The United States’ Delaware Court of Chancery has granted a motion from Galaxy Digital, a crypto investment company, to largely dismiss the case brought forth by digital asset custodian BitGo after the former’s acquisition of the latter was dropped in 2022.
According to court documents filed on June 9, Vice Chancellor J. Travis Laster ruled that BitGo’s complaint against Galaxy Digital should be fully dismissed. This came after Galaxy abandoned its plan to buy BitGo in August 2022 as part of a $1.2-billion agreement, claiming a breach of contract. Subsequently, BitGo initiated a legal action against Galaxy seeking $100 million in compensation.
In his judgement, Laster declared that Galaxy had a legitimate right to end the purchase of BitGo due to the latter’s inability to present certain financial records in its attempt to be listed in the U.S. stock market. A spokesperson for Galaxy expressed satisfaction with the court’s decision to reject BitGo’s claims.
Laster declared, “Nothing has been asserted that would lead one to believe that the exercise of the termination right was in violation of the implied covenant of good faith and fair dealing.”
Galaxy Digital turns to profit after incurring a net loss of $1 billion in 2022.
In May 2021, Galaxy Digital, operated by Mike Novogratz, revealed its plan to get BitGo as part of its public offering in the United States. Unfortunately, the BitGo deal did not materialize in 2022 and the company revealed it had $77 million at stake in the failed crypto exchange FTX, which declared bankruptcy in November.
It is uncertain what legal options BitGo may have in the aftermath of the ruling from the Delaware court. Cointelegraph contacted BitGo’s legal representative but did not receive a reply at the time of writing.
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