Lead Plaintiff Settles Class Action Targeting $20 Mln ICO for $250,000

Published at: April 12, 2020

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.

Tags
Altcoin
Security
Ico
Atb Coin
Related Posts
Powers On... Why the fear of ICO enforcement and liability is coming to an end
Powers On... is a monthly opinion column from Marc Powers, who spent much of his 40-year legal career working with complex securities-related cases in the United States after a stint with the SEC. He is now an adjunct professor at Florida International University College of Law, where he teaches a course on “Blockchain, Crypto and Regulatory Considerations.” Well, well, well. It seems that some of those class-action law firms that ferret out possible securities claims in search of fees and recovery for investors, sometimes wrapped self-righteously in the flag of investor harm and rights, are properly receiving a cold shoulder …
Regulation / July 27, 2021
Kik’s Drama With the SEC May Soon Be at an End
A new round of documents have been filed in the lengthy dispute between the United States Securities and Exchange Commission, or SEC, and Kik Interactive Inc. over the messaging company’s 2017 initial coin offering, or ICO. Both parties are seeking summary judgment, with the SEC submitting a proposed order that it hopes the court will sign. However, Kik is confident that the judge will rule in its favor, asserting that the SEC’s argument rests heavily on construing the Telegram case as precedent. SEC proposes summary judgment order The SEC filed a proposed order on May 8 outlining its request for …
Regulation / May 9, 2020
Ripple Files Final Motion to Dismiss Class-Action Securities Lawsuit
Ripple has filed a motion to dismiss a class-action lawsuit alleging that it held an unregistered securities sale of its XRP tokens. In court documents filed on Dec. 4, Ripple argues that the plaintiffs’ case is contradictory and “self-defeating.” Alongside a reiteration of previous arguments, the company now also claims that, even if XRP were a security, the statute of repose had passed before the lawsuit was brought to court. Ripple says that XRP is not a security, but even if it were... In what is reportedly Ripple’s last attempt to get the case thrown out before the scheduled hearing …
United States / Dec. 6, 2019
Ex-ConsenSys Exec Joins Security Token Project Dusk Network
Former blockchain firm ConsenSys’ ventures head Kavita Gupta joined security token project Dusk Network. As industry news outlet The Block reported on Aug. 30, Gupta joined Dusk Network, an Amsterdam-based startup trying to help companies tokenize their equity shares. Dusk Network co-founder Mels Dees claims that the company is also working with a regulated European stock exchange and have partnered with a major cryptocurrency exchange. Fundraising for private companies Gupta, who worked at McKinsey, HSBC and the World Bank, believes that security token offerings (STOs) can address various impediments that keep private companies from tapping into public markets. Per the …
Altcoin / Aug. 31, 2019
‘Operation Cryptosweep’ Results in 200 Crypto-Related Investigations
The North American Securities Administrators Association (NASAA) announced today, August 28, that its ongoing initiative “Operation Cryptosweep” has resulted in over 200 investigations of Initial Coin Offerings (ICOs) and crypto-related investment products. State and provincial securities regulators in the U.S. and Canada launched probes into potentially fraudulent crypto investment programs as part of the NASAA’s “Operation Cryptosweep” in May. The initiative targeting suspicious crypto investment products is reportedly the largest such coordinated investigation by state and provincial officials. The NASAA President and Alabama Securities Commission Director Joseph P. Borg said that in the course of their investigations, regulators have come …
United States / Aug. 28, 2018