Effex Capital sued the National Futures Association (NFA) for a press release that stated that the company had reached a settlement agreement with FXCM. Now, it has been given more time to decide whether it wants to file a petition for rehearing.
The FXCM exit issues continue
Effex was involved in the FXCM exit. The company and its CEO, Drew Niv always maintained that their customers were trading on no dealing desk platform. However, it failed to disclose that it an interest in the market maker and it was constantly dealing in the opposite positions that its retail customers dealt in.
Earlier this month, Effex lost an appeal in its NFA lawsuit at the Seventh Circuit US Court of Appeals. The company said that the NFA had invoked a case of defamation. It alleged that documents filed in the FXCM exit case contain defamatory material against the company. The District Court said that the Effex had not yet utilized all the administrative remedies against the NFA that were available. Therefore, its case could not be upheld. The Seventh Circuit Court issued Final Judgment and upheld the ruling of the District Court.
Effex will not give up
The company has decided not to give up in its legal pursuits. The company requested the court to get more time to take a decision on how it wants to proceed in the case. It highlighted than an extension is essential for the plaintiff-appellant to decide if, and to what extent, it wants to file a petition in this case again. The court granted this request and has now extended the timeline to September 17, 2019.
In its original motion, Effex was seeking injunctive relief and monetary damage of $10 million for loss in profits and redressal of constitutional injury.
It included an order that would require the NFA to either remove references to the company in all FXCM Settlement Documents. Alternatively, it could also hold a “name clearing hearing” which could highlight that the company was not a part of the FXCM process. It also wanted the NFA to remove all FXCM Settlement Documents from its website.
According to the petition, it wanted the NFA to “issue a new press release stating: (a) NFA did not make any findings against Effex or Dittami; (b) Effex was not a de facto dealing desk of FXCM; (c) Effex was not controlled by FXCM, and (d) FXCM was not ordered to make any customer restitution.”