FXCM explains lack of answer to complaint in a client lawsuit
The action brought by former client Vantalie Nguyen is about to be stayed with regard to Global Brokerage, FXCM Holdings, Forex Capital Markets LLC, Drew Niv and William Ahdout.
One of the questions concerning the legal action against Global Brokerage Inc (NASDAQ:GLBR), formerly known as FXCM Inc, following the events from February 2017, is the apparent lack of response by the broker and its principals to complaints in a number of such actions. In one of the cases, the one brought by a class of plaintiffs led by hedge fund 683 Capital Partners, we recently got an update, as FXCM’s attorneys are building a “mega” defense.
But there have been other cases against the broker, like the one brought by a group of former clients led by Vantalie Nguyen. In this particular action, FXCM, along with Drew Niv and William Ahdout, were supposed to file their answers by June 23, 2017.
Israel Dahan, who represents FXCM Inc., Forex Capital Markets, LLC, FXCM Holdings, LLC, Dror Niv, and William Ahdout (the so-called “FXCM Defendants”) in the case launched by Nguyen, has just filed a letter to the Judge assigned to the case, explaining the reason for the lack of reaction to the Plaintiffs’ Complaint.
The Letter, seen by FinanceFeeds, informs the court that the Plaintiff and the FXCM Defendants have been in negotiations. They will be jointly filing, very shortly, a stipulation to be so ordered by the Court staying the Action with respect to the FXCM Defendants. This is pending resolution of an individual arbitration proceeding Plaintiff intends to file against all or certain of the FXCM Defendants in line with the FXCM Client Agreement executed by Plaintiff.
Vantalie Nguyen has launched the case on behalf of former FXCM clients who traded on the “NDD” platform offered by the broker and claim to have suffered damages as a result of the broker’s undisclosed interest in Effex Capital.
On top of the “FXCM Defendants”, the case names Effex Capital and its CEO John Dittami among defendants too.
Mr Dittami and Effex Capital have recently been granted another time extension to respond to the complaint by the plaintiffs. They have until September 1, 2017 to file their answer.
One of the possible reasons for the extension request is that the counselors for Effex and its CEO would like to see the developments around another case – Effex Capital, LLC et al v. National Futures Association et al. The latter alleges that NFA revealed Effex’s trade secrets and caused harm to the company by posting the news release and complaint concerning FXCM and its alleged relations with Effex on February 6, 2017. Effex Capital and Dittami are now requesting that the Court directs NFA to remove and/or amend the materials involving Effex from its website.