Catamount Constructors Inc. v. Lowery et al

UNITED STATES BANKRUPTCY COURT
MIDDLE DISTRICT OF FLORIDA
JACKSONVILLE DIVISION
In re: 	Case No. 3:25-bk-02562 JAB
Mark Albert Lowery, 	Chapter 11
Debtor.
________________________/
Catamount Constructors Inc., 	Adv. No. 3:25-ap-00107-JAB
Plaintiff,
v.
Mark A. Lowery,
JAX Refrigeration, LLC, and
XAJ Holding, Inc.,
Defendants.
_________________________/
FINDINGS OF FACT AND CONCLUSIONS OF LAW
This Adversary Proceeding came before the Court for Trial on June 4, 2026 (the
“Trial”) on Plaintiff, Catamount Constructors Inc.’s (“Catamount”) Complaint (the
“Complaint”) asserting I) Breach of Contract (against JAX Refrigeration, LLC
(“JAX”)) (“Count I”), II) Fraudulent Transfer under Fla. Stat. § 726.105(1) (against
Dated: September 23, 2026
ORDERED.
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all Defendants) (“Count II”), III) Fraudulent Transfer under Fla. Stat. § 726.106(1)
(against all Defendants) (“Count III”), IV) Piercing of the Corporate Veil (against JAX
and Mark A. Lowery (“Lowery”)) (“Count IV”), and V) Exception to Discharge under
11 U.S.C. § 523(a)(2) (against Lowery) (“Count V”).1 Based on the evidence presented
at Trial, relevant pleadings, and other filings in this Proceeding, the Court makes the
following Findings of Fact and Conclusions of Law.2
Findings of Fact
A. JAX Refrigeration, LLC and Catamount’s Contracts
On July 1, 2021, Catamount entered into a construction contract with Marmaxx
Operating Corp., a Virginia Corporation, as the general contractor for a construction
project known as TJX Marshalls Distribution Center in El Paso, Texas (the “Project”),
with a planned completion date of December 1, 2022.3 On July 8, 2020, Catamount
and JAX entered into a master subcontract agreement (the “Master Subcontract”) for
all projects in which Catamount engaged JAX and agreed to execute a work
authorization for each project, detailing the scope of work and other project-specific
information.4 On September 29, 2021, Catamount and JAX entered into a project-
specific work authorization (the “Work Authorization”), incorporating the Master
1 Adv. Doc. 1. Plaintiff and Defendants will be collectively referred to as the “Parties.”
2 See Fed. R. Bankr. P. 7052.
3 Plaintiff’s Ex. 1.
4 Plaintiff’s Ex. 2.
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Subcontract by reference, for JAX to furnish and install complete plumbing for the
Project, for a price of $2,661,527.00.5
The Work Authorization outlined the scope of the Project6 and the project
schedule (the “Schedule”).7 The Schedule required that: 1) the 3-week look ahead
schedule be updated weekly, 2) submittals be provided within seven days of the award,
3) the underground for roof drains be completed within 14 days and noted it is the
sequence ahead of slab pours, 4) the underground for office areas be completed within
27 days, and 5) the overhead plumbing and roof drains be completed within 106 days
and noted it is the sequence ahead of mezzanine erection.8 The Work Authorization
clearly stated, JAX was solely responsible for delivering all submittals per the
specifications in the Schedule as to not delay the Project.9 The Project Subcontract
required JAX to complete its work in a prompt, diligent, and workmanlike manner
and required JAX to complete its scope of work in strict accordance with all plans,
specifications, drawings, and other requirements listed.10
The Master Subcontract required that JAX at all times have a sufficient number
of properly skilled workers, sufficient amount of material and supplies to efficiently
and promptly complete the Project, and it not employ unfit persons who were not
5 Plaintiff’s Ex. 3 at ¶ 2. Together the Work Authorization and Master Subcontract will be
referred to as the “Project Subcontract.”
6 Id.
7 Id. at ¶ 5.
8 Id.
9 Id. at 4 ¶ s.
10 See Plaintiff’s Ex. 2 at ¶ 1; Plaintiff’s Ex. 3 at ¶ 2.
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skilled in the tasks assigned to them.11 The Master Subcontract required JAX to
properly man, equip, coordinate and complete its work efficiently, to maintain the
Schedule, and to avoid and prevent any delay, hindrance to, disruption, or interference
with the progress of other trades or the completion of the Project.12
Prior to and throughout the course of the Project, Catamount conducted
meetings, at which JAX was required to have representatives in attendance.13 JAX
was also required to submit claims in writing to Catamount for additional cost, extra
work, extensions of time, and any other issue within five days of JAX reasonably
knowing of the circumstances giving rise to the need to make a claim.14 JAX was
required 	to 	reimburse 	Catamount 	for 	all 	expenses 	incurred, 	and 	fully 	defend,
indemnify, and hold Catamount harmless from and against: (1) any and all liquidated
or actual delay or disruption damage and (2) any and all other liability resulting in any
manner whatsoever, directly or indirectly, from any and all delays, disruptions, or
interferences caused by JAX.15
If JAX failed to comply with any provision of the Master Subcontract,
Catamount, upon 24 hours’ written notice, had the right to declare JAX in breach and
terminate the Project Subcontract.16 Upon termination, JAX would be liable to
Catamount for the expense to correct, replace, or complete its work, together with any
11 Plaintiff’s Ex. 2 at ¶ 11.
12 Id. at ¶ 5.
13 Id. at ¶ 12.
14 Id. at ¶ 17.
15 Id. at ¶ 18.
16 Id. at ¶ 19a.
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liquidated damages attributable to delays caused by JAX’s performance that exceeded
the unpaid balance of the Work Authorization.17 Catamount had no obligation to
provide 	additional 	notice 	to 	JAX 	beyond 	the 	initial 	24-hour 	written 	notice
requirement.18
B. The Project Timeline
If JAX had started the Schedule on September 29, 2021, the day after the Work
Authorization was signed, the submittals19 should have been submitted by October 5,
2021, the underground for roof drains should have been completed by October 12,
2021, the underground for the office areas should have been completed by October 25,
2021, and the overhead plumbing and roof drains should have been completed by
January 12, 2022.
Around October 7, 2021, JAX mobilized on the Project. Based on that date,
Submittals should have been submitted by October 26, 2021, the underground for roof
drains should have been completed by November 2, 2021, the underground for the
office areas should have been completed by November 15, 2021, and the overhead
plumbing and roof drains should have been completed by February 2, 2022.
On October 21, 2021, JAX failed its first inspection, and the next day failed a
re-inspection.20 On November 18, 2021, JAX, while working on the underground
17 Id. at ¶ 19a.
18 Id. at ¶ 19c.
19 Tr. at 26 (Submittals are product data on materials which a contractor would install, that
are provided from a supplier).
20 Plaintiff’s Ex. 28 at 2.
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plumbing, backfilled a trench without proper compaction, which required it to remove
the material and refill the trench.21 Two days later, JAX had still not refilled the trench
correctly and had only two people onsite working.22 JAX continued to have issues
with the underground plumbing, which resulted in both the concrete and structural
steel contractors threatening to send their crews home due to delays.23
On December 14, 2021, as a result of mistakes and delays, Catamount provided
JAX a formal 24-hour notice (the “Notice”).24 The Notice provided JAX failed to 1)
provide sufficient on-site supervision, 2) provide sufficient manpower, 3) failed six
inspections which caused delays to the Schedule, and 4) provide submittals in a timely
manner.25 Thereafter, Catamount required that JAX submit a plan with corrective
measures within 24 hours.26
Following the Notice, JAX continued to have issues with the underground
plumbing, including a sanitary line that JAX should have started on or before
December 22, 2021, and by January 9, 2022, it was not inspected or backfilled.27 In
March 2022, a concrete slab inspection failed due to JAX’s work, which put the
concrete contractor behind and Catamount warned JAX that back charges from the
concrete contractor were likely to occur because of delays caused by JAX.28
21 Plaintiff’s Ex. 25 at 11-12.
22 Id. at 10.
23 Id. at 6.
24 Plaintiff’s Ex. 27 at 2-3.
25 Id. at 2.
26 Id. at 1.
27 Plaintiff’s Ex. 30 at 2.
28 Plaintiff’s Ex. 38 at 2.
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On March 21, 2022, Catamount rejected JAX’s March pay application (the
“March Application”) for multiple reasons including JAX billed at 100% for office
underground work that had not been started, JAX billed high bay rentals at 91%
although a majority was incomplete, daily reports were not provided, and back charges
needed to be billed for.29 On March 22, 2022, JAX considered the rejection of the
March Application a breach of contract and stated it would demobilize unless
Catamount stopped all back charges and provided $300,000.00 in additional funding.30
On March 25, 2022, Catamount proposed a plan where it would absorb
previous back charges, as long as JAX met or exceeded new Schedule durations, and
if they failed to do so all known back charges and costs incurred would be JAX’s
responsibility.31 Further, Catamount’s proposed plan required JAX to keep Duran
Plumbing 	on 	as 	supervision, 	JAX 	participate 	in 	on-site 	mandatory 	weekly
subcontractor meetings, JAX participate in mandatory weekly site safety meetings,
and JAX revise and resubmit the March Application with line items removed that have
not started.32 On March 31, 2022, JAX rejected Catamount’s proposed plan and
indicated it would continue only if Catamount imposed no past or future back charges,
provide payment of retainage in the amount of $168,728.00, labor, subcontractors, and
materials be billed at actual cost or invoice plus 5%, and all previous pay applications
29 Plaintiff’s Ex. 6 at 2.
30 Id. at 1.
31 Plaintiff’s Ex. 5 at 1-2.
32 Id. at 2.
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up to the March Application be paid in full.33
On April 8, 2022, Catamount rejected JAX’s additional demands and reminded
JAX that the Project Subcontract was enforceable, and legal liabilities would result
from JAX’s failure to complete the scope of the Work Authorization or reach a
resolution.34 The same day, JAX, unsatisfied with the terms of continuing the Project,
notified Catamount that it would demobilize immediately from the Project.35
On April 14, 2022, Catamount sent a second 24-Hour notice (the “Second
Notice”) and termination letter (the “Termination Letter”) to JAX, providing formal
notice that it was terminating the Project Subcontract on April 16, 2022, due to JAX’s
nonperformance and abandonment of the Project.36 Based on the foregoing, and as
discussed in more detail below, the Court finds JAX breached the Project Subcontract.
C. The Real Property Sale
On June 12, 2023, a corporate warranty deed (the “Deed”) was executed by
JAX and XAJ Holdings, Inc. (“XAJ”), on behalf of JAX for the sale (the “Sale”) of
the property located at 901 7 th Avenue, Jacksonville Beach, Florida, 32250 (the
“Property”) to Natural Life Collections, Inc. for $7,000,000.00.37 Lowery, as Director
and Chief Executive Officer, was the sole signatory of the Deed on behalf of both JAX
and XAJ.38 After closing costs and satisfaction of secured obligations, the net sale
33 Plaintiff’s Ex. 7 at 2.
34 Id. at 1.
35 Plaintiff’s Ex. 8 at 1.
36 Plaintiff’s Ex. 10.
37 Plaintiff’s Ex. 51; Defendants’ Ex. 7.
38 Plaintiff’s Ex. 51 at 2; Defendants’ Ex. 7 at 3.
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proceeds were $866,444.32 (the “Property Sale Proceeds”).39 On June 14, 2023, the
Property Sale Proceeds was wired to JAX’s Morgan Stanley Account ending in 5092
(the “JAX MS 5092 Account”).40
D. JAX 2023 Pre Property Sale Wire Transfers41
Catamount called into question the following transfers from the JAX MS 5092
Account 	to 	accounts associated with 	Defendants: LDDV, Inc. (“LDDV”), the
company owned by Samantha Lowery (“Mrs. Lowery”), Lowery’s wife; the Lowery
Revocable Trust (the “Lowery Trust”); and American Express (“AMEX”):42
• 	On January 17, 2023, $150,000.00 was wired (the “January 17 Transfer”)
from the JAX MS 5092 Account to the Lowery Trust Truist account ending
in 0820 (the “Trust Truist Account”).43
• 	On February 6, 2023, $324,301.00, $151,000.00, and $68,000.00 was wired
(the “February 6 Transfers”) from the JAX MS 5092 Account to the 3010
AMEX.44
• 	On February 7, 2023, $100,000.00 was wired (the “February 7 Transfer”)
from the JAX MS 5092 Account to the Trust Truist Account.45
39 Plaintiff’s Ex. 51 at 4-6; Defendants’ Ex. 7 at 5-7.
40 Plaintiff’s Ex. 45 at 22, 99; Defendants’ Ex. 2 at 23, 92.
41 All wire transfers prior to the Sale in this section will collectively be referred to as the “Pre-
Sale Transfers.”
42 Plaintiff’s Ex. 45. For the purpose of these Findings of Fact and Conclusions of Law the
reference to JAX MS 5092 Account is the same as Unterholzner’s reference to a Morgan
Stanley Account ending in 6775. There were additional transfers that were not included in
Unterholzners analysis.
43 Plaintiff’s Ex. 44 at 30; Plaintiff’s Ex. 45 at 100; Defendants’ Ex. 2 at 93.
44 Plaintiff’s Ex. 44 at 30; Plaintiff’s Ex. 45 at 100; Defendants’ Ex. 2 at 93. The evidence
related to the 3010 AMEX, is lacking. The record before this Court does not identify the name
of the owner of the 3010 AMEX and no monthly statements were presented at Trial.
45 Plaintiff’s Ex. 44 at 30; Plaintiff’s Ex. 45 at 100; Defendants’ Ex. 2 at 93.
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• 	On April 6, 2023, an internal transfer (the “April 6 Transfer”) of $800,000.00
from the JAX MS 5092 Account was made to the Lowery Trust Morgan
Stanley account ending in 3092 (the “Trust MS 3092 Account”).46
E. Post Property Sale Transfers47
After the Sale, several transfers were made from the JAX MS 5092 account to
LDDV, AMEX, and JAX HVAC, Inc. (“JAX HVAC”) including:
• 	On June 23, 2023, $187,478.38 was wired (the “June 23 Payment”) from the
JAX MS 5092 Account to the LDDV corporate American Express account
ending in 2008 (the “LDDV AMEX”).48
• 	On June 26, 2023, $55,496.41 was wired from the JAX MS 5092 Account
to Lowery’s personal American Express ending in 2005 (the “Lowery 2005
AMEX”).49
• 	On July 13, 2023, $85,853.52 was wired from the JAX MS 5092 Account to
the Lowery 2005 AMEX.50
• 	On August 25, 2023, $6,000.00 was wired from the JAX HVAC Truist
Account ending in 3290 (the “JAX HVAC 3290 Account”) to the Lowery
2005 AMEX.51
• 	On September 25, 2023, $40,946.67 was wired from the JAX MS 5092
Account to the Lowery 2005 AMEX.52
46 Plaintiff’s Ex. 44 at 30; Plaintiff’s Ex. 45 at 100; Defendants’ Ex. 2 at 93.
47 All wire transfers in this section will collectively be referred to as the “Post-Sale Transfers.”
48 Plaintiff’s Ex. 44 at 34, 78; Plaintiff’s Ex. 45 at 101; Defendants’ Ex. 2 at 94; Defendants’
Ex. 5 at 8; Defendants’ Ex. 8.
49 Plaintiff’s Ex. 44 at 33, 78; Plaintiff’s Ex. 45 at 101; Plaintiff’s Ex. 46 at 17; Defendants’ Ex.
2 at 94; Defendants’ Ex. 3 at 10; Defendants’ Ex. 8.
50 Plaintiff’s Ex. 44 at 33, 72; Plaintiff’s Ex. 45 at 101; Plaintiff’s Ex. 46 at 23; Defendants’
Ex. 2 at 94; Defendants’ Ex. 3 at 16; Defendants’ Ex. 8.
51 Plaintiff’s Ex. 44 at 33, 73; Plaintiff’s Ex. 46 at 29; Defendants’ Ex. 3 at 22. JAX HVAC is
a related subsidiary to JAX and XAJ although is not a party in this Proceeding. The JAX
HVAC 3290 Account statements were not provided as evidence in this Proceeding.
52 Plaintiff’s Ex. 44 at 33, 72; Plaintiff’s Ex. 45 at 44, 101; Plaintiff’s Ex. 46 at 35; Defendants’
Ex. 2 at 94; Defendants’ Ex. 3 at 28; Defendants’ Ex. 8.
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• 	On October 2, 2023, $54,182.62 was wired from the JAX MS 5092 Account
to the LDDV AMEX.53
• 	On October 27, 2023, $25,000.00 was wired from the JAX HVAC 3290
Account to the Lowery 2005 AMEX.54
• 	On November 21, 2023, $77,390.58 was wired from the JAX MS 5092
Account to the Lowery 2005 AMEX.55
• 	On December 13, 2023, $100,000.00 was wired from the JAX MS 5092
Account to the Lowery 2005 AMEX.56
F. The JAX and XAJ Bankruptcy Cases
On October 2, 2025, JAX filed a voluntary Chapter 7 bankruptcy case No. 3:25-
bk-03561-JAB (the “JAX Bankruptcy”).57 JAX scheduled $0.00 in secured claims,
$16,664.59 in priority unsecured claims, and $8,508,841.40 in non-priority unsecured
claims. 58 In JAX’s Schedule A/B, Catamount is listed as a cause of action with the
nature of the claim listed as “claim for construction damages” in an unknown
amount.59 In JAX’s Schedule E/F, Catamount is listed as an unsecured creditor in the
amount 	of 	$2,660,000.00 	that 	is 	not 	disputed, 	contingent, 	or 	unliquidated.60
Catamount did not file a claim in the JAX Bankruptcy. On December 3, 2025, the
53 Plaintiff’s Ex. 44 at 33, 78; Plaintiff’s Ex. 45 at 64, 101; Defendants’ Ex. 2 at 94; Defendants’
Ex. 5 at 34; Defendants’ Ex. 8.
54 Plaintiff’s Ex. 44 at 33, 73; Defendants’ Ex. 3 at 34.
55 Plaintiff’s Ex. 44 at 33, 72; Plaintiff’s Ex. 45 at 80, 101; Defendants’ Ex. 2 at 94; Defendants’
Ex. 3 at 40; Defendants’ Ex. 8.
56 Plaintiff’s Ex. 44 at 33, 72; Plaintiff’s Ex. 45 at 98, 101; Defendants’ Ex. 2 at 94; Defendants’
Ex. 3 at 48; Defendants’ Ex. 8.
57 JAX Bankruptcy, Doc. 1.
58 Id. at 33.
59 Id. at 12.
60 Id. at 23.
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trustee filed a Chapter 7 Trustee’s Report of No Distribution. On January 14, 2026,
the JAX Bankruptcy was closed.
On October 5, 2025, XAJ filed a Chapter 7 bankruptcy case, Case No. 3:25-bk-
03587-JAB (the “XAJ Bankruptcy”).61 XAJ had a total of $0.00 in secured claims,
$16,664.59 in priority unsecured claims, and $8,508,841.40 in non-priority unsecured
claims.62 In Schedule E/F, Catamount is listed as an unsecured creditor in the amount
of $2,660,000.00 that is undisputed, contingent, or unliquidated.63 In the Statement of
Financial Affairs, XAJ listed a pending lawsuit in the United States District Court for
the Middle District of Florida, Case No. 3:24-cv-00265-MMH-PDB (the “District
Court Case”) between Catamount and Debtors, with the nature of the case listed as
“collection.”64 The priority and non-priority unsecured claims in the XAJ Bankruptcy
and JAX Bankruptcy were identical, and there were a number of claims for which the
listed amount was unknown.65 There were no claims filed in the XAJ Bankruptcy. On
December 3, 2025, the trustee filed a Chapter 7 Trustee’s Report of No Distribution.
On January 15, 2026, the XAJ Bankruptcy was closed.
G. The District Court Case
The parties in the District Court Case are Plaintiff, Catamount and Defendants
JAX, Lowery, Mrs. Lowery, and XAJ. On March 14, 2024, the District Court Case
61 XAJ Bankruptcy, Doc. 1.
62 Id. at 37.
63 Id. at 24.
64 Id. at 40.
65 Id.; JAX Bankruptcy, Doc. 1.
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complaint 	was 	filed,66 and 	on 	April 2, 2025 	it 	was 	amended 	(the 	“Amended
Complaint”).67 The Amended Complaint was virtually identical to the district court
complaint with the counts being I) Breach of Contract (against JAX), II) Fraudulent
Transfer under Fla. Stat. § 726.105(1) (against JAX, Lowery, Mrs. Lowery, and XAJ),
III) Fraudulent Transfer under Fla. Stat. § 726.106(1) (against JAX, Lowery, Mrs.
Lowery, and XAJ), and IV) Piercing the Corporate Veil (against JAX and Lowery).
Catamount was provided with the opportunity to return to the District Court to
prosecute this matter earlier in this Proceeding and elected to continue with this
Proceeding instead of the District Court Case.
H. The Lowery Bankruptcy Case
On July 28, 2025, Lowery filed the underlying Chapter 11 bankruptcy case,
Case No. 3:25-bk-02562-JAB (the “Lowery Bankruptcy”) and listed Catamount as an
unsecured 	creditor 	in 	an 	unknown 	amount.68 	Lowery 	scheduled 	a 	total 	of
$7,000,108.00 in secured claims,69 $400,000.00 in priority unsecured claims, and
$893,440.50 in non-priority unsecured claims.70 There were a total of 33 claims filed
totaling $19,273,028.80. Catamount did not file a claim in the Lowery Bankruptcy.
On October 31, 2025, Lowery filed his Chapter 11 Plan of Reorganization (the
66 District Court Case, Doc. 1.
67 District Court Case, Doc. 40.
68 Lowery Bankruptcy, Doc. 1.
69 Id. at 29.
70 Id. at 55.
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“Plan”).71 On January 14, 2026, the Court entered an Order Confirming the Plan.72
On March 3, 2026, the Court entered an Order of Discharge.73
I. 	This Adversary Proceeding
On October 9, 2025, Catamount filed the Complaint.74 On October 20, 2025,
Defendants filed a Motion to Dismiss Adversary Proceeding with Prejudice,75 which
the Court denied on December 19, 2025.76 On February 12, 2026, the Court entered
the Order Scheduling Trial, including deadlines for pre-trial filings, with a deadline for
the disclosure of expert witnesses as 28 days before Trial.77 On March 18, 2026,
Defendants 	timely 	filed 	a 	Disclosure 	of 	Expert 	Witness 	Names 	and 	Contact
Information.78 On April 24, 2026, Catamount filed a Motion for Enlargement of Time,
Continuance of Trial, and Extension of Case Deadlines,79 which was denied by the
Court during the April 28, 2026 hearing, and by an Order on April 29, 2026.80 On
April 30, 2026, Catamount filed a Motion for Leave to File Out of Time Expert
Disclosure (the “Motion for Leave”) for the inclusion of the Expert Report written by
Lisl Unterholzner (“Unterholzner”),81 and on May 11, 2026, the Court entered an
71 Lowery Bankruptcy, Doc. 94.
72 Lowery Bankruptcy, Doc. 178. Under the Plan, the unsecured class was to receive a
$50,000.00 lump sum payment upon the effective date of the Plan.
73 Lowery Bankruptcy, Doc. 184.
74 Adv. Doc. 1.
75 Adv. Doc. 5.
76 Adv. Doc. 16.
77 Adv. Doc. 21.
78 Adv. Doc. 25.
79 Adv. Doc. 28.
80 Adv. Doc. 31.
81 Adv. Doc. 32.
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Order Granting the Motion for Leave, requiring Catamount’s expert disclosure and
expert report to be filed by May 21, 2026.82 On May 18, 2026, Catamount filed its
Amended Rule 26(A)(3) Pretrial Disclosures, including the names and contact
information for expert witnesses.83 On May 21, 2026, Catamount filed its Pre-Trial
Brief84 and Notice of Filing Expert Witness Report for Unterholzner.85 On May 22,
2026, Defendants filed a Motion in Limine Regarding Trial Evidence (the “Motion in
Limine”).86 On May 28, 2026, Defendants filed their Pre-Trial Memorandum,87 and
Catamount filed the Joint Stipulation of Undisputed Facts and Exhibits.88 On May 28,
2026, Catamount filed proposed exhibits 1-25, 27-40, 43-45, 51, and 53-54,89 and on
June 	1, 	2026, 	it 	filed 	additional 	proposed 	exhibits 	46-50 	and 	52 	(“Plaintiff’s
Exhibits”).90 On May 29, 2026, Defendants filed proposed exhibits 1-8 (“Defendants’
Exhibits”).91 On June 3, 2026, Catamount filed a Motion to Amend Pleadings Based
on Trial Objections (the “Motion to Amend”).92
82 Adv. Doc. 41.
83 Adv. Doc. 44.
84 Adv. Doc. 46.
85 Adv. Doc. 47
86 Adv. Doc. 48.
87 Adv. Doc. 49.
88 Adv. Doc. 50. On June 1, 2026, Catamount filed an Amended Joint Stipulation of
Undisputed Facts and Exhibits (Adv. Doc. 55).
89 Adv. Doc. 51.
90 Adv. Doc. 56.
91 Adv. Doc. 53.
92 Adv. Doc. 57.
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a. The Trial
The Trial on all counts of the Complaint took place on June 4, 2026. The Court
admitted 	Plaintiff’s 	Exhibits 	and 	Defendants’ 	Exhibits 	into 	evidence 	without
objection. 93 Notably, the Plaintiff’s and Defendants’ Exhibits do not include the
transcript of any depositions and do not include complete records of all bank and credit
card statements. Catamount and Defendants both called witnesses. 	Catamount
asserted its damages at the time of the Trial are $2,841,177.00.94
i. 	Testimony of Randy Metz
Randy Metz (“Metz”), lead Catamount superintendent on the Project, testified
credibly as to his on-site experiences, communications with JAX, JAX caused delays,
and JAX breaches of its agreements with Catamount. Metz’s testimony included:
• 	When JAX was terminated six months after the date the submittals were
due according to the Schedule, the submittals had not been received. If
submittals are delayed, the scope of work cannot be started.95
• 	The Schedule required JAX to complete the underground plumbing
within 30 days, but JAX did not receive the permit required to complete
the underground plumbing until three weeks after it mobilized. 	When
JAX 	demobilized 	six 	months 	later 	it 	was 	still 	working 	on 	the
underground 	plumbing.96 	At 	the 	time 	JAX 	mobilized 	it 	started
excavations, but no inspections could be completed until a permit was
received;97
• 	He did not believe JAX had an on-site supervisor. He stated that someone
by the name of Reggie, who attended some of the required weekly
subcontractor meetings, stated he was a temporary [JAX employee].
93 Plaintiff’s Exs. 26, 41, and 42 were omitted.
94 Plaintiff’s Ex. 13.
95 Tr. at 67.
96 Id. at 27-28.
97Id. at 56.
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When Metz contacted JAX, he was told that Reggie was the JAX
representative;98
• 	JAX was a front-loaded trade, which meant JAX’s work was required to
be completed before successor trades could complete their work, and
JAX’s failure to perform caused delays;99
• 	JAX had failed to adhere to the Master Subcontract provision for scope
of work at the time Catamount declined to pay JAX March Application
and JAX sought payment for incomplete work;100
• 	The March Application billed at 100% for work that had not been started,
and billed at 91% for work that had been started but was not close to
being completed;101
• 	During contractor meetings a look-ahead schedule is put together to lay
out the scope of work to be completed within a seven day period,
subcontractors make representations about what they will achieve, and
minutes are generated.102 JAX did not attend most of the subcontractor
meetings, including meetings after Metz called about Reggie, who JAX
stated was its representative.103 For a two week period an individual
attended the mandatory weekly meetings on behalf of JAX;104
• 	JAX provided insufficient, unskilled, and unsupervised workers and as a
result fell behind schedule and impacted other contractors;105
• 	JAX did not make any claims to Catamount regarding additional costs,
extra work, extensions of time, or other issues as provided in the Master
Subcontract;106
98 Id. at 28.
99 Id. at 30.
100 Id. at 32. JAX was allowed to bill for actual work in place and for stored materials, but not
for work that had not been started or been completed.
101 Id. at 76.
102 Id. at 34-36.
103 Id. at 35.
104 Id. at 63.
105 Id. at 36-37.
106 Id. at 40.
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• 	Paragraph 18 of the Master Subcontract titled Delays and Disruptions
provides the basis for Catamount’s claim for damages;107
• 	Failing an inspection can result in a four-to-five-day delay;108
• 	JAX failed to properly fill and compress the underground, which led to
lost time in excavating and required restarting the process;109
• 	In January 2022, JAX had not properly completed the underground
portion of the Project;110
• 	In the event someone was required to complete JAX’s work, Catamount
could be compensated for the additional cost;111
• 	The 	Notice 	issued 	December 	14, 	2021, 	identified 	issues 	including
unqualified workers and the use of temporary labor, and required JAX to
submit a cure plan.112 JAX did not refute this Notice;113
• 	JAX failed to satisfy the conditions to resolve the default from the Notice
by March 2022.114 JAX brought in Duran Plumbing to supplement its
crew, but the situation did not improve;115
• 	Catamount did not receive any delay reimbursements from the owner of
the Project related to JAX’s work;116
• 	Catamount did not agree to amend the Master Subcontract with JAX;117
• 	JAX was still working on the underground for the roof drains after the
duration provided in the Schedule. The consequence of missing a
deadline on the Schedule is that if other contractors had not mobilized,
they would need to rework their forces, and if they are onsite, such as the
107 Id. at 40-41.
108 Id. at 43.
109 Id. at 44.
110 Id. at 69.
111 Id. at 47.
112 Id. at 49.
113 Id. at 79.
114 Id.
115 Id. at 49.
116 Id. at 50.
117 Id. at 51.
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concrete contractor on the Project, the concrete contractor is paying
lodging and per diems, when its crews are not working;118
• 	Prior to sending the Notice, Catamount sent notices to JAX regarding an
insufficient number of workers, incorrectly completed work, and failing
to maintain the Schedule;119
• 	A December 3, 2021, email stated the underground plumbing was not
complete causing delays to other contractors, and concrete and structural
steel contractors were threatening to remove their crews;120
• 	Had JAX performed timely, in December 2021, the framing of the
building would have occurred, and the building would have gone
vertical;121
• 	By December 2021, JAX had failed eight on-site inspections resulting in
duplication of work, rescheduled inspections, and additional lost time;122
• 	In December 2021, Kent, the concrete contractor, submitted a claim to
Catamount for delays and lost time;123
• 	JAX failed to provide sufficient on-site supervision, manpower, and to
abide by the Schedule at the time the Notice was issued.124
• 	Through the January 2022 pay application, Catamount paid JAX almost
$1,200,000.00;125
• 	On October 29, 2021, JAX should have been 100% complete with the
office underground plumbing and it was not complete as of March 21,
2022;126
118 Id. at 54-55.
119 Id. at 57-58.
120 Id. at 58-60.
121 Id. at 61.
122 Id. at 62.
123 Id. at 62-63.
124 Id. at 64-65.
125 Id. at 77-78.
126 Id. at 77.
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• 	On March 22, 2022, JAX emailed Catamount refuting any back charges,
and indicated it was demobilizing the Project. 127 JAX also stated it
expected to be paid for all work, and Catamount could finish the job with
another contractor at its own cost;128
• 	To stay on the Project, JAX required Catamount to waive all back
charges,129 and demanded cost plus an additional 5% for billing;130
• 	If Catamount had agreed to continue with no past or future back charges,
the completion of the underground work would have taken another 6
months and left Catamount with no remedy;131
• 	On April 8, 2022, JAX emailed Catamount indicating it would be leaving
the Project. JAX demobilizing was a further breach of the Project
Subcontract;132
• 	Catamount is seeking $2,841,177.00 in damages, which includes the
actual costs Catamount incurred to complete the Project.133
ii. 	Testimony of Lisl Unterholzner
Catamount retained Unterholzner, a certified CPA, who was qualified to testify
as an expert witness regarding the alleged fraudulent transfers. On May 21, 2026,
Catamount filed Unterholzner’s Expert Report (the “Unterholzner Report”) in which
she reviewed financial records to identify possible transfers made to insiders for which
JAX 	did 	not 	receive 	reasonably 	equivalent 	value.134 	The 	Unterholzner 	Report
provided:
127 Id. at 78.
128 Id. at 80.
129 Id. at 80, 84.
130 Id. at 84-85.
131 Id. at 80.
132 Id. at 87
133 Id. at 93-94.
134 Plaintiff’s Ex. 44.
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• 	Unterholzner was not provided with a complete set of financial records
and therefore could not reach definitive conclusions;135
• 	Based 	on 	the 	available 	documentation, 	Unterholzner 	could 	not
determine whether the Pre-Sale Transfers were made for a reasonably
equivalent value;136
• 	For the Lowery 2005 AMEX, Unterholzner identified $436,761.47 in
business 	expenses,137 	$190,548.27 	in 	personal 	expenses,138 	and
$165,191.77 in unknown expenses between March 29 and December 28,
2023.139
• 	JAX transferred $553,357.28, JAX HVAC transferred $31,000.00, and
unknown accounts transferred $260,115.21 to the Lowery 2005 AMEX
between March 29 and December 28, 2023;140
• 	Unterholzner 	classified 	$34,551.00 	in 	charges 	made 	to 	“DAILY’S
PLACE/BOLD EVENTS” (the “Daily’s Place Charges”),141 $23,747.50
in 	charges 	to 	“TM-JACKSONVILLE 	JAGUARS 	INH 	TICKET
AGENCY” (the “Jaguars Charges”),142 and $29,986.07 in charges to “IN
* ARENA STAFFING ONTARIO CA” (the “Arena Charge”) 143 as
personal expenses;
• 	Unterholzner classified $36,250.00 in charges to “IN*POSTILLION
TAX CONSULTANTS, LLC” (the “Postillion Charges”),144 $27,379.99
in charges to “AT&T PAYMENT” (the “AT&T Charge”),145 	and
$61,036.78 in charges to “BURR & FORMAN LLP – BIRMINGHAM”
(the “Burr & Forman Charges”) 146 as unknown or personal expenses;
135 Id. at 10.
136 Id.
137 Id. at 33, 55-57.
138 Id. at 33, 61-71.
139 Id. at 33, 58-60.
140 Id. at 33, 72.
141 Id. at 61, 63-69, 71.
142 Id. at 61-68
143 Id. at 67.
144 Id. at 58-59.
145 Id. at 58.
146 Id. at 43, 59. On December 12, 2023, Unterholzner marked $41,539.41 in charges to
“BURR & FORMAN LLP – BIRMINGHAM” as business expenses while classifying
the other charges differently.
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• 	For JAX’s corporate AMEX account ending in 7006 (the “JAX 7006
AMEX”), Unterholzner identified $17,782.81 in business spending,147
$3,080.97 in unknown spending,148 and $581.06 in personal spending
between October 22, 2023 and December 12, 2023;149
• 	The JAX 7006 AMEX received payments of $11,096.00 from JAX150 and
$7,000.00 from an unknown source between October 22, 2023 and
December 12, 2023;151
• 	The 	JAX 	AMEX 	ending 	in 	1003 	(the 	“JAX 	1003 	AMEX”) 	had
$1,146,993.45 	in 	business 	spending152 	and 	$33,855.00 	in 	personal
spending between October 22, 2023, and December 22, 2023;153
• 	The JAX 1003 AMEX received $958,367.13 from JAX,154 $227,594.24
from JAX HVAC,155 and $156,008.07 from an unknown source between
October 22, 2023, and December 22, 2023;156
• 	The 	LDDV 	AMEX 	had 	$106,246.92 	in 	business 	spending157 	and
$75,256.32 in personal spending158 between April 28 and October 27,
2023; and
• 	The LDDV AMEX received $241,661.00 in payments from JAX159 and
$155,998.49 in payments from an unknown source between April 28 and
October 27, 2023.160
147 Id. at 32, 50.
148 Id. at 32, 51.
149 Id. at 32, 52.
150 Id. at 32, 53.
151 Id. at 32, 54.
152 Id. at 31, 36-44.
153 Id. at 31, 45-46.
154 Id. at 31, 47.
155 Id. at 31, 48.
156 Id. at 31, 49.
157 Id. at 34, 75.
158 Id. at 34, 76-77.
159 Id. at 34, 78.
160 Id. at 34, 79.
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Unterholzner testified that:
• 	She reviewed financial records, accounts, and tax returns, to identify
where transfers had been made to insiders;161
• 	To the extent records were available to her, she attempted to determine
whether transfers were evidenced by value received by JAX;162
• 	On the XAJ 2023 and 2024 consolidated tax returns, XAJ is listed as
owning 100% of JAX and JAX HVAC, and Lowery owns 100% of XAJ.
If Lowery owns 100% of XAJ, he owns 100% of JAX and JAX HVAC;163
• 	Missing from her analysis were specific details of how the costs incurred
on the AMEX accounts were directly related to jobs performed by JAX
or JAX HVAC. Moreover, a large volume of records is missing for 2022,
and additional transfers were not analyzed because she did not have the
records.164
• 	Accounts payable documents for a construction company are typically
needed to justify their expenses, and she did not have such documents;165
• 	In June 2023, the Property Sale Proceeds were disbursed into the JAX
MS 5092 Account;166
• 	On June 27, 2023, $187,478.38 was transferred from the JAX MS 5092
Account to the LDDV AMEX. She confirmed this by matching the JAX
MS 5092 account statements and the LDDV AMEX statements and was
unable to conclude whether JAX received any value in exchange;167
• 	On October 27, 2023, $54,182.62 was transferred from the JAX MS 5092
Account to the LDDV AMEX and she did not find documents that
indicate JAX received value in exchange;168
161 Tr. at 114.
162 Id. at 114-115.
163 Id. at 116.
164 Id. at 118-120.
165 Id. at 122.
166 Id. at 126.
167 Id. at 127-128.
168 Id. at 130.
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• 	Between June 27, 2023 and October 27, 2023, two charges totaling
$105,946.92 from “THE RAE CORPORATION AC AND HEATING
EQUIP”169 could have been offset as business expenses;170
• 	There were no corresponding statements for the January 17 and February
6 Transfers;171
• 	There was accounting for the February 7 and April 6 Transfers;172
• 	For the January 17, February 7, and April 16 transfers she was unable to
determine whether JAX received any value in exchange;173
• 	For February 6 Transfers, she did not have a backup for the charges, and
there were no business records indicating a business justification for JAX
making the payments;174
• 	She could not identify value received by JAX for the $54,182.62 payment
to the LDDV AMEX in October of 2023;175
• 	Expenses paid from business accounts are generally presumed business-
related unless they appear clearly personal in nature;176
• 	For personal accounts, she treated charges as business-related only when
they 	were 	consistent with 	charges 	that 	appeared 	on 	the 	corporate
account;177
• 	Because the Lowery 2005 AMEX was a personal card, it was more
difficult to presume its charges were business expenses; she classified as
business only charges consistent with charges used in this type of
construction trade;178
169 Plaintiff Ex. 44 at 13.
170 Tr. at 150.
171 Id. at 131.
172 Id. at 131-132.
173 Id.
174 Id. at 133. Unterholzner did not account for the February 6, 2023 $150,000.00 transfer in
her analysis although it was on the same date and to the same account as the other February
6 Transfers.
175 Id. at 130.
176 Id. at 135.
177 Id.
178 Id.
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• 	Based on the XAJ 2023 consolidated tax return (the “2023 Tax Return”)
there 	was 	a 	decline 	in 	sales 	from 	$44,000,000.00 	in 	2022 	to
$10,000,000.00 in 2023;179
• 	The 2023 Tax Return shows a loan from a shareholder for $352,000.00
(the “2023 Shareholder Loan”) and repayment for which no further
documentation was provided. Lowery was the only shareholder of XAJ,
suggesting that he received $352,000.00;180
• 	The XAJ 2024 consolidated tax return (the “2024 Tax Return”) shows a
$604,382.00 shareholder loan (the “2024 Shareholder Loan”) by JAX, in
which there was no evidence of value received by JAX in exchange for
the loan;181
• 	JAX had negative equity at both the beginning and end of 2022 and in
her opinion restoring the transfers from April 2023-December 2023
would have resulted in positive equity.182 The negative equity position
from the 2023 Tax Return continued in the 2024 Tax Return;183
• 	She did not have an opinion on the validity, or the truthfulness of the
2021 financials provided by JAX to Catamount;184
• 	As for the Post-Sale Transfers, on the Lowery 2005 AMEX, she provided
$390,000.00 in payments from JAX and JAX HVAC, $337,000.00 in
business 	spending, 	and 	$53,000.00 	as 	the 	difference 	between 	the
payments by the business and the expenses that appear to be business
expenses;185
• 	She classified the Arena Charge as a personal charge, due to the Lowery
2005 AMEX being a personal card, and she did not have the records to
show Arena Staffing was an entity which was regularly paid or a business
record to show Arena Staffing was being used for a job;186 and
179 Id. at 141.
180 Id. at 143.
181 Id. at 144. Collectively the 2023 and 2024 Shareholder Loans will be referred to as the
“Shareholder Loans.”
182 Id. at 142-143.
183 Id. at 145.
184 Id. at 147.
185 Id. at 150-151.
186 Id. at 152.
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• 	She categorized the Daily’s Place Charges and Jaguars Charges as
personal expenses, upon her belief that they were charges on a personal
card and did not discuss the charges with Lowery.187
iii. 	Testimony of Daniel Zorrilla
On May 18, 2026, Daniel Zorrilla issued a written report.188 Zorrilla, President
of Oxley, Brannon & Zorrilla Consultants, was qualified as an expert on delay analysis
and contract administration.189 Zorrilla was to testify on behalf of Defendants
specifically about his opinions on the Schedule, delays, and compliance with the
Master 	Subcontract. 	Catamount 	objected 	to 	Zorrilla 	testifying 	as 	to 	contract
administration, and the Court allowed the testimony with a standing objection by
Catamount.
Zorrilla testified that:
• 	He reviewed the Complaint and project records and found no evidence
supporting the allegations;190
• 	Catamount wrongfully rejected JAX’s March Application because the
stated 	grounds 	did 	not 	justify 	a 	full 	rejection 	under 	the 	Project
Subcontract;191
• 	Catamount could withhold payment for defective work or for work
completed by a replacement contractor under the Project Contract;192
• 	Catamount’s denial of JAX March Application was unsupported, and
the Project Subcontract and industry standards did not allow for the
rejection, but he admitted that he had not seen the March Application;193
187 Id. at 152-153.
188 Defendants’ Ex. 1.
189 Id.
190 Tr. at 168.
191 Id. at 169.
192 Id.
193 Id. at 170.
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• 	The Master Subcontract specifically stated “time is of the essence” as for
the overall schedule of the Project;194
• 	The critical path consists of scheduled activities necessary to complete
the Project on time;195
• 	A subcontractor delay affects the overall Project only if it impacts the
critical path and extends Catamount’s completion time. He indicated
that the critical path could shift, but as long as the delay itself does not
require Catamount to be out there a day longer there is no delay to the
overall project;196
• 	He agreed with the Court that untimely submitting submittals, having to
dig up trenches twice, and late work could constitute a breach of the
Project Subcontract. However, if Catamount was not on the Project
longer than the Project Schedule, it did not suffer damages or incur delay
damages;197
• 	Catamount could potentially recover documented acceleration or work
around costs as back charges but could not obtain delay costs, absent
proof that JAX delayed the overall Project completion;198
• 	JAX was one day late on concrete paving and six days late on low-bay
roofing when Catamount terminated JAX;199
• 	Catamount reported to the owner of the Project it was on time, while
seeking 60 days of extended time damages from JAX and withholding
the March Application;200 and
• 	The Project Subcontract required no bond, imposed no personal liability
on Lowery, and contained no pledge of collateral.201
194 Id.
195 Id. at 172.
196 Id. at 173.
197 Id. at 174-176
198 Id. at 177.
199 Id. at 178.
200 Id. at 178.
201 Id. at 179-80.
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iv. 	Testimony of Mark Albert Lowery
Lowery, as the former President of JAX and in his individual capacity, testified
about his experiences with Catamount, his understanding of the events surrounding
the completion of the Project, his knowledge regarding the transfers at issue, and
generally as to the business’s operations and financial struggles prior to the bankruptcy
filings. Lowery testified:
• 	JAX bid the Project in April 2021 but was not awarded the Project until
late September;202
• 	Prior to the Project, JAX had worked on four to six projects with
Catamount;203
• 	In 2021, JAX managed about $30 million in work across multiple
divisions;204
• 	JAX had a full mechanical HVAC license in 43 states under Lowery’s
name. 	In 	Texas, 	JAX 	had 	a 	business 	license, 	mechanical 	license,
refrigeration license, and plumbing license;205
• 	In 2021, the construction industry was facing labor shortages, project
delays, 	supply-chain 	disruptions, 	material 	cost 	increases, 	and 	post
COVID instability;206
• 	Catamount asked JAX to purchase and store materials before the Project
began by which Catamount would pay to mitigate cost escalation, but
JAX declined to incur those costs before the award of the Project;207
202 Id. at 194.
203 Id. at 195-196.
204 Id. at 201.
205 Id. at 196.
206 Id. at 195.
207 Id.
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• 	For the Project and prior projects with Catamount, JAX hired local
workers in order to support both construction and post completion
warranty work;208
• 	The City of El Paso required a specific plumbing license, which JAX did
not obtain prior to the award of the Project, that ultimately led to a delay
in the start of the Project. The process to obtain the plumbing license
required hiring a subcontractor and took around 60 days from the award
date;209
• 	JAX agreed to the Schedule although he believed that it allowed virtually
no margin for delay;210
• 	Supply chain issues made obtaining submittals difficult, and mobilization
by September 29, 2021 was nearly impossible. Catamount listed October
7, 2021 as the contract date on the first pay application;211
• 	He attended some of the required meetings with Catamount but did not
refute that JAX was not in attendance for all of the meetings;212
• 	JAX made no delay claim before Catamount issued the Notice;213
• 	As a result of JAX’s closing down its business, he could not obtain
invoices, bank statements, and accounts payable records. Moreover, the
network and software were also inaccessible. In addition, all relevant
AMEX accounts were closed due to the Lowery Bankruptcy, resulting in
delay and incomplete document production;214
• 	He authorized the January 17, February 7, and April 6 Transfers;215
• 	In 2023, Lowery sold one of the JAX corporate divisions for roughly $1.2
million (the “Subdivision Sale Proceeds”), which prompted the creation
of XAJ. 216
208 Id.
209 Id. at 196-197.
210 Id. at 200.
211 Id.
212 Id. at 206.
213 Id. at 243.
214 Id. at 201.
215 Id. at 252.
216 Id. at 251.
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• 	January 17 and February 7 Transfers were repayment for the Trust Truist
Account paying for JAX business expenses.217
• 	In June 2023, outgoing wire transfers from the JAX MS 5092 Account to
the JAX Truist Account ending in 3511 for $170,000.00 were put into a
JAX operating account and used for labor and small materials;218
• 	JAX paid the LDDV AMEX because it was sometimes the only card
with available credit for JAX business expenses. The June 23 Payment
was likely to cover major purchases for a JAX project in Miami;219
• 	The 	Lowery 	2005 	AMEX 	received 	payments 	in 	the 	amount 	of
$978,000.00, which exceeded the Property Sale Proceeds, but Lowery
asserted the business expenses during that time far exceeded the Property
Sale Proceeds;220
• 	The Lowery 2005 AMEX was used as a JAX business card, and charges
such as the Daily’s Place Charges, Jaguars Charges, and Arena Charge
were marked as personal expenses rather than business expenses;221
• 	The Postillion, Burr & Forman, and AT&T Charges were miscategorized
as unknown or personal expenses rather than business expenses;222 and
• 	Lowery 	estimated 	$225,000.00 	in 	charges 	were 	miscategorized:
$146,000.00 	was 	categorized 	as 	unknown 	and 	$78,000.00 	was
categorized as personal, when both charges should have been categorized
as business expenses.223
v. 	Post-Trial Briefs
217 Id. at 237.
218 Id. at 228.
219 Id. at 228-29.
220 Id. at 231.
221 Id. at. 232-233.
222 Id. at 234-235.
223 Id. at 237.
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On July 10, 2026, the Parties filed their Post-Trial Briefs.224 As to JAX,
Catamount seeks a money judgment for breach of the Project Subcontract in the
amount of $2,841,177.00 and a determination under the Florida Uniform Fraudulent
Transfer Act (“FUFTA”) that JAX's transfers of its assets to insiders are avoided to
the extent necessary to satisfy Catamount's claim.225 As to Lowery, Catamount seeks
a money judgment under FUFTA in the amount of $2,791,650.00 along with a finding
the debt is nondischargeable under 11 U.S.C. § 523.226 Lastly, as to XAJ, Catamount
seeks a declaration that the Post-Sale Transfers and Shareholder Loans are fraudulent
as to Catamount and should be avoided.227 In their Post-Trial Brief, Defendants assert:
1) Catamount failed to prove JAX breached the Project Subcontract; 2) Catamount
was without justification to withhold the March 2022 Lowery pay application; 3)
Catamount failed to prove the fraudulent transfer allegations in Counts II and III; and
4) the Count V claims under 11 U.S.C. § 523(a) are without merit.228
Conclusions of Law
I. 	Count I: Breach of Contract
The Master Subcontract provides that it shall be interpreted under the laws of
the State of Kentucky.229 Accordingly, the Court applies Kentucky law to Catamount’s
224 Adv. Doc. 65; Adv. Doc. 66.
225 Adv. Doc. 65.
226 Id.
227 Id.
228 Adv. Doc. 66.
229 Plaintiff’s Ex. 3 at ¶ 38. Plaintiff cites to Florida breach of contract law in its Post-Trial
Brief. 	The 	Master 	Subcontract 	provides 	in 	the 	subsection 	titled 	Jurisdiction 	and
Arbitration/Litigation that the Master Subcontract will be interpreted under the laws of the
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claim that JAX breached the Project Subcontract. Under Kentucky law, a plaintiff
asserting a breach of contract claim must establish, by a preponderance of the
evidence,230 the existence of a valid contract, a breach of that contract, and damages
resulting 	from 	the 	breach.231 	A 	valid 	contract 	requires 	an 	offer, 	unequivocal
acceptance, sufficiently definite material terms, and consideration.232 In order to show
a breach occurred, Catamount must show JAX violated a contractual obligation or did
not perform in accordance with the Project Subcontract.233 Damages must be proven
with reasonable certainty and must generally place the injured party in the position it
would have been in had the contract been performed.234
Here, Catamount offered JAX subcontract work on the Project, and JAX
accepted by executing the Work Authorization, which contained the material terms
and provided adequate consideration, and incorporated the Master Subcontract. The
Court therefore finds that Catamount and JAX entered into a valid contract under
Kentucky law.
The preponderance of the evidence establishes that JAX breached the Project
Subcontract. The Master Subcontract required JAX to perform its work efficiently,
maintain the Schedule, avoid delaying other trades, provide sufficient skilled workers,
State of Kentucky. The Court’s ultimate finding of breach of contract by JAX under Count I
of the Complaint would be the same if Florida law were applied.
230 Arete Ventures, Inc. v. Univ. of Ky., 619 S.W.3d 906, 911 (Ky. Ct. App. 2020).
231 Saner v. Cabinet for Health and Fam. Services, 734 S.W.3d 778, 783 (Ky. App. 2026).
232 Univ. of Ky. v. Regard, 670 S.W.3d 903, 912 (Ky. 2023) (citing Britt v. Univ. of Louisville, 628
S.W.3d 1, 5 (Ky. 2021)).
233 See Metro Louisville/Jefferson Cnty. Gov't v. Abma, 326 S.W.3d 1, 10 (Ky. Ct. App. 2009).
234 Ford Contracting, Inc. v. Ky. Transp. Cabinet, 429 S.W.3d 397, 407 (Ky. Ct. App. 2014).
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and attend weekly contractor meetings. As shown through the evidence, JAX failed to
satisfy these requirements. Kentucky courts recognize that a subcontractor’s delays of
a construction project constitute a breach of contract.235
First, JAX fell behind the Schedule. Lowery testified that from the time of the
award of the Project, it took around sixty days to obtain the licensing required to be
able to complete plumbing work. The Schedule required that submittals were due
seven days after the Work Authorization was executed, and Metz testified that JAX
had not provided them at the time of termination six months later. The Schedule
allotted 14 days for underground roof drains and 27 days for underground office work
to be completed. Metz testified that neither was completed at the time of termination
in March 2022.
Second, JAX’s delays affected other trades. The Master Subcontract required
JAX to properly man the Project to work efficiently, maintain the schedule, and avoid
and prevent any delay or disruption to the progress of other trades. Metz testified JAX
did not properly complete the underground plumbing, and as a result was still working
on the underground plumbing after the duration provided in the Schedule. JAX was a
front-loaded trade, and the consequences of missing a deadline on the Schedule
required other contractors to rework their forces and incur fees such as per diems while
waiting to mobilize. The Schedule directly provides that JAX’s compliance with
235 See Wehr Constructors, Inc. v. Steel Fabricators, Inc., 769 S.W.2d 51, 55 (Ky. Ct. App. 1988)
(the Court there found that the subcontractor breached the contract by delaying the
construction project). If Florida law was applied to this analysis, the ultimate conclusions
would remain the same.
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deadlines was a requirement for other portions of the Project to be completed. The
underground for the roof drains was the sequence ahead of slab pours, and overhead
plumbing was the sequence ahead of mezzanine erection. Metz testified on December
5, 2021, that the underground plumbing was not complete, causing delays to the
concrete and structural steel contractors. Metz testified by December 2021, the framing
of the building should have been occurring, and the building would be going vertical.
Rather, Catamount was waiting for JAX to complete the underground. Ultimately,
due to the delays and lost time, the concrete contractor submitted a back charge claim
to Catamount. The Court finds that the continued delays and effects of such delays
were a breach of the Project Subcontract by JAX.
Third, JAX failed to provide sufficient labor and to adequately perform under
the Project Subcontract. Kentucky courts have found that a contractor’s termination
of a subcontractor for working without a full crew and not working expeditiously is a
valid default and constitutes a breach.236 The Master Subcontract required JAX to
provide enough properly skilled workers to efficiently complete the Project. 	Metz
testified that JAX failed to provide sufficient on-site supervision and manpower, and
at certain times, JAX had only two workers on site. Moreover, JAX’s crew made
multiple errors including failing inspections, backfilling a trench without proper
compaction, and taking more than 19 days to refill one sanitary line. As such, the
236 See Apex Contracting, Inc. v. William Robinson Const. Co., Inc., 581 S.W.2d 573, 577 (Ky. 1979)
(the Court found that the construction subcontractor defaulted through delays and defective
work, including refusing to provide a full crew for work).
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Court 	finds 	the 	insufficient 	labor 	and 	inadequate 	performance 	constituted 	an
additional breach of the Project Subcontract.
Fourth, JAX failed to have a representative attend the mandatory weekly
contractor meeting as required under the Work Authorization. Metz testified that JAX
had an individual named Reggie attend some of the required weekly meetings,
although Reggie stated he was only a temporary JAX employee, even though JAX
represented to Metz that Reggie was its representative. In addition, Lowery testified
that he attended several meetings but did not otherwise dispute that JAX failed to
attend all required meetings. As such, the Court finds that JAX’s failure to maintain
attendance at the weekly contractor meetings constituted an additional breach of the
Project Subcontract.
Thus, given JAX’s delays, delays to other contractors, failure to provide
sufficient workers, and failure to attend weekly contractor meetings, the Court finds
that JAX breached the Project Subcontract.
In addition, the Court finds that Catamount acted in compliance with the
Master Subcontract when terminating JAX on the Project. Catamount issued the
Notice, which JAX did not dispute, followed by the Second Notice, which was not
required, and the Termination Letter.
Kentucky courts have permitted recovery of contract damages established with
reasonable certainty, including appropriate costs resulting from construction delays.237
237 See Ford Contracting, 429 S.W.3d at 407; see Louisville & Jefferson Cnty. Metro. Sewer Dist. v.
T+C Contracting, Inc., 570 S.W.3d 551, 567 (Ky. 2018) (citing Cnty. of Galveston v. Triple B
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Catamount incurred damages through back charges and additional Project costs
attributable to JAX’s delays. Those damages included back charges from the concrete
contractor and other contractors due to JAX’s delays and general condition costs
charged to Catamount by other contractors, including equipment storage and lodging.
Additionally, the Master Subcontract required JAX to reimburse Catamount
for delay and completion costs and provided that, if the cost to complete JAX’s work
exceeded the unpaid contract balance, JAX would pay the difference. Kentucky courts
have permitted enforcement of contract provisions allowing a contractor to assess
damages against a defaulting subcontractor to complete the work, provided the
completion cost exceeds the original contract price.238 Here, like in Apex, Catamount
retained Duran Plumbing to complete JAX’s work and informed JAX it would be
charged for the completion costs. In its Post-Trial Brief, Catamount states the
$2,841,177.00 in damages is computed under Section 19A of the Master Subcontract,
the calculation includes completion costs and delay damages and credits the unpaid
contract balance.239
Based on the foregoing, the Court finds there was a contract, the Project
Subcontract, between Catamount and JAX, JAX breached the Project Subcontract,
Services, LLP, 498 S.W.3d 176, 181 (Tex. App. 2016) (the Court there found that delay
“damages compensate the contracting party that is injured when a project takes longer than
the construction contract specified”)).
238 See Apex, 581 S.W.2d at 577 (the Court there found that the contractor had sufficient
grounds to fire the subcontractor for defaults and delays, and the completion of the
subcontractor’s work could be charged to the subcontractor when it exceeded the original
contract price).
239 Adv. Doc. 65 at 5-6.
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and Catamount suffered damages in the amount of $2,841,177.00. Thus, the Court
finds in favor of Catamount as to Count I of the Complaint.
II. 	Count II: Fraudulent Transfer under Fla. § 726.105
Florida Statute § 726.105(1) provides two theories for fraudulent transfer claims:
actual fraud under subsection (1)(a) and constructive fraud under subsection (1)(b),
each of which must be established by a preponderance of the evidence.240 To prevail
under subsection (1)(a), Catamount must establish that (1) it was a creditor to be
defrauded, (2) JAX made the transfer with actual intent to hinder, delay, or defraud
Catamount, and (3) there was a transfer of property which could have been used to
pay the debt due.241 Under FUFTA, “transfer” includes “every mode, direct or
indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting
with an asset or an interest in an asset,” including the payment of money.242
To determine actual intent, courts consider the eleven statutory badges of fraud,
including whether the transfer was made to an insider, concealed, made while the
debtor was insolvent, or made without reasonably equivalent value.243 Courts may also
“consider the totality of the circumstances [to] determine whether any ‘badges of
fraud’ 	are 	present 	in 	connection 	with 	a 	particular 	transfer.”244 	Generally, 	a
240 Fla. Stat. §§ 726.105(1)(a)-(b); In re Orton, No. 3:17-AP-0148-JAF, 2018 WL 1577927, at
*2 (Bankr. M.D. Fla. Mar. 28, 2018). While Kentucky law is applicable to Count I, the Court
will apply Florida fraudulent transfer laws to Count II and III as the Complaint alleges these
actions under Florida law.
241 Fla. Stat. § 726.105(1)(a); Isaiah v. JPMorgan Chase Bank, 960 F.3d 1296, 1302 (11th Cir.
2020) (citing Wiand v. Lee, 753 F.3d 1194, 1199-1200 (11th Cir. 2014)).
242 Fla. Stat. § 726.102(14).
243 Fla. Stat. § 726.105(2); In re ATIF, Inc., 160 F.4th 1124, 1140 (11th Cir. 2025).
244 In re Dealers Agency Services, Inc., 380 B.R. 608, 613 (Bankr. M.D. Fla. 2007).
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combination of several badges of fraud may establish a prima facie case and create a
rebuttable presumption that the transactions are void,245 which the debtor may rebut
with evidence demonstrating the absence of an intent to hinder, delay, or defraud
creditors.246 Evidence that the debtor received value may help rebut the presumption
of fraud.247 The court may apply a totality of the circumstances test in determining
reasonably equivalent value.248 The party challenging the transfer has the burden of
proving the debtor received less than reasonably equivalent value.249 Under FUFTA,
a debtor is insolvent when its debts exceed its assets at a fair valuation,250 or when a
debtor is generally not paying its debts as they become due.251 Additionally, an insider
of a corporate debtor includes a director, officer, person in control of the debtor, or
relative of any of those individuals.252
To prevail under subsection (1)(b), Catamount must establish JAX did not
receive reasonably equivalent value and either had unreasonably small remaining
assets or believed, or reasonably should have believed, that it would incur debts beyond
its ability to pay.253 Value is given if, in exchange for the transfer, property is transferred
245 Wiand, 753 F.3d at 1200 (citing Gen. Elec. Co. v. Chuly Intern., LLC, 118 So. 3d 325, 327
(Fla. 3d DCA 2013); Johnson v. Dowell, 592 So. 2d 1194, 1197 (Fla. 2d DCA 1992)).
246 Mejia v. Ruiz, 985 So. 2d 1109, 1113 (Fla. 3d DCA 2008) (citing United States v. Fernon, 640
F.2d 609, 613 (5th Cir. 1981)).
247 Gen. Elec. Co., 118 So. 3d at 328; Mejia, 985 So. 2d at 1111.
248 Official Comm. of Unsecured Creditors v. State of Fla. (In re Tower Env’t, Inc.), 260 B.R. 213,
225 (Bankr. M.D. Fla. 1998).
249 In re ATIF, Inc., 160 F.4th at 1142.
250 Fla. Stat. § 726.103(1).
251 Fla. Stat. § 726.103(2).
252 Fla. Stat. § 726.102(8)(b).
253 Fla. Stat. § 726.105(1)(b).
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or an antecedent debt is secured or satisfied,254 and reasonably equivalent value need
not be dollar-for-dollar.255 Courts have recognized that the analysis for reasonably
equivalent value focuses on the benefit actually obtained by the debtor, and as such,
value is measured from the debtor’s point of view, not the transferee’s.256
Catamount 	alleges 	JAX 	fraudulently 	transferred 	funds 	to 	Lowery, 	Mrs.
Lowery, LDDV, and other insiders to hinder or delay payment of debt, JAX did not
receive reasonably equivalent value, JAX knew of Catamount’s claim and believed or
reasonably should have believed that it would incur debts beyond its ability to pay,
and Lowery is personally liable for the value of these transfers under § 726.105.
Catamount alleged multiple badges of fraud, including that transfers were made
to insiders with actual fraudulent intent, without reasonably equivalent value, and
JAX was insolvent at the time of the transfers. Those badges, however, are rebuttable,
and, ultimately, based on the record before the Court and the totality of the
circumstances, Catamount did not establish by a preponderance of the evidence that
JAX acted with actual fraudulent intent, received less than reasonably equivalent
value, or that JAX was insolvent at the time of the transfers.
a. 	The Pre-Sale Transfers
Although Catamount alleges the Pre-Sale Transfers were made to insiders,
without 	reasonably 	equivalent 	value, 	during 	a 	period 	of 	insolvency, 	those
254 Fla. Stat. § 726.104(1).
255 In re Berkman, 517 B.R. 288, 302 (Bankr. M.D. Fla. 2014); In re Advanced Telecomm. Network,
Inc., 490 F.3d 1325, 1336 (11th Cir. 2007).
256 In re Berkman, 517 B.R. at 301.
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circumstances, 	simply 	create 	a 	rebuttable 	presumption 	of 	actual 	fraud. 	First,
Defendants’ Post-Trial Brief disputes Catamount’s contention Defendants knew of its
existence as a creditor at the time of the Termination Letter, as Defendants stated they
never received any billings, communications, or other financial information related to
the allegations of breach and damages prior to the filing of the District Court Case.
Second, Lowery testified the Pre-Sale Transfers related to the Trust Truist
Account in January 2023 and February 2023 were related to the Subdivision Sale
Proceeds, and he used personal funds to pay JAX expenses with the anticipation he
would receive the Subdivision Sale Proceeds as value in exchange for the transfers. As
to the Pre-Sale Transfers related to the 3010 AMEX, Catamount failed to provide
evidence such as account statements to prove who the owner of the account was, and
there was less than reasonably equivalent value received in exchange. Catamount
bears the burden of proof to show that these were in fact fraudulent transfers. As such,
based on the totality of the circumstances and the record before the Court, Catamount
did not establish by a preponderance of the evidence that JAX made the Pre-Sale
Transfers with actual intent to hinder, delay, or defraud Catamount. Nor did
Catamount establish that JAX received less than reasonably equivalent value for the
Pre-Sale Transfers.257
b. 	The Post-Sale Transfers
257 Catamount also failed to prove who owned the 3010 AMEX account. Even if the Court
were to find that the Pre-Sale Transfers were fraudulent and benefitted Lowery and as such
were avoidable, the ruling in Count V of the Complaint provides that any claims personally
against Lowery are dischargeable.
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As to the Lowery 2005 AMEX, Unterholzner determined JAX and JAX HVAC
made a payment in the amount of $584,357.00, initially identifying $436,761.47 in
business expenses as value in exchange. Lowery, however, identified several charges
miscategorized as personal or unknown which were business expenses including:
$34,551.00 in Daily’s Place Charges, $23,747.50 in Jaguars Charges, $29,986.07 for
the Arena Charge, $36,250.00 in Postillion Charges, $27,379.99 in AT&T Charges,
and $61,036.78 in Burr & Forman Charges. Taking these adjustments into account,
business charges on the Lowery 2005 AMEX totaled $649,672.81, exceeding the JAX
and JAX HVAC’s payments by $65,315.53.
As to the LDDV AMEX, Unterholzner identified $241,661.00 in payments
from the JAX MS 5092 Account to the LDDV AMEX and initially identified
$106,246.92 in value received in exchange. Lowery testified, however, that the June
23 Payment was used to purchase materials for a JAX project in Miami. Taking the
June 23 Payment of $187,478.38 into account, business spending totaled $347,907.92,
exceeding the payments by JAX.
Although 	the 	evidence 	establishes 	transfers 	between 	JAX 	and 	accounts
associated with Lowery, Catamount has not established by a preponderance of the
evidence that the Post-Sale Transfers were made with actual intent to hinder, delay, or
defraud. Nor did Catamount establish by a preponderance of the evidence that JAX
received less than reasonably equivalent value.
While there is evidence that JAX was financially troubled, the record before the
Court does not support finding JAX was insolvent at the time of the Pre-Sale and Post-
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Sale Transfers. Based on the foregoing, the record before the Court, and the totality of
the circumstances, the Court finds in favor of Defendants as to Count II of the
Complaint.258
III. 	Count III: Fraudulent Transfer under Fla. § 726.106
A present creditor seeking to void a transfer must prove by a preponderance of
the evidence that the conveyance was fraudulent.259 Under § 726.106(1), a transfer is
fraudulent if a debtor made the transfer without receiving reasonably equivalent value
and was insolvent at that time or became insolvent as a result of the transfer or
obligation.260 The court may apply a totality of the circumstances test in determining
reasonably equivalent value.261 The party challenging the transfer has the burden of
proving the debtor received less than reasonably equivalent value.262 Alternatively,
under § 726.106(2), a transfer is fraudulent if made to an insider for an antecedent debt
while the debtor was insolvent and “the insider had reasonable cause to believe that
the debtor was insolvent.”263 As previously stated, a debtor is insolvent when its debts
exceed its assets at a fair valuation,264 or when a debtor is generally not paying its debts
as they become due.265
258 As previously stated, even if the Court were to find that transfers associated to Lowery
were made with actual fraud, the ruling in Count V of the Complaint provides that any claims
against Lowery personally are dischargeable.
259 In re Berkman, 517 B.R. at 300; Mejia, 985 So. 2d at 1113.
260 Fla. Stat. § 726.106(1).
261 In re Tower Env’t, Inc., 260 B.R. at 225.
262 In re ATIF, Inc., 160 F.4th at 1142.
263 Fla. Stat. § 726.106(2).
264 Fla. Stat. § 726.103(1).
265 Fla. Stat. § 726.103(2).
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Catamount alleges the transfers of the Property Sale Proceeds to Lowery, Mrs.
Lowery, and/or XAJ were fraudulent under Fla. Stat. § 726.106(1), as JAX did not
receive reasonably equivalent value and was insolvent when the transfers occurred or
became insolvent because of the transfers. Catamount also alleges that the Shareholder
Loans were made without JAX receiving reasonably equivalent value, that repayment
of the 2023 Shareholder Loan was a transfer to an insider on account of an antecedent
debt while JAX was insolvent, and that Lowery is personally liable for the value of
these transfers under §§ 726.106(1)-(2).
Catamount has not established by a preponderance of the evidence that the Pre-
Sale and Post-Sale Transfers and the Shareholder Loans were fraudulent under Fla.
Stat. § 726.106. As to § 726.106(1), Catamount failed to prove by a preponderance of
the evidence that the Pre-Sale and Post-Sale Transfers and Shareholder Loans were
made for less than reasonably equivalent value. As provided above, Catamount failed
to provide sufficient documentation necessary to show that JAX received less than
reasonably equivalent value for the Pre-Sale and Post-Sale Transfers. Additionally,
Catamount 	failed 	to 	provide 	bank 	statements 	or 	documentation 	regarding 	the
Shareholder Loans beyond the 2023 and 2024 XAJ Tax Returns. As such, the Court
is unable to determine whether there was less than reasonably equivalent value.266
266 Unterholzner did not draw any conclusions surrounding the Shareholder Loans, testifying
that while it could be suggested Lowery received the Shareholder Loans, there was no
documentation of the existence of the loans themselves or value received, and no other
evidence or testimony was provided to support Catamount’s contention.
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As to § 726.106(2), Catamount has not establish by a preponderance of the
evidence that the alleged repayment of the Shareholder Loan was to an insider on
account of an antecedent debt while insolvent.267 Here, similarly to the Court’s
findings as to § 726.106(1), Catamount failed to provide any documentation beyond
the 2023 and 2024 Tax Returns regarding the repayment of the 2023 Shareholder
Loan. 	While Catamount asserts the Shareholder Loans are separate from and not
duplicative of the Pre-Sale and Post-Sale Transfers, Unterholzner did not match
Shareholder Loans with JAX bank accounts and AMEX records and the Court was
also not able to come to this conclusion based on the record.268 As such, the evidence
did not establish that JAX repaid an insider on account of an antecedent debt while
insolvent or that the insider had reasonable cause to believe that JAX was insolvent.
Based on the foregoing and the totality of the circumstances, the Court finds in favor
of Defendants as to Count III of the Complaint.
IV. 	Count IV: Piercing the Corporate Veil
Under Florida law, to pierce the corporate veil, and hold a corporation’s owner
liable,269 the plaintiff must prove, by a preponderance of the evidence, that (1) a
267 Adv. Doc. 46.
268 Unterholzner noted in her expert report that she was not provided with all JAX bank,
investment, and credit card statements. Accordingly, there was not a complete record to make
a determination on the Shareholder Loans and many of the noted transfers. While Catamount
may assert that the additional necessary evidence was unavailable due to Lowery’s failure to
produce, Lowery does not bear the burden of proof. 	There was also no explanation from
Catamount as to why it did not seek discovery earlier and directly from certain sources, such
as Amex.
269 Molinos Valle Del Cibao, C. por A. v. Lama, 633 F.3d 1330, 1349 (11th Cir. 2011).
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shareholder dominated the corporation so that the corporation was nonexistent, and
the shareholder was the alter ego of the corporation, (2) the corporate form was used
fraudulently or for an improper purpose, and (3) the fraudulent or improper use caused
injury to the claimant.270
As to the first element, mere ownership or control, even when coupled with a
failure to observe corporate formalities, is insufficient; the relevant inquiry is whether
the corporation lacked an existence independent of its shareholder.271 To satisfy the
second element, a fraudulent or improper purpose must be shown, such as “a
subterfuge 	to 	mislead 	or 	defraud 	creditors, 	to 	hide 	assets, 	[or] 	to 	evade 	the
requirements of a statute.”272 The third element requires a causal connection between
the shareholder’s fraudulent or improper use of the corporate form and the plaintiff’s
injuries.273
At Trial, Catamount presented no evidence or argument specifically directed
toward piercing JAX’s corporate veil, and Catamount did not address Count IV in its
Post-Trial 	Brief. 	Accordingly, 	Count 	IV 	appears 	to 	have 	been 	abandoned.274
Nonetheless, the Court will address the merits of the claim.
270 In re Paul C. Larsen, P.A., 610 B.R. 684, 688 (Bankr. M.D. Fla. 2019), aff’d, 626 B.R. 446
(M.D. Fla. 2021) (citing In re Batcheler, 600 B.R. 680, 689 (Bankr. S.D. Fla. 2019)).
271 Id.
272 W.P. Prods., Inc. v. Tramontina U.S.A., Inc., 101 F.4th 787, 791 (11th Cir. 2024) (quoting
Lipsig v. Ramlawi, 760 So. 2d 170, 187 (Fla. 3d DCA 2000)).
273 In re Larsen, 610 B.R. 684, 691-92 (Bankr. M.D. Fla. 2019).
274 See In re McIntosh, 320 B.R. 22, 28 n.1 (Bankr. M.D. Fla. 2005) (the court found that when
no evidence is presented at trial a count can be seen as abandoned by the plaintiff).
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The evidence presented in this Proceeding does not establish that Lowery
dominated JAX to such an extent that JAX lacked an independent corporate existence.
JAX was an active, for-profit corporation and maintained multiple projects at once.
While Lowery exercised a high degree of control over the operations and decisions of
JAX, ownership and control alone are insufficient to establish that JAX was merely
Lowery’s alter ego.275 Accordingly, Catamount failed to establish the first element.
Nor has Catamount established the remaining elements. As discussed above,
Catamount failed to prove that Lowery used JAX to effectuate fraudulent transfers or
otherwise used the corporate form for a fraudulent or improper purpose. Without such
a showing, Catamount cannot establish that an improper use caused its injuries.
Moreover, 	the 	alleged 	damages 	resulted 	from 	JAX’s 	breach 	of 	contract 	with
Catamount, not from Lowery’s improper use of JAX. As a result, Catamount failed to
establish by a preponderance of the evidence the elements necessary to pierce the
corporate veil. Based on the foregoing and the totality of the circumstances, the Court
finds in favor of Defendants as to Count IV of the Complaint.
V. 	Count V: Nondischargeability under 11 U.S.C. § 523
275 In re Larsen, 610 B.R. at 688 (there the debtor was an active profit corporation until it filed
bankruptcy, filed annual reports with the Florida Secretary of State, and maintained a bank
account in its sole name. Although it did not maintain other corporate records “[e]ven if
Debtor [] did not follow corporate formalities, this alone is not enough to pierce the corporate
veil.”) (citations omitted).
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The preponderance of the evidence standard applies to all exceptions to the
dischargeability of debts under 11 U.S.C. § 523(a)276 and requires the creditor to
establish that the existence of a fact is more probable than its nonexistence.277
Exceptions to discharge are strictly construed against the creditor and liberally in favor
of the debtor.278 Section 523(a)(2)(A) of the Bankruptcy Code excepts from discharge
any debt “for money, property, services, or an extension, renewal, or refinancing of
credit, to the extent obtained by . . . false pretenses, a false representation, or actual
fraud.”279
Actual fraud is broad and encompasses any fraud involving “moral turpitude or
intentional wrong.”280 Thus, actual fraud under § 523(a)(2)(A) does not require a false
representation and may encompass fraudulent conveyance schemes.281 Nevertheless,
§ 523(a)(2)(A) requires that money or property giving rise to the debt be “obtained by”
the fraud.282 Accordingly, when nondischargeability is premised on a fraudulent
transfer, the creditor must establish that the debtor obtained money, property, or
276 Grogan v. Garner, 498 U.S. 279, 291 (1991); United States v. Watkins, 10 F.4th 1179, 1184
(11th Cir. 2021) (citing Metro. Stevedore Co. v. Rambo, 521 U.S. 121, 137 n.9 (1997) (internal
quotation omitted)).
277 Watkins, 10 F.4th at 1184-1185 (citing Concrete Pipe & Prods. of Cal., Inc. v. Constr. Laborers
Pension Tr. for S. Cal., 508 U.S. 602, 622 (1993) (internal quotation omitted)).
278 Harris v. Jayo (In re Harris), 3 F.4th 1339, 1345 (11th Cir. 2021) (citing Hudson v. Raggio &
Raggio, Inc. (In re Hudson), 107 F.3d 355, 356 (5th Cir. 1997); Gleason v. Thaw, 236 U.S. 558
(1915)).
279 11 U.S.C. § 523(a)(2)(A).
280 Husky Int’l Elecs., Inc. v. Ritz, 578 U.S. 355, 360 (2016) (quoting Neal v. Clark, 95 U.S. 704,
709 (1878)).
281 Id. at 359-360.
282 SE Property Holdings, LLC v. Gaddy (In re Gaddy), 977 F.3d 1051, 1057-58 (11th Cir. 2020).
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services by actual fraud and that the debt sought to be excepted from discharge resulted
from the debtor’s fraudulent receipt.283
Here, Catamount has not established actual fraud as to Lowery. As discussed
above, Catamount failed to prove by a preponderance of the evidence that the Pre-Sale
and Post-Sale Transfers and Shareholder Loans constituted fraudulent transfers
involving Lowery. Moreover, even assuming the transfers constituted actual fraud,
Catamount has not established that the debt it seeks to except from discharge resulted
from those transfers.
In In re Gaddy, the Eleventh Circuit held that a debtor’s fraudulent transfers,
which 	were 	made 	after 	incurring 	a 	contractual 	obligation, 	did 	not 	render 	the
preexisting debt nondischargeable under § 	523(a)(2)(A) because the debt was not
“obtained by” the alleged fraud and the transfers were, if anything, an alleged effort to
thwart collection of an already existing obligation.284 The Eleventh Circuit further
noted that a § 523(a)(2)(A) claim fails when the plaintiff “did not contend that the
underlying debt from the guaranties was obtained by fraud or was anything other than
a standard contract debt.”285 The Eleventh Circuit subsequently confirmed that Husky
and In re Gaddy require a creditor to establish both the debtor’s fraudulent receipt of
money or property and that the underlying debt sought to be excepted from discharge
resulted from the fraudulent receipt.286
283 PRN Real Est. & Invs., Ltd. v. Cole, 85 F.4th 1324, 1346 (11th Cir. 2023).
284 In re Gaddy, 977 F.3d at 1057-58.
285 Id. at 1058.
286 PRN Real Est., 85 F.4th at 1346.
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Following 	the 	Eleventh 	Circuit’s 	reasoning, 	JAX’s 	underlying 	debt 	to
Catamount arose from JAX’s breach of contract, which existed before the alleged Pre-
Sale and Post-Sale Transfers. Even if Catamount had satisfied its burden of proof as to
Lowery’s receipt of fraudulent transfers, such receipt does not in and of itself translate
to a finding that the debt should be excepted from discharge under 11 U.S.C. §
523(a)(2)(A). Catamount alleges that Lowery’s subsequent participation in the Pre-
Sale and Post-Sale Transfers and Shareholder Loans constituted actual fraud on which
Catamount justifiably relied and that caused Catamount’s loss in the amount of the
debt. However, even if the Pre-Sale and Post-Sale Transfers and Shareholder Loans
constituted actual fraud, they would not transform such debt into a debt “obtained by”
fraud under § 523(a)(2)(A).
Accordingly, Catamount failed to prove by a preponderance of the evidence
that any debt owed by Lowery to Catamount was obtained by actual fraud. The Court
therefore finds in favor of Lowery and against Catamount as to Count V, and any such
debt is not excepted from Lowery’s discharge under § 523(a)(2)(A).
In conclusion, the Court finds in favor of Catamount as to Count I; in favor of
Defendants as to Counts II, III, and IV; and in favor of Lowery as to Count V. The
Court will enter a separate judgment consistent with these Findings of Fact and
Conclusions of Law.
Case 3:25-ap-00107-JAB Doc 69 Filed 09/23/26 Page 49 of 49