In one of his first rulings as a U.S. District judge in Oklahoma City, Judge Patrick R. Wyrick decided part of a case involving a nearly $20 million deficiency judgment, a bankruptcy and a claim against British Petroleum over the 2010 Deepwater Horizon Oil Spill.
He dismissed efforts of Neverve, LLC, Oklahoma City attorney Ruston C. Welch and the Welch Law Firm in a fight with SE Property Holdings, LLC of Oklahoma
SE Property, known as SEPH won a $19,661,891.08 deficiency judgment against Neverve stemming from loans it failed to repay SEPH had succeeded Vision Bank which made the loans that were secured by property and personal guarantees of Neverve members David and Terry Stewart.
The Stewarts were forced into involuntary bankruptcy and moved the bankruptcy to Oklahoma City. SEPH learned that the only significant remaining asset that could be used to pay down the deficiency was Neverve’s claim against BP which arose from the Deepwater Horizon Oil spill of 2010.
But the Stewarts entered into a representative agreement with Ruston Welch where the Stewart related entities guaranteed his led fees. Asthe court ruling pointed out, unknownst to SEPH or the bankruptcy court, Neverve settled its BP claim and transferred the settlement money to Welch and his firm. Welch was later sanctioned $25,000 by the bankruptcy court for failing to disclose the source of his compensation.
SEPH claimed the transfer was “fraudulent” and wanted to sue the law firm the attorney and Neverve. It also filed for relief from an automatic stay in the bankruptcy case. Neverve, Welch and the Welch law firm went to Oklahoma State district court for declaratory relief and the case ended up in federal court where Judge Wyrick dismissed their efforts.