The Delaware US Chancery Court has accepted a motion by cryptocurrency investment firm Galaxy Digital largely dismissing the case of digital asset custodian BitGo following a scrapped acquisition of the firm in 2022.
According to court documents filed on June 9, Vice Chancellor J. Travis Laster dismissed BitGo’s lawsuit against Galaxy Digital with prejudice.. The decision came after Galaxy abandoned its decision to acquire BitGo in August 2022 as part of a $1.2 billion deal after extensive negotiations, citing a breach of contract. BitGo subsequently filed a lawsuit against Galaxy seeking $100 million in damages.
In his ruling, Laster said Galaxy had a “clean termination right” to the BitGo acquisition based in part on BitGo’s failure to provide certain financial statements in its efforts to go public in the United States. A Galaxy spokesperson told Cointelegraph that the company was “satisfied” with the court’s decision to dismiss BitGo’s claims.
“There are no facts alleged that would make it reasonably conceivable that the exercise of the right of termination would be inconsistent with the implied covenant of good faith and fair dealing,” Laster said.
We’re pleased with the court’s decision to dismiss BitGo’s claims. Now is the time for all of us to work together and focus on the task at hand: Upgrading the global financial system in a way that promotes innovation and protects investors and consumers alike. pic.twitter.com/xPrMP8AghW
—Galaxy (@galaxyhq) June 12, 2023
We are pleased with the court’s decision to dismiss BitGo’s claims. Now is the time for all of us to work together and focus on the task at hand: Modernizing the global financial system in ways that promote innovation and protect both investors and consumers.
Operated by Mike Novogratz, Galaxy Digital announced its intention to acquire BitGo in May 2021 as part of its public offering in the United States. However, andn 2022 the BitGo deal fell apart, and the firm disclosed a $77 million exposure to failed cryptocurrency exchange FTX, which filed for bankruptcy in November.
It is unclear what legal recourse BitGo may have following the Delaware court decision. Cointelegraph reached out to BitGo’s legal counsel, but did not hear back at press time.
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