Exhibit 102, Video-Recorded Deposition of David Evinger — Blue Flame v. Chain Bridge (Document 150-18)

Summary

Exhibit 102 is a remote videoconference, video-recorded deposition of David Evinger taken in Blue Flame Medical, LLC v. Chain Bridge Bank, with questions from Mr. White and objections from Mr. Orseck. Evinger testifies that the bank asked Mr. Gula for contracts to support a large and unusual transaction for a new business, and that staff were told to stand down temporarily while the bank cleared the transaction. Evinger also testifies that the funds were memo-posted to the Blue Flame account and a hold was placed on it. Evinger says the bank proposed that it could hold the money or return the money.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

EXHIBIT 102
Case 1:20-cv-00658-LMB-IDD     Document 150-18     Filed 05/20/21     Page 1 of 17
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Page 1
IN THE
E'OR THE
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
A]-exandria
Division
BLUE FLAME MEDICAL, LLC,
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Plaintiff,
Civil
Action No.
vs
L:20 -cv-00 658
CHAIN BRIDGE BANK, N. A. ,
JOHN .I. BROUGH , and DAVf D
M. EVTNGER,
( LMB / tOO',t
Defendant.
CHAIN BRIDGE BANK, N. A
I
Third-Party
Plaintiff
,
vs.
;'PMORGAN CHASE BANK, N.A. ,
Third-Party
Defendant
REMOTE VIDEOCONFERENCE
VIDEO-RECORDED DEPOSITTON OF DAVID
Friday,
January 29, 202L, 9232
Oak Hi11, Virginia
EVINGER
a.m.
Reported By : Marj orie Peters , FAPR, RMR, CRR, RSA
Job Number z 439857 2
212-267-6868
516-608-2400
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provided our
a.
So
Page 160
team in that area.
from your perspective, a deposit of
not have been any problem for the
ratios;
is that accurate?
you referring
to the March time
March time frame? We woul-d
and
that size would
bank's capital
A.
Are
frame
end of
put
have any
ratios,
I talked to you about, it
into a zero risk-weighted
negative irnpact on our
wouLdn't have had
if
asset, it would not
risk-based capital
slight decJ-ine to
as
and it, would have had a
our J-everage ratio for the purposes of our
March 31st cal-]. report.
frorn your perspective, there was no
of capital. ratios with taking in
a.
So
problem in terms
this deposit; is
A.
Just
hold
hold this
at the time.
that correct?
in and of itself
r wG were abJ-e to
money based on our capital- level-s
A.
Moving up the chain, there was an e-maiJ-
that Mr. Brough eras copied onr which is the one that
he forwarded to you. That's the one I'd like to
look at no!'t.
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Page 228
THE VIDEOGRAPHER: We ' re back on the
record.
The time is 4:05 p.m.
BY MR. WHITE:
A.
Mr. Evinger, hopefully,
w€ have
downloaded Plaintiff's
Exhibit 66, so that you can
l-ook at it.
It's
a one-page e-maiI.
(PLaintiff
Exhibit 66, e-mail 3.26.2020 ,
CB800002686, was marked for identification.)
A.
Let me know when you have it.
A.
I do have it.
A.
Mr. Gula here is sending you a link to
the website for Blue Flame Medical; is that correct?
A.
Yes.
A.
Is that the sort of information that you
had requested that Mr. Gul-a provide on the 25th when
you spoke to him?
A.
My discussion with him was about
about the contracts themselves, not about his
website.
A.
Did you e-mail Mr. Gula back and ask for
copies of the contracts?
A.
I don't reca1l doing sor no.
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a.
the 26Eh
Bank not
A.
As a matter
informed your
to contact Mr
?Ie sent an
Page 229
of fact, you at one point on
entire staff at Chain Bridge
Gul-a; is that correct?
e-mail to our team to stand
down, essentially,
continue to do our
a.
Mr. Evinger,
the 26En. to
A.
on our need
wanted.
wanted to supply those, he
necessary for the bank, and
them.
A.
Are you saying
conversation with Mr. Gula
didnrt someone contact Mr. GuIa on
to not contact him, so we could
If your
due diligence.
concern was the contracts,
why
l-et him know that that was your concern?
I believe we were fairJ-y clear with hin
and in the follow-up e-mail of what we
So I didn't fee]- like there was a
requirement to follow up with him. I think if you
that the contracts were necessary
process this transaction;
is that
saying?
knew that those were
that we were needing
that during your
on the 25thr you told him
in order to
what yourre
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A.
contracts
wire for
support.
a.
A.
a.
26Eh?
A.
a new business,
needed those for
?Ihen did you contact
We didn' t know
Tlhen did you contact Mr. Gula on the
f donrt know that I spoke
recalL.
I spoke to
him in person on the 26Eh.
A.
After the money had been returned to
Cal-if ornia; correct?
MR. ORSECK: Object to form.
Page 230
What Ifm saying is that we asked him for
to support this
large and unusual
very
and we
e-mailed
him back on the 26Lh.
I canft
Person
returned.
day was
Foundation.
A.
You can answer.
A.
Mr. White, our conversation in
with Mr. Gul-a was prior to the funds being
A.
When was your
what time of
your conversation wj.th Mr. GuIa?
A
a
Approximately 2 z 30
So the funds were
p.m
still-
in Bl-ue Flame
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Page 231.
Medical's account at that point?
A.
Funds had not been returned by the bank
at that point.
a
Medical's
So they
account at
were still
in Blue Flame
that point; is that correct?
ORSECK: Object to forrn.
MR
A.
Sorry, Mf,. Vlhite.
Irm going to go on to
this version.
Sorry.
I apologize.
Can you repeat your question again?
A.
So the funds were stil1
in BJ-ue Flame
Medical-'s account at 2z3O when you spoke with
Mr. Gul-a; is that correct?
MR. ORSECK: Objection.
Lack of
foundation.
A.
Again, the funds were stil-l- with
with
the bank at that point.
We had not
the wire
process
recal.l process had not been conducted.
A.
And specifical-J-y, the funds were in BIue
Flame Medical's account at the bank; correct?
A.
I believe their funds were soft-posted
or memo-posted to their account.
A.
Which means they were in the account,'
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Page 232
correct?
MR. ORSECK:
A.
Again, they
memo-posted to
to the
were
Object to form.
they were
account. A hoLd placed
during the investigation.
A.
It's
a simple
it's
a simpJ-e question,
Mr. Evinger.
Were the funds in Blue Flame's
account?
MR. ORSECK: Objection.
Asked and
answered.
You should answer the question as
you believe to be truthful- and accurate
A.
As I stated, the funds
to the BLue F1ame account. A hold
A.
Okay. So they were in
account; correct?
were memo-posted
placed on it.
the BLue Flame
MR. ORSECK: Objection.
Asked and
answered.
A.
You're going to need to answer that
question, or we're going to do it for the rest of
the day.
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Page 233
MR. ORSECK: Objection.
Answer the question as you believe
truthful- and accurate, and ig'nore the haranguing.
A.
I guess I'11 repeat rny understanding of
how the wire was received.
It was memo-posted into
the client' s account, with a hoLd pJ.aced on it
while
while we conducted our due diJ-igence.
A.
Was the hold placed on it imrnediateJ.y at
the
when it was put into Bl-ue FLame's account,
the funds?
A.
There was instructions
provided to place
a hold whiLe we
while we investigated what was
going on.
A.
When was the time sequence between the
hold and the money being posted in the account?
A.
It would have been minutes afterwards.
I don't know the exact time.
So the money was put in the account, and
then
hold was put on the
MR. ORSECK:
money; is that correct?
Objection.
Foundation.
a process f just
described.
a
4
A
That' s
thatr s
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Page 234
A.
I just want to make sure I have the
sequence correct.
The money was put into Blue FLame
Medical ' s account, and then sometime shortJ-y
thereafter,
a hold was put on the money. Is that
the correct sequence?
MR. ORSECK: Object to form.
Mischaracterizes the testimony.
A.
Mr. White, the money was in
was
memo-posted to the client's
account, and a hol-d was
placed on it minutes after its arrival.
A.
So there was a period of time during
which the money was in the account and not subject
to a hold; is that correct?
MR. ORSECK: Sarne objection.
A.
Mr. ?Ihiter w€
the funds avail-ability
policy
provide
wheLher
wouldn't have permitted us
those funds until- the next
to provS-de
business day, so
there rras or wasnrt, the wire was
it wouldn't be available to the
next business day.
funds avail-abl-e
By the wdy, on the
memo-posted, and
client until- the
a
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Page 235
policy,
the bank has the capacity to make exceptions
to that, doesn't it?
A.
I think the bank can make exceptions to
policies in a g'eneral statement, but with respect to
funds availability
poJ-icyr w€
for brand-new
accounts, that's our
that's our policy,
so...
A.
The bank has made exceptions to that
policy for long-term customers in the past; isn't
that correct?
A.
I don't know if we have or we haventt.
A.
You're not aware of a singJ-e instance
where the bank has made an exception to the funds
a 24-hour hold on funds'
avail-able poJ-icy that
availabiJ.ity;
is that what you're saying?
I think,
ORSECK: Objection to form.
Mr. lfhite, the policy is in
so that accounts are used in a
place for a reason,
has
MR
A
Proper manner,
of an account
and that moneys don't come in and out
in a manner that's inconsistent with
Laws and regulations.
a
Mr. Evinger, is
Chain Bridge Bank has never
testimony that
exception to
it your
made an
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that policy?
A.
we have never made an
saying that that's our
implement that policy.
Page 236
Is that what your testimony is?
That's not my testimony.
Irm not saying
exception to it.
policy,
and we
Irm just
would
A.
And you have
exception to it because
the authority to make an
it is your policy;
correct?
A.
It is our policy.
IVe can
but that's
why we have it is to
for this instance, for when
there's new accounts, and there's activity
unusual and large activity
or unusual circumstances
surrounding an account, but we haven't been able to
conduct our proper due diligence.
This alL goes
part and parcel with it.
A.
I'm sorry.
You still
havenrt answered
the question whether the bank has ever made an
exception to that poJ-icy.
Can you just answer that question?
A.
I
I don't have an example for you, so
I dontt know.
A.
If you were so curious about the
contracts, !ilhy did you tel1 your staff not to have
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Page 237
any contact or return calls from Mr. Gula on
March 26En.?
MR. ORSECK: Object to form.
A.
At that stager wG wanted to make sure
that information was conveyed through .fohn or
myseJ-f .
We didnrt want to have our staff to be put
in
put in a position where they weren't clear as
to what was going on.
TIe had people who were working
remoteJ-y from their
homes .
We had people who
werenrt informed of necessariJ-y what was going on.
It was moving very quickly and rapidly the night
before.
So we told them to stand down
temporariJ.y while rre
needed to clear this
A.
Mr. GuIa
repeatedly on March
A.
It's
my
bank a fair
amount.
he was coming to the
A.
Did you
tried to get the information we
w1re.
tried to get in
26Eh, didnr t he?
understanding he
He e-mailed me,
bank.
respond to any of
touch with you
!ilas calling
the
I believe, that
those cal-l-s or
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e-mails?
A.
I don't
I
his e-mail or speaking to
but lve did meet with him
a
Is it the bank's
Page 238
don't recall responding to
him on the telephone, Dor
Ln Person.
policy not to have
communication with its customers when they have
questions?
A.
Mr. White, I don't think it's
for to us have an hour or two to do our
unreasonable
proper review and conduct our due diligence.
don't think that's an inconvenience.
I think that's trying to
regulations
new business
in this
with an
I
get the
to make sure
case, and we
unusualJ.y
transactions
right answer here.
I think it's
trying
we follow
l-aws and
don't al-Low for a
J.arge-size transaction to conduct any
inappropriately.
thing.
And
appropriate
the client
So I do think we did the right
I do think this space al.lowed us
time to do that.
We ultimately met with
face-to-face.
When you met with him face-to-face,
did
a
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Page 239
you tell- him that you needed to see the contracts?
A.
At that pointr wG informed him that the
wire had been recaLled by the State of California,
and that he would really need to take that up with
them. He understood.
a.
So from the morning of the 26Lle when he
sent you the e-mail about the website until
when you met with him and tol-d him that the
California
had recal-Led the wire, did you return any
of Mr. Gula's calJ-s or messages to you and teII
him
that what you realJ.y needed to see was the
contracts?
A.
I don't recall- speaking to him during
that period of time either by telephone or e-mail.
A.
That's because you didn't
speak with
him; correct?
A.
That I
I don't recal-l- speaking to him
during that time.
A.
If your concern was reaIly the
contracts, why not call your J-oya1 customer and let
him know, look, w€ rea1ly need to see the contracts?
tlhy didnrt you do that , Lf that was
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Page 255
I lost rny train of thought.
I know youtre going to
t'el-I me I already know the question, but could you
please repeat it again?
A.
You know what, I'rl not.
It is J.ate in
the day, and Mr. Orseck has a fair point.
Let's
move on from that.
During this conversation, did you
offer to return the wire to California?
A.
I don't recall it being on our first
f irst
cal-l- with California.
I spoke to them. They
seemed a litt1e
bit unsure, and they were going
to
they had outreach apparently from ,.TPMorgan, so
I think the two banks calling about the same
transaction caused thern some confusion.
They wanted to take some time and
revisit,
get back to us.
A.
Did you offer to return the wire?
A.
In part of our discussion, we proposed
that we could hoLd the money r ot lre could return the
money. They did not want us to return the money at
that stage.
They were continuing to conduct some
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Page 256
research on their end and work with their bank,
,IPMorgan, who had made outreach, apparently.
A.
Ms. Gonzal-es recal-ls that during that
conversation, she asked whether the money
the
wire had been deposited into the Blue Flame MedicaL
account.
Do you remember her asking about
that?
A.
There was a discussion about funds, and
if they had
they were in the account and had
was all of the money sti1l
available or was money
not there.
And so I think that she asked
inquired about did we still
have possession of the
money, and she was cornforted that we had the money
and a hold on it while they and we determined if it
was alJ. in pJ-ace properly.
A.
She call-s you saying that the money had
not been deposited into the Blue F1ame Medical
account. Is her recol-lection on that accurate?
A.
WelI, what I recaLl is we were
discussing Chain Bridge Bank having possession of
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