Judge Has Refused to Consolidate FTX Class-action Cases

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Last Updated on March 9, 2023 by Bitfinsider

A federal court has declined to consolidate several planned class-action lawsuits filed by investors against the FTX exchange.

United States District Judge Jacqueline Scott Corley issued an order on March 8 denying plaintiffs’ desire to consolidate five planned class-action cases against the bankrupt cryptocurrency exchange. Despite the fact that no defendants objected to the petition, the judge noted that not all defendants had yet had the chance to reply.

Plaintiffs, including Julie Papadakis, Michael Elliott Jessup, Stephen Pierce, Elliott Lam, and Russell Hawkins, filed lawsuits in California accusing former FTX CEO Sam Bankman-Fried and other officials of asset misappropriation. While all of the claimants are targeting Bankman-Fried, the suits also name a number of other defendants, such as outside auditors and those pushing the exchange.

As a result, the court stated that there is no need to combine before hearing the defendants’ side. “The Court discerns no need to do so now without providing Defendants the chance to be heard. And appointing temporary class counsel prior to consolidation would be premature,” the ruling stated.

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