WEST PALM BEACH – The U.S. District Court for the Southern District of Florida recently denied motions for summary judgment filed by all parties in Freestream Aircraft USA's suit alleging Atlas Aviation and other named defendants stole money from Freestream.
U.S. Magistrate Judge William Matthewman, who wrote the May 31 court order, denied the motions for summary judgment and assigned a date for trial by jury.
Freestream President Rebecca Posoli-Cilli filed suit against Ronni Chowdry, Atlas Aviation, Atlas Aviation Sales & Leasing LLC and Atlas Luxury Jets LLC in 2014 to recover over $1 million that Chowdry allegedly spent on personal and business items. Chowdry is the sole or controlling shareholder in the three Atlas companies, the court documents said.
The court document said money Chowdry allegedly spent was part of an almost $3 million referral fee Posoli-Cilli had transferred into Atlas Aviation’s account. Posoli-Cilli had earned the fee from Tyrus Winds Ltd. for her role in the sale of aircraft.
"Chowdry volunteered to accept plaintiffs referral fee into Atlas Aviation's bank account and make transfers in accord with plaintiff s instructions," court documents said.
The court document said that within a week, Chowdry had transferred all the money to the Atlas Sales account, and six months later, had spent all the money. The document also said bank records show Chowdry took out $70,000 in cash withdrawals and couldn’t provide information on where that money went and wrote checks from the account to cover personal expenses.
After attempting to get her money back multiple times, Posoli-Cilli hired a lawyer, who spoke with Chowdry and Chowdry’s lawyer, S. Steven Karalekas, who stated the money wasn’t available yet, but made multiple promises to pay it back, the court filing said. Chowdry’s companies all have the same address, and no employees or other assets. Atlas Sales closed in 2016, and Atlas Luxury was formed in 2016.
Posoli-Cilli made a formal demand for the funds in January 2016, and both parties then filed for summary judgment in the suit.
Posoli-Cilli requested injunctive relief for harm suffered, to pierce the corporate veil, and damages. Posoli-Cilli also requested an injunction “to protect the public interest and prevent defendants from committing fraud against Freestream and others.”
Posoli-Cilli claims that Chowdry converted her money as she never agreed for Chowdry to use the funds for business or personal use, or an oral express agreement.
Chowdry argues that Posoli-Cilli agreed to Chowdry, Atlas Aviation, and Atlas Sales’ use of the funds and that they had an express oral agreement. Chowdry contends that Posoli-Cilli “has failed to establish that the money at issue is identifiable,” claiming that the plaintiff never asked for the funds to be segregated.
Judge Matthewman said, “The undisputed facts do not establish that the parties had an agreement or that plaintiff’s failure to explicitly request that the funds be held in a segregated account is fatal to its claims.”
Matthewman noted that the plaintiff’s undisputed facts did not establish conversion, that Atlas Luxury was created and used for “improper or fraudulent purposes,” and as such “the court cannot find that the undisputed material facts establish civil theft.”
The order denied summary judgment to both parties, and a trial by jury is set for June 28.
United States District Court Southern District of Florida, Case Number 9:16-cv-81232-WM