Additionally within the movement, CrossCountry’s attorneys say the corporate paid Gallo a $2.1 million sign-on bonus in 2023 with a contractual settlement requiring reimbursement if he left the corporate inside 36 months.
Gallo, who faces federal mortgage fraud fees, beforehand labored for NJ Lenders Corp., the place he was a prime producer. He and his assistant, Mehmet A. Elmas, were charged by the Division of Justice (DOJ) in April 2024 for falsifying mortgage paperwork from 2018 by means of late 2023.
In October 2024, Gallo and Elmas were indicted by a federal grand jury on one depend of conspiracy to commit financial institution fraud, eight counts of financial institution fraud, eight counts of false statements to a monetary establishment and one depend of aggravated identification theft.
On account of Gallo’s legal fees, he was terminated by CrossCountry earlier than the 36-month interval.
“The termination was premised completely on the presence of the allegations of fraud and Mr. Gallo’s indeniable arrest and legal criticism towards him,” CrossCountry’s submitting states.
In consequence, CrossCountry despatched Gallo a letter demanding reimbursement of the sign-on bonus, which he has reportedly not complied with. CrossCountry filed for arbitration with the AAA to get well the funds and argues that the court docket lacked authority to remain the arbitration.
CrossCountry informed HousingWire it doesn’t touch upon authorized issues.
In an emailed assertion, Gallo’s legal professional, Michael S. Weinstein of Cole Schotz, referred to as the submitting “unlucky.”
“It’s unlucky that CCM filed its latest Intervention pleading searching for to undo what a Federal Choose has mentioned was an affordable pause within the outdoors arbitration demand filed by CCM towards Mr. Gallo,” Weinstein wrote.
“CCM’s Intervention submitting is exclusive, and disfavored. Different Courts who, when analyzing such a problem have dominated for a defendant and permitted him, rightly, to give attention to the legal proceedings as precedence primary. Mr. Gallo can be submitting a robust opposition this week.
“CCM waited 18 months to pursue potential claims towards Mr. Gallo so the push now to get that transferring makes little sense,” he added. “CCM additionally appears to recommend {that a} defendant’s Constitutional Rights aren’t as vital because the strictly monetary declare they search. I believe they may discover Federal Judges suppose fairly in another way.”
Gallo and the U.S. authorities collectively requested the court docket to dam the arbitration, in accordance with the submitting. CrossCountry claims it was not copied on the letter and “was thus given no alternative to reply or object to the requested keep.”
CrossCountry argues the dispute is just about reimbursement of a bonus, not the legal case, and will proceed below an settlement specifying arbitration in Ohio, the place the corporate is headquartered.
If the movement succeeds, CrossCountry might transfer forward with its $2.1 million bonus declare. If the keep stays, arbitration could be delayed till the legal case wraps up, doubtlessly pushing decision into 2026.
