On July 16, 2021, Yetter Coleman and co-counsel won a $30 million jury verdict on behalf of our client Twinwood against the American Akaushi Association (AAA), HeartBrand, and the principal of both companies, Ronald Beeman.
The suit centered on the duties of the AAA, a cattle breed association for a rare breed of Japanese cattle known as Akaushi or Red Wagyu. AAA advertised to members that they will receive a DNA verified pedigree on registered animals and certificates of registration verifying the animals’ lineage, which are critical to the value of elite breeds of cattle.
Twinwood was an AAA member for years and registered hundreds of animals with the association. But when Twinwood asked for proof of DNA verified pedigrees in 2016, AAA refused, claiming it did not provide such information “as a matter of policy.” In discovery and trial, we learned that AAA had failed to DNA verify the lineages of more than half of Twinwood’s registered animals. After a four-week trial in Fort Bend County, Texas, the jury unanimously found in favor of
Twinwood’s claims for breach of contract, fraud, tortious interference, conspiracy, and alter ego. The jury found AAA had fraudulently concealed its breaches and tortious conduct for several years. The verdict awarded more than $21 million in damages for breach of contract, an additional $1.3 million for fraud, $3.3 million in exemplary damages, and attorney fees. The jury also found HeartBrand was the alter ego of AAA and responsible for its conduct. HeartBrand is appealing the judgment.
While the appeal was pending, HeartBrand attempted to post a supersedeas bond of approximately $6 million based on its purported net worth. Yetter Coleman successfully argued that HeartBrand’s net worth is approximately $22 million more than it claimed, which increased the bond by $11 million. HeartBrand appealed this order, and the Fourteenth Court of Appeals affirmed most of the trial court’s findings. The Texas Supreme Court denied mandamus.
The case is significant in that it clarifies and enforces the duties of trade and breed associations to their members and the requirements for posting an adequate supersedeas bond.