Delaware Supreme Court Overturns Dismissal of BitGo's $100M Lawsuit against Galaxy Digital
Summary:
In a recent turn of events, the Supreme Court in Delaware overturned a lower court dismissal of a $100 million lawsuit by BitGo against Galaxy Digital over a cancelled merger agreement. The top court found ambiguity in the contract language, allowing BitGo another chance to press charges. Galaxy had previously ended the $1.2 billion merger deal, citing BitGo's failure to produce audited financial statements from 2021.
The State Supreme Court of Delaware has overturned a previous court decision, which threw out a $100 million lawsuit filed by BitGo against Galaxy Digital following a botched acquisition. A May 22 filing by the state's top court noted an unclear language in the $1.2 billion merger agreement between BitGo and Galaxy Digital – an agreement that was terminated by Galaxy in August 2022. The state supreme court thus decided to reverse the initial verdict of the Delaware Chancery Court, suggesting the need to weigh other pertinent evidence to clarify the contract's vagueness.
The approved appeal, initially lodged on Feb. 7, might give BitGo another chance to sue Galaxy Digital. In a lawsuit from August 2022, BitGo accused Galaxy of deliberately infringing the purchase contract. Galaxy maintained that it legally entitled to end the deal after BitGo did not provide audited financial reports from 2021.
R. Brian Timmons, a representative from law firm Quinn Emanuel that is acting for BitGo, spoke with Cointelegraph about the recent court decision: "We believe that justice has carried the day in the appeal, and look forward to proceeding with this case in the Chancery Court," he said.
Related: Following a lost lawsuit against Galaxy, BitGo accumulates $100M.
In June 2023, the Delaware Chancery Court discarded BitGo's suit on the grounds of prejudice. The Vice Chancellor, J. Travis Laster, stated that Galaxy rightfully backed out of the BitGo acquisition at that period. Galaxy Digital did not respond to Cointelegraph's request for a statement at press time.
Mike Novogratz directs Galaxy, which announced plans to purchase BitGo as part of its US public offering in May 2021. While the cryptocurrency exchange FTX was failing in November 2022, Galaxy reported nearly $77 million in at-risk exposure to the firm prior to FTX's bankruptcy declaration.
Published At
5/25/2024 1:00:11 AM
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