Genesis parent company Digital Currency Group (DCG) and its CEO Barry Silbert have filed a motion asking the court to dismiss the lawsuit arising from the debt the crypto exchange Gemini says is owed to users of their Earn program.
Gemini Earn enabled customers to loan their crypto assets to institutional borrowers to earn interest, but Gemini heads say when Genesis became insolvent, it defaulted on $1.2 billion worth of assets that belong to 232,000 Earn users.
Gemini filed the suit last month claiming that DCG and Silbert fraudulently helped Genesis induce depositors to continue lending despite knowing that the firm suffered massive financial losses following the collapse of crypto hedge fund Three Arrows Capital.
“Defendants DCG and Silbert have aided and abetted Genesis in making fraudulent misrepresentations to Gemini with respect to Genesis’s financial condition and the support it received from DCG.”
On August 10th, the law firm Weil, Gotshal & Manges, which represents DCG and Silbert, submitted a court filing asking for the dismissal of the complaint.
“Defendants Digital Currency Group, Inc. and Barry Silbert, by and through their undersigned counsel, hereby move this Court before the Honorable Lewis J. Liman, at the United States Courthouse, 500 Pearl Street, New York, New York,1000, for an Order, pursuant to Federal Rules of Civil Procedure 8, 9(b), and 12(b)(6), dismissing with prejudice the Complaint in this action, and for any further relief that the Court may deem just and proper.”
The Winklevoss twins’ exchange wants to recover the damages and losses that it sustained from the alleged fraudulent acts of Genesis, DCG and Silbert.
“Defendants are jointly liable for one another’s tortious conduct directed towards Gemini and for Genesis’s tortious conduct directed toward Gemini.”
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