ATM manufacturer Tranax Technologies Inc. earlier this month filed for Chapter 7 voluntary bankruptcy protection, citing debts of between $1 million to $10 million.
The June 11 bankruptcy filing came just two weeks after a federal judge in California ordered Tranax to pay rival Nautilus Hyosung Inc. $5 million plus more than $1,000 per day in interest stemming from a dispute between two former partners (
Nautilis is among the 13 creditors listed in the filing obtained by PaymentsSource.
Won Gee Lee, Tranex president and CEO, wrote in the filing it was in the company’s “best interest” to file a voluntary petition in the U.S. Bankruptcy Court.
Lee also wrote that he alone “is authorized and directed to execute and deliver all documents necessary to perfect the filing of a Chapter 7 voluntary bankruptcy case on behalf of the corporation.”
The dispute between Tranax and Nautilus stems from an agreement between the two companies that went bad. From 1998 to January 2007, Tranax was Nautilus’ sole distributor of ATMs in the U.S. and Canada.
But in 2006, Nautilus discovered Tranax substituted another manufacturer’s cash dispenser into Nautilus ATMs without permission. Nautilus suspended ATM shipments to Tranax, and Tranax responded by withholding payments of outstanding invoices, according to Nautilus officials.
Nautilus then directly entered the Canadian and U.S. retail ATM market.
In February, the American Arbitration Association ruled in Nautilus’ favor for its claims against Tranax. The judge’s ruling confirmed the association’s decision.
The association also is listed as creditor, as IS the Internal Revenue Service.
Tranax sells ATMs to independent sales organizations.
