Key takeaways:
- U.S. Southern District Court dismisses class-action lawsuit against Tether and Bitfinex, confirms stablecoin issuer.
- Plaintiff chooses not to appeal after the judge denies motion to amend, states Tether.
Tether and Bitfinex have emerged victorious following Chief Judge Laura Taylor Swain’s decision to dismiss a class action lawsuit lodged by Shawn Dolifka against the stablecoin issuer and its sister company.
The legal triumph marked a significant milestone in the ongoing legal battle, underscoring the dismissal of what was deemed a baseless lawsuit.
The lawsuit accused Tether and Bitfinex of misleading consumers about the properties of Tether’s stablecoin USDT and disclosing false information regarding its reserves. Allegations suggested that the stablecoin was not backed 1:1 as claimed by the companies.
However, following the denial of Dolifka’s motion to amend the complaint, the plaintiffs opted against appealing the judgment, effectively concluding the legal dispute.
Despite this victory, the case remains open, as the judge granted the plaintiffs 30 days to file an amended complaint. The court emphasized that the plaintiffs failed to establish actual reliance on the alleged false statements, a crucial aspect for breach of contract and unjust enrichment claims.
The development stems from a previous lawsuit filed by U.S. citizens Matthew Anderson and Shawn Dolifka against Tether Holdings. The lawsuit accused the stablecoin issuer of providing misleading information about USDT reserves and deceiving consumers about Tether tokens’ properties. The recent dismissal stands as a testament to the legal defense mounted by Tether and Bitfinex against what they deemed as unwarranted litigation.
Tether’s statement highlighted Shawn Dolifka’s decision not to appeal the U.S. District Court for the Southern District of New York’s order, denying his motion to amend the class action complaint against Tether and Bitfinex.
The court’s judgment favored Tether and Bitfinex, deeming the dismissal final. Judge Swain’s ruling emphasized the complaint’s lack of “plausible allegations of injury,” as there was no evidence of USDT’s diminished actual value.
Despite the plaintiffs’ opportunity to amend, the revised arguments failed to rectify the complaint’s shortcomings, leading to its complete dismissal in September following Judge Swain’s rejection of the amended complaint.
