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EXHIBIT 33
Case 1:20-cv-00658-LMB-IDD Document 132-33 Filed 05/07/21 Page 1 of 26
PageID# 2753
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IN THE UNITED STATES DISTRICT COURT
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FOR THE EASTERN DISTRICT OF VIRGINIA
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Alexandria Division
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BLUE FLAME MEDICAL, LLC, )
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)
Plaintiff, ) Civil Action No.
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)
vs. ) 1:20-cv-00658
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)
CHAIN BRIDGE BANK, N.A., ) (LMB/IDD)
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JOHN J. BROUGH, and DAVID )
M. EVINGER, )
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)
Defendant. )
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___________________________ )
CHAIN BRIDGE BANK, N.A., )
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)
Third-Party Plaintiff, )
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)
vs. )
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)
JPMORGAN CHASE BANK, N.A., )
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)
Third-Party Defendant. )
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16
REMOTE VIDEOCONFERENCE
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VIDEO-RECORDED DEPOSITION OF DAVID EVINGER
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Friday, January 29, 2021, 9:32 a.m.
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Oak Hill, Virginia
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21
Reported By: Marjorie Peters, FAPR, RMR, CRR, RSA
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Job Number: 4398572
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Q. I'm just asking about what you read.
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You're aware that, for example,
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Regulation J specifically allows a return if a
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deposit was made into the wrong account; correct?
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MR. ORSECK: Object to form.
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Foundation.
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A. I believe there's a provision for that
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type of return.
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Q. And there's also a provision for a
10
return if it was a duplicate wire transfer, when
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only one was made.
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Do you recall that?
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MR. ORSECK: Object to form.
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A. I recall that there is a return
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provision for duplicate.
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Q. Neither of those circumstances were
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present in connection with the wire that was made to
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Blue Flame Medical from the State of California; is
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that correct?
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MR. ORSECK: Object to form.
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A. I think, Mr. White, there were other
22
elements present that were -- that caused us concern
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that were being evaluated, but your question --
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Q. That's not responsive to that question.
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Was there any concern that the
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amount that was wired in Blue Flame Medical was sent
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into the wrong account? Did that concern exist?
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MR. ORSECK: Object to form.
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A. I don't believe that was the case for
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this particular wire.
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Q. In fact, the wire was meant to be sent
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by the State of California into the account for Blue
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Flame Medical that Chain Bridge Bank helped; isn't
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that right?
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A. I believe that is the case; it went to
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the proper account.
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Q. And --
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A. Can I interrupt real quick, Mr. White?
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I have someone outside my door that has -- there's
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some disruption. Would you allow me just 15
19
seconds; I can just ask them to lower their voice.
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MR. WHITE: Sure. We can take a
21
break for -- there's no reason for you to have to
22
rush that. We can take a break for a couple of
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circumstances certainly warranted it, along with the
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very large size of the money that was coming in.
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Q. The records we have seen, Mr. Evinger,
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indicate that this conversation lasted about 19
5
minutes.
6
Does that accord with your
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recollection of the length of the conversation that
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you and Mr. Brough had with Mr. Gula and Mr. Case?
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A. Yes, that does.
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Q. Did Mr. Gula tell you about Blue Flame
11
Medical during that conversation?
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A. He provided us with a brief overview of
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Blue Flame Medical, and its intended new business.
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Q. I take it he told you as well about the
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contract to supply 100 million N95 masks to the
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State of California; correct?
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A. He reviewed the contract with the State
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of California with us, and gave us an overview.
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Q. I take it he also told you or confirmed,
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because you had already heard it, that Blue Flame
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was expecting a wire for over $450 million either
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that day or the following day from the State of
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California; is that right?
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MR. ORSECK: Object to form.
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A. Mr. Gula was asking us on the call
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several times whether the wire had arrived yet or
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not. He had -- he has wanted to know if it had hit
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our wire room on our call, and asked if we could
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check.
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Q. Did you all check during the call?
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A. I do recall checking, and I e-mailed him
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back. Whether it was during the call or shortly
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thereafter -- I know we did it after. But I'm not
12
sure if we did it during the call because we were
13
talking to him, but he wanted us to verify whether
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the wire had already arrived or not.
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Q. He disclosed to you the amount of the
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wire that he was expecting; is that correct?
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A. Yes. He told us it was going to be for
18
$450 million, approximately, and it was a down
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payment towards a larger amount -- contract that
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they had with the state.
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Q. Do you recall him telling you that the
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manufacturer of the masks -- one of the
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manufacturers was a Chinese company called Great
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Health Companion?
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Do you recall that coming up during
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the call?
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A. He spoke about a company. I believe
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that was correct. Great Health -- Greater Health.
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I believe he referenced that.
8
Q. And that they were going to be
9
manufacturing the masks in China; is that correct?
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A. Yes. The masks would be manufactured in
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China.
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Q. Did he also tell you the name of the
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company that was -- that was the owner of
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Great Health Companion, Hakim Unique -- I am sorry,
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Hakim Unique Internet Company?
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Did he tell you that?
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A. I seem to recall that, yes. And it was
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hard to understand what it -- what the name was on
19
the call or to spell it, but that sounds like
20
something -- yes, that sounds as if that was said.
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Q. And he told you that Blue Flame was
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going to use the funds wired by California to pay
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the suppliers of the masks for California's order;
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isn't that right?
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A. He gave us rough -- rough details. He
4
was not specific with amounts or -- or dates or
5
times. It was general -- generalizations were
6
provided.
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Q. Did he confirm, as you had heard before,
8
that Blue Flame would not be wiring all of the funds
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that were wired to it out of the account at
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Chain Bridge Bank?
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Do you recall him saying that?
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A. I don't -- I don't -- I don't remember
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exactly it said that way, but it came across is that
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there would be money moving out within several days
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or sooner, for purchases of personal protective
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equipment.
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He was not able to provide us with
18
exact information of that or the timing or the
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dollar amounts of those outgoing at that point of
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the call.
21
So I don't know how much would be
22
remaining in the account, if you will.
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So I think the conversation probably
2
had many components to it, and it had elements of
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what -- what would be money remaining in the bank.
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But it was a very high-level overview versus a very
5
granular discussion.
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Q. Do you recall Mr. Gula offering to
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answer any questions or provide any documentation
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that you might request regarding the transaction
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during this phone call?
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A. He offered to provide documentations.
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We requested documentation to support this large
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amount, this contract, for a new company.
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Q. I take it, it is not your role as
14
bankers for your customer to do diligence for the
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State of California on their contracting
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counterparties, is it?
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Do you view that as part of your
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role?
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MR. ORSECK: Object to form.
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A. So our job is to know our customer and
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to know their business with respect to new accounts,
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onboarding of those accounts, any unusual
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The money was actually conveyed to
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Chain Bridge's account, wasn't it?
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A. I was referring -- referring to the
4
contracts. Sure. The money was wired by the State
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of California.
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Q. Based on their contract with Blue Flame
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Medical, as they said; correct?
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A. Again, we -- I had no contract to
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review, so I didn't have anything to -- to validate
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that.
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Q. My question was whether they told you
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they had an agreement with Blue Flame Medical.
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Did they tell you that, the State of
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California?
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A. They said they were doing business with
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Blue Flame Medical.
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Q. Just like he told you they were;
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correct?
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A. It appeared that Blue Flame had made
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arrangements with California, but, again, we didn't
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have any supporting documentation as to the contract
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underlying terms or anything.
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A. Can you repeat that again?
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Q. You ultimately did become satisfied that
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California had reached an agreement with Blue Flame
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Medical to pay them to provide these masks; isn't
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that correct?
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A. I guess I have -- you're asking me how
7
did California --
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Q. Let me try it again.
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A. Yeah. Can you please --
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Q. The State of California -- the State of
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California informed you that they had an agreement
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with Blue Flame Medical to pay Blue Flame Medical to
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provide these masks; correct?
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A. They referenced Blue Flame Medical when
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we spoke to them, but we didn't get any -- any other
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information related to specifics of their due
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diligence process.
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Again, they were...
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Q. I didn't ask you about their due
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diligence process. What I asked you is whether they
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represented to you, Chain Bridge Bank, that they had
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an agreement to pay this money to Blue Flame Medical
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to supply N95 masks; isn't that true?
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A. They referenced that Blue Flame Medical
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was their vendor, but that's what I can recall.
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Q. And that $450 million-plus had been sent
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to Chain Bridge Bank to pay for N95 masks for the
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State of California from Blue Flame Medical.
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They confirmed that, too, didn't
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they?
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A. There was conversation about that on the
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phone call.
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Q. So that's a "yes," California did
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confirm that; right?
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A. It confirmed the amount of the intended
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wire.
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Q. And what it was for; correct?
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A. They believed they were purchasing N95
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masks.
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Q. And that's exactly what Mr. Gula told
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you that the agreement was; correct?
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A. That's what Mr. Gula thought he was --
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he was entering into, but, again, we didn't have any
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documentation to support it.
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Q. As a matter of fact, you at one point on
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the 26th informed your entire staff at Chain Bridge
3
Bank not to contact Mr. Gula; is that correct?
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A. We sent an e-mail to our team to stand
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down, essentially, to not contact him, so we could
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continue to do our due diligence.
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Q. If your concern was the contracts,
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Mr. Evinger, why didn't someone contact Mr. Gula on
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the 26th to let him know that that was your concern?
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A. I believe we were fairly clear with him
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on our need and in the follow-up e-mail of what we
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wanted.
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So I didn't feel like there was a
14
requirement to follow up with him. I think if you
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wanted to supply those, he knew that those were
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necessary for the bank, and that we were needing
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them.
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Q. Are you saying that during your
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conversation with Mr. Gula on the 25th, you told him
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that the contracts were necessary in order to
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process this transaction; is that what you're
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saying?
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A. What I'm saying is that we asked him for
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contracts to support this very large and unusual
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wire for a new business, and we needed those for
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support.
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Q. When did you contact --
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A. We didn't know --
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Q. When did you contact Mr. Gula on the
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26th?
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A. I don't know that I spoke -- e-mailed
10
him back on the 26th. I can't recall. I spoke to
11
him in person on the 26th.
12
Q. After the money had been returned to
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California; correct?
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MR. ORSECK: Object to form.
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Foundation.
16
Q. You can answer.
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A. Mr. White, our conversation in person
18
with Mr. Gula was prior to the funds being returned.
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Q. When was your -- what time of day was
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your conversation with Mr. Gula?
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A. Approximately 2:30 p.m.
22
Q. So the funds were still in Blue Flame
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You can answer, if you are able to
2
understand the question.
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A. I have nothing further on this topic.
4
Q. You mentioned a call after the wire came
5
in. What was the next sequential call that you were
6
involved in? Was it with the State of California or
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JPMorgan?
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A. Are you referring to following our call
9
with JPMorgan, Mr. White?
10
Q. Actually, I mean on the 26th. You
11
didn't have any communications with Mike Gula on the
12
26th; is that correct?
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MR. ORSECK: No. Objection to form.
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A. Met with him in person.
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Q. Prior to meeting with him in person,
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were there any other communications that you had
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with Mr. Gula on the 26th?
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A. I don't recall there being any.
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Q. You did have communications about this
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wire transfers with others outside the bank. I
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think you mentioned conversations with the State of
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California representatives and JPMorgan.
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Do I have that right?
2
A. That's correct.
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Q. Which one was first?
4
A. So we placed an initial phone call to
5
the Department of General Services. That was an
6
initial outreach shortly after receiving the wire.
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There was really no communication with that call.
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Q. What was the purpose of that call?
9
A. We wanted to confirm that they, being
10
California, intended to order or have a contract for
11
$450 million with Blue Flame Medical.
12
Q. Did they confirm that?
13
A. Well, Mr. White, our initial call was
14
simply to leave our name and number and who we were,
15
to return our call. We didn't speak to anyone with
16
any -- any specificity.
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MR. WHITE: I'm going to load up
18
Tab 16, Greg. It's a transcript of a -- I believe
19
it's a voicemail that we received in discovery,
20
although I'll ask you to describe what it is.
21
It would be the next sequential
22
Plaintiff's Exhibit, which is --
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MR. COLWILL: 67. It's an audio
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recording.
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MR. WHITE: Plaintiff's Exhibit 67.
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It's what?
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MR. COLWILL: Audio recording.
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MR. WHITE: It's an audio recording.
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Thank you.
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(Plaintiff Exhibit 67, audio recording, CBB00000707,
9
was marked for identification.)
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(Audio recording played.)
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Q. Mr. Evinger, was that a voicemail --
12
excuse me -- left on your office line on the 26th of
13
March?
14
A. Yes.
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Q. This is in response to the call you made
16
to the State of California seeking confirmation
17
about the wire transfer; is that correct?
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A. Yes.
19
Q. Ms. Chang -- Ms. Chang, I'm sorry,
20
confirmed that the wire transfer in the specific
21
amount from the State of California was a legitimate
22
transfer; is that correct?
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A. That's what the message said, yes.
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Q. Then you called her back; right?
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A. Yes. We called back. We wanted to
4
speak with her directly.
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MR. WHITE: If you could play Tab
6
17. This will be the next sequential exhibit
7
number.
8
(Plaintiff Exhibit 68, audio recording, CBB00002543,
9
was marked for identification.)
10
MR. COLWILL: 68.
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MR. WHITE: It's an audio recording,
12
Plaintiff's Exhibit 68.
13
(Audio recording played.)
14
BY MR. WHITE:
15
Q. Mr. Evinger, that's your voice on that
16
call; correct?
17
A. Yes, it is.
18
Q. How did this call come to be recorded?
19
A. John Brough used his cell phone.
20
Q. Was John Brough -- were you in your
21
office when you placed this call?
22
A. Yes, we were.
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Q. I take it you placed the call in
2
response to the voicemail; is that correct?
3
A. That's right. The call was placed based
4
on the number left on the voicemail.
5
Q. I note that the recording starts in the
6
middle of the call.
7
Do you know why that is?
8
A. I don't know.
9
Q. Did Mr. Brough or you let Ms. Chang know
10
that the call was being recorded?
11
A. I don't recall that coming up, no.
12
Q. Did Mr. Brough take out his cell phone
13
to record this call?
14
A. I don't -- I don't remember.
15
Q. Why did you want to talk to the
16
treasurer's office?
17
A. I think it would be appropriate for us
18
to get confirmation from the source of the payment,
19
that it was properly authorized for this amount of
20
money. It was also offered and we accepted. We
21
didn't reject it. It would...
22
Q. After this call, you did, in fact, have
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a call with the California State Treasurer's Office;
2
correct?
3
A. They did -- they did eventually call us,
4
yes.
5
Q. That was a Mr. Mark Hariri and
6
Ms. Natalie Gonzales; is that right?
7
A. Yes. That sounds right. I think she
8
may go by Saunders [ph]. I'm not 100 percent sure
9
of that.
10
Q. Did they say why they were calling?
11
A. They were following up on the request
12
for -- from the Department of General Services for
13
Ms. Chang.
14
Q. Did they confirm for you that the wire
15
transfer was indeed in connection with an agreement
16
with Blue Flame Medical to supply N95 masks?
17
A. They made reference to that the state
18
was attempting to purchase N95 masks.
19
Q. Why did you want to speak with them?
20
A. We wanted to confirm that the wire was
21
proper -- properly authorized in their office, and
22
that the funds were intended to go to Blue Flame
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Medical, and they knew about the -- about the
2
overall transaction.
3
Q. And you confirmed that the funds were
4
properly authorized; correct?
5
A. There was a discussion about that.
6
Q. And they told you that the fund -- that
7
the transfer had been authorized to Blue Flame
8
Medical; correct?
9
A. They said that the funds were approved
10
for the purchase.
11
Q. And that the funds were being sent to
12
Blue Flame Medical for the purchase of N95 masks;
13
correct?
14
A. That's what they thought they were
15
purchasing, yes.
16
Q. And that Blue Flame Medical was the
17
intended recipient; correct?
18
A. They referenced Blue Flame, I believe,
19
yes.
20
Q. So they had confirmed all of the aspects
21
that you wanted confirmed; that there was an
22
agreement with Blue Flame Medical, and they meant to
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research on their end and work with their bank,
2
JPMorgan, who had made outreach, apparently.
3
Q. Ms. Gonzales recalls that during that
4
conversation, she asked whether the money -- the
5
wire had been deposited into the Blue Flame Medical
6
account.
7
Do you remember her asking about
8
that?
9
A. There was a discussion about funds, and
10
if they had -- they were in the account and had --
11
was all of the money still available or was money
12
not there.
13
And so I think that she asked --
14
inquired about did we still have possession of the
15
money, and she was comforted that we had the money
16
and a hold on it while they and we determined if it
17
was all in place properly.
18
Q. She calls you saying that the money had
19
not been deposited into the Blue Flame Medical
20
account. Is her recollection on that accurate?
21
A. Well, what I recall is we were
22
discussing Chain Bridge Bank having possession of
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the money, and it was all still there.
2
I guess, in my terminology, if I
3
said, you know, we had a hold on it, so -- and the
4
availability would have been subject to our funds
5
availability policy.
6
So I don't know that I -- I know we
7
talked about funds and whether they're still there
8
at the bank. If her impression was that -- that I
9
said no, I don't -- I don't know that I have any
10
information to recollect that, and I don't have -- I
11
don't have a memory of that specifically, but I know
12
we talked about whether the funds were still at the
13
bank and whether we had possession of them and would
14
hold them during this time.
15
But my -- my statement, I guess
16
would --
17
Q. But -- go ahead. Go ahead.
18
A. So I was going to say that if I heard
19
you correctly, she was saying the funds -- she --
20
can you repeat the question again, I guess?
21
I lost my train of thought.
22
Q. That's fine.
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Is it your testimony that you did
2
not tell her that the funds had already been
3
credited to the Blue Flame Medical account?
4
MR. ORSECK: Object to form.
5
A. I don't know that I specifically said --
6
again, my conversation would revolve around us
7
holding the funds, having control of the funds while
8
she worked to do further work with the department
9
and her -- her office, JPMorgan.
10
Q. Her recollection is that you told her
11
that the funds had not been credited to the
12
Blue Flame account at the time of your conversation.
13
A. I guess there's a difference in
14
terminology.
15
MR. ORSECK: Hey. You didn't get a
16
question yet. You didn't get a question yet.
17
Q. You may finish. Difference in
18
terminology about what?
19
MR. ORSECK: Object to form.
20
A. Going back to the conversation we had
21
about whether we had possession of the funds or not,
22
the terminology, to me, credited would mean final
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credit versus memo post with a hold, but that was a
2
general term.
3
I don't know that -- I don't recall
4
the specific details of that conversation, but we
5
did talk about maintaining the funds until there was
6
further resolution on their end.
7
They agreed to do so.
8
Q. Did you tell her at this point that the
9
funds were in the Blue Flame account?
10
A. Again, I -- I don't recall that specific
11
point. I recall a general conversation about the
12
bank having the funds and having a hold on them.
13
If that implied that they were in
14
the account, I don't have any reason -- I don't know
15
what she was thinking about. She didn't -- she
16
wasn't overly specific one way or the other about
17
it. She just wanted, I think, a -- general
18
knowledge that we -- we had still control of the
19
wire.
20
Q. But, in fact, the funds were, in fact,
21
in the Blue Flame Medical account subject to the
22
hold that you spoke of; is that correct?
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MR. ORSECK: Object to form. Asked
2
and answered.
3
Q. You can answer.
4
A. Sorry, Mr. White. I was taking a sip of
5
water.
6
Q. All right.
7
A. So as I said, the funds were memo-posted
8
to the client's account and then a hold placed
9
during this process, so I think there was some
10
confusion around that terminology and how it was
11
conveyed.
12
My memory was that the conversation
13
was more around the bank maintaining that hold
14
while -- while they did more research.
15
Q. How were the funds logistically moved
16
out of the Blue Flame account and back to California
17
by Chain Bridge Bank?
18
A. JPMorgan sent a wire recall notice over
19
Fedline.
20
Q. Did you inform JPMorgan that the money
21
was in the customer's account, and not in the bank's
22
general ledger account at the time?
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