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- Judge Katherine Polk Failla of the United States District Court for the Southern District of New York released a 127-page ruling and order dismissing half of the plaintiffs’ claims against Tether and Bitfinex
- Bitfinex and Tether are looking forward to pursuing this lawsuit in court and will not settle any of the plaintiffs’ unfounded allegations
- The company allegedly manipulated the crypto market by releasing unbacked Tether in an effort to convey to the market that there was tremendous, organic demand for crypto commodities, according to the original complaint filed in October 2019
Judge Katherine Polk Failla of the United States District Court for the Southern District of New York released a 127-page ruling and order dismissing half of the plaintiffs’ claims against Tether and Bitfinex, including all of their RICO allegations, yesterday.
The plaintiffs’ original lawsuit was filed over two years ago, and the case is now in shambles. The Court’s order raises significant issues that will ultimately be fatal to the plaintiffs’ case, even for the remaining claims. This case is doomed, with half of their case dismissed, their primary expert debunked, and their lead law firm embroiled in its own internal feud, with partners and former partners trading allegations of fraud and ethics violations. Given the ruthlessness of the plaintiffs’ allegations, this is predictable.
Bitfinex and Tether are looking forward to pursuing this lawsuit in court and will not settle any of the plaintiffs’ unfounded allegations. Litigation will reveal this case for what it is: a sloppy money grab that irresponsibly damages the whole bitcoin ecosystem.
District Judge Katherine Polk Failla approved requests from Tether and Bitfinex’s parent company iFinex to reject crucial claims in the plaintiffs’ complaint alleging the two businesses manipulated the crypto market, according to court records released Tuesday in the Southern District of New York. Judge Failla allowed requests to dismiss five whole claims and a portion of one while refusing applications to dismiss six others.
The judge specifically said that investors would be barred from bringing claims against Tether and Bitfinex under the Racketeer Influenced and Corrupt Organizations Act, or RICO, as well as accusations of racketeering or the use of racketeering funds for investments. Investors in Tether and Bifinex could not inadequately assert the businesses’ monopolistic power in the stablecoin market, she added.
The lawsuit is doomed, Tether wrote on his blog on Wednesday. Even for the remaining claims, the Court’s ruling raises significant problems that, in the end, will be fatal to the plaintiffs’ case. The company went on to say that the litigation will reveal this case for what it is: a sloppy money grab that irresponsibly damages the whole bitcoin ecosystem.
The company allegedly manipulated the crypto market by releasing unbacked Tether in an effort to convey to the market that there was tremendous, organic demand for crypto commodities, according to the original complaint filed in October 2019.
The plaintiffs claim that the business intended to artificially inflate the price of cryptocurrencies such as Bitcoin (BTC) in order to create and perpetuate a ‘bubble’ in the crypto commodity market. While Bitfinex and Tether reached a settlement with the New York Attorney General’s Office in February over the misuse of USDT reserve money, the civil lawsuit with a group of unhappy crypto investors is still ongoing. In the first lawsuit, Bitfinex and Tether agreed to pay $18.5 million in penalties to New York and to declare their reserves on a regular basis, as well as to stop serving customers in the state.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
