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AFX Capital settlement hearing postponed

Amandeep Sonewane | Jun. 11, 2019
AFX Capital settlement hearing postponed

June 11, 2019, | AtoZ MarketsThe hearing which was committed to the proposed settlement between AFX Capital and the Chapter 11 Trustee of Gallant Capital Markets Ltd is now set to be postponed to July 2, 2019. Till date, nothing seems to be happening after the lawsuit brought by the Chapter 11 Trustee of Gallant Capital Markets Ltd. against AFX Capital Markets Ltd., AFX Capital U.S. Corp., and STO Super Trading Online.

AFX Capital settlement hearing postponed for next month

Another delay from the court regarding the case between these parties has been seen. The hearing was originally scheduled for June 11, 2019, which is now shifted to July 2, 2019, according to the letter filed with the New York Eastern Bankruptcy Court. 

The reason for the delay is not yet confirmed, and the text states that: “This letter is to confirm the adjournment of the pre-trial conference in the above- mentioned adversary proceeding and the motion to approve the Trustee’s Stipulation with the Defendants, on consent of Defendants’ counsel, from Tuesday, June 11, 2019 at 10:00 a.m., to Tuesday, July 2, 2019 at 9:30 a.m”.

According to the source, bankruptcy trustee of Gallant Capital Markets and AFX previously reached a settlement where the defendant will pay $83,000 as the full and final payment for any claims. The trustee has accepted it as a fair settlement on part of AFX.

What is going on with AFX Capital case?

According to the complaint, Gallant deposited about $2.35 million with AFX throughout 2015 and 2016 for its benefit. The account where the money was deposited was being maintained by AFX. Two weeks before Gallant started its bankruptcy case, the AFX account had a balance of $2.4 million. During this time, Gallant made several requests to AFX to turnover its funds. However, the defendant disregarded the requests.

AFX went on to withdraw the remaining balance without basis and without authorization on the Filing. Their actions violated the automatic stay. The Gallant trustee sought turnover of Gallant property as the recovery of assets of their estate. They also seek automatic stay enforcement.

The documents filed with the New York Eastern Bankruptcy Court today show that the parties are moving towards a resolution. Both the parties propose that a hearing shall be held on June 11, 2019, at 10 am or as soon thereafter before the Honorable Elizbeth S. Stong, United States Bankruptcy Judge, Eastern District of New York. The hearing will be on the motion of the Chapter 11 Trustee of the Gallant Capital Markets Ltd. and Avenica Inc., Esther DuVal.

DuVal will appear solely in her capacity as the bankruptcy trustee of the two jointly administered estate of debtors. The hearing shall seek entry of an Order that approves the stipulation between the two parties that will resolve the case proceedings. Objections to the relief request must be filed with the court before June 4 at 5 pm.

After months of negotiations, the parties have agreed that the defendants will pay a sum of $830,000 in full and final settlement of any and all claims of the trustee and debtors’ estates. The settlement sum will be paid to the trustee. DuVal also believes that it is a fair and reasonable settlement on part of AFX and is ready to accept the amount.

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Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.