Zenergy Brands Liquidation Trust Sues TCN Holdings For Alleged Breach of Contract
October 22, 2021, Eastern District of Texas – Plaintiff Jason Rae, in his capacity as Litigation Trustee for the Zenergy Brands Liquidation Trust for the bankruptcy estate of Zenergy Brands, Inc., et al. sues Defendants Donnie Goodwin and TCN Holdings, LLC for “breach of contract”, “fraud”, “damages”, and “unjust enrichment”. Additionally, Plaintiff seeks to recover transfers over $1 million in “fraudulent conveyances” from the Defendants.
The Trustee alleges that Goodwin and TCN made “material misrepresentations” in some of its disclosures to Zenergy’s subsidiary, ZP&G. The complaint further asserts that the Defendants made the disclosures regarding compliance with one of the contracts, its business practices, certain purchases, et al. Specifically, the Trustee argues that Defendants made the disclosures as positive assertions of fact without knowing their truth. The Trustee also contends that Zenergy allegedly received “no consideration in exchange” for the incurrence of certain obligations. Accordingly, the Trustee argues that ZP&G’s incurrence of obligations and Zenergy’s guaranty of these obligations are avoidable as “fraudulent transfers” under Section 548 (a)(1)(B) of the Bankruptcy Code.