Texas Judge Says 'Too Draconian' To Toss $63M Investor Suit

Law360 (November 12, 2019, 8:05 PM EST) -- A federal judge in Texas has trimmed a lawsuit brought by jilted creditors seeking to collect on a $63 million judgment against a real estate investment company, while holding that tossing the entire lawsuit would be “too draconian, unduly prejudicial to plaintiffs and unwarranted.”

U.S. District Judge Sam A. Lindsay issued an order on Friday that American Realty Investors Inc. and EQK Holdings Inc. — which have been accused by David M. Clapper and Michigan-based Atlantic Midwest LLC of fraudulently moving assets during bankruptcy so that ARI affiliate American Realty Trust Inc. would be unable to pay the judgment — won’t...

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