Venture capital firm Digital Currency Group (DCG) and its CEO Barry Silbert have asked to consolidate two class-action lawsuits alleged losses during the cryptocurrency winter.
In a letter to US District Judge Stefan Underhill for Connecticut, the defenders argued that the two cases "arise from the same facts, have overlapping legal issues, and raise nearly identical class definitions."
Defendants also argued that joining cases was necessary to avoid conflicting decisions and to enhance judicial efficiency. In the letter, the defenders informed Underhill they had asked US District Judge Lewis Liman to transfer the case from New York to Connecticut. The letter read s: "The motion will be fully introduced by June 13, 2023, and if Judge Liman grants the motion to transfer to this court, the defenders intend to move expeditiously to consolidate the two actions."
In the letter, the Connecticut plaintiffs disputed the move, arguing that it was too early to make a decision before the New York case was approved for transfer. They also expect the plaintiffs in New York to oppose the assignment because there is a lot of uncertainty about the nature and scope of the claims. The Connecticut lawsuit charges that Silbert engineered a misleading deal to hide signs of a $1.1 billion implosion after Three Arrows Capital (3AC) initiated liquidation proceedings. Defendants face securities fraud charges for m aking misleading or false statements.
Amid ongoing litigation, DCG has decided to shut down its lead brokerage subsidiary, TradeBlock. According to the company, the decision stems from uncertainty about broader economic conditions and the regulatory environment for cryptocurrencies in the United States. TradeBlock officially began the shutdown process on May 31.
