Lead Plaintiff Settles Class Action Targeting $20 Mln ICO for $250,000
In a continuation of ATBCoin’s class action lawsuit over its $20 million dollar Initial Coin Offering, or ICO, the lead plaintiff has filed to settle the case for 1.5% of the total raised.
While ATB Coin claimed that its blockchain would be the fastest in the world, ATB’s launch revealed that its technology could not out-perform other ledgers.
$20M ICO Suit to Settle for $250,000
In a motion for preliminary approval filed on April 10, the lead plaintiff in the suit, Raymond Balerta, has filed for a $250,000 settlement.
The lawsuit accused ATBCoin of failing to file a registration statement for its $20 million ICO with the U.S. Securities and Exchange Commission (SEC). Balestra filed the complaint in September 2017 on behalf of himself and the “thousands” of other investors he claims participated in ATB’s token sale.
The motion for preliminary approval of settlement states:
“Lead Plaintiff respectfully submits that the Settlement warrants preliminary approval because it is the result of vigorous arms-length negotiations by experienced counsel, representing a favorable recovery that falls well within the range of possible approval.”
Firm behind “fastest blockchain in the Milky Way” accused of exaggerating claims
The plaintiffs alleged that ATBCoin touted its platform as “the fastest cryptographic network in the Milky Way galaxy” and made other exaggerated marketing claims regarding the capabilities of its technology.
ATB is also accused of silently changing the price of its tokens on multiple occasions during the ICO — with the Plaintiffs claiming to have evidence that the company inflated ATB token prices from $1 in June 2017 to $1.50 two months later, then again lifting the price to $2.50 in September 2017.
In April 2019, ATB Coin was unsuccessful in an attempt to have the case rejected. U.S. District Judge, Vernon Broderick, then ruled that the complaint adequately showed the firm may have violated securities laws through its ICO, allowing the case to continue.
The markets for ATB’s token largely appear to be inactive. However, the ATB markets did produce a single trade on the controversial Russian crypto exchange, YoBit, at the start of April.
Tezos settles consolidated lawsuit
In March, Tezos (XTZ) moved to settle a $25 million consolidated lawsuit targeting its ICO, with the Tezos Foundation citing a desire to put the two-year legal battle to rest as the motivation underpinning the settlement.
“It was decided that the one-time financial cost of a settlement was preferable to the distractions and legal costs associated with continuing to fight in the courts,” the foundation stated.