The decentralized finance (DeFi) community received good news yesterday after the 2-year-long lawsuit against the DeFi protocol PoolTogether finally came to an end. PoolTogether’s co-founder, Leighton Cusack, excitedly shared the update on Twitter, saying the court has dismissed the case.

US federal judge Frederic Block dismissed the lawsuit filed by Joseph Kent against the DeFi Startup in October 2022. 

Why Judge Dismissed Lawsuit Against DeFi Startup

The former head of tech for Senator Elizabeth Warren’s presidential campaign, Joseph Kent, filed a reformed class action lawsuit against PoolTogther Inc. The plaintiff sued the firm for severe damages after depositing $12 worth of stablecoins into the protocol. 

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He leveraged the New York law that allows buyers of an illegal lottery ticket to file class-action lawsuits against the ticket issuer.

Kent claimed that PoolTogether runs an illegal lottery and casino in New York and may never deliver touted value since it withholds 50% of weekly wins as reserves. He sought compensation of double the amount he spent on PoolTogther’s lottery tickets and twice the amount of attorney fees and legal costs. However, Judge Block disagreed with Kent’s argument. 

Notably, the defense team argued that Kent suffered no loss by depositing his funds on PoolTogether’s platform. The lawyers said the software engineer deposited the money to qualify him to sue the protocol.

Fortunately for the defense team, the judge ruled in their favor. Although Judge Block doubts PoolTogether’s legality, he suggested the matter should appear before a state court. According to the judge, the firm’s legality can only be decided at a state court since there is no evidence of wrongdoing at the federal level.

Judge Block said in the Go to Source to See Full Article
Author: Kent Glory

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