Interpretation and Summary of Court Order in the Bankruptcy Proceedings Against T1 Payments

T1 Payments with Donald Kasdon and Amber Fairchild with Pixxles
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U.S. high-risk payment processor T1 Payments was once the partner for ING‘s now-closed Payvision subsidiary. T1 Payments faced numerous lawsuits from merchants alleging fraud and fled into bankruptcy in January 2023. The payment processor was run by Donald Kasdon, his mother Debra Karen King aka Debra Karen Kasdon and his fiance Amber Fairchild. The later founded the FCA-regulated e-Money Institution Pixxles Ltd.

In an interesting Court Order, you can see that the creditors of T1 Payments and Donald Kasdon and his family are proceeding. They feel cheated and want their money back. The court order contains valueable information about the way T1 Payments did business with its clients.

T1 Payments Bankruptcy Background:

T1 Payments, LLC filed a ‘skeleton’ voluntary petition for bankruptcy under Chapter 7 on January 30, 2023. Subsequent filings revealed the company’s various assets, liabilities, and financial affairs. Notably, the company owned a 2019 Porsche Turbo S vehicle valued initially at $175,000 and later adjusted to $127,000. The company’s total property value was adjusted from $560,183.65 to $512,183.65.

The Motion:

New U Life Corporation (NULC), one of the merchants and a creditor, brought forward a motion to modify the automatic stay, essentially requesting the court to allow them to proceed with a lawsuit from 2019 against T1 Payments without enforcing any judgment. The basis of NULC‘s claim against T1 Payments was a federal lawsuit for fraud and theft of payment processing funds.

Multiple parties, including the Trustee overseeing T1 Payment‘s bankruptcy, opposed the motion. These parties contended that proceeding with the lawsuit against T1 Payments would be unnecessary and inappropriate, especially since NULC‘s claim was already deemed allowed by the bankruptcy process.

Court’s Discussion and Decision:

The court discussed the following major points:

  1. Relief from Stay against T1 Payments:
    • NULC‘s argument for relief from the automatic stay was to seek a judgment against T1 Payments and to continue its counterclaim against non-debtor parties.
    • The court found no reason to grant relief, noting that NULC‘s claim was already deemed allowed, making the pursuit of the 2019 lawsuit redundant.
  2. Relief from Stay against Non-Debtors:
    • The court noted that the automatic stay only applies to the bankruptcy debtor, its property, and property of the bankruptcy estate. Thus, the stay doesn’t apply to NULC‘s independent claims against non-debtor parties, making relief unnecessary.
  3. Comfort Order:
    • NULC sought a “comfort order” under Section 362(j), confirming that they could proceed against non-debtor defendants.
    • The court ruled Section 362(j) inapplicable in this context, and thus denied the comfort order request.


The court denied NULC‘s motion to modify the automatic stay for judgment only and the request for a comfort order. The judgment essentially upheld the sanctity of the bankruptcy process, ensuring that once a claim is recognized and allowed within bankruptcy, external lawsuits on the same matter are unnecessary and redundant.In layman’s terms, the court order signifies the importance of the bankruptcy process in ensuring that claims against a bankrupt entity are handled within the confines of that process, rather than through external litigation.

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