Energy magnate T. Boone Pickens has filed a lawsuit in Texas state court against realtor Gannon Properties and its affiliates, accusing the company and its principal of fraud over $4.1 million in unpaid loans.
According to the lawsuit, Pickens won a previous case against Gannon and its principal, William Franke, over two unpaid promissory notes amounting to $4.1 million. The current lawsuit accuses Franke of improperly transferring portions of the company to his wife through other entities, in what the suits claims was an attempt to avoid paying the debt.
The lawsuit alleges violations of the Uniform Fraudulent Transfers Act, conspiracy and tortious interference with contract.
The lawsuit claims that the original promissory notes were issued by PlainsCapital Bank to Gannon Joint Venture LP, and that Pickens purchased the loan in 2013. After a repayment dispute, Pickens won a lawsuit against Gannon.
According to the current suit, six months after the ruling in Pickens’ favor, Franke transferred his interest in Gannon to his wife in an attempt to avoid his legal obligations. The lawsuit also claims that Franke and the company used the corporate structure improperly, failing to document transactions or keep independent records. Furthermore, Franke and Gannon allegedly used one another’s bank accounts and funds as their own.
The lawsuit seeks compensatory and exemplary damages, attorney’s fees and an injunction preventing further transfers of assets.