An FTX creditor trust has dropped its legal effort to recover $1.15 billion from Genesis Digital Assets Ltd., the Bitcoin mining company named in a lawsuit linked to transfers from FTX co-founder Sam Bankman-Fried. According to a filing in the U.S. Bankruptcy Court for the District of Delaware dated Monday, the trust dismissed all claims with prejudice.
The suit had accused Genesis Digital, its affiliates and co-founders of receiving commingled and misappropriated funds from Bankman-Fried during the period from August 2021 through April 2022. The complaint also alleged that Bankman-Fried used his personal hedge fund, Alameda Research LLC, to purchase several tranches of shares in Genesis Digital at what the trust described as heavily inflated prices.
Genesis Digital, which is registered in Cyprus and maintains its headquarters in Dubai, moved to dismiss the case in January. In its motion, the company argued that it should not be required to defend claims in a U.S. bankruptcy proceeding when it does not have offices in the United States, among other legal arguments set out in the dismissal motion.
The bankruptcy court filing confirms that the trust elected to end its claims against Genesis Digital and related parties by filing a dismissal that resolves the asserted causes of action with prejudice. By dismissing with prejudice, the trust has foreclosed the option to refile the same claims against these defendants in the future under the same theory.
The complaint, as filed by the trust, had focused on alleged transfers and equity purchases tied to the period between August 2021 and April 2022 and identified Alameda Research LLC as the vehicle through which certain share purchases in Genesis were made. The filing and the prior motion to dismiss outline the competing legal positions: the trust asserting recovery rights on behalf of FTX creditors, and Genesis challenging the court s jurisdiction and other bases for the claims.
No additional factual or legal developments are contained in the filing beyond the trust s dismissal of the claims with prejudice and the previously noted jurisdictional arguments by Genesis Digital.