Nance sued by Introgen debtors

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IN THE UNITED STATES BANKRUPTCY COURT
FOR THE WESTERN DISTRICT OF TEXAS
AUSTIN DIVISION
In Re: §
§
Introgen Therapeutics, Inc., § Case No. 08-12442-CAG
Introgen Technical Services, Inc., § Jointly Administered
§
Debtors. §
§
§
Introgen Therapeutics, Inc., and §
Introgen Technical Services, Inc., §
§
Plaintiffs, §
§
vs. § Adv. Proc. No. ________________
§
David G. Nance §
§
Defendant. §
COMPLAINT
Introgen Therapeutics, Inc. (“Introgen”) and Introgen Technical Services, Inc. (“ITS” and
together with Introgen, the “Debtors” or the “Plaintiffs”) in this Chapter 11 proceeding file this
Complaint against David G. Nance (“Nance”), allege:
PARTIES AND JURISDICTION
1. The Debtors may be served in this adversary proceeding through the undersigned
counsel.
2. David G. Nance is an individual who may be served with this complaint and
summons at 8203 Scenic Ridge Cove, Austin, Texas 78735.
3. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A), (C), (F), (H), and
(O).
4. Venue is proper in this district pursuant to 28 U.S.C. § 1409(a).

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5. This Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and
1334. Relief is sought pursuant to 11 U.S.C. §§ 548 and 550 and other applicable law.
SUMMARY OF THE DEBTORS’ COMPLAINT
6. The Debtors seek to (i) recover payments made by the Debtor to Nance pursuant
to 11 U.S.C. § 548 of the Bankruptcy Code and TEX. BUS. & COM. CODE ANN § 24.001 et seq.
and (ii) recover from Nance expenditures authorized by him and/or reimbursed to him for waste.
In addition, the Debtors seek their attorneys’ fees, costs and interest in accordance with
applicable law.
STATEMENT OF RELEVANT FACTS
7. Nance was Debtor’s CEO and President from August 1, 1996 until March, 2009.
Nance was also a shareholder and the Chairman of the Debtors’ board of directors.
8. Nance’s base salary was approximately $594,944 per year. A copy of Nance’s
2007 Employment Agreement is attached hereto as Exhibit “A.”
9. The Debtors and Nance entered into an employment agreement (the “Employment
Agreement”) that authorized Nance to be reimbursed for reasonable travel expenses on the same
terms as the remainder of the Debtors’ employees. A copy of Nance’s 1996 Employment
Agreement is attached as Exhibit “B.” During the four years’ preceding the filing of the
Debtors’ voluntary petitions for relief under chapter 11 of title 11 of the United States Code (the
“Bankruptcy Code”), Nance incurred $793,282.01 in travel expenses. Based on Domestic
Lodging and Meal costs under the United States General Service Administration Per Diem rates
for domestic travel and the United States State Department rates for foreign travel, those
expenses exceeded reasonable travel expenses by $669,380.26. This figure of excessive
expenses includes 100% of unnecessary and wasteful expenditures for stand-by limousine
expenses, hotel room rates in excess of $900 per night, unexplained expenditures at Prada and

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Hermes in Milan, thousands of dollars in wine and spirits expenditures, golf equipment, first
class airfare, and men’s clothing. A list of excessive and unnecessary expenditures is attached
hereto as Exhibit “C.” These expenditures resulted in no benefit to the Debtors and exceed the
reasonable reimbursement to which Nance was entitled under his Employment Agreement.
10. Further, Nance, in order to garner friendship or standing with Pieter Mulier
(“Mulier”), arranged to have a Hummer purchased and shipped overseas to Mulier. The costs of
the purchase of the Hummer are detailed on Exhibit “D.” It also appears that some of the travel
expenses incurred by Nance were for travel not reasonably related to the business of the Debtors
but was in furtherance of Nance’s obsequious relationship with Mulier and others and include
golf vacations and hunting lodge expenditures.
11. On December 3, 2008, the Debtors filed their voluntary petitions for relief under
Chapter 11 of the Bankruptcy Code.
FRAUDULENT TRANSFERS UNDER 11 U.S.C. §§ 548(a)(1)(A) AND 548(a)(1)(B)
12. The Debtors incorporate paragraphs 7 through 11 as stated herein. The excessive
travel reimbursements in the amount of $340,067.22 and the purchase of the Hummer and
expenses related thereto in the amount of $87,922.25 at Nance’s behest for Mulier within 2 years
of the Petition Date (collectively, the “2-year Transfers”) constitute avoidable transfers under §
548(a)(1)(A). Specifically, the 2-year Transfers were of an interest of the Debtors in property
and/or were obligations to or for the benefit of an insider and were made within 2 years of the
petition date. The 2-year Transfers where made with an actual intent to hinder, delay, or defraud
the Debtors on or after the date that the 2-year Transfers were made; and/or obligations were
incurred; and/or the Debtors were indebted as a result of the 2-year Transfers. 11 U.S.C.
§548(a)(1)(A).

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13. The 2-year Transfers constitute avoidable transfers under § 548(a)(1)(B).
Specifically, the 2-year Transfers were of an interest of the Debtors in property and/or were
obligations to or for the benefit of an insider and were made within 2 years of the petition date.
The Debtors received less than reasonably equivalent value in exchange for the 2-year Transfers.
At the time of the 2-year Transfers, the Debtors were insolvent, or became insolvent as a result
thereof; were engaged or were about to engage in business in which its property after making the
2-year Transfers was unreasonably small capital; and/or intended to incur or believed it would
incur debts that it would be unable to repay; and/or made such transfers to or for the benefit of an
insider not in the ordinary course of business. 11 U.S.C. § 548(a)(1)(B).
14. Under § 550(a) of the Code, the Debtors may recover the property transferred or
the value of such transfer from “the initial transferee of such transfer or the entity for whose
benefit such transfer was made.” 11 U.S.C. §550(a). Nance is the initial transferee of the 2007-
2008 Transfers. The Debtors are entitled to recover the value of the 2007-2008 Transfers plus
pre- and post-judgment interest.
FRAUDULENT TRANSFERS UNDER §§ 24.005(a)(1) AND 24.005(a)(2) OF THE
UNIFORM FRAUDULENT TRANSFER ACT
15. The Debtors incorporate paragraphs 7 through 11 as stated herein. The 2004-
2008 Transfers of approximately $669,380.26 (collectively, the “2004-2008 Transfers”) were
made in violation of TEX. BUS. & COM. CODE ANN. § 24.005(a) et seq. Specifically, the
2004-2008 Transfers were made to an insider with actual intent to hinder and/or delay and/or
defraud creditors of the Debtors in violation of TEX. BUS. & COM. CODE ANN. §
24.005(a)(1). The 2004-2008 Transfers were made to an insider for less than equivalent
consideration and the Debtors (i) were engaged in business for which the remaining assets were
unreasonably small in relation to the Debtors’ businesses; or (ii) reasonably should have known

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that the Debtors were incurring debts beyond their ability to repay them. TEX. BUS. & COM.
CODE ANN. § 24.005(a)(2). A creditor exists whose claim arose before or within a reasonable
time after the occurrence of the 2004-2008 transfers, for whom the Debtors can act. The Debtors
seek a money judgment for the value of the 2004-2008 Transfers.
CORPORATE WASTE UNDER DELAWARE LAW
16. The Debtors incorporate paragraphs 7 through 11 as stated herein. Nance,
without consent of the Debtors’ board of directors, wasted corporate assets by draining Debtors’
operating funds on 2-Year Transfers or the 2004-2008 Transfers (collectively, the “Transfers”).
The Debtors received no consideration in exchange for the Transfers. Or, in the alternative, if
the Debtors did receive consideration in exchange for the Transfers, the consideration was so
disproportionately small as to lie beyond the range at which any reasonable person might take.
The Debtors’ seek a money judgment for the value of the Transfers.
SELF-DEALING
17. The Debtors incorporate paragraphs 7 through 11 as stated herein. Nance, as the
President and CEO of the Debtors, owed a fiduciary duty to the Debtors. As a fiduciary, Nance
had a duty to refrain from self-dealing. Nance, through his unnecessary and extravagant
expenditures, engaged in systematic self dealing subjecting the Transfers to scrutiny for overall
fairness. The Debtors’ seek actual and exemplary-damages as a result of Nance’s self dealing.
ADVERSE DOMINATION
18. The relevant statutes of limitations on the counts asserted herein were tolled as a
result of Nance’s role as President and CEO of the Debtors.
ATTORNEY’S FEES
19. The Debtors request an award of his reasonable fees and costs pursuant to TEX.
BUS. & COM. CODE ANN. § 24.013 and other applicable law.

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REQUEST FOR PRE- AND POST-JUDGMENT INTEREST
20. The Debtors seek pre-judgment interest on the value of all transfers from the date
of transfer through the date of judgment at the rate of 6% per annum. The Debtors seek post-
judgment interest on all money damages awarded hereunder from the date of judgment until paid
at the prevailing federal judgment rate.
PRAYER
Accordingly, the Debtors request that the Court to enter judgment as set forth above and
to grant such other relief as is just.
By:/s/ Patricia B. Tomasco___________
Patricia B. Tomasco, Esq.
State Bar No. 01797600
MUNSCH HARDT KOPF & HARR, P.C.
600 Congress Avenue, Suite 2900
Austin, Texas 78701
(512) 391-6109
(512) 226-7103 (fax)
Email: ptomasco@munsch.com
ATTORNEYS FOR DEBTORS