01 January, 2020 | AtoZ Markets – The contradictory proceedings against AFX Capital Markets LTD, AFX Capital US Corp. and STO Super Trading Online set for further delay. The Eastern Bankruptcy Court in New York has decided on the case.
Another Adjournment Letter Filed with the US Court
On 30 December 2019, Chapter 11 Trustee Esther DuVal, administered estates of Gallant Capital Markets Ltd and Avenica Inc filed a letter with the US Court. It informed of another adjournment. In the adjournment letter, the parties consented to the following matters:
- The pre-trial conference.
- Motion to approve the stipulation regulating the contradictory procedure from 3 January 2020, at 10:00 am to 7 February 2020, at 10:00 am.
- Motion for judgment asks for sanctions and costs for having shown bad faith and for injunctive measures.
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Why is the AFX Facing Lawsuit?
During 2015 and 2016, Gallant Capital Markets deposited approximately $ 2.35 million (for its benefit) in a Gallant account maintained at AFX. During the two weeks preceding the commencement of Gallant's bankruptcy proceedings, there was a balance of approximately $ 2.4 million in Gallant's AFX account. Around this time, Gallant made multiple requests to the defendants for the rotation of Gallant's funds. And all requests ignored.
Nevertheless, AFX withdrew the outstanding balance, without authorization and foundation, on the date of filing. It was the violation of the automatic stay. This case deals with fundamental matters for which the trustee seeks to obtain the rotation of Gallant's property and the recovery of the assets of Gallant's estate.
The trustee also aims to achieve the execution of the automatic stay. Atozmarket reported on Nov 25 that the legal advisers of AFX group have filed for a withdrawal motion as the firm is unresponsive. And it has failed to pay outstanding invoices.
The latest adjournment of the proceedings comes after White and Williams LLP (WW) requested to withdraw as counsel for AFX. WW told that "irreconcilable differences have arisen" between the defendants and WW. In particular, WW repeatedly asked for AFX to pay the unpaid bills for legal services and expenses. But the defendants failed to pay WW the amounts due for representation in this matter.
AFX also did not respond to WW's requests for information and guidance in this matter. This includes not answering phone calls, emails and other WW correspondence.
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