In a fraudulent-transfer lawsuit arising out of a bankruptcy action, a Florida bankruptcy court ruled that a defendant-bank’s assertion of a good-faith defense waived the attorney–client privilege over emails between bank employees and its counsel.  The court, however, limited the waiver to documents evidencing the bank’s state-of-mind during the period of the alleged improper transfers.  In re: Mongelluzzi, 2017 WL 1843049 (Bankr. M.D. Fla. May 8, 2017).  You may read the decision here.


Frank Mongelluzzi owned and operated several companies, and he and his business entities maintained 61 accounts at a regional bank.  After Mongelluzzi and his companies filed bankruptcy, the bankruptcy trustees filed various complaints against the bank seeking to avoid allegedly fraudulent transfers under 11 U.S.C. § 548.

The trustees claimed that Mongelluzzi and his companies had engaged in a check-kiting scheme, that the bank had knowledge of this scheme, and that the bank devised a controlled exit strategy to reduce its financial exposure from $25M to $3M.

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