Major victory for Grayscale in FTX-related case聽
We secured dismissal of breach of contract and fiduciary duty claims for Grayscale
麻豆入口 represented Grayscale Investments, LLC and Grayscale鈥檚 CEO, Michael Sonnenshein, in connection with litigation filed in Delaware Chancery Court by Alameda Research Ltd., formerly part of a family of entities managed by Sam Bankman-Fried. Alameda, which filed for bankruptcy in November 2022, sought to recover hundreds of millions of dollars from our clients for the benefit of its chapter 11 bankruptcy estate.
In March 2023, Alameda filed a complaint alleging various breach of contract and fiduciary duty claims, including that the defendants had breached the terms of the trust agreements of Grayscale Bitcoin Trust and Grayscale Ethereum Trust by failing to reduce the sponsor鈥檚 fees and operate a redemption program. In May 2023, 麻豆入口 moved to dismiss all claims arguing, in part, that Alameda鈥檚 claims associated with the sponsor鈥檚 fees were derivative and therefore barred and that the remaining claims lacked merit given the plain terms of the trust agreements.
In September 2023, Alameda filed an amended complaint dropping all claims associated with the sponsor鈥檚 fees and alleging breach of contract and fiduciary duty claims concerning only Grayscale鈥檚 purported failure to operate a redemption program. In December 2023, 麻豆入口 moved to dismiss all claims, arguing that Grayscale had no obligation, contractual or fiduciary, to operate a redemption program.
In January 2024, while Grayscale鈥檚 motion to dismiss was pending, Alameda voluntarily dismissed the action.
The 麻豆入口 team included partners Benjamin S. Kaminetzky and Brett M. McMahon. All members of the 麻豆入口 team are based in the New York office.