello-to-Jack Boykin 

transfers plus interest. (Doc. 1, pp. 17-19). 

 The Cello Defendants ask this court to grant summary judgment because “[i]t cannot be 

said the funds distributed in an effort to pay a judgment which has been previously been entered 

against the Defendant is not ‘reasonably equivalent value in exchange.’” In other words, “[t]he 

Baldwin County Circuit Court entered judgment against Environ, LLC and Jack Boykin” thus 

“the value of that exchange was calculated by that Court and determined to be reasonable.” 

Therefore, “[t]he Plaintiff cannot show that the payment of the judgment to a creditor, who had 

already reduced their judgment, is without reasonably equivalent value.” (Doc. 93, p. 12). 

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 The Cello Defendants, however, are mistaken as to law. The question presented here is 

not whether the settlement between Jack Boykin and his two creditors was reasonable, but rather 

whether Cello, as the debtor, received “value” in exchange for the $260,000 it paid to BM&J to 

settle the claims against Jack Boykin and Environ. Since the Cello Defendants have not 

presented any evidence or arguments establishing what “value” Cello received from Jack 

Boykin, Environ, and/or BM&J in exchange for the $260,000 transfer, summary judgment as to 

these claims is due to be denied. 

4. Cello/Boykin Trust-to-Forest Technologies Transfers

 As stated above, Boykin Trust transferred some of the monies it had received from Cello 

to Forest Technologies, which is wholly owned by AEL which in turn is owned by Lois Boykin, 

Elisa Rambo, and Allen Boykin. (Doc. 109-12, A. Boykin Dep., p. 3; Doc. 109-8, E. Rambo, pp. 

7-8). Specifically, in April 2008, Lois Boykin wrote a Boykin Trust check to Forest 

Technologies for $10,000, followed by a $5,000 check in June 2008, $5,000 in July 2008, $5,000 

in August 2008, and $2,000 in January 2009. (Doc. 115-13). Counts X and XII of P&W’s 

complaint seek to avoid these transfers pursuant to § 8-9A-5 and § 8-9A-4(c) respectively and 

award a judgment in favor of P&W in the amount of the above transfers plus interest. P&W’s 

complaint, however, identifies Cello, rather than Boykin Trust, as the party who transferred the 

monies to Forest Technology. (Doc. 1, pp. 20 & 22). The Cello Defendants ask this court to 

dismiss the above counts because of this error. (Doc. 93, p. 12). The plaintiff has filed a motion 

to amend its complaint attempting to correct this error. (Doc. 122, p. 1). 

 District courts are required to “enter a scheduling order that limits the time... to amend 

the pleadings...” Fed.R.Civ.P. 16(b). Such orders “control the subsequent course of the action 

unless modified by a subsequent order,” Fed.R.Civ.P. 16(e), and may be modified only “upon a 

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showing of good cause.” Fed.R.Civ.P. 16(b). Had the plaintiff sought leave to amend its 

complaint before the scheduling order deadline, the court would look to Rule 15(a) of the Federal 

Rules of Civil Procedure to determine whether the amendment should be allowed. While leave 

to amend under Rule 15(a) may be freely given, leave to amend after a scheduling order deadline 

will only be given upon a showing of “good cause” under Rule 16(b). Sosa v. Airprint Sys., Inc., 

133 F.3d 1417, 1418 (11th Cir. 1998). “Otherwise, scheduling order deadlines would be 

‘meaningless’ and the good cause requirement articulated by Rule 16(b) would effectively be 

read out of the Federal Rules of Civil Procedure.” Anderson v. Board of School Comm’rs of 

Mobile County, Ala., 78 F.Supp.2d 1266, 1269 (S.D.Ala. 1999). This “good cause standard... 

precludes modification of a scheduling order deadline unless [the schedule] cannot ‘be met 

despite the diligence of the party seeking the extension.’” Id.(citations omitted). 

 This court entered a scheduling order pursuant to Federal Rule of Civil Procedure on 

November 30, 2009. In that order, this court set a deadline of January 29, 2010, for any party to 

file a motion for leave to amend any pleadings. (Doc. 20, p. 2). The plaintiff filed a motion to 

amend its complaint on July 6, 2010, pursuant to Rule 15 of the Federal Rules of Civil 

Procedure. The plaintiff failed to make any argument concerning “good cause” under Rule 16. 

(Doc. 122). Since it is the plaintiff’s burden and it failed to make any argument as to “good 

cause,” this motion is due to be denied. Regardless, the plaintiff would not be able to establish 

“good cause” since the plaintiff admits that it had identified the proper nature of the transfers on 

March 26, 2010, and the plaintiff failed to provide any reason why it failed to file its motion until 

three months after this date. 14 (Id., p. 3). Furthermore, it is likely that the plaintiff knew the 

 14 Dave Boren submitted a report wherein he “properly identified that P&W’s claims 

relates to transfers made by Boykin Trust.” 

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27 

proper identification of the parties well before that date. In light of the foregoing, this court finds 

that the plaintiff’s motion for leave to amend its complaint is due to be denied. 

 As a result, the plaintiff’s complaint identifies Cello as the company that transferred the 

above monies to Forest Technologies. (See Doc. 1, p. 8, ¶ 45). It is undisputed that Cello did 

not transfer the above monies, but rather Boykin Trust was the company that transferred 

approximately $25,000 to Forest Technologies. As a result, Cello is entitled to summary 

judgment as to Counts X and XII of P&W’s complaint. Furthermore, since Count XI also states 

that Cello is the party that transferred the above monies to Forest Technologies, Cello is entitled 

to summary judgment as to that count as well. 

5. The Boykin Trust Transfers to Lois Boykin, Elisa Rambo, and Allen Boykin

 As discussed above, Cello made monthly transfers of $30,000 to Boykin Trust beginning 

on May 3, 2007. Boykin Trust in turn transferred part of this money to Lois Boykin, Elisa 

Rambo, and Allen Boykin. Specifically, Boykin Trust paid Lois Boykin a salary of $20,000 per 

month for writing checks and paying all of the bills. (Doc. 114-1, L. Boykin Dep., pp. 7-8; Doc. 

109-3, L. Boykin Dep., p. 3). The payment of salary to Lois began in May 2007 and continued 

through March 2009. (Doc. 114-1, L. Boykin Dep., pp. 6-7; Doc. 114-3, p. 13). In addition to 

the payments to Lois, on or around January 2008, Boykin Trust paid Lois $30,000, Elisa Rambo 

$20,000, and Allen Boykin $20,000. (Doc. 115-2, p. 2; Doc. 114-1, L. Boykin Dep., pp. 9-10). 

Similar payments occurred on or around December 2008, when Boykin Trust paid Lois $20,000, 

Elisa $20,000, and Allen $20,000. (Doc. 115-5, p. 2; Doc. 114-1, L. Boykin Dep., pp. 9-10). 

Counts XIII and XV of P&W’s complaint seek to avoid these transfers pursuant to § 8-9A-5 and 

§ 8-9A-4(c) respectively and award a judgment in favor of P&W in the amount of the Boykin 

Trust transfers to Lois, Elisa, and Allen, plus interest. (Doc. 1, pp. 23-25). 

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 The Cello Defendants ask this court to grant summary judgment because “[t]he 

undisputed evidence in this case is that the distributions by Boykin Trust to its members, while 

not in line with their respective interest, was consistent with the Articles of Incorporation and 

letter ratified by a special meeting of the members. Thus, these transfers cannot be fraudulent.” 

(Doc. 93, p. 13). This argument addresses the payments from Boykin Trust to its members in 

January 2008 and in December 2008 but does not address the wage payments to Lois. It is clear 

to this court that a genuine dispute exists as to whether Boykin Trust received reasonably 

equivalent value for its payments of $20,000 per month to Lois. Both P&W’s expert and the 

defendants’ expert agree that viewing the facts in a light most favorable to the plaintiff, Lois 

appears to have been paid “substantially in excess of the value of the services provided.” (Doc. 

114-3, p. 20; see Doc. 114-2, pp. 6-7). As a result, summary judgment as to this particular 

transfer is due to be denied. 

 In regards to the transfers from Boykin Trust to its members in January 2008 and 

December 2008, it is undisputed that these payments were “not in line with [the member’s] 

respective interest.” (Doc. 93, p. 13). Alabama law provides that members of a limited liability 

company are to receive distributions as provided by the operating agreement or if the operating 

agreement does not so provide, which in this case it does not, then in proportion to their 

respective interest. See Ala. Code § 10-12-28. The Cello Defendants attempt to mitigate this 

problem by claiming that an amended distribution schedule was “ratified by a special meeting of 

the members.” (Doc. 93, p. 13). As to the December 2008 payments, the defendants have not 

provided any documents purporting a special meeting of the members of Boykin Trust 

authorizing the 2008 distributions (see Doc. 114-2, Hartmann Dep., p. 16), thus summary 

judgment as to those transfers is due to be denied. However, as to the January 2008 payments, 

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the Cello Defendants have provided a document entitled “Special Meeting of the Members of 

Boykin Trust, L.L.C” and signed by Lois Boykin, Allen Boykin, and Elisa Rambo that states “[a] 

special meeting of Boykin Trust, L.L.C. was held on Saturday, December 15, 2007,” where they 

agreed to distribute 42.86% of the profit to Lois, 28.57% to Allen, and 28.57% to Elisa. (Doc. 

114-7, p. 20). This document, however, has a major problem as it does not establish the date it 

was signed by each party and no one has testified as to the authenticity of the document. 

Viewing all the facts in a light most favorable to the plaintiff, this court finds that there is 

sufficient disagreement over this document, thus requiring submission to a trier of fact over 

whether the January 2008 payments were proper transfers. Therefore, summary judgment as to 

those transfers is due to be denied. 

 Elisa Boykin alternatively asks for this court to grant her motion for summary judgment 

as to P&W’s claim against her under § 8-9A-4(c) because it is barred by a one year statute of 

limitations as stated in Alabama Code § 8-9A-9(4) and also to grant motion as to P&W’s claim 

under § 8-9A-5 because P&W’s claim did not arise prior to the Boykin Trust-to-Elisa Rambo 

transfer. (Doc. 98, p. 18). Under the AUFTA, an action under § § 8-9A-4(c) and 8-9A-5(a), 

must be brought “within four years after the transfer was made when the action is brought by a 

creditor whose claim arose before the transfer was made.” Ala.Code § 8-9A-9(3)(emphasis 

added). Alternatively, an action under § 8-9A-4(c) must be brought “within one year after the 

transfer was made when the action is brought by a creditor whose claim arose after the transfer 

was made.” Id., § 8-9A-9(4)(emphasis added). Furthermore, an action under § 8-9A-5(a) can 

not be brought if the creditor’s claim arose after the transfer was made. See Ala. Code § 8-9A5(a). 

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 The AUFTA defines “creditor” as “[a] person who has a claim.” Ala. Code § 8-9A-1(4). 

A “claim,” in turn, is defined as “[a] right to payment, whether or not the right is reduced to 

judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, 

legal, equitable, secured, or unsecured...” Id., § 8-9A-1(3). The Alabama Supreme Court has 

stated that “[t]he debtor-creditor relationship is created not by a judgment, but by the wrong 

which produces the injury; and it is the date of the wrongful act, not the date of the filing of the 

suit or of the judgment, which fixes the status and rights of the parties... Hence, a tort claimant 

is a creditor, and the alleged tortfeasor is the debtor.” Cox v. Hughes, 781 So.2d at 201 (Ala. 

2000)(citation omitted). In the instant case, the creditor-debtor relationship between P&W and 

Boykin Trust arose not on the date the jury returned a verdict in favor of P&W or when P&W 

filed the instant action, but rather the relationship arose at the moment that P&W was 

fraudulently induced to enter into the Option Agreement and pay the $2.5 million in April 2007. 

Since the January 2008 and December 2008 transfers occurred after April 2007, P&W’s claims 

under § § 8-9A-4(c) and 8-9A-5(a) are not barred under the AUFTA. 

6. The Cello-to-Allen Boykin Transfers

 As discussed above, besides paying Boykin Trust $30,000 per month, Cello also began 

paying Allen Boykin a salary of $15,000 per month,15 (Doc. 115-6, p. 2) a payment which he 

continues to receive to this day. (Doc. 109-6, J. Boykin, pp. 12-13). Cello also paid Allen a 

$27,000 bonus in November 2007 and a $18,000 bonus in December 2008. (Doc. 115-6). 

 15 Allen received $30,000 on May 31, 2007, and then $15,000 per month thereafter. 

(Doc. 115-6, p. 2). 

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Lastly, in 2009, BM&J transferred $25,000 out of its Jack Boykin trust account16 “for Allen 

Boykin Divorce.” (Doc. 115-8, p. 3). Counts XVI and XVIII of P&W’s complaint seek to avoid 

these transfers pursuant to § 8-9A-5 and § 8-9A-4(c) respectively and award a judgment in favor 

of P&W in the amount of the Cello-to-Allen Boykin transfers plus interest. (Doc. 1, pp. 26-28). 

 The Cello Defendants ask this court to grant summary judgment because “the undisputed 

evidence before this Court is that Cello received reasonably equivalent value in exchange for the 

services provided by Allen Boykin”. (Doc. 93, pp. 14-15). The Cello Defendants base their 

argument on the fact that Mr. Hartmann opined that the compensation for Allen’s services “is not 

unreasonable given the nature of his work” including the oversight and management of plant 

construction and on the fact that Mr. Borden “could not testify as to whether Allen Boykin’s 

compensation was reasonable or not.” (Id., p. 14). However, the question presented here is not 

just whether the value of Allen’s services was “reasonably equivalent” to the total transfers paid 

by Cello to Allen but also whether Allen provided a “value” through his services to Cello. Like 

his analysis of Jack Boykin’s services, Mr. Borden opined that if Allen had misrepresented his 

knowledge, experience and expertise in constructing a plant that could produce commercially 

viable cellulosic fuel, Allen’s services, like Jack’s services, would have had no value to Cello. 

See (Doc. 107-8, Borden Dep., p. 11)(“Well, the value of Jack Boykin’s services is based upon 

the jury’s finding that he misrepresented, fraudulently, his background and experience in the 

Prichard facility. Same thing with Allen’s.”); Doc. 107-3, p. 18(“It is unclear at this time what 

value was provided by the services of Allen Boykin to Cello. In the Previous Litigation, the jury 

found Cello, Boykin Trust, Jack Boykin, and Allen Boykin guilty of fraud regarding the ability 

 16 As discussed previously, in October 2007, Cello wrote two checks to BM&J for a total 

of $370,000 and BM&J formed the Jack Boykin Trust account, a fund which BM&J used in part 

to settle judgments against Jack Boykin and also to fund Allen’s divorce. 

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to produce fuel containing cellulosic materials, placing substantial doubt on the value of the 

services provided by Allen Boykin.”). Viewing the facts in a light most favorable to the 

plaintiff, this court finds that a trier of fact could reasonably conclude that Allen Boykin 

provided no value to Cello. Therefore, summary judgment as to Counts XVI and XVIII are due 

to be denied. 

B. Actual Fraud under Alabama Code § 8-9A-4(a) 

 Counts II, V, VIII, XIV, and XVII of P&W’s complaint seek to avoid the above transfers 

pursuant to § 8-9A-4(a) and award a judgment in favor of P&W in the amount of each of the 

above transfers plus interest. (Doc. 1). As stated above, section 8-9A-4(a) provides that: 

A transfer made by a debtor is fraudulent as to a creditor, whether the creditor’s 

claim arose before or after the transfer was made, if the debtor made the transfer 

with actual intent to hinder, delay, or defraud any creditor of the debtor. 

Ala.Code § 8-9A-4(a). 

In determining “actual intent,” the AUFTA provides a non-exclusive list of factors or “badges of 

fraud” that a trier of fact may consider: (1) whether the transfer was to an insider; (2) whether the 

debtor retained possession or control of the property transferred after the transfer; (3) whether the 

transfer was disclosed or concealed; (4) whether before the transfer was made, the debtor had 

been sued or threatened with suit; (5) whether the transfer was of substantially all the debtor’s 

assets; (6) whether the debtor absconded; (7) whether the debtor removed or concealed assets; 

(8) whether the value of the consideration received by the debtor was reasonably equivalent to 

the value of the asset transferred; (9) whether the debtor was insolvent or became insolvent 

shortly after the transfer was made; (10) whether the transfer occurred shortly before or after a 

substantial debt was incurred; and (11) whether the debtor transferred the essential assets of the 

business to a lienor who transferred the assets to an insider of the debtor. Id., § 9-9A-4(b). 

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 It is undisputed that the transfers from Cello to Boykin Trust, from Cello to Jack Boykin, 

from Boykin Trust to Lois, Elisa, and Allen, and from Cello to Allen were all transfers to an 

insider (Factor #1) and were made after the debtor had been sued or threatened with suit (Factor 

#4). Furthermore, there is a genuine dispute as to whether those transfers and the transfers from 

Cello to Vesta were concealed (Factor #3), whether the value of the consideration received by 

the debtor was “reasonably equivalent to the value of the asset transferred” (Factor #8), whether 

the debtor was insolvent or became insolvent after the transfer was made (Factor #9), and 

whether the transfer occurred shortly before or after a substantial debt was incurred (Factor #10). 

 The defendants argue that since Mr. Hartmann weighed these factors and opined “that 

Cello’s transfers.... were not made with actual intent to hinder, delay or defraud any creditors of 

Cello or Boykin Trust” and since Mr. Borden did not give a differing opinion, P&W lacks 

evidence to create a genuine issue of material fact. (Doc. 93, pp. 15-16). The defendants, 

however, misunderstand the role of this court in determining a motion for summary judgment. 

In his report, Mr. Hartmann attempts to weigh the above factors and render an opinion as to 

whether those factors show “actual intent”; however, it is not the duty of this court Ato weigh the 

evidence and determine the truth of the matter...” Anderson v. Liberty Lobby, Inc., 477 U.S. at 

249. Rather, the duty of this court is “to determine whether there is a genuine issue for trial.@ 

Anderson v. Liberty Lobby, Inc., 477 U.S. at 249. There is no de facto rule establishing how 

many factors must be met in order to find, or not find, actual fraud. Kipperman v. Onex Corp., 

slip op., 2010 WL 761227, at *4 (N.D.Ga. Mar. 2, 2010) (“[t]here is no magic formulation. One 

badge may be enough; many badges may not be enough.”). In other words, a plaintiff is not 

required to prove every badge of fraud to refute a motion for summary judgment, but rather, the 

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plaintiff must merely make a sufficient showing of genuine dispute of fact. Mize v. Jefferson 

City Bd. of Education, 93 F.3d 739, 742 (11th Cir. 1996). 

 Six “badges of fraud” are either present or at issue in this case. While a single badge of 

fraud may only create a suspicious circumstance and may not constitute the requisite fraud to set 

aside a conveyance, several of them when considered together may afford a basis to infer fraud. 

Viewing the facts in a light most favorable to the plaintiff, this court finds that a trier of fact 

could reasonably conclude that the debtors made the above transfers with actual intent to hinder, 

delay, or defraud P&W. Therefore, summary judgment is due to be denied as to Counts II, V, 

VIII, XIV, and XVII. 

The Vesta Defendants alternatively assert that summary judgment should be granted as to 

the Cello-to-Vesta Venture transfers (Count V) because Vesta took the money in good faith and 

for reasonably equivalent value. (Doc. 98, p. 11). Section 8-9A-8(a) provides that “[a] transfer 

is not voidable under Section 8-9A-4(a) against a person who took in good faith and for a 

reasonably equivalent value...” Ala. Code § 8-9A-8(a). For the same reasons stated supra in 

regards to constructive fraud, this court finds that there is a genuine dispute as to whether Cello 

received reasonably equivalent value from Vesta’s services. In sum, this court found supra that 

viewing all evidence in the light most favorable to P&W and resolving all reasonable doubts 

about the facts in its favor, the evidence presents a sufficient disagreement to require submission 

to a trier of fact. The Court of Appeals for the Eleventh Circuit has instructed that “[i]f 

reasonable minds could differ on the inferences arising from undisputed facts, then a court 

should deny summary judgment.” Miranda, 975 F.2d at 1534(citation omitted). Therefore, 

summary judgment as to Count V is due to be denied. 

III. Unjust Enrichment of Allen Boykin 

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 In Count IXX [sic]17 of its complaint, P&W asserts that “[a]s a result of the fraudulent 

scheme orchestrated in part by Allen Boykin, Allen Boykin has been unjustly enriched at the 

expense of and to the detriment and harm of creditors such as P&W” and asks this court to enter 

an order “awarding judgment in favor of P&W against Allen Boykin in an amount to be 

determined by the trier of fact to compensate P&W for its damages resulting from Allen 

Boykin’s unjust enrichment...” (Doc. 1, p. 29). The Alabama Supreme Court has stated “[t]o 

prevail on a claim of unjust enrichment, the plaintiff must show that the defendant holds money 

which, in equity and good conscience, belongs to the plaintiff or holds money which was 

improperly paid to defendants because of mistake or fraud... The success of a claim for unjust 

enrichment depends on the particular facts and circumstances of each case.” Atlantic National 

Trust, LLC v. McNamee, 984 So.2d 375, 381 (Ala. 2007)(quoting Scrushy v. Tucker, 955 So.2d 

988, 1011-1012 (Ala. 2006)(quotation marks omitted). 

 In their brief, the Cello Defendants argue that there is no evidence of unjust enrichment 

since “[p]ayments made to Allen Boykin were reasonably equivalent value [sic] in exchange for 

the services provided as an employee of Cello” and since “the distributions to Allen Boykin from 

Boykin Trust were not in violation of the Articles of Incorporation of Boykin Trust, and though 

now in proportional to him [sic] membership interest, were ratified by a special meeting of the 

members.” (Doc. 93, p. 18). For the same reasons stated supra in regards to constructive notice, 

this court finds that there is sufficient disagreement requiring submission to a trier of fact over 

whether the distributions paid to Allen were proper transfers and finds that a trier of fact could 

reasonably conclude that Allen Boykin as an employee of Cello provided no value to Cello since 

he allegedly misrepresented his knowledge, experience and expertise in constructing a plant that 

 17 The next numbered count should be XIX. 

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could produce commercially viable cellulosic fuel. Therefore, summary judgment is due to be 

denied as to Count IXX [sic]. 

IV. Piercing the Corporate Veil 

 In Count XX of its complaint, P&W assert that “[d]ue to the conduct of Lois Boykin, 

Allen Boykin and Elisa Rambo, the corporate veil of Boykin Trust is pierced and Lois Boykin, 

Allen Boykin and Elisa Rambo are personally liable for the indebtedness owed to P&W by 

Boykin Trust”, thus P&W asks this court to “enter an order awarding damages in favor of P&W 

against Lois[], Allen[], and Elisa[], jointly and severally, to the extent necessary to satisfy the 

claim of P&W against Boykin Trust and awarding such other or different relief as the Court 

deems proper and just.” (Doc. 1, pp. 30-31). Relying upon the case Ex parte Thorn, 788 So.2d 

140 (Ala. 2000), the Cello Defendants ask this court to grant summary judgment as to this claim 

because “piercing the corporate veil will not support a cause of action.” (Doc. 93, pp. 17-18). 

However, the defendants’ reliance upon this case is misplaced. In Thorn, the Alabama Supreme 

Court did not find that the plaintiff can altogether not proceed on a cause of action for piercing 

the corporate veil, but rather, the court found that a plaintiff is not entitled to a jury determination 

of that claim. Id. at 145. Instead, the Alabama Supreme Court stated that “the trial court must 

dispose of [the piercing-the-corporate-veil doctrine] without a jury” after the “factual questions 

that are purely legal in nature, as well as those common to the legal and equitable issues” are first 

“decided by the jury.” Id. In light of the foregoing, summary judgment as to Count XX is due to 

be denied. 

CONCLUSION 

After due consideration of all matters presented and for the reasons set forth herein, it is 

ORDERED that the Cello Defendants= motion for summary judgment (Doc. 92) and the Vesta 

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Defendants’ amended motion for summary judgment (Doc. 102) are GRANTED as to Counts X, 

XI, and XII and DENIED as to all other counts in the plaintiff’s complaint; that P&W’s motion 

for leave to amend its complaint (Doc. 122) is DENIED; and that P&W’s motion to strike 

certain expert testimony (Doc. 106) is therefore MOOT. 

DONE and ORDERED this 24th day of August, 2010. 

 /s/ Callie V. S. Granade 

 UNITED STATES DISTRICT JUDGE 

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