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$32 Million Verdict in Gold Smuggling Case

Counsel Financial

Lies, scandal, greed, and conspiracy – all elements of a box office hit. Add gold, oil, African warlords, government corruption and throw in a U.S. basketball star, and you have the stranger than fiction civil tale which recently riveted a Dallas County jury. The jury awarded Southlake Aviation and its owner, David Disiere, $32.4 in damages against Houston based oil company, CAMAC International, subsidiary CAMAC Aviation and Mukaila Aderemi “Mickey” Lawal, Vice President of African Operations for CAMAC Aviation.

The case began on February 5, 2011 when authorities in the Democratic Republic of Congo seized a $43 million Gulfstream jet loaded with ten thousand pounds of gold that was to be smuggled out of the country. CAMAC International and its officers previously had leased the aircraft from Southlake Aviation, reportedly to travel between CAMAC’s headquarters and its oil operations in Nigeria. The lease specifically prohibited operating the aircraft in or over any hostile areas, or anywhere subject to a U.S. export law or a U.N. Security Counsel Directive.

The jury heard the movie-script like testimony from a diamond trader involved in the smuggling plot that CAMAC and its officers - Chairman and CEO, Kase Lawal (a member of one of President Obama’s trade advisory committees), and his brothers, Kamoru and Mickey Lawal, traded suitcases containing $6.5 million in cash for 10,000 pounds of gold from Congolese military commander, General Bosco Ntaganda. Ntaganda had been indicted for numerous war crimes by the International Criminal Court, including allegations of recruiting child soldiers and presiding over mass rapes and murders of civilians. Ntaganda funded his activities by smuggling natural resources, like gold, out of the country. According to U.N. Security Council report, even after learning the notorious General Ntaganda was involved, the Lawals did not terminate their deal to buy the gold. The Security Council concluded that the Lawals had committed “serious violations of international law involving the targeting of children or women in situations of armed conflict.”

The jury then heard that the UN Security Counsel investigation also implicated former Houston Rocket and NBA star, Dikembe Mutombo, for acting as an intermediary in the cash-for-gold scheme.

Because the aircraft was confiscated in the Congo, VFS Financing, the company that provided the loan to Southlake Aviation to finance the purchase the Gulfstream, immediately placed the loan in default for violating the lease provision, accelerated the balance due and repossessed the aircraft. Although VFS was able to sell the Gulfstream for $25 million, it sought over $17 million from Southlake and Disiere for the difference between the sale price and the loan. Southlake and Disiere in turn, looked to CAMAC and its officers for compensation.

David Disiere testified that he never met any of the Lawals and denied any knowledge of their plans to take the Gulfstream to the Republic of Congo, stating that CAMAC had contracted with his company for proposed legitimate travel to its Nigerian oil operations. He demanded indemnification by CAMAC under the lease for their negligence, willful misconduct, and/or gross negligence in regards to the Gulfstream. Defendants denied all allegations; they claimed they made timely lease payments, and that Plaintiff’s actions were barred in the terms, conditions, and disclaimers of the lease agreement. Mickey and Kamoru Lawal also alleged that they were not liable for damages because they never signed the lease agreement in their individual capacity.

The jury found that CAMAC and its officers violated the U.S. Trading With The Enemy Act and were liable for conversion, returning a verdict in favor of Southlake Aviation and Disiere for $32,400,000. Based on Defendants’ challenges on the conversion claims, the court reduced Plaintiffs’ award to the following: (1) $13,400,000 jointly and severally from CAMAC Aviation and CAMAC International; (2) $2,323,038 plus reasonable attorneys fees of $433,854 from CAMAC Aviation; (3) $315,000 jointly and severally from CAMAC International and Mickey Lawal; and (4) $2,835,000 from CAMAC International; plus 5% prejudgment interest and court costs.
VERDICT: $32,000,000
ACTUAL: $19,306,892 plus 5% prejudgment interest and court costs
COURT: 134th Judicial District, Dallas County, Texas

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