An affiliate of Japan’s NYK Group has secured orders allowing it to seize assets of a Delta Corp Holdings unit over allegations that it breached a charter contract.
The orders came after NYK Bulk & Projects Carriers filed a lawsuit in US federal courts in Delaware and California seeking to seize $1.05m over its dispute with Singapore-registered, UK-headquartered Delta Corp Shipping.
And they emerged just days after Delta Corp Holdings announced a renewed bid to secure a US listing.
In Delaware, US district judge Colm Connolly approved a writ of garnishment against a US-based unit under the Delta umbrella, Delta Corp Logistics USA.
US magistrate judge Steve Kim, of the US District Court for the Central District of California, has issued a similar order to garnish the same amount of Delta Corp Shipping assets held at Oversea-Chinese Banking.
NYK’s lawyers have accused Delta of failing to pay for the charter of the 58,400-dwt Iron Duke (built 2011), which is owned by the UK’s RB British Marine, according to a complaint filed with the US District Court for the District of Delaware.
A source with knowledge of the situation said the sides are locked in an arbitration dispute in London over the charter, which is common in US maritime asset seizure cases.
It is not known whether NYK has been successful in seizing any assets.
When contacted by TradeWinds, Delta Corp Holdings chairman Peter Shaerf referred questions to chief executive Mudit Paliwal, who has yet to respond. The company has not yet filed its response with the court.
According to court records, Delta Corp chartered the Iron Duke in May from NYK Bulk to carry iron ore from Liberia to Germany.
NYK’s lawyers alleged that after Delta delivered the bulker at the end of the charter, it failed to pay nearly $603,000 in charges due.
They said that Delta said it would pay $594,000, but that payment never came.
The Delaware lawsuit was filed on 19 September by Stephen Simms of Baltimore law firm Simms Showers and Timothy Houseal of Young, Conaway, Stargatt & Taylor, court records show.
Simms filed the California case a day earlier with help from Neil Klein and Maria del Rocio Ashby of Irvine-based McKasson & Klein
Shortly after the cases were filed, Delta Corp Holdings announced that it agreed to a reverse merger with Kaival Brands Innovations Group, a vaping company, with shares on the Nasdaq stock market.
With 16 offices worldwide, the logistics conglomerate is involved in three main business lines: a bulk logistics unit moving 1m tonnes of cargo per month; an energy logistics arm focused on marine fuels and lubricants; and an asset management division involved in offshore energy and maritime markets.
It also boasts several technology platforms.
Delta Corp Holdings’ 2023 balance sheet included $10m in cash on hand out of $176m in total assets, as well as $28.6m in borrowings out of $103m in total liabilities, according to a presentation filed in association with the reverse merger.
