Bibox beats lawsuit alleging unregistered securities issuance
A U.S. district has rejected a lawsuit alleging that Bibox sold unregistered securities because the lead plaintiff last traded the tokens in question more than 12 months ago.
A lawsuit accusing crypto exchange Bibox of selling six unregistered securities was thrown out of a U.S. District Court after Judge Denise Cote ruled the plaintiff had failed to file the complaint within 12 months of trading the tokens.
Plaintiff Alexander Clifford filed the class-action complaint on June 3, 2020, seeking to recover investments he previously made into Bibox’s native BIX token, in addition to Eos (EOS), Tron (TRX), Aave (LEND), and Aelf (ELF) on behalf of other investors.
The lawsuit alleged that Bibox had selectively withheld information from investors to conceal that the tokens comprised unregistered securities while facilitating trade in the assets during October 2017. The lawsuit emphasized Bibox’s apparent failure to register its BIX token with regulators.
However, the case was tossed out with relative ease on April 16, with the judge noting that Clifford’s final BIX transaction was conducted around December 2018 — outside of the 12-month deadline for securities claims.
“Plaintiff’s claims regarding BIX are dismissed as barred by the statute of limitations,” Judge Cote said.
The judge also noted that the lead plaintiff lacked standing on the claims against the other five tokens as Clifford had only traded BIX and failed to show how other class members had any injury caused by the sale of the other tokens.
“The plaintiff has not alleged that he suffered any actual injury from the conduct of the defendants regarding the five tokens he did not purchase.”
The initial lawsuit was filed amid a wave of complaints filed from law firm Roche Freedman in 2020, with the firm alleging securities violations on the part of the several top crypto exchanges and token issuers, including KuCoin, Block.One, and Tron Foundation.
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Author: Brian Quarmby