DCG asks judge to consolidate class-action suits to avoid conflicting decisions

Venture capital firm Digital Currency Group (DCG) and its CEO Barry Silbert have called for the consolidation of two class-action lawsuits over alleged winter losses in cryptocurrencies.

In a letter sent to United States District Judge Stephen Underhill of Connecticut, the defendants said: claimed Both lawsuits “arise from the same facts, raise overlapping legal issues, and propose nearly identical class definitions.”

Defendants also argued that the cases should be consolidated to avoid conflicting rulings and to increase judicial efficiency. In the letter, the defendants told Underhill that they had asked U.S. District Judge Louis Lehman to move the case from New York to Connecticut. The letter read:

“This motion is expected to be fully explained by June 13, 2023 at the latest, and if Judge Lehman grants the motion for transfer to this court, the defendants will expedite to consolidate both cases. I am going to move.”

In the letter, Connecticut plaintiffs objected to the move, arguing that it was premature to make a decision before the New York lawsuit was approved for transfer. They also expect the New York plaintiffs to oppose the assignment because of the many uncertainties surrounding the nature and scope of the claims.

Related: Settlement between DCG and Genesis still pending after 30-day arbitration period

The Connecticut lawsuit alleges that Silbert engineered a misleading deal to hide signs of a $1.1 billion implosion after 3 Arrows Capital (3AC) began liquidation proceedings. Defendants face charges of securities fraud for making misleading or false statements.

Amid ongoing litigation, DCG has decided to close Prime Brokerage subsidiary TradeBlock. According to the company, the decision is due to the overall economic situation and the uncertain regulatory environment for cryptocurrencies in the United States. TradeBlock officially began the closing process on May 31st.

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