New York Court Grants Bitfinex’s Motion to Modify Injunction, Tether Can Use Reserves Again
New York Supreme Court judge Joel M. Cohen granted Bitfinex’s motion to modify the order received by the New York Attorney General against their business. This is because the first order was vague, overbroad, and not time-limited.
NY court grants Bitfinex's motion to modify injunction: https://t.co/b8TY0QBvYs
— Bitfinex (@bitfinex) May 16, 2019
According to the press release by Bitfinex:
“The court’s order allows Bitfinex and Tether to continue their normal business activities. It also stipulates that the injunction will expire in 90 days and that the burden to seek any renewal from the court rests squarely on the shoulders of the New York Attorney General’s office, where it belongs. Judge Cohen held that New York’s Martin Act does not provide a roving mandate to regulate commercial activity. This order is a victory in the ongoing defense of our business against the New York Attorney General’s office.”
The Story So Far
The case began last month, when the NYAG secured a preliminary injunction, alleging Bitfinex covered up the loss of $850 million by borrowing from Tether’s reserve. The companies have overlapping management and owners. A New York State Supreme Court judge ordered the two parties to clarify the order last week. the attorneys for each side failed to come to a consensus on what, precisely, Tether should be allowed to do with its holdings.
The NYAG’s office wants to prevent “any affiliated entity” from touching funds in Tether’s reserve and a 90-day injunction. On the other hand, attorneys for Tether and iFinex, the parent firm of Bitfinex, want a 45-day injunction and for affiliated entities that want to fairly redeem tether to be able to do so.
Bitfinex is elated with the court’s decision and wrote:
“We believe that the court’s decision today leaves no doubt that both Tether and Bitfinex are entitled to run their businesses in the ordinary course, even during the short period when this now narrowed preliminary injunction is in place.”
Additionally, Bitfinex continued their offensive stance against New York Attorney General’s office. They go on to maintain their position that the Attorney General acted in bad faith.
“We will vigorously defend against any action by the New York Attorney General’s office, and we remain committed, as ever, to protecting our customers, our business, and our community against their meritless claims.”